Treasury up there with best

IMF: ‘THERE’S ROOM FOR IMPROVEMENT’ Second-most transparent fiscal authority praised for its efforts.

National Treasury, in charge of managing the country’s finances, is the second-most transparent fiscal authority in the world, according to the International Monetary Fund (IMF) Fiscal Transparency Evaluation Report.

A team from IMF’s fiscal affairs department conducted a Fiscal Transparency Evaluation on request at the National Treasury between 11 and 25 July last year and found that it had many elements of sound fiscal transparency practices and made efforts to continue improving reporting practices over time, though there is room for improvement in fiscal reporting.

During the evaluation process, the IMF had extensive meetings with senior staff of Treasury, including deputy directors-general Edgar Sishi and Duncan Pieterse.

The IMF praised Treasury for its comprehensive, relevant, timely and reliable overview of the government’s financial position and performance.

According to the report on the evaluation, Treasury demonstrated consistent transparency in its reporting and maintained rigorous oversight of public finances, despite the serious governance issues around state capture and widespread corruption.

Working with the SA Reserve Bank, Treasury provided broad coverage of financial statistics and government’s debt levels.

In addition, the evaluation found that the auditor-general has remained independent and ensures that the government and its entities produce financial statements in line with international standards.

However, the IMF felt there is still room for improvement in fiscal reporting and transparency. The main issues were that financial statistics did not include the broader public sector, that differences in reports were not explained publicly and that there were gaps in the coverage of assets and liabilities.

The IMF also pointed out that Treasury tends to produce “overly optimistic gross domestic product (GDP) forecasts” that limit its ability to tackle the country’s rising debt burden.

In addition, the IMF suggested that government’s fiscal plans be scrutinised by independent institutions before release.

Treasury said work is underway to address these concerns.