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The Municipal Budgets II - Roleplayers Documentation and ProcessesGiven the rudiments of the legislative and regulatory dispensation that have been put in place for driving the diverse aspects of the municipal budgetary process, there is a need to reflect upon some of the practical dimensions. Of significance here are a number of actions and procedures as well as the output of documentation aimed at giving a comprehensive picture of what is transpiring at the financial level. The ensuing discussion therefore aims to provide a degree of clarity about practices and practical issues - and the focus accordingly is on the roleplayers, the documentation and the processes.
The municipal financial management legislation is very specific with regard to the institutional structures that have to be deployed and goes some way in setting out who has to perform what functions as far as the budgetary processes are concerned.
Thus, it is stated in the legislation that one of the primary financial responsibilities of the mayor relates to what is being described as the "budget process and related matters." Accordingly, he has a very specific mandate to "provide general political guidance over the budget process and the priorities that must guide the preparation of the budget." Further, the mayor must "co-ordinate the processes for preparing annual budget and for reviewing the municipality's integrated development plan and budget-related policies to ensure that the budget, the integrated development plan and the budget-related policies are mutually consistent and credible". Given his duty that the budget goes through the necessary stages at the required times, the mayor must ensure that the municipal council approves its budget before the commencement of the new financial year. Further, he has to see to it that the service delivery and budget implementation plan is approved within 28 days of the approval of the budget.
The accounting officer of the municipality, who in terms of the Systems Act is the municipal manager, is responsible for preparing and implementing the budget. As far as the preparation is concerned, the accounting officer has to provide the mayor with administrative support, resources and the information essential for the mayor to meet the commitments imposed on him. With regard to budgetary implementation, it is incumbent upon the accounting officer to take steps to ensure that expenditure takes place in line with the approved budget. The municipal financial management legislation provides for the establishment of a budget and treasury office, which is to be headed by the chief financial officer assigned to this position by the municipality's accounting officer. As far as the budget is concerned, the chief financial officer will have to perform such functions as are delegated to him by the accounting officer.
Provision has been made in the legislation for the establishment of a treasury and budget office. The role and duties of the budget office will in all probability be set out in the regulations, which stands to be continuously updated. Considerable emphasis here will doubtlessly be on technical proficiency and the continuing upskilling of staff members.
The budgetary documentation
Provisions contained in the municipal financial management legislation in broad terms prescribe the budgetary documentation that has to be drawn up and released, but these provisions themselves are not definitive as to the format in which the documentation has to be presented. This is left to the regulations being issued. Rather, the legislative provisions reflect on the more substantive aspects of the information to be divulged. There further is a need to take a look at the documentation released for public consumption. To address the upfront interests of the press and broader public, the municipality's communications department or desk releases the budget speech and brochures or pamphlets containing information on the main features of the budget.
Having regard for the fact that it also has to be made publicly available, formal council documentation usually consists of a set of accounts reflecting the details of proposed expenditures, appropriations under the respective budget votes as well as indicative projections as to how the envisaged expenditures are to be financed from revenues and funds otherwise raised. With regard to expenditures, very specific provision is being made for the division of the annual budget into an operating and a capital budget. Further, a host of additional documentation must accompany the budget at the time of its tabling. Of considerable importance are the draft resolutions for the levying of rates, taxes and other charges and those for the approval of such municipal entities as are to fall under either the sole or shared control of the municipality. Then there are still documents such as those on the measurable performance objectives for each of the respective votes as well as the cash flow projections per revenue source and per vote.
Subsidiary documentation consists of those on amendments to the budget-related policies of the municipality; particulars having a bearing on investments by the municipality; particulars of proposed service delivery agreements; and particulars of any proposed allocations by the municipality to other municipalities, municipal entities and other public sector bodies.
Given the very comprehensive documentation being made available, the interests of transparency must be considered as being particularly well served. However, the respective documents can also be perceived as being in the throes of a development process. The larger municipalities could be seen as enjoying a decided head-start and it should therefore come as no surprise that there is specific provision being made in the new financial management legislation for powers for National Treasury to prescribe the format of the budget as well as the formats of the resolutions and supporting documentation relating to the annual budgets.
The budgetary processes
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