ATC201208: Report of the Select Committee on Appropriations on the Second Adjustments Appropriation Bill [B25 – 2020] [National Assembly (Section 77)], Dated 08 December 2020

NCOP Appropriations

REPORT OF THE SELECT COMMITTEE ON APPROPRIATIONS ON THE SECOND ADJUSTMENTS APPROPRIATION BILL [B25 – 2020] [NATIONAL ASSEMBLY (SECTION 77)], DATED 08 DECEMBER 2020

 

1. Introduction

 

The Minister of Finance tabled the 2020 Medium Term Budget Policy Statement (MTBPS) on 28 October 2020, outlining the budget priorities of government for the medium term estimates. The 2020 MTBPS was tabled in Parliament with the Second Adjustments Appropriation Bill [B25 - 2020] (the Bill). Section 12 (15A) of the Money Bills and Related Matters Act No. 9 of 2009 (as amended) provides that “after the National Assembly passed the Adjustments Appropriation Bill, the Bill must be referred to the National Council of Provinces and referred to the Select Committee on Appropriations.” Accordingly, the NCOP referred the Bill to the Committee for concurrence on 04 December 2020.

 

1. Public participation process

 

To facilitate public participation and involvement, and in compliance with section 72 of the Constitution of the Republic of South Africa, an advertisement was published in national and community newspapers from 30 October to 6 November 2020,inviting the general public and all interested stakeholders to make written submissions and comments on the Bill.In addition to the National Treasury briefing the Committee on the contents of the Bill, the Committee was also briefed by Financial and Fiscal Commission (FF) and the Parliamentary Budget Office (PBO) on 11 November 2020. During a public hearing, held jointly with the Standing Committee on Appropriations on 27 November 2020, oral submissions were made by the Public Service Accountability Monitor (PSAM) and the C19 People’s Coalition.

 

1. National Treasury briefing

 

The Bill provides for an increase in allocations set out in the main Appropriation Act of 2020. The Billfurther provides for the allocation of funds for the implementation of the South African Airways (SAA) business rescue plan.The totalnet effect of the Bill is an increaseof R37.7 billion in vote appropriations. The Bill also provides for the reprioritisation of funds between and within votes. A total of R44.3 million has been shifted from the Department of Public Works and Infrastructure to the National School of Government. Furthermore, a total of R1.8 million has been shifted from the Department of Environment, Forestry and Fisheries to the Government Communication and Information System (GCIS).

In addition, the Bill provides details of unforeseeable and unavoidable expenditure in terms of section 6(1) of the Appropriation Act of 2020, amounting to R20.4 billion. The votes concerned, are the departments of Cooperative Governance; National Treasury; Public Works and Infrastructure; Basic Education; Health; Social Development; Agriculture, Land Reform and Rural Development; Environment, Forestry and Fisheries; Science and Innovation; Sports, Arts and Culture; Trade, Industry and Competition; and Transport.

 

Moreover, the Bill provides for roll-overs amounting to R1.6 billion. The affected departments are The Presidency; National Treasury; Basic Education; Police; Human Settlements; Transport and Water and Sanitation. The Bill also outlines self-financing expenditure by certain departments to the amount of R1.5 billion, which will be paid into the National Revenue Fund (NRF). The relevant departments are The Presidency; GCIS; Home Affairs; Correctional Services; Defence and Trade, Industry and Competition.

 

Despite section 3 of the Appropriation Act and section 43(4) of the Public Finance Management Act, the Minister may, for purposes of service delivery, approve that unspent funds in an amount in Schedule 1 or 2 intended for –

(a) compensation of employees, be used within the same national department for transfers and subsidies for the payment of severance or exit packages;

(b) transfers and subsidies to other institutions, be used elsewhere within the same main division; or

(c) payments for capital assets be used elsewhere in any main division within the same national department or surrendered to the NRF.

