provincial budget: 2017 mtef - sbs documentsdocs.sbs.co.za/13 - ivanmeyer.pdf · address to the...

Address to the Western Cape Property Development Forum

5 May 2017

PROVINCIAL BUDGET: 2017 MTEF

Dr. IH Meyer

Provincial Minister of Finance

Macroeconomic context

© Western Cape Government 2012 |

Western Cape economic performance


-2

-1

0

1

2

3

4

5

6

7

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

% g

row

th r

ate

SA (ex-WC) Western Cape SA (ex-WC) average Western Cape average

0.3

0.9

2.4

2.5

3.3

3.7

3.8

3.8

3.9

4.5

6.7

0.0 2.0 4.0 6.0 8.0

Mining & quarrying

Electricity, gas & water

Manufacturing

Community, social & personal services

Agriculture, forestry & fishing

Total

Wholesale & retail trade, catering & accommodation

Transport, storage & communication

General government

Finance, insurance, real estate & business services

Construction

Average growth rate (%)

Slowing economic performance

Finance, insurance, real estate and

business services sector was biggest

contributor to growth in 2014

Construction sector was fastest

growing sector over 10 years with

average growth of 6.7%

Key sectors: Agri processing, tourism

and oil & gas

Building plans can be used as a

leading indicator of future building

and construction activity

Western Cape growth compared to the rest of South Africa (2004 - 2014)

Fastest growing sectors in the Western Cape (2004 - 2014)

Approach to 2017 MTEF Budget


Policy principles underpinning the WC budget process


• Constitutionalism • Partnerships

• Evidence Base • Whole-of-society approach

• Public Value • Citizen Centric

• Rule of Law


Fiscal and Budget Policy Approach


Fiscal and Budget Policy Principles:

• Allocative efficiency: allocation of resources towards

priorities of government to programmes that are effective

• Fiscal consolidation: which generally entails reducing

government expenditure and/or increasing revenues

• Fiscal sustainability: maintaining stability in key government

programmes and managing risks

• Fiscal discipline: being financially accountable by ensuring

that there is no irregular or wasteful spending by any

department or entity


The 2017 Provincial Budget

Theme: Budget for Growth

1.Inclusive

2.Sustainable Government

3.Smart Growth




1.Infrastructure – led growth

2.Growth potential: Towns Regions

3.Asymmetrical


Budget Policy Priorities


Provincial Strategic Plan 2014 - 2019



Budget Policy Priorities [1]


Project Khulisa

Saldanha Bay IDZ

Atlantis SEZ

Catalytic Infrastructure

PSG 2: Improving Language and Mathematics, Matric pass rate, Quality education

in poorer communities, e-Learning, Early Childhood Development, Grade R,

Youth Development and After School Programme

Ease of doing business programme

Agriculture

Energy Security Game Changer

Apprenticeship Game Changer

PSG 1: Promoting investment and providing support to key economic sectors, artisan

and technical skills, ease of doing business, green economy and toward

infrastructure – led growth

No-fee schools and learner transport

scheme

Collaboration Schools

MOD programme

Year Beyond

Youth Cafés

Chrysalis Academy

eLearning Game Changer

After Schools Programme


Budget Policy Priorities [2]


PSG 3: Inclusive, healthy and safe communities and families and children, social

development services for the poor and most vulnerable and alcohol harms reduction

WoW

1st 1000 days

90-90-90 campaign

Integrated Service Delivery Model

Services to persons with disabilities,

children and older persons

Supporting arts and culture

Community Safety Improvement

Western Cape Police Ombudsman

Road safety

PSG 4: Integrated Human Settlements, Spatial and development planning, sustainable

ecological (water and climate change) and agricultural resource-base and Better

Living Model

Catalytic housing projects

RSEP/VPUU

Provincial Spatial Development Plan

Water security/drought/climate change

Fire and disaster management

Better Living Model Game Changer

PSG 5: Enhanced Governance, Integrated Management, Inclusive Society and Broadband

