Public Finance Management Act

2 Maart 1999 It is hereby notified that the President has assented to the following Act which is hereby published for general information:— Hierby word bekend gemaak dat die President sy goed- keuring geheg het aan die onderst~ande Wet wat hierby ter algemene irrligting gepubliseer word:— No. 1 of 1999: Public Finance Management Act, 1999. No. 1 van 1999: \Vet op Openb~re Finansiele Bestuur. 1999. (EIIgl;sll tf.~t signed by tlze President.) (As.setltcd to 2 Marclz 1999. ) ACT To regulate financial management in the national government; to ensure that all revenue, expenditure, assets and liabilities of that government are managed efficiently and effectively; to provide for the responsibilities of persons entrusted with financial management in that government; and to provide for matters connected therewith. B E IT ENACTED by the Parliament of the Republic of South Africa, as follows:— ARRANGEMENT OF SECTIONS CHAPTER 1 INTERPRETATION. OBJECT, APPLICATION AND AMENDMENT OF “THIS ACT 5 1. 2. 3. 4. Definitions Object of this Act Institutions to which this Act applies Amendments to this Act CHAPTER 2 NATIONAL TREASURY AND NATIONAL REVENUE FUND Part 1: National Treasury Establishment Functions and powers Banking, cash management and investment framework Annual consolidated financial statements Financial statistics and ag&regations Delegations by National Treasury Part 2: National Revenue Fund Control of National Revenue Fund Deposits and withdrawals by South African Revenue Services in Revenue Funds Deposits into National Revenue Fund Withdrawal of exclusions Withdrawals and investments from National Revenue Fund Use of funds in emergency situations 5. 6. 7. 8. 9. 10. 11. 12. 13. 14, 15. 16. CHAPTER 4 NATIONAL BUDGETS 26. Annual appropriations 15 25 30 J 4 No. 19814 (; OVI;RX>IENT GAZ13~E, 2 N!ARCH 19~)9 .!ct N(). 1. 199Y P[’BLIC FINANCE NI.4NAGEMENT ACT. 1999 27. 28. 29, 30. 32. 33. 34. National budgets Multi-year budget projections Expenditure before annual budget is passed National adjustments budget Publishing of reports on state of budget Withholding of appropriated funds Unauthorised expenditure CHAPTER 5 DEPARTMENTS AND CONSTITUTIONAL INSTITUTIONS Part 1: Appointment of accounting oficers 36. 37. Accounting oficers Acting accounting officers Par( 2: Responsibilities of accounting oficers 38. 39. 40. 41. 42. 43. General responsibilities of accounting officers Accounting officers’ responsibilities relating to budgetary control Accounting officers’ reporting responsibilities Information to be submitted by accounting officers Accounting officers’ responsibilities when assets and liabilities are transferred Vlrement between main divisions within votes Part 3: Other oflcials of departments and constitutional institutions 44. 45. Assignment of powers and duties by accounting officers Responsibilities of other officials CHAPTER 6 PUBLIC ENTITIES Part 1: Application of this Chapter Application Unlisted public entities Classification of public entities Part 2: Accounting authorities for public entities Accounting authorities Fiduciary duties of accounting authorities General responsibilities of accounting authorities Annual budget and corporate plan by Schedule 2 public entities and government business enterprises Annual budgets by non-business Schedule 3 public entities Information to be submitted by accounting authorities Annual reports and financial statements 46. 47. 48. 49. 50. 51. 52. 53. 54. 55. Part 3: Other oficials of public entities 56. 57. Assignment of powers and duties by accounting authorities Responsibilities of other officials Part 4: External auditors 58. 59. 60. Appointment of auditors Discharge of auditors Duties and powers of auditors 10 15 20 25 30 35 40 (> \,) IYSIJ G()\”l:RNMl:NT GAZETTE. 2 NI.4RCH 1009” ,icl No. 1, 199Y PL”BLIC FIN.ANCE N1.\X.4GENlENT .\ CT, 199Y 61. 62. Reports of audi[or Duties and powers of Auditor-General CHAPTER 7 EXECUTIlzE AUTHORITIES 63. 64. 65. Financial responsibilities of executive authorities Executive directives having financial implications Tabling in legislatures CHAPTER 8 LOANS, GUARANTEES AND OTHER COMMITMENTS Part 1: General principles Restrictions on borrowing, guarantees and other commitments Consequences of unauthorised transactions Regulations on borrowing by public entities Guarantees, indemnities and securities by Cabinet members Part 2: bans by national government Purposes for which Minister may borrow money Signing of loan agreements Interest and repayments of loans to be direct charges Repayment, conversion and consolidation of loans Obligations from lien over securities CHAPTER 9 GENERAL TREASURY MATTERS Treasury regulations and instructions Audit committees Publishing of draft treasury regulations for public comment Departures from treasury regulations, instructions or conditions Determination of interest rates for debt owing to state 66. 68. 69. 70. 71. 72. 73. 74. 75. 76. 77. 78. 79. 80. CHAPTER 10 F~ANCML MISCONDUCT Part 1: Disciplinary proceedings 81. 82. 83. 84. 85. Financial misconduct by officials in departments and constitutional institutions Financial misconduct by treasury officials Financial misconduct by accounting authorities and officials of public entities Applicable legal regime for disciplin~ proceedings Regulations on financial misconduct procedures Part 2: Criminal proceedings 86. Offences and penalties CHAPTER 11 ACCOUNTING STANDARDS BOARD 87, Establishment 10 15 20 25 30 35 40 x A(1. IYX14 G()\’I:RNJII:NT GAZETTE. 2 \lARCH 1999 :tct N(). 1. lYYY I’l” BI.IC FIS4SCE \l:4S.AGENIEh’T 4CT. 1999 S8. Composition

89. Functions of Board 90.

91. Regulations on accounting standards of Board Powers of Board CHAPTER 12 hlISCELLANEOUS

90. The Accounting Standards Board may do all that is necessay or expedient to 40 perform (a) (b) (c) (d) (e) m (g) (h) its functions effectively, which includes the power t% determine its own staff establishment and appoint employees to posts on its staff establishment; obtain the services of any person or entity to perform any specific act or function; confer with any person or entity; acquire or dispose of any tight in or to property, but ownership in immovable property may be acquired or disposed of only with the consent of the Minister; insure itself against any loss, damage, risk or liability; perform legal acts, or institute or defend any legal action in its own name; 50 do research and publish reports; and do anything that is incidental to the exercise of any of its powers. 45 04 ho, IY814 Act No. 1$1999 P~TBLIC m~,~~CE MANAGEMENT ACT. t 9Y9 G O V E R N M E N T GAAE”l-J’k. L MAKLH IYYY Regulations on accounting standards of Board 91. (1) The Minister, after consulting the Auditor-General, may m~e regulations— (a) concerning the qualifications, remuneration, term of office and removal of members of the Accounting Standards Board, the filling of vacancies, the chairperson of the Board, and the finances and administration of the Board; 5 (b) prescribing the standwds set by the Board in terms of section 89; and (c) concerning any other matter that may facilitate the proper functioning of the Board or the implementation of those standards. (2) The Minister must consult the Board on the implementation date of a regulation made in terms of subsection (1)(b). (3) Different regulations may be made in terms of subsection (1)(b) for different categories of institutions to which the standards set in terns of section 89 apply. (4) Draft regulations prescribing standards in terms of subsection (1)(b) must be published for public comment in the national Government Gazette before their enactment. 10 15 C~PTER 12 MISCELLANEOUS Exemptions

92. The Minister, by notice in the national Government Gazette, may exempt any institution to which this Act applies, or any category of those institutions, from any 20 specific provisions of this Act for a period determined in the notice. Transitional provisions 93. (1) Anything done in terms of a provision of the Exchequer Act, 1975 (Act No. 66 of 1975), which can be done in terms of a provision of this Act, must be regarded as having been done in terms of this Act. 25 (2) All treasury regulations and instructions made or issued in terms of the Exchequer Act, 1975, remain in force until repealed in terms of section 76 of this Act. (3) Until the Accounting Standards Board is established, the National Treasury may perform the functions of the Board. (4) The provisions of the Revenue Funds Interim Amangements Act, 1997 (Act No. 95 30 of 1997), despite the fact that they have lapsed, must be regarded as forming part of this Act until 1 April 2000. Repeal of legislation

94. The legislation mentioned in Schedule 6 is repealed to the extent specified in the third column. Short title and commencement

95. This Act is called the Public Finance Management Act, 1999, and t&es effect on 1 April 2000 except— (a) Chapter 11 and section 93(4), which tke effect on the date of publication of this Act; and (b) those provisions determined by the Minister by notice in the national Government Gazette, which will t&e effect on a date determined in the notice, but which may not be a date later than 1 April 2003. 35 40 (>() .\,) IYN14 \, .,, , .!.!...,!,’., . . . . . . . . . . . . - . . . . . . . . .tct No. 1.1999 PL’BI.IC FIS.AXCE hfAN,\GE,MENT .ACT. 1099 SCHEDULE 1 CONSTITUTIONAL INSTITUTIONS 1. 2. 3. 4. 5. 6. 7. 8. 9. 10, The Public Protector. The Human Rights Commission. The Commission for the Promotion and Protection of the Rights of Cultural, Religious and Linguistic Communities. ‘ The Commission for Gender Equality. The Independent Electoral Commission. The Independent Broadcasting Authority. The Financial and Fiscal Commission. The Commission on the Remuneration of Persons Holding Public Office. The Pan South African Language Board. The Municipal Demarcation Board. SCHEDULE2 NIAJOR PUBLIC ENTITIES 1. 2. 3. 4, 5 6: 7. 8. 9. 10. 11, 12. 13. 14. 15. 16. 17. 18. 19. 20. Air Tmffic and Navigation Services Company Ai~orts Company Alexander Bay Development Corporation Armaments Corporation of South Africa Atomic Energy Corporation of South Africa Limited Centrdl Energy Fund DENEL Development Bank of Southern Africa ESKOM Independent Development Trust Industrial Development Coloration of South Africa Limited Land and Agricultural Bank of South Africa SA Abattoir Corporation SA Broadcasting Commission SA Forestry Company Limited SA Post Ofice Limited Telkom SA Limited Transnet Limited Trans-Caledon Tunnel Authority Any subsidiary or entity under the ownership control of the above public entities /(1 ..(,. If’.,+ ,\ct N{). 1. 1999 P1”BLIC FIS.+SCE \l,\S.4GEMENT ,4 Cr. 19Y9 SCHEDULE3 OTHER PUBLIC ENTITIES Part A: National Public Entities 1. 7-. 3 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42 43. 44. 45. 46. 47. Accounting Standards Board Agricultural Credi[ Board Agricultural Reseach Council Air Services LicensinE Council Board on Tariffs and Trade Competition Board Certification Council for Technikon Education Commission for Conciliation, Mediation & Arbitration Compensation Board Council for Geoscience Council for Mineral Technology (Mintek) Council for Nuclear Safety Council for Scientific and Industrial Research Financial Services Board Human Sciences Research Council Judicial Services Commission Legal Aid Board National Agriculture Marketing Council National Economic, Development and Labour Council National Electricity Regulator National Film Board National Housing Bowd National Housing Finance Co~oration National Monuments Council National Parks Board National Road Fund National Small Business Council National Youth Commission Road Accident Fund SA Bureau of Standards SA Certification Council SA Civil Aviation Authority SA Housing Development Board SA Housing Fund SA Housing Trust Limited SA Medical Research Council SA Qualifications Authority SA Revenue Service SA Road Board SA Road Safety Council SA Telecommunications Regulatory Authority SA Tourism Board State Information Technology Agency Unemployment Insurance Fund Wage Board Water Research Commission Any subsidiary or entity under the ownership control of the above public entities Part B: National Government Business Enterprises Albaniekus Waterraad Bala-Bala Farms (Pty) Ltd Bloem Water Bosveld Waterraad 1. 2. 3. 4.

