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IOL News
2 days ago
- Business
- IOL News
Budget cuts expose SA's public service crisis
While the government touts nominal increases in budget allocations, the harsh truth reveals a significant erosion of real-term funding. Image: Rawpixel/Freepik AS South Africa grapples with deepening inequalities and a faltering public service, the recently adopted Budget Vote Reports for 2025 expose a troubling reality: while the government touts nominal increases in budget allocations, the harsh truth reveals a significant erosion of real-term funding. The Department of Public Service and Administration (DPSA), Public Service Commission (PSC), and National School of Governance (NSG) all face budget cuts that threaten to undermine service delivery and exacerbate existing disparities. In a virtual meeting this week, the Portfolio Committee on Public Service and Administration, chaired by the DA's Jan Naudé De Villiers, confronted these critical issues head-on. The reports presented revealed a complex interplay between budget allocations and the pressing needs of public service delivery. Julius Ngoepe, the committee content advisor, noted that the overall budget allocation for the DPSA for 2025/26 stood at R564 million, reflecting a nominal increase of 4.67% from R539m in 2024/25. He pointed out: 'This amount represents a decrease of 0.03% in real terms,' highlighting the painful reality of inflation outpacing budgetary growth. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Ad Loading The DPSA's budget over the Medium-Term Expenditure Framework (MTEF) period is projected at R1.8 billion, with a staggering 54.4%, or R966m, earmarked for the compensation of employees (COE). This allocation raised critical questions about the sustainability of service delivery, particularly as spending on transfers and subsidies accounts for only 10.2%, or R178m, with R158m designated for the Centre for Public Service Innovation (CPSI). During the meeting, members voiced their concerns regarding the budget's failure to address systemic inequalities within the public service. The EFF's Sixolisa Gcilishe, lamented the budget's failure to address systemic inequalities: 'The budget failed to address systematic inequalities in the public service as reflected in the wage disparities between top and lower management.' She further highlighted the inadequacy of the R300m allocated for administration in Programme 1, saying: 'Frontline workers remain underpaid,' and questioned the effectiveness of the budget cuts on service delivery. The chairperson acknowledged the gravity of these concerns, saying: 'This was an internal meeting to consider and adopt the DPSA, PSC, and NSG Budget Vote Reports.' He emphasised the importance of documenting these discussions, urging members to reflect their views in the report. Gcilishe insisted that 'the comments should be reflected in the report because the government would not be aware if they were only made in speeches and not documented'. The meeting also saw a significant push for changes in the funding model for the Thusong service centres. The DA's Leah Potgieter proposed: 'The funding should be split among the various departments that were making use of the centres,' leading to an amendment in the recommendation. National and provincial departments providing services in the Thusong service centres should co-fund the centres to ensure their long-term sustainability.' As the discussion progressed, the committee grappled with the implications of budget cuts on service delivery. The committee secretary, Masixole Zibeko, advised that some comments should be added to the report while others should be reserved for the Budget Debate. He cautioned members against introducing new recommendations at this stage, saying: 'Members had opportunities on two previous occasions to do so.' The sentiment of dissatisfaction with budget cuts was echoed by Ngoepe, who said: 'Every sector had expressed dissatisfaction with budget cuts.' This sentiment was further reinforced by the MK Party's Japhta Malinga, who warned that adding new issues at this stage was 'not doing justice to the process'. The chairperson agreed, saying: 'The DPSA had a role to play, but solving youth unemployment was not the sole responsibility of the Department.' The NSG's budget allocation for 2025/26 was also scrutinised, with Ngoepe presenting a budget of R228m, a nominal increase of 4.5% from R218m in 2024/25. Potgieter raised concerns about the allocation of more than 51% of the budget for administration rather than training programmes, saying the bloated administration and minimal training should be highlighted in the report. The chairperson acknowledged this as a valid concern, noting: 'This is a general concern in almost every department across government.' In the PSC report, the overall budget allocation for 2025/26 is R302m, which represents an increase of 4.68% in nominal terms but a decrease of 0.02% in real terms. Langa emphasised the need for security measures for PSC commissioners, saying the critical role of the PSC commissioners and the need for protection against threats at all times should be reflected in the report.
