International Consultative Seminar of the South African Legislative Sector 2011 Date: 17 March 2011 Topic: The contribution of Parliament and the South African Legislative Sector collective towards harnessing aid and global partnerships for development in South Africa and the Continent. By Hon. Des van Rooyen The aim of this paper is to assess and provide discussion points on the role that the South African Parliament and the Legislative Sector collective is playing in harnessing aid and partnerships both locally and in the Continent of Africa as a whole. The focus is on the oversight role and responsibilities of parliamentarians in law-making, monitoring and evaluation, facilitating public participation, and ensuring government accountability on matters relating to aid and international partnerships for development. Upfront in our discussion of this topic we need to recognize and accept the reality that aid and international partnerships are the most contested fields in international relations and development discourse. Underpinning the differences of views about aid in particular are issues of imbalances in power relations between the donor and recipient countries, the conditional ties attached to aid programmes which are assumed to lead to the loss of national sovereignty for receiving countries, a condition of dependency on foreign donors that is presumed to be created through aid provision for the benefit of donor countries’ self economic and geo-political interests. It has also been argued that aid benefits powerful domestic interest groups, contributes to corruption and because of the conditions attached to aid funding the money often goes back in the form of overpriced goods and services purchased by recipient countries from donor countries. On the positive side of the debate is the view that notwithstanding the challenges associated with aid or Official Development Assistance (ODA), there are a lot of countries who are poor, least developed and cannot survive without external assistance. Typically these countries are characterized by lack of the capacity and infrastructure to attract investment, increase production and expand trade, in other words their capacity for economic growth limited and constrained. Furthermore these countries lack are characterized by a general lack of skills and education, high levels of poverty, economic vulnerability and poor health. In this view ODA is seen as a mutually beneficial process and necessary part of an increasingly globalised world shaped by interdependence, international trade and 1 politics. The assumption has been that provision of aid to developing and poor countries would lead to economic take off, growth and development. The aim of aid is accordingly to promote growth and reduce the levels of poverty in recipient countries. In this context ODA is seen as part of international relations and acceptance of nations’ international obligations towards addressing common problems, especially within the framework of multilateral agencies such as the United Nation Institutions. This Seminar today seeks to promote the role of Parliament and the Legislative Sector in the implementation of the Millennium Development Goal number 8 which focuses on the development of global partnerships for development. The choice of this topic is particularly relevant and appropriate for our country at this juncture because of our government priority to reduce poverty, advocate for a new order in the global financial and trade system, and implementing programmes and strategies for decent work and job creation. The country’s priorities are consistent with this Goals’ aims of among others to: Develop further an open, rule-based, predictable, nondiscriminatory trading and financial system (includes a commitment to good governance, development, and poverty reduction- both nationally and internationally) In cooperation with developing countries, develop and implement strategies for decent work and productive work for youth and In cooperation with pharmaceutical companies, provide access to affordable essential drugs in developing countries. I have chosen these three aims of the Millennium Development Goal on global partnership for development to illustrate the importance of having ODA that is rooted within the recipient country’s own developmental agenda and priorities rather than being determined by the donor countries. South Africa’s position as a recipient of ODA has undergone changes since liberation in 1994. The dawn of democracy led to an increase in the ODA inflows into the country especially in support for the strengthening of democratic institutions and the Reconstruction and Development Programme (RDP). This included this European Union supported programme of strengthening the South African Legislative Sector. South Africa’s economic development ranking has since changed to be classified as a middle-income country and therefore is no longer seen as a priority need for ODA by many donor countries. The growing strength of the South African economic position and its democratic credentials has not only led to a decrease in the flow of ODA but also to the country providing ODA to other countries especially in the SADC region. Most of such aid would be embedded within country cooperation agreements. An example of these would be the SACU agreements which are based on a need take into consideration the developmental imbalances between South Africa and its partners. As a result of its strength the country is also playing an increasingly major strategic role in global development, economic and political institutions 2 whereby it is advocating for fair international relations and equity between the developing and developed countries, especially with regard to trade and the transformation of the International Finance Institutions and the United Nations. An example of this is the role South Africa is playing in the WTO talks in advocating for better deals in favour of African and other developing countries of the South. In all these processes Parliament and the Legislative Sector has a crucial role to play with regard to oversight, monitoring and evaluation, ensuring public participation and holding government to account. Parliament and Provincial Legislature’s role and contribution towards aid and international partnerships for development cannot be separated from the general principles and responsibilities as stipulated in the Constitution of the Republic. The describes the