Declared unspent funds amounted to R187 million, of which the departments of Public Works and Infrastructure and of Employment and Labour accounted for R181 million and R6 million, respectively. However, the National Treasury projected underspending to the amount of R2.1 billion.

 

National Treasury indicated that the following virements must be approved by Parliament:

 

• Basic Education (Vote 16): A proposed total of R28.6 million is shifted from the School Infrastructure Backlogs Grant for the procurement of teaching toolkits andcomputers; audit costs and the maintenance of the FundzaLushaka information management system.
• Defence (Vote 23): A proposed total of R606.4 million is shifted from the special defence account on various programmes to fund extended deployments of South African National Defence Force (SANDF) members.
• Police (Vote 28): A proposed total of R1 million is shifted within the visible policing programme to pay donations to non-profit institutions.
• Employment and Labour (Vote 31): A proposed total of R350 000 is shifted from compensation of employees to pay various claims against the state.
• Trade, Industry and Competition (Vote 39): A proposed total of R10 million is shifted from the goods and services budget of economic research and coordination to the industrial competitiveness and growth programme to fund an infrastructure upgrade for the South African Bureau of Standards.
• Transport (Vote 40): A proposed total of R2.3 billion is shifted from various capital projects within the rail transport programme to pay for financial assets of the Airports Company of South Africa (ACSA) within the civil aviation programme. Furthermore, a proposed total of R155.5 million is shifted from the road transport programme to the South African Civil Aviation Authority.

 

1. Stakeholder submissions

 

1. Financial and Fiscal Commission (FFC)

 

While the Financial and Fiscal Commission (FFC) appreciated that government’s Economic Reconstruction and Recovery Plan (ERRP) strengthened the continuity and consistency of the position taken in the 2019 Strategy document: Economic Transformation, Inclusive Growth and Competitiveness; it argued that consistency should not be confused with repetitions without proof of real reforms, impacts and outcomes, which may lead to policy, and the implementation of government programmes, losing credibility. The FFC was in agreement with the thrust of the ERRP and the key elements identified by the President; and the expectation had been that the 2020 MTBPS would respond to these pillars of recovery and allocate resources appropriately. The FFC looked at the alignment of budgets with the key elements of the ERRP.

 

The FFC also expressed concern over the lack of upwards adjustments or decreases envisaged for the 2021/22 financial year in Basic Education, Agriculture, Defence and social security funds. It expressed particular concernover the implications of no increases in the Basic Education allocation. The FFC recommended that the implications of budget cuts in the affected departments be detailed and understood, in order to mitigate any negative effects. It further submitted that the attempt at large fiscal adjustment may impose unsustainable social pressures, impact on the economic recovery and deal a second blow to livelihoods of South Africans on top of the COVID-19 catastrophe.

 

The FFC was of the opinion that the economic relief package was unlikely to achieve the expected results with its limited budget. The negative and marginal expenditure growth rates in a number of crucial votes for 2021/22, as evidenced in the GDP growth forecasts, implied dire economic and social conditions in the future.The FFC was of the view that some elements of the economic stimulus, for instance the Bank Loan Guarantee Scheme (BLGS), needed to be extended to the 2021/22 financial year in order to mitigate the effect of the COVID-19 pandemic. According to the FFC, the BLGS was one of the interventions that could have a measurable impact at lower levels, but business owners were reluctant to incur more debt under uncertain business conditions and a weak economic outlook.

 

Regarding the proposed R10.5 billion allocated to the SAA to implement its business rescue plan, the FFC recommended the expeditious establishment of the proposed Presidential State-owned Enterprises Council, that would provide strategic oversight of SOEs; ensuring thattheir dependence on the fiscus was reduced by addressing their financial, operational, business model and people challenges and ensuring their proper rationalisation.

