How are provincial governments using your tax money? Stats SA’s latest Financial Statistics of Provincial Government report describes the spending patterns of provincial government.

Where do provinces get their money from?

Mostly, from our tax contributions. Financial statements from 124 provincial government departments show that provincial governments sourced R429,9 billion in revenue in 2013/14. R415,7 billion (or 97%) of revenue was in the form of grants from the national government, money that was most likely sourced from taxes collected at national level.

The remaining revenue was generated by provinces themselves: R9,3 billion (or 2%) was in the form of provincial taxes, from motor vehicles licences to gambling licences, R4,8 billion (or 1%) was from other sources.

The KwaZulu-Natal provincial government received the lion’s share of grants (R88,5 billion or 21% of the national total), followed by Gauteng (R77,2 billion or 19%) and Eastern Cape (R59,8 billion or 14%). Northern Cape received the least (R12,6 billion or 3%).

What do provinces spend money on?

Provincial governments spent a total of R425 billion in 2013/14, focussing on education (R181,1 billion or 43% of the total) and healthcare (R127,1 billion or 30%). Economic affairs ranked third, (R46,3 billion or 11%) on expenditure, with money flowing mainly into transport-related activities (e.g. road refurbishment).

Provinces prioritised their spending in different ways. From a functionally classified perspective, the Limpopo provincial government spent just over half of its budget on education, the highest proportion of any of the provinces. Western Cape concentrated equally on both healthcare and education.

The bulk of provincial education expenditure is on pre-primary, primary and secondary education. Free State spent the most per person (aged 5 to 19) on education in 2013/14, namely R13 830. Western Cape spent the least, namely R10 084.²

In terms of healthcare, which affects persons of all ages, Northern Cape again tops the list, having spent R2 876 per person in that province in 2013/14. Mpumalanga spent the least, at R1 876 per person.

Stats SA publishes detailed reports on the financial status of all spheres of government, including national government, provincial government, local government, extra-budgetary accounts and higher education institutions. A consolidated report, containing financial data for all spheres for the 2013/14 fiscal year, is scheduled to be published on 24 November 2015.

¹ Download the complete publication here.

² Population figures were sourced from Stats SA’s Mid-year population estimates 2013.