Western Cape Government Welcomes Additional Funding Allocated to Provinces

The Western Cape Government (WCG) cautiously welcomes the tabling of the Budget by Minister of Finance, Enoch Godongwana and in particular the limited additional funding allocated to provinces for education and health services.

We acknowledge the difficult fiscal environment in which this budget has been drafted. However, provincial government budgets remain under intense pressure, and we note that provincial fiscal frameworks have not been further cut to protect critical services.

Premier Alan Winde said, “The 2025 budget process has been difficult and contentious, but we are relieved that key compromises have been made and that already over-burdened citizens will be spared from the punishing VAT hike proposed in the previous two budget frameworks. Our province and country need a budget that fast-tracks economic reforms, cuts wasteful expenditure, and reprioritises spending towards economic growth and job creation. We must urgently implement measures outlined in Operation Vulindlela such as improving the freight and logistics sector.”

“The Western Cape Government aims to table its new budget in the first week of June 2025. We also urge all municipalities in the province to table and adopt their budgets by the end of June, in line with legislative timelines, and to ensure that service delivery continues to reach our communities uninterrupted,” said the Western Cape Minister of Finance Deidré Baartman.

Premier Winde continued, “We remain concerned about the weakening fiscal environment. This is why we will continue to push for and implement economic policies that drive breakout economic growth. While we acknowledge these additional allocations for health and education will only come into effect in the adjustment budget later this year, the main budget provides provinces with a clearer understanding of how we will manage the significant fiscal challenges over the current financial year.”

Ongoing budget cuts—driven by a growing national fiscal crisis—have left us with far less funding than we need to maintain our recognised high standard of service delivery and to support our most vulnerable residents. At the same time, our rapidly growing population is placing greater pressure than ever on our frontline services.

The province’s population grew by nearly 20% between 2015 and 2024 – a 19.6% increase over this period. Over the next decade, the Western Cape is expected to grow by another 2 million people. We welcome those who are making the Western Cape their home and want to contribute to our success, but we must find ways to simultaneously build our services to meet their needs and the funding to support this.

While the Provincial Equitable Share increased in nominal terms in last year’s Adjustments Budget, the current formula does not adequately account for population growth and economic performance indicators. These indicators require heavier weightings to accurately reflect rapidly growing provinces like the Western Cape, Gauteng, and KwaZulu-Natal; and fail to sufficiently reward good governance and innovation.

“The majority of provincial budget funding comes from national government – thus, not increasing provincial envelopes in real terms has a direct impact on service delivery – such as health, education, and social development,” concluded Premier Winde.