The Herald
19-06-2025
- Business
- The Herald
Joburg rates will rise in July
Moraka said the city's financial footing was still fragile but with the plans the city had communicated to the National Treasury regarding its collections, managing of water and electricity losses, and expenditure, he was confident the city would see a full financial recovery in the medium term. 'We are still stable, and you can see this with our credit ratings. Even your banks are still investing in the city in terms of loan funding and capital expenditure. We would want that to move forward and ensure that we are liquid sufficiently and be able to reinvest our own cash into our infrastructure.' He conceded that the size of the city posed a challenge, indicating the capital expenditure budget should ideally be sitting at R15bn. 'At the moment, we are limited in terms of what we can invest and that is the reason that we are in talks with DPSA (department of public service & administration) to look at off-balance sheet investments. Big metros, in particular Cape Town, eThekwini and ourselves, are self-reliant in terms of where we are going to get funding. 'Whatever plans we have as the City of Johannesburg we rely on tariffs and the collections thereof. We do not have the luxury of SOEs (state-owned enterprises) in terms of bailouts and the like. Understanding the terms and where the city is coming from when we set these tariffs is quite important.' Moraka criticised the outcry over tariff increases, particularly for water and electricity. 'Eskom is the generator of electricity and we are a distributor, we've got the distribution networks. As a generator, their tariff increase has got an impact on what we set as the distributor. If the tariff approved by Nersa is 12.74% for the generation of electricity, then the city has to set a cost-reflective tariff.' He said they decided not to increase tariffs at the same rate, saying this was the result of key deliberations with the Treasury. 'In their view, we should increase at the same proportion as what the bulk generators increase by. But our argument was that we are already seeing an overburdened resident and business in the City of Johannesburg and we must plough back into their interests and ensure efficiencies within our own systems. So whenever there are leakages, we must intervene.'
The Citizen
09-06-2025
- Business
- The Citizen
Ghost workers thrive while youth struggle for jobs, parliament warns
While unemployed graduates queue for opportunities, fake employees are drawing state salaries unchecked, and sometimes protected. Chairperson of the portfolio committee on public service and administration, Jan de Villiers. Picture: /@ParliamentofRSA While thousands of unemployed graduates struggle to enter the public service, parliament has warned that systemic corruption is enabling ghost workers to drain public funds, taking jobs and resources meant for real people. The chairperson of the portfolio committee on public service and administration, Jan de Villiers, said this during the governance oversight committee's briefing on Monday. This follows a committee meeting on 28 May to address payroll fraud and youth employment in government. 'Every ghost worker represents a post that could have been filled by a qualified graduate, a dedicated nurse, a teacher in a rural school, or a social worker supporting the vulnerable,' said De Villiers. Ghost workers are not errors De Villiers confirmed that ghost workers are not a matter of administrative oversight, but the result of 'deliberate and orchestrated systemic corruption,' requiring collusion between at least three internal officials. The Department of Public Service and Administration (DPSA) acknowledged to Parliament that ghost employees exist across all three tiers of national, provincial, and local government, as well as in state-owned entities. In one case, the auditor-general uncovered R6.4 million in fraudulent salary payments at the Mpumalanga Department of Education. In May 2025, 230 unverifiable employees had their salaries frozen by the Gauteng Department of Health. 'Real people are drawing fraudulent salaries, and real taxpayer money is being siphoned into private pockets under the guise of legitimate employment,' De Villiers said. ALSO READ: State capture allegations come back to haunt RAF acting CIO Young professionals sidelined The committee also flagged serious concerns about youth employment in the public service, especially during Youth Month. According to the DPSA, youth aged 31 to 35 make up 27% of the workforce, more than 347 000 individuals, with most in finance, admin and technical roles. Yet many face poor mentorship, lack of formal skills recognition, and limited opportunities for absorption into permanent posts. 'Placements without professional development or recognition are insufficient. 'We must build a future-ready public service,' said De Villiers. The committee is pushing for early retirement schemes to create space for young professionals, but insists that only transparent, merit-based recruitment will restore trust. 'It is a national imperative to prepare the state for the future,' De Villiers concluded. NOW READ: SA's shrinking mining sector and the policies that brought us here
The South African
25-05-2025
- Business
- The South African
DA slams R400 million salaries of CEOs of failing state-owned entities
