Capex down by R12bn – report

THE capital expenditure by the State has decreased – for the first time since 2009 – by R12 billion as at the end of 2017, according to Statistician-General Risenga Maluleke.

Briefing the media on the capital expenditure (Capex) 2017 report, Maluleke said expenditure by public sector institutions had exceeded R1.3 trillion in the last five years. However, the expenditure decreased from R283 billion in 2016 to R271bn in 2017 with provinces showing a 6% decline.

“This is the first year-onyear Capex decrease since 2009-2010,” Maluleke said.

New construction was the largest component of the expenditure by the public sector.

“Public corporations were the largest spenders. Significant amounts were spent on service delivery-oriented aspects,” Maluleke said.

The report showed that expenditure on plant, machinery and equipment was down by 16% – from R55bn in 2016 to R46.1bn.

Transport equipment followed the same trend from R7.8bn to R6.4bn and new construction went down from R193bn to R188bn.

The only increase was in land and existing buildings, rising from R15.8bn to R16.8bn.

“We have seen Capex of public sector rise steadily and, of course, coming to 2016 hit a climax at R283bn and going back to R271bn,” Maluleke explained.

Eskom emerged as the major contributor in capital expenditure at R75.5bn – an increase from R73bn recorded in 2016.

This was attributed to the construction at Kusile power station and the nationwide electricity distribution programme.

The power utility was followed by Transnet (R25.4bn), South African National Roads Agency Limited (R9.3bn), Telkom (R8.2bn) and the Passenger Rail Agency of South Africa (Prasa) at R5.4bn.

Both Prasa and Transnet recorded decreases in the last financial year.

Maluleke said total expenditure by municipalities was recorded at R394bn; but R63bn went towards actual capital expenditure and R331bn on operational expenditure.

eThekwini Metro spent R4.8bn (84%) of its total capital expenditure on rehabilitation of roads and construction of an integrated rapid public transport network, while Oudtshoorn Municipality spent R31m on bulk electricity supply to Rose Valley and high-mast floodlights.

The City of Cape Town spent 7% (R427m) and City of Johannesburg 2% (R173m) of their transport equipment expenditure. On plant, machinery and equipment, the City of Cape Town spent R935m (15%), City of Johannesburg R1.8bn (24%) and Greater Tzaneen R64m.

Maluleke said provincial government capital expenditure declined by 6% – down from R36.4bn recorded in 2016 to R34.2bn last year.

The Western Cape led the pack with R2.9bn expenditure by its Transport and Public Works Department on provincial roads and streets.

The Gauteng Education Department followed with capital expenditure totalling R2.5bn, then KwaZulu-Natal at R2.2bn, and the Eastern Cape spent R1.8bn on schools. Gauteng’s Health Department spent R1.6bn on construction of hospitals.

The Water and Sanitation Department led nationally with R5bn, SAPS at R2.8bn, Justice R1.4bn and Basic Education R1.1bn.

The University of Stellenbosch led higher institutions with R1.050bn followed by University of Pretoria R738m, University of Venda R615m, University of Mpumalanga R518m, Wits R487m and University of the Western Cape R479m.