Cape Town – Finance Minister Pravin Gordhan has announced that from 1 April, government will freeze appointments to non-critical vacant posts, as part of measures to contain costs.
The Minister announced this when he tabled the 2016 Budget in the National Assembly, on Wednesday.
With the South African Revenue Service (SARS) projected to collect lower than anticipated revenue, the Minister said government needed to tighten its belt in order to stabilise debt as a percentage to Growth Domestic Product (GDP).
“This year’s budget…is focused on fiscal consolidation. We cannot spend money we do not have. We cannot borrow beyond our ability to repay. Until we can ignite growth and generate more revenue, we have to be tough on ourselves,” he said.
According to the National Treasury’s Budget Review, teachers, nurses, doctors, police officers and other critical posts will be excluded from the lock and appointments will be sanctioned only after departments have submitted revised human resource plans aligned with compensation budget limits. Adherence to these limits will be strictly monitored.
The review further said that in many cases, departmental plans will reduce personnel headcounts in administrative and managerial posts, eliminate unnecessary positions, and establish a sustainable level of authorised, funded posts.
It also said the 2016 Appropriation Bill proposes to strictly earmark compensation budgets. Any additions or changes to how the funds are to be spent will require legislative approval.
National Treasury said administrative and regulatory changes will limit the appointment of contract staff, reduce posts not on the approved establishment and align organisational structures with approved budgets.
Decisions to award performance bonuses and promote staff will need to be balanced against the need to maintain employment of critical staff, the National Treasury said.
With compensation budgets expected to grow at a rate of 7.4% due to the public sector wage agreement that was concluded in May 2015, the National Treasury, the Department of Public Service and Administration and the Department of Planning, Monitoring and Evaluation are assessing the 2015 public sector wage negotiation process.
The results of the assessment will be used to develop and propose reforms to collective bargaining and remuneration that could further enhance fiscal stability, the National Treasury said.
His announcement comes after President Jacob Zuma said during the State of the Nation Address (SONA) on 11 February that government would reign in wasteful spending through several measures.
Minister Gordhan said to further curtail spending, government would reduce transfers for operating budgets of public entities.
He said capital budgeting reforms will also be implemented to align plans with budget allocations while strengthening maintenance procedures.
While government would strengthen its grip on its national travel and accommodation policy and instructions on conference costs, Minister Gordhan said new guidelines to limit the value of vehicle purchases for political office bearers would soon be implemented.
He said government would also renegotiate government leasing contracts and also ensure that there is a mandatory use of the new e-tender portal to enforce procurement transparency and accessible reference prices for a wide range of goods and services.
The Minister also said that initiatives of the Chief Procurement Officer will be extended to include monitoring of state-owned companies’ procurement plans and supply chain processes, and reviews of contracts above R10 million to ensure value for money.
Centrally negotiated contracts will be mandatory with effect from April 2016, the Minister said. – SAnews.gov.za