93. Transitional provisions

94. Repeal of legislation

95. Short title and commencement SCHEDULES CHAPTER 1 INTERPRETATION, OBJECT, APPLICATION AND AMENDMENT OF THIS ACT Definitions

1. In this Act, unless the context otherwise indicates— “accounting oficer” means a person mentioned in section 36; “accounting authority” means a body or person mentioned in section 49; “Accounting Standards Board” means the board established in terms of section 87; “annual Division of Revenue Act” means the Act of Parliament which must annually be enacted in terms of section 214(1) of the Constitution; “constitutional institution” means an institution listed in Schedule l; “department” means a national department; “executive authority”- (a) in relation to a national department, means the Cabinet member who is accountable to Parliament for that department; and (b) in relation to a national public entity, means the Cabinet member who is accountable to Parliament for that public entity or in whose portfolio it falls; “financial year”- (a) means a year ending 31 March; or (b) in relation to a national public entity that existed when this Act took effect and that has a different financial year in terms of other legislation, means that financial year, provided the National Treasury has approved that other financial year; 5 10 15 20 25 30 35 “financial statements” means statements consisting of at least— (a) a balance sheet: (b) an income statement; (c) a cash-flow statement; (d) any other statements that may be prescribed; and (e) any notes to these statements; “fruitless and wasteful expenditure” means expenditure which was made in vain and would have been avoided had reasonable care been exercised; “generally recognised accounting practice” means an accounting practice complying in material respects with standards issued by the Accounting Standards 45 Board; “irregular expenditure” means expenditure, other than unauthorised expendi- ture, incurred in contravention of or that is not in accordance with a requirement of any applicable legislation. including— (a) this Act; or (b) the State Tender Board Act, 1968 (Act No. 86 of 1968), or any regulations 50 40 made in terms of that Act; “main division within a vote” me~s one of the main segments into which a vote is divided and which— (u) specifies the total amount which is appropriated for the items under that segment: and (/J) is approled by Parliament as part of the vote: “Minister’. means the Minister of Finance; “national department.’ means— (u) a department lis[ed in Schedule 1 of the Public Service Act, 1994 (Proclamation No. 103 of 1994), but excluding a provincial administration; or 5 (b) an organisational component listed in Schedule 3 of that Act; “national government business enterprise” means an entity which— (a) is a juristic person under the ownership control of the national executive; 10 (b) has been assigned financial and operational authority to carry on a business activity; (c) as its principal business. provides goods or services in accordance with ordinary business principles: and (d) is financed fully or substantially from sources other than— 15 (i) the National Revenue Fund; or (ii) by way of a tax, le~y or other statutory money; “national public entity” means— (a) a national government business enterprise; or (b) a board, commission, company, corporation, fund or other entity (other than a 20 national government business enterprise) which is— (i) established in terms of national legislation ; (ii) fully or substantially funded either from the National Revenue Fund, or by way of a tax, levy or other money imposed in terms of national legislation: and (iii) accountable to Parliament: “National Treasury” means the National Treasury established by section 5; “overspending”- (a) in relation to a vote, means when expenditure under the vote exceeds the amount appropriated for that vote; or 25 30 (b) in relation to a main division within a vote, means when expenditure under the main division exceeds the amount appropriated for that main division, subject to section 43; “ownership control “, in relation to an entity, means the ability to exercise any of the following powers to govern the financial and operating policies of the entity in 35 order to obtain benefits from its activities: (u) To appoint or remove all, or the majority of, the members of that entity’s board of directors or equivalent governing body; (b) to appoint or remove that entity’s chief executive officer; (c) to cast all, or the majority of, the votes at meetings of that board of directors 40 or equivalent governing body; or (d) to control all, or the majority of, the voting rights at a general meeting of that entity; “prescribe” means prescribe by regulation or instruction in terms of section 76: “public entity” means a national public entity; “Revenue Fund” means— (a) the National Revenue Fund mentioned in section 213 of the Constitution; “this Act” includes any regulations and instructions in terms of section 69,76, 85 or 91; “trading entity.’ means an entity operating within the administration of a 50 department for the provision or sale of goods or services, and established— (u) in the case of a national department, with the approval of the National 45 Treasury; “treasury” means the National Treasury; “unauthorised expenditure” means— (a) overspending of a tote or a main division within a vote; (b) expenditure not in accordance with the purpose of a vote or, in the case of a main division, not in accordance with the purpose of the main division; “vote” means one of the main segments into which an appropriation Act is divided and which- (u) specifies the total amount which is usually appropriated per department in an ‘ 55 . 60 appropriation Act; and \ct so. 1.1999 P~”R1.1(” FIX i\C[; .ll,.\X.LIGf:\lEKT ,4CI. l~)oc) (II) is separately approved b! Parliament before it approves tbe relevant drof[ ~ppropriiltiotl” Act ai SUCII, Object of this Act

2. The object of this Act is to secure transparency, accountability. and sound management of the revenue, expenditure, assets and liabilities of the institutions to which this Act applies. 5 Institutions to which this Act applies 3. ( 1 j This Act, to the extent indicated in the Act, applies to— (a) departments; (b) public entities listed in Schedule 2 or 3; (c) constitutional institutions: and (d) Parliament, subject to subsection (2). (~) To the extent that a provision of this Act applies t~ (a) Parliament, any controlling and supervisory functions of the National Treasury in terms of that provision are performed by the Speaker of the National Assembly and the Chairperson of the National Council of Provinces, acting jointly. (3) In the event of any inconsistency between this Act and any other legislation, this Act prevails. Amendments to this Act 10 15 20

4. Draft legislation directly or indirectly amending this Act, or providing for the enactment of subordinate legislation that may conflict with this Act, may be introduced in Parliament— (a) by the Minister only; or (b) only after the Minister has been consulted on the contents of the draft 25 legislation. CHAPTER 2 NATIONAL TREASURY AND NATIONAL REVENUE FUND Part 1: NatioItal Treasuq Establishment 5. (1) A National Treasury is hereby established, consisting of— (a) the Minister, who is the head of the Treasury; and (b) the national department or departments responsible for financial and fiscal matters. (2) The Minister. as the head of the National Treasury, takes the policy and other decisions of the Treasury, except those decisions taken as a result of a delegation or instruction in terms of section 10. Functions and powers 6. (1) (a) (b) (c) (d) (e) (f) (x) The National Treasury must— promote the national government’s fiscal policy framework and the co- ordination of macro-economic policy; co-ordinate intergovernmental financial and fiscal relations; manage the bud&et preparation process; exercise control over the implementation of the annual national budget, including any adjustments budgets; facilitate the implementation of the annual Division of Revenue Act; monitor the implementation of provincial budgets; promote and enforce transparency and effective management in respect of revenue, expenditure, assets and liabilities of departments, public entities and constitutional institutions; and 30 35 40 45 50 (~i) ptrform the other functions assigned to the National Tre:tsury in terms of this Act. (2) To the extent necessary to perform the functions mentioned in subsection ( 1). the National Treasury— ((i) must prescribe uniform treasury norms and standards; (/7) must enforce this Act and any prescribed norms and standards, including any prescribed standards of generally recognised accounting practice and uniform classification systems. in national departtnents; (c) must monitor and assess the implementation of this Act. including any 5 prescribed norms and standards. in national public entities and in constitu- 10 tional institutions; (d) may assist departments and constitutional institutions in building their capacity for efficient, effective and transparent financial management; (e) may investigate any system of financial mana&ement and internal control in any department, public entity or constitutional institution; (~) must intervene by taking appropriate steps, which may include steps in terms of section 100 of the Constitution or the withholding of funds in terms of section 216(2) of the Constitution, to address a serious or persistent material breach of this Act by a department, public entity or constitutional institution; and (g) may do anythin& further that is necessary to fulfil its responsibilities effectively. (3) Subsections (1) (g) and (2) apply to public entities listed in Schedule 2 only to the extent provided for in this Act. Banking, cash management and investment framework 15 20 25 7. (1) The National Treasury must prescribe a framework within which departments, public entities listed in Schedule 3 and constitutional institutions must conduct their cash management. (2) A department authorised to open a bank account in terms of the prescribed framework, a public entity or a constitutional institution may open a bank account 30 o n l y- (a) with a bank registered in South Africa and approved in writing by the National Treasury; and (b) after any prescribed tendering procedures have been complied with. (3) A department, public entity listed in Schedule 3 or constitutional institution may 35 not open a bank account abroad or with a foreign bank except with the written approval of the National Treasury. (4) The National Treasury may prescribe an investment policy for public entities, constitutional institutions and those departments authorised to open a bank or other account in terms of the prescribed framework. (5) A bank which has opened a bank account for a department, a public entity listed in Schedule 3 or a constitutional institution, or any other institution that holds money for a department, a public entity listed in Schedule 3 or a constitutional institution, must promptly disclose information regarding the account when so requested by the National Treasury or the Auditor-General. 40 45 Annual consolidated financial statements 8. ( 1 ) The National Treasu~ must— (a) prepare consolidated financial statements in accordance with generally recognised accounting practice for each financial year in respect of— (i) national departments; (ii) public entities under the ownership control of the national executive; (iIi) constitutional institutions: (iv) the South African Reserve Bank; (Y) the Auditor-General: and (vi) parliament: and (17) submit those statements for audit to the Auditor-General within three months after the end of that financial year. 50 . 55 (2) The Auditor-General must audit the consolidated financial statements and submit an audit report on the statements to the National Treasury within three months of receipt of the statements. (3) The Minister must submit the consolidated financial statements and the audit report on those statements within one month of receiving the report from the 5 Auditor-General, to Parliament for tabling in both Houses. (4) The consolidated financial statements must be made public when submitted to Parliament. (5) If the Minister fails to submit the consolidated financial statements and the Auditor-General’s audit report on those statements to Parliament within seven months 10 after the end of the financial year to which those statements relate— (a) the Minister must submit to Parliament a written explanation setting out the reasons why they were not submitted; and (b) the Auditor-General may issue a special report on the delay. Financial statistics and aggregations