 

The FFC reported that the average spending by national government departments at the end of September, was 54 percent of their total budgets. However, certain departments such as Higher Education, Social Development, Small Business and Basic Education, had far exceeded the spending norm of 50 percent, which could be due to COVID-19 related spending pressures. Departments such as Agriculture; Human Settlements; Energy; Science and Innovation; Tourism; Trade and Industry; Public Works; Women; Employment; Communication and Health had registered spending below the norm of 50 percent. In spite of the challenges brought about by the COVID-19 pandemic, the FFC remained concerned about excessive deviations below or above the norm from an expenditure smoothing perspective; and indicated that, unless a department’s in-year cash management plan explicitly identified such deviations as a chosen spending profile, departments should be confined to spending performance guidelines.

 

1. Parliamentary Budget Office (PBO)

 

The Parliamentary Budget Office (PBO) submitted that appropriations per vote had increased by R37.7 billion from R963.1 billion in the main 2020 budget to R1 025.3 billion in the second adjustmentsbudget. The PBO also highlighted the virements and shifts between main divisions or programmes which were allowed during the adjustment appropriations process; of which six (Basic Education; Police; Trade, Industry and Competition; Employment and Labour; Transport and Defence) required Parliament’s approval.

 

The PBO further highlighted the spending trends compared to performance and submitted that South Africa’s public spending levels were not matched by high levels of quality or efficiency in the services delivered. Preliminary findings on spending reviews, which formed part of the budget system, indicated the following:

• Many policies were designed and adopted without considering their total costs and affordability.
• Multiple institutions shared overlapping responsibilities or mandates, leading to duplication of work.
• In several high-spending procurement areas, including information and communications technology and infrastructure, it appeared that government was overpaying for goods and services.

 

4.3 Public Service Accountability Monitor (PSAM)

 

The submission from the Public Service Accountability Monitor (PSAM) highlighted possible interventions to “build back better” after the COVID-19 pandemic; as well the importance of entrenching the views and needs of those most affected by fiscal and budgetary decisions, in the budgeting process.

 

PSAM made the following recommendations related to the Bill:

• The Committee should request the National Treasury and Cabinet to review and reverse the decision to reduce the budgets of departments such as Heath, Human Settlements and Education to fund the R10.5 billion for the SAA business rescue plan; with a view to avoiding a worsening crisis in the public service in future.
• Illicit financial flows should be addressed by reversing the R 238 million decrease in the budget allocation to the South African Revenue Service (SARS); and by significantly increasing its resources; as allocating sufficient budget to strengthen tax administration is an investment in the long-term financial stability of the country.
• With regard to the net reduction of R120.6 million in the funding for Statistics South Africa (Stats SA); the Committee should consider the calls by various role-players to rather identify alternative, non-strategic programmes to be cut; given that a functional statistical agency is core to developing the capacity to deliver well-targeted public services and to address the high levels of poverty and inequality.
• While zero-based budgeting has the potential to improve the efficient management of public funds while there is a dire need to entrench effective financial management and eliminate wasteful expenditure; a cautionary approach is needed, given key capacity limitations and possible adverse impacts. National Treasury should also outline the efforts to be taken to ensure adequately participatory and transparent processes to meet the demands of zero-based budgeting. This also presents an opportunity to explore what kind of state capacity would be required, and to give effect to key components of the National Development Plan.

 

In addition, PSAM made the following broader recommendations to address corruption in public procurement:

• Ensure transparency in public procurement and the availability of open data about procurement plans, tenders, contracts, bidders and their beneficial owners in order to enable better prevention and detection of corruption risks, improving opportunities to spot abuses.

• Ensure access to high-quality, standardised information about the full cycle of money flows, in line with the globally recognised open data standards, such as Open Contracting Data Standard (OCDS) or Beneficial Ownership Data Standard (BODS) in order to allow for better analysis and detection of corruption risks.
• Incorporate and use high-quality open data in order to empower civil society, journalists, academics and businesses to effectively follow the trail of public resources.

