Page 75 - Demo

Overview of the Provincial Revenue and Expenditure (OPRE %u2013 2025/26)3 BUDGET PROCESS AND THE MEDIUM%u2010TERM EXPENDITURE FRAMEWORK (MTEF) South Africa%u2019s transition to a democratic state in 1994 provided an opportunity for the new government to redress the discriminatory policies of the past with the ultimate objective of improving the coverage and the quality of public services that would benefit all South Africans. To achieve this, the budgeting system had to be overhauled which included the overhauling of the legislative framework for financial management as well as putting in place a functioning system of intergovernmental transfers. To meet the government%u2019s objectives, the budgeting system must provide a strong link between government policies and the allocation of resources through the budget. Because most of these policies cannot be implemented in the short term, the process of preparing the budget should ensure that resources are allocated over a medium-term. The budget is a tool through which the public sector delivers quality public services which is consistent with the needs of the citizens. The budget is a tool that government uses to implement its policies and priorities while simultaneously allowing for inclusive and accountable governance. Government%u2019s budget highlights the expenditure and revenues over the medium term and shows which priorities and policies the government intends to achieve with its spending and highlights how this spending is financed through a combination of taxes and borrowings. The budget itself is a result of the budgeting process which describes the way in which decisions about the use and funding of public resources are made %u2013 from the time the guidelines are issued and from the drafting of the budget into law until its subsequent implementation %u2013 budget execution. Figure 3.1: Provincial Budget Consultation Process Source: Provincial Treasury, 2024 54