Visit SA Government Coronavirus (COVID-19) website: https://sacoronavirus.co.za

COVID-19 Response

This page is intended to provide the public with credible, accessible information on the South African government's fiscal response to COVID-19.

It is curated by the Vulekamali project team and is intended to support open, informed engagement on important public finance matters in South Africa. The intention is also to outline the main funding mechanisms that will be used to finance South Africa’s COVID-19 response.The key agreements are envisaged with the private sector for an equitable sharing of resources (human, physical and services as well as capital and finance) are also important. The Solidarity Fund and other sources of income are explained below. In total, the National Treasury has announced a total package of R 500 billion to fight the pandemic.

Some of this information - including adjustments to existing budgets - will be tabled by the Minister of Finance at a date yet to be announced. The division of funding from the overall package will also be announced in the adjustments budget. These processes are provided for in the Constitution (eg Sections 16 and 24) as well as in the Public Finance Management Act (PFMA) and the Municipal Finance Management Act (MFMA).

COVID-19 Media announcements and publications
Tabling of COVID-19 Supplementary Budget

Time: 15:00-16:00 Wednesday, 24 June 2020

The Minister of Finance, Mr Tito Mboweni, will deliver a Supplementary Budget speech on Wednesday, 24 June 2020.

A Supplementary Budget has been necessitated by President Cyril Ramaphosa’s announcement that government would spend R500 billion to support the economy following the outbreak of the coronavirus.

The Budget delivery can be viewed on the links below:

Supplementary Budget resources

2020 Special Adjustment Budget guidelines

The guidelines to the special adjustment budget lay out how departments should prepare their submissions for the special adjustment budget, as well as key steps and dates in the process for preparing the special adjustments budget.

Economic response to COVID-19

Supplementary Budget tabled 24 June 2020

Initial economic response

See the full economic response document

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Provincial treasuries, working with the National Treasury, are identifying savings to fund the COVID-19 response.Provincial health departments are conducting testing, overseeing quarantine facilities and providing care and treatment for those who need to be hospitalised.

Health departments will receive additional funding as part of the R500 billion support package in addition to R466 million from disaster grants that was transferred to provinces in March 2020 to fund the purchase of personal protective equipment (PPE). Provinces are also adjusting their business plans for existing health conditional grants to prioritise facilities and equipment needed to respond to the pandemic.

Additional funding of R20 billion will be made available to municipalities to provide emergency water supply, to sanitise public transport facilities and to support vulnerable communities. The National Treasury is working with the Department of Cooperative Governance and other stakeholders to determine how to allocate and transfer these funds so that they reach the intended beneficiaries, while ensuring necessary oversight.

Funding sources for the fiscal response package

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Main allocations of the fiscal response package

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Phases of the fiscal response

Phase 1: Preserve

The focus of this phase is on immediate interventions to ensure health preparedness, as outlined by health authorities. Restrictions on economic activity will be gradually phased out to support businesses and workers. This is complemented with support to vulnerable households and firms to survive the impact of restrictions on economic activity. The proposed measures to support basic incomes and cash flow are temporary and easy to implement, leveraging existing mechanisms and requiring no complicated legislative changes.

Phase 2: Recover

As the restrictions on economic activity ease, the focus will shift toward supporting households and businesses to resume economic activity. This will require emphasis on measures to support employment and investment. The special adjustments budget will provide more details on these steps, and the withdrawal of temporary support measures. Far-reaching structural reforms will also be necessary, focused on measures that help to lower the cost of doing business and living.

Phase 3: Pivot

This phase aims to ensure that South Africa’s post-pandemic economy can rebuild and thrive. This requires rapid and sustained economic growth–both to reverse the steep decline associated with the coronavirus pandemic, and to break from a decade of weak growth. Long-term average economic growth expectations fell from nearly 4 per cent in 2008 to between just 1 and 1.5 per cent in 2019. South Africa’s structural problems are well understood and are identified in the National Development Plan. These include high levels of inequality, spatial disparities, the uneven quality of public services and inadequate state capacity. Although a wide range of policies aim to address theseproblems, progress has been limited.

Procurement

How will Emergency Procurement of PPE be done?

On 28 April 2020, the National Treasury announced new measures relating to Covid-19 Disaster Management Central Emergency Procurement Strategy; Instruction Note 5 of 2020/21 for Public Finance Management Act (PFMA) institutions and Circular 102 for Municipal Finance Management Act (MFMA) institutions.

This replaced previous instructions following concerns raised about the procurement process, that the approach adopted has excluded a number of domestic suppliers and that it covered too wide an array of goods, especially goods that can be manufactured locally. Given the rapid changes in demand for specialised products like testing kits and ventilators and further exacerbated by export bans, a national regulatory approach to procure goods centrally was required.

Both the changing demand and supply and the need for strict monitoring and reporting of procurement necessitated the introduction of the new Instruction Note.

During the pandemic, Institutions may approach any supplier to obtain quotes and may procure from such a supplier on condition that:

  • The supplier is registered on the Central Supplier database (CSD)
  • The items meet the specifications as determined by the Department of Trade, Industry and Competition (DTIC), National Department of Health and World Health Organisation
  • The price is equal to or lower than the price in Annexure A
  • For cloth masks, only suppliers registered with the Department of Small Business Development and are registered on the CSD will be considered.

Tenders and other procurement methods:

See also:

Oversight

In-year monitoring

National government

You can find in-year summary information about the National Revenue Fund and national departments in the National Section 32 (in-year) publications including

  • Monthly statements of the National Revenue, Expenditure and Borrowing
  • Monthly summary of cash flow
  • Additional Information on National Revenue Fund receipts/payments

Provincial government

You can find in-year summary information on provincial revenue, expenditure, and sectoral reports in the Provincial Section 32 (in-year) publications including

  • Quarterly budgets and expenditure report
  • Quarterly statement of receipts and payments