Division of Revenue Bill [B2-2013]: public hearings; Parliamentary Budget Office Director Appointment: discussion

Meeting report

Division of Revenue Bill [B2-2013]: public hearings - Saselani Trust Bushbuckridge Submission

The Chairperson observed that despite an advertisement for written and oral submissions, there was only one written submission before the Committee. This was from Mr J P Mashego, Saselani Trust, Bushbuckridge. It did not speak to the Division of Revenue as such, but to issues of general nature. However, it was proper to table it to the Committee for noting or for Members; comments, if any.

Mr Mashego had suggested that the budget must be drawn with reference to statistics, excluding pensioners. Then, every person must be allocated a certain amount that was to be deposited in his or her account, for example, R1 million each. Those who received this money must also be given jobs such as road construction and maintenance, police service, or defence. From this money people would receive their salaries, and they would not be paid if they failed to fulfil their responsibilities. This suggestion was to prevent people having nothing to do, loitering in the streets or drinking in a tavern. Any person found roaming around the town or anywhere not being a pensioner was to be arrested and prosecuted. The duty of the police and soldiers was to ensure that no one eat or drank without working. This would reduce the misappropriation of funds, which hindered service delivery and would also reduce public protests, which were the result of [lack of] service delivery. There must be a budget allocated for construction of streets in all provinces. No ward councillor was to receive money for providing a service. People must alternate working hours since they would be working day and night shifts. No bar was to be operated; only bottle stores would sell alcohol for them to take home to drink after work. No person was to eat or drink without doing anything. There must be money allocated to learners who wanted to further their studies. Children who had matriculated but were currently not doing anything must go and study engineering and train for other jobs at further education and training (FET) colleges and universities. (See submission document)

Discussion
The Chairperson observed that the submission was of a general nature, rather than directly relevant to the Bill, but thought that it should be put before the Committee for noting.

Mr A Lees (KZN, DA) was intrigued by the content, especially by Mr Mashego’s second point. The R1 million gratuity to be paid to everyone would make everybody very happy. However, perhaps no one would then work which would make the rest of the suggestions about giving people jobs superfluous, if given a million rands every year.

Mr B Mashile (Mpumalanga, ANC) said that the early part of the comment, in which Mr Mashego suggested that those who received pensions or grants might be encouraged to work or at least do something, did make some sense. Especially those who received the Child Support Grant should have the receipt of the Grant linked to some kind of economic activity. Currently, many of those who received the social grants were really just sitting at home and not doing anything. This remark did not apply to schoolchildren who were going to school while receiving the social grant. On the other hand, there were those people who just roamed around while receiving the child support grant but who could not prove that they were actively looking for work. One of the messages that one received from this letter was to ensure that some of these people could be put to work in the security forces or the police so that they could at least engage in some kind of economic activity. Mr Mashego’s general thrust was a view that should be supported in the main, irrespective of the examples, as he was saying that one should not continue to give people money while they were doing nothing except just wait for the money. However, it was good for those people who were physically able to have their entitlement to a grant linked to some kind of economic activity so as to reduce their dependence on social security and to let them enter into the ranks of actively working people, and participate in the economic activity of the country. At that level, he agreed – it was good to connect these handouts to economic activity. However, he would have advised Mr Mashego to choose his words differently.

The Chairperson said that the problem with this submission was that it was not based on research. He could not believe that anyone with a pension was just sitting idly waiting for the next month to come. Conclusions like no body should eat or drink unless they were working and anyone found on the streets should be arrested, did not take us anywhere. To avoid wasting time, he wanted any discussion to be linked to the Division of Revenue.

Mr C de Beer (Northern Cape, ANC) (listen to sound recording) said that Mr Mashego’s submission sensitised Members to what people were thinking in preparation for Members’ return to their constituencies the next week for the 14 days of engagement with their structures. It was a reminder to tell constituents what the Division of Revenue Bill was, where the money came from, and for what it was allocated, so that one could have an informed cadre at grass roots level who could take the message further.
 
Mr Mashile referred to point 7, which clarified the message: 10m 20s. The general message was that the person was talking to the child support grant about which many people had complained and they had said that one was paying for people to produce children. It was a bigger message to connect an economic activity to those people who were entitled to people to get a grant. He gave an example of a disabled person in a wheelchair who was employed at a supermarket where he checked receipts. Because he feared that he might lose his pension, he left the supermarket. This kind of situation needed to be reviewed. He said that the current system was not helpful in so far as persons with disabilities were liable to lose their pensions if they undertook some form of economic activity, of which, despite their disabilities, they might be capable.

