Chairperson, in terms of section 7(3) of the Money Bills Act and section 76(4) of the Constitution, the Division of Revenue Bill must be tabled in the National Assembly, after which it must be dealt with in accordance with the procedure established by section 76(1) of the Constitution.
In accordance with these sections, the Minister of Finance, Mr Pravin Gordhan, tabled the Division of Revenue Bill in the National Assembly on 26 February 2014. On 13 March 2014 the Bill was transmitted to the National Council of Provinces and referred to the committee, in accordance with section 76 of the Constitution.
Following a briefing by National Treasury on the Bill, the committee consulted the Financial and Fiscal Commission; the SA Local Government Association, Salga; the Parliamentary Budget Office and all nine provinces. The committee further conducted public hearings on 18 March 2014, in line with section 9(5)(b) of the Money Bills Act.
The committee found that the Bill was presented within a very sound fiscal policy guided by principles of countercyclicality, debt sustainability and intergovernmental fairness. A large part of the Bill remained the same. Revisions were mainly to take into account specific policy adjustments.
Expenditure in the Medium-Term Expenditure Framework, MTEF, remains within the bounds set out in the 2013 Budget, while revenue estimates for 2013-14 financial year presented in the 2014 Budget have been revised upwards by R1 billion due to unforeseen revenue collections.
With the exclusion of debt service costs and the contingency reserve, the allocated expenditure share between the three spheres amounted to R1,1 trillion, R1,2 trillion and R1,3 trillion over each of the MTEF years respectively. Despite the factoring in of the population movements in provincial equitable shares over the MTEF, nominal increases are reflected in the equitable share allocation of provinces when compared to last year's allocations.
There have been a number of changes made with regard to conditional grants that might require regular monitoring to assess their efficiency and effectiveness. Such changes are the introduction of new grants, additions and reductions of allocations to certain grants and a shift of grants from direct to indirect grants. Although the new local government equitable share formula imposed major changes on the allocations to some individual municipalities due to the updated Census 2011 data, the local government equitable share allocation increased within each year of the period under review. For the 2016 to 2017 period, the nominal rand value of the allocation will have more than doubled, from R23,8 billion in 2009 to 2010 to R52,9 billion.
For the period 2009-2010 to 2013-2014, the local government equitable share allocation grew at an average nominal rate of 14,2% and will grow by an average nominal rate of 9% over the 2014 to 2015 MTEF period.
The committee made some findings that might require further interaction with National Treasury during the Fifth Parliament. Some of these are the National Treasury revenue projections, expenditure ceiling measures, changes made to some conditional grants and the impact of various capacity- building grants over the past years, to date. The committee has deliberated on this and recommends that the Division of Revenue Bill be adopted without amendments.
In conclusion, I would like to take this opportunity to thank everyone for the support that we have received from all members of the Council, the leadership of the Council, all staff members and all the support staff members within our different committees. [Interjections.]
May I further conclude by saying that there is a time and season for everything under the sun. [Interjections.] There was time for us and it was indeed our season. We have made strides under our present leadership and we thank them for that. [Interjections.]
May I also wish every one of us who appears on the lists as a potential candidate for the Fifth Parliament well for the future. For those of us who do not yet appear on the lists, who are still waiting for further announcements ... [Laughter.] ... may I say to you, let your hearts not be troubled. [Laughter.] We are still together. May God bless you as you go out and may He also bless you as you come in. I thank you, Chair. [Interjections.] [Applause.]
Question put: That the Bill be agreed to.
IN FAVOUR: Eastern Cape, Free State, Gauteng, KwaZulu-Natal, Limpopo, Mpumalanga, Northern Cape, North West, Western Cape. Bill accordingly agreed to in accordance with section 65 of the Constitution.