PARLIAMENT OF THE REPUBLIC OF SOUTH AFRICA
TO: Chairperson,
Standing Committee on Public Accounts [Mr N T Godi, MP]
SUBJECT: Secretary
to Parliament appearing before SCOPA
1.
The Standing
Committee on Public Accounts (SCOPA) requested the Secretary to Parliament, in
his capacity as accounting officer, to appear before it in regard to the Annual
Report of Parliament 2004-2005. In a letter dated 29 May 2006 the Secretary
replied that the Parliamentary Oversight Authority (POA) decided on 21 April
2005 that the accounting officer of Parliament will not report to SCOPA or any
other parliamentary committee, but will be reporting to the POA. I was
requested to advise on the letter.
2.
The crisp
issue is whether the decision of the POA referred to above is consistent with
the Constitution, applicable legislation and the standing rules of Parliament.
Parliamentary
Oversight Authority
3.
The POA is
part of the Governance Model for Parliament approved by the Joint Rules
Committee (JRC) on 18 November 2004. During the meeting of SCOPA on 31 May
2006, a number of members enquired about the POA. Attached please find a
document relating to the new Governance Model for Parliament.
4.
In terms of
rule 56(1)(a) of the Joint Rules, the JRC may develop, formulate and adopt
policy concerning the joint business of the Houses, and specifically in respect
of the financial management and policy of Parliament. The Governance Model for
Parliament, including the POA, is such adopted policy applicable to Parliament.
Item 5.2 of the document relating to the functions and responsibilities of the
POA provides that the POA is responsible for ensuring compliance with
accounting standards and policy. Item 5.8 requires the POA to report to
Parliament on its operations.
5.
It follows
that the POA is specifically authorised to implement policy regarding financial
accountability of Parliament. Pursuant to this, the POA instructed the
accounting officer to report to the POA and not to SCOPA. It would be for
Parliament to question this decision when the POA reports to it.
6.
Section
31(9) of the of the Powers and Privileges of Parliament Act, 1963, which is not
repealed by the Powers, Privileges and Immunities of Parliament and Provincial
Legislatures Act, 2004, provides that accounts of Parliament must be audited by
the Auditor-General (A-G). I am not aware of any legislative provision
determining the submission of Parliament’s annual report, financial statements
and the report of the A-G on those financial statements.
7.
NA rule
206(1)(a)(iii) provides that SCOPA must consider any reports issued by the A-G
on the affairs of any executive organ of state, constitutional institution or
other public body. NA rule 206(1)(a)(iv) provides that SCOPA must consider
any other financial statements or reports referred to it in terms of the NA
Rules.
8.
Based on the
assumption that the phrase “or other public body” in NA rule 206(1)(a)(iii)
includes Parliament, the report of the A-G on the financial statements of
Parliament was considered a report issued by the A-G that falls within the area
of competence of SCOPA, at least during the previous two financial years.
9.
In my
opinion the interpretation of NA rule 206(1)(a)(iii) so as to include
Parliament within the area of competence of SCOPA does not take full cognisance
of the constitutional status of the Parliament, and especially the NCOP. SCOPA
is a committee of the NA and I am not aware of anything in the Constitution
that empowers the NA to call the NCOP to account. Furthermore, the context of
the wording “or other public body” used in NA rule 206(1)(a)(iii) is in my
opinion more aligned to the organs that must account to Parliament in terms of
the Constitution and the Public Finance Management Act, 1999 than to the
broader term “organs of state” used in the Constitution that includes
Parliament.
10.
Be that as
it may, the fact that SCOPA dealt with the report of the A-G on the financial
statements of Parliament was a result of a political decision, which would be
consistent with the inherent constitutional authority of the respective Houses
to determine and control its internal arrangements, proceedings and procedures
(sections 57(1) and 70(1)). Of course the NA could have referred the report of
the A-G to SCOPA in terms of NA rule 206(1)(a)(iv).
11.
Until
otherwise regulated by legislation, the Houses are free to determine the manner
in which to deal with the financial statements of Parliament and the report of
the A-G on those statements.
12.
Addressing
the lack of certainty in regard to manner of reporting on the financial
statements of Parliament and the A-G’s report on those statements is the
purpose of the draft Financial Management of Parliament Bill, 2005 (published
in the Government Gazette No 28166 on 28 October 2005). However, until
this legislation is operational, Parliament may determine the manner in which
its financial statements and the A-G’s report on those statements will be
submitted for purposes of oversight and accountability.
13.
Until the
decision of the POA referred to above, the practice was for SCOPA to
interrogate the financial statements of Parliament and the A-G’s report on
those statements. The decision of the
POA to change this practice is in my opinion consistent with the legislative
framework relating to Parliament’s financial management and the POA must report
to Parliament in respect thereof.
Adv F S Jenkins
PARLIAMENTARY LEGAL ADVISER