Money Bills Procedure and Related Matters Act: review update

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Finance Standing Committee

02 May 2017
Chairperson: Mr Y Carrim (ANC)
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Meeting Summary

The meeting commenced with preliminary remarks by the Chairperson on the appropriate procedure for convening joint committee sittings. A Senior Parliamentary Legal Adviser from the Constitutional and Legal Services Office in Parliament presented an updated review of the Money Bills Procedure and Related Matters Act. He explained the background of the Act, the processes leading to its Discussion Document, and the changes proposed for the Act. He identified the priority areas as timelines, sequencing, and the Parliamentary Budget Office (PBO). Consequential matters that need to be resolved in the Act are language improvement, ambit of the Act, corrections, and insertion of words to clarify certain meanings. He pointed out the way forward as adoption of policies and procedure by the Committee, development and consideration of a draft amendment Bill, public hearings on the draft amendment Bill, adoption of a report after the public hearings, finalising in the introduction of a Committee Bill.

In discussion, Members sought clarity on technical aspects of the presentation. The DA suggested that the Parliamentary Budget Office should be able to be approached by opposition members of the Committee for assistance. It also warned of budget risk due to uncertainty and suggested that the fiscal framework should be locked down in the first instance to avoid a new element of risk in the sovereign credit rating. The DA suggested another priority area in the review of the Act is to provide clarity on the process for proposing budgetary amendments in Parliament.

In response it was noted that paragraph 4 of the Discussion Document accommodates multi-party participation, while measures for locking down the fiscal framework are already in place. The Legal Adviser conceded the need for added priority areas, but said these require rules, procedures, and timelines for implementation. The Chairperson suggested that requests to the Parliamentary Budget Office should be made through the Committee, which should be agreeable to requests for access. He declared that the review of the Act will be finalised in a joint committee.
 

Meeting report

The Chairperson, remarking on the low turnout of members for the meeting. He stated that any member proposing a joint meeting with other committees must take responsibility for facilitating that meeting. In addition, the member must be from the majority party in Parliament. He noted that the Insurance Bill is not finalised, and that the Committee focus is the review of the Money Bills Procedure and Related Matters Act. He stated that he would no longer perform administrative duties due to his other commitments.

In response to a question on whether the Committee had received an invitation to the World Economic Forum (WEF), the Chairperson replied that it had not and explained that parliamentarians are not usually invited to the WEF. Unlike the World Bank which has a parliamentary forum, the WEF has none. He drew a distinction between invitations he receives in his official capacity and invitations addressed to the Committee generally.

The Chairperson called on the delegation from the Constitutional and Legal Services Office (CLSO), led by Senior Parliamentary Legal Adviser, Adv Frank Jenkins, to brief the Committee.

Review of the Money Bills Procedure and Related Matters Act: briefing by CLSO
Presenting, Adv Jenkins noted the background to the Act and the reasons for the Discussion Document on the Review of the Act. He explained the changes proposed to the Act. The following aspects of the Act are unchanged:

• Conditional appropriation – Section 10(7)
• Pass Bill within four months after FY begins – S. 10(10)
• Minister given ten days to respond
• At least 2 days for ministerial response – S. 12(9)
• At least 4 days for ministerial response S. 12(13) and (17)
• Timeframe for ministerial response – 14 days S. 13(3).

The following changes are proposed:
• Division of Revenue Bill (DoRB) – S. 9(1) referred after adoption of fiscal framework is changed to require reporting on DoRB
• Appropriation Bill – S. 10(1) and (3) referred after adoption of fiscal framework is changed to require reporting after DoRB is passed
• National Adjustments budget – DoRB referred to joint sitting changed – S. 12(6)
• Sequencing changed to allow referral of Adjustments Appropriation Bill prior to passing of DoRB. Reporting is only allowed after the DoRB is passed – S. 12(15).
• 9 days within which to report on fiscal framework changed to allow programming – S. 12(7)
• 9 days to report on the DoRB changed to allow programming

Adv Jenkins explained that section 13(4) implies consistency with the fiscal framework. The proposed section 13(6) allows amendments to money Bills notwithstanding prevailing fiscal framework. Section 15 of the Act establishes the Parliamentary Budget Office (PBO) and provides for its functions, appointment and removal of director, reporting format to Parliament, and management. The key issue as how the PBO can be aligned to the Financial Management of Parliament and Provincial Legislatures Act (FMPPLA) or include fiduciary duties for the Director as accounting officer for an entity.

Adv Jenkins explained that consequential matters that need to be resolved in the Act are:
• Improvement of language used in the Act
• Application of the Act
• Correction of S. 11(4)(c), which incorrectly refers to subsection (7) instead of (6)
• Correction of section 12(6) to ensure constitutionality of legislative process
• Corrections to the latest terminology used in performance reporting in S. 5(1) and typographical corrections in S. 6(2)(d).
• Insertion of words to clarify certain meanings.

Finally, Adv Jenkins explained the norms and standards for provincial legislatures. He pointed out the way forward as:
• Adoption of policy decisions by the Committee
• Adoption of processes
• Development and consideration of a draft amendment Bill
• Public hearings on the draft amendment Bill
• Report with a draft Bill after public hearings for introducing a Committee Bill.

Discussion
Ms P Kekana (ANC) advised Adv Jenkins to liaise with Treasury on the technical aspects of the Bill. She complained that aspects of his presentation are too technical and sought clarity on them.

Mr D Maynier (DA) noted that paragraph 4 of the Discussion Document dealing with the PBO should be bi-partisan. Disagreeing with Adv Jenkins, he stated that paragraph 9 on fiscal framework puts a flexible approach at risk. He suggested that a rigid approach must have timelines that will allow Parliament to consider the budget timeously. There is also budget risk due to uncertainty. He suggested that the fiscal framework should be locked down in the first instance to avoid a new element of risk in the sovereign credit rating. Rating agencies and markets look out for certainty. He noted that opposition parties cannot access the PBO because only committees are allowed access. He suggested the introduction of an extra priority area for the amendments: to provide more clarity about proposed budgetary amendments. For example, the opposition unsuccessfully proposed 398 amendments in 2016. Accordingly, a process and timeline should be stipulated for proposing budgetary amendments.

Responding, Adv Jenkins explained that paragraph 4 of the Discussion Document makes room for multi-party participation. The main issue is whether an advisory board is needed.

The Chairperson remarked that Mr Maynier appears to be obsessed with co-governance with the ruling party. He stated that requests to the PBO should be made through the Committee to avoid using the PBO for ideological purposes. However, the Committee should be agreeable to requests for access to the PBO.

Mr Maynier replied that no rule constrains the PBO to do research only referred to them by the Committee, rather than members of the Committee.

The Chairperson reiterated that requests to the PBO should be made through the Committee, which should be agreeable.

Adv Jenkins conceded the need for new priority areas. However, priority areas need rules, procedures, and timelines for implementation. He replied that measures for locking down the fiscal framework are already in place. However, he would consult with Treasury on this.

The Chairperson stated that an advisory board can be arrived at as a compromise. Such a board should be made up of chairs of committees. He noted that “398 amendments” sounds impressive.

The Chairperson declared that the review of the Act would be finalised in a joint committee and adjourned the meeting.
 

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