Appropriation Bill: Parliamentary Researcher's report & 2nd draft of Committee report

Standing Committee on Appropriations

18 May 2010
Chairperson: Mr E Sogoni (ANC)
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Meeting Summary

The Committee Researcher had prepared a report on the Appropriations Bill, to assist the Committee in the preparation of its final Committee Report. The Committee Report was based on hearings held with the Financial and Fiscal Commission (FFC); the Public Service Commission (PSC); the Human Sciences Research Council (HSRC), and Mr Neil Galvin and Mr Malose Kekana in their private capacities. The Report set out the legislative framework pertaining to the hearings, and provided a performance and aggregate expenditure review, across various departments. It covered budget allocation; job creation and infrastructure; education and skills development; improvement of health care systems; rural development and livelihoods, and the fight against crime and corruption. It concluded with a list of findings and recommendations.

At the commencement of the reading through of the report, a DA member objected strenuously that Members were being expected to review and correct the grammar, since other Committees attended to the content and the grammar and other errors were generally corrected by the Parliamentary staff and Chairperson. The Chairperson took the point, but said that he would still like Members, while concentrating on content, to ensure that the formulation of the wording really reflected the views of the Committee. Members held differing views on the formulation of references to matric pass rates in poor schools being very low. A DA Member maintained that this was only one factor and that a poor black school in George had managed to significantly increase its matric pass rate by instilling better discipline. It was decided that the general pattern that was relevant to the majority of cases, which was further compounded by unqualified teachers at these schools, should be reflected. Members discussed whether “unqualified” or “under-qualified” teachers was a more correct term.

Members submitted that the Report should be placed in context. The most important finding was that the Committee was not recommending any amendments to the Appropriations Bill. The Report had to be placed within the context of the incremental implementation of the Money Bills Amendment Procedure and Related Matters Act, but should also recommend the fast-tracking of implementation of this Act. The Committee Report should also recommend that a detailed project plan for the implementation of the provisions of Act 9 of 2009 should be tabled in the House, within 30 days, by the Office of the Speaker.

Members were in agreement on the format of the report. A COPE Member suggested that the need for action had to be expressed in persuasive terms. Members agreed that the fact that some departments had not complied with procedures in programmes must be mentioned, that these departments be named and that the Committee wanted these departments to submit turnaround plans within 90 days.

There was general agreement among members that the Report, while primarily reflecting that Parliament adopt the Appropriations Bill, should also draw attention of Cabinet Ministers (who should then convey these to the Department) to issues that required urgent attention.

Meeting report

Analysis of the Appropriation Bill 2010: Committee Researcher’s report
Mr Pelelane Dlomo, Parliamentary Researcher, noted that he had prepared a report for the Committee, giving an analysis of the Appropriation Bill of 2010, to assist the Committee in producing the Committee’s final Report. He read through the document with the Members. This document referred to the public hearings on the Appropriation Bill held with the Fiscal and Financial Commission (FFC), the Public Service Commission (PSC), the Human Sciences Research Council (HSRC), and Mr Malose Kekana and Mr Neil Galvin, who had presented submissions in their private capacities.

Mr Dlomo’s report set out a perspective on the legislative framework that required the Appropriations Committee to hold public hearings on the Appropriation Bill and any proposed amendments. He reminded Members that comments and amendments to the Bill had to be reported to Parliament.

This report provided a performance and aggregate expenditure review, across the Departments of Social Development, Cooperative Governance and Traditional Affairs, Justice and Constitutional Development, and Defence and Military Veterans. It also considered the budget allocation, job creation and infrastructure, education and skills development, the improvement of health care systems, rural development and livelihoods, and the fight against crime and corruption. It concluded with a list of findings and recommendations.

Discussion
The Chairperson noted that the final Committee Report on the Appropriations Bill (the Report) would have to be adopted by the forthcoming Friday.

The Chairperson commented that there were some language inconsistencies in the report. He suggested that the Committee Researcher read through the report, and that Committee Members comment on it, page by page.

