Treasury reports R7.3bn underspent in Q3 budget

TheNational Treasuryhas revealed to parliament that departments underspent by R7.3bn in the third quarter, with total spending reaching R878.2bn. The presentation was made to the standing committee on appropriations, with underspending largely driven by lower expenditure on transfers and subsidies, as well as payments for financial assets. However, Ulrike Britton, deputy director-general of public finance at the Treasury, said spending on goods and services, compensation of employees, and capital assets were higher than expected.

Several departments exceeded their budgets, with the department of defence being the largest overspender at R4bn more than projected. According to Britton, this was mainly due to higher personnel costs and additional support forSouth African National Defence Forcedeployments in the eastern Democratic Republic of Congo. “The departments with the highest spending against projections, or with spending higher than planned, are social development, defence, police, agriculture, and water and sanitation.

In social development, higher-than-projected expenditure was due to increased payments for the Social Relief of Distress [SRD] grant,” she said. Social development spent R887.9m more than projected, driven by a rise in approved SRD grant applications, whilepolice overspent by R1bn. “In regard to police, higher spending on goods and services is mainly due to backdated lease payments to the department of public works and infrastructure for May to September 2025, which were processed late because of delayed invoice submissions.

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“Spending on capital assets was higher due to carryover costs from the previous quarter’s large acquisition of transport equipment. In addition, increased transfers and subsidies were driven by the payment of leave gratuities to employees exiting the police,” Britton said. In infrastructure, the department of water and sanitation exceeded its budget by R1.7bn due to transfers to municipalities for bulk infrastructure and water service grants, while the department of agriculture overspent by R405.2m.

Meanwhile, Britton said thedepartment of higher educationunderspent by R3.1bn, mainly due to delays in transferring earmarked grants, including the University Capacity Development Grant. The department of transport spent R3.3bn less than projected, with delays also affecting transfers to entities such as Sanral and the Road Traffic Infringement Agency. Britton said that beyond departmental spending direct charges against theNational Revenue Fundstood at R774.2bn, about R3.8bn more than projected.

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