Mr M Makhubela (Limpopo, COPE) was inclined to agree with the Chairperson that Members could only note the submission. He referred to point 13, which indicated that the writer did not understand the Division of Revenue. As Mr Mashile had said, Members could have guided him in the wording of the submission.

The Chairperson observed that Members noted the submission.

Mr Mashile agreed that Members noted but that the Chairperson’s office should thank the writer of the submission as at least the person had shown enough interest to make a submission.

2013 Division of Revenue Bill provincial briefings: Members comments
The Chairperson said that on 09 April the Committee would continue further. He had received information that the briefings last week in the provinces had gone well. So on 09 April the Committee would expect to receive the negotiating mandates on the Division of Revenue. It was during the Constituency period but the Committee had applied for permission and permission had been granted.

Members commented on the previous week's provincial briefings on the Division of Revenue Bill.

Mr Lees commended Ms Wendy Fanoe, Chief Director: Intergovernmental Policy and Planning: National Treasury, for the excellent briefing which she led the previous week at the briefing in his province. He felt that the Committee could consider holding a meeting elsewhere in the country and suggested Ladysmith as a venue.

Mr De Beer said that it was the first time in his political career that a treasury official, in this case National Treasury, got a standing ovation in the committee of a provincial legislature after the briefing.

Mr Mashile said that National Treasury was well prepared in its briefing in Mpumalanga. However, it had not addressed the previous comments of the provincial legislature's committee. If it had, it would have been 'a top of the range briefing'. He looked forward to such briefings in future. He suggested that the Select Committee might hold a meeting in Nelspruit.

Mr Makhubela said that all members of the delegation who presented in Limpopo were well prepared. Indeed, 'they were super'. He thanked them. As a possible venue for a meeting, Limpopo was 'number one'.

Mr S Montsitsi (Gauteng, ANC) said that the provincial briefings in Gauteng had gone well and National Treasury had given a comprehensive presentation. He was pleased that National Treasury had taken on board the issue of the equitable share of revenue with respect to population. Gauteng provincial legislators hoped, however, that the rural areas, especially the sparsely populated municipalities, would not suffer, as a result of the population that had been lost by North West, Mpumalanga, and KwaZulu-Natal (KZN) and which had 'bloated' the population of Gauteng. The reason for this fear was that with this budget and the local government equitable share formula, the funding followed the population. With the lesser densely populated municipalities, Gauteng provincial legislators had thought that could be a problem. Probably there were stopgap measures that National Treasury had put in place. Otherwise Gauteng was 'quite happy'.

The Chairperson said that the provincial briefings this year were an improvement on those of last year, not that the previous ones were not good. However, this year's were more specific to provinces, as the Committee had requested in a previous meeting. All provinces were happy with the presentations and with the details. He hoped that this would be the situation going forward. He wished all the provinces good luck in their public hearings, and hoped to hear their views on 09 April.

Date of next meeting
The Chairperson said that the Committee had applied for permission to hold a meeting during the constituency period, on 09 April, in order to deal with the provincial negotiating mandates. The time and venue would be notified to Members.

He would inform Members of the venue for the meeting on 09 April 2012.

Committee minutes adoption
The Committee briefly considered and adopted its minutes for 19 February and 06 March 2013.

The Chairperson adjourned this part of the meeting, the portion in which the Appropriations Standing Committee had dealt with the Division of Revenue.
 
Joint meeting with the Finance Select Committee - Parliamentary Budget Office Director appointment: discussion
Immediately thereafter, Members reconvened in a joint meeting of the Appropriations and Finance Select Committees, the membership of both Committees being exactly the same, with Chairperson Chaane and Chairperson De Beer (of the Finance Standing Committee) sitting together as Co-Chairpersons.

