The United Nations Children’s Fund (UNICEF) is encouraged that the Medium-Term Budget Policy Statement (MTBPS) represents the first major government policy statement since 2012 which does not further decrease the spending ceiling available to national, provincial and local governments.
This critical policy statement recognises that constant expenditure cuts might be counterproductive and commits the country to better utilise existing resources by reprioritising spending to where it is needed most.
More than R32 billion of government spending will be reprioritised over the next three years, and there are important gains for children. These gains include:
- A further R800 million is set aside to finance the school infrastructure programmes, especially the eradication of pit latrines and improved sanitation in South Africa’s most disadvantaged schools;
- More than R500 million is added to finance critical posts in health to maintain and expand service delivery in that sector and to pay for the financing of a minimum wage for community health workers;
- More than R160 million is added to support the acquisition of medical equipment and the building of a new academic hospital in Limpopo;
- Zero-rated VAT on sanitary pads as well as free sanitary towels for learners in low and middle-income households;
- A commitment to grow social sector spending by 2 per cent above inflation on average over the next two years.
- Sustaining the moderation of the rate of growth in PSET to create much-needed fiscal space for basic education, primary health care and social welfare at the provincial level;
- The incorporation of conditional grant funding for social workers’ employment and substance abuse treatment into provinces’ own funding.
Challenges facing children’s budget programmes:
- The requirement that provincial governments absorb the costs of wage increases is concerning, especially in view of large unpaid invoices in some provinces. This may negatively affect direct service delivery to children;
- Debt servicing costs are the fastest rising expenditure item in the country’s budget, and consumes between R11 and R12 of every available R100 for service delivery.
UNICEF recommendations for the 2019 Medium-Term Expenditure Framework:
- Government should urgently introduce plans at the provincial level to address spending arrears and its impact on planning and execution in basic education, health and social welfare;
- Finalise the review and reform to the policy framework for the financing of Non-Profit Organisations (NPOs) to bolster frontline service delivery to marginalised children and adults;
- Continue to link the social grants to inflation, while ensuring that all eligible children receive the Child Support Grant, i.e. reduce the exclusion error of the grant especially for children between 0-1 years of age;
- The government should urgently consider introducing the “Cash Plus” agenda to support the poorest and most marginalised children and their caregivers who receive child grants. This will include complimentary social welfare services such as early identification and referral as well as early childhood development, positive parenting, child and youth care, protection and empowerment programmes.
- Since population growth consistently exceeds real economic growth, there is need for continued commitment to use government spending to fight rising poverty and inequality.
Recognising that investment in children’s services takes time to produce tangible results, UNICEF calls on the government to continue its long-standing commitment to children’s services and programmes and where possible, expand service provisioning, especially for the poorest and most marginalised children.