Climate Budget Tagging – Supporting the Implementation of South Africa’s Nationally Determined Contribution

World Bank/Government of South Africa (Partners: Mokoro)

Noting the increasingly evident negative and destructive impacts of climate change, a review of countries’ commitments to the Paris Agreement (coming up in 2021) makes the issue of reviewing and updating countries Nationally Determined Contributions (NDCs) pressing. In close partnership with the Government of South Africa, the World Bank is implementing a programme to support South Africa in implementing and updating its NDC. Tagging climate-related expenditures is understood to be a useful tool for understanding whether public expenditure is in alignment with climate-related policy objectives and whether there are any significant gaps in climate-related expenditure.

This project specifically aimed to support National Treasury in implementing a climate budget tagging (CBT) system in South Africa by i) evaluating options for a South African context-relevant CBT system; ii) developing a framework and methodology for CBT and piloting this at national, provincial and municipal government levels; iii) building the rationale, raising awareness and developing guidelines for its long-term implementation, and; iv) providing support and capacity building for the implementation of the CBT system.

The project team, through stakeholder engagement, developed guidance materials relating to the chosen design of the CBT system and piloted the design in selected spending ministries and local governments. Training workshops and on-the-job follow-up support will take place in parallel to piloting, ensuring learnings are grasped for successful continuation of CBT in the national fiscus.