Public Audit Amendment Draft Bill: finalisation

Standing Committee on Auditor General

22 May 2018
Chairperson: Mr V Smith (ANC)
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Meeting Summary

The Public Audit Amendment Bill was initiated by the Standing Committee on the Auditor-General as a Committee Bill. The principal Act of 2004 did not give the Auditor-General the authority to take remedial action, nor to ensure that losses suffered by the State were recovered, where possible. Year on year the Auditor-General reported astronomical amounts of unauthorised, irregular and fruitless and wasteful expenditure. Hence the Public Audit Amendment Bill sought to amend the principal Act so as to inter alia provide for the Auditor-General to take remedial action to ensure that losses suffered by the State were recovered, where possible, and to refer suspected material irregularities for investigation. The Bill further sought to empower the Auditor-General to perform international audit work and to conduct performance audits, and to align the Auditor-General’s governance arrangements to current best practice.

In the meeting, the Public Audit Amendment Bill was considered section by section, and the Memorandum on the objects of the Bill was considered. The Bill was adopted without amendment.

The Committee report on the Bill was considered, and adopted with an amendment pertaining to funding for the additional powers of the Auditor-General.

Meeting report

Introduction by the Chairperson

The Chairperson announced that the object of the meeting was to see if the final product was indeed what the Committee had asked for. It had been workshopped at least twice. He further stated that the Bill will also be looked at technically, with attention to wording and spelling.

Finalisation and adoption of the Public Audit Amendment Bill

The Chairperson put the amendments up for final consideration by the Committee.

All 18 clauses were considered.

The Memorandum on the objects of the Bill was considered, which included the objects and content of the Bill; organisational and personnel implications; financial implications for the State; departments, bodies or persons consulted, and Parliamentary procedure.

Ms Z Dlamini-Dubazana (ANC) referred to the financial implications for the State (5.1, on page 12 of the Bill). The wording of a letter addressed to the Chairperson by the National Treasury (NT) did not have the same wording as in the Bill.

The Chairperson explained that the Minister was suggesting the kind of lines that had to be followed. It was not for the Executive to dictate what wording went into a Bill. The Minister had advised that Rands and Cents not be mentioned; otherwise it would be a Money Bill. The spirit of the communication was that financial implications were considered and covered from his side.

Adv Fatima Ebrahim, Parliamentary Legal Adviser, replied that the NT agreed with the revised wording. The legal drafters thought that it was originally too lengthy.

The Bill was put up for adoption and adopted without amendment.

Consideration and adoption of the report on the Bill

The Chairperson tabled the document for consideration.

The Committee went through the document page by page.

Mr N Singh (IFP) referred to recommendation 4.2, on page 3, in relation to the Minister’s letter. It was stated that the additional powers of the AG would be funded through the annual budget processes. The Minister was saying something else, namely that funding not catered for through audit fee regulations in the Principal Act were to be requested by the AG. The Committee was saying that it had to be funded, whereas the Minister was saying that it had to be requested. The report had to be in line with what the Minister was saying.

The Chairperson asked if it was indeed imperative for the report to be in line with what the Minister was saying.

Mr T Mpanza (ANC) commented that the report had to be consistent with what was stated under 5.1 (in the memorandum section) in the Bill. The report agreed in spirit with the Minister, although the wording was different. If the wording was changed in the report, it had to be changed in the Bill.

Ms Dlamini-Dubazana commented that it was not advisable to change the wording according to the wording of the Minister. The recommendations were stating the same as the Minister was saying, only the wording was different.

Mr A Mcloughlin (DA) stated that the wording of the recommendation had to be aligned with how it was worded in the Bill.

The Chairperson asked if he meant that it had to be word for word.

Mr Mcloughlin answered in the affirmative. The recommendation had to state that funding had to “be considered during the annual budget processes”.

The Chairperson asked the Committee Secretary what the exact wording had to be.

Ms Cindy Balie, Committee Secretary, replied that the wording had to be “will be considered during the annual budget processes”.

The Chairperson put the report up for adoption with the suggested amendment.

The report was adopted with the amendment.

The Chairperson noted that there would be lobbying for the Bill and the report to be ATC’d and adopted as soon as possible in the House. It would probably be done at the Chief Whips forum. It was desirable that it be ratified before Parliament rises in June. It could stand as a legacy project of the Committee. A debate would be requested. He could tell the powers that be, that it was unlikely that there would be opposing views. It could be reserved to caucus, but in principle everyone was on the same page. He thanked the legal team and the Auditor-General. Members would meet each other in the House.

The Chairperson adjourned the meeting.

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