Statistics SA & National Treasury Budget votes: draft committee reports

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Finance Standing Committee

25 June 2009
Chairperson: Mr T Mufamadi (ANC) & Ms E Coleman (ANC)
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Meeting Summary

Members of the two Committees, sitting jointly, considered the draft Committee Reports on Budget Votes 11 (Statistics SA) and 7 (National Treasury). A Member asked that for the moment the recommendation adopt the Votes be removed from the Report, until Members were happy with the final version. One Member suggested that the Report should include a recommendation that National Treasury should monitor the impact of the recession on tax revenue collection and make recommendations, and other Members expanded upon this to suggest that the report specifically include a paragraph on recession, that South African Revenue Service should table a programme on how it was intending to counter the revenue loss, and that National Treasury and Department of Economic Affairs should report clearly to the Department what their roles were, to avoid duplication. It was noted that although Government had drafted a response plan, Members still wished to hear specific briefings on these points. It was further suggested that a briefing was needed about the proposed amendments to the Public Finance Management Act, that National Treasury should have a bias to supporting schemes that would empower people, and that statistics and further information were needed on transfers to the provinces, to explain the over spending. In relation to the portion dealing with Statistics SA, Members proposed that there be a recommendation that the communications strategy of Statistics SA be reviewed, that it should improve its accounting system and utilize other resources, including investigating partnerships with other departments, and that it should provide a detailed description of how Census 2011 would be implemented. The reporting line from Statistics SA to the Minister in the Presidency, and the relationship between that Minister and Parliament, would also need to be dealt with. Amendments would be made to the draft report and the Committee Members would again have sight of the amended version before taking their final decision.

Meeting report

Committee reports on budget votes: deliberations
The Chairperson noted that the draft Committee reports on budget votes 11 (Statistics SA) and Vote 7 (National Treasury) had been tabled, and asked Members to comment. He was aware that Members had not had much time to study them, but the drafts should form the basis of discussions and input today so the reports could be finalised.

Dr D George (DA), referred to the first page’s recommendation that Budget Vote 7 be passed. He thought that this sentence should, for the time being, be removed from the report as the Committee had not yet reached that stage.

Mr George said he would like to have an additional point made. The economy was currently in recession, which would have a large impact upon tax revenue collection. He would therefore like to suggest that National Treasury (NT) should monitor the impact of the recession on tax revenue collection and make recommendations.

Mr M Swart (DA) said that he would like to see a recommendation that the Committee must receive a report either from National Treasury alone, or from NT and Department of Economic Development together, giving clarity on the roles of the two departments, to avoid duplication in their work. 

Dr P Rabie (DA), made the suggestion that the report specifically include a paragraph on recession. He said that the Minister of Finance had commented, during a previous meeting, that the current recession was the worst in 70 years. The Minister was talking about value for money, and said that there would not be “business as usual”. The Minister also added that many other aspects were going to be tough, and it was important to address these points in the report.

Ms N Sibhidla (ANC) recommended that South African Revenue Service (SARS) should table before the Committee a detailed programme on how it was intending to counter the revenue loss. SARS had said that it had currently lost about R10 billion and might, by the end of the year, lose R80 billion.

Co-Chairperson Ms E Coleman (ANC) said that she was not sure about the Committee Report discussing the recession, because the Minister had said in his presentation that the money was available, but the serious problem was how it was being managed. She said that SARS was also aware that its collection figures were about R10 billion less than it was expecting. She wanted to know what programmes were going to be in place, to decide whether or not such programmes were likely to be effective in managing the recession.

Co-Chairperson Mr Mufamadi summarised that Dr George had made the point that it was premature for the report to state that the budget was supported, as the Committee needed a reason to support that conclusion. Other Members felt that more needed to be added to the recommendations and expectations of the Committee. He agreed that the points on revenue and contraction of the economy should be included.

A Member suggested that a full report should be given on the plans to get South Africa out of the recession.

Ms L Zulu (ANC) said that the discussion needed also to consider the other documents tabled by the Government, including Government’s response plan.

Ms Sibhidla responded that there was certainly a plan available. However, she would still like to have the Departments address the Committee specifically so that there could be engagement around the issues.

