Integrating policy, planning, budgeting and reporting processes is essential for achieving the country’s planned medium and long term developmental results.
Integrating policy, planning, budgeting and reporting processes is essential for achieving the country’s planned medium and long term developmental results. In particular, planning and budgeting processes must be aligned so that development priorities are budgeted for during the planning cycle; and implementation of plans to achieve the developmental results, using the allocated budgets, must be tracked. In the first quarter of each financial year, the Department of Planning, Monitoring and Evaluation issues the Budget Prioritisation Framework, outlining medium term priorities that must inform the budget allocation process for the next financial year.
Through the planning process, oversight institutions ensure that medium term priorities are reflected in institutional Strategic Plans and Annual Performance Plans.
In 2012, South Africa adopted the National Development Plan (NDP) 2030. This sets out the vision for the country. Constitutional and legislative mandates as well as international and regional priorities informed the contents of South Africa's National Development Plan.
All national, provincial and local government institutions must ensure that the National Development Plan priorities are reflected in their institutional Strategic Plans and Annual Performance Plans, as described in the Medium Term Strategic Framework for the relevant planning cycle. Through strategic planning processes, each institution must establish planning processes which are focussed on results.
The Medium Term Strategic Framework (MTSF) outlines the country priorities of the electoral mandate and provides a medium-term roadmap for developing five-year institutional plans to enable the National Development Plan’s goals to be achieved.
Intergovernmental and interdepartmental planning is crucial to achieving government’s priorities and vision for South Africa. The Medium Term Strategic Framework promotes coordination and alignment of priorities across all spheres of government and with non-government stakeholders and assists with integrating all components of national development into mainstream planning processes.
The MTSF ensures a coherent vision and plan that addresses the priorities including those relating to women, youth and people with disabilities. It is a roadmap for developing five-year institutional plans. Government’s contribution to the Medium Term Strategic Framework is measured through a monitoring framework with related indicators and targets.
The purpose of the Spatial Development Frameworks (SDFs) is to radically change the rationale for and rules by which planning, budgeting and infrastructure investment and development spending in the country take place.
Spatial transformation and inclusive economic growth remain elusive despite an enabling legislative and policy environment. Spatial planning, infrastructure investment and social development expenditure by the post-apartheid state and the private sector have reproduced, entrenched and in some cases reinforced these historic spatial patterns.
Strategic Plans reflect the intended institutional outcomes that will help to achieve government’s priorities and realise the institution’s mandate. Strategic Plans institutionalise the priorities set out in the National Development Plan; the Medium Term Strategic Framework; Spatial Development Plans; provincial, sector and local government priorities; and any other government medium and long term plans.
The Strategic Plan informs the Annual Performance Plan of the institution, whose strategic focus must be linked to the allocated budget based on its mandate. Strategic Plans identify strategically important outcomes orientated goals and objectives against which public institutions’ medium-term results can be measured and evaluated by Parliament, provincial legislatures and the public.
Each government department publishes its strategic plan on its website. The Strategic Plans can typically be found under the publications, resources or documents tab.
The Annual Performance Plan describes the institution’s intended outputs that will enable it to achieve the outcomes and impact statements in the Strategic Plan. The Annual Performance Plan outputs must inform the budget and must include the audited performance of the past three planning years, the estimated performance for the current year and forward projections for the medium term period.
Annual Performance Plans identify the performance indicators and targets that the institution will seek to achieve in the upcoming budget year. These performance indicators and targets are aligned across an institution’s annual plans, budgets, in-year and annual reports. The process for the production of the Annual Performance Plan is aligned to the budget process.
Each government department publishes its Annual Performance Plan on its website. The Annual Performance Plans can typically be found under the publications, resources or documents tab.
Annual operational planning is the mechanism by which institutions plan how they are going to carry out the activities in, and achieve the outputs of, the APP and is a crucial part in the institutional planning process. An Annual Operational Plan (AOP) describes the activities and budgets for each of the outputs and output indicators in the Annual Performance Plan. Annual Operational Plans also include operational outputs which are not reflected in the Annual Performance Plan. Annual Operational Plans can be developed for an institution and/or for branches or programmes within an institution.
Each programme and sub-programme mentioned in the Annual Operational Plan is consistent with the Budget Programme Structure approved by National Treasury. The activities contributing to sub-programmes’ outputs are indicated in the Annual Operational Plan, including those related to operational outputs that are not in the Annual Performance Plan. The start and end dates for each activity must be given. The institution must cost each activity based on the sub-programme’s allocated budget.
Government institutions are not required to publish their Annual Operational Plans on their website. It is the department’s prerogative to publish as the Annual Operational Plan is not tabled in Parliament.
Through the annual budget guidelines, National Treasury indicates the process in terms of which departments must budget for identified priorities communicated by the Department of Planning, Monitoring and Evaluation. Institutions must ensure that the medium term priorities are reflected in their plans, budgeted for, measured, and reported on a quarterly and annual basis through the established reporting processes.
The purpose of the annual Budget Prioritisation Framework is to guide government during the budget allocation process for the coming financial year. It also assists government to ensure that budgets are aligned with implementation of the Medium Term Strategic Framework priorities and assists the Medium Term Expenditure Committee with making recommendations to the Ministers’ Committee on the Budget and to Cabinet.
Through the annual budget guidelines, National Treasury indicates the process in terms of which departments must budget for identified priorities communicated by the Department of Planning, Monitoring and Evaluation. Institutions must ensure that the medium term priorities are reflected in their plans, budgeted for, measured, and reported on a quarterly and annual basis through the established reporting processes.
The MTEF initiates a process of rolling three-year budgets, giving national and provincial departments providing agreed spending trajectories within which to plan.
Improved efficiency is fundamental to the delivery of more and better services to South African society. Government will not have transformed South Africa until it has delivered better housing, sound education, basic health care, a welfare support network for those who have no other means of support, proper roads to underpin the economy and effective protection against crime. To achieve this, substantial efficiency improvements in service delivery are required. The MTEF provides an initial analysis of the efficiency of service delivery and indicates areas which demand more attention. By linking inputs to outputs, the MTEF makes it the responsibility of both national and provincial departments to demonstrate the efficiency with which South Africa’s scarce resources are employed.
Technical guidelines to Provinces and National Departments about their budget submissions give anyone analysing public budgets a sense of the main principles guiding budget submissions. The Estimates of National Expenditure provide information about the spending plans of National Departments. The Estimates of Provincial Revenue and Expenditure provide information about the anticipated revenue and spending plans of Provincial Departments.
The technical guidelines to Provinces and departments about their budget submissions can be found here: http://www.treasury.gov.za/publications/guidelines/
Vulekamali is a project by the South African National Treasury and IMALI YETHU
