Public Sector Governance and Accountability Series: Budgeting and ...

506 Alta Fölscher
Better Access to Services
The growth in social service expenditure was driven by an expansion of the social
security system, with approximately a quarter of the population receiving support
grants from the state. This increase has had a direct effect on alleviating
poverty in the country and mitigating the effects of HIV/AIDS. One of the fastestgrowing
grants has been the disability grant, which benefits people living with
HIV/AIDS. Beneficiaries of the grant doubled between fiscal years 2001/02 and
2004/05 (to 1.3 million), and spending almost tripled.
The first 10 years of democracy have also seen investment in social infrastructure
to improve access to basic services. The drive included building 1.6
million houses, improving access to schooling for the poor, constructing and
upgrading primary health clinics, and extending and improving potable water
supplies to 9 million people and sanitation facilities to more than 6 million
people. This activity has affected the quality of life of millions, as demonstrated
by improved access to water, shelter, sanitation, and energy as measured
in the general household survey.
Source: National Treasury of South Africa 2004a, 2006a, 2006b.
for the financing of large infrastructure projects have already been developed
and are being implemented. Examples are toll roads, hospitals, prisons, government
buildings, and tourism initiatives that attracted significant amounts
of private sector investment. South Africa has also gained good experience
with the use of specialist agencies to deliver discrete services. Examples of successful
reforms include the Roads Agency, the Legal Services Board, and the
National Water Resource Infrastructure Agency.
Reform of the Budget System
Management of South African public finances has undergone many reforms
over the past decade. These reforms can be bundled into sets of interconnected
concerns: integrating the intergovernmental system and the annual budget
process, establishing a credible budget process, establishing credible budgetary
rules for decision making, establishing credible budgeting institutions,
reforming the classification system and chart of accounts, and reforming the
institutions of public financial management.
Integration of the Intergovernmental System and Annual
Budget Process
The annual budget process provides the vehicle for the practical fulfillment
of the constitutional and legislative requirements. The share of available