Good financial Management

Supporting Municipalities

Data Governance

Broadband Game Changer

Infrastructure: A lever for economic

growth


Infrastructure


Infrastructure investment is a key priority to support growth and socio-economic

transformation

Integrated Management Approach for infrastructure delivery

• Partnerships and governance

Emphasis on maintenance - Minimal sustainability

Optimising human resource capacity

Majority of infrastructure investment in Roads, Education, Health and Human

Settlements



• The 2017 Provincial Budget provides for total expenditure amounting to R59.3 billion in 2017/18; R62.1 billion in 2018/19 and R65.3 billion in 2019/20.

• Over the 2017 MTEF, approximately R28 billion

will be invested in infrastructure within key sectors such as education, health, social development, human settlements and public works.


2017 MTEF: Infrastructure Budgets


Infrastructure investment of R28 billion over the 2017 MTEF

Majority of infrastructure investment in Roads, Education, Health and Human Settlements

Education R4.8 bn

17%

Health R2.5 bn

9%

Transport and Public Works

R11.6 bn 41%

Public Private Partnerships

R230.8 m 0.1%

Human Settlements R7.2 bn

26%

Environmental Affairs and

Development Planning R113.1 m

0.4%

Social Development

R1.9 m 0.1%

Broadband 1.7 bn

6%


Maintenance and repairs over the MTEF


-

500

1,000

1,500

2,000

2,500

2013/14Audited

2014/15Audited

2015/16Audited

2016/17Rev Est

2017/18 2018/19 2019/20

R'0

00

00

0

Financial period


The 2017 Provincial Budget…

Education: R4.8 billion over the 2017 MTEF.

• 16 New schools (637 classrooms);

• 220 classrooms to be added to existing

schools;

• 15 Replacement schools will be

completed beyond the current MTEF.




Health: R2.5 billion over the 2017 MTEF.

• Upgrades and additions to Emergency Centres;

• Prioritised maintenance and upgrades at Groote Schuur and Tygerberg

Hospitals;

• New acute psychiatric unit at Khayelitsha;

• The Eerste River and new Somerset Hospitals;

• Observatory Forensic Pathology Laboratory (replacement of the salt river

Mortuary);

• Avian Park, Napier, Prince Alfred Hamlet and Wolseley clinics;

• Hanover Park and Ravensmead Day centres.




Roads: R9.8 billion over the 2017 MTEF. • Reseal Melkbos Road; • implementation of 36 large projects including

Simonsvlei, Paarl-Franschhoek, Oudtshoorn-De-Rust and Kalbaskraal Road rehabilitation;

• Sixteen Mega projects currently under construction, including the Worcester (Nekkies) road; the Piketberg - Velddrif and Roberson – Bonnievale projects, and

Public Works: R1.8 billion Over the 2017 MTEF. • Optimising provincially owned office space across

the province through an Office Accommodation Modernisation programme.




Human Settlements: R 7.2 billion over the 2017 MTEF.

• Three priority areas will be focused on:

1.Directing more resources towards the upgrading

of informal settlements;

2.Accelerating affordable housing; and

3.Prioritising the most deserving people in

allocating free Breaking New Ground Houses.




Human Settlements: R 7.2 billion over the 2017 MTEF.

• The Department’s Catalytic Priority Projects over the 2017 MTEF includes:

1.The City’s Southern Corridor (51000 opportunities);

2.Transhex (8000 opportunities)- Worcester

3.Vlakkeland (2556 Opportunities) - Drakenstein

4.Belhar (3000 opportunities); George (15000

opportunities), and

5.Investment in bulk infrastructure in non-metro

municipalities to the value of R64 million, to speed-up

housing delivery.




CapeNature: R113 million over the 2017 MTEF.

• Improvements at Kogelberg Nature Reserve: Phase 2

– the development of new chalets, a conference

centre and an eco-pool.

• Focus on implementing a more rigorous maintenance

programme and upgrading of existing assets across a

number of provincial Nature Reserves.

