The staggering cost of South Africa’s provincial government salaries
Nearly R1 billion was spent on salaries for provincial government employees in 2023-2024, with a coastal province spending the highest.
Provincial employee compensation across South Africa reached a staggering R450 501 million during the 2023-2024 fiscal year, according to newly released financial statistics from Statistics South Africa (Stats SA).
This massive figure accounts for the largest proportion of expenses for operating activities, making it an essential investment for public services nationwide. This outlay represents salaries paid to staff across all nine provinces, including critical personnel such as educators and healthcare workers.
The total expenses for operating activities increased by R32 633 million from the previous year, mainly driven by rises in purchases of goods and services and, significantly, compensation of employees. The increase in provincial compensation of employees alone amounted to R21 675 million between the 2022-2023 and 2023-2024 fiscal years.
This trend reflects the growing need for provinces to bolster their human resources to deliver fundamental services, especially education and health, which are the largest functional expenditure categories overall.
Why are provincial government salaries rising?
The province that spent the highest amount on provincial salaries in the 2023-2024 financial year was KwaZulu-Natal (KZN), which accounted for R95 189 million of the total compensation of employees. KZN was one of the provincial governments reporting increases in compensation of employees during this period. This immense expenditure underscores the sheer scale of public service delivery required to serve the region.
Hot on KZN’s heels was Gauteng, which reported compensation of employees amounting to R92 528 million. The Eastern Cape followed with a bill of R59 774 million for employee compensation. Gauteng was also noted for having the largest growth rate in compensation of employees, increasing by 6.9% between 2022-2023 and 2023-2024.
Several other provinces also demonstrated substantial spending on employee salaries, reflecting necessary investment in staffing. Limpopo, despite reporting one of the smallest growth rates in employee compensation at 3.1%, still registered a substantial expense of R52 080 million for the fiscal year.
The Western Cape spent R43 801 million, and notably saw a strong growth rate of 6.1% in salary spending. Mpumalanga recorded salary spending of R35 621 million, and North West accounted for R32 102 million. This sustained investment in personnel ensures that crucial functional services, particularly education and health, remain primary areas of provincial expenditure.
Where are the salaries of employees the smallest?
Providing context to the larger spenders, the Stats SA data reveals that the Northern Cape had the smallest provincial government employee compensation, amounting to R12 114 million.
This figure is significantly lower than the R95 189 million spent by the province leading the charge.