The Minister of Finance, Mr Enoch Godongwana, will next week (Wednesday 21 October) deliver the Medium-Term Budget Policy Statement (MTBPS) in a sitting of the National Assembly, to outline the adjusted estimates of government expenditure.
The MTBPS is provided for in terms of section 28 of the Public Finance Management Act, 1999 (Act 1 of 1999), which requires National Treasury to annually table in the National Assembly multi-year budget projections for revenue and expenditure and key macro-economic projections. The MTBPS is part of South Africa’s Medium-Term Expenditure Framework (MTEF), which has introduced a longer planning horizon into the budget process.
It also provides an important opportunity for Parliament to assess how government intends to balance economic growth, service delivery and fiscal sustainability amid competing demands on the public purse. It also establishes government’s economic policy framework, updates economic forecasts, adjusts departmental budgets and authorises emergency spending.
The MTBPS also enables Parliament and the public to scrutinise the government’s finances through committee oversight over government departments. Parliamentary committees review effective and efficient departmental spending through the Budget Review and Recommendations Reports, which must be tabled in the National Assembly before the MTBPS reports are adopted.
An official Parliament statement says the MTBPS also plays a critical role in the budgetary process because it sets the tone for the fiscal framework for the next national budget and provides Parliament and the country with an update on how Treasury perceives the present economic situation.
In terms of rules and procedures of Parliament, the MTBPS is tabled three months before the national budget, in October every year after the BRRR. The national budget is tabled in February after the State of the Nation Address. After the tabling of the MTBPS, Parliament’s finance and appropriations committees must conduct public hearings with relevant stakeholders.
Also referred to as the “mini budget”, the MTBPS allows departments to apply for adjustments to their budgets and request additional funds for unforeseeable and unavoidable expenditure. It also indicates how government intends to adjust spending estimates and update the budget expenditure plans
The MTBPS also makes it possible for Parliament and the public to interact with the government’s budget plans, ahead of the national budget set for February. It is also a mechanism to review the effective and efficient use of available resources.
During the same sitting, the Minister of Finance will also table the Adjustments Appropriation Bill.
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