South Africa: National Council of Provinces Passes Two Bills
The Appropriation Bill is a key part of the national budget. It outlines how government funds will be allocated among various departments. Section 27(1) of the Public Finance Management Act requires the Minister of Finance to table the annual budget for a financial year in the National Assembly before the start of that financial year or, in exceptional circumstances, on a date as soon as possible thereafter.
The Minister of Finance tabled the National Budget for the 2025/26 financial year, including the Appropriation Bill and the Eskom Debt Relief Bill, in May this year. Following the passing of the Bill in the National Assembly last week, the Appropriation Bill was subsequently referred to the Select Committee on Appropriations for consideration and reporting back to the NCOP plenary sitting for adoption.
This Bill is the law that authorises government to use public funds for various departments and entities, enabling them to deliver services and develop infrastructure and social programmes such as healthcare, education and social grants, while also supporting economic growth. The Bill also focuses on job creation and addressing unemployment.
On the other hand, the main objective of the Eskom Debt Relief Bill is to amend the Eskom Debt Relief Act of 2023 by reducing the financial requirements for Eskom for the 2025/26 financial year. It proposes that the entire amount for that year be treated as a loan, which can be converted into equity upon the fulfilment of certain conditions.
The Bill also introduces interest into the Eskom debt relief package at a market-related rate. The aim is to balance the interest charge and Eskom's cash flow, while reflecting a fair market-related rate. This is part of ongoing interventions to stabilise the power utility, which has faced years of operational challenges and financial crisis, and to modify its debt relief plan. Now that the Bill has been passed, there is hope that Eskom will have a more enabling balance sheet to spend more money on improving its capacity to supply electricity.
These two Bills passed by the NCOP will now be sent to the President for assent, as required by the Constitution.
Once Parliament passes the Appropriation Bill and signed into law by the President, government departments are allocated funds and commence implementing their approved spending plans. Parliament then exercises ongoing oversight through its portfolio and select committees to ensure accountability in the use of public funds. The Auditor-General conducts independent audits of departmental spending and reports the findings to Parliament. Where instances of financial mismanagement or underspending are identified, Parliament may recommend corrective action to ensure responsible and effective use of public resources.
Distributed by APO Group on behalf of Republic of South Africa: The Parliament.
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