Mr M Swart (DA) objected that the Committee had gone through the same process the previous year, and it had at that time taken a whole hour to get through a page. He suggested that this Committee should perhaps consider adopting the procedure used in other committees, where Members would consider the findings and recommendations, and the Chairperson and researcher, or other Committee staff, would then refine the report. He said that it was not his own job to check grammar and wording.

The Chairperson replied that the Committee was under pressure. He agreed that the Members should perhaps focus more on the content, not the construction. He said that much was demanded from staff already, and their efforts were appreciated.

Mr Dlomo apologised for any grammatical errors, and agreed that the focus could be on content.

Mr L Ramatlakane (COPE) asked what “current information” in the middle of page 2 referred to.

Mr Dlomo replied that it referred to data placed on the website by National Treasury.

The Chairperson remarked that this was a public document, and that information had to be spelled out for people.

Ms B Ngcobo (ANC) asked if it was social security or social services that were referred to on page 2.

Mr Dlomo replied that the Appropriations Bill referred to Social Security Programmes.

Mr Ramatlakane suggested that the sentence be refined, but that members concentrate on the thrust of the report. The grammar could be corrected afterwards.

The Chairperson countered that there was a danger that in making too many corrections, the Committee could lose the sense of what it wanted to say.

Mr Ramatlakane ventured that Committee’s recommendations were most important. Members had to consider the gist of what was said.

Mr D Mavundla (ANC) suggested that the format be taken as set.

The Chairperson expressed concern about a sentence in the second paragraph on page 3that currently read: “PFMA gives provision on virements and shifting of funds, but the manner in which these movements are done remains a cause for concern”. He said that this could be difficult for the public to understand.

Mr Ramatlakane suggested that the sentence start with: “Notwithstanding that the PFMA…”

The Chairperson suggested that “in some cases” be inserted in the sentence on page 3, which stated that the Department of Justice and Constitutional Development had taken 252 days to deal with the suspension process.

Mr Ramatlakane noted that the last paragraph on page 3 referred to Mr Neil Galvin’s “belief”. He asked whether this was correct, and whether this was “fact” or “a belief”.

The Chairperson suggested that the Committee should return to this matter.

Mr Ramatlakane noted that page 4 referred to stakeholders invited by the Committee. He suggested that the Report should list who had been invited and who actually came to brief the Committee.

Mr G Snell (ANC) said that the Financial and Fiscal Commission (FFC), the Public Services Commission (PSC), and the Human Sciences Research Council (HSRC) had been invited, and the hearings had been advertised in newspapers. Mr Neil Galvin and Malose Kekana had elected to appear to give their response in their private capacities, but were the only two people in the country who were willing to respond.

Mr Snell remarked that matters had to be placed in context. The recommendations made by individuals could be listed in the report, and the Committee findings and recommendations should also be included. Mr Snell advised that the Committee Report should, upfront, recommend that the Appropriation Bill be passed without amendment. Thereafter, its recommendations could be used to support this and to strengthen the report.

The Chairperson asked if Mr Snell thought that it should be done immediately, or at a later stage.

Mr Snell responded that the findings were not relevant for passing the Bill, but could usefully be included in the report. The issues raised, and findings and recommendations, could form part of the report. For the moment, the main relevant finding was that the Committee did not wish to amend the Appropriation Bill.

The Chairperson agreed with that. The work of the Committee was defined in terms of the legislation. He asked Mr Snell to put his suggestion into writing.

Mr Ramatlakane commented that Mr Snell was essentially talking to the structure of the report. The introduction to the Report set out the legislative framework and the process related to the hearings. He agreed about the recommendation by the Committee that the Appropriation Bill not be amended.

The Chairperson referred to the sentence in the last paragraph on page 4, that job creation was a priority and constituted 5.97% of the main budget. He asked what was meant by “priority”, and whether it referred to the Expanded Public Works Programme (EPWP).

Mr Dlomo replied that it referred to the five government priorities identified in terms of the total budget. It did not merely refer to EPWP, but to all sectors. This sentence would be rephrased.

