​Over the past week, reports circulating in the media have communicated to the resident of the Gauteng Province that the provincial government has underspent by R1.8 billion, and that these underspent funds would be returned to the National Treasury. While there is legitimacy in the information on the underspent figure, there is fundamental misunderstanding and misinterpretation in so far as the process that follows this underspending. The concern that the underspent resources will no longer be available, or that they are lost by the Gauteng Provincial Government, is a misunderstanding that necessitates clarification.

The starting point for understanding the expenditure that we will be presenting today is to understand what the Provincial Revenue Fund is. A Provincial Revenue Fund (PRF) is a financial account for each province in South Africa, where all revenue received by the provincial government is deposited, with some exceptions. The Fund covers revenue from various sources, including taxes, fees, and transfers from the National Revenue Fund. The Provincial Revenue Fund is managed by the provincial treasury, in this context, the Gauteng Provincial Treasury. The provincial treasury ensures compliance with regulations. To this end, money can only be withdrawn from the Fund through specific appropriations or as direct charges, as outlined in the Constitution and provincial legislation.