The Standing Committee on Appropriations has welcomed the National Treasury’s overall expenditure, which is the lowest in years at 3.2 per cent and vast improvements in Capex expenditure from 46 per cent to 17.9 per cent in the first quarter of 2022/23. This, the committee believes, will ensure the people receive services. The committee received a briefing from the National Treasury on first-quarter spending patterns for the 2023/24 financial year focusing on government departments and state-owned companies (SOCs).
 
The committee noted good performance of some SOCs and government agencies, such as the Passenger Rail Agency of South Africa (PRASA). National Treasury said it was satisfied with the progress made by PRASA and that, for the first time, it managed to spend almost all the allocated funds and dealt with its capacity challenges. The committee heard that ESKOM’s unaudited first quarter performance for 2023/24 showed a loss before tax of R5 billion. However, its net revenue grew as a result of tariff increases of 18.65% from 1 April 2023 to Eskom direct customers. National Treasury said the debt owed by municipalities remains a major concern.

The committee said it would like further details on the unbundling process at Eskom, particularly regarding the funding of the autonomous entities resulting from the unbundling process and whether they would require funding and possible bailouts in future. National Treasury responded by saying the unbundled entities will be subsidiaries of ESKOM and will not need separate funding.
 
The Chairperson of the Standing Committee on Appropriations, Mr Sfiso Buthelezi, said: “It is important that we have this huge improvement in underspending on capital expenditure from 46% underspending to 17.9% underspending and shows the role the committee played.” However, the committee is concerned with departments that are underspending in Q1/2023. Although explanations were given, the committee would like to see that situation corrected in Q2/2023.
 
The committee remains concerned with the slow pace of spending on conditional grants such as the Comprehensive Agricultural Support Programme (CASP) in provinces due to administrative red tape in different spheres of government, which impacts on services to communities. The committee further urged National Treasury to work on finding better ways to assist provinces with compliance with conditional grants.
 
The committee expressed it satisfaction with the results of its interventions and that of Parliament as it shows oversight is working.

Issued by The Chairperson of the Standing Committee on Appropriations, Sfiso Buthelezi