Civil society , Budget Process, Protection

By Linda Ensor

24 November 2017

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Civil society organisations have expressed concern about the integrity of the budget process and called on Parliament to ensure it is not undermined.

The organisations that have united in their stand to protect the budget process include the Public Service Accountability Monitor at Rhodes University, the University of Johannesburg, the Heinrich Böll Foundation, the Rural Health Advocacy Project and the Southern Africa Labour and Development Unit.

They have been joined by academics and social activists in calling on Parliament to probe the circumstances behind the growing number of senior officials who have resigned from Treasury and to show its support for credible and sustainable budget processes.

The organisations have also called on the Presidency to reaffirm the central, legislated role the Treasury plays in the budget process and commit to subjecting all major policy proposals, such as funding for higher education, to the rigour and consultation required of this process.

Their calls dovetail with the push by DA finance spokesman David Maynier to have Parliament’s finance committee hold a public hearing on the budget process including the roles of the finance ministry and the presidential fiscal committee and the factors that led to the resignation of the head of Treasury’s budget office, Michael Sachs, earlier in November.

Maynier fears that decision making about budget priorities, and the budget itself, has now been centralised under President Jacob Zuma and that the decisions of the presidential fiscal committee will undermine Finance Minister Malusi Gigaba’s committee on the budget.

The influence of the Treasury over the budget was declining, he said.

The concerns stem from the central role given to the Department of Planning, Monitoring and Evaluation in determining the government’s spending priorities, which is seen as usurping the role of the Treasury. Also worrying has been the reported R40bn proposal by the Presidency for free higher education.

“Undermining of the budget process and National Treasury threatens the stability of public finances and critical areas of government spending,” the organisations said.

“Importantly, and irrespective of the merits and criticisms of budget allocations, Treasury has followed a specified procedure in the implementation of the budget, which includes ensuring that the budget is spent as planned and holding departments to account when it is not,” said the group.

“Diverting budget allocations outside of the established processes opens the gate for arbitrary and irregular reallocations in the future.”

Chairman of Parliament’s finance committee Yunus Carrim said the committee was happy to engage with civil society organisations on the budget process. He believed there was nothing wrong in the Presidency determining budget priorities in terms of the medium-term strategic framework and the National Development Plan.

“Plans have to shape budgets. While this approach by the government is correct, it can’t be abused and has to be effected in ways that ensure that the constitutional and legislative role of National Treasury in the budgeting process is adhered to, and that there is full accountability to Parliament and the public.”

Carrim said Planning, Monitoring and Evaluation Minister Jeff Radebe had told the finance committee the government was considering introducing a law on the budget process to ensure it was open and transparent. “Public involvement in this new process might also be included in the legislation,” Carrim said.

EFF chief whip Floyd Shivambu said he did not mind whether budget decisions were taken by the Presidency or the Treasury. The ultimate outcome would be the same.

“Our major interest is what gets prioritised and whether the state has the capacity to generate enough revenue to cover its basic obligations. The state must shift its focus onto nontax revenue in the context of declining tax revenues. It was not as if we were appreciative of the Treasury’s role anyway.”