Broadband: R1.7 billion over the 2017 MTEF.

• The roll-out of Broadband Infrastructure across

the province.



Nature of investment

• R5.6 billion will be spent on infrastructure maintenance and repairs;

• R3.0 billion on upgrades and additions;

• R6.0 billion on refurbishments and rehabilitation of existing infrastructure assets;

• R3.4 billion will be invested in new infrastructure assets, and

• R7.3 billion spend on infrastructure transfers.

15%

29%

17%

36%

3%

Infrastructure spend per category: 2017 MTEF

Upgrades and Additions Refurbishments and Rehabilitation

New Infrastructure Assets Infrastructure Transfers

Non-infrastructure Expenditure



Spatial distribution of infrastructure spend

Infrastructure expenditure, in particular new infrastructure needs to be informed by sustained population growth and regional economic growth.

The proportional allocation towards districts are depicted below.

Across Districts 30%

Cape Winelands 15%

Central Karoo 1%

City of Cape Town 31%

Eden 10%

Overberg 6%

West Coast 7%

Spatial Distribution of Infrastructure Spend

Across Districts Cape Winelands Central Karoo City of Cape Town Eden Overberg West Coast



Western Cape - Top 20 infrastructure projects



Cape Winelands – Top 10 projects



Overberg – Top 10 projects



Central Karoo – Top 10 projects



Eden – Top 10 projects



City of Cape Town - Top 10 projects



West Coast - Top 10 projects



Health and Education Infrastructure Delivery focus areas

As noted by both WCED and WCGH, significant progress has been made to establish joined up government in

infrastructure delivery and efforts will continue to entrench the IDMS in these relationships

Strategy to be revised to make portfolio sustainable – innovative delivery through repeat designs and

standardisation, comprehensive facility management

Unlock potential of portfolio itself to move to sustainability – consolidation, release and partnerships for

development

Fiscal constraints require a shift from new capital projects to maintenance of the existing portfolio


© Western Cape Government 2012 | Address to the Western Cape Property Development Forum

Kasselsvlei Primary School 2014 Concordia High School 2016

Brackenfell Secondary School 2014

© Western Cape Government 2012 | Address to the Western Cape Property Development Forum

Khayelitsha Hospital Khayelitsha Shared Services

Mitchell’s Plain Hospital


Human Settlements


The Department of Human Settlements’ investment pursuant to a vision of enabling a

resilient, sustainable, quality, inclusive and transport orientated human settlement

development.

http://www.dhs.gov.za/sites/default/files/galleryfile/ajax/field_gallery_image/und/form-nhM9cMxXlUgD4nuyhLeRO78c5ijVBUQN5U77H_omcdw/IMG_7491 (3).jpg



Zwelihle Housing Project, Hermanus 2016 Pelican Park Housing Project, 2014


Transport and Public Works: Branch Roads


The Western Cape’s roads are used by millions of

commuters every day. Commuters value the

importance of high-quality road infrastructure as a

critical component of an effective transport system

that also makes a substantial contribution to

productivity, safety and economic development in

the Province.

Spier Rd

Upgrading

2014

Construction at Annandale Road 2014



Transport and Public Works: Branch Public Works


The Departments of Transport and Public Works: Branch Public Works infrastructure

budget has increased over the period 2009 to 2014, from R159.7 million to R605.8 million.

During this period, Cabinet also approved a Modernisation and Regeneration

programme



In summary

The focus for the 2017 Budget includes balancing public finances and managing

fiscal risks while giving effect to National and Provincial policy imperatives

The 2017 Budget maintains its commitment toward service delivery impact and

delivering a budget for growth

Effective delivery of government programmes is supported by Integrated

Management and Partnering to deliver a budget for growth

Infrastructure-led growth and the spatial distribution of provincial expenditure

remain critical focus areas

Investment in growth and people is critical (Education, Health, economic

infrastructure)

Budget for prosperity, people and growth


Thank you

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