Mr E Mthethwa (ANC) said that the information given in the report was correct but it was in a truncated form. The Minister had given the broader perspective of the international condition, and some of those areas were not captured in the report. He said that those areas alone would assist Members in concluding their debate. In addition, their attention would be drawn to international precedents as well as the current situation. He suggested that there was a need to include more detail, especially for the new Members of the Committee.

Dr Rabie (DA) said that the Minister had made the point that the Public Finance Management Act (PFMA) permitted the National Treasury to dictate macroeconomic policy. He suggested that it would be incorrect to state that specific departments had acted in an incorrect way, unless National Treasury was also involved in the discussions.

The Chairperson said that in reality NT’s responsibility was not just to stand back and hand out funds, but rather to enable a budget for the entire government. The Committee Members could not speak for the Executive.

The Chairperson agreed with Ms Sibhidla that there was a lack of information and further information was needed from the Departments as to how they would move forward.

Co-Chairperson Ms Coleman noted that National Treasury spoke about the amendment to the PFMA and suggested the need for a briefing on which aspects were to be reviewed.

Mr X Mabaso (ANC) said that the Committee should recommend to National Treasury that, in distributing funds, it should take into account the difficult times faced by South Africans, especially the poor. He suggested that NT should have a bias towards empowering schemes that sought to improve economic life of the poor.

Mr S Ngonyama (COPE) referred to the issue of the transfers, especially to provincial and local government, and noted that three provinces had overspent by approximately 5%. He asked whether it would be possible for Members to get overall statistics on all the transfers in all provinces.

The Chairperson commented on the conclusion part of the report. He believed that the reference to the Parliamentary programme and the note that many Members were new should be removed.
Secondly, he commented that Members should be commenting on Programme 2 (Public finance and budget management), noting that it should cover how to manage under difficult constraints, and include comment on assets and liability management.

The Chairperson asked Members if they were prepared to adopt the Budget Vote.

Dr George reiterated that he did not have a mandate as yet.

Dr George then turned to the draft Report on the budget vote of Statistics SA (Stats SA). He noted that one of the recommendations on communications, which noted that many results would either be misinterpreted or they were not packaged correctly. He then proposed that the report should contain a recommendation that Statistics SA must review its communications strategy, with regard to publicising results from statistics correctly.

Ms Z Dlamini- Dubazana (ANC) added that perhaps there should be a recommendation to form an effective accounting system and to utilise other resources available, such as bringing in students or seeing whether partnerships could be created with other departments, such as Department of Education.

Ms Sibhidla added that she would like Stats SA to provide the Committee with a detailed programme on how it was going to implement Census 2011. During the previous engagements questions were asked which indicated that there was no final strategy for this, although there were reports of a pilot project. A detailed programme would, she felt, minimise under accounting.  There should also be mention of the fact that Stats SA was establishing a statistics institution in to train its own statisticians. Furthermore, she suggested that Stats SA must share information on their plan to decrease its vacancy rate, as it was unacceptable.

Dr George enquired how Stats SA, if it was to be reporting to Minister Trevor Manuel, would be accountable to Parliament, as it would presumably not come before a Committee.

Mr Mabaso said that Stats SA had a programme, together with the South African Post Office (SAPO) to give addresses to households all over the country. He said that this related to the point which Ms Dubazana made earlier about the need to get a progress report, especially in relation to rural areas where the post offices might have more information whilst Stats SA had less.

Ms Sibhidla commented that in the engagement with Stats SA  there was no clarity as to how it engaged with other departments in relation to the information collected; sometimes it might subsequently collect information that could have assisted a department in its planning. She felt that one of the recommendations should be a discussion as to how Stats SA and general departmental planning were aligned.

The Chairperson said that Dr George’s point about the line of reporting about Stats SA should be included in the Report. It had reported to different offices since 1994, including National Treasury, the RDP office and the Presidency. Until now the transition and budget was not formally gazetted.

The Chairperson also said that the relationship between Parliament and the Minister in the Presidency would be unique, and he thought that both the Speaker and the Leader of Governance and Business in Parliament should be looking into that issue.

The Chairperson noted that the amendments would be made to the draft reports and the Committee Members would have sight of the amended versions before taking the final decision.

The meeting was adjourned. 


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