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The Free State government has slashed its budget for the 2021/22 financial year by R400 million, as the province grapples to recover from an economic recession worsened by the coronavirus pandemic.

Unveiling the province’s spending plans on Tuesday, Finance MEC Gadija Brown said the reduction had been necessitated by fiscal reforms that South Africa was implementing to address huge budget deficits and spiralling government debt.

“As I have indicated . . . the fiscal reforms brought by the drive to stabilise budget deficit and government debt have affected our fiscal framework significantly,” she said in her budget speech.

“The better days are gone and we, therefore, cannot afford to do things the same way as we did in the past.”

As a result of the reduction, education will in 2021/22 get an allocation of R15.475 billion, which is R144 million or less than what the sector received in the previous financial year.

Health has also not been spared and will receive R12.135 billion compared to R12.477 billion in 2020/21.

However, amid the budgetary constraints, some departments – including human settlements; public works; agriculture; and police, roads and transport – will have slightly more than they were allocated last time.

The MEC emphasised the need for transparency and accountability in utilizing the limited resources which she said should be channeled towards addressing the challenges of poverty, inequality and unemployment.

“The challenges of budget constraints we face today provide an opportune time for us to keep on strengthening and institutionalising the principles of transparency, accountability, responsibility, efficiency and effectiveness in the utilisation of limited public resources,” she said.

Brown bemoaned the effects of the COVID-19 pandemic on the Free State economy, which was already in decline since 2018.

“The Free State economy has been forbidding, recording three consecutive declines in 2018, 2019 and 2020,” she said.

“The total value of the Free State’s economy was estimated at R160.8 billion in 2019 . . . due to the devastating impact of COVID-19, the Free State economy is projected to have contracted by a momentous 6.8 percent in 2020 – decreasing the value of the economy to approximately R149.8 billion.

“All sectors of the provincial economy contracted during the hard lockdown, except for agriculture, which benefitted from favourable weather conditions and large sections of the industry remaining open during the national lockdown.

“The provincial economy is, however, projected to recover and grow by 2.8 percent in 2021.”

Free State 2021/22 provincial budget allocations at a glance:

  • Education – R15.475 billion
  • Health – R12.135 billion
  • Social Development – R1.442 billion
  • Sports, Arts, Culture and Recreation – R638.523 million
  • Human Settlements – R1.256 billion
  • Public Works – R1.739 billion
  • Police, Roads and Transport – R2.882 billion
  • Agriculture and Rural Development – R783.067 million
  • Economic, Small Business Development, Tourism and Environmental Affairs – R604.792 million
  • Legislature – R258.823 million
  • Office of the Premier – R662.675 million
  • Cooperative Governance and Traditional Affairs – R416.598 million
  • Provincial Treasury – R331.491 million

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