Committee Report on Fiscal Framework and Revenue Proposals: consideration and adoption

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Finance Standing Committee

05 March 2015
Chairperson: Mr Y Carrim (ANC) and Mr C de Beer (ANC)
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Meeting Summary

The Standing Committee and Select Committees on Finance adopted the draft report on the Fiscal Framework and Revenue Proposals relating to the 2015 Budget. The draft report was adopted with amendments. The amendment related to tightening and rewording recommendation 4.18 that proposed centralised procurement. Members also agreed that a new recommendation be added. This related to government incentives for businesses to drive job creation. Opposition parties reserved their right to vote on the draft report. The report would be published in the ATC on 6 March and the matter would be debated in the National Assembly and the National Council of Provinces on 10 March.

 

Meeting report

Report on the 2015 Fiscal Framework and Revenue Proposals

Mr Carrim referred Members to the draft Report on the 2015 Fiscal Framework and Revenue Proposals.

 

Mr Carrim suggested that just as there were public hearings on the Budget, there should perhaps also be public hearings on the State on the Nation Address.
 Dr B Khoza (ANC) agreed.

 Mr Carrim stated that there were new recommendations (see document) added to the draft report. These were:

4.3 While the Committees acknowledge National Treasury’s good work in improving the quality of spending at local government level, more needs to be done in this regard, in cooperation with the national and provincial departments of the Department of Cooperative  Governance and Traditional Affairs and the provincial treasuries.

4.7 National Treasury, working through the Presidential Infrastructure Coordinating Commission (PICC) and together with other departments, needs to contribute more to the speedier and more effective implementation of the National Infrastructure Plan.

4.9 National Treasury needs to provide more information on the assumptions on which its revenue proposals are based on their impact, as well as more information on the impact of the Budget on the poor.

4.19 While the Committees understand the need for Eskom to charge cost-reflective tariffs, they feel that this should be done in ways that do not disadvantage the poor and needy.

 Discussion focused on recommendation 4.18.

The recommendation states: While the Committees welcome the centralised Supply chain Management process it is important that National Treasury ensures that local service providers are not unduly disadvantaged.

In the draft proposal, additional sentences had been added to the recommendation. They read: The Committees welcomed the proposals for centralised procurements, including textbooks for January 2016. The proposal to centralise school construction and decentralise their maintenance is also welcomed. NT needed to monitor the implementation of these proposals, and the Committees will require progress reports in this regard.

Mr F Essack (DA, Mpumalanga) asked if, by decentralising maintenance, were “they not shooting themselves in the foot”. Perhaps it would be better to specify that treasury needed to monitor and the Committee should get reports.

Mr De Beer queried which House would be responsible for the oversight- the National Assembly or the National Council of Provinces.

Ms E Lingen (DA, Eastern Cape) said it was not clear who was the Supply Chain Management. It needed to be distinct.

Mr Carrim said that it appeared Members agreed with the point in principle but the language needed to be tightened and re-worded.

Members agreed that a concern raised in public hearings around the Public Sector Wage Bill needed to be addressed in the draft report.

Mr L Gaehler (UDM, Eastern Cape) agreed that there needed to be more information.

Mr Carrim said sensible people agreed to keep the PSWB, but Parliament was not a negotiator. The Parliamentary Budget Office had said in certain conditions there was sluggish economic growth if the PSWB was reduced.

The parliamentary staff were requested to include a recommendation that there would be government incentives for business for job creation.

 

The report was adopted with amendments. Opposition parties reserved their right to vote and indicated that they would oppose the framework and revenue proposals.

 

Mr Carrim said the report would be published in the ATC on 6 March and the matter would be debated in the National Assembly and the National Council of Provinces on 10 March.

The meeting was adjourned.
 

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