Additional Adjustment Appropriation Bill, Finance Bill: briefing & adoption, Division of Revenue Bill: briefing & FFC submission

Standing Committee on Appropriations

08 March 2012
Chairperson: Mr E Sogoni (ANC)
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Meeting Summary

The Committee was briefed by the National Treasury on the following three Bills: Finance Bill [B5-2012], Division of Revenue Bill [B4-2012] and Additional Adjustment Appropriation Bill [B6-2012].

Members had lots of questions about tolling such as was double dipping applied to motorists (fuel levy and toll) justified and if other funding sources could be used; how the system would differentiate between exempt and non-exempt vehicles; if registration would be required; what mechanisms were available to get exempt vehicles to register; and what penalties existed for failure to register. The Committee heard there would be no further contribution to the R5.75 million provided by National Treasury to ease in the introduction of tolling.

Members questioned the privatisation of national roads and why people were expected to pay to use roads when roads were the responsibility of government. Members asked if the increases would go up on an annual basis and if the cap of R550 was going to be reviewed on an annual basis. Members asked if the possibility had been considered that people would use alternate routes to avoid paying the toll fee and that there might cause congestion on these alternate routes. The impact of toll fees on inflation was explained to the Committee as well as how the fuel levy influenced the situation. The Committee expressed concern about whether the system would cope and what action would be taken against the many people determined not to pay the toll fees.

Members emphasised that the poor would suffer the impact, and cautioned against displaying arrogance towards the public. Treasury said there would be agreements with fleet management systems to deal with tourists on the roads or people driving rented vehicles. The Administrative Adjudicative System would increase the enforcement rate and speed up processes. The Committee invited the South African Road Safety Agency (SANRAL) to provide more detailed answers to questions as the National Treasure had not provided satisfactory answers.

Looking at the Additional Adjustment Appropriation Bill, Members asked if appropriate disciplinary steps had been taken against officials who had made unauthorised expenditure. Members asked why over-expenditure was allowed to continue unabated when this behaviour clearly undermined the approval of Parliament.

The Committee noted that disaster money for floods in the Northern Cape had not been paid out yet. The Department was advised to zoom into smaller municipalities as the biggest problems were located there. The Committee emphasised the importance of the Public Finance Management Act (PFMA) and the Municipal Finance Management Act (MFMA) and asked if action had been taken against defaulters.

The Committee heard that the South African Local Government Association (SALGA) felt left out of processes when it was keen to provide support and get involved at all levels. The most important issue that the Financial and Fiscal Commission was concerned about was that public entities had placed enormous pressure on the country in terms of long-term debt commitments.

Financial and Fiscal Commission  gave its input on the Division of Revenue Bill [B4-2012]. A new clause had been added in Chapter 3 which required Parliament to be consulted on any amendments to the conditional grants framework prior to publishing the allocations in the Government Gazette. FFC pointed out that personnel overspending had become a serious concern. There was a need to review perennially non-performing grants. A more rigorous process was needed for the design, introduction and phase out of grants.

The Committee heard that the allocation to the local government sphere would increase by R5.3 billion with the larger share being channeled to conditional grants. Whereas the Commission was in favour of a differentiated approach to funding and targeted support to poorer municipalities, it cautioned against the establishment of a funding stream that may potentially disincentivise councillors or ward committees from collecting more own revenue.

The Additional Adjustment Appropriation Bill [B6-2012] and the Finance Bill [B5-2012] were adopted.

Meeting report

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