Chairperson, Ministers of Finance and Transport, the crucial question for us today is the recognition that Africa and South Africa, in particular, has earned from the international community.
In the annual international survey of 2005, Gallop International declares that even though Africa is not the richest continent, it is nevertheless staunchly optimistic about its future. Africa has good reason to be cheerful. The economy of the continent has been performing appreciably well, with South Africa having experienced spectacular growth over the past few years.
Some of Africa's long-running conflicts, such as the war in the Democratic Republic of Congo, have ended. Significantly, in the person of Ellen Johnson-Sirleaf, Liberia has given Africa its first female head of state. Other commentators argue that although South Africa inherited a huge load of trouble from the disintegrating apartheid government, the ANC government has developed policies that have driven an impressive 90 straight months of growth in every aspect of life.
Since early 2000, the fiscus began to move into a more expansionary phase. This means that, in the first instance, there is more money for the programme of social grants, mainly for child support and pensions destined to go to about 10 million indigent people in a population of 47 million. According to our government, this is a modern-day Keynesian practice with a measure of Roosevelt's New Deal.
The government has voted R370 billion over the next three years. This will be devoted to Public Works, mainly infrastructure, to boost jobs, and create more demand that will spread more evenly. The government's longer- term aim is to raise the growth rate to 6% by 2010, and to halve unemployment and poverty by the year 2014.
International commentators such as The Economist have argued that our government has been refreshingly pragmatic in experimenting with a mix of solutions in different sectors of the economy. In a vital sense, therefore, the ANC is not an ordinary party. It faces no serious competition.
The economic intelligence unit were accused that with a budget deficit of this size, South Africa would easily be able to fund it with a mixture of foreign and domestic debt. More revealing, however, is the study carried out in December 2005 by the World Bank and our Department of Trade and Industry. Eight hundred private companies were asked about the investment climate in South Africa. The answer they gave was encouraging. When compared not only to African countries, but also economies like Malaysia, Brazil and Eastern Europe, South Africa looks good.
Firms say that local courts work well. Property rights are adequately protected. Power is relatively cheap. Tax rates are fairly low. Red tape is no worse than in other countries with similar per capita income. In addition, both South African firms surveyed find it easier to borrow. In any case, they do not have to call the bank that often. On average, they are more profitable than their counterparts in, say, Poland or Malaysia.
The early announcement of transfers by National Treasury to local government and municipalities is a fine demonstration of our continually evolving intergovernmental fiscal relations.
Other comparable countries have taken between 30 and 40 years to develop stable intergovernmental fiscal relations. South Africa's progress in this regard is most noteworthy.
With government finances now in order, the problem is not money, but the ability to spend. Many departments and municipalities underspent their investment budgets in South Africa because we have few qualified people to design and manage projects.
As elected representatives we have an overwhelming duty to focus not only on the national Budget, but also on the budgets of the nine provinces and the 283 municipalities. Elected representatives are expected to focus on outputs and outcomes to be delivered by all three spheres of government.
In order to provide the Freedom Charter with tangible legitimacy, members of this House must be committed to exercising their oversight responsibilities. The Select Committee on Finance will inspect intensely the following: the monthly reports of actual revenue and expenditure with regard to national revenue; quarterly reports of provincial treasuries; annual reports and strategic plans of national and provincial departments; reports of the Auditor-General and the media budgetary assessment reports of municipalities.
Moreover, an oversight responsibility calls for an examination of performance against measurable objectives. Reports submitted by departments and municipalities must not leave information to the imagination of the reader. Reports should provide details such as project names, location, type of structure, number of units, project duration, completion date and project costs.
The monitoring process adopted by departments and municipalities will also be interrogated. Raising questions and tabling of discussions on matters of importance in the NCOP are effective mechanisms for enhancing parliamentary democracy and for exercising oversight responsibilities.
Parliamentary questions are important instruments for monitoring the performance of national, provincial and municipal structures, and for providing an essential check on the activities of the various spheres of government.
It is expected of the NCOP members to employ this method of engaging national departments, provincial departments and municipalities. Questions are not arbitrarily selected by members, but must essentially dovetail with the oversight functions of the select committees.
Last year, 42 questions relating to provincial grants were submitted to eight national departments. The Select Committee on Finance prioritised the interrogation of provincial grants in terms of its key oversight functions. Through public hearings in the NCOP and the use of questions and replies in the NCOP and the legislatures, members ensure that regular inspection of budgets and expenditure occurs.
This active monitoring of budgets and expenditure at regular intervals would timeously assist in detecting expenditure that is at variance with approved plans of national and provincial departments and municipalities. Regular inspection of expenditure against an approved budget is essential to detect, for example, whether expenditure exceeded any approved limits.
This implies that national departments, provincial departments and municipalities must manage and adhere to the budgets. Any excess expenditure must be reported, and the necessary approval must be obtained to ascertain that such excesses are permissible. The reasons for the excess expenditure are extremely important, and must be included in motivations. The premise that no expenditure may be incurred unless budgeted for or unless necessary approval has been obtained still holds sway.
The Select Committee on Finance once again places on record its congratulations to the National Treasury of South Africa for fulfilling with distinction not only its constitutional responsibility, but also its mandate. The Select Committee on Finance recommends that the House approve the 2006 Appropriation Bill. [Applause.]
Debate concluded.
Bill agreed to in accordance with section 75 of the Constitution.