Treasury regulations cannot supersede legislation on the timely tabling of annual reports

1 November 2022

Note to editors: Please find attached soundbite by Ghaleb Cachalia MP

The DA finds it highly irregular that Parliament has decided to cede its legislative role and allow national Treasury to use its regulatory power to overwrite a legislation amendment process that was initiated by the DA.

In order to address accountability loopholes that exist in the timely tabling of annual and audit reports by government departments and their entities, the DA had tabled a Private Members Bill (Public Finance Amendment Bill B13-2020) to amend section 65(2) of the Public Finance Management Act (1999).

When the Bill came before the Standing Committee on Finance, Treasury supported it in principle but made a curious proposal to outsource legislation to itself which, in effect allows for National Treasury and the executive’s continued unfettered freedom to potentially keep the door open to executive’s discretion in the tabling of annual and audit reports.

On 28 October 2022, Treasury sent a written note to SCOPA stating that changes to section 65(2) of the PFMA by the Public Finance Amendment Bill B13-2020 were now covered under Treasury Instruction No.2 of 2022/2023. The implication was that the Committee should discard further processing of the Bill as the published treasury regulations had filled the gap.

This development is unprecedented as Treasury appears to imply that its own regulations can supersede any parliamentary process, least of which is the amendment of legislation.

The continued failure by government departments and their entities to table annual and audit reports on time, a mischief that this bill attempted to address, has been evident for many years. Indeed, the bill was first introduced by the DA in 2018 some four years ago. During these four years National Treasury have failed to issue any “Instructions” and/or regulations that they now claim is the solution to the problem.

Seeing that Treasury has, 2 years running, failed to submit its annual and audit reports on time, it is perhaps not surprising that they would be reluctant to have an amendment to the PFMA that will make them accountable. It is unfortunate that Parliament has chosen to humor them in this abuse of processes.

Issued by Ghaleb Cachalia, DA Shadow Minister of Public Enterprises, 1 November 2022