Role of the Central Government in the Financing of Public Institutions
It is possible also that a country has a small minority which is wealthy and pays tax, and alongside this, a majority who pay less, little or no tax at all. When The Legislature accounts for its actions to the majority, it is possible that the wishes of the taxpayers are ignored. In a general election where this situation exists, such as in SA, the candidates seldom use taxation or tax issues as a means to elicit votes. Instead they will make every attempt to lure voters with promises of services – health, housing, etc. In contrast to this, such as in America, tax and taxation policies often become a central election issue.
In the above case, as in South Africa, where there exists not only an unequal distribution of wealth, but also an unequal distribution of national income, the only solution is to restructure the economy. Hopefully this will lead to a more equal distribution of wealth and the means to acquire wealth, so that there becomes a more equal distribution of national income. In short, the aim should be to have as many people paying tax as possible. To arrive at this situation, all people need to be economically empowered. When this is achieved The Legislature would then be accountable to voters and taxpayers because they would both form the majority.
Case Study: Tax payers and votes You can imagine that this is a problem which concerns many people. In some countries a weighted franchise is allowed – taxpayers receive more votes than non-taxpayers. Other countries allow property owners to have more votes. Obviously this would be very unfair in a country which has excluded people from owning property, such as in SA. Whatever the argument, in a situation as described to the left there will always be taxpayers who complain that they should have more say over those who do not pay any tax, or less tax. Here they might not shout: “no taxation without representation”, but instead: “no representation without taxation.”
Financial Control
The Auditor-General The State Auditor or Auditor-General, as the office is known in South Africa, is empowered, by legislation, to determine the way in which the executive authority (the political body responsible for finance) executes the management of public funds. The person who holds this office will audit the financial statements of all Accounting Officers at national, provincial and local levels.
Case Study: Municipal Audits Only 17 municipalities out of the country’s 278 received a clean audit for 2010/11 financial year. Only three: George, Langeberg and Mossel Bay (all in the Western Cape) improved their results over 2009/10. This is not a good track record when one of the cornerstones to democracy is transparency in public finance. A number of municipalities did not meet the deadline with submission of the relevant documents.
Clearly South Africa has a long way to go in terms of providing a fully accountable and transparent government to its people. Cape Town has managed a clean audit for ten years in a row – the only city in SA to do so. She leads the country in showing the way for other local governments to become more transparent and accountable to their residents and tax-payers. Two years ago these were the only ones to offer a clean audit: Mpumalanga’s Ehlanzeni district municipality, Steve Tshwete and Victor Khanye municipalities; the City of Cape Town; the district municipalities of Metsweding (Gauteng) and Frances Baard (Northern Cape); and the local municipality of Fetakgomo (Limpopo).
The 2013 announcement, by the last Auditor-General, Mr Terence Nombembe with the details can be seen here:
http://goo.gl/rwjz4a. The video: Ushering in the Age of Accountability is also relevant here – see
www.Publicfinance4sa.info (Module 2). Find out who the new Auditor- General is and read the vision of this office here:
www.agsa.co.za.
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