Financial Fiscal Commission Annual Revenue Submission
Date: Jul 6, 2022 | Public & Environment Economics Research Center
PEERC’s director Mr Jugal Mahabir together with Dr Seun Muller a senior research associate recently concluded a study for the Financial Fiscal Commission’s 2023/2024 annual submission for the division of revenue. One of the research projects focused on the financing of basic education and the implications of possible budget cuts due to fiscal consolidation.
With the onset of the Covid-19 pandemic and the government’s response to it, the Commission raised three issues that prompted this research. The first relates to the impact of constant budget reprioritizations in key sectors, especially those responsible for services underpinning the realisation of Socio Economic Rights. The practice of successive/constant reprioritization pre-dates the pandemic but was particularly pronounced with the tabling of the Supplementary Adjustment Budget in 2020. Secondly, with the tabling of the 2021 Budget, widespread cuts were effected across a range of sectors – the Commission noted that Budget 2021 represented the first time since the adoption of the Constitution that a budget has unambiguously proposed a substantial reduction in the real value of allocations to public services underpinning several of the SERs outlined in the Bill of Rights, such as, for example, a clear reduction to social assistance grants. Finally, the Commission expressed concern that neither the Budget Speech nor the Budget Review referenced the state’s constitutional obligations regarding these matters. There was also no indication that the government has considered how the rights contained in the Constitution will be protected in the context of declining resource allocations, especially since the reductions are likely to continue for several years. How then can South Africa protect spending on SERs enshrined in the Bill of Rights, irrespective of the fiscal environment?
The research proposed using an SER lense to develop the foundation of a budget prioritisation framework that identifies and seeks to protect spending on the essential components associated with the right to basic education.
The research aimed to analyse the following: How has basic education-related revenue and spending evolved? What are the essential elements associated with the right to basic education in South Africa? What are the budget and spending items associated with the core components identified above?
The analysis and findings of the above research can be found in chapter 9 of the FFC’s Annual Revenue Submission. This can be downloaded here
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