The Chairperson referred to a sentence on page 4, in the last paragraph, that government had prioritised job creation, but that other sectors had to take part. He asked Dr Rabie, as an economist, to comment on this.

Dr P Rabie (DA), said that the primary role of government was to provide a safe environment, but it could also create jobs.

The Chairperson agreed that it was not the prime responsibility of government to create jobs, but to keep a balance. Decent jobs were not only those from government. Government had to create the environment in which job creation was possible.

Mr Dlomo said that the role of all sectors had been acknowledged in the report.

Mr Ramatlakane thought the sentence about job creation was satisfactory as it stood.

Dr Rabie added that government had to co-ordinate the work environment. It did not have the capacity to employ or source revenue from the private sector. The government needed the private sector.

The Chairperson asked if that was a Marxist view.

Dr Rabie responded that it was based on general economic theory.

Mr Dlomo suggested that a sentence be inserted to the effect that government had to create a conducive environment.

Ms M Mkhulusi (ANC) referred to paragraph 1 on page 5, which stated that teachers were teaching without qualifications. She said that it was necessary to distinguish between “unqualified” and “under-qualified”. An under-qualified teacher was one who had only completed two years, for instance, of a three-year course. The qualification was not relevant.

Mr Ramatlakane felt that “unqualified “ was too harsh a term, and that perhaps “inappropriate qualifications” was a better term.

The Chairperson queried the figure of 500 000 jobs created by the EPWP, as mentioned in paragraph 3 on page 5.

Mr Dlomo said that the figure may be 550 000.

Mr Swart referred to paragraph 1 on page 6, which noted that the matric pass rate for poor schools was still very low. He questioned this statement, saying that poverty was not the only factor involved. He referred to a poor black school in George that had managed to gain an increase in matric pass rates, from 52% to 80%, because discipline and punctuality had been improved. He suggested that a sentence should be inserted that some poor schools were doing well.

Mr Ramatlakane said that whilst he took the point that some had improved, the fact remained that the majority of schools were indeed poor.

Mr Swart persisted that other factors that led to poor performance needed to be highlighted and attended to.

Mr Mavundla noted that the factors alluded to by Mr Swart, were included in paragraph 2 on that page.

The Chairperson commented that the sentence implied that research had pointed out a general pattern. It had shown the impact of a lack of resources. Unqualified teachers went to poor schools. The sentence stated a general trend.

Ms Ngcobo drew attention to the challenges in education that were highlighted by the HSRC, in paragraph 3 of page 6.

Mr Swart maintained that it was not just a matter of resources. Other factors impacted. He suggested that it be stated that poor pass rates were due to various factors.

Ms R Mashigo (ANC) remarked that the HSRC had said that much was spent on education, but that results were not forthcoming.

Mr Ramatlakane said that the sentence as it stood was already indicating 80% of the problem. There were other factors, but matric failure results from poor schools remained a fact.

The Chairperson told Mr Swart that the sentence reflected the majority trend.

Mr Snell noted that different schools fell into different brackets, according to economic factors.

Mr Dlomo suggested that reference be made to the quintile system.

Mr Swart said that there had been no reference to the suggestion that technical schools be re-opened, in one of the hearings.

Mr Dlomo noted that technical schools formed part of Further Education and Training Colleges, as opposed to vocational schools. The reference to skills development centres with an open entry system, in the last paragraph on page 6, also applied.

The Chairperson suggested that the phrase “universities with a majority of poor African students”, in the last paragraph on page 6, be changed to “previously disadvantaged universities”.

The Chairperson referred to the sentence, in paragraph 2 on page 7, which read:  “the Committee views the ten-point plan as an integral plan in preparing for the implementation of the National Health Insurance (NHI)”. The Committee had had no input from the Department of Health. It would be better to say that the Committee welcomed it.

The Chairperson suggested that the Committee now return to discuss Mr Snell’s proposal on the findings.

