Provinces that have already suffered from the fiscal consolidation imposed by Treasury over the last few years will be negatively affected by the low projected growth rate in their budget allocations over the next three years, the Financial and Fiscal Commission (FFC) says.

The medium-term budget policy statement (MTBPS) tabled in parliament by finance minister Enoch Godongwana last week acknowledged that “provincial and municipal governments face pressures from rising costs of basic and social services over the medium term as government contains spending growth and weak economic growth affects other sources of funding. While cost pressures are growing, municipalities are in worsening financial distress.”..

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