State Finance Act a stumbling block to public accountability

Windhoek – Namibia needs to review its State Finance Act to guard against wasteful management of public funds and improve on budget transparency.
Established under resolution of Parliament are nine standing committees in the National Assembly, among them is the Standing Committee on Public Accounts tasked with ensuring accountability in government institutions.
The Public Accounts Committee’s main mandate is to examine financial reports from the Auditor-General and to check if budget allocations to various government ministries and agencies are spent as intended.
But the committee will remain a toothless bulldog unless the State Finance Act (31 of 1991) is amended, says former opposition lawmaker, Johan de Waal.
Of concern to De Waal, who served on the committee as chairperson, are the limited powers of the parliamentary committee, which he blames on the status of the State Finance Act.
The committee does not have powers to subpoena public officials and, in most instances, officials appear before the committee at public hearings if they so wish.
Once they heed the invitations, the Public Accounts Committee does not have the power to administer oath, therefore, there is no way it can verify statements made at public hearings.
The former DTA of Namibia lawmaker says Parliament could only guard against wasteful mismanagement of public funds if a penalty clause is included in the State Finance Act to bring to book public officials that contravene established rules on public expenditure.
“The main problem of the Public Accounts Committee is the State Finance Act – there is no penalty clause in the Act. The account committee should be given implementation mandate in order to enforce the law,” De Waal says.
“Similarly if you make a rule to protect the taxpayer and the general public against corruption, wasteful expenditure and mismanaging of public funds you must enforce that rule by way of penalties. If not, some accounting officers will become more and more reckless, with disastrous consequences.”
In May 2011, Cabinet approved the proposed amendments to the State Finance Act.
Cabinet acknowledged that the current scope of the Act is not fully defined and there are a number of omissions regarding policy and management functions.
Cabinet further noted that over the years, since 1995, it has been observed that the law still has some areas that need to be re-looked into, in order to respond to the current situation of the economy.
Aldrin Manyando, the Public Relations Officer in the Ministry of Finance, was earlier quoted in the media saying the new State Finance Act is still in consultation phase.
He submitted that there is no timeframe for the finalisation of the consultations and when the Bill will be tabled in Parliament.
De Waal made the comments during the launch of the International Budget Partnership’s latest Open Budget Index and its findings on Namibia by the Institute for Public Policy Research (IPPR) on January 23.
The Open Budget Index (OBI) is based on a comprehensive survey that evaluates whether central governments in 100 countries give the public access to budget information and opportunities to participate in the budget process.
The survey also examines the ability of legislatures and auditors to hold the government accountable.
According to the survey, Namibia in the mid-range of countries that produce some of the required information.
The country has increased its budgetary transparency score from 53 points out of 100 in 2010 to 55 for 2011/12 budget survey.
“Namibia’s score indicates that government provides the public with only some information on the budget and financial activities throughout the year. This makes it challenging for the public to hold government to account,” said Graham Hopwood, Executive Director of IPPR.
Hopwood said Namibia could make further strides in budget transparency if it introduces other key elements like pre-budget statement, mid-year review, strengthen the role of legislature, and enhance public participation.
The report found that 77 of the 100 countries assessed failed to meet basic standards of budget transparency.
This matters because budgets are the main tool governments use to set policies for raising and spending public funds, which promote development and meet the needs of the citizens, according to IPPR.
The institute noted that the impact of open and accountable public finance on development within the countries is particularly importance as the international community begins to think about the next Millennium Development Goals.
In Southern Africa, Namibia comes second behind South Africa, and just ahead of Botswana and Malawi.
High scorers for the 2012 edition include New Zealand, South Africa, the United Kingdom, Sweden, France and Norway, while the worst performers include Qatar, Equatorial Guinea, Zambia, Nigeria and Zimbabwe.


February 2013
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