July 2005 Department Expenditure Report: discussion postponement; Chairperson Election

Meeting report

JOINT BUDGET COMMITTEE
14 September 2005
JULY 2005 DEPARTMENT EXPENDITURE REPORT: DISCUSSION POSTPONEMENT; CHAIRPERSON ELECTION

Joint Chairpersons: Ms L Mabe (NA; ANC) and Mr B Mkhaliphi (NCOP; ANC, Mpumalanga)

Documents handed out:
Committee Report on Departmental Expenditure Report for July 2005: Draft 1

SUMMARY
The Committee elected Ms L Mabe (ANC) to replace Mr N Nene (ANC) as its new Joint Chairperson.

The Committee decided to delay further consideration and approval of the Draft Expenditure Report for July 2005, since it had not had sufficient time to consider the content of the report in depth. Members expressed their displeasure at the length of time it had taken to receive the report. Certain Members also felt that the content of the report was of little use, since it did not include key performance indicators and operational plans for each department.

MINUTES

Joint Chairperson election
As Mr N Nene (ANC) was to replace Dr R Davies (ANC) as Chairperson of the Finance Portfolio Committee, he could no longer serve as a Joint Chairperson of this Committee. Mr S Asiya (ANC) proposed Ms L Mabe (ANC) for election to the position. She was elected unopposed.

Draft Expenditure Report for July 2005
Mr B Mkhaliphi (ANC, Mpumalanga) felt that the Committee could not discuss the draft report in a meaningful way, since the document had only been distributed to the Committee at the meeting.

Mr B Mnguni (ANC) said that a benchmark was needed to ascertain whether departments were overspending or underspending. Noting that July was the fourth month of the financial year, Mr Mguni pointed out that even the highest spending department for July, the Department of Agriculture, had only spent 38% of its overall budget.

Mr Y Bhamjee (ANC) said that the Committee should know why the report was tabled late.

Ms Mabe suggested that the Office of the Auditor-General (AG) be requested to send a junior official to attend Committee meetings so that such issues could be taken up by the AG as soon as they arise.

Mr Bhamjee responded that the AG had a Parliamentary Liaison Officer (PLO) and there was no reason why this person could not be present at all the Committee’s meetings. He said that this was only one example of a resource of which that the Committee did not make maximum use. Mr Bhamjee felt that the Committee should investigate why the AG's PLO was not present in the first place.

The Committee’s researcher explained that the Monthly Expenditure reports were normally received at the end of the following month. Therefore, the July report only became available at the end of August. The Departments were required to forward their respective monthly reports to National Treasury within two weeks after the end of the month. Treasury, then, took another two weeks to synthesise all the information.

Mr Bhamjee said that the way in which the report was presented was not meaningful. Monthly Expenditure Reports should include the key performance indicators for each of the Departments, so that the Committee could assess whether they were spending in accordance with their respective strategic plans or not. He requested the Joint Chairpersons to put this request to National Treasury. Ms J Fubbs (ANC), Mr T Ralane (ANC, Free State) and Ms B Dambuza (ANC) agreed.

Mr Asiya said that representatives of the relevant Portfolio Committees should be present when the Monthly Expenditure Reports were considered. The Portfolio Committees, he argued, would be more familiar with the strategic and operational plans, and the key performance indicators for the Departments which they oversee. Proper oversight by the Portfolio Committees, in the first place, would mean less risk of oversight omissions by the Joint Budget Committee, and decrease the need for hearings before the Standing Committee on Public Accounts.

Mr Ralane agreed that collaboration with the sector committees of Parliament should be strengthened.

Mr Mkhaliphi said that as per the Committee’s strategic plan it should be kept in mind that while collaboration with sector committees could be beneficial, it (the Committee) should contain such engagement to budgetary affairs only.

Mr Bhamjee said that all Members of Parliament had a responsibility to oversee the budget. The Committee had to engage constructively and build rapport with the sector Committees in order to achieve this.

Mr Asiya suggested that the Committee adopt its strategic plan as a working document. Ms Fubbs asked whether Mr Asiya made this suggestion on any substantive basis, or whether the standing principles just had to be fleshed out a bit more.

Mr Mguni asked the Joint Chairperson to redirect the discussion back to the intended subject, which was the consideration of the Draft Monthly Expenditure Report.

Mr Mkhaliphi stated that the Committee’s strategic plan had already been adopted long before.

Ms Fubbs suggested that the National Treasury and either particular or all the Departments be asked to appear before the Committee with their Strategic Plans linked to their Operational Plans.

Mr Ralane stated that the reports were not totally without value as they facilitated month-to-month and quarterly comparisons. In addition, there could also be consolidated quarterly reports. He said that the Committee was still acting within its own terms of reference, but did need to find more efficient ways in engaging and processing all the information it receives. He added that when Departments were asked to appear before the Committee, they should do so in order of the priority given to the services that they deliver.

Dr P Rabie (DA) noted that government Communications and Information Services (GCIS) had spent only 34% of their annual budget thus far. Given that the GCIS had a history of under spending he asked whether this should not be cause for immediate concern.

Mr Bhamjee responded to Dr Rabie’s concern with doubt, saying that it was difficult to assess whether the GCIS was indeed under spending in this financial year, as one had no indication of its key performance indicators.

Ms Dambuza noted that the Department of Provincial and Local government was still one of the lowest spenders for July 2004 with 0.85% of its total budget and an average expenditure of 13.92%. She added that it was one of the departments that had not complied with the request for submission of their monthly cash flow projections. She emphasised the importance of the cash flow projections in assessing expenditure reports and the importance of the Department of Provincial and Local Government in service delivery.

Mr Mguni emphasised the purpose of the Monthly Expenditure Reports as concise summaries that guided the Committee in deciding which departments to target for further engagement and information such as operational plans. He stated that Members had access such as departmental strategic plans and key performance indicators already and should not expect that it would be included in the Monthly Expenditure Reports, as the latter was compiled by the National Treasury.

Mr Asiya proposed that the Monthly Expenditure Report rather be discussed at a meeting scheduled for the 12 October, by which time Members would have had enough time to peruse the document carefully and to obtain the necessary information.

The proposition was accepted unopposed.

The meeting was adjourned.