Eastern Cape allocates bulk of its budget to Health, Education

Education and health have, once again, been allocated the bulk of the Eastern Cape’s R86.2 billion budget. Finance MEC, Mlungisi Mvoko put R35.1 billion aside for Education and R26.4 billion for health.

Mvoko’s budget is centered around four pillars: investment in projects that will grow the economy, improving fiscal discipline and governance, protecting and growing critical socio-economic infrastructure, and keeping public expenditure at sustainable levels.

Mvoko kicked off his budget speech by emphasising the need to create harmony between spending and generating income. He said spending is already a notch higher than what the province generates.

As part of the province’s economic recovery plan, emphasis will be on infrastructure development, agriculture and tourism as strategic sectors.

“We have allocated R13.9 billion for this year and R40.5 billion over the MTEF to the Economic Sector, inclusive of Department of Public Works, Agriculture and Agrarian Reform, Economic Development, Environmental Affairs and Tourism, Transport and Human Settlements. This allocation will support a five-point plan for the economic recovery of the province, to improve the economic trajectory of the Eastern Cape. Our pillars of this plan include Infrastructure Development, Industrialisation and Sector Development, Equitable and Inclusive Transformation, Digital Transformation and Public Finances.”

Plans to revive the manufacturing sector at sites that stopped functioning in Dimbaza, Queenstown and Fort Jackson have been on the cards for the past six years.

Now with the intervention of the Department of Trade, Industry and Competition, new life is to be breathed into these sites.

“Working with the Department of Trade, Industry and Competition (DTIC), the provincial government will continue to invest in industrial infrastructure in the province to enhance local manufacturing capacity. In this regard, an amount of R76.8 million has been allocated for the Dimbaza Industrial park and R985 000 for electrification of Queendustria, through the Provincial Stimulus Fund.”

The two Special Economic Zones in Buffalo City and the Nelson Mandela Bay metros continue to be development focus points.

“A total of 16 investments at East London IDZ will be implemented in the 2021/22 financial year, at a rand value of R2.4 billion, with over 1 400 job opportunities expected to be created. A total of R118.7 million for 2021 and R336.3 over the MTEF has been allocated to the Zone by the provincial government to fund its operational costs, which includes among other things, investment promotion and attraction.

“Coega Development Corporation has been allocated a transfer budget of R192 million in this financial year and R193.4 million over the MTEF. These funds will be utilised for Zone development and operational expenditures which include investor attraction and retention,” Mvoko explained.

The  Eastern Cape economy is expected to grow between 2% to 3% in  202. But the province still faces an unemployment rate of nearly 48%.

More than 60% of its budget goes towards the public sector wage bill. Meanwhile, opposition parties in the provincial legislature have reacted to the budget with different views. Some say it lacks detail while others say it’s a repetition of previous promises.