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ESKOM EXEMPTION: NATIONAL TREASURY UNPACKS NEW APPROACH TO IRREGULAR, FRUITLESS, WASTEFUL EXPENDITURE REPORTING
- 05 April 2023
- State Owned Enterprises
- SA Legal Academy
Please note: Following a joint meeting with all relevant National Assembly committees, National Treasury issued a media statement withdrawing the exemption.
A National Treasury document presented at a joint meeting of several National Assembly committees has provided more insight into government’s new approach to reporting on irregular, fruitless and wasteful expenditure.
This follows Finance Minister Enoch Godongwana’s decision to exempt Eskom from certain obligations under the Public Finance Management Act, 1999. The partial exemption was gazetted on Sunday 2 April 2023 in a notice backdated to 31 March 2023.
On 3 April 2023, Treasury to issue a media statement on the move with supporting documents. The following day, the National Assembly’s Public Enterprises Committee and Standing Committees on Appropriations, Finance, the Auditor-General and Public Accounts issued a press release on arrangements for a briefing from the Minister. The briefing took place on 5 April 2023.
According to the presentation document, efforts by ‘key state-owned enterprises’ to ‘reverse the effects of state capture’ are being stymied by ‘historical irregular, fruitless and wasteful expenditure’. The partial exemption (which apparently also applies to Transnet) is intended to:
- ‘assist honest officials to fix an entity that has suffered from corruption’
- ‘break from its recent past’, and
- ‘reduce the scope for qualified audits’.
The document ends with a request for suggestions for ‘further reporting or governance arrangements’ that might ‘reduce the scope for corruption in state-owned entities’ and for ‘strengthening any exemptions’ deemed necessary in the circumstances.
- Treasury presentation
- Eskom exemption request
- Minister’s response
- exemption notice (attached to a separate notice on coinage, presumably in error)
- Treasury media statement
- joint National Assembly committee statement announcing briefing
Published by SA Legal Academy Policy Watch