Provincial Own Revenue

The revenue target of the Free State Province has been achieved for the past years by collecting more than the initial budget projections. The 2008/09 target was, however, in line with collection. The Free State revenue budget has indicated a growth for the past years and there was also a growth in terms of the collection.

OVERVIEW – 2010/11

ACHIEVEMENTS

  • The Free State Province was the fourth (4th) highest own revenue collector and this despite having the second (2nd) lowest GDP, population and receiving the second (2nd) lowest expenditure allocation.
  • The Provincial Revenue Budget (2010/11) was adjusted upwards with 4.6 % from R647 million to R677 million.
  • An actual collection of R806 million was achieved compared to target of R677 million (Provincial Adjusted Revenue budget), representing a 19 % over-collection. This was as a result of the collective effort of provincial departments and interventions made by the Provincial Treasury during the year.

OVERVIEW FOR 2011/12

ENHANCE THE PROVINCIAL REVENUE GROWTH

  • The Provincial Revenue Enhancement Strategy was introduced in September 2011 which constitutes a tool through which all Government Departments and Entities in the Free State will implement measures by which revenue collection, administration and processes will be improved.
  • Through the Strategy and continued efforts, the Provincial Treasury together with Provincial Departments will systematically provide best practices on own revenue, while promoting efficiency and effectiveness for the utilization of current revenue sources.
  • The Strategy will enhance revenue collection, strengthen existing control processes and create innovative ways for new revenue streams, it also seeks to protect funding that is meant for revenue related projects, systems and key areas that need funding to increase revenue –

Revenue Enhancement Allocation

  • A new allocation, the Revenue Enhancement Allocation, is part of the Provincial Revenue Enhancement Strategy.
  • The Revenue Enhancement Allocation will be 5% of the revenue budget, which will be used in supporting and strengthening revenue collection of the Departments. This will directly benefit revenue enhancement of the Province.

INTERNAL FOCUS 2011/12

  • The Revenue budget for 2011/12 was increased by 7.5 % from R717.613 million to R771.470 million during the revenue bi-laterals in September 2011.
  • Provincial Treasury will continue to strengthen the collection and administration of the existing own revenue sources.
  • Treasury will also facilitate Revenue Workshops whereby all the best revenue principles/practices are outlined and the opportunity is therefore given to Departments to strengthen existing control processes.

The following interventions were implemented by Fiscal Policy:

  • In order to improve the availability of cash for investments and expenditure, weekly payments to Provincial Revenue Fund of revenue collected by provincial departments were implemented as opposed to the monthly arrangement. This greatly promoted and improved revenue generation.

Challenges:

  • The high volume of outstanding debts such as motor vehicle fees and patient fees, remain a concern