KZN is the poorest province despite the biggest slice of the equitable share

By Francois Rodgers, MPL DA KZN Spokesperson on Finance ONE of the greatest challenges facing South Africa is the taxing economic climate but in order for us, as government, to deliver on our mandate we can no longer blame external influences or the global economic meltdown for our current situation. The recent remarks by Finance Minister Nhlanhle Nene confirm that we have also been hard hit by “supply failures in electricity, water and postal services” which have “hurt the economy and worn down public confidence”. Apart from external financial factors, one of the reasons we find ourselves in a situation where government has to lower its expenditure ceiling to reduce budget deficit and stabilise public debt, is due to the disastrous consequences of President Zuma’s poor and costly leadership and the ANC’s cataclysmic policy flops. During the past six years, growth has continued to undershoot expectations. Yet, under ANC leadership, government continues to splash out on infrastructure, social protection measures and job creation initiatives – all in an attempt to breathe life into a failing economy at the expense of increasing debt levels. This is clearly borne out by the fact that, for the first time since the dawn of our democracy, South Africa’s spending exceeded its revenue in 2008 and has yet to recover. We now find ourselves in the precarious position of having to raise debt to balance the books and currently owe R1.6 trillion which is expected to grow to R2.2 trillion in 2017. * The net result is that 12% of national revenue is used to service interest on these loans * The net result of this is that the provinces suffer a cut in revenue to cover loans of failed policy All of this is a direct result of trying to shut the stable long after the horse bolted. Bad leadership and poor policies have resulted in a reduction of the division of revenue under the ANC National Government and created a “Stockholm Syndrome” for the ANC in KZN. KZN currently receives the largest share of transfers to provinces at just over R99 billion. Ironically, getting the biggest slice of the equitable share and infrastructure grant in terms of the principles of DoRA, actually means that KZN is actually the poorest province when the equitable share formula is applied. In other words being at the bottom of the provincial pile guarantees us the biggest piece of cake. Is this really where we want to be? Surely we should be striving to address; * the economic output component, * the poverty component and * the health component? As the province of KZN our ultimate aim should be to improve the lives of all citizens. The fact that we receive the largest financial support in the division of revenue does not necessarily mean that we are achieving this objective. Nor does it mean that KZN is making any progress in spending its financial allocation to improve infrastructure, development, service delivery and ultimately the lives of our people. [END] ##################################################################################### Scanned by MailMarshal – M86 Security’s comprehensive email content security solution. Download a free evaluation of MailMarshal at www.m86security.com #####################################################################################