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Send  Share  RSS  Twitter  07 Dec 2011

LOCAL GOVERNMENT: Will the PFMA Be Amended‘

 





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Will the PFMA be amended, and how will this impact on municipal accountability‘ Despite the removal of a number of underperforming municipal and government officials and the loss of billions in public funds, up till now, no officials have been criminally prosecuted under the Public Finance Management Act (PFMA). Municipal management have an opportunity to get their house in order to guarantee immunity from proposed changes to the PFMA legislation.

Pravin Gordhan, the Minister of believes changes to the Act are needed to ensure “greater accountability” for officials by improving the efficacy of sanction action available to those who flaunt their position. The minister would like to see a shift in government where strong leadership results in waste being reduced through the promotion of “moderation and modesty”.

The call by Gordhan has been met by approval and support from the Accountant-General, Freeman Nomvalo, who said that Members of Parliament need to be tougher when dealing with misconduct in government departments and state entities. The amendment would strive to ensure that stronger action is taken against officials involved in corruption.

PFMA Looks to Be Amended to Help Governmental Departments


Thembi Godi, chairman of the Standing Committee on Public Accounts (Scopa), ratified the feelings of Gordhan and Nomvalo when he called for an amendment to the PFMA to make it easier for heads of department to be held criminally liable for gross negligence. In a press conference in Cape Town on November 10th, Godi addressed the media on the committeeÂ’s plans to manage more governmental departments.

KwaZulu-Natal has seen a sharp decline in government expenditure that has contributed to the stifled growth in the province. Economic growth is below the national average at a year-on-year growth rate of 1.2%. Although most provinces declined in economic activity in the past year it seems as if KwaZulu-Natal has been the hardest hit.

Accountability is being brought to the forefront of public opinion through the recent political events and associated media coverage. Local and National government needs to address the issues of maladministration and corruption in more proactive manner. This can be achieved through a process that looks at prevention rather than the cure by creating a compliant government that is transparent.

Municipal Managers, CFO's and Heads of Revenue at municipalities are in the main very driven to achieve higher levels of financial compliance and sustainability. But often with limited human and financial resources, data normalisation, compliance and revenue enhancement are a real challenge.

Amendment of PFMA Can Help Municipalities to Achieve Goals


There is an opportunity for these motivated and well-meaning municipal managers to achieve their compliance, revenue and service delivery goals. Municipal billing databases can be updated and cleansed to uncover un- and under-billed customers. Revenue can we increased without burdening existing paying customers with tariff increases and toll roads. With a bit of expert outside help, municipal officials and managers can uncover un- and under-billed consumers who have been enjoying the benefit of service delivery due to abnormalities or irregularities in the billing system.

Collaborating with the private sector who have the resources and a wide range of skills and specialities that cover areas such as legal, technical, information technologies, and finance, makes sense. Smart Metro has over 30 years of experience with public entities and applies data analytics to completely transform and improve record keeping and financial performance of municipalities. The amendment of the PFMA can help boost municipalities and create greater good within South Africa.


 
 
 
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