9. The National Treasury may annually compile in accordance with international standards, and publish in the national Goverizment Gazette, financial statistics and aggregations concerning aIl spheres of government. Delegations by National Treasury 10. (1) The Minister may— 15 20 (a) in writing delegate any of the powers entrusted to the National Treasury in terms of this Act, to the head of a department forming part of the National Treasury, or instruct that head of department to perform any of the duties assigned to the National Treasury in terms of this Act. (2) A delegation, instruction or request in terms of subsection (1) to the head of a 25 department forming part of the National Treasury— (a) is subject to any limitations or conditions that the Minister may impose; (b) may authorise that head, in the case of subsection (l)(a)— (i) to sub-delegate, in writing, the delegated power to another National Treasury official, or to the holder of a specific post in the National 30 Treasury, or to the accounting officer of a constitutional institution or a department, or to the accounting authority for a public entity; or (ii) to instruct another National Treasury official, or the holder of a specific post in the National Treasury, or the accounting officer for a constitu- tional institution or a department, or the accounting authority for a public 35 entity, to perform the assigned duty; and (d) does not divest the Minister of the responsibility concerning the exercise of the delegated power or the performance of [he assigned duty. (3) The Minister may confirm, vary or revoke an> decision taken by the head of a department forming part of the National Treasury, as a result of a delegation, instruction 40 or request in terms of subsection (1)(a), or by a treasury otTicial or accounting officer or accounting authority as a result of an authorisation in terms of subsection (2)(b), subject to any rights that may have become vested as a consequence of the decision. Part 2: Natio~tal Revenue FuItd Control of National Revenue Fund 45 11. (1) The National Treasury is in charge of the National Revenue Fund and must enforce compliance with the provisions of section 213 of the Constitution, namely that— )\ct K(). 1.1999 P[”B[. [c Fr\’,4NcE NtANAGl;NlENT.AcT. 1999 (a) ail money received by the national government must be paid into the Fund. except money reasonably excluded by this Act or another Act of Parliament: and (b) no money may be withdrawn from the Fund except— (i) in terms of an appropriation by an Act of Parliament; or (ii) as a direct charge against the Fund, subject to section 15(1 )(a)(ii). (2) Draft legislation that provides for a withdrawal from the National Revenue Fund as a direct charge against the Fund, may be introduced in Parliament only after the Minister has been consulted and has consented to the direct charge. (3) Money that must be paid into the National Revenue Fund is paid into the Fund by depositin& it into a bank account of the Fund in accordance with any requirements that may be prescribed. (4) The National Treasury ~ust establish appropriate and effective cash management 5 10 and banking arrangements for the National Revenue Fund. (5) The National Treasury must ensure that there is at all times suficient money in the 15 National Revenue Fund. Deposits and withdrawals by South African Revenue Services in.Revenue Funds 12. (1) The South African Revenue Services must promptly deposit into a Revenue Fund all taxes, levies, duties, fees and other moneys collected by it for that Revenue Fund, in accordance with a framework determined by the National Treasury. (2) The South African Revenue Services may, despite section 15(1), withdraw money from the National Revenue Fund— (a) to refund any tax, levy or duty credits or any other charges in connection with taxes, levies or duties; (b) to make other refunds approved by the National Treasury; or (c) to transfer to a member of the South African Customs Union any money collected on its behalf. (3) The National Treasury must promptly transfer all taxes, levies, duties, fees and other moneys collected by the South African Revenue Services for a province and deposited into the National Revenue Fund, to that province’s Provincial Revenue Fund. (4) Withdrawals in terms of subsection (2) or (3) are direct charges against the National Revenue Fund. Deposits into National Revenue Fund 13. (1) All money received by the national government must be paid into the National Revenue Fund, except money received by— (a) (b) (c) (d) (e) (f) - - Parliament; a national public entity: the South African Reserve Bank; the Auditor-General: the national government from donor agencies which in terms of ’legislation or the agreement with the donor, must be paid to the Reconstruction and Development Programme Fund; a national department— (i) operating a trading entity, if the money is received in the ordinary course of operating the trading entity; (ii) in trust for a specific person or category of persons or for a specific purpose; (iii) from another department to render an agency service for that department; or (s) (iv) if the money is of a kind described in Schedule 4; or a constitutional institution— (i) in tmst for a specific person or category of persons or for a specific purpose; or (ii) if the money is of a kind described in Schedule 4. 20 25 30 35 40 45 50 /\ct No. 1. 1999 P(BLIC FIXANCE MANAGEh4ENT ACT. 1999 (2) The exclusion in subsection (1 )(b) does not apply to a national public entity which is not listed in Schedule 2 or 3 but which in terms of section 47 is required to be listed. (3] Draft ]egisIation that excludes money from payment into the National Revenue Fund may be introduced in Parliament only after the Minister has been consulted on the 5 reasonableness of the exclusion and has consented to the exclusion. (4) Any legislation inconsistent with subsection (1) is of no force and effect to the extent of the inconsistency. (5) Money received by Parliament, a national public entity listed in Schedule 2 or 3, the South African Reserve Bank or the Auditor-General must be paid into a bank account 10 opened by the institution concerned. Wthdrawal of exclusions 14. (1) The National Treasury may withdraw, from a date determined by it, any exclusion granted to a national department, a constitutional institution or a national public entity in terms of section 13(l), either with regard to all money or with regard to 15 money of a specific kind received by that department, constitutional institution or public entity, if— (a) the exclusion is not reasonable within the context of section 213 of the Constitution; or (b) the National Treasury regards the withdrawal of the exclusion to be necessary 20 for transparency or more effective and accountable financial management. (2) The exclusion in terms of section 13(1) of the following public entities may not be withdrawn: (a) A national government business enterprise which is a company and in which the state is not the sole shareholder; and (b) the national public entities listed in Schedule 2. 25 (3) From the date on which the withdrawal of an exclusion in terms of subsection (1) takes effect until the end of the relevant financial year, the National Treasury may transfer money from the National Revenue Fund, as a direct charge against the Fund, to the national department or public entity affected by the withdrawal, provided that the 30 amount of the transfer does not exceed the amount that would otherwise have been excluded from payment into the Fund. (4) The Minister must promptly inform Parliament of any withdrawal of an exclusion in terms of subsection (1). Withdrawals and investments from National Revenue Fund 35 15. (1) Only the National Treasury may withdraw money from the National Revenue Fund, and may do so only— (a) to provide funds that have been authorised— (i) in terms of an appropriation by an Act of Parliament; or (ii) as a direct charge against the National Revenue Fund provided for in the 40 Constitution or this Act, or in any other Act of Parliament provided the direct charge in such a case is listed in Schedule 5; (b) to refund money invested by a province in the National Revenue Fund; or (c) to refund money incorrectly paid into, or which is not due to, the National Revenue Fund. 45 (2) A payment in terms of subsection (1 )(b) or (c) is a direct charge against the National Revenue Fund. (3) (a) The Nationrd Treasury may invest temporarily, in the Republic or elsewhere, money in the National Revenue Fund that is not immediately needed. (b) When money in the National Revenue Fund is invested, the investment, including 50 . interest earned, is regarded as part of the National Revenue Fund. Use of funds in emergency situations 16. (1) The Minister may authotise the use of funds from the Nationrd Revenue Fund 22 s,). IYS14 G()\’F.RN\tEXT G.4ZETTE.2 M/\RCt+ IY99 .4ct No. 1.19Y9 PC’BLfC FISANCE \f.AN.4GE\lENT ACT. lYYY to defray expenditure of an exceptional nature which is currently not provided for and which cannot, without serious prejudice to the public interest, be postponed to a future parliamentary appropriation of funds. (2) The combined amount of any authorisations in terms of subsection ( 1), may not exceed two per cent of the total amount appropriated in the annual national budget for 5 the current financial year. (3) An amount authorised in terms of subsection (1) is a direct charge against the National Revenue Fund. (4) An amount authorised in terms of subsection (1) must— (a) be reported to Parliament and the Auditor-General within 14 days, or if the 10 funds are authorised for the deployment of the security services, within a period determined by the President; and (b) be attributed to a vote. (5) A report to Parliament in terms of subsection (4)(a) must be submitted to the National Assembly for tabling in the Assembly and made public. (6) Expenditure in terms of subsection (1) must be included either in the next adjustments budget for the financial year in which the expenditure is authorised or in other appropriation legislation tabled in the National Assembly within 120 days of the Minister authorizing the expenditure, whichever is the sooner. CHAPTER 4 NATIONAL BUDGETS Annual appropriations

26. Parliament must appropriate money for each financial year for the requirements of the state. National annual budgets 15 20 25 27. (1) The Minister must 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 after the start of that financial year, as the Minister may determine. (3) An annual budget must be in accordance with a format as may be prescribed, and 30 must at least contain— (a) estimates of all revenue expected to be raised during the financial year to which the budget relates; (b) estimates of current expenditure for that financial year per vote and per main division within the vote; 35 (c) estimates of interest and debt servicing charges, and any repayments on loans; (d) estimates of capital expenditure per vote and per main division within a vote for that financial year and the projected financial implications of that expenditure for future financial years; (e) estimates of revenue excluded in terms of section 13(1) from the Revenue 40 Fund for that financial year; ~) estimates of all direct charges against the Revenue Fund and standing appropriations for that financial year; (g) proposals for financing any anticipated deficit for that financial year; (/1) an indication of intentions regarding bomowing and other forms of public 45 liability that will increase public debt during that financial year and future financial years; (i) the projected— (i) revenue for the previous financial year; (ii) expenditure per vote, and per main division within the vote, for the 50 previous financial year; and (iii) borrowing for the previous financial year; and (j) any other information as may be prescribed, including any multi-year budget information. (4) When the annual budget is in~oduced in the National Assembly, the accounting 55 officer for each department must submit to Parliament measurable objectives for each 24 No. 19X14 GO\ ’ERNMENT GAZEmE. 2 MARCH 1999 Act No. 1.1999 PL-B[.IC FISANCE MANAGEMENT ACT, 1999 main division within the department’s vote. The treasury may co-ordinate these submissions and consolidate them in one document. Multi-year budget projections 28. (1) The Minister must annually table in the National Assembly a multi-year budget projection of— 5 (a) the estimated revenue expected to be raised during each year of the multi-year period; and (b) the estimated expenditure expected to be incurred per vote during each year of the multi-year period, differentiating between capital and current expenditure. (2) A multi-year budget projection tabled by the Minister must contain the 10 Minister’s key macro-economic projections. Expenditure before annual budget is passed 29. (1) If an annual budget is not passed before the start of the financial year to which it relates, funds may be withdrawn in accordance with this section from the Revenue Fund for the services of the state during that financial year as direct charges 15 against the Fund until the budget is passed. (2) Funds withdrawn from a Revenue Fund in terms of subsection (1 )— (a) may be utilised only for services for which funds were appropriated in the previous annual budget or adjustments budget; and (b) may not— 20 (i) during the first four months of that financial year, exceed 45 per cent of the total amount appropriated in the previous annual budget; (ii) during each of the following months, exceed 10 per cent of the total amount appropriated in the previous annual budget; and (iii) in aggregate, exceed the total amount appropriated in the previous annual 25 budget. (3) The funds provided for in subsection(1) are not additional to funds appropriated for the relevant financial year, and any funds withdrawn in terms of that subsection must be regarded as forming part of the funds appropriated in the annual budget for that financial year. 30 National adjustment budgets 30. (1) The Minister may table an adjustments budget in the National Assembly as and when necessary. (2) A national adjustments budget may only provide for— (a) adjustments required due to significant and unforeseeable economic and 35 financial events affecting the fiscal targets set by the annual budget; (b) unforeseeable and unavoidable expenditure recommended by the national executive or any committee of Cabinet members to whom this task has been assigned ; (c) any expenditure in terms of section 16; (d) money to be appropriated for expenditure already announced by the Minister during the tabling of the annual budget; 40 (e) tie shifting of funds between and within votes or to follow the transfer of functions in terms of section 42; ~) the utilisation of savings under a main division of a vote for the defrayment of 45 excess expenditure under mother main division of the same vote in terms of section 43; and (g) the roll-over of unswnt funds from the preceding financial year. Publishing of reports on state of budget 32. (I) Within 30 days tier the end of each month, tie Nation~ Treasuw must 50 publish in the national Government Gazette a statement of actual revenue and expenditure with regmd to tie National Revenue Fund. 2(> X(1. 19814 GOVERNhlENT CJAZETTE. 2 MARCH IY9Y }ict N{). 1, 199Y PUBLIC FIN.ASCE M.4NAGEhlENT ACT. 199Y (3) The statement must specify the following amounts and compare those amounts in each instance with the corresponding budgeted amounts for the relevant financial year: (a) The actual revenue for the relevant period, and for the financial year up to the end of that period: (b) the actual expenditure per vote (distinguishing between capital and current expenditure) for that period, and for the financial year up to the end of that period; and (c) actual borrowings for that period, and for the financial year up to the end of that period. (4) The National Treasury may deterrnine— (a) the format of the statement of revenue and expenditure; and (b) any other detail the statement must contain. Withholding of appropriated funds

