FINANCIAL MANAGEMENT OF PARLIAMENT ACT: Review process November 2012

Background Resolution of the National Assembly, 20 September 2012 Notes technical challenges with implementation of certain provisions of the Act. Instructs Standing Committee on Finance to review Act with a view to introducing amending legislation if necessary. Evaluate application of Act, including those provisions relating to authority of provinces to enact such legislation and timeframes associated with various reporting mechanisms; Take account of work of Speaker’s Forum; and Report to Assembly by 22 November 2012.

Summary of proposed amendments Oversight mechanism – section 4 Application to provincial legislatures – ConCourt judgment Adjustments budget procedure iro own funds – section 17 Tabling of annual report – sections 59, 60 & 62

Oversight mechanism – section 4 Proposed amendment to allow governance structures in place to fulfill the role of oversight mechanism Amendment to remove restriction on membership of Executive Authority and deputies so that POA can fulfill the functions of the oversight mechanism. Effect would be to allow any member to be part of oversight mechanism, subject to Joint Rules. Governance issues relevant to functions of oversight mechanism and participation of EO addressed in Schedule 2 to Act and the Joint Rules. Oversight mechanism must be open to public as any other committee.

Application to provincial legislatures Implementation of Order of Constitutional Court – Premier: Limpopo Province v Speaker of Limpopo Provincial Legislature A provincial legislature is competent to legislate its own financial management only if this has been expressly assigned to it by national legislation – FMPA not doing this. Speaker’s Forum decision to include provincial legislatures in FMPA. Proposed amendment - omitting ineffective sections and inserting a section to make provisions applicable to provincial legislatures similar to Powers, Privileges and Immunities of Parliament and Provincial Legislatures Act Parliament must report to ConCourt by 9 September 2013

Adjustments budget procedure iro own funds – section 17 Concerns raised by officials for a procedure to deal with own funds in the adjustments budget process Proposed amendment to include a procedure as was in the Bill – removed due to section 4 being incompatible with POA Amendment of section 4 would open opportunity to deal with procedure in the POA, as oversight mechanism

Tabling of annual report Proposed amendment to allow more time for consideration of annual report by Executive Authority Section 59 – AO must submit the annual report to the EA so that the latter can table it in Parliament within 5 months of the financial year end. Section 60 – EA must table annual report within 5 days of receiving it. PFMA allows AO of a department to submit the annual report to the EA within 5 months of financial year end (s. 40(1)(d)) and the EO to submit to Parliament within 1 month of after AO received the audit report (s. 65(1)(a)). Amendment to sections 59, 60 and 62 to make FMPA similar to PFMA.

Conclusion SC on Finance to receive briefing on 13 November 2012 Amendment Bill will be drafted by CLSO, unless Committee decides otherwise Process allows opportunity for officials to a address challenges in the Act Process must be public, as any other legislative process in the National Assembly