Mr Snell read out some handwritten notes, which he had had copied for Members in the meantime. These suggested that the introduction to the Report should specify that the Money Bills Amendment Procedure and Related Matters Act No 9 of 2009 set out the legislative framework for the amendment of the Appropriations Bills by the House, facilitated through processes of Parliament, and the Appropriations Committee in particular. The conclusion to the Report would be that Act 9 of 2009 was being implemented incrementally by Parliament. Prescriptions introduced incrementally included amendments to the Standing Rules and the establishment of a Parliamentary Budget Office. The Committee Report was tabled within the context of an incremental approach to the implementation of Act 9 of 2009.

Mr Snell proposed that the Findings section of the Report should note that the Committee had not recommended any changes to the Appropriation Bill. The implementation of Act 9 of 2009 had to be fast-tracked to give effect to its provisions.

Mr Snell proposed that the Recommendations section of the Report should state that the House considered the adoption of the Appropriations Bill, without amendments. A detailed project plan for the implementation of the provisions of Act 9 of 2009 should be tabled in the House, within 30 days, by the Office of the Speaker.

Mr Snell suggested that this reference be inserted before the Introduction in the Report.

The Chairperson advised that some part of the statement should be kept back for the Conclusion section of the Report.

Mr Snell agreed that the Introduction and Conclusion could be separated from Findings and Recommendations.

Mr Swart, Mr Ramatlakane and the Chairperson concurred that both the Findings and Recommendations sections had to be embodied in the report.

Mr Snell opined that the title of the Report could refer to findings and recommendations, or Committee’s views and concerns around the Appropriations Bill.

The Chairperson noted that some findings did not flow from the report. He wondered if the term “trends” could be more appropriate than “views”.

Mr Snell suggested that the phrase should read: “Trends noted by Committee throughout Departments”.

Mr Ramatlakane commented that it was important to find a formulation that stated the need for action. There were matters that had to be borne in mind, and persuasive terms had to be used.

Mr Swart suggested that findings be dealt with first, and thereafter the Report should state the recommendation that there had to be attention to compliance with the findings.

Ms Ngcobo expressed doubt whether departments would read the findings, and take cognisance of the Committee’s work.

Ms Mashigo said that the Report could be presented in Parliament and become meaningful. It gave the Committee a platform from which to follow up on concerns. The Report would be presented to Ministers, who were policy implementers. The Committee had to decide on the next step.

The Chairperson noted that departments were expected to take action. The Committee would want responses from departments in the next stage.

Mr Swart said that a previous report, which had been taken to Cabinet by former Minister of Finance, Hon Trevor Manuel, had been ignored. However, the Committee now had Act 9 of 2009 to support its work.

The Chairperson said that the Deputy President was bound to take the Report seriously. That was why the introduction proposed by Mr Snell was important. The Report had to be adopted. The introduction could not be integrated into the Report now and he suggested that, if the Committee agreed to the addition of the introduction, it be left to Mr Dlomo and Mr Snell to agree the final wording.

Ms Mashigo noted that no one was opposed to it.

Mr Snell said that the Report had to be tabled, stating what was possible.

The Chairperson agreed that the incremental, rather than formal implementation of Act 9 of 2009 had to be taken into account. The Speaker had stated that everyone had to work hard on implementing the Act. The Speaker had also told the Chairperson privately that the time was right for the implementation of the Act. A clear programme for the full implementation of the Public Finance Management Act and the Municipal Finance Management Act was needed.

Mr Dlomo stressed that it had to be stated that the report was related to Departmental annual reports and the reports of the Auditor-General.

Ms Mashigo affirmed that the Committee had always referred to specific departments.

Mr Ramatlakane suggested that Committee findings should include that the Committee had held hearings, and that departments had not complied with procedures in programmes. Secondly, it must include a recommendation from the Committee that certain departments must draw up turnaround plans and report back within 90 days. It must be clear in the report that departments had to come up with corrective measures.

The Chairperson noted that a Section 32 report could be added. He noted that specific reference must be made to the affected departments.  

The meeting was adjourned.

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