Chairperson, hon Minister, hon members, special delegates, and ladies and gentlemen, it is an honour for me to take part in today's debate on the Division of Revenue Bill 2011. I stand here today to present to this House the report of the select committee on the Division of Revenue Bill, as announced and tabled yesterday, 11 April, for consideration.
Chairperson, in terms of the provisions of the Money Bills Amendment Procedure and Related Matters Act, Act 9 of 2009, the Select Committee on Appropriations has the power to consider and report on spending issues, amendments to the Division of Revenue Bill, Appropriation Bill, Supplementary Estimate and Adjustments Appropriation Bill, recommendations of the Financial and Fiscal Commission, reports on actual expenditure published by National Treasury and any other related matter set out in the Money Bills Amendment Procedure and Related Matters Act.
With the co-operation and involvement of the provinces and the public, the committee has executed this mandate despite constraints arising from the late tabling of the Budget in Parliament. Subsequent to the tabling of the Bill in the National Assembly on 23 February 2011 and its transmission to the National Council of Provinces on 10 March 2011, the committee was briefed by National Treasury and the process of consultation immediately ensued. The committee received oral and written submissions and inputs from the Financial and Fiscal Commission, the SA Local Government Association, Salga, the Department of Human Settlements, the Department of Health, the Department of Energy, the Department of Public Works, the Cape Bar Council, the Department of Co-operative Governance and Traditional Affairs, the Umtshezi Local Municipality, Mr Paul Theron and Mr Philip van Ryneveld.
I submit that inputs made by these parties enriched the work of the committee and will further help in the budgeting process. Special note should be taken of the fact that some departments and persons chose to make direct submissions to the National Treasury while the parliamentary processes were still under way. I wish to commend the National Treasury for redirecting such inputs to the committee, as any consideration of these inputs without the involvement of the committee could have been seen as undermining the established parliamentary procedures dealing with legislation. For this reason, the committee presented recommendations aimed at strengthening clause 14(3) of the Bill to avoid such tendencies and to avoid possible misinterpretation of the clause in its current form in future.
Equally, the committee is concerned about the use of clause 16 of the Bill, which deals with withholding the transfer of funds in situations where there is persistent material breach of measures established in section 216 of the Constitution. The current clause, as it stands, is purely administrative as it does not permit the Minister to take any decision in a situation where such withholding will cause disruptions of basic service delivery. I submit that the 2012 Division of Revenue Bill should be strengthened to make withholding an executive function, rather than an administrative function. Perhaps clause 23 of the 2001 Division of Revenue Bill can best address our concerns on this matter and I call on the Minister to consider it.
The 2011 Division of Revenue Bill provides for the phasing out of certain conditional grants - those that are believed to have met the objectives they were intended for - and further introduces new grants. These grants are introduced in order to align planning and implementation with sector needs and to reduce persistent backlogs in the eradication of inappropriate school infrastructure and the provision of water, sanitation and electricity at schools, as well as the improvement of informal settlements. We support all these measures and will continue to conduct oversight to ensure that the implementation thereof is realised.
While we support the views of the provinces on the need to continue discussions on the equitable share formula, we equally remain concerned about poor spending patterns by most provinces, particularly on conditional grants. It is a reality that most provinces still experience structural problems created by the apartheid regime of Bantustans, with, of course, the exclusion of Gauteng and Western Cape. These provinces were left with structural defects, crippled by huge backlogs, poverty, underdevelopment and without enough resources and capacity. In the spirit of intergovernmental relations, we plead with all departments to assist in bridging these challenges. If these challenges are not urgently and drastically addressed, the problem of under-spending and/or overspending will persist.
While the Western Cape continues to be cited as a shining example of clean governance, improved services and clean audit results, ignoring the fact that its problems and challenges are different from those of other provinces would be a huge mistake. The Western Cape had it nice even during the apartheid period. We should not lose sight of the reality that even the much-talked-about quality services provided in this province are delivered only to the very same people who were previously advantaged.