Going by the measures taken by governments to reduce expenditures in an attempt to shrink the growing budget deficits, Finance Minister Pravin Gordhan’s austerity measures will extend to Gauteng budget.
Gauteng Finance MEC Barbara Creecy said on Tuesday, that the city’s equitable share from the national treasury will be cut by R2.9 billion over the medium term.
“Expenditure is dependent on the availability of revenue and the level of borrowings government can afford. We understand slower economic growth means less revenue for collection, and by implication, a decrease in what the national fiscus has available to transfer to the provinces,” Creecy said as she presented Gauteng’s R103 billion for the 2016/2017 financial year on Tuesday.
“We are one with honourable Finance Minister’s aspirations to accelerate fiscal consolidation. Over the medium term, our equitable share will be cut by R2.9 billion, our contribution to Minister Gordhan’s R25 billion budget cut.”
Barbara Creecy said that Gauteng had set a target of R5 billion for its revenue for the present financial year. The revenue collected by the province totaled five percent of the budget.
Gauteng revenue is mostly collected from vehicle licensing, gambling taxes, hospital patient fees and interest earned on treasury investments.
“During the tabling of the adjustment budget, I announced that our own revenue base for 2015/16 would be R4,89 billion which is a significant increase from R4,2 billion revenue target for 2014/2015.”
“We continue to be aggressive in our revenue collection, by January this year, actual collection was at 91 percent and we remain confident that we will be collecting R5 billion on own revenue in 2016/2017.”
Gauteng budget for the last financial year totaled R97 billion, while the present financial year totaled R103,36 billion. This indicates a six percent increase in the budget.