South Africa
Only 9 % of national budget goes to Municipalities

The National Assembly has passed the 2017 Division of Revenue Bill with an objection from the DA.

The last public hearings were held on the bill earlier this week with Salga raising concern that only 9% of the national budget went to local government.

Earlier, Deputy Finance Minister Mcebisi Jonas said the increasing tough economic conditions increases government’s obligation to shift more resources to the poor and vulnerable.

Jonas elaborated on the various economic challenges which affect 2017’s budget.

“Lower economic growth has contributed to tax revenue that are significantly below what we have projected in last year’s budget.

At the same time, we need to ensure that the country’s borrowing path remains sustainable. Already, we spent more on interest payments each year than we transfer to local government.

All of this means that we have to reduce fiscal space in which to act.

At the same time, the tough economic climate increases the needs of the poorest and the most vulnerable in society, meaning the demand for government resources.”

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