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EC Adjustment budget cuts R402 million from economic development

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Dear Editor

The adjustment budget presented by Finance MEC Mlungisi Mvoko yesterday, underscores that the Eastern Cape government is doing little more than paying lip service to addressing unemployment and crime – two of the biggest crises facing this province.

After touting that government intends to grow the economy by 2%, the MEC slashed the budget of the Department of Economic Development, Environmental Affairs and Tourism (DEDEAT), the very department tasked with growing the economy, by R402 million.

This is a disastrous course of action for the economy of the Eastern Cape – a province with the highest unemployment rate in the country. In the Eastern Cape one out of every two employable people of do not have a job, yet government shows very little insight into growing the economy and creating employment.

DEDEAT has opportunities to partner with the private sector for infrastructure upgrades, but there appears to be little appetite for meaningful partnerships. This is an area that requires urgent focus if we are to address the province’s infrastructure challenges in a cost-effective manner.

While we welcome the R173 million allocated for broadband and ICT rollout – an essential enabler of economic growth and job creation – this is far from sufficient to address the deep-seated challenges the Eastern Cape faces. Connectivity is vital, but it cannot be a silver bullet in isolation.

The province has the highest murder rate in the country at 19.8% per 100,000 people, but the government incomprehensibly cut the budget of the Department of Community Safety by almost R3.5 million. With only 0.15% of the provincial budget allocated to community safety, the government’s commitment to addressing violent crime remains a disgrace.

A meagre R200 million has been allocated to the Department of Health, while it is struggling with more than R4 billion in accruals.

While dealing with a R770 million shortfall the Education Department, was allocated less than R11 million. Health and Education are two of our most vital sectors and should not be subject to this level of neglect. The lack of a clear financial turnaround plan for both sectors is deeply concerning.

Reducing the budget for the Department of Cooperative Governance and Traditional Affairs (CoGTA) by almost R9 million is another red flag. This further demonstrates the provincial government’s disregard for the growing local government crisis, where municipalities are collapsing under financial strain and mismanagement. We need immediate intervention and support for local government, not budget cuts.

The DA will continue to fight for the Eastern Cape government to compile a serious financial turnaround plan, foster strategic partnerships, and to commit to economic recovery.

Regards

Dr Malcolm Figg MPL
DA EC Shadow MEC for Finance

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