Life ...un-limited

What is the National Budget?

The world economy is in a worse position than it has been in several decades.

According to a report by the International Labour Organisation, more than

18 million people could lose their jobs this year and this figure could be even

higher if the situation gets worse. All countries are affected by this slowdown.

Economic information from many countries, including developed countries

such as the United States, Britain and France, is concerning. South Africa is

not as badly affected, and we want to keep it that way. In fact, we want to do

better so that we can continue to provide for the needs of our people. We must

also use the period ahead to try and deal with the many challenges facing us.

Like the rest of the world, our economy is going to grow more slowly. We

too are experiencing job losses and many people will struggle to cover their

monthly household expenses. When the economy grows at a slower rate,

governments collect less taxes. This means that government will have to

borrow to meet some of its spending commitments.

Government spending will continue to grow on services that help poor

communities, and public works programmes which will create more new

jobs. Over R780 billion will be spent on large infrastructure projects over the

next three years, including building more power stations, roads and railways,

upgrading water and sanitation networks and providing more houses. We will

also work with business and trade unions to ensure that job losses are kept to

a minimum.

Many countries are not able to respond to this situation as we can. South

Africa can take these measures to protect our economy and the poor because

in previous years we handled our finances with discipline. We saved money

when our economy was doing well. As a result, we can increase spending on

public services without hurting our economy.

• R12 billion more for social grants

• R45 billion more for provinces to improve education, health and roads

and to spend more on rural development

• R10.9 billion more for housing, water, sanitation and municipal services

• R5.4 billion more for improving the criminal justice sector

• R6.4 billion more for public transport, national roads and rail

infrastructure

Despite government’s best efforts, meeting the needs of all South Africans will

be tougher over the period ahead. Government officials must remain mindful

of the fact that our resources belong to all South Africans. We all have a role to

play in making sure money is not wasted by any of our civil servants. We must

combine our efforts in working together toward our economic recovery.

Government provides social

grants to more than

13 million South Africans.

The state also provides benefits

such as free schooling to the

poor, free primary health

care, and free water and

electricity to poor households.

All children up to the age of

15 whose parents earn less that

R2 300 a month are eligible for

the child support grant. Men

above the age of 63 and women

older than 60 can access the old

age pension if they earn less than

a certain amount. The age limit

for men to receive the old age

grant will be reduced to 61 in

April 2009 and 60 in April 2010.

Social grants increase from

1 April 2009 as follows:

• The old age pension,

disability and care

dependency grants increase

by R50 to R1 010 a month

• The child support grant

increases by R10 to

R240 a month

• The foster care grant

increases by R30 to

R680 a month

In 2009/10, spending on

grants will increase to R80

billion, which is 12% of total

government spending. This

makes South Africa one of the

world’s biggest spenders on

social grants.

One of the legacies of

apartheid is the poor design

of our cities, forcing workers

to live far from their places of

work. To fix this, government

is investing billions of rands

in public transport.

These investments are going

to build new railway lines, buy

new trains, put more buses on

the road, subsidise bus and

rail transport, and get unsafe

taxis off the road. Over the

next three years, government

will provide R25 billion to the

Rail Commuter Corporation

to invest in new trains

and introduce new routes.

Government is also increasing

the budget for rail safety

inspectors to reduce accidents

and delays. The R25 billion

Gautrain project is nearing

completion, and the line from

OR Tambo International

Airport to Sandton should be

in operation by early 2010.

Government is providing

large cities with R12 billion

over the next three years

for the construction of

rapid bus transit systems.

Progress is most advanced

in Johannesburg, which is

planning to spend R1.2 billion

on its bus rapid

transit system by June 2009.

Cape Town has recently issued

a tender for R600 million for

infrastructure related to its

planned system.

Existing subsidised bus

services also receive more

money to provide for increases

in costs and higher passenger

numbers. To make public

transport safer, an extra R350

million is provided to pay

taxi owners to scrap unsafe

vehicles. Over the next three

years, it is expected that about

17 000 taxis will be removed

from the roads.

Funding for a rural transport

strategy is also provided for

in the Budget.

Government is working to create

more jobs for unemployed

South Africans. The expanded

public works programme began

in 2004/05. In its first five years,

the programme created over

70 000 full time equivalent

jobs a year for unskilled and

unemployed people. These

jobs were created by increasing

the number of workers used

in government’s infrastructure

projects and in the delivery of

public services. Many of these

jobs have been short-term or

part-time positions and provided

some gainful employment and

skills transfer. From 2009,

government kicks off a new

phase of the expanded public

works programme. More than

R4.1 billion will be invested

in this programme to create

even more jobs over the next

five years. These jobs will be

created in:

• Home-based care and

community health services

• Construction, maintenance

and environmental

protection projects

• New programmes run by

non-profit, religious and

community-based

organisations

Government aims to increase the

number of full time equivalent

jobs to 400 000 a year by 2014,

helping to bring down poverty

and unemployment.