President Ramaphosa Encouraged to Address Looming Budget Cuts at the President’s Coordinating Council
The Western Cape’s Premier, Alan Winde, has recently reached out to President Cyril Ramaphosa to discuss the imminent reductions in the 2023 medium-term expenditure framework (MTEF). The issue requires urgent attention at the upcoming President’s Coordinating Council (PCC) meeting on September 1, 2023.
The Fiscal Emergency
The 2023/24 and 2024/25 public service wage settlements are the root cause of the fiscal emergency, which lacks adequate funding for sustenance. Premier Winde expresses his concern over South Africa’s deteriorating financial situation, which poses a significant threat to essential services such as healthcare, education, and social development.
Protecting Essential Services
In previous correspondence with President Ramaphosa, the provincial government emphasized the severity of the fiscal challenges arising from budget reductions that the Western Cape Government (WCG) would face. Protecting frontline services from these cuts is an impossible feat, and communities across the nation are likely to experience heightened frustrations and grievances.
Negative Impact on Service Delivery
Premier Winde cites the adverse effects of severe expenditure reductions on basic, constitutionally mandated services as neither credible nor rational. He highlights the fact that residents, especially the most vulnerable, will suffer due to the significant negative impact on service delivery.
National Government’s Responsibility
Premier Winde argues that provinces should not carry the burden of the budget shortfall resulting from the 2023 public sector wage agreement. The national government should not commit provinces to expenditure by concluding wage agreements on their behalf without providing the necessary funding.
According to section 214(2) of the Constitution, the national government must ensure that provinces receive a sufficient revenue allocation to provide basic services and perform their allocated functions when distributing revenue. Premier Winde emphasizes the gravity of this situation, urging the President to include this issue on the PCC’s agenda for urgent discussion.
A Collaborative Effort
While representing the Western Cape, Premier Winde acknowledges that this matter concerns all provincial governments. He reiterates the WCG’s commitment to addressing these concerns in the best interest of their citizens, especially the most vulnerable.
In addition to discussing the matter with President Ramaphosa, Premier Winde plans to address the constrained fiscal environment with Western Cape mayors and municipal managers at the Premier’s Coordinating Forum on August 29, 2023, in Plettenberg Bay. This collaborative effort aims to mitigate the adverse effects of the looming budget cuts on the nation’s essential services and ultimately serve the best interests of the people of South Africa.
