PSC encourages treasury to tread carefully to bring down runaway spending
The Public Service Commission (PSC) has warned the National Treasury against implementing a blanket approach as it tries to bring down the government’s runaway spending.
It’s understood treasury has touted a number of cost-cutting measures ahead of the Mid-term Budget Policy Statement on 1 November 2023.
The country’s weakening fiscal position has prompted urgent calls for cost-cutting measures by the government.
Last month, the National Treasury issued a letter to national and provincial departments detailing the fiscal challenges faced by the government in the current financial year.
In the letter, the National Treasury says the country’s budget shortfall is a result of a drop in tax revenue and tighter borrowing conditions.
The ballooning public service wage bill also remains a major concern.
In response, the National Treasury’s cost-cutting proposals include a moratorium on new appointments in the public sector, as well as freezing new infrastructure projects.
The PSC’s Anele Gxoyiya says the National Treasury must perform a fine balancing act.
“What National Treasury is trying to do is to get government departments to cut on frills but not to hinder service delivery and the government’s responsibility is not about maximizing profits. So, it can’t be about saving at all costs.”
Treasury says the executive and schedule 2 public entities – which include some state-owned companies – are exempt from the proposals to limit spending.
-EWN
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