Remember the R500 billion relief package that was instituted back in April to cushion the effects of the unprecedented pandemic? Well since its establishment and disbursement, there has been a fair amount of speculation as to where the money went and whether it was lost to corruption.
Finance Minister Tito Mboweni, while delivering the Medium-Term Budget Speech on Wednesday 28 October 2020, sought to clear the confusion by outlining exactly how the R500 billion relief package was spent. He also added that it was not entirely lost to corruption as some may suspect.
R500 BILLION RELIEF PACKAGE: HOW WAS IT SPENT?
According to Mboweni, the R500 billion relief package was spent as follows;
- More than R30 billion for health and other frontline services;
- Support for vulnerable households which is now in excess of R50 billion;
- More than R40 billion for wage protection through the UIF;
- Around R100 billion for job creation initiatives, which will now be spread over the MTEF;
- R200 billion for a credit guarantee scheme;
- R20 billion towards municipalities to assist them with COVID-19 related activities; and
- R70 billion towards emergency tax measures.
“It’s not true that the R500 billion relief package has been entirely lost to corruption. As pointed out above, it is being used to cushion the impact of the pandemic and aspects will continue to be rolled out over the medium term particularly the Presidential Employment Programmes,” said Mboweni.
Mboweni said efforts to support a rapid response to COVID-19 underline the need for comprehensive procurement reforms.
“The national treasury has withdrawn the emergency procurement instruction note and required all state bodies to revert to normal procurement processes. Procurement is now slowed down due to a few scoundrels who put themselves ahead of the country, and we must all suffer,” said Mboweni.
As we now know, the details of all COVID-19 related procurement, including the names of companies awarded contracts have been published. Mboweni said the majority of health spending takes place at provincial level and provinces are taking actions against those found to have been involved in corrupt practices.
The South African Revenue Services is also working with other law enforcement agencies to evaluate R3.5 billion worth of tenders awarded to entities not registered for VAT.
“In addition, the State Capture Commission of Inquiry is allocated an additional R63 million from the Department of Justice and Constitutional Development to finalise investigations and produce a close-out report,” he added.
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