The estimated growth is expected to be about 1.55 trillion rand by 2017/2018.
According to the Medium Term Budget Policy Statement (MTBPS), the government’s expenditure priorities will be in improving the quality and delivery of health, education and social protection sectors.
Health expenditure is expected to surge by five per cent, while education and social protection will grow by 11 per cent respectively.
“Spending by function will grow most rapidly in post-school education and training, and employment, labour affairs and social security funds,” said MTBPS.
Expenditure in social services (education and skills development, health and social protection), is expected to account for about 42 per cent of allocated spending over the Medium Term Expenditure Framework (MTEF) period.
With increasing unemployment, the government will seek for alternatives to get youths to be intercepted in the job market on internships so as to help them acquire skills required to make them employable.
The allocations under the education cluster cover universities and colleges, sector education and training authorities, and the National Skills Fund.
Treasury added that moderate real growth in spending will enable government to finance most of the key priorities of the National Development Plan as expressed in the medium-term strategic framework (MTSF).
It also said long-term trends in public spending reflected the expansion of service delivery to poor households and the development of a social wage.
“The [trends] also show how fiscal space has closed as growth has weakened and debt costs have risen.”
According to the MTBPS, public spending had increased faster than inflation, with nominal annual spending growth averaging 11.7 per cent between 2005/06 (when the main budget was 421 billion rand) and 2014/15 (1.14 trillion rand).
The department added that expenditure growth had concentrated on social and economic infrastructure, as well as programmes that contribute to the social wage, such as education and health care.
It said, spending on these functions had risen from 51 per cent of the main budget in 2005/06 to 59 per cent in 2014/15.
“Much of this growth is accounted for by the doubling of the proportion of spending allocated to housing and municipal infrastructure and services, from about six per cent in 2005/06 to 12 per cent in 2014/15.”