 

In closing, PSAM asserted that budget priorities must be open to public input given that they were intended to serve the developmental needs of the people; and that enabling thorough scrutiny and debate of priorities set in the budget processes was crucial and could not continue in its current form. In order for the potential benefits of transparency to be realised, the executive should release better budget and outcomes data and the legislature and civil society should be able to use that information in a vibrant budget debate.

 

4.4 C19 People’s Coalition

 

The C19 People’s Coalition (C19) submitted that the 2020 Adjusted Estimates of National Expenditure (AENE) hollowed out national institutions, undermined the social compact, and enabled a growth in illicit financial flows by weakening tax administration. It was of the opinion that the state had failed to protect the most vulnerable members of society during COVID-19; as the number of households experiencing hunger had doubled and inequality had risen as job losses overwhelmingly affected the working poor, black people, and people living in rural areas.

 

C19 gave an overview of the proposed public wage bill cuts and expressed concern that labour was forced to carry the consequences of the elite’s financial mismanagement in both the public and private sector; indicating that this was not compatible with the requirements of a social compact. C19 further expressed concern over the reduction of R238 million in the allocation to the South African Revenue Service (SARS). It highlighted the fact that tax revenue was expected to be R313 billion less than the February 2020 forecast, partly as a result of increasing illicit financial flows; while SARS experienced a capacity gap due to the number of critical vacancies.

C19 expressed serious concern over the R1.9 billion reductions in the Basic Education budget; indicating that the total spend on education had declined year-on-year for the last four years. C19 further indicated that the global pandemic had necessitated careful central planning and increased resources in order to address long-standing water infrastructure backlogs and insufficient textbooks and teachers, in order to reduce the risk of COVID-19 transmission in schools; and to strengthen the school nutrition programme in the face of widespread and growing hunger. C19 did not agree with government that Basic Education was not a frontline department in the fight against the pandemic. C19 was further concerned over the increase in the use consulting services and agency staff; indicating that reducing the budget while increasing reliance on external services, eroded the institutional memory and capacity vital to sound public administration.

 

C19 submitted that a single, national and universal healthcare system was required to ensure that healthcare spending became more efficient, effective and just; and that the National Health Insurance (NHI) was central to this plan. C19 expressed concern over the R390 million cuts in the Health budget, including in the NHI grants (direct and indirect), the HIV, TB, Malaria and Community Outreach Grant, and the Health Facility Revitalisation Grant. C19 indicated that the pandemic had revealed the mounting health threats posed by backlogs in dealing with infectious diseases such as HIV and TB; and that Community Health Workers (CHWs) had been central in supporting health system preparedness during emergencies such as COVID-19 and TB.

 

With regard to Social Development, C19 submitted that the mischaracterisation of social spending as unsustainable or wasted expenditure being provided to an “unproductive” poor at the expense of some other “more important” investment, was extremely harmful. It indicated that, while the economic benefits created by income security were well documented, there was a moral imperative to provide urgent and necessary social assistance to ensure a dignified life for all.

 

C19 made the following recommendations, to which it requested National Treasury to provide a public written and oral response:

 

• Address illicit financial flows by reversing budget cuts to the South African Revenue Service (SARS) and significantly increasing its resources; as allocating sufficient budget to strengthen tax administration is an investment in the long-term financial stability of the country.

• Deprioritise spending on defence in order to free up funds for deepening social policy and strengthening public administration.
• Significantly reduce the use of consultants and outsourced services while consolidating and investing in a dedicated professional civil service.
• Reverse cuts to the education cluster and reclassify Basic Education as a frontline service.
• Reverse cuts to healthcare; remove medical aid tax credits and prioritise resources for implementing the National Health Insurance (NHI).

