Parliament, Wednesday 8 July 2020 – The National Assembly (NA) and the National Council of Provinces (NCOP), at separate plenary sittings today, agreed to the 2020 Revised Fiscal Framework.
This follows recommendations for its adoption from the NA’s Standing Committee on Finance and the NCOP’s Select Committee on Finance and means that Parliament will consider the supplementary 2020 Adjustments Budget.
The 2020 Revised Fiscal Framework includes revised estimates for the financial year ending 31 March 2021 on all revenue; all expenditure; and borrowing, interest and debt-service costs.
Minister of Finance Mr Tito Mboweni tabled the 2020 supplementary Budget in Parliament on 24 June, when he delivered the supplementary Budget Speech. The Public Finance Management Act, read together with the Money Bills Amendment Procedure and Related Matters Act, empowers the Minister of Finance to table an adjustments budget, when necessary. The COVID-19 pandemic and the economic downturn in the country made this necessary.
The Money Bills and Related Matters Act also requires the Minister of Finance to table a revised fiscal framework if there are changes to the framework. A revised fiscal framework must be referred to the NA’s Standing Committee on Finance and to the NCOP’s Select Committee on Finance for consideration and report.
The special 2020 Adjustments Budget brings an Adjustments Appropriation Bill and a Division of Revenue Amendment Bill to Parliament. It also formalises tax relief Bills aimed at giving effect to government’s COVID-19 response package and requires Parliament’s approval of these Bills. A second adjustments budget will be tabled in October, as usual, together with the Medium Term Budget Policy Statement.
The Standing and Select Committees on Finance’s reports detail their consideration of the special 2020 Revised Fiscal Framework.
On 25 June, there were briefings from Minister Mboweni and senior National Treasury officials and, on 30 June, from the Parliamentary Budget Office and the Financial and Fiscal Commission. On 1 July, the committees held joint public hearings. Inputs and submissions were received from the following organisations and individuals – the Congress of South African Trade Unions, the C19 People’s Coalition, Paul Hoffman of the Institute for Accountability in Southern Africa, the Organisation Undoing Tax Abuse, the Budget Justice Coalition, the Fiscal Cliff Study Group, the Economists Initiative, the South African Institute of Chartered Accountants, the Children’s Institute, the Civil Society, Professor Geoff Everingham, Mr Peter Meakin, Mr Aboobakar Mahomed Kharva and Mr Moses Moadira. On 3 July, the National Treasury responded to the inputs and submissions.
While recommending approval of the 2020 Revised Fiscal Framework, in their written reports, the Standing and Select Committees on Finance made a wide range of observations and recommendations. These included the need for greater clarity on infrastructure development projects, which were crucial to economic recovery.
In their reports, the committees said they were: “Painfully aware of the severe financial constraints of the country, the extreme unpredictability of the COVID-19 circumstances domestically and globally and that the whole world, let alone our country, is in unchartered territory … and that all of us, whether in government, Parliament, business, trade unions or other sections of civil society need to work together like never before.”
You can read the committees’ reports in this official Parliament paper (Announcements, Tablings and Committee Reports of 7 July 2020), starting from page 4 https://www.parliament.gov.za/storage/app/media/Docs/atc/7c52085f-7f57-41ca-aa31-0e82a710a5c5.pdf
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