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Budget hands over R12 billion to fight HIV/AIDS
Andre Koopman and Charles Phalane. 12 November 2003. Cape Argus. Republished courtesy of Independent Newspapers (Pty) Ltd.
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A total of R12-billion is budgeted for a roll-out of anti-retrovirals over the next few years and the cabinet is expected to announce the details on Wednesday afternoon, Finance Minister Trevor Manuel said.
"We've committed the money... the total has been growing," Manuel said at a press conference in parliament on his medium-term budget policy statement.
"I left cabinet earlier today, but I know that we've budgeted for the amounts," Manuel said in response to a question. "We are talking of a total of just under R12-billion, if my memory serves me, over the period."
Wednesday's medium-term budget statement, which makes adjustments to the 2003 budget announced in February, provides for an extra R1,9-billion for HIV and AIDS over the next three years, over and above the R3-billion allocated to provinces for the roll-out over the corresponding medium term announced in February.
Treasury officials said an operational plan before the cabinet on Wednesday set out the details of the roll-out, including 77 treatment sites across the country and a plan to recruit and train medical staff.
In Wednesday's medium-term statement, Manuel also signalled extra state funding to create jobs, boost education and fight crime.
He indicated that he may again conduct a tax-paring exercise next year.
The government exceeded its income projection by R6,8-billion in the 2002/03 financial year, but expects a revenue shortfall of almost R5-billion next year, because corporate profits have fallen due to the global economic slowdown and the strong Rand.
But Logan Wort of the Treasury said there had been a saving on debt service costs of around R4-billion - which may put Manuel in a position to provide significant tax relief.
Among the highlights:
- An enhanced commitment to fighting HIV and AIDS, including a progressive roll-out of anti-retroviral drugs and support measures.
- A renewed focus on job creation, in part through an expanded public works programme. Along with social job-creation programmes, the government is predicting it will create a million jobs over the next five years.
- Improving the quality of school education through targeted allocations directly to poor schools.
Manuel said the government intended expanding access to learning to more than 80 000 people by March 2005, with a focus on the jobless.
An extra R3-billion will be spent over the next few years on the transformation and recapitalisation of higher-education institutions and to deal with rapid growth in the numbers benefiting from skills programmes".
- The safety and security budget is being boosted by R83,4-million to expand capacity in the sector and establish a new protection and security services division.
- There will be investments in neighbourhoods and communities, and the extension of free basic services and municipal infrastructure.
- Improving core services of Home Affairs to citizens, particularly in rural areas, with the department's budget being increased by R161-million.
- A deepening commitment to promoting peace in Africa, and support for regional trade and development.
An additional R500-million was allocated to peace support missions in Africa, including 800 additional troops requested by the UN for peacekeeping in the Democratic Republic of the Congo.
The strengthening Rand has allowed the Defence Department to save almost R1-billion this year on the multibillion-rand arms deal.
This has resulted in a budget cut for defence of R250-million.
Further extension of social grants will take place, particularly targeting children and other vulnerable groups.
For the current year, social service spending is expected to increase to R192-billion.
Provinces will receive an additional R2,1-billion for unavoidable expenditure due to higher than anticipated growth in beneficiary numbers, especially for the disability grant.
A separate adjustment of R100-million had to be made to support the phased extension of the child support grant to children aged seven and eight this year.
According to the framework, grants will be extended to children aged nine and 10 and 11 to 13 in 2005/6.
The drought that has hit parts of South Africa has necessitated an additional allocation of R250-million to mitigate its effects and those of forest fires.
A R400-million once-off allocation has been set aside for service benefits of departing members of the national and provincial legislatures.
Revenue is expected to fall short of the February estimate for this year by about R4,6-billion to R299,9-billion, mainly because of the decline in corporate profits in the wake of the economic slowdown and the effect of a stronger rand.
The February budget forecast revenue at R304,5-billion. The budget deficit has been adjusted upwards from the forecast 2,4 percent of gross domestic product in February to 2,6 percent of GDP.
But interest expenditure is expected to be R3,8-billion less than budgeted, while non-interest expenditure has been adjusted upwards by R1,3-billion. The net effect is a budget deficit higher than the February estimate.
The public sector borrowing requirement will rise as a consequence. Manuel said the budget deficit was expected to rise again in 2004/5 to 3,2 percent of GDP, and to stay at 3,1 percent the following year before easing again.
Although GDP growth was expected to slow to 2,2 percent this year, more robust performance was expected in the years ahead. It is expected to grow to 3,3 percent next year and 3,7 percent in 2005 and four percent in 2006. Inflation was expected to remain within the targeted range of three percent to six percent in the next three years, he said.
The decline in prime interest rates was expected to contribute favourably to prospects for both domestic consumption and investment trends, Manuel told the house.
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