Report of the Portfolio Committee on Finance on the Money Bills Amendment Procedure and Related Matters Bill [B75 – 2008] (National Assembly – proposed sec 75), dated 23 September 2008.

1. Introduction

The Portfolio Committee on Finance, having been instructed by the National Assembly to consider a procedure to amend money bills before Parliament with a view to introducing a bill dealing with the matter (see Minutes of Proceedings of the National Assembly, dated 26 June 2008), reports as follows:

On 26 June 2008 a resolution was passed by the National Assembly mandating the Portfolio Committee on Finance to consider the subject of a procedure to amend money bills before Parliament with a view to introducing a bill dealing with the matter.

The Committee gave prior notice of introduction of the draft legislation in Government Gazette No 31238, dated 10 July 2008. The Gazette also contained an invitation to interested persons and institutions to submit written submissions on the draft legislation. The Committee deliberated and held public hearings on the submissions received.

The Committee therefore reports that it has completed its deliberations on the matter and, in accordance with Assembly Rule 243, introduces the Money Bills Amendment Procedure and Related Matters Bill [B75 – 2008] (National Assembly – proposed sec 75).

2. Additional Matters for Inclusion in the Rules

2.1 Procedures in the House

2.1.1 Budget Review and Recommendation Report

The Budget Review and Recommendation Report (BRRR) is submitted annually by portfolio committees to the National Assembly for adoption in terms of Section 5 of the Bill.

The BRRR is the main opportunity for portfolio committees to influence policy and budget decisions by executive departments, entities and public institutions as part of oversight and for the National Assembly to debate the performance of these organisations. The BRRR brings together key parliamentary submissions and procedures for each department, entity or public institutions, including the annual report, the strategic plan, the report of the Committee on Public Accounts and the medium term budget. The procedure for the adoption of the report therefore needs to express the importance of the occasion.

The Rules should set out a procedure for:

portfolio committees to submit the BRRR;

the House to debate and adopt the report; and

the tabling and adoption of BRRR to fall between the adoption of the Appropriation Bill (and medium term estimates for the department, entity or institution) and the adoption of the reports relating to the Medium Term Budget Policy Statement (MTBPS).

2.1.2 Medium Term Budget Policy Statement

The MTBPS is split into the macro-economic fiscal framework and division of revenue expenditure parts and referred to the committees on finance and committees on appropriations respectively. This means that each committee will report separately to the Houses.

The Rules should set out a procedure for:

the adoption of the MTBPS report in the Houses, similar to the procedure that is currently followed, but separately for each section; and

consultation processes between the committees on finance and appropriations of each House, on the one hand, and other committees of the respective Houses, on the other, as required in terms of clauses 6(4) and (9).

3. National Budget, Fiscal framework, Revenue proposals and Appropriation Bill

The Bill sets out which parts will be referred to which committees for consideration and report, as follows:

3.1 Fiscal Framework and Tax proposals

The fiscal framework and tax proposals are referred to the committees on finance established in terms of section 4 of the Bill.

The committees must report back to the Houses within 16 days after the tabling of the National Budget in terms of clause 8(3) of the Bill. Adoption must be by a majority of votes cast in the National Assembly and five provinces in the National Council of Provinces, as required by sections 53 and 65 of the Constitution.

The Rules should set out a procedure for the:

Committees on finance to table the report with or without proposed amendments to the fiscal framework and tax proposals; and

Houses to debate the report and adopt the fiscal framework with or without amendments.

3.2 The Division of Revenue Bill

The Division of Revenue Bill (DORB) must be considered in accordance with the procedure established by section 76(1) of the Constitution. The DORB must be referred to committees on appropriations of each House in terms of clause 9(1) of the Bill.

The Rules should set out a procedure for the tabling and adoption of the DORB:

in the NA, within 15 days from its introduction; and

in the NCOP, within 20 days from its referral.

