Budget Brief No. 98

"Spending under control, but structural issues remain
Following adjustments in the mid-1990s, the public sector salary bill in South Africa grew rapidly, which squeezed out capital and other developmental expenditures, especially at the provincial level. This trend has been halted, and personnel expenditure is expected to fall below 35 per cent of total consolidated national and provincial spending over the 2002/03 to 2004/05 Medium Term Expenditure Framework (MTEF) period. The analysis shows that the wage agreement signed last year has contributed to upward adjustments in allocations for the remuneration of employees. At the same time, inflation instability makes it likely that Budget 2002 will be subject to in-year adjustments, particularly with regard to personnel expenditures. In addition, structural issues driving personnel expenditure, especially at provincial level, still require attention."

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