• Provide adequate budget for Community Healthcare Worker (CHW) compensation, as legally agreed upon in 2016. Universal healthcare can only be successful if CHWs receive adequate training, infection prevention, protective equipment and remuneration to provide frontline healthcare.
• Move to a guaranteed income for all. Given unprecedented unemployment, instead of taking grants away after January 2021, government must build on these to provide a dignified basic income guarantee (BIG) that is universal, unconditional and redistributive. This should be financed through annual progressive wealth tax and increasing personal income tax for the top 2 percent of earners.
• Initiate a formal enquiry into which conditional grants have been subject to delays in payment and what the reasons for delays are. 
• Members of Parliament must ask suitably rigorous questions about the cost implications of large energy projects. 
• Recognize that the OR Tambo District Municipality has been hit by a tornado and nearly 400 people have been left homeless. Disaster relief measures, in line with the attendant enabling budgetary processes, need to be implemented.

 

5. Observations and Findings

 

The Select Committee on Appropriations, having considered the inputs from the above stakeholders on the Second Adjustments Appropriation Bill [B25 - 2020], made the following findings:

 

1. The Committee notes and welcomes the fact that, relative to the 2020 Budget, the total main budget non-interest expenditure for 2020/21 has increased by R36 billion for the COVID-19 fiscal relief package. However, the Committee remains concerned over the lack of upwards adjustments or decreases envisaged for the 2021/22 financial year in Basic Education, Agriculture, Defence and social security funds.

 

1. The Committee welcomes the provisional allocation of R19.6 billion set aside in the special adjustments budget, mainly for job creation and protection. Of this amount, R6.8 billion is allocated to the Department of Social Development to fund the extension of the special COVID-19 Social Relief of Distress (SRD) Grant until 31 January 2021. R12.6 billion of the allocation targets various sectors, such as National Treasury; Health; Social Development; Agriculture, Land Reform and Rural Development; Environment, Forestry and Fisheries; Sport, Arts and Culture and Transport, to create employment opportunities as part of the COVID-19 interventions. The Committee further welcomes the additional R1 billion for food relief to vulnerable households.

 

1. The Committee notes the following in-yearspending adjustments: R23 billion for Eskom; R6.5 billion for the South African Airways (SAA) to settle its guaranteed debt and interest; R84.7 million for the Independent Communication Authority of South Africa (ICASA) for licensing the high-demand spectrum; as well as reductionsin the amount of R36.5 billion from compensation of employeesas a result of the salary freeze. As part of in-year adjustments, the Committee notes the R10.5 billion additional allocation earmarked for the SAA to implement its business rescue plan; which is mainly funded through reductions to the baselines of national, provincial and local government and other public entities; and whichmay delay the implementation of other, critical departmental initiatives.

 

1. The Committee welcomes the intended efforts to ensure that, over the medium term, greater efficiency and reprioritisation is achieved to protect service delivery in areas such as primary healthcare, immunisation, and HIV prevention and treatment. However, the Committee is concerned about the slow progress in the implementation of the National Health Insurance (NHI) and the delays in building the required capacity for NHI implementation by the Department of Health. 

 

1. The Committee welcomes the review of the operating model of the Passenger Rail Agency of South Africa (PRASA), to return it to financial and operational sustainability. However, the Committee is concerned about the lack of expenditure on its capital budget as a result of delays in maintaining rail infrastructure and other capital projects.

 

1. The Committee welcomes the R540 million set aside for the tourism equity fund to support black-owned and commercially viable enterprises to acquire shares in tourism enterprises. It also welcomes the intention to extend the short-term tourism relief fund to mid-2021 in order to assist eligible small, medium and micro-enterprises with working capital.

 

1. The Committee notes that the South African Police Service (SAPS) is allocated a roll-over amounting to R252.8 million, mainly for personal protective equipment (PPE) which was procured in 2019/20 but only delivered in 2020/21. This is rather concerning, since any delays in PPE delivery will endanger the lives of people, given the risk posed by COVID-19.

 

1. As part of the fight against corruption, the Committee notes the R63 million allocated from the Department of Justice and Constitutional Development, for the Commission of Inquiry into State Capture to finalise its investigations and produce a close-out report. 

