By Celeste Ganga
20 February 2008
Several steps in extending social security over the period ahead were announced in the 2008 Budget, tabled in Parliament by Finance Minister Trevor Manuel on Wednesday. According to the minister, the social grant increase will match or exceed inflation, and take into account the disproportionate impact of price increases on the poor.
“The maximum values of the disability and old age grants will increase by R70 a month to R940 in April this year, while the child support grant will increase by R10 in April and by a further R10 in October, to R220 a month,” Manuel announced.
The total number of grant beneficiaries is 12.4 billion, and expenditure on social assistance will be R75.3 billion next year.
“The qualifying household income threshold for the child support grant will be raised and the means test formula that applies to the old age grant and disability grant will be revised, contributing both to easier administration of these restrictions and broader access of the poor to income support,” explains Manuel.
Meanwhile the child support grant will be extended to include children up to the age of 15, which will take effect from January 2009. Also the age of eligibility of men to receive old age pension has been reduced to 60.
'Health Services growth to increase by 10%'
With regard to the Health sector, improved remuneration and training have contributed to an increase in health personnel of 39 600 over the past four years. In addition to this, 25 000 posts will be filled by 2010, South Africans were told.
“The hospital revitalisation programme is targeted for additional allocations, the conditional grants for HIV and Aids will increase and tertiary health services are prioritised,” explains Manuel.
The Minister added that, together with additional resources for multi-drug resistant and extreme drug resistant tuberculosis and for higher pay for nurses, spending on health services is projected to grow by over 10% a year over the next three years.
The budget makes allowances for the building of schools, early childhood education, school books and educator remuneration.
According to the budget, over the next three years provinces have budgeted to spend over R18 billion on school infrastructure and equipment, so that unsafe schools can be eradicated.
On the issue of safety, R2.7 billion will go towards information technology infrastructure, police forensic laboratories and additional police personnel as well as R2 billion for correctional facilities.
“The expansion of early childhood education to about 60 000 more children will put basic pre-school education within reach of even the poorest of households,” says Manuel.
R1.4 billion will go towards higher education, research and knowledge development.
He adds that in addition, the school nutrition programme will increase by over 30% next year in order to feed more children, in more schools, more days of the year.
In the 2007/08 financial year, total education spending exceeded R105 billion. This being something that the Minister says rightly signifies that investing in the capabilities on which dignity, self-reliance and social progress are built; is at the center of their development strategy.
“Education is central to our objective of broadening opportunity and fighting poverty,” says Manuel.
Energy: ‘Up to R60 billion provided for Eskom’
The minister has proposed that R60 billion should be provided to support the financing of Eskom’s investment programme, on terms, structured to assist in meeting cash flow requirements. This comes after the utility’s balance sheet is predicted to undergo some “stress”.
Manuel was adamant in saying that this is not a grant. “The return on an investment in power generation is very long term, and the repayment of debt must be similarly deferred,” he said.
He adds that the government would not be supporting these investments if they were not confident that they are economically and financially viable.
Over the next five years the utility’s capital expansion plans will amount to R343 billion, with about 73% earmarked for power generation projects.
An amount of R2 billion will be set aside over the next three years to support programmes aimed at encouraging more efficient use of electricity, generation from renewable sources, installation of electricity-saving devices and co-generation projects.
According to Manuel, “the return-to-service of previously mothballed power stations, Camden, Grootvlei and Komati, will add a combined 3 677MW of generating capacity by 2011 and other smaller projects produce about 2 000MW,” explains Manuel.
Two big new coal-fired plants, Medupi in Lephalale and Bravo near Witbank, each costing an excess of R80 billion will produce about 4 500MW each. To improve transmission capacity, Eskom is strengthening the Cape grid, and building new lines from Majuba to KwaZulu-Natal.
With regard to the general fuel (petrol and diesel) taxes, this will increase by 11cents per litre, as of 2 April 2008.