Chair, as set out in the Medium-Term Budget Policy Statement, there will be no upward adjustment of spending projections in the Medium- Term Expenditure Framework period over the first two years of the MTEF period and only moderate growth in the outer year. This is both prudent and welcome, given the current tough economic environment.
Government's concern is that additional budget allocations do not result in commensurate improvements in service delivery because of the poor quality of spending, as well as the composition of such spending on consumption rather than on capital investment, which is real and requires corrective action.
The reprioritisation by government departments away from programmes that are not meeting performance requirements is therefore welcomed and has made it possible to effect savings of some R40 billion over the next three years. The R40 billion saved made it possible for government to fund the revisions of national expenditure for 2012-13.
There is a question, however, as to how many other amounts of R40 billion are lying around in the system, which have not been recouped but, if recouped, could have greatly contributed not only to better achieve the priorities of government, but would also have assisted in reducing the current projected 4,8% of GDP budget deficit much quicker.
Where then can government search for some amounts of R40 billion lying around? The first option is to take money away from government departments that are consistently underspending against budget, such as Public Works, or departments that have spent everything but failed to come even close to attaining their predetermined targets and objectives. The Department of Justice and Constitutional Development, for instance, spent 99,9% of its budget but only attained 33% of its predetermined objectives. Total underexpenditure by government departments during the 2011-12 financial year amounted to R11,4 billion. In monetary terms, this figure has been growing steeply over the past few years.
Another option is to stop paying exorbitant amounts for consultants and implementing agents doing work for departments that should have been done by employees themselves, which employees lack the required skills and experience, because they were appointed on the basis of who they know and not on what they know. Appointments must be competency-based so as to build capacity.
Another option is to stop spending on items where there is no clear distinction made between party and state, such as the R238 million spent on the President's house in Nkandla and on the centenary festivals of the ANC. [Interjections.]
The fourth option is to stop paying performance bonuses to staff where the predetermined objectives of the department have not been met or where the department received unqualified with findings reports or qualified audit reports.
Another option is to close unnecessary institutions, such as the National Youth Development Agency which has advanced loans to young people without doing credit checks and which, according to the Auditor-General, is likely to have to write off R166 million as a result. In addition, it incurred irregular expenditure of R133 million during the 2011-12 financial year.
Another option is to stop funding defunct government departments, such as the Department of Women, Children and People with Disabilities. This department's budget, which includes a Minister as well as a Deputy Minister, will exceed R190 million this year. One could also rationalise state-owned enterprises.
The sixth option is to start fighting corruption with real intent and include Members of Parliament who are guilty, some of whom still sit here. On the anticorruption hotline, for instance, only 6% of government and provincial departments have a closure rate in excess of 80%. At the same time, action steps must be taken to curb and avoid fruitless and wasteful expenditure, irregular expenditure, and unauthorised expenditure which totalled R6,67 billion in the past financial year.
Another option is to prohibit government officials and public representatives from contracting with the state. Only 48% of senior managers in national and provincial departments declared their registrable interests, as required, timeously. No wonder corruption by government officials, according to the Public Service Commission, amounted to nearly R1 billion in the past financial year. In virtually 75% of these cases, no action was taken against the perpetrators.
One could also institute proper controls to ensure effective spending of monies transferred to provinces and municipalities. Also, one could dismiss and replace incompetent government employees in all three spheres of government, and also in state institutions such as Denel that has to fork out another R118,3 million for contractual penalties in respect of the A400M aircraft contracts. One could also fill only those vacancies that are crucial for effective service delivery.
Another option is to strengthen the function and independence of internal audit committees, and ensure that salary increases for government employees are related to increases in performance and higher productivity. Lastly, one could substantially reduce the number of Deputy Ministers, most of whom were appointed merely as a reward for backing President Zuma at Polokwane.
I have outlined just a few areas in which billions of rand are wasted, lost or could be saved. Only with a concerted effort to curb wastage and corruption will government be able to recoup the billions of rand required to fulfil its service delivery function, eradicate poverty, create jobs, redress the injustices of the past, ensure reconciliation in our diverse society, and create an environment in which economic growth is ensured.
Ons doen dit in DA-beheerde regeringsaanstellings. Probeer dit gerus en smaak ook sukses. Ek dank u. [Applous.] [We do it with DA-controlled government appointments. Dare to try it and also taste success. I thank you. [Applause.]]