(The following debate was delivered in the KZN Legislature during a Sitting held today)
Today, the Democratic Alliance (DA), as a committed partner within KwaZulu-Natal’s (KZN) Government of Provincial Unity (GPU), reflects on the outcomes of the 2024/25 Unaudited Close-Out Reports. These reports are not merely financial documents – they are a mirror of governance, priorities and performance. They indicate where government has succeeded, where it has faltered and where urgent corrective action is required.
Allow me to begin by acknowledging the scale and complexity of the provincial budget. More than R167billion was appropriated across 14 votes, covering critical sectors such as education, health, transport, agriculture and economic development. The DA commends departments that have demonstrated fiscal discipline and service delivery alignment. However, we must also confront the uncomfortable truths revealed in these reports.
• Budget Execution and Overspending
While most KZN government departments spent more than 95% of their budgets, Vote 5: Education overspent by R516million and Vote 7: Health spent its entire allocation, despite facing a contingent medico-legal liability of R3.3billion. These are not just numbers – they represent systemic pressures that, if left unchecked, will destabilise future budgets and compromise service delivery.
Given this, the DA calls for a comprehensive review of compensation structures, particularly within Education and Health, where Compensation of Employees (CoE) exceeded 100% of the final appropriation. Provincial government must ensure that wage agreements are sustainable and aligned with performance outcomes. It must also support the Treasury initiative, under the leadership of MEC, Francois Rodgers, to comprehensively exclude ghost workers from the system.
• Accruals and Payables: A Ticking Time Bomb
The reports reveal a disturbing trend. A staggering R3.2billion in unpaid accruals in Transport, R1.6billion in Education and R3.2billion in Health. These are not mere accounting anomalies – they are unpaid bills that will roll over into 2025/26, squeezing already constrained budgets.
The DA urges Provincial Treasury to implement stricter controls on accrual management and enforce compliance with Public Finance Management Act (PFMA) regulations. Departments cannot be allowed to operate on deferred obligations while service providers – many of them Small, Medium and Micro Enterprises (SMMEs) – face financial ruin due to delayed payments. The DA further demands that all departments submit credible plans to manage the expectations of their creditors, in order to avoid wasteful expenditure due to court actions.
• Infrastructure Spending: Progress and Pitfalls
Infrastructure remains a cornerstone of development. The DA notes, with appreciation, that Transport completed 510 of 571 flood repair projects while Education delivered 22 new schools and 117 storm repairs. However, Health under-spent R101million on new infrastructure, citing contractor delays and poor performance.
The DA urges Health to strengthen its project management capacity and ensure that infrastructure funds are not only spent but spent effectively. We also call for greater transparency in contractor selection and performance monitoring.
• Conditional Grants: Utilisation and Accountability
Conditional grants are vital tools for targeted interventions. The DA commends departments such as Health and Transport for fully utilising their grants. However, the Comprehensive Agricultural Support Programme (CASP) under Vote 3 spent only 72.5% of its allocation due to delays in the Richards Bay Industrial Development Zone (RBIDZ) agri-hub project.
This is unacceptable. The DA calls on KZN’s Department of Agriculture and Rural Development (DARD) to expedite implementation and ensure that grant funding translates into tangible outcomes for rural communities.
• Non-Financial Performance: Mixed Results
Service delivery is the ultimate measure of governance. While many departments met or exceeded their Annual Performance Plan (APP) targets, others fell short. In Education, the National Senior Certificate (NSC) pass rate reached 89.5%, yet 0% of schools were funded at the minimum level. In Health, only 20 out of 35 targets were met, with serious concerns around antiretroviral therapy (ART) retention, maternal mortality and invoice payment delays.
The DA believes that performance management must be linked to budget allocations. Departments that consistently underperform must face consequences, and those that excel must be rewarded. We propose a performance-linked budgeting framework to incentivise excellence and accountability.
• Transfers to Municipalities and Public Entities
The DA is concerned by low spending rates on municipal transfers. For example, KZN’s Department of Sports, Arts and Culture transferred R374 million to municipalities but only 53% was spent. Similarly, Transport transferred R20million to Greater Kokstad, yet only 36% was utilised.
Provincial government must ensure that municipalities have the capacity to absorb and utilize funds effectively. The DA calls for enhanced intergovernmental coordination and capacity-building initiatives to prevent underspending and service delivery failures.
• Donor and Agency Funding: Underutilised Potential
Donor funding is a critical supplement to provincial resources. Yet, the reports show under-spending in key donor-funded programmes, such as the Communicable Disease Control (CDC) Award Fund in Health. The DA urges departments to improve planning and execution of donor-funded projects and to report transparently on outcomes.
• Governance and Oversight: Strengthening the GPU
As a solid partner within the GPU, the DA remains committed to collaborative governance. However, unity must not come at the expense of accountability. We will continue to play our role in SCOPA, portfolio committees and public forums to ensure that every rand spent delivers value to the people of our province.
We call on our GPU partners to support the following DA-led initiatives;
• A provincial dashboard for real-time tracking of budget and performance indicators
• A procurement transparency portal to monitor tenders, contracts, and supplier performance and;
• A citizen feedback mechanism to align service delivery with community needs.
KZN’s 2024/25 Unaudited Close-Out Reports are a wake-up call. They show where provincial government is strong, where it is vulnerable and where it must act. The first call to action must be to adopt a zero-tolerance approach against all officials that simply continue to spend at will, without fear of consequence. Such arrogance must be urgently checked and, where necessary, dealt with severely.
The DA stands ready to work with all stakeholders to build a province that is fiscally responsible, service-oriented, and citizen-focused. KZN’s GPU must not be content with spending budgets – it must deliver outcomes. It must not be satisfied with compliance – it must pursue excellence. And it must not be distracted by politics – it must serve the people.