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Committees should employ innovative methods of consulting public

Opinion & Analysis
The Portfolio Committee on Budget, Finance and Economic Development has this week been conducting public hearings on the Public Debt Management Bill, which is currently before the National Assembly.

The Portfolio Committee on Budget, Finance and Economic Development has this week been conducting public hearings on the Public Debt Management Bill, which is currently before the National Assembly.

The committee has been to places such as Kariba, Victoria Falls, Bindura, Masvingo, Marondera, Mutare, Gwanda and Beitbridge soliciting civil society and public input on the draft legislation in line with Section 141 of the Constitution. This provision compels Parliament to ensure that interested parties are consulted about bills being considered by the legislative branch before they are passed into law.

The Public Debt Management Bill seeks to provide for the management of public debt in Zimbabwe. It also seeks to provide for the functions and administration of the Public Debt Management Office which is a department that currently exists within the Ministry of Finance and Economic Development.

Some of the hearings have been well-attended, with informed submissions being made. Others have been poorly attended. Stakeholders have complained about poor publicity about the hearings and inadequate information on the Bill to allow them to sufficiently prepare to make submissions.

It is very expensive for committees to travel to all provinces to solicit public input on draft legislation.

Parliament should therefore employ other cost-effective mechanisms to seek public input. They include use of social media such as WhatsApp and Facebook, live radio and television submissions to the committee and sending written submissions to Parliament.

Section 141 does not say Parliament must conduct public hearings. It says Parliament must consult the public. Other mechanisms can therefore be used apart from public hearings.

I would like to turn to the content of the Public Debt Management Bill itself. While the Bill is generally progressive in trying to put in place mechanisms for public debt management, some of its provisions are not far-reaching enough.

Among its other functions, the Public Debt Management Office will prepare and publish an annual borrowing plan which includes a borrowing limit and participate in the preparation of an issuance calendar of government securities in line with the annual borrowing plan.

This provision is line with Section 300 of the Constitution which calls for an Act of Parliament to set limits on State borrowings, public debt and debts and obligations whose payment or repayment is guaranteed by the State. The Bill, however, does not go far enough to explicitly prescribe terms and conditions under which the government may guarantee loans as required under Section 300 (2) of the Constitution.

While it empowers Parliament to approve the limits on borrowings and public debt set by the Public Debt Management Office, there are other provisions that give the Minister of Finance too much power in the issuance of guarantees.

members of parliament

For example, the Minister may, “in such manner and upon such conditions as he or she thinks fit with the consent of the President, guarantee the repayment of the capital of, and the payment of expenses or charges incurred on or in connection with any indebtedness or other financial obligation raised, incurred or established, as the case may be, inside or outside Zimbabwe by a person approved by the Minister for purposes which will, in the opinion of the Minister, promote employment or the development of natural resources or the tourist industry or are otherwise in the public interest or in the interest of the economy of Zimbabwe”.

The issue of public interest is highly subjective. Furthermore, it is not good law for someone to come up with conditions on public interest issues “as he/she thinks fit”. Public decisions must be open to scrutiny by others, and not give one person a blank cheque to decide for the majority.

The Public Debt Management Office is a mere department under the Ministry of Finance. This simply means that the Ministry of Finance is largely mortgaging the country on its own in violation of the constitutional principles of debt contraction that calls for a participatory approach and effective oversight by Parliament. There is therefore justification for the Office to be set up as an independent commission that directly reports to Parliament.

Section 8 of the Bill talks about a medium-term debt strategy for managing the public debt that shall be formulated by the Minister with the assistance of the Public Debt Management Office. Again, there is no Parliament involvement in coming up with this medium-term debt strategy for the country.

Reporting to Parliament on the performance of loans and guarantees has been taken care of in the Bill. This is provided for in the form of annual and quarterly reports on loans and guarantees that are required to be laid before the National Assembly by the Minister within 60 days of the end of the year and quarter concerned.

Parliament will have to insist on penalties for non-compliance with this provision. The Public Finance Management Act currently says ministers have to report on a quarterly basis to their respective parliamentary portfolio committees on budget performance.

However, virtually all ministries have not complied with the reporting provisions. There are no sanctions for non-compliance.

The gazetting of the Public Debt Management Bill is a welcome development in a country choking under a public debt burden of over $9 billion if one takes into account the taking over by Government of the Reserve Bank of Zimbabwe debt of $1,35 billion. The Bill, however, still needs cleaning up in a few areas in order to have a sustainable public debt management policy in Zimbabwe.

l John Makamure is the Executive Director of the Southern African Parliamentary Support Trust. Feedback: [email protected]