Second Report of the Joint Budget Committee: adoption

Meeting report

JOINT BUDGET COMMITTEE
25 August 2003
SECOND REPORT OF THE JOINT BUDGET COMMITTEE: ADOPTION

Chairpersons: Mr Nene (ANC)

Relevant documents:
Second Report of the Joint Budget Committee, Draft 2, dated 26 August 2003 Part 1
Second Report of the Joint Budget Committee, Draft 2, dated 26 August 2003 Part 2
Second Report of the Joint Budget Committee, Draft 2, dated 26 August 2003 Part 3
Second Report of the Joint Budget Committee, Draft 2, dated 26 August 2003 Part 5
Second Report of the Joint Budget Committee, Draft 2, dated 26 August 2003 Part 6

SUMMARY
After discussing the recommendations made in their report the Committee adopted their report on national expenditure.

MINUTES
The Chair asked for nominations for someone from a committee member from the NCOP to join him in attending a Division of Revenue workshop due to the absence of Mr Ralane (Co-chair).

Mr Kgwele (ANC) proposed sending Mr Lucas from the Northern Cape to the workshop. He was seconded by D Rabie (NNP).

Mr Nene told members that the Departments of Education, Foreign Affairs and Social Development have replied to queries by the Committee but they had not received a response from the Department of Communications.

Mr Hanekom (ANC) noted that the Committee is engaged in a learning process and asked the researchers to make better use of the Estimates of National Expenditure. Most of answers to the queries from the Committee should be found in there. If then the Committee is still not satisfied, it could then call on the department for an explanation. Input from other portfolio committees could also be very important.

Mr Kgwele stated that this Committee is still finding its feet and should therefore take things one step at a time. They should also not be over-eager to jump in and change budgets.

Mr Hanekom agreed with his colleague and stressed the importance of their oversight role. He said that there is a fine line between tabling the committee's views and getting stuck in detailed discussions.

Dr Woods (IFP) emphasised the Committee's role in advancing the implementation of a system where spending is worked out on a costed basis from month to month, which is a more exact way of monitoring expenditure. He added that some budgeting is still very rough and suggested they revisit the Public Finance Management Act.

Mr Hanekom proposed including in the Report those departments who do not reply to the Committee's requests for information. It would be one way to put pressure on them.

The following recommendations were made in the committee report:

RECOMMENDATIONS

In view of the observations made on the expenditure trends of departments, the following are recommended:

· Given that some departments disburse conditional grants to institutions, the National Treasury's statements of revenue, expenditure and national borrowing should reflect the actual expenditure by departments separately. They should have an additional column or a different table showing whether the expenditure incurred was for special allocations or normal operational.
· In order to compare monthly planned expenditure to actual expenditure, the Joint Budget Committee should request cash flow statements of departments.
· Further capacity building has to be built into financial management procedures especially regarding the Public Finance Management Act of 1999, to ensure compliance with this Act.
· Formally structured co-operation between the Joint Budget Committee and other sector committees of Parliament should take place to allow for the flow of information especially in respect of peculiar Departmental spending patterns.
· The Joint Budget Committee should collaborate with the sector committees in interrogating the nature and quality of expenditure for those departments that have peculiar expenditure trends.
· The National Treasury should ensure timely publication of the monthly statements of revenue and expenditure to give the Joint Budget Committee sufficient time to scrutinise and report on these.
· The National Treasury should have a contact person who is capable of handling queries on the data in the statements of revenue and expenditure.
· Continuous technical and research support should be given to the Joint Budget Committee to ensure that it conducts its work smoothly.
· Capacity building in financial oversight should be a priority to the members of the Joint Budget Committee.

The report was adopted and the meeting was adjourned.