33. The treasury— (a) may withhold from a department any remaining funds appropriated for a specific function if that function is transferred to another department or any other institution; and (b) must allocate those remaining funds to that other department or institution. Unauthorised expenditure 34. (1) Unauthorised expenditure does not become a charge against a Revenue Fund except when— (a) the expenditure is an overspending of a vote and Parliament approves, as a direct charge against the Revenue Fund, an additional amount for that vote which covers the overspending; or (b) the expenditure is unauthorised for another reason and Parliament authorises the expenditure as a direct charge against the Revenue Fund. (2) If Parliament does not approve in terms of subsection ( l)(a) an additional amount for the amount of any overspending, that amount becomes a charge against the funds allocated for the following or future financial years under the relevant vote. 5 10 15 20 25 30 CHAPTER 5 DEPARTMENTS AND CONSTITUTIONAL INSTITUTIONS Part 1: Appointment of accounting oflcers Accounting officers 36. (1) Every department and every constitutional institution must have an 35 accounting officer. (2) Subject to subsection (3)— (a) the head of a department must be the accounting officer for the department; and (b) the chief executive officer of a constitutional institution must be the 40 accounting officer for that institution. (3) The treasury may, in exceptional circumstances, approve or instruct in writing that a person other than the person mentioned in subsection (2) be the accounting officer for— (a) a department or a constitutional institution; or (b) a trading entity within a department. 45 (4) The treasu~ may at any time withdraw in writing an approval or instruction in te~s of subsection (3). (5) The employment contract of an accounting officer for a department, trading entity or constitutional institution must be in writing and, where possible, include 50 Performance standards. The provisions of sections 38 to 42, as may be appropriate, are regarded as forming part of each such contract. /icl N{). 1.1999 PL” BLIC FIS,\SCE N1.4X.AGEMENT ACT. IY99 Acting accounting officers

37. When an accounting officer is absent or otherwise unable to perform the functions of accounting officer, or during a ~acancy. the functions of accounting officer must be performed by the official acting in the place of that accounting officer. Part 2: Respo~tsibilities of accoutlti.Jlg oficers General responsibilities of accounting officers 38. ( 1 ) The accounting officer for a department, trading entity or constitutional institution— (a) must ensure that that department. trading entity or constitutional institution has and maintains- (i) effective, efficient and transparent systems of financial and risk management and internal control; (ii) a system of internal audit under the control and direction of an audit committee complying with and operating in accordance with regulations and instructions prescribed in terms of sections 76 and 77; (iii) an appropriate procurement and provisioning system which is fair, equitable. transparent, competitive and cost-effective; (iv) a system for properly evaluating all major capital projects prior to a final decision on the project; 5 10 15 (b) is responsible for the effective, efficient, economical and transparent use of the resources of the department, trading entity or constitutional institution; 20 (c) must take effective and appropriate steps t~ (i) collect all money due to the department, trading entity or constitutional institution; (ii) prevent unauthorised, irregulas and fruitless and wasteful expenditure 25 (d) (e) (f) (g) (11) (;) (1) and losses resulting from criminal conduct; and (iii) manage available working capital efficiently and economically; is responsible for the management, including the safeguarding and the maintenance of the assets, and for the management of the liabilities, of the department, trading entity or constitutional institution; must comply with any tax, levy, duty, pension and audit commitments as may be required by legislation; must settle all contractual obligations and pay all money owing, including intergovernmental claims, within the prescribed or agreed period; irregulw or fruitless and wasteful on discovery of any unauthorised, expenditure, must immediately report, in writing, particul~s of the expendi- ture to the treasury and in the case of irregular expenditure involving the procurement of goods or services, also to the relevant tender board; must take effective and appropriate disciplinary steps against any official in the service of the department, trading entity or constitutional institution who— (i) contravenes or fails to comply with a provision of this Act; (ii) commits an act which undermines the financial management and internal control system of the department, trading entity or constitutional institution; or (iii) m~es or permits an unauthorised expenditure, irregul~ expenditure or fruitless and wasteful expenditure; when transferring funds in te~s of the annual Division of Revenue Act, must ensure that the provisions of that Act are complied with; before transferring any funds (other than grants in terms of the annual Division of Revenue Act or to a constitutional institution) to an entity within or outside government, must obtain a written assurance from the entity that that entity implements effective, efficient and transparent financial manage- 30 35 40 45 50 Act No. 1.1999 PL”BLIC FIS.\NCE hl.4NAGEMENTACT. i99~) ment and internal control systems, or, if such written assurance is not or cannot be gi~en. render the transfer of the funds subject to conditions and remedial measures requiring the entity to establish and implement effective, efficient and transparent financial management and internal control systems; (k) must enforce compliance with any prescribed conditions if the department, trading entity or constitutional institution gives financial assistance to any entity or person: (/) must take into account all relevant financial considerations, including issues of propriety, regularity and value for money, when policy proposals affecting the accounting officer’s responsibilities are considered, and when necessary, bring those considerations to the attention of the responsible executive authority; (~r~) must promptly consult and seek the prior written consent of the National Treasury on any new entity which the department or constitutional institution intends to establish or in the establishment of which it took the initiative; and (/7) must comply, and ensure compliance by the department, trading entity or constitutional institution, with the provisions of this Act. (2) An accounting officer may not commit a department, trading entity or constitutional institution to any liability for which money has not been appropriated. Accounting officers’ responsibilities relating to budgetiry control 39. (1) The accounting officer for a department is responsible for ensuring that— (u) expenditure of that department is in accordance with the vote of the department and the main divisions within the vote; and (b) effective and appropriate steps are taken to prevent unauthorised expenditure. (2) An accounting officer, for the purposes of subsection (l), must— (a) take effective and appropriate steps to prevent any overspending of the vote of the department or a main division within the vote; (b) report to the executive authority and the treasury any impending (i) under collection of revenue due; (ii) shortfalls in budgeted revenue; and (iii) overspending of the department’s vote or a main division within the vote; and (c) comply with any remedial measures imposed by the treasury in terms of this Act to prevent overspending of the vote or a main division within the vote. Accounting officers’ reporting responsibilities 40. (1) The accounting officer for a department, trading entity or constitutional institution— (a) must keep full and proper records of the financial affairs of the department, trading entity or constitutional institution in accordance with any prescribed norms and standards; (b) must prepare financial statements for each financial year in accordance with generally recognized accounting practice; (c) must submit those financial statements within two months after the end of the financial year tp (i) the Auditor-General for auditing; and (ii) the treasury to enable that treasu~ to prepare consolidated financial statements in terms of section 8; (d) must submit within five months of the end of a financial year to the treasury and, in the case of a dep~ment or trading entity, also to the executive authority responsible for that department or trading entity— (i) an ~nual report on the activities of that department, trading entity or constitutional institution during that financial year; 5 10 15 20 25 30 35 40 45 50 Act N{). 1.1999 PL”BLIC FISANCE hfANAGEMENT ACT. 1999 (ii) the firtancial statements for that financial year after those statements have been audited: and (iii) the Auditor-Generals report on those statements; (e) must, in the case of a constitutional institution, submit to Parliament that institution’s annual report and financial statements referred to in paragraph 5 (d), and the Auditor-General’s report on those statements, within one month after the accounting officer received the Auditor-General’s audit report; and V) is responsible for the submission by the department or constitutional institution of all reports, returns, notices and other information to Parliament, an executive authority, the treasury or the Auditor-General, as may be required 10 by this Act. (2) The Auditor-General must audit the financial statements referred to in subsection (1)(b) and submit an audit report on those statements to the accounting officer within two months of receipt of the statements. (3) The annual report and audited financial statements referred to in subsection (l) 15 (d) must— (a) fairly present the state of affairs of the department, trading entity or constitutional institution, its business, its financial results, its performance against predetermined objectives and its financial position as at the end of the financial year concerned; and 20 (b) include particulars of— (i) any material losses through criminal conduct, and any unauthorised expenditure, irregular expenditure and fruitless and wasteful expendi- ture, that occurred during the financial year; (ii) any criminal or disciplinary steps t~en as a result of such losses, 25 unauthorised expenditure, irregular expenditure and fruitless and waste- ful expenditure; (iii) any material losses recovered or written off and (iv) any other matters that may be prescribed. (4) The accounting officer of a department must— 30 (a) each year before the beginning of a financial year provide the treasury in the prescribed format with a bre&down per month of the anticipated revenue and expenditure of that department for that financial year; (b) each month submit information in the prescribed format on actual revenue and expenditure for the preceding month and the amounts anticipated for that 35 month in terms of paragraph (a); and (c) within 15 days of the end of each month submit to the treasury and the executive authority responsible for that department— (i) the information for that month; (ii) a projection of expected expenditure and revenue collection for the 40 remainder of the current financial year; and (iii) when necessary, an explanation of any material variances and a summary of the steps that are tken to ensure that the projected expenditure and revenue remain within budget. (5) If an accounting officer is unable to comply with any of the responsibilities 45 determined for accounting officers in this Part, the accounting officer must promptly report the inability, together with reasons, to the relevant executive authority and treasury. Information to be submitted by accounting officers 41, An accounting officer for a department, trading entity or constitutional institution 50 must submit to the treasury or the Auditor-General such information, returns, documents, explanations and motivations as maybe prescribed or as the treasury or the Auditor-General may require. Accounting officers’ responsibilities when assets and liabilities are transferred 42. (1) When assets or liabilities of a deptiment are transferred to another department 55 or other institution in terms of legislation or following a reorganisation of functions, the accounting officer for the transferring department must— .; 4 x,) IYS14 Act No. 1.1999 [;()\ ERXNIENT G.AZETTE. 2 M.4KCI{ I<)Y9 PCBLIC RX AXCE MANAGEMENT ACT. 1999 (a) draw up an inventory of such assets and liabilities; and (b) provide the accounting officer for the receiving department or other institution with substantiating records, including personnel records of staff to be transferred. (2) Both the accounting officer for the transferring department and the accounting . 5 officer for the receiving department or other institution must sign the inventory when the transfer takes place. (3) The accounting officer for the transferring department must file a copy of the signed inventory with the treasury and the Auditor-General within 14 days of the transfer. Virement between main divisions within votes 43. (1) An accounting officer for a department may utilise a saving in the a~ount appropriated under a main division within a vote towards the defrayment of excess expenditure under another main division within the same vote, unless the treasury directs otherwise. (2) The amount of a saving under a main division of a vote that may be utilised in terms of subsection (1), may not exceed eight per cent of the amount appropriated under that main division. 10 15 (3) An accounting officer must within seven days submit a report containing the prescribed particulars concerning the utilisation of a saving in terms of subsection (1), 20 to the executive authority responsible for the department and the treasury. (4) This section does not authorise the utilisation of a saving in— (a) an amount specifically and exclusively appropriated for a purpose mentioned under a main division within a vote; (b) an amount appropriated for transfer to another institution; and (c) an amount appropriated for capital expenditure in order to defray current 25 expenditure. (5) A utilisation of a saving in terms of subsection (1) is a direct charge against the Revenue Fund. (6) The National Treasury may by regulation or instruction in terms of section 76 30 regulate the application of this section. Part 3: Other oficials of departments and constitutional institutions Assignment of powers and duties by accounting o~cers 44. (1) The accounting officer for a department, trading entity or constitutional institution may— 35 (a) in writing delegate any of the powers entrusted or delegated to the accounting officer in terms of this Act, to an official in that department, trading entity or constitutional institution; or (b) instruct any oficial in that department, trading entity or constitutional institution to perform any of the duties assigned to the accounting officer in 40 terms of this Act. (2) A delegation or instruction to an official in terms of subsection (l)— (a) is subject to any limitations and conditions prescribed in terms of this Act or as the treasury may impose; (b) is subject to any limitations and conditions the accounting officer may impose; 45 (c) may either be to a specific individual or to the holder of a specific post in the relevant department, trading entity or constitutional institution; and (d) does not divest the accounting officer of the responsibility concerning the exercise of the delegated power or the performance of the assigned duty. (3) The accounting officer may confirm, vary or revoke any decision taken by an 50 - official as a result of a delegation or instruction in terms of subsection (1), subject to any rights that may have become vested as a consequence of the decision. .; () \(l. 19s14 G(>\”ERNhlk:Nl GAZ.EUE. 2 ,M.<RCH 1999 }\ct N(). 1. 1999 P~BLIC FIS.ASCE MAX.AGE}IENT ACT. 199’) Responsibilities of other officials

