ATC241210: Report of the Select Committee on Appropriations on the Special Appropriation Bill [B19 – 2024] [National Assembly (Section 77)], Dated 10 December 2024

NCOP Appropriations

REPORT OF THE SELECT COMMITTEE ON APPROPRIATIONS ON THE SPECIAL APPROPRIATION BILL [B19 – 2024] [NATIONAL ASSEMBLY (SECTION 77)], DATED 10 DECEMBER 2024

 

The Select Committee on Appropriations, having considered the Special Appropriation Bill [B19 – 2024] (National Assembly – section 77), referred to it in terms of section 12 (15) of the Money Bills and Related Matters Act No. 9 of 2009 (as amended by the Money Bills Amendments Procedure and Related Matters Act, No. 13 of 2018) (the Money Bills Act), reports as follows:

 

1. Introduction

Section 213(2) of the Constitution of the Republic of South Africa provides that money may be withdrawn from the National Revenue Fund (NRF) only in terms of an appropriation by an Act of Parliament. The Special Appropriation Bill [B19 - 2024] was tabled by the Minister of Finance on 30 October 2024, during the tabling of the 2024 Medium Term Budget Policy Statement (MTBPS) and was referred to the National Council of Provinces and the Committee, for concurrence, on 05 December 2024, after it was passed by the National Assembly.

 

2. Public participation and consultation

To facilitate public participation and involvement, and in compliance with section 72 of the Constitution of the Republic of South Africa, emails were sent directly to all the stakeholders from the Committee’s database, inviting them to comment on the Bill. This Bill had not been included in the newspaper advertisements calling for public comments on the other pieces of legislation tabled as part of the MTBPS as, until the tabling on 30 October 2024, there had been no indication that there would be a special appropriation. Subsequently, in addition to receiving a briefing from National Treasury on the contents of the Bill and consulting with the Financial and Fiscal Commission (FFC) and the Parliamentary Budget Office (PBO), the Committee received written submissions from the Congress of South African Trade Unions (COSATU) and the Organisation Undoing Tax Abuse (OUTA). COSATU also made an oral submission during a public hearing on 06 December 2024.

 

 

 

3. National Treasury briefing

National Treasury reported that the Bill proposed the following additional funding allocations in the 2024/25 financial year:

• R5 billion to the Department of Transport for the Gauteng Freeway Improvement Project (GFIP) debt redemption. R3.8 billion will come from Gauteng Province and the national government will contribute R1.2 billion.

• R95.5 million for the legal proceedings against Israel in the International Court of Justice (R38.2 million to the Department of Justice and Constitutional Development; R40 million to the Department of International Relations; and R17.4 million to the Presidency).

4. Stakeholder submissions

4.1 Financial and Fiscal Commission (FFC)

The Financial and Fiscal Commission (FFC) acknowledged the R5 billion directed to the Transport Vote for SANRAL to address debt repayment associated with the GFIP and advised that future projects should undergo rigorous feasibility studies. Regarding the special appropriation of R95.5 million to the Presidency, International Relations and Cooperation and Justice and Constitutional Development Votes in respect of costs associated with South Africa’s case against Israel at the International Court of Justice (ICJ), the FFC encouraged government to pursue partnerships with other nations to more equitably distribute the cost burdens associated with promoting global peace.

 

4.2 Parliamentary Budget Office (PBO)

The Parliamentary Budget Office (PBO) explained that the funding to Vote 1: the Presidency, Vote 6: International Relations and Cooperation, and Vote 25: Justice and Constitutional Development was needed for the case at the ICJ, where South Africa was accusing Isreal of violating the Convention on the Prevention and Punishment of the Crime of Genocide in its military assault on Gaza.

 

4.3 Congress of South African Trade Unions (COSATU)

The Congress of South African Trade Unions (COSATU) welcomed the Bill; in particular, its allocation of an additional R38 million to the Department of Justice and Constitutional Development to fund the International Court of Justice case in defence of the inalienable rights of the Palestinian people to be protected from genocide. It further applauded the proposed appropriation of R5 billion for the settlement of the GFIP e-toll debt. COSATU viewed this as a welcomed intervention by government in response to the public and COSATU’s outcry against e-tolls.

 

4.4 Organisation Undoing Tax Abuse (OUTA)

The Organisation Undoing Tax Abuse (OUTA) submitted that, while the MTBPS recorded this Bill as being for the repayment of SANRAL’s debt relating to the Gauteng Freeway Improvement Project (GFIP), it was actually for SANRAL debt redemption and constituted a bailout. OUTA further submitted that the R5.021 billion appropriated was comprised of R1.2 billion from national government and R3.8 billion from the Gauteng provincial government, with the Gauteng share including R546 million for a maintenance backlog. OUTA questioned why the Gauteng contribution for maintenance was being used towards debt repayment. OUTA also asked what conditions National Treasury had attached to this bailout and why these were not made public.

 

 5. Observations and findings

The Select Committee on Appropriations, having considered the above inputs on the Special Appropriation Bill [B19 - 2024], made the following findings:

5.1 Whilst the Committee welcomed the intervention to address the Gauteng Freeway Improvement Project (GFP) issues, it agreed with the Financial and Fiscal Commission’s view around the need for future projects to undergo rigorous feasibility studies and a proper evaluation exercise and impact assessment studies (both socially and economically), including a proper public participation process. The Committee noted the R5 billion allocated to the Department of Transport for the GFIP debt redemption. It also noted that R3.8 billion would come from the Gauteng Province while national government would contribute R1.2 billion.  

5.2 The Committee noted the additional R95.5 million for the legal proceedings against Israel in the International Court of Justice, consisting of R38.2 million to the Department of Justice and Constitutional Development; R40 million to the Department of International Relations and Cooperation; and R17.4 million to the Presidency.

 

6. Recommendations

The Select Committee on Appropriations, having been briefed and engaged with the above stakeholders on the Special Appropriation Bill [B19 - 2024], recommends as follows:

 

6.1 The Minister of Finance should approve and gazette the Special Appropriation Bill [B19 – 2024] and the National Treasury, together with the Department of Transport, should ensure that the allocation earmarked for the Gauteng Freeway Improvement Project (GFIP) debt redemption is used effectively and efficiently for the intended purpose, and if there are any conditions for the allocation as suggested by the Organisation Undoing Tax Abuse (OUTA), the National Treasury should follow the due and proper process to publish those conditions to promote budget transparency as enshrined in the Constitution.

6.2 The National Treasury should ensure that any future infrastructure projects implemented by government departments are properly planned, with a proper evaluation exercise, and undergo rigorous public participation, social and economic feasibility studies and the necessary due diligence and scrutiny to avoid similar challenges.

 

6.3 The Committee reiterates its previous recommendation made during the 6th Parliament that it does not encourage the introduction of special appropriation bills unless absolutely necessary and there are exceptional circumstances that dictate this; as this may signal budgeting challenges. When such bills are introduced, it needs to be done timeously, so that Parliament has sufficient time to satisfy itself, engage with the public meaningfully, and process them accordingly to ensure full compliance.  

 

7.    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 Special Appropriation Bill [B19 - 2024], referred to it for concurrence, and classified by the Joint Tagging Mechanism as a section 77 Bill, reports that it has agreed to the Bill, without proposed amendments.  

 

The Umkhonto we Sizwe Party (MKP) rejected the Report.

 

Report to be considered.