Goverment will set a cap on the use of consultants, place limits on what it spends on litigation and penalise departments and state entities for bad governance by withholding transfers and guarantees as part of its plan to reprioritise funding to meet the goals of the National Development Plan (NDP), Planning, Monitoring and Evaluation Minister Jeff Radebes aid on Thursday.
Speaking during a media briefing ahead of the 5th anniversary of the adoption of the NDP which takes place on September 12, Radebe said Cabinet last month approved Mandate Paper 2018 – to guide the budgeting process.
With limited resources, the overall medium-term budget for 2018 could not be increased, meaning there was no new money and government would have to reprioritise funds to pay for the implemenation of key areas in the NDP.
“There is a decision of Cabinet that we should not exceed the ceiling that has been set that’s why in terms of funding programmes we have to reprioritise,” said Radebe.
“We are not going to be rewarding bad governance or lapses in good corporate governance. The mandate paper is both a stick and a carrot.”
According to Radebe aggressive cost saving measures would include:
- Limiting the use of consultants through capping this expenditure item;
- Strict limits on contingency liabilities and litigation costs through developing a mechanism with the Department of Justice to determine cases to be defended or for arbitration;
- Optimising state procurement by setting pricing parameters and centralising procurement of major items, as well as improving contract management and procurement compliance;
- Improving returns and value for money from state infrastructureprojects, also through combatting collusion and strengthening project management to prevent cost escalations due to delays; and
- Insisting on good governance and penalising lapses in governance by withholding transfers and/or guarantees.
Radebe said the Mandate Paper, approved by Cabinet in August, was developed along with National Treasury. It would be discussed in meetings of the medium-term expenditure commitee which will make recommendations to minister’s committee on the budget.