45. An oticial in a department. trading entity or constitutional institution— (o) must ensure that the system of financial management and internal control established for that department. trading entity or constitutional institution is carried out within the area of responsibility of that official; (b) is responsible for the effective, efficient, economical and transpwent use of financiaI and other resources within that official’s area of responsibility; (c) must take effective and appropriate steps to prevent, within that official’s area of responsibility, any unauthorised expenditure, irregular expenditure and fruitless and wasteful expenditure and any under collection of revenue due; (d) must comply with the provisions of this Act to the extent applicable to that official, including any dele&ations and instructions in terms of section 44; and (e) is responsible for the management, including the safeguarding, of the assets and the management of the liabilities within that official’s area of responsibility. CHAPTER 6 PUBLIC ENTITIES Part Z: Application of this Chapter Applimtion

46. The provisions of this Chapter apply, to the extent indicated, to all public entities listed in Schedule 2 or 3. Unlisted public entities 47. (1) The Minister, by notice in the national Government Gazerte— (a) must amend Schedule 3 to include in the list all pubhc entities that are not listed; and (b) may make technical changes to the list. (2) The accounting authority for a public entity that is not listed in either Schedule 2 or 3 must, without delay, notify the National Treasury, in writing, that the public entity is not listed. (3) Subsection (2) does not apply to an unlisted public entity that is a subsidiary of a public entity, whether the latter entity is listed or not. (4) The Minister may not list the following institutions in Schedule 3: (a) A constitutional institution, the South African Reserve Bank and the Auditor-General; (b) any public institution which functions outside the sphere of national government; and (c) any institution of higher education. Classification of public entities 48. (l) The Minister may by notice in the national Government Gazette classify public entities listed in Schedule 3 in accordance with the relevant definitions set out in section 1, as— (a) national government business enterprises; and (b) national public entities. (2) A public entity is for the purposes of this Act regarded as belonging to the class in which it is classified in terms of subsection (1). 5 10 15 20 25 30 35 40 Part 2: A ccounting authorities for public entities Accounting authorities 49. (1) Every public entity must have an authority which must be accountable for the purposes of this Act. (2) If the public entity— 5 (a) has a board or other controlling body, that board or controlling body is the accounting authority for that entity; or (b) does not have a controlling body, the chief executive officer or the other person in charge of the public entity is the accounting authority for that public entity unless specific legislation applicable to that public entity designates 10 another person as the accounting authority. (3) The treasury, in exceptional circumstances, may approve or instruct that another functionary of a public entity must be the accounting authority for that public entity. (4) The treasury may at any time withdraw an approval or instruction in terms of subsection (3). (5) A public entity must inform the Auditor-General promptly and in writing of any approval or instruction in terms of subsection (3) and any withdrawal of an approval or instruction in terms of subsection (4). Fiduciary duties of accounting authorities 50. (1) The accounting a~thority for a public entity must— 15 QO (u) (b) (c) (d) exercise the dut~ of utmost care ~o ensure reasonable protection of the assets and records of the public entity; act with fidelity, honesty, integrity and in the best interests of the public entity in managing the financial affairs of the public entity; on request, disclose to the executive authority responsible for that public 25 entity or the legislature to which the public entity is accountable, all material facts, including those reasonably discoverable, which in my way may influence the decisions or actions of the executive authority or that legislature; and seek, within the sphere of influence of that accounting authority, to prevent 30 any prejudice to the financial interests of the state. (2) A member of an accounting authority or, if the accounting authority is not a board or other body, the individual who is the accounting authority, may not— (a) act in a way that is inconsistent with the responsibilities assigned to an accounting authority in terms of this Act; or 35 (b) use the position or privileges of, or confidential information obtained as, accounting authority or a member of an accounting authority, for personal gain or to improperly benefit another person. (3) A member of an accounting authority must— (a) disclose to the accounting authority any director indirect personal or private 40 business interest that that member or any spouse, partner or close family member may have in any matter before the accounting authority; and (b) withdraw from the proceedings of the accounting authority when that matter is considered, unless the accounting authority decides that the member’s direct or indirect interest in the matter is trivial or irrelevant. 45 General responsibilities of accounting authorities 51. (1) An accounting authority for a public entity— (a) must ensure that hat public entity has and maintains— (i) effective, efficient and transpwent systems of financial and risk management ~d internal control; (ii) a system of internal audit under the conwo] and direction of an audit committee complying with and operating in accordance with regulations and instructions prescribed in terms of sections 76 and 77; and 50 ‘ }ict No. 1.1999 PL’BI.IC ~N.AXCE hlANAGEhlENT ACT. IY9Y (iii ) an appropriate procurement and provisioning system which is fair, equitable. transparent. competitive and cost-effective; (iv) a system for properly evaluating all major capital projects prior to a final decision on the project; (b) must take effective and appropriate steps to— (i) collect all revenue due to the public entity concerned; and (ii) prevent irregular expenditure, fruitless and wasteful expenditure, losses resulting from criminal conduct, and expenditure not complying with the operational policies of the public entity; and (iii) manage available working capital efficiently and economically; (c) is responsible for the management, including the safeguarding, of the assets and for the management of the revenue, expenditure and liabilities of the public entity; (d) must comply with any tax, levy, duty, pension and audit commitments as required by legislation; (e) must take effective and appropriate disciplinary steps against any employee of the public entity wh~ (i) contravenes or fails to comply with a provision of this Act; (ii) commits an act which undermines the financial management and internal control system of the public entity; or (iii) makes or permits an irregular expenditure or a fruitless and wasteful expenditure; ~) is responsible for the submission by the public entity of all reports, returns, notices and other information to Parliament, and to the relevant executive authority or treasury, as may be required by this Act; (g) must promptly inform the National Treasury on any new entity which that public entity intends to establish or in the establishment of which it takes the initiative, and allow the National Treasury a reasonable time to submit its decision prior to formal establishment; and 5 10 15 20 25 (h) must comply, and ensure compliance by the public entity, with the provisions 30 of this Act and any other legislation applicable to the public entity. (2) If an accounting authority is unable to comply with any of the responsibilities determined for an accounting authority in this Part, the accounting authority must promptly report the inability, together with reasons, to the relevant executive authority and treasury. Annual budget and corporate plan by Schedule 2 public entities and government business enterprises