3.3 The Appropriation Bill

The Appropriation Bill must be referred to the committee on appropriations of the National Assembly after the adoption of the fiscal framework. However, amendments to the appropriation Bill may only be considered after the adoption of DORB. Members of Parliament, through the various portfolio, select and other committees may propose amendments to the appropriation Bill, during the passage of the Bill through the Houses, through consultations with the committees on appropriations of the respective Houses. This will provide appropriate opportunities for members to propose amendments, while ensuring that all amendments must go through the same rigorous process of analysis and assessment against all other amendments within the expenditure constraints imposed by the fiscal framework and the adopted DORB.

The Rules should set out a procedure for:

other committees to consult with the respective committees on appropriations;

the respective committees on appropriations to report to the Houses on the Bill and any proposed amendments, including those proposed by other committees during the first reading debate;

other committees to submit an update on the BRRR before the tabling of the MTBPS, if necessary and material to the amendments being considered;

a debate and approval of each amendment separately in the House;

the bill to be processed vote by vote after the first reading debate; and

the bill to be passed, during the second reading debate, with or without the consolidated amendments reported in the first reading debate.

3.4 The Adjustment Budget

For the adjustment budget the rules must allow for a mini-fiscal framework, Division of Revenue Amendment Bill and adjustments appropriation bill procedures in the House, in line with the procedures set out in the Bill.

3.5 Revenue Bills and other money bills

The rules must allow for the committees on finance to submit their reports, followed by a reply from the Minister of Finance (and other affected members of Cabinet for other money Bills that appropriate money), followed by debate.

4. Proposed timeline (Fiscal framework, DORB, annual money bills)

See annexure.

Report to be considered

	Executive	National Assembly				NCOP
		Portfolio	Committee on Finance (COF)	Committee on Appropriations (COA)	House	Select	COF	COA	House
June					Passes Appropriation Bill
July		Research and hearings for BRRR							Passes Appropriation Bill
Aug
Sept
Oct	Submits Annual Report by 31 Oct (PFMA)				Adopts all BRRRs before adopting MTBPS reports
Nov	Submits MTBPS (by 15 November but exact date Executive discretion)		Hearings and Report on macro and fiscal framework of MTBPS and adjustments budget	Hearings and report on division of revenue, conditional grants and expenditure MTBPS and adjusted DORB and Appropriation Bill			Hearings and Report on macro and fiscal framework of MTBPS and adjustments budget	Hearings and report on division of revenue, conditional grants and expenditure MTBPS and adjusted DORB and Appropriation Bill
Dec					Adopts MTBPS and Adjustment Budget reports within 30 days of tabling				Adopts MTBPS and Adjustment Budget reports within 30 days of tabling
Jan
Feb	Tables National budget, Fiscal Framework, DORB, Tax Proposals and Appropriation Bill		Considers Fiscal Framework and Tax proposals, report for adoption in House within 16 days				Considers Fiscal Framework and Tax proposals, report for adoption in House within 16 days
March	Tables updated strategic plans by mid-March	Considers strategic plans, ENE and budget and proposes amendments, if so decided. Provides amendments to COA by time DORB passed in parliament.		Considers and reports on DORB and for house to pass within 15 days after passing of fiscal framework (end of first week in April)	Adopts Fiscal Framework within 16 days after tabling (mid March)	Considers strategic plans, ENE and budget and proposes amendments, if so decided. Provides amendments to COA by time DORB passed in parliament.			Adopts fiscal framework within 16 days after tabling (mid March)
April			Revenue amendment bills (as they are tabled)		Passes DORB by first week in April		Revenue amendment bills as they are passed on by NA	Considers/reports on DORB for house to pass within 20 days after NA has passed DORB (first week in May)
May				Considers proposed amendments to Appropriation Bill and reports to House by end of first week in June (4 weeks)					Passes DORB by first week in May
June					Process in house to approve amendments and pass Appropriation Bill. Bill passed by end of third week in June (2 weeks)
July	President signs Appropriation Bill into law by end July.							COA considers proposed amendments and reports to House so that house can pass Appropriation Bill by mid-July

“Annexure