 

1. The Committee notes thework being done, including coordination between different departments, to address the various sources of illicit financial flows. However, the Committee remains concerned about the slow progress in addressing this issue; especially given the current state of the economy, whererecovery of such funds is crucial to bolster government revenues.

 

1. The Committee notes with concern that only 8 percent of the available funds in the bank loan guarantee scheme has been dispensed to date; with no tangible additional measures in place to address the challenges and enhance the disbursement offunds, in order to avert job losses and the closing down of businesses. The Committee is further concerned that developmental finance institutions (DFIs) are not involved in disbursing such loans.

 

1. The Committee noted the concerns raised in the submissions by civil society organisations regarding the need for the National Treasury to improve public participation with respect to the implementation of zero-based budgeting and other programmes; as well as to ensurethat it receives feedback from society on whether or not the programmesbudgeted for, are effective.

 

1. The Committee notes that the Department of Public Service and Administration will reprioritise funds for personnel expenditure reviews in national, provincial and local government, in order to ensure better management of a sustainable wage billin future.

 

1. Whilst the Committee advised civil society organisationsto also engage with sector departments and the relevant parliamentary portfolio committees on sector-specific issues; the Committee is concerned over the 3.2 million children who arereportedly not able to access any form of early childhood development (ECD)programme, as well as the high percentage of children who attend unregulated and unregistered ECD programmes. The Committee also notes that the Center for Early Childhood Development has sent numerous correspondences to the Department of Social Development regarding this matter, with no response from the Department. 

 

 

 

6. Recommendations

 

The Select Committee on Appropriations, having been briefed and engaged with the above stakeholders on the Second Adjustments Appropriation Bill [B25 - 2020], recommends as follows:

 

1. The Minister of Finance should approve the overall roll-over amount of R1.6 billion provided for in the Bill for the 2020/21 Second Adjustments Appropriation Bill, as well as virements exceeding 8 percent, in accordance with the Public Finance Management Act (PFMA) prescripts and ensure that only projects near completion are approved to prevent fiscal dumping, a March spike or under-expenditure by the end of March 2021. 

 

1. The Ministers of Finance; Social Development; Health; Agriculture, Land Reform and Rural Development; Environment, Forestry and Fisheries; Sport, Arts and Culture and Transport should ensure that proper financial management systems,as defined by chapter 5, section 38 of the PFMA and Treasury Regulations, are put in place for the effective use of the R19.6 billion set aside in the 2020 Special Adjustments Budget to address the impact of COVID-19 in various sectors with different interventions including job creation, food relief and social relief of distress. Where non-compliance persists, consequence management mechanisms, as required by chapter 10, section 81 of the PFMA, Treasury Regulations and other applicable legal prescripts, must be implemented without delay. 

 

1. The Minister of Finance should approve the following in-year spending adjustments: R23 billion for Eskom; R6.5 billion for the South African Airways (SAA) to settle its guaranteed debt and interest;R84.7 million for the Independent Communication Authority of South Africa (ICASA) for licensing the high-demand spectrum; as well as reductions in the amount of R36.5 billion from compensation of employees as a result of the salary freeze. Furthermore, the Minister of Finance should ensure that National Treasury submits a detailed report and conditions to the Committee, before the 2021 Budget is tabled, regarding the use of the R10.5 billion allocation earmarked for the SAA business rescue plan. Government should expedite the establishment of the proposed Presidential State-Owned Enterprises (SOE) Council, to provide strategic oversight of SOEs and ensure that their dependence on the fiscus is reduced by addressing their financial, operational, business and funding models.

 

1. The Ministers of Finance and Health should ensure that funds are made available to build the requisite capacity to implement the National Health Insurance (NHI),given the effects of COVID-19; and this should form part of the efforts to ensure that, over the medium term, greater efficiency and reprioritisation is achieved to protect service delivery in areas such as primary healthcare, immunisation, and HIV prevention and treatment.

