TA to Mpumalanga and North West province to strengthen the Provincial Treasuries in providing support with the implementation of the Public Finance Management Act (PFMA)

Detailed description of project Back

The South African Government commenced with major financial management reforms including the MTEF framework in 1998, other budget reforms aimed at advancing and promoting growth and development and reforms governing public financial management. The main initiatives included a/o the adoption of the Public Finance Management Act (PFMA) in 2000 and the Municipal Finance Management Act (MFMA) in 2004.

The key objective of the PFMA and MFMA is to ‘modernise’ and capacitate local government. The reforms introduced by the PFMA and MFMA are the cornerstone of the broader reform package for national, provincial and local government and it has four interrelated components: planning and budgeting, revenue and expenditure management, reporting and oversight. Over the past 10 years the National Treasury provides a comprehensive programme of financial, advisory and technical support to all national, provincial and local government authorities towards implementation of the reforms in the PFMA and MFMA.

Provinces have varied levels of capacity and Mpumalanga and North West province have been identified as two of the provinces that can do with additional support, based on skills gaps within the treasuries, expenditure outcomes and quality of budget documentation.

The overall objectives of this intervention will be:

• To review and build on the finance reform foundation;
• To improve the financial management capacity and capability of provincial treasuries;
• To provide technical support, advise and assist the Provincial Treasuries with their capacity to provide technical support, advice and assist provincial departments and municipalities; and
• To provide capacity building and training workshops to provincial treasuries.

Type of services provided

Each Provincial Treasury is supported by a senior public finance management specialist. Core services include:

• Improvement of procedures and systems to cover budget processes, including budget preparation, implementation, monitoring and reporting;
• Build public finance management (PFM) capacity and foster awareness of PFM needs and effective responses to such needs;
• Liaise with management responsible for PFM to draft PFM strategy and areas forinterventions for the province;
• Facilitate the identification of, and ways of addressing, deficiencies in flow of PFM information internally and between the three spheres of government;
• Establish base line indicators in capacity to implement PFM reforms and to document status and progress in the provincial PFM;
• Draft detailed work programme responding to needs established, including those that enhance the provinces ability to monitor and assist municipalities and departments in their accountability in terms of the provincial budget process schedule;
• Assist and guide provincial treasuries to conduct reviews of Provincial Public Entities to ensure that these entities deliver on their respective mandates and be held accountable.