52. The accounting authority for a public entity listed in Schedule 2 or a government business enterprise listed in Schedule 3 must submit to the accounting officer for a department designated by the executive authority responsible for that public entity or government business enterprise, and to the treasury, at least one month, or another period agreed with the National Treasury, before the start of its financial year— (a) a projection of revenue, expenditure and borrowings for that financial year in the prescribed format; and (b) a corporate plan in the prescribed format covering the affairs of that public entity or business enterprise for the following three financial years, and, if it has subsidiaries, also the affairs of the subsidiaries. Annual budgets by non-business Schedule 3 public entities 53. (l) The accounting authority for a public entity listed in Schedule 3 which is not a government business enterprise must submit to the executive authority responsible for that public entity, at least six months before the start of the financial year of the department designated in terms of subsection (2) or another period agreed to between the executive authority and tie public entity, a budget of estimated revenue and expenditure for that financial yem, for approval by the executive authority. 35 40 45 50 (2) The budget must be submitted to the executive authority through the accounting 55 42 x,). 19s14 Act No. 1, 199Y GOVERNMENT GAZEnE. 2 hlARCH 1999 PUBLIC ~NANCE MANAGEMENT ACT. 1999 officer for a department designated by the executive authority, who may make recommendations to the executive authority with regard to the approval or amendment of the budget. (3) A public entity which must submit a budget in terms of subsection (1), may not budget for a deficit and may not accumulate surpluses unless the prior written approval of the National Treasury has been obtained. (4) The accounting authority for such a public entity is responsible for ensuring that expenditure of that public entity is in accordance with the approved budget. (5) The National Treasury may regulate the application of this section by regulation or instruction in terms of section 76. Information to be submitted by accounting authorities 54. (1) The accounting authority for a public entity must submit to the treasury or the Auditor-General such information, returns, documents, explanations and motiva- tions as may be prescribed or as the treasury or the Auditor-General may require. (2) Before a public entity concludes any of the following transactions, the accounting authority for the public entity must promptly and in writing inform the treasury of the transaction and submit relevant particulars of the transaction to its executive authority for approval of the transaction: 5 10 15 (a) establishment or participation in the establishment of a company; (b) participation in a significant partnership, trust, unincorporated joint venture or 20 similar arrangement; (c) acquisition or disposal of a significant shareholding in a company; (d) acquisition or disposal of a significant asset; (e) commencement or cessation of a significant business activity; and (V a significmt change in the nature or extent of its interest in a significant partnership, trust, unincorporated joint venture or similar arrangement. (3) A public entity may assme that approval has been given if it receives no response from the executive authority on a submission in terms of subsection (2) within 30 days or within a longer period as maybe agreed to between itself and the executive authority. (4) The executive authority may exempt a public entity listed in Schedule 2 or 3 from subsection (2). Annual report and financial statements 55. (1) The accounting authority for a public entitY— (aj (b) (c) (d) must keep full and proper records of the financial affairs of the public entity; prepare financial statements for each financial year in accordance with generally accepted accounting practice, unless the Accounting Standards Board approves the application of generally recognised accounting practice for that public entity; must submit those financial statements within two months after the end of the financial year— (i) to the auditors of the public entity for auditing; and (ii) if it is a business enterprise or other public entity under the ownership control of the national government, to the treasury; and must submit within five months of the end of a financial year to the treasury, to the executive authority responsible for that public “entity and , if the Auditor-General did not perform the audit of the financial statements, to the Auditor-General— (i) an annual report on the activities of that public entity during that financial year; (ii) the financial statements for that financial year after the statements have been audited; and (iii) the report of the auditors on those statements. (2) The annual report and financial statements referred to in subsection (1) (d) must— (a) fairly present the state of affairs of the public entity, its business, its financial 25 30 35 40 45 50 55 4J so, 198!4 GO\ ’E RNhl ENT GAZEmE. 2 NIARCH 1999 ..\ct N{). 1. IY99 PUBLIC ~NAXCE \fANAGE,MENT ACT. 1999 results. its performance against predetermined objectives and its financial position as at the end of the financial year concerned; (b) include particulars of— (i) any material losses through criminal conduct and any irregulm expendi- ture and fruitless and wasteful expenditure that occurred during the 5 financial year; (ii) any criminal or disciplinary steps taken as a consequence of such losses or irregular expenditure or fruitless and wasteful expenditure; (iii) any losses recovered or written off, (iv) any financial assistance received from the state and commitments made 10 by the state on its behalfi and (v) any other matters that may be prescribed; and (c) include the financial statements of any subsidiaries. (3) An accounting authority must submit the report and statements referred to in subsection (1) (d), for tabling in Parliament, to the relevant executive authority through 15 the accounting officer of a department designated by the executive authority. (4) The treasury may direct that, instead of a separate report, the audited financial statements of a Schedule 3 public entity which is not a government business enterprise must be incorporated in those of a department designated by the treasury. Part 3: Other oficials ofpublic entities 20 Assignment of powers and duties by accounting authorities 56. (1) The accounting authority for a public entity may— (a) in writing delegate any of the powers entrusted or delegated to the accounting authority in terms of this Act, to an official in that public entity; or (b) instruct an official in that public entity to perform any of the duties assigned to 25 the accounting authority in terms of this Act. (2) A delegation or instruction to an official in terms of subsection (l)— (a) is subject to arty limitations and conditions the accounting authority may impose; (b) may either be to a specific individual or to the holder of a specific post in the 30 relevant public entity; and (c) does not divest the accounting authority of the responsibility concerning the exercise of the delegated power or the performance of the assigned duty. (3) The accounting authority may confirm, vary or revoke any decision taken by an official as a result of a delegation or instruction in terms of subsection (1), subject to any 35 rights that may have become vested as a consequence of the decision. Responsibilities of other o~cials

57. An official in a public entity— (a) (b) (c) (d) (e) must ensure that the system of financial management and internal control established for that public entity is carried out within the area of responsibility 40 of that official; is responsible for the effective, efficient, economical and transparent use of financial and other resources within that official’s area of responsibility; must take effective and appropriate steps to prevent, within that official’s area of responsibility, any irregular expenditure and fruitless and wasteful 45 expenditure and any under collection of revenue due; must comply with the provisions of this Act to the extent applicable to that official, including any delegations and instructions in terms of section 56; and is responsible for the management, including the safegumding, of the assets and the management of the liabilities within that official’s area of responsi- 50 bility. ,ict N(). 1, 1Y99 PLIBLIC ~NANCE ~A~AGEMENT ACT. 1999 Part 4: External auditors Appointment of auditors 58. (l) The annual financial statements of a public entity must be audited annually by— (a) the Auditor-General; or (b) a person registered in terms of section 15 of the Public Accountants’ and Auditors’ Act, 1991 (Act No. 80 of 1991), as an accountant and auditor, and engaged in public practice as such. (2) A public entity may appoint, as its auditor, a person referred to in subsection ( l)(b) only if the audit is not performed by the Auditor-General. (3) A public entity must consult the Auditor-General on the appointment of an 5 10 auditor in terms of subsection (2). Discharge of auditors 59. (1) An auditor appointed by a public entity in terms of section 58 (1 ) (b) may not be discharged before tie expiry of that auditor’s term of appointment except by the 15 executive authority responsible for that public entity acting— (a) after consultation with the accounting authority for that public entity; and (b) with the concurrence of the Auditor-General. (2) If an executive authority intends discharging an auditor in terms of subsection (l), the executive authority must— (a) in writing give notice of the proposed discharge to the auditor, with reasons; and (b) give the auditor an opportunity to make written representations to the executive authority and the Auditor-General within 20 days of receipt of the notice. (3) The Auditor-General must report any discharge of an auditor in terms of this 20 25 section to Parliament. Duties and powers of auditors 60. (1) An auditor appointed in terms of section 58(l)(b) must perform the functions of office as auditor in terms of section 20 of the Public Accountants’ and Auditors’ Act, 30 1991 (Act No. 80 of 1991). (2) In exercising the powers and performing the duties as auditor of a public entity the auditor— (a) has access at all reasonable times to the accounting records, including all books, vouchers, documents and other propeny of the public entity; 35 (b) may require from the accounting authority for that public entity such information and explanations as are necess~ for the purpose of the audit; and (c) may investigate whether there are adequate measures and procedures for the proper application of sound economic, efficient and effective management. (3) An auditor appointed in terms of section 58(1)(b) may consult the Auditor- 40 General or any person in the Office of the Auditor-General concerning any matter relating to the auditing of the public entity concerned. (4) An auditor appointed in terms of section 58(1 )(b)— (a) must receive notice of every meeting of the public entity’s audit committee; and 45 (b) may attend, and participate in, any meeting of the audit committee at the expense of the public entity. Reporti of auditor 61. (1) The repofl of an auditor appointed in te~s of section 58(1 )(b) must be addressed to the executive authority responsible for the public entity concerned and 50 4s No. 19814 G(l\/ERNMENT GAZETTE. 2 31.ARCH 1999 Act N(). 1.1999 PUBLIC FIN.AXCE MANAGEMENT ACT. 1999 must state separately in respect of each of the following matters whether in the auditors opinion— (n) the annual financial statements of the public entity fairly present the financial position and the results obtained by the entity in accordance with subsection 55( 1)(b) applied on a basis consistent with that of the preceding year; (b) if required by the Auditor-General, the performance information furnished in terms of subsection 55(2)(a) is fair in all material respects and, if applicable, on a basis consistent with that of the preceding year; and (c) the transactions that had come to the auditor’s attention during auditing were in all material respects in accordance with the mandatory functions of the public entity determined by law or otherwise. (2) The auditor— (a) must report to the executive authority responsible for the public entity the results of any investigation carried out under subsection 60(2)(c); and (b) when reporting in terms of paragraph (a), must draw attention to any other matters within the auditor’s investigation which, in the auditor’s opinion, should in the public interest be brought to the notice of Parliament. Duties and powers of Auditor-General 62. (1) The Auditor-General may— (a) investigate any public entity or audit the financial statements of any public entity if the Auditor-General is not appointed. as auditor and the Auditor- General considers it to be in the public interest’ or upon the receipt of a complain~ and (b) recover the cost of the investigation or audit from the public entity. 5 10 15 20 (2) An investigation or audit in terms of section (1) maybe carried out either by the 25 Auditor-General or a person appointed by the Auditor-General. (3) The executive authority responsible for a public entity in respect of which the Auditor-General has issued a special report in terms of subsection (1) or (2), must promptly table the report in the National Assembly. (4) The Auditor-General may— (a) claim the reasonable cost of performing the duties and exercising the powers in terms of this section from the public entity concerned; and (b) annually report to Parliament on specific and general findings regarding the accountability of public entities. CHAPTER 7 EXECU~VE AUTHORITIES 30 35 Financial responsibilities of executive authorities 63. (1)(a) Executive authorities of departments must perform their statutory functions within the limits of the funds autiorised for the relevant vote. (b) In performing their statutory functions executive authorities must consider the monthly reports submitted to them in terms of section 39(2)(b) and 40(4)(c). (~) The executive authority responsible for a public entity under the o w n e r s h ip control of the national executive must exercise that executive’s ownership control powers to ensure that that public entity complies with this Act and the financial policies of that executive. 40 45 Executive directives having financial implications 64. (1) Any directive by an executive authority of a department to the accounting officer of the department having financial implications for the department must be in Writing. (2) If implementation of the directive is likely to result in unauthorised expenditure, the accounting officer will be responsible for any resulting unauthorised expenditure 50 50 N(1 19814 Act No. 1, IY99 GO\ ’ERNhl E\’T GAZETTE. 2 hl,ARCH I ~)~)() PL’BLIC FINANCE MANAGEMENT ACT. 1999 unless the accountin& officer has informed the executive authority in writing of the likelihood of that unauthorised expenditure. (3) Any decision of the executive authority to proceed with the implementation of the directive, and the reasons for the decision, must be in writing, and the accounting oficer must promptly file a copy of this document with the National Treasury and the Auditor-General. Tabling in legislatures 65. (1) The executive authority responsible for a department or public entity must table in the National Assembly.— (a) the annual report and financial statements referred to in section 40(1)(d) or 55( 1)(d) and the audit report on those statements, within one month after the accounting officer for the department or the accounting authority for the public entity received the audit report; and (b) the findings of a disciplinary board, and any sanctions imposed by such a board, which heard a case of financial misconduct against an accounting officer or accounting authority in terms of section 81 or 83. (2) If an executive authority fails to table, in accordance with subsection(1) (a), the annual report and financial statements of the department or the public entity, and the audit report on those statements, in the relevant legislature within six months after the end of the financial year to which those statements relate— (a) the executive authority must table a written explanation in the legislature setting out the reasons why they were not tabled; and (b) the Auditor-General may issue a special report on the delay. 5 10 15 20 CHAPTER 8 LOANS, GUARANTEES AND OTHER COMMITMENTS 25 Pati 1: General principles Restrictions on borrowing, guarantees and other commitments 66. (1) An institution to which this Act applies may not borrow money or issue a guarantee, indemnity or security, or enter into any other transaction that binds or may bind that institution or the Revenue Fund to any future financial commitment, unless such borrowing, guarantee, indemnity, security or other transaction— (a) is authorised by this Act; and (b) in the case of public entities, is also authorised by other legislation not in conflict with this Act. (2) Only the following persons may borrow money, or issue a guarantee, indemnity or security, or enter into any other transaction that binds or may bind the Revenue Fund to any future financial commitment: (a) Transactions that bind or may bind the National Revenue Fund: the Minister or, in the case of the issue of a guarantee, indemnity or security, the responsible Cabinet member acting with the concurrence of the Minister in terms of section 70. 30 35 40 (3) Public entities may only through the following persons borrow money, or issue a guarantee, indemnity or security, or enter into any other transaction that binds or may bind that public entity to any future financial commitment: (a) A public entity listed in Schedule 2: The accounting authority for that 45 Schedule 2 public entity. (b) A national government business enterprise listed in Schedule 3 and authorised by notice in the national Govenlment Gazette by the Minister: The accounting authority for that government business enterprise, subject to any conditions the Minister may impose. (c) Any other national public entity: The Minister or, in the case of the issue of a guarantee, indemnity or security, the Cabinet member who is the executive authority responsible for that public entity, acting with the concurrence of the Minister in terms of section 70. 50 52 X(). 19s14 Act N(). 1, 1999 G()\’I;RNh!EXT GAZI<TTE. 2 A1,ARCH 19YY PL”BLIC FINANCE hlANAGEMENT ACT. 1999 (4) Constitutional institutions may not borrow money. nor issue a guarantee. indemnity or security, nor enter into any other transaction that binds or may bind the entity to any future financial commitment. (5) Despite subsection (4), the Minister may in writing permit a public entity mentioned in subsection (3)(c) or a constitutional institution to borrow money for bridging purposes up to a prescribed limit, including a temporaw bank overdraft> subject to such conditions as the Minister may impose. (6) A person mentioned in subsection (2) or (3) may not delegate a power conferred in terms of that subsection. except v’ith the prior written approval of the Minister. (7) A public entity authorised to borrow money— (a) must annually submit to the Minister a borrowing programme for the year; and (b) may not borrow money in a foreign currency above a prescribed limit, except when that public entity is a company in which the state is not the only shareholder. . Consequences of unauthorised transactions

