Model Public Financial Management Bill set at ‘…

Many countries, including those in the Southern African Development Community (SADC) region, have signed up to a multitude of regional and international instruments aimed at improving the standard of living of their citizens.

These instruments include the United Nations Convention on the Rights of the Child; the African Charter on the Rights and Welfare of the Child; the African Youth Charter; the United Nations Universal Declaration of Human Rights; the United Nations International Covenant on Economic, Social and Cultural Rights; the United Nations Convention on the Elimination of All Forms of Discrimination against Women; the United Nations Convention against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment; and the United Nations Convention on the Rights of Persons with Disabilities.

Responsibility

National parliaments around the world are mandated to hold their governments accountable for the use of state resources in realizing the rights contained in these instruments. For many years, some national parliaments have struggled to play this role due to a range of challenges, including the absence of an effective public financial management architecture and insufficient support from parliamentary committees.

To fill this gap, the SADC Parliamentary Forumwhich brings together 15 SADC National Parliaments, is developing the SADC Model Law on Public Financial Management to, among other objectives, promote good governance, accountability and transparency in the use of public resources.

The model law also aims to ensure that the public budget presented each year describes how public resources are spent to meet the United Nations Sustainable Development Goalsuniversal health coverage and other international treaty commitments in order to facilitate their monitoring by public and private actors.

Namibian Deputy Finance Minister Maureen Hinda-Mbuende expressed optimism about the model law, saying it can strengthen related checks and balances in the region.

On 15 February 2022, the SADC Parliamentary Forum convened a virtual consultative meeting with representatives from ministries responsible for finance, economic development, good governance and institutional reforms from across SADC to comment on the draft model law. Representatives of Planning Commissions and Accountants General of SADC Member States also attended the meeting.

The Deputy Minister, who was the keynote speaker, urged the Parliamentary Forum to ensure that the evolving model law complements the public financial management tools that SADC Member States already have in place, to ensure that what is budgeted is implemented and that governments live within their limits. means.

Monitoring

“Some of the checks and balances include the executive having to seek approval from the legislature before taxes, fees or fines can be imposed and for any expenditures. This arrangement also empowers the legislature to exercise control over public spending during the budget execution process or ex-post oversight facilitated by our supreme audit institutions through our permanent parliamentary committees on public accounts where they exist,” said Hinda-Mbuende.

She welcomed the consultation process, saying it provided stakeholders with an opportunity to reflect on their countries’ laws and regulations and align them with prevailing international standards.

She highlighted the role of strong public financial management frameworks in ensuring peace and stability, good governance and access to basic services.

“You are therefore required to consider whether the contents of the model law will be useful in providing a normative framework that can help strengthen regulations governing the use of public resources in the SADC region,” she said. .

The secretary general of the SADC Parliamentary Forum, Boemo Sekgoma, explained that the model law was being drafted with a view to making it a “gold standard” on the use of public resources.

Line ministries played a key role in preparing budgets, managing public debt, committing to state spending and monitoring to avoid discrepancies when disbursing funds, Sekgoma said.

Well-received Model Bill

Delegates welcomed the draft model law and made comments. Monaosyile Mhango from Malawi suggested that the project should include issues of macroeconomic policy, national budgeting, risk management and guidance on policy formulation on public financial investments.

As a critical analysis, she highlighted the need to focus on the functions of the Accountant General and Auditor General.

On parliamentary engagement and oversight, Mhango said Malawi and other SADC member states already have a number of parliamentary committees such as a budget and finance committee.

With regard to the control of public enterprises and their financial performance, she recognized that the model law on the management of public finances would be of paramount importance in strengthening parliamentary control. Article 6 of the model law provides a list applicable to public enterprises.

Ellen Maduhu from Tanzania also thinks the model law is a step in the right direction. “Tanzania believes that this model law will be a guiding instrument for national parliaments to strengthen their national legal frameworks on public financial management.”

Internal audits

She recommended that the draft contain a section describing and emphasizing the importance of internal audits in a country. She explained that Tanzania had developed a specific Local Government Finance Act which included provisions on sources of funds, revenues and management thereof.

“In this regard, we propose that the SADC Model Law on Public Financial Management recognizes that some SADC countries have laws regarding public funds managed by local authorities,” she said. For reasons of certainty, it was necessary to provide for the opening of bank accounts by governments.

Furthermore, she pleaded for the inclusion in the model law of a section on how Member States can curb the misuse of supplementary budgets.

Elizeus Kalugendo, also from Tanzania, requested a section providing guidance on how government financial statements should be prepared.

On that note, veteran legal writer Daniel Greenberg, who drafts the SADC model law on public financial management with the support of a technical working group, explained that the model law seeks to strike a delicate balance, between clarity and simplicity on the one hand and flexibility and certainty on the other. He thus argued that it would be difficult to be prescriptive through a model law “without denying contextualization and flexibility”.

Clarity needed

However, he acknowledged the need for the model law to be clear enough to avoid missing the basic principles of public finance management.

Kennedy Musonda of Zambia said the model law should provide guidance on how member states can manage conflicts that may arise from other public financial management laws.

from Malawi Daisi Kachingwe Phiri felt that there was a need to clarify how donations and grants given to Member States should be accounted for. “How does the model law deal with donations and grants from organizations that operate in various SADC countries? Is it public money? How is liability for these funds addressed in the model law? »

Greenberg explained that in some countries this was done through internal audit requirements, which in some cases had to meet conditions set by grant or donation providers.

Sekgoma said it was important for delegates to understand that “the main provisions of the model law” were to be able to reinforce what exists at the national level “on the appropriate legislative occasion”.

She added that the consultations on the model law on public financial management were particularly aimed at collecting the views of different stakeholders for the purpose of rationalization, as opposed to defending a particular position on public financial management. .

She underlined: “At this stage, the divergent points of view of the stakeholders are welcome because it allows to test the model law. Ultimately, validation of the most relevant provisions to be included will be conducted by the relevant standing committees of the SADC Parliamentary Forum. » SM/MC

Moses Magadza is a communications and media scholar pursuing a doctorate in media studies. Clare Musonda, a lawyer and social scientist, is Director of Corporate Governance at the SADC Parliamentary Forum.

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