The effect of the global economic slowdown has been felt by fiscal finances this year. An expansionary fiscal policy framework was adopted to counter the recession in South Africa. Over the past year, there have been various infrastructure development projects with an eye on the 2010 Soccer World cup and beyond. There were also significant increases in the unplanned funding to state owned institutions (ESKOM, DENEL, SAA) and social grants expenditure. The extra expenditure on state owned entities also placed continues pressure on state finances. Uncertainty about future expenditure patterns makes it very difficult to estimate the government expenditure for 2010/2011 accurately. It is however very worrying that fiscal expenditure increased substantially during 2009/2010 whilst fiscal revenue is much lower than expected. Read on….