A fiscal policy that propels the rand to run an extra mile

In 2009, the Department of Planning Monitoring and Evaluation (DPME) adopted the principle of evidence-based policy and decision making in the planning, budgeting, delivery, monitoring and evaluation of government programmes.

Currently, government maintains separate information systems for finance and service delivery. These systems are not integrated, and were not designed with essential data insights in mind. This limits their usefulness to policy and decision makers who require accurate and timely insights to support their functions. The Minister of Finance, Pravin Gordhan, lamented in his Medium Term Budget Policy Statement (MTBPS) that “…we face difficult choices about how best to use the limited resources we have, and how those resources will be shared in a time of great need.”

The currently in-progress implementation of Municipal Standard Chart of Acccounts (mSCOA) and planned Integrated Financial Management System (IFMS) promise to integrate and improve the quality of available government data. Additionally, government will need to invest in data analytics capabilities that will help transform the data into valuable insights that can be used to:

• Identify additional sources of revenue 
• Identify areas where excessive spending would be minimised and the resultant impact on other spending priorities 
• Identify and remove inefficiencies in public spending 
• Monitor the level and quality of service delivery from a single point and identify hot spots for increased frontline service delivery monitoring visits 
• Predictively identify transactions that are symptomatic of fraud before payments are processed. This will proactively deal with fraud and corruption and limit losses and wastage. 

We expect the Budget speech that will be delivered in February 2017 to provide more details on funding allocations for the implementation of these first steps towards an insights driven fiscal policy formulation and service delivery monitoring.

The IFMS and mSCOA are major business reforms for the South African government. As part of their implementation, innovative ways of resourcing skills development in the areas of electronic information management, data analytics and data science can be improved within the public service. Partnering with the private sector to implement on-the-job learning is a potential solution that should be considered.

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