 

1. The Ministers of Finance and Tourism should ensure that adequate capacity is developed and proper financial management systems are put in place, as required by section 38 of the PFMA, Treasury Regulations and other applicable prescripts, for effective use of the R540 million set aside for a tourism equity fund to support black-owned and commercially viable enterprises to acquire shares in tourism enterprises. This should include the short-term tourism relief fund, extended to mid-2021, which aims to assist eligible small, medium and micro-enterprises with working capital. The tourism industry is one of the sectors that contributes significantly to the South African economy and therefore, it is important to unlock it.  

 

1. The Ministers of Finance and Police should ensure that the factors that led to delays in the procurement and delivery of PPEs in the South African Police Service are investigated and addressed, to avoid similar challenges being encountered in future procurements projects, especially given the high risk posed by COVID-19.   

 

1. Given the gradually increasing costs of the Commission of Inquiry into State Capture, which requires government to move funds from other programmes to ensure that investigations are conducted, the Ministers of Finance and Justice and Constitutional Development should ensure that proper planning and budgeting is done for the Commission to conduct its investigations without fear or favour and to conclude its work as soon as possible.

 

1. Whilst the Committee acknowledges that the issue of illicit financial flows is the responsibility of National Treasury and the South African Revenue Service (SARS), it recommends that National Treasury,together with other affected organs of state, expedite the work that is being done to address this issue, as the country needs the funds being lost through illicit financial flows more than ever before. Repeated parliamentary committee reports have made numerous recommendationswith regard to this issue, and Parliament will continue to monitor progress in this regard.

 

1. The Minister of Finance, together with Cabinet, should take drastic steps to ensure that challenges encountered withthe disbursement of funds in the bank loan guarantee scheme, as part of unlocking the private sector to bolster economic recovery, are addressed; and that South African developmental finance institutions (DFIs) are also considered forparticipation in the scheme without crowding out the private sector. Parliament will continue to monitor progress in this regard.

 

1. The National Treasury should improve its public participation programmes and feedback mechanisms with regard to zero-based budgeting and other critical programmes, to ensure that civil society organisations’ submissions are taken into consideration. Furthermore, National Treasury should furnish Parliament with more details on how zero-based budgeting will be operationalised and what effect it will have on the current budget cycle.

 

1. Whilst the Committee agrees with the need to stabilise the public sector wage bill, government should ensure that the salary freeze does not result in a public sector brain drain, with critical government positions not attracting the required scarce skills and expertise needed to deliver quality services to the people.The Committee also encourages both government and public sector unions to address all matters related to wage negotiations in the Public Service Co-ordinating Bargaining Council (PSCBC).

 

1. The National Treasury and the Department of Social Development should ensure that adequate responses are provided to any correspondence from civil society organisationsregarding sectoral issues; and expedite the process of migrating the early childhood development (ECD) programme from Social Development to the Department of Basic Education. The Minister of Social Development should ensure that illegal and unregistered ECD programmes are investigated and the necessary remedial actions taken, without compromising ECD services. 

 

1. The National Treasury should commit to more engagement with departments affected by in-year spending adjustments; and should be required to report on the consultations conducted before the Committee processes budgets. The limited available time to interact with stakeholders when processing budgets should be addressed by the administrative and political leadership of Parliament. Chairpersons of parliamentary committees should engage each other to determine how the work ofcommittees can contribute more effectivelyto the process.

 

1. Conclusion

 

After having complied with section 12 of the Money Bills and Related Matters Act No 9 of 2009 (as amended), the Select Committee on Appropriations, having considered the Second Adjustments Appropriation Bill [B25 – 2020], referred to it, and classified by the Joint Tagging Mechanism as a section 77 Bill, reports that it has agreed to the Bill, without proposed amendments.  

 

The Democratic Alliance (DA), the Economic Freedom Fighters (EFF) and the Freedom Front Plus (FF+) objected to the Bill and the Report.

 

Report to be considered.