Cost-cutting measures for KZN
THE KZN government is tightening its purse strings, with budget cuts and various cost-cutting measures amid tough economic times.
Delivering the 2024 Provincial Budget last week, Finance MEC Peggy Nkonyeni said the reduction in spending is necessitated by a weak economic performance and several challenges within the province.
"The economic challenges in
KZN are further exacerbated by climate change, which has caused frequent disastrous floods that continue to cause damage to economic and social infrastructure as well as leading to loss of lives," she said.
"The province has decided to effect reductions across the board to increase our contingency reserve from around the R225-million to R236-million per annum mark over the Medium Term Expenditure Framework (MTEF)."
Nkonyeni said this will allow the government to respond to unforeseen circumstances that may arise.
"In this regard, we have cut back spending by R132.5-million, R103.5-million and
R105.4-million over the MTEF to fund this increase in reserves," said the MEC.
"This means the provincial budget reduces by between R4.4-billion and R4.7-billion in aggregate over the 2024/25 MTEF."
The MEC said, despite an expected moderate expansion of 1.1% in economic growth this year and 2.3% in 2025, they remain optimistic about job creation efforts, infrastructure investment, exports, port expansion projects, and the functioning of the Dube Trade Port and Richards Bay Special Economic Zones.
The bulk of the provincial budget is allocated to the departments of education, health and social development, which receive 80% of the budget.
The total infrastructure budget has been set at R17.1-billion, R17.3-billion and R17.4-billion over the MTEF.
"The budget cuts are significant, and departments were required to review the targets they have set for themselves in the 2024/25 annual performance plans to fall in line with their amended budget.
"For some, it has meant that various posts will not be filled, and additional cost-cutting measures must be implemented, while others have noted that some projects will have to be rolled out over a longer period.
"Departments will place more emphasis on implementing efficient business processes to ensure quality services continue to be rendered to our communities," said Nkonyeni.