Co-Chairperson Chaane said that Professor Mohammed Jahed had been on secondment to Parliament from the Development Bank of Southern Africa (DBSA) since May 2012 to set up the Parliamentary Budget Office, which had been launched on 26 February 2013, a day before the tabling of the budget. As a Member of the Political Task Team (PTT) on the Parliamentary Budget Office, he could report that the PTT Members were all happy with the work that Prof Jahed was doing. The PTT saw the need to drive that process so that the Parliamentary Budget Office was fully fledged. The Money Bills Amendment Procedure and Related Matters Act (No. 9 of 2009) provided that the four financial committees – the Appropriations and Finance Standing Committees of the National Assembly and the Appropriations and Finance Select Committees of the National Council of Provinces (NCOP) had to start the process. The structure was tabled. There was some discussion at the PTT level and its Members had sought the views of the political parties on the appointment of the Director. The view was widely held that consideration should be given to the current incumbent given the work that he had done thus far. His qualifications, experience and knowledge seemed to be meeting the requirements stipulated in the Money Bills Amendment Procedure and Related Matters Act 2009, and if was felt that it was important to acknowledge the principles of continuity and ensure that the Parliamentary Budget Office was speedily established. So the PTT was tabling this proposal, and the Finance Standing Committee had discussed it the previous week (see meeting report 19 March 2013). One Members reached agreement, this Select Committee could in its next meeting adopt its report and table it to the House. The PTT had consulted with the legal advisers, especially Advocate Frank Jenkins, Senior Parliamentary Legal Adviser, to check the legality of the matter and the PTT had found it to be in the legal framework. According to the Act the appointment process most be open and transparent.

Mr Mashile cautioned that one must guard the freedom that had been hard-won, as such freedom might be stolen and then we would be back to that era to which no one wanted to go back. On the other hand, given all the study tours and other efforts that Prof Jahed had made, one would want to sustain the momentum. Otherwise there might be backsliding, after which it would be necessary to start all over again from the beginning. No one wanted to do that. However, there was a need to engage the legal experts and obtain their advice in meeting some challenges. At the same time, he supported the appointment of Prof Jahed so as not to lose the momentum.

Mr Makhubela said that the only problem was the technical matter of the appropriate process. (Listen to sound recording)

Mr Lees said that there was general agreement that Prof Jahed was the best person for the job but there had been concerns raised about the process. He believed that even if Members followed the due process Members could still make an appointment quickly but avoid accusations that unknown candidates could not contest the position. He and his party were keen to see the Parliamentary Budget Office in place, but given that it was now March it would still be possible to make an appointment by July. He put this before the Committee as a way of avoiding the unpleasant publicity about this appointment if Members did not open it up to everyone. He acknowledged what Mr Mashile had said.

Co-Chairperson Chaane said that the PTT, on the matter of procedure, had requested Adv Jenkins to conduct further research on the process itself so that any legal gaps were found these would be attended to. The advice so far received was that the Act did not prescribe a specific procedure. This Act was 'silent': one could either 'head-hunt' or advertise. Each of those approaches had its own pros and cons. So the PTT did not want to rush this matter but first agree on the principle. Also this year was going to be a short year, as political parties would, as early as June start wanted some of their Members to be deployed in critical areas [and perhaps this might affect their attendance in committees] so the PTT wanted to make an early appointment. However, the PTT would keep Members fully informed. The PTT had also agreed to meet to discuss the issues raised and table a progress report.

Adv Jenkins said that the Co-Chairperson had covered everything. The Act was 'silent'. As the Co-Chairperson had said, it did not require a competition or advertisements.

Mr Mashile said that this was exactly what Members needed to guard against. Adv Jenkins should assist Members by ensuring that they attended to that particular manner. That the Act was 'silent' did not mean that Members need not do something. There was a general expectation of Members, who were going to be asked what should be done under normal circumstances. There should be serious attention to the process backed by a clear legal opinion, not just on the basis that the Act was 'silent'.

Co-Chairperson Chaane agreed with Mr Mashile. He noted that the Committees had agreed that morning that Adv Jenkins would 'continue doing a thorough legal research on the matter'. He noted that meetings were announced in 'the Z list', the parliamentary agenda to inform members of the public of which committees were sitting and what they were discussing. This was so that anyone interested could observe. He would expect Adv Jenkins' opinion, and he would forward it to Members before the Committees finalised the matter.

Co-Chairperson De Beer said that 'We met before this meeting and there was agreement about the process we are going to follow as you conducted the procedures in this meeting'. He had nothing else to add on the matter. He advised Members that they would meet again, as the Select Committee on Appropriations, on 09 April. The next engagement would be a joint engagement in Limpopo on 22 to 26 April of the Appropriations and Finance Select Committees. There would be another joint meeting on 30 April in terms of the programme.

Co-Chairperson Chaane said that Members would pursue this discussion in the next meeting. He then declared the meeting adjourned.