KZN Treasury MEC François Rogers and Premier Thami Ntuli attended the presentation of the Provincial Unity Government's first 100 days report. (Photo: KZN Ministry of Finance/X)
The KwaZulu-Natal Unity Government (GPU) has announced a series of tough cost-cutting measures to tackle the province's growing budget deficit, which is currently projected to reach R9 billion by the end of the financial year.
The state Treasury said the cuts would lead to cost savings of an estimated R3 billion.
KZN Treasury said in a statement that the initiative was issued through a Treasury Directive from Finance MEC François Rodgers and is aimed at addressing spending pressures while prioritizing essential services.
The measures were approved at a recent state cabinet meeting and include significant cuts to living expenses, travel expenses, international travel, car rentals, events and catering.
Rogers said the cuts are aimed at offsetting the financial burden that led to the increase in receivables and the state's difficulty paying suppliers within the legally required 30 days.
“KZN faces severe financial constraints,” Mr Rogers said.
“We are committed to achieving a budget surplus by the end of our term, but this will require strict fiscal discipline and strengthening of revenue sources.”
He said essential spending would not be compromised and stressed GPU's focus on job creation, poverty reduction and frontline service delivery in areas such as education and health.
This cost containment plan is in line with National Finance Minister Enoch Godongwana's recent Medium Term Budget Policy Statement (MTBPS), which reveals that the national economy remains under pressure with the debt-to-GDP ratio under pressure. It became.
Mr Rogers said the MTBPS also confirmed that no additional medium-term funding would be allocated to states, reinforcing the urgency for state-level fiscal reform.
However, the state is hoping for a boost from new census data, which could see its fair share grant under the Medium Term Expenditure Framework increase by R4 billion.
Despite this potential remedy, Mr. Rogers said non-compliance with the new fiscal policy will not be tolerated, citing provisions in the Public Finance Management Act that force compliance.
Mr. Rogers said this decision seeks to balance fiscal responsibility and prioritizing critical service delivery during challenging economic times and supports broader efforts to build an ethical and competent state government. He said that it is part of the
