Coordinating ﬁnances for better service delivery
The coordination and collaboration of the three spheres of government is important for
the smooth running of government and gives ordinary citizens equitable access to basic services in South Africa.
However, some municipalities and provinces do not always have enough money to actually deliver on all services as expected.
PSM spoke to Malijeng Ngqaleni, the Deputy Director-General responsible for the Intergovernmental Relations Division of National Treasury, to understand how the three spheres of government work together to ensure that the state’s revenue is used for the benefit of all citizens.
The main mandate of her division is to coordinate fiscal and financial relations in national, provincial and local government.
Ngqaleni said part of her job is to manage the division of revenue and allocation of money between the three spheres of government. She is well suited to the job thanks to her thorough educational background in economics.
“I obtained my first degree in economics from the University of Lesotho and worked there for a while as a lecturer in economics. I have also lectured in agricultural economics at the University of the North (now the University of Limpopo) and I obtained an MSc degree in Agricultural Economics from the University of Saskatchewan in Canada,” said Ngqaleni.
Her first job in government was at the Department of Rural Development, where she was responsible for the monitoring and impact analysis of land reform. She joined National Treasury in 1998 as a budget analyst and worked her way up the ranks.
Division of revenue
In her current position, Ngqaleni focuses mainly on solving the problems that prevent money from reaching the people on the ground.
“Free basic services are funded by the national government. South Africa’s Constitution provides for the division of nationally raised revenue between the three spheres of government to enable them to deliver on their mandates,” she explained.
“The Constitution allocated functions to municipalities, provinces and national government, and it also allocated them the revenue raising responsibility,” she added. To come to an agreement on how to divide resources between the three spheres of government,
National Treasury uses the Intergovernmental Fiscal Relations Act to consult with the provinces through the MECs of Finance, as well as local government through the South African Local Government Association (SALGA).
“This is to ensure that the allocations are fair and equitable, and will enable them to deliver on their mandates,” said Ngqaleni.
“At the end of the day, it is important to remember that government does this to ensure that its pro- grammes benefit ordinary citizens who need services,” she explained. “The Constitution states that everyone, irrespective of where they are, must have equitable access to basic services. So, the allocations make it possible for people even in rural areas to have access to free water, healthcare and education for instance.”
Ngqaleni said planning, reporting and the management of finances in municipalities and provinces are important responsibilities carried out by government to ensure that services are delivered to citizens equitably and without glitches.
First and foremost, she said, people need to understand that the three spheres of government manage their functions concurrently. For example, the National Department of Education is responsible for formulating policies, norms and standards, and provinces have
to implement them. But for implementation to take place, funds are needed, which are allocated by National Treasury.
Ngqaleni emphasised that financial planning is important because it shows whether the budget talks to how the province or municipality is actually prioritising the delivery of certain services.
“Because we give provinces and municipalities allocations on a three-year basis, we actually enable them to plan ahead. It also helps National Treasury to review plans drafted by municipalities and provinces before they can be implemented,” she explained.
“We allocate resources on a three-year cycle to ensure a degree of certainty and predictability in the flow so that plans for spending can be made ahead of the year of implementation,” she added.
National Treasury takes into account the demand for services and the capacity of municipalities and provinces to raise revenue.
Ngqaleni added that National Treasury assesses the plans and budgets to ensure that they are aligned and that budgets are funded from the revenue received and raised by the subnational; they then give effect to govern- ment priorities.
“We are able to advise the prov- ince or municipality whether its budget is funded, credible, suitable and relevant,” she said.
For instance, now that government is approaching the 2019/20 financial year, National Treasury is helping provinces and municipalities this financial year to finalise their plans, including Integrated Development Plans and budgets. “Financial planning really translates into budgets that actually give effect to the priority of government’s delivery of services.
From the budgets, the people will know what it is that the municipality or province is planning to deliver
for them, and what choices have been made since the needs are too many,” she said.
When it comes to financial reporting, Ngqaleni said it is important because it enhances transparency and accountability to taxpayers, and strengthens coordination as it informs the national departments on how they are performing.
“The concept of transparency is very big in our system, because if the national department is respon- sible for education and yet education is delivered by provinces, they want to know whether that delivery is happening,” she said.
Reporting provides information to the national government that is responsible for a certain function, it gives information to legislatures or Parliament on a quarterly basis, and it reflects on performance. “Reporting becomes very important for intergovernmental coordination. It also provides for early warning so that if there is a problem, the national department can try to implement measures to address the problem,” she added.
Financial management is about making sure that the resources are used according to plan and that they are able to achieve the set objectives of delivering the service to the people.
Management of finances also ensures that there are internal controls in order to mitigate wasted resources and irregular spending, Ngqaleni explained.
“Coordination and alignment of policy, planning and implementa- tion is important in our concur- rent system in the delivery of most services.”
Ngqaleni said National Treasury also provides provinces and mu- nicipalities with technical support for financial management.
“We also support provinces through the Infrastructure Delivery Improvement Programme to help them implement their programmes. In 2003, when we started with them, they could not spend almost R6 billion on infrastructure, but now they are spending almost R50 billion on that,” she noted.
“We assist municipalities to prepare budgets that fund their prioritised plans, on how to manage their finances and to report on performance.”
Facing challenges head on
Ngqaleni’s job does not come without challenges and she feels that the biggest one is the silo mentality that most government officials and departments have. “Government has to collaborate and coordinate to deliver effectively, but what we have at the moment in government is that everybody wants to do their own thing,” she said.
She has learned that effort and time are necessary tools when it comes to building relations and planning together.
As a woman in a leadership position, Ngqaleni said she does not always look at challenges in the context of being a woman, but she looks at people and understands that people can be difficult.
“When I look at men, I realise that most of them have too big egos to be the kind of people that are open about their weaknesses, because they are meant to always be strong and have this competitive spirit,” she explained.
“This is what makes it more difficult to get them to work in teams and perform to their level best,” she added.
Ngqaleni said working in teams requires one to build trust and building trust means that people should be vulnerable, be willing to accept things that they do not know, acknowledge their mistakes and ask for help where necessary.
“My policy is to actually work more on myself than others, because sometimes it is not about what happens to you, but the meaning you give it and how you respond.”
She said it is not always necessary to look at problems from a gender perspective.
When the time comes for her to retire, Ngqaleni said she would like to be a life coach and to work with civil society organisations.
This is because she has realised that there is an increase in mental problems even in the
work environment, which requires support for people to be skilled in how to manage themselves and their workload to avoid destructive stress and being overwhelmed.
As a person who always looks for solutions to problems that contribute to the smooth delivery of services, Ngqaleni is also the kind of leader who seeks to empower people that she works with so that they can also grow and prosper, and live life in a productive way.