Parliament’s Budget Office - Ensuring that parliament holds government accountable
The Parliamentary Budget Office (PBO) was established to improve Parliament’s oversight over the executive. Insession writer, Mava Lukani spoke to the recently appointed Director of the PBO, Dr Dumisani Jantjies.
Government departments appear before the relevant committees of Parliament to present their annual performance plans and budgets for the financial year. Which constitutional principles and legislation govern that process?
Dr Jantyis: Chapter 5 of the Constitution sets out the accountability framework for the executive. In particular, section 92 sets out accountability and responsibilities that Ministers and Cabinet individually and collectively are accountable to Parliament for the exercise of their powers and the performance of their functions. According to the Constitution and the Money Bills and Related Matters Act of 2009, Parliament allocates budgets to government functions through the Appropriation Bill. In their budget speeches, Minsters are expected to set out political outcomes for their functions of government (votes), and Parliament has to use these agreed political outcomes to hold the Ministers and Cabinet to account during their performance of their duties.
The Public Financial Management Act of 1999 and the Money Bills and Related Matters Act of 2009 set out clear mechanisms from which Parliament may hold government accountable in realising their political outcomes. The process is initiated through the Medium Term Budget Policy Statement (MTBPS), where the government clearly sets out its medium-term spending priorities.
It is these priorities, together with the economic context and other budget assumptions, that set the context for government departments to prepare their budget votes to be presented in Parliament prior to spending the budget allocated in terms of the Appropriation Bill – although the Money Bills and Related Matters Act of 2009 does allow departments to spend a certain percentage of the budget allocated before an Appropriation Bill is adopted in Parliament by end of July of every year. Parliament also presents its own budget, which legislation accounts for that? Dr Jantyies: Parliament is a separate arm of state, and its governance and management frameworks are set out in both the Constitution and Financial Management of Parliament and Provincial Legislatures Act of 2009 (FMPPLA). In terms of these legislative prescripts, Parliament is also required to present its budget in the National Assembly once appropriated in terms of the FMPPLA.
It is probably worth mentioning that the budget allocation to Parliament is proposed by National Treasury using the Public Financial Management Act (PFMA), similar to those for government votes. However, the final appropriation is approved by Parliament when adopting the Appropriation Bill every year by July. There is further Adjustment Appropriations that are done during the MTBPS period, also to be approved by Parliament.
What is the role of the PBO in these processes?
Dr Jantyies: The Parliamentary Budget Office was established by the Money Bills and Related Matters Act of 2009 to support Parliament in implementing the Act. The Parliamentary Budget Office provides analysis and advice to Parliament on all budget instruments (Fiscal Framework, Division of Revenue, Appropriation Bills and Tax and other Revenue Bills) proposed by government both in February and October.
Specific to the budget votes, the PBO advisory related to Appropriation Bills covers all the budget votes. And where necessary and required by Parliament, the PBO provides substantive analysis on a particular government function (budget vote). The analysis focuses on highlighting risk areas and the implication of budget proposals for service deliver and economic development.