The National Treasury has allocated R1.76bn in additional allocations to provinces for the 2025/26 fiscal year to fund the early retirement and voluntary exit programmes.
The increases were announced in the Government Gazette.
Finance minister Enoch Godongwana introduced an R11bn early retirement plan in the 2024/25 budget to reduce the public sector wage bill and rejuvenate staff.
Targeting 30,000 employees aged 55-59, it allows for retirement without reduced benefits. The initiative aims to save R2bn though unions warn of skills losses especially in the health and education sectors.
The programme for eligible employees was also introduced by the Treasury in October 2025 to rejuvenate the public service, manage the public service wage bill and enable the restructuring of departments to improve service delivery.
The additional allocations to provinces are as follows: the Eastern Cape R367m, the Free State R217.4m, Gauteng R359.6m, KwaZulu-Natal R143.4m, Limpopo R200m, Mpumalanga R84m, the Northern Cape R97m, the North West R38m and the Western Cape R251m.
The Treasury said in the Budget Review tabled in parliament last month that in the first phase 7,687 applications from eligible employees were approved, of which 4,644 related to provincial departments and the rest to national departments.
The total cost of the early retirements, the review says, amounts to R3.7bn and an estimated R5.5bn net savings, of which R2.9bn will be realised in 2026/27, R1.4bn in 2027/28 and R1.5bn in 2028/29.
In 2025/26 provinces were allocated R789bn as their equitable share (R649bn) of nationally raised revenue and in the form of conditional grants (R139bn) with a total allocation of R810.5bn projected for 2026/27.
In a separate gazette, the Treasury allocated additional funds for the 2025/26 year to four provinces under the Provincial Disaster Response Grant after severe weather and flooding damage. KwaZulu-Natal was allocated R22m, Limpopo R53.3m, Mpumalanga R49m and the North West R27m.