Feasibility Study for the Implementation of a Capacity Building Programme for Public Financial Management Improvement in South Africa

Detailed description of project Back

The National Treasury fulfils a pivotal role in the implementation and management of the Public Finance Management Act (PFMA) No 1 of 1999 as well as the Municipal Finance Management Act (MFMA) No 56 of 2003. The essence of both these Acts is to regulate financial management in the public sector at national and provincial levels and municipal level respectively. The PFMA as well as the MFMA are intended to ensure that all revenue, assets, liabilities and expenditures are managed effectively and efficiently and that the responsible officials are equipped with appropriate and necessary knowledge to adhere in a compliant manner to the intentions stipulated in the respective Acts. It is widely accepted that reforms in South Africa at the legislative and policy levels have provided a framework conducive for improving financial management at national, provincial and local levels respectively.At the same time, it is evident that a huge skills gap exists within financial management cadres of the public service to implement the applicable legislation, policies and procedures to an acceptable level. A crucial element on government’s financial management reform agenda would be to strengthen the individual as well as institutional capacity of financial management practitioners/government entities as well as the capacity of other officials involved in PFM.

The overall objective of the assignment is to conduct a feasibility study for a Capacity Building Programme that will contribute towards Public Financial Management Improvement in South Africa. The services rendered through this assignment is to provide decision makers in the South African Government as well as the EC and other interested donors with sufficient information and analysis to develop the Identification Fiche and the Action Fiche related to a sector support programme aimed at a government wide intervention to build capacity of financial management practitioners as well as officials involved in PFM. If the initial analysis is deemed to be feasible, the assignment will also produce adequate information on how to proceed to concluding a financing agreement.

Type of services provided

The services are provided by a team of 3 experts: Team Leader, PFM expert, Capacity Building expert. Core services include:

• Undertaking a review of the seven key areas of assessment for an EC funded Sector Support Programme (SSP), i.e. the sector policy (including consideration of key financial management reform issues such as Supply Chain Management, Planning and Budgeting, Internal Auditing, Accounting and Reporting, Risk Management, Asset Management etc.);
• Taking into consideration the five elements of the Paris Declaration on Aid Effectiveness and the EU commitments in this regard, assisting the National Treasury in collaboration with the relevant development partners to decide on the most appropriate financing modality for support to the public financial management sector;
• Compile an Identification Fiche and Action Fiche that would enable the proposed programme to be activated; and
• Detailing the design and implementation arrangements for the envisaged government wide capacity building programme for financial management improvement (identification of priority areas, objectives, indicators, etc.).