MPs worry about bypassing parliament
MPs are worried that the raft of measures introduced by the Cabinet to tackle the Covid-19 pandemic are bypassing parliamentary oversight, reducing the legislature to rubber-stamping the decisions of the executive.
MPs are worried that the raft of measures introduced by the Cabinet to tackle the Covid-19 pandemic are bypassing parliamentary oversight, reducing the legislature to rubber-stamping the decisions of the executive.
The MPs’ concern highlights the problem of how the executive can deal expeditiously with a disaster while recognising the role of parliament to exercise oversight of the executive. This problem was more acute when parliament was in recess and before it started holding virtual committee meetings, which got under way this week.
The issue was raised during a joint virtual meeting on Thursday of the standing and select committees of finance, which were briefed by Treasury officials on draft tax relief bills related to the management of the disaster — the draft Disaster Management Tax Relief Bill and the draft Disaster Management Tax Relief Administration Bill.
These bills, which took effect from April 1, will have to be updated to include the latest tax measures announced by President Cyril Ramaphosa on Tuesday.
EFF MP Floyd Shivambu objected to the tax measures being announced and implemented before parliament was able to deliberate and pass laws on them. He said parliament is merely acting as a rubber stamp for what is a fait accompli.
“The passing of legislation is a privilege of parliament, including these tax and money bills being presented here. It is exclusively the right of parliament to process them, but the president has already announced on the majority of things that are being presented here. We are just being asked to rubber-stamp what has been announced,” Shivambu said. “Even amid a crisis, we have not dissolved parliament. Parliament should continue to play the constitutional role assigned to play.”
DA finance spokesperson Geordin Hill-Lewis also wanted to know how the tax measures could be implemented before the bills were passed by parliament, saying this is an “extraordinary” situation.
Treasury deputy directorgeneral Ismail Momoniat agreed that some of the tax measures in the draft bills had already taken effect. “This does happen with many tax proposals. This is not a new practice.” He pointed out, for example, the changes in the income tax rates announced in the annual national budget and which took effect before parliament had approved them. The same applied to the hike in the VAT rate.
The risk of this procedure, Momoniat said, is that parliament still has the power to veto these changes after they have been implemented.
He noted that no-one knows how long the Covid-19 crisis will continue and it is necessary to make adjustments to tax measures as the situation develops.
Select committee chair Yunus Carrim referred to a previous legal opinion obtained that found there was no way round this retrospective legislative process, which happens in many other democracies.
The system has been in operation since 1994, but has become more pronounced in the Covid-19 crisis as the scope of bills being implemented without the approval of parliament is becoming wider.
However, Carrim insisted that parliament will not forgo its oversight role in this situation and will continue to seek public participation as far as possible.
Parliamentary legal adviser Frank Jenkins said the law and constitution allows for such a process and is in line with international practice. “There is nothing unconstitutional about retrospective legislation unless it creates criminal offences.”