The Democratic Alliance (DA) has condemned what it describes as 'exorbitant' executive salaries within South Africa's state-owned enterprises (SOEs), calling for immediate reform and accountability in the wake of shocking new data revealing over R400 million spent annually on executive pay – despite ongoing bailouts, service delivery failures, and poor audit outcomes. According to parliamentary responses and publicly available remuneration data, senior executives at public entities are earning salaries that far exceed national guidelines set by the Department of Public Service and Administration (DPSA), with little regard for performance or fiscal sustainability. 'This reflects a broken system with weak oversight and eroded public accountability,' the DA said in a statement. The DA highlighted several examples: The Development Bank of South Africa (DBSA) CEO earns R15.5 million annually , making them one of the highest-paid public servants in the country. CEO earns , making them one of the highest-paid public servants in the country. Transnet's CEO pockets R8.5 million , even as the entity struggles with port inefficiencies and increasing reliance on the private sector after receiving a R47 billion bailout in 2023. pockets , even as the entity struggles with port inefficiencies and increasing reliance on the private sector after receiving a in 2023. At the Passenger Rail Agency of South Africa (PRASA) , the CEO earns R7.8 million , despite the agency's ongoing infrastructure woes and audit disclaimers. , the CEO earns , despite the agency's ongoing infrastructure woes and audit disclaimers. The Road Accident Fund (RAF) CEO receives R7.1 million, while the fund remains technically insolvent. Other entities named in the report include the CSIR (R6.92 million), SAA (R6 million), Rand Water (R5.4 million), and PetroSA (R5.8 million) – many of which continue to underperform or rely heavily on government support. The DA warned that this level of spending undermines service delivery and public confidence in the government's ability to manage state resources effectively. With only 13 of 40 government departments reporting so far, the total national expenditure on executive pay could be significantly higher than R400 million. 'If such excesses are occurring at senior levels, it is reasonable to infer that similar practices may exist across all employment tiers within SOEs,' the DA said. The party is demanding that the Minister of Public Service and Administration, along with the Minister of Finance, implement the following: A standardised executive remuneration framework for all public entities for all public entities Mandatory justification and public disclosure of any salary exceeding DPSA guidelines of any salary exceeding DPSA guidelines Parliamentary oversight and collaboration to ensure alignment with public service principles They argue that executive pay should reflect performance, especially in entities that have repeatedly failed to deliver on their mandates or required state bailouts. The DA has described the excessive salaries as an 'affront' to millions of ordinary South Africans who continue to endure failing services, from collapsing rail infrastructure to persistent water outages and electricity disruptions. 'The South African public deserves competent and ethical service delivery. These excessive salaries remain not only unjustifiable but an affront to the millions who rely on basic services that are consistently failing.' The DA has vowed to pursue fiscal discipline and performance accountability through legislative channels and continue exposing what it sees as a culture of excess and impunity in state entities. Let us know by leaving a comment below, or send a WhatsApp to 060 011 021 1 Subscribe to The South African website's newsletters and follow us on WhatsApp, Facebook, X and Bluesky for the latest news.
IOL News
19-05-2025
- Politics
- IOL News
Enhancing governance: New initiative to collect data on foreign national public service workers
The Department of Public Service and Administration (DPSA) said it has launched a wide-ranging data collection initiative focused on foreign nationals in a bid to bolster governance and national security. Image: Independent Newspapers Archives The South African government has launched a data collection initiative targeting foreign nationals in public service to enhance governance and national security, addressing public concerns about undocumented workers. The Department of Public Service and Administration (DPSA) said it has launched a wide-ranging data collection initiative focused on foreign nationals in a bid to bolster governance and national security. The initiative, which is already under way, aims to plug information gaps in existing systems and ensure compliance with national employment standards. According to the department, while the PERSAL system captures most employment-related information, it does not provide the full picture when it comes to foreign nationals working in public roles. 'This current request for data is vital, as the PERSAL system, while comprehensive, does not always capture all necessary information for effective policy formulation and public administration,' the DPSA said. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ The department underscored that this effort is not only about collecting figures but about refining the quality of data. 'Our commitment to data integrity means that we are not only gathering information but also verifying and analysing it to ensure a comprehensive overview once the process is complete.' The DPSA's move comes amid growing public concerns around undocumented or poorly recorded foreign nationals, especially within critical sectors like healthcare. However, the department has poured cold water on claims that '90% of foreign nationals in public health lack documented data.' 'Any claims regarding data deficiencies must be substantiated with credible information,' it stated. 'We are working with departments to ensure that all relevant data is current and correctly captured,' the department said. National security concerns also loom large in the department's reasoning. 'Our existing directive on the Employment of Foreign Nationals outlines strict norms and standards to ensure that such employment does not compromise state security,' the DPSA explained, adding that it works closely with security agencies to 'update our directives in response to evolving national security needs.' While some may see this as a heavy-handed tactic, the DPSA insists that the drive is about strengthening ethical governance. 'We view this initiative as an opportunity to strengthen governance and improve public service practices,' the department said. 'Our approach emphasises accountability and transparency, with the goal of developing a resilient public administration.' With data now being consolidated and analysed, the department said it continues to support individual public service departments to ensure accurate reporting. THE MERCURY