68. If a person, otherwise than in accordance with section 66, lends money to an institution to which this Act applies or purports to issue on behalf of such an institution a guarantee, indemnity or security, or enters into any other transaction which purports to bind such an institution to any future financial commitment, the state and that institution is not bound by the lending contract or the guarantee, indemnity, security or other transaction. Regulations on borrowing by public entities 5 10 15 20

69. The Minister may by regulation in terms of section 76 regulate the borrowing of money by or for or on behalf of public entities referred to in section 66 (3) (b) and (c), 25 Guarantees, indemnities and securities by Cabinet members 70. (1) A Cabinet member, with the written concurrence of the Minister (given either specifically in each case or generally with regard to a category of cases and subject to any conditions approved by the Minister), may issue a guarantee, indemnity or security which binds— 30 (a) the National Revenue Fund in respect of a financial commitment incurred or to be incurred by the national executive; or (b) a national public entity referred to in section 66(3)(c) in respect of a financial commitment incurred or to be incurred by that public entity. (2) Any payment under a guarantee, indemnity or security issued in terms of— 35 (a) subsection (1)(a), is a direct charge against the National Revenue Fund, and any such payment must in the first instance be defrayed from the funds budgeted for the department that is concerned with the issue of the guarantee, indemnity or security in question; and (b) subsection (1)(b), is a charge against the national public entity concerned. (3) A Cabinet member who seeks the Minister’s concurrence for the issue of a guarantee, indemnity or security in terms of subsection (1)(a) or (b), must provide the Minister with all relevant information as the Minister may require regarding the issue of such guarantee, indemnity or security and the relevant financial commitment. (4) The responsible Cabinet member must at least annually report the circumstances relating to any payments under a guarantee, indemnity or security issued in terms of subsection (1)(a) or (b), to the National Assembly for tabling in the National Assembly. 40 45 i4 N(}. 19814 GC)\:ERXhlENT GAZETTE.. 2 hf.4RCH 199Y !\ct No. 1.1999 PUBLIC RN.ANCE MANAGEMENT ACT. ! 999 Part 2: bans by national govern)nent Purposes for which Minister may borrow money

71. The Minister may borrow money in terms of section 66(2)(a) for the following purposes only: (a) To finance national budget deficits; (b) to refinance maturing debt or a loan paid before the redemption date; (c) to obtain foreign currency; (d) to maintain credit balances on a bank account of the National Revenue Fund; (e) to regulate internal monetary conditions should the necessity arise; or (f) any other purpose approved by the National Assembly by special resolution. Signing of loan agreements

72. The Minister, on conditions determined by the Minister, may authorise another person to sign a loan agreement when the Minister borrows money in terms of section 66(2)(a). Interest and repayments of loans to be direct charges

73. The following payments in connection with loans are direct charges against the National Revenue Fund: (a) the repayment of money borrowed by the Minister in terms of section 66(2)(a) or repaid in terms of section 74; (b) the interest payable on money borrowed; and (c) any costs associated with such borrowing and approved by the National Treasury. Repayment, conversion and consolidation of loans

74. The Minister may, on such terms and conditions as the Minister may determine, and, when necess~, with the concurrence of the lender— (a) repay any loan prior to the redemption date of that loan; (b) convert the loan into any other loan; or (c) consolidate two or more loans into an existing or new loan. Obligations from lien over securities

75. Neither the Minister, nor the National Treasury is responsible for the fulfillment of any obligation resulting from any lien, whether expressed, implied or construed, held over any security issued in terms of this Act, despite the fact that the Minister or the National Treasury was notified of the lien. CHAPTER 9 GENERAL TREASURY MATTERS Treasury regulations and instructions 76. (1) The National Treasury must make regulations or issue instructions applicable to departments, conceming— (a) any matter that must be prescribed for departments in terms of this Act; (b) the recovery of losses and damages; (c) the handling of, and control over, trust money and property; (d) the rendering of free services; (e) the writing off of losses of state money or other state assets or amounts owed to the state: 5 10 15 20 25 30 35 40 ? (? X(). 19s14 GO\’ERNMENT GAZETTE. 2 MARCH 1999 Act N(). 1.1999 PUBLIC ~N.AXCE MANAGEMENT ACT. 1999 (f) liability for losses and dama&es and procedures for recovery; (g) the cancellation or variation of contracts to the detriment of the state; (h) the settlement of claims by or against the state; (;) the waiver of claims by the state; (~) the remission of money due to the Revenue Fund, refunds of revenue and 5 payments from the Revenue Fund, as an act of grace; (k) the alienation, letting or other disposal of state assets; and (1) gifts or donations by or to the state. (2) The National Treasury may make regulations or issue instructions applicable to , departments. conceminr— (a) (b) (c) (d) (e) V) (g) (h) (i) (j) any matter th~t may be prescribed for departments in terms of this Act; the charging of expenditure against particular votes; the establishment of and control over trading entities; the improvement and maintenance of immovable state assets; fruitless and wasteful, unauthorised and irregular expenditure; the determination of any scales of fees, other charges or rates relating to revenue accruing to, or expenditure from, a Revenue Fund; the treatment of any specific expenditure; vouchers or other proofs of receipts or payments, which are defective or have been lost or damaged; assets which accrue to the state by operation of any law; or any other matter that may facilitate the application of this Act. 10 15 20 (3) Regulations in terms of sub~ection ( 1) or (2)-may prescribe matters for which the prior approval of a treasury must be obtained. (4)The National Treasury may make regulations or issue instructions applicable to d] 25 institutions to which this Act applies conceming— (a) any matter that may be prescribed for all institutions in terms of this Act; (b) financial management and internal control; (c) the determination of a framework for an appropriate procurement and provisioning system which is fair, equitable, transparent, competitive and 30 cost-effective; (d) audit committees, their appointment and their functioning; (e) internal audit components and their functioning; W) the administration of this Act; and (g) any other matter that may facilitate the application of this Act. (5) A treasury regulation or instruction in terms of this section may— (a) differentiate between different categories of— (i) institutions to which this Act applies; (ii) accounting officers; or (iii) accounting authorities; or (b) be limited in its apphcation to a specific category of— (i) institutions to which this Act applies; (ii) accounting officers; or (iii) accounting authorities. Audit committees

77. An audit committee— must consist of at least three persons of whom, in the case of a department— (i) one must be from outside the public service; (ii) the majority may not be persons in the employ of the department, except with the approvrd of the treasury; and (iii) the chairperson may not be in the employ of the department; must meet at least twice a year; and may be established for two or more departments or institutions if the treasury consider it to be more economical. 35 40 45 50 Act No. 1, 1999 PL’BLIC FIS.4XCE hl.4NAGEMENT ACT. 1999 .. Publishing OF draft treasury regulations for public comment

78. Draft regulations in terms of section 76 must be published for public comment in the national Government Ga:ette before their enactment. Departures from treasury regulations, instructions or conditions

79. The National Treasun may on good grounds approve a departure from a treasury regulation or instruction or any condition imposed in terms of this Act and must promptly inform the Auditor-General in writing when it does so. Determination of interest rates for debt owing to state 80. (1) The Minister, by notice in the national Government Gazette, must deter- mine— 5 10 (a) a uniform interest rate applicable to loans granted out of the Revenue Fund; and (b) a uniform interest rate applicable to dl other debts which must be paid into the Revenue Fund . (2) An interest rate determined in terms of subsection (1)(b) may differentiate 15 between different categories of debt. CHAPTER 10 F~ANCUL MISCONDUCT Part 1: Dkciplinaq proceedings Financial misconduct by ofici~ in departments and constitutional institutions 20 81. (1) An accounting 05cer for a department or a constitutional institution commits an act of financial misconduct if that accounting officer willfully or negligently— (a) fails to comply with a requirement of section 38,39,40,41 or 42; or (b) makes or permits an unauthorised expenditure, an irregular expenditure or a 25 fruitless and wasteful expenditure. (2) An official of a department, a trading entity or a constitutional institution to whom a power or duty is assigned in terms of section 44 commits an act of financial misconduct if that 05cial willfully or negligently fails to exercise that power or perform that duty. 30 Financial misconduct by trasury officials

