Source: South Africa News Agency
The National Treasury has revised the 2020 Budget national share from R758 billion to R790 billion, Finance Minister Tito Mboweni has revealed while delivering his Supplementary Budget on Wednesday.
The revision of the budget will also see the provincial share decrease from R649 billion to R645 billion.
“[The] local government share increases from R133 billion to R140 billion,” he said.
Local government, he said, is at the heart of South Africa’s response to the COVID-19 pandemic.
“Accordingly, an additional R11 billion is allocated to local government through the equitable share. A further R9 billion will be reprioritised within allocated conditional grants to fund additional water and sanitation provision and the sanitisation of public transport,” he said.
Municipalities are expected to adjust their budgets to take into account the sharp decline in revenue as a result of the pandemic.
“We urge communities to hold councils accountable for the spending of COVID‐19 funds. National Treasury will also monitor the spending through monthly and quarterly reports,” he said.
Additionally, the government in March unveiled a R500 billion COVID-19 fiscal package for economic relief.
Elaborating on this, the Minister said, of this, R190 billion in main budget spending – of which R145 billion is allocated immediately – was to protect lives and support livelihoods. Of this R70 billion, was for tax policy measures while a R200 billion loan guarantee scheme was availed to support short-term economic activity.
“In addition, the Reserve Bank has reduced interest rates and provided additional support to the bond market, financial-sector regulations have been eased to support the flow of credit to households and businesses, and commercial banks have introduced temporary payment holidays,” said the Minister.
While government moved quickly to redirect funding to support COVID-19 interventions, the trajectory and effects of the virus remain highly uncertain, said Treasury in its Supplementary Budget review report.
In this context, reads the report, government is adjusting the allocation of funding to respond to new data and accompanying adjustments to policy.
“The allocation of funding in this special adjustments budget reflects the reorganisation of the initial package proposed in April based on subsequent shifts in spending needs related to COVID-19.
“Funding has been secured by shifting resources from existing programmes and drawing down surplus funds from institutions such as the Unemployment Insurance Fund (UIF). Budget allocations across national, provincial and local government fund R145 billion of government’s response,” the report states. – SAnews.gov.za