SA government’s massive provincial salary bill

The latest financial information released by Statistics South Africa (Stats SA) has revealed an 8.6% increase in provincial government salaries spend in 2014.

Financials for provincial governments shows that there was a net cash surplus of R5.06 billion at the end of the 2014 financial year, down from a surplus of R6.55 billion the previous year.

Total cash receipts for the year amounted to R430 billion, including R113 million from the sale of non-financial assets.

Total cash payments amounted to R425 billion, including R394.21 billion outflows, as well as R30.8 billion in purchases of non-financial assets.

By far, provincial governments spend the biggest bulk of their available cash on paying employees, with total compensation for employees amounting to R254 billion for the year, up 8.6% from R234 billion in 2013.

This equates to about 60% of total expenditure.

South Africa employs around 2.2 million public servants nationally, including approximately 1.7 million provincial government employees.

This means that each provincial government employee is paid, on average, around R150,000 per year.

The increase of R20.06 billion in compensation of employees from 2012/2013 to 2013/2014 was mainly due to increased payments by the KwaZulu-Natal, Gauteng and Eastern Cape provincial governments, Stats SA said.

Looking at the provincial stats, KwaZulu Natal has the highest salary bill at R54.5 billion, while the country’s most populous province, Gauteng, is second with a bill of R44.3 billion. Both provinces saw a spike in salary payments totalling over R4 billion.

Government salaries by province

Where is the money going?

Stats SA also broke down the total expenditure (including salaries) by sector, showing which areas saw the most finances flow into them.

Of the R425 billion spent by provinces in 2014, education was the biggest taker, with R181 billion – or 42,6% – of the total spent.

This is followed by:

  • Health (R127 billion or 29,9%);
  • Economic affairs (R46.3 billion or 10,9%);
  • General public services (R22.4 billion or 5,3%);
  • Housing and community amenities (R19.6 billion or 4,6%);
  • Social protection (R13.9 billion or 3,3%);
  • Recreation, culture and religion (R7.1 billion or 1,7%);
  • Public order and safety (R4.6 billion or 1,1%); and
  • Environmental protection (R2.9 billion or 0,7%).

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SA government’s massive provincial salary bill