Budget 2023
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Cost-cutting beginning to pay off

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Cape Town – Government will continue with its strict cost containment measures in the 2017/18 financial year, Finance Minister Pravin Gordhan said in his 2017 Budget Overview. 

The belt-tightening exercise includes the freezing of non-essential civil servant positions and further curbing of spend on non-essential items such as entertainment, advertising, newspapers and publications, as well as the attendance and hosting of conferences. 

National Treasury has frozen all unfunded vacant positions as part of its cost-containment measures. To ensure that service delivery is not negatively affected by this decision, a recruitment committee chaired by the director general was established. This committee meets regularly to assess all current vacancies and approve critical posts that need to be filled urgently. 

A travel policy framework was also created with measures to contain travel and accommodation costs.

In addition to cost savings at national departments, municipalities also need to comply with strict spending containments. 

Gordhan said in the context of the constrained fiscal environment, provinces have already made progress in reducing spending on non-core goods and services and in controlling personnel costs.

“Spending on non-essential goods and services fell in real terms by 7.1% in 2014/15, by 6.1% in 2015/16 and is anticipated to decline by 4.5% annually over the medium term,” Gordhan said. 

The proportion of provincial spending on personnel has declined to just under 60% in 2016/17, freeing up more resources to invest in services.

Provinces have also put their public entities under review, to eliminate duplication of activities and ensure effective governance and clear development mandates.

* Visit our Budget Special for all the budget news and in-depth analysis.

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