State spending is sustainable
DESPITE rising debt levels and increased social spending, South Africa is on a sustainable fiscal path, Deputy Finance Minister Nhlanhla Nene said yesterday.
Social expenditures, which include assistance grants and health and education spending, account for 58% of government expenditures compared with 49% 10 years ago.
The number of social grant beneficiaries reached 15,6-million in March 2012, Nene said.
"Preliminary indications are that the trajectory of social spending as it currently stands in the budget is sustainable," he said.
Nene said South Africa needed to stabilise the growth of the country's debt, currently standing at about 35% of gross domestic product and reiterated that the growing government wage bill was of great concern, citing it as the second-fastest growing component of spending.
"This would not be a problem if productivity of public officials were also rising strongly, but we know that government falls short on many fronts where service delivery is concerned," Nene said.