There is no R1bn that was made “immediately” available to KwaZulu-Natal and the Eastern Cape to recover from the flood disaster last month, as apparently promised by finance minister Enoch Godongwana.
Instead, the two provinces were asked to reprioritise their budgets — using money that would be refunded when the National Treasury approved their applications to access disaster grants.
Godongwana's comments last month, which were later repeated by President Cyril Ramaphosa, created an impression that the Treasury would allocate additional funds to help the provinces recover from the damage caused by the floods.
The confusion was clear in remarks this week by the DA leader in KwaZulu-Natal, Francois Rogers, who told the media “the R1bn is no longer coming”.
But according to the Treasury, there never was a plan to send additional funds. The provinces were required to redirect money already in their budgets to relief and rebuilding. They would then be expected to apply to access disaster funds through the disaster management centre and the national department of human settlements.
In declaring a national state of disaster on April 18, Ramaphosa said: “We will make financial resources available to meet this challenge. The minister of finance has said that R1bn is immediately available.”
“The R1bn referred to by the president relates to funding that is catered for in the 2022 Division of Revenue Bill (and not new monies), namely disaster relief funds (for immediate response) through the provincial disaster response grant and the municipal disaster response grant,” the Treasury said in response to questions.
“These grants are allocated R144m and R371m respectively in 2022/2023. A further R501m is available in the provincial and municipal emergency housing grants for this financial year. These funds [amount] to just over R1bn.”
The Treasury said it was aware that KwaZulu-Natal wanted access to the funds, but the application had not reached it yet.
We knew that government money is not transferred in a briefcase from Pretoria
— KZN spokesman Lennox Mabaso
KwaZulu-Natal spokesman Lennox Mabaso told the Sunday Times the province knew it would have to scale back on certain projects to address the disaster.
It had to put on hold the purchase of new cars for political principals and the renovation of government buildings.
“We knew that government money is not transferred in a briefcase from Pretoria to KwaZulu-Natal, but we have a tried and tested system, ” he said.
The provincial government had made an application for funds on May 9. “However this was a formality as there had been an in-principle approval to spend in line with the situation on the ground.”
Human settlement minister Mmamoloko Kubayi said she had noted that there had been confusion about the R1bn. “People think there must be special appropriations because there is new money. We have just reprioritised the current budget,” she said.
“Because we are taking money of normal services delivery, that money will have to be replenished later to be able to still do the normal service delivery…
“I have heard eThekwini specifically talking about asking for money; we have asked them as well to reprioritise on your USDG [urban settlements development grant], which is a grant that we give them, because there is no new money, and I will sign off as the minister because we understand the importance of this reprioritisation,” Kubayi said.
"[But] eThekwini has refused to reprioritise. They are saying their funds are committed and unfortunately that is why we are then working with the reprioritisation of the province [funds] because it is money that is available that we can utilise, otherwise anything else that we do will be illegal.”
On Friday Ramaphosa told the Sunday Times that he understood the frustration about the application process but that the process was necessary to ensure that the government can account for the money.
“That’s the challenge that we have with our systems of ensuring that we manage our finances correctly. Money is going to be made available, as I said, because we cannot have a disaster like that and complain about not having money.
“We just need to take due care and diligence … so that the auditor-general, in the end, does not find a blemish with the way that it’s being done.”
Ramaphosa said “money will never be a problem” in dealing with the disaster.
In his address on April 18, the president also said the Treasury would provide money “as part of our efforts with the Solidarity Fund”.
This week the fund said it had a total of R45m as of Thursday in the form of donations and pledges from corporates, foundations and individuals.
“Government is currently working through its processes with regard to the quantum and timing of the funds to be allocated to the Solidarity Fund floods response,” it said.
It said about 85% of the money at its disposal would be allocated in KwaZulu-Natal and the rest in the Eastern Cape. About 200,000 people were expected to benefit from the money, which would begin flowing at the end of the month.
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