Gauteng Finance MEC Nkululeko Dunga has confirmed that the provincial government is locked in urgent talks with Finance Minister Enoch Godongwana.
The negotiations follow a directive from the National Treasury threatening to withhold R1.9 billion of the province’s equitable share due to unresolved intergovernmental debt.
Dunga warned that freezing these funds would have a devastating impact on the province’s already severely strained finances.
The R1.9 billion at risk of being withheld stems from the provincial government’s failure to settle outstanding debts owed to municipalities.
More than R808 million of this debt has been outstanding for over a year.
However, Dunga noted that the financial strain cuts both ways, revealing that municipalities, conversely, owe the provincial government approximately R2.5 billion.
“My department has already prepared a comprehensive response to find ways to resolve this intergovernmental debt,” Dunga said.
Compounding the province’s financial woes is a massive R1.4 billion underspend on conditional grants across several departments. Instead of utilising the allocations, multiple departments have applied for the funds to be rolled over to the next financial year to avoid returning them to the National Treasury.
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Dunga emphasised the contradiction of leaving funds unspent while the province’s R179 billion total budget remains insufficient to address the myriad of demands placed on it.
The underspending has sparked intense criticism in light of recent service delivery failures. The Department of Education, which failed to spend R75 million, was embroiled in a bitter dispute with scholar transport drivers earlier this year over non-payment, claiming at the time that it lacked funds.
Meanwhile, the Department of Agriculture, which left R86.5 million unspent, has faced fierce public backlash for its slow response to a devastating foot-and-mouth disease outbreak. Other major departments failing to exhaust their budgets include Health at R245 million and Sports and Recreation at R25 million.
In total, ten provincial entities contributed to the R1.4 billion underspend. The full breakdown of unspent funds includes:
Human Settlements underspent by approximately R180 million, the Gauteng Provincial Legislature by R179 million, Community Safety by R81 million, the Gauteng Department of Agriculture and Rural Development by R79 million, Sport, Arts, Culture and Recreation by R46 million, and e-Government by approximately R58 million.
Dimakatso Leshoro
www.ewn.co.za