functions of Parliament as among others “to provide mechanisms to ensure that all executive organs of state in the national sphere of government are accountable to it; and to maintain oversight of the exercise of national authority, including the implementation of legislation and any organ of state”. In addition, Parliament facilitates public participation, involvement and transparency; facilitates co-operative government; facilitates international participation; and represents the interests of the people. (Parliament Oversight and Accountability Document) Constitutionally negotiations and implementation of ODA is the responsibility of government. Parliament and Legislatures contribute through their monitoring and evaluation, oversight, legislative and facilitation of public participation roles. As a matter of principle and policy for South Africa, ODA must be aligned to the country’s core development priorities, and managed effectively and efficiently in support of South Africa’s chosen developmental path. South Africa’s strategic approach to ODA is that it should be based on the principles of mutually beneficial partnership for sustainable development for the partners involved, South Africa takes full ownership of donor-supported interventions, both at a macro- and sector level, and in all spheres of government. It also takes full responsibility for meeting the governance, policy and capacity requirements that would enable it to achieve sustainable development. Furthermore to ensure transparency and accountability in ODA South Africa takes responsibility together with the international donor community to establish and maintain an effective and efficient ODA management system. This system has been established in the country and is being maintained in the National Treasury. The design of the South African State machinery is such that there are a number of Departments and Institutions which have ODA funding for their programmes and they are responsible for implementation and accountability. The National Treasury would for reasons of fiscal and revenue management purposes have a 3 central point of coordination. It is responsible for the overall co-ordination of ODA at a macro/ supra-sectoral level, and assisting in ODA co – ordination at sector/ implementing agency level according to specific requirements. In doing so it has a responsibility for: ODA policy development, guidelines, processes and procedures Overall management processes of interaction between South Africa and donors Ensuring alignment between ODA programmes and MTEF, and national development priorities Overall ODA monitoring and evaluation, and Centralized ODA information management Based on this therefore it means the Minister of Finance is politically responsible for the overall management of ODA, interpretation and articulation of overall development priorities as they relate to ODA. Other departments with key responsibilities in the process of ODA besides respective implementing agencies are the Presidency, International Relations and Co-operation, Justice, Home Affairs and SARS. Parliament and Legislatures have a responsibility to ensure that ODA commitments are implemented according to the letter of the agreements and that the money is used for what it was intended for through signed contracts. In the South African system Parliament and Legislatures within their legislative mandate they scrutinize and ratify International Protocols and would therefore deal with ODA. In the main the South African Parliament and Legislatures play a role of harnessing aid and global partnership for development by: Scrutinizing all relevant legislation that governs ODA such as the RDP Fund Act as amended; PFMA as amended and relevant Treasury Regulations; Value-added Tax Act as amended; Customs and Excise Act as amended; Income Tax Act as amended; and Preferential Policy Framework Act Scrutinizing departments’ strategic plans for aid related projects and funding to be able to ensure compliance with protocols, national priorities and accountability requirements for oversight purposes Scrutinizing departments’ annual reports to assess compliance with aid protocol agreements for the purpose of ensuring accountability Call and Summon departments and institutions to account for performance on aid related programmes as well as assessing their alignment with Millennium Development Goals In terms of progress on the oversight roles: Parliament have so far play an important role in ensuring public participation in development aid through its Committee hearing processes 4 Parliament and Legislatures have taken interest in scrutinizing audit reports on donor funding and ensuring accountability from those departments institutions The sector as a collective has forged relations with similar institutions such as the IPU, European Union, SADC and Pan- African Parliament. These relations provide platforms for solidarity, mutual learning and an expression of mutual interdependence. It can be argued that it has been as a result of the role of Parliament and Legislatures that Civil Society in South Africa has been able to access information on aid supported government programmes and therefore ensure public scrutiny and accountability. Notwithstanding this progress the following challenges are still prevalent: weak systems and processes of co-ordination between the Executive, Parliament and the Legislative Sector on ODA for accountability purposes, for example there were difficulties in processing the African Peer Review Mechanism Report and the Report on the Millennium Development Goals implementation by Parliament and the Legislatures lack of appropriate mechanisms for the involvement of Parliament and the Legislative Sector at the initiation and design phase of ODA with regard to national development priorities ODA especially from the EU is still tied up with conditions ODA related to the Bretton Woods Institutions is still full of conditionalities which are detrimental to the recipient countries In going forward Parliament and the Legislative Sector would need to strengthen on their role at the initiation level of aid agreements so as to unsure consistency with the priorities of the Millennium Goals if the country is meeting them within agreed targets. They also need to play a bigger advocacy role through their international partnership platforms to call for reforms in ODA policies, management and the Bretton Woods Institutions because of their influence on world ODA. 5