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Thread: No surprises from Trevor?

  1. #11
    just me duncan drennan's Avatar
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    Quote Originally Posted by Marq View Post
    Where does one view the country's Annual Financial Statements and a comparison of year on year numbers against the budgets that have been set in the past?
    All the documents can be found on the treasury's site. There is a single document for the estimated income, and lots of documents for the estimated expenditure.

    There is also a summary.
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  2. Thank given for this post:

    Dave A (12-Feb-09), Marq (13-Feb-09)

  3. #12
    Site Caretaker Dave A's Avatar
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    I'm a summary kinda guy. Hopefully Marq will pick the bones out of the detail.

    What I did get out of that summary is that some of the original estimates got properly blown out of the water, particularly the domestic loans...

    Did someone say the banks were short of cash for financing homeloans?

  4. #13
    Gold Member garthu's Avatar
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  5. #14
    Site Caretaker Dave A's Avatar
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    Well, you could be right. And unless I'm misreading the situation, the domestic loan projection figures for the coming fiscal year don't look any prettier. New finance credit is going to be hard to come by.

  6. #15
    Platinum Member Marq's Avatar
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    Thanks for pointing us to the detailed financials Duncan.

    Yes OK.....seta's...mmmm....got that point.

    I still do not understand the overall financial statement reporting however.

    For me a balanced budget = income statement and a balance sheet all balancing and giving a total picture. Not one where the income = expenditure.
    I can only find an income statement and a treasury department balance sheet report.

    So where do I find a picture on total assets and liabilities showing cash brought forward, provisions for stuff, capex and assets and other normal balance sheet stuff etc.

    Having had a look through the income and expenditure summaries
    (No Dave I do not have enough time to go through all the details and have also become a summary type guy) I see that every year the actuals are fairly close to the budget. eg - budgeted revenues for 2008 was 625 actual est 611 - diff 2% down. 2007 revenues actual = 577 actual 557 - diff 3% up. Now I have been involved in many budgets from billion rand companies down to a few hundred rands but have never seen such an accurate budget before. Given the many anomalies, sources, variations, and other government related income scenarios, I find this rather hard to believe. Is this why we do not see a balance sheet where the adjustments are? It does not seem to be any different on the expense side.

    Given the problems reported within the majority of departments, the inability to produce unqualified audit reports, unaccounted for missing millions and billions, incompetence and many other adjectives describing financial abilities of those in charge, this budget process is remarkable. They manage every year to produce a 'balanced budget' where incomes and expenditures are really accurate and show that our finances are in excellent shape with department spending well within guidelines and budgets set out.

    Now I'm not suggesting that the finance department is responsible for putting forward funny numbers nor that they are responsible for anything outside the reporting of income and distribution of the loot....sorry finances.

    But, I think I have a problem with a department that reflects a great positive situation where very little appears out of place, all appears to be accounted for and everybody has a piece of the action, compared to what we are seeing on the ground with endless problems non delivery, poor systems and business processes, qualified reports, grime and corruption and squalortics.

    So poll of the day.....Does the positive financial position of the country reflect whats actually happening at grassroots level?
    Poll for tomorrow......Can one trust the budget process and its results?
    Poll for next week.....Who actually compiles the budget?
    Poll for next month....Where is the missing balance sheet?
    Poll for next year......Who has the missing millions?
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  7. #16
    Site Caretaker Dave A's Avatar
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    I think the summary is more like a cash flow statement...

    The small budget vs actual variances are pretty normal in government. If there have been big savings during the year, the department does its best to blow it otherwise their budget is reduced the next year. And when they run over budget the hurt on promotion prospects and the extra paperwork is... enough of an incentive to make damn sure it doesn't happen.
    Quote Originally Posted by Marq View Post
    But, I think I have a problem with a department that reflects a great positive situation where very little appears out of place, all appears to be accounted for and everybody has a piece of the action, compared to what we are seeing on the ground with endless problems non delivery, poor systems and business processes, qualified reports, grime and corruption and squalortics.
    I absolutely agree
    Last edited by Dave A; 13-Feb-09 at 10:58 AM.

  8. #17
    Site Caretaker Dave A's Avatar
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    Aaah! There is one surprise in the budget that has come to light.
    Children's rights organisations have reacted with outrage to Finance Minister Trevor Manuel's Budget, accusing him of contradicting the promises of his party and those of President Kgalema Motlanthe.

    Having last year announced the extension of the child support grant to 15-year-olds, Manuel this week said the government would consider extending the grant to children up to their 18th birthday only if it was affordable.
    full story from IOL here
    Trevor's position is reported here.
    The rising number of people receiving social welfare grants was "unsustainable" and the state was considering attaching conditions to the payments, Trevor Manuel, the finance minister, said yesterday.

    He said that the number of beneficiaries of state pensions and child grants had increased to 13.5-million, which was "exceedingly large".

    Last month the government lifted the maximum age for recipients of child welfare grants to 15 from 14, with the ANC committing in its manifesto to raise the age limit to 18.

    Now the state is considering adding conditions to the child grants, such as school attendance or that the money is used to buy food.

    "You can't give money away like this; there has to be conditionalities," said Manuel.
    Full story from Business Report here
    Sounds reasonable enough, but why the gap in policy? Maybe this explains it.
    Meanwhile ANC spokesperson Jessie Duarte said this week that the ANC was not considering changing the treasury’s functions. Suggestions that the treasury should be reined in reflected the views of individuals, not the ANC's official position.

    The left has criticised the powers exercised by the finance minister, who can unilaterally decide the funding of programmes.

    Under the new government, it is envisaged that the finance minister will decide on allocations in conjunction with other representatives of a planning commission, yet to be established.

    The commission will be responsible for the overarching coordination of government projects. The finance and the foreign affairs ministries will remain stand-alone units while it is suggested that environment, water, land affairs and agriculture should be grouped.

    Duarte said the ANC had not decided whether the commission should be located within the presidency or be a ministry in its own right. However, it would work with the office of the president and Parliament and incorporate all deputy ministers.

    One of the commission’s functions will be to scrutinise government departments which fail to spend money on state projects, Duarte said.

    "We need constant evaluation [of government departments]. The issue in this year’s budget is poverty reduction. We need an instrument to monitor the efficacy of departments."
    extract from M&G story here

  9. #18
    Site Caretaker Dave A's Avatar
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    Quote Originally Posted by Dave A View Post
    Having slept on it and listened to Trevor at the budget breakfast this morning, that 1.2% growth estimate might be more a goal than a hard expectation...

    But you've got to shoot at something.
    Surprise!
    South Africa's fiscal deficit will be considerably higher this financial year due to a widening tax shortfall, now seen at at least R60-billion, Finance Minister Pravin Gordhan said on Tuesday.

    Africa's biggest economy has slumped into its first recession in 17 years, knocking company tax and VAT through weak consumer spending, leading to a big revenue shortfall for 2009/10.

    "The latest revenue data suggests that tax receipts will be at least 60-billion below target this year, which will result in a considerably higher fiscal deficit than originally expected," Gordhan said in written reply to a parliamentary question.

    The Treasury has previously estimated revenue will come in between R50-billion and R60-billion short, warning that the 3,8% of GDP budget deficit -- itself a sharp widening from the 1,2 % of GDP shortfall for 2008/09 -- will not be met.

    Analysts predict the deficit will come in at about 7%, leading to a borrowing requirement of more than 10 % of GDP.
    full story from M&G here
    That's quite a blow-out. Looks like Trevor passed the hot potato at just the right time.

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