82. An official of the treasury to whom a power or duty is assigned in terms of section 10 commits an act of financial misconduct if that official willfully or negligently fails to exercise that power or perform that duty. Financial misconduct by accounting authorities and o5cials of public entities 35 83. (1) The accounting authority for a public entity commits an act of financial misconduct if that accounting authority willfully or negligently— (a) fails to comply with a requirement of section 50,51, 52,53, 54 or 55; or (b) makes or permits m irregul= expenditure or a fruitless and wasteful expenditure. (2) If the accounting authority is a board or other body consisting of members, every member is individually and severally liable for any financial misconduct of the accounting authority. (3) An official of a public entity to whom a power or duty is assigned in terms of section 56 commits an act of financial misconduct if that o5cial willfully or negligently fails to exercise that power or perform that duty. (4) Financial misconduct is a ~ound for dismissal or suspension of, or other sanction against, a member or person referred to in subsection (2) or (3) despite any otier legislation. 40 45 6(J N() 19814 Act No. 1.1999 G()\’ERN-MENT GAZE”l-I”L. 2 MAKLH I YYY PUBLIC mNANCE MANAGEMENT ACT. 1999 Applicable legal regime for disciplinary proceedings

84. A charge of financial misconduct against an accounting officer or official referred to in section 81 or 83, or an accounting authority or a member of an accounting authority or an official referred to in section 82, must be investigated, heard and disposed of in terms of the statutory or other conditions of appointment or employment applicable to 5 that accounting officer or authority, or member or official, and any regulations prescribed by the Minister in terms of section 85. Regulations on financial misconduct procedures 85. (1) The Minister must m*e regulations prescribing— (a) the manner, form and circumstances in which allegations and disciplinary and 10 criminal charges of financial misconduct must be reported to the National Treasury and the Auditor-General, including— (i) particulars of the alleged financial misconduc~ and (ii) the steps t&en in connection with such financial misconduct; (b) matters relating to the investigation of allegations of financial misconduct; 15 (c) the circumstances in which the National Treasury may direct that disciplin~ steps be t~en or criminal charges be laid against a person for financial misconduct; (d) the circumstances in which a disciplin~ board which hears a charge of financial misconduct must include a person whose name appears on a list of 20 persons with expertise in state finances or public accounting compiled by the National Treasury; (e) the circumstmces in which the findings of a disciplinary board and any sanctions imposed by the board must be reported to the National Treasury, and the Auditor-General; and ~) any other matters to the extent necessary to facilitate the object of this Chapter. (2) A regulation in terms of subsection(1) may— (a) differentiate between different categories of— (i) accounting officers; (ii) accounting authorities; (iii) officials; and (iv) institutions to which this Act applies; and (b) be limited in its application to a particular category of accounting officers, accounting authorities, 05cials or institutions only. Part 2: Criminal proceedings Offences and penalties 25 30 35 86. (1) An accounting officer is guilty of an offence and liable on conviction to a fine, or to imprisonment for a period not exceeding five years, if that accounting officer willfully or in a grossly negligent way fails to comply with a provision of section 38, 39 40 or 40. (2) An accounting authority is guilty of an offence and liable on conviction to a fine, or to imprisonment for a period not exceeding five years, if that accounting authority wilfully or in a grossly negligent way fails to comply with a provision of section 50, 51 or 55. 45 (3) Any person, other than a person mentioned in section 66(2) or (3), who purports to borrow money or to issue a guarantee, indemnity or security for or on behalf of a department, public entity or constitutional institution, or who enters into any other contract which purports to bind a department, public entity or constitutional institution to any future financial commitment, is guilty of an offence and liable on conviction to a 50 fine or to imprisonment for a period not exceeding five years. Act No. 1. 1999 PC’B1.lC FIS.-$XCE MA NAGELfEST ACT. 1999 CHAPTER 11 ACCOUNTING STANDARDS BOARD Establishment 87. ( 1 ) The Minister by regulation in terms of section 91 must establish a board to be known as the Accounting Standards Board. (2) The Accounting Standards Board is a juristic person. Composition 88. (l) The Accounting Standards Board consists of no more than 10 members as the Minister may determine. (2) The Minister, after consulting the Auditor-General, appoints the members of the 10 Board. (3) The Board may establish its own operating procedures. Functions of Board 89. (1) The Accounting Standards Board must— (a) set standards of generally recognised accounting practice as required by 15 section 216( l)(a) of the Constitution, for the annual financial statements of— (i) departments; (ii) public entities; (iii) constitutional institutions; (iv) municipalities and boards, commissions, companies, corporations, funds 20 or other entities under the ownership control of a municipality; and (b) (c) (d) (v) Parliament; prepare and publish directives and guidelines concerning the standards set in terms of paragraph (a); recommend to the Minister effective dates of implementation of these 25 standards for the different categories of institutions to which these standards apply; and perform any other function incidental to advancing financial reporting in the public sector. setting standards the Board must take into account all relevant factors, 30 (2) In including— (a) best accounting practices, both locally and internationally; and (b) the capacity of the relevant institutions to comply with the standards. (3) The Board may set different standards for different categories of institutions to which these standards apply. (4) The standards set by the Board must promote transparency in and effective management of revenue, expenditure, assets and liabilities of the institutions to which these standards apply. 35 Powers of Board

6. Iniala Farms (Pty) Ltd -. \,, 19>14 ,\~t so. 1.1999 PL”BLIC FISANCE 3!.ANAGEF4ENT ACT. 1999 (;()\ERNMF,NT GAZETTF;. ~ NfAR~H I ~~’) Kal;~hari-Oos \Fatemaad Kalahari-Wes \Fatemaad Karos-Geelkoppen Watemaad 7. 8. 9.

10. Khula Enterprises Lanok (ptY) ‘td Il.

13. Mhlathuze W a t er

14. Mjindi Farming (Pty) Ltd

15. Mpendle-Ntambanana Agricultural Company (Pty) Ltd

17. Ncera F a r m s (Pty) Ltd

18. Noord Transvaal Water / Meetse 19. 20. 21. 22. 23. 24. 25. 26. Ntsika Ente~rises Overberg Walter pelladrift Water Phalaborwa Water Rand Water Board SA Rail Commuter Corporation Limited Umgeni Water Bowd Any subsidiary or entity under the ownership control of the above public entitieS Act No. 1, 1999 PIBLIC FI\.ANCE h14NAGEMENT ACT. 19QC) SCHEDULE 4 EXCLUSIONS FROM REVENUE FUNDS (In terms of section 13(l)(g)) 1. SA Schools Act (covering school fees) SCHEDULE 5 DIRECT CHARGES AGAINST NATIONAL REVENUE FUND Payments in terms of the following Acts: 1. Remuneration of Public Office Bearers Act, 1998 (Act No. 20 of 1998) (Covering the President’s salary and the salaries of members of Parliament sections 2(7) and 3(7)); Remuneration and Allowances of Deputy Presidents, Ministers and Deputy Ministers Act, 1994 (Act 53 of 1994) (Covering the salary of the Deputy President section 4(a)); 2.

3. Judges’ Remuneration and Conditions of Employment Act, 1989 (Act 88 of 1989) (Covering salaries and allowances of Judges and Judges seconded to governments of other countries in terms of section 2). ,ict No. 1.1999 PVBLIC FfNANCE NIANAGEMENT .ACT. 1999 SCHEDULE 6 REPEAL OF LEGISLATION (Section 87) No. and year of act (a) Act No. 66 of 1975 Short title Exchequer Act. 1975 Act No. 106 of 1976 Act No. 93 of 1977 Act No. 105 of 1979 Proclamation No. R.85 of 1968 Act No. 67 of 1980 Act No. 29 of 1981 Act No. l180f 1981 Act No. 100 of 1984 Act No. 9 of 1989 Act No. 120 of 1991 Act No. 96 of 1992 Act No. 69 of 1993 Act No. t 23 of 1993 Act No. 142 of 1993 Act No. 182 of 1993 Act No. 41 of 1994 (b) Act No. 93 of 1992 (C) Act No. 66 of 1975 Financial Arrangements with the Transkei Act, 1976 Financial Arrangements with Boputhtastwana Act. 1977 Flrrancial Arrangements with Vends Act. 1979 South West Africa Constitution Act, 1968 (Act No. 39 of 1968) Railways and Harbours Acts Amendment Act, 1980 Railways and Harbours Acts Amendment Act, 1981 Financial Arrangements with Clskei Act, 1981 Exchequer and Audit Amendment Act. 1984 Legal Succession of the South Afri- can Transpon Services Act, 1989 Finance Act, 1991 Parr Appropriation Acts Abolition Act, 1992 Exchequre Amendment Act, 1993 Finance Act. 1993 Exchequer Second Amendment Act, 1993 Exchequer Third Amendment Act, 1993 Finance Act, 1994 Reporting by Public Entities Act, 1992 Exchequer and Audit Act, 1975 Act No. 102 of 1976 Finance Act. 1976 (d) Act No. 29 oi 1992 (Bophuthatswana) Act No. 16 of 1993 (Bophuthatswana) (e) Act No, 66 Oi 1975 Exchequer ACI, 1992 Exchequer Amendment Act, 1993 The whole Exchequer and Audit Act, 1975 Act No. I I 1 of 1977 Finance Act, 1977 Acl No, 94 of 1978 Finance Act, 1978 Extent of repeal The whole. except sections 28, 29. 30 The whole The whole The whole Part 3 Section 19 Section 21 The Whole The whole Schedule 2 Part 6 of the act insofar as it relates to the Exchequer Act, 1975 Sections 14, 15 and 16 The whole The whole The whole The whole The whole Sec~ions 17 and 18 The whole The whole insofar as it is in force in the area of the former Republic of Transkei Sections 23, 24 and 25 insofar as it is in force in the area of the former Republic of Transkei The whole The whole insofar as it is in force in the mea of the former Republic oi Vends Sections 9, 10 and } 1 insofar as it is in force in the area of the former Republic oi Vends Sections 12, 13 and 14 insofar as it is in force in the area of the former Republic of Vends .,, l.)>,- tiOVk KNMLN 1 LT.ALLI lb. J MAKLH IYVY ,\cf No. 1, 1999 PLBLIC ~NANCE MANAGEMENT ACT, 1999 No. and year of act Proclamation No. R.85 of Short title Exchequer and Audit Proclamation I ACI No. 21 of 1983 (Vends) Act No. 18 of 1987 (Vends) Act No. 28 of 1989 (Vends) Exchequer and Audit Amendment \ Act, 1983 Exchequer and Audit Amendment \ Act, 1987 Exchequer and Audit Amendment Act, 1989 Proclamation No. 25 of 1993 Exchequer and Audit Amendment (Vends) Act, 1993 Exchequer and Audit Act, 1985 (f) Act No. 28 of 1985 (Ciskei) L Extent of repeal SectIons 16 and 17 insofar as it is I in force in the area of the former I I Republic of Vends The whole I I The whole I The whole The whole The whole