In
2016, Cabinet identified the need to strengthen the alignment of the South
African Budget, the Medium-Term Strategic Framework (MTSF) and the National
Development Plan (NDP), and for budget prioritisation to focus on the last 24
months of the current administration. The Department of Planning, Monitoring
and Evaluation (DPME) and the National Treasury (NT) were instructed to develop
a Mandate Paper to guide the budget process for 2018, to ensure a focused
implementation of Government’s plans.
B OBJECTIVES OF THE MANDATE PAPER
Government
plans are implemented at different levels across the three spheres of
Government (national, provincial and local) and across a large number of public
entities and State-owned Companies. The Mandate Paper aims to guide all spheres
of Government and all Government entities to refine plans and develop budget
proposals. The Mandate Paper therefore has to consider the specific functions
and strengths of these institutions as well as the various pressures they face.
The
Mandate Paper’s objective is to establish the strategic framework for
decision-making on budget priorities that are required to advance the goals of
the National Development Plan (NDP). It seeks to establish a systematic basis
for making strategic choices among competing priorities and limited resources,
in order to better optimise the budget as a key lever for driving the NDP.
The
Mandate Paper further sets out a broad set of prioritisation criteria which should
guide the consideration of budget proposals for 2018/2019. It does not indicate
specific funding allocations, which is part of the budget process led by
National Treasury, but makes recommendations on the priorities which will focus
the Budget on the achievement of the goals of the NDP.
The
Mandate Paper does not supplant other Government plans such as the NDP, nor is
it about ad hoc priorities. It is not a
comprehensive policy analysis tool and agenda which are dealt with by the MTSF
recommendation for the balance of the term of Office. In fact, its point of
departure is South Africa’s development goals and objectives as embodied in the
NDP. It seeks to reinforce initiatives that have the greatest growth and
transformative impact in terms of the NDP goals and targets and that must be
prioritised in the budget and in decision-making. In this regard, the Mandate
Paper is firmly focused on the outcomes spelt out in the NDP and the MTSF, of a
decent life for all South Africans, the eradication of poverty and the
reduction of unemployment and inequality.
In
this way the Mandate Paper seeks to tighten the alignment between the budget
and implementation plans of all National, Provincial and Local Government
departments, public entities and State Owned Companies.
The
prioritisation process led by DPME will take place prior to National Treasury’s
budget or Medium-Term Expenditure Committee (MTEC) process and is led by the
DPME. The Mandate Paper as approved by Cabinet therefore sets specific
priorities aligned with the NDP in the existing socio-economic context in order
to guide the detailed allocation of funding by National Treasury, and in this
way ensure that the budget better advances national developmental goals.
The
practice of strategically framing and priority setting for budget allocation is
prevalent in many countries, particularly countries that have adopted and are
implementing National Development Plans (NDPs). The practice in other countries
has a clear legal and institutional basis with varying levels of maturity.
Common elements of NDPs and Budget Prioritisation Frameworks include:
·
Firm commitment within and outside government
to the long-term development vision and priorities for the country, a clear
strategy to advance the vision and key performance targets.
·
Alignment between the priority setting
process and the Budget process
·
Recognition that development needs often
outstrip the availability of resources.
·
Alignment between priority setting and the
budget process often involves trade-offs and is informed by the specific
socio-economic context.
·
Transparent and formal consultations,
including public participation
·
Legal and operational enforceability of decisions
and resource allocations by the political executive.
South
Africa had a number of the above elements in place, with the exception of a
strong alignment between the priority setting process and the Budget process.
The Mandate Paper process seeks to overcome this gap. The South African Mandate
Paper process will however, need to be reinforced and formalised
institutionally and legally through practice notes and directives. This will be
addressed in proposals for legislation by DPME to clarify and institutionalise
South Africa’s planning system. Consultations within and outside Government are
planned on this in the coming months.
Moreover,
in order to be an effective guide to planning and budgeting at national,
provincial and local spheres, it is envisaged that in the next financial year the
process for developing the Mandate Paper will have to be brought earlier in the
annual planning cycle. The proposal is for the Mandate Paper to be finalised by
April 30th of every year to guide the preparation of budgets in the May
to July process.
To download the full document, click the link below
DPME Mandate Paper for Public Release 2018.pdf
