Public Finance Management Controls in South Africa play a critical role in ensuring transparency, accountability, and efficiency in the use of public resources. These controls are essential to safeguard taxpayer money and to promote sound governance within national and provincial departments. This regulatory framework is clearly defined in the Public Finance Management Act (PFMA) of 1999, which outlines how public funds must be managed and monitored. Under the PFMA, financial control measures include expenditure limits, performance reporting, internal audits, and compliance monitoring, all of which are vital for maintaining fiscal discipline. Effective implementation of these public sector finance controls not only strengthens government accountability but also enhances public trust in the country’s financial management systems.
National Treasury’s legislative mandate is based on Section 216( I) of the Constitution of the Republic of South Africa of 1996, which calls for the establishment of a national treasury to ensure transparency, accountability and controls in the management of the country’s public finances.This role is further elaborated in the Public Finance ManagementAct (PFMA) of 1999 
The department is mandated to:
- promote national government’s fiscal policy and the coordination of macroeconomic policy;
- ensure the stability and soundness of the financial system and financial services;
- coordinate intergovernmental financial and fiscal relations;
- manage the budget preparation process; and
- enforce transparency and effective management of national revenue and expenditure, assets and liabilities, public entities, and constitutional institutions.
Over the medium term, the department aimed to focus on enhancing fiscal sustainability through implementing a credible tax system; supporting sustainable employment; supporting infrastructure development and economically integrated cities and communities; managing future spending growth, fiscal risk and government’s assets and liabilities; streamlining government procurement; strengthening financial management in government; and facilitating regional and international cooperation.
Enhancing and enforcing a credible tax system
To enhance fiscal sustainability and stability, over the medium term, the department aimed to continue with the implementation of a credible fiscal framework to meet government’s revenue requirements, and the promotion of a fair tax system.This will entail having to balance declining tax revenue with increasing government expenditure priorities.Inits efforts to achieve this, the department will continue to provide responsive tax proposals that target improved environmental sustainability, less inequality and more revenue over the period ahead.
Supporting infrastructure development
The Jobs Fund offers matched funding grants across four windows – enterprise development, work opportunities through infrastructure development, support for work seekers and institutional capacity building. It will continue to crowd-in the private sector and other resources to achieve greater social impact, and seek to disseminate the knowledge and lessons derived through robust evaluations of its portfolio of projects. Since its inception in April 20 I I, the fund has disbursed R6.4 billion to various projects.An additional R 13.4 billion has been raised in matched funding from project partners.
The Cities Public Employment Programme establishes a framework for metropolitan municipalities to propose, develop and secure funding for employment programmes. The funds are intended for initiating new projects or enhancing existing city-led projects such as upgrading informal settlements; maintaining, developing and managing public spaces and assets within human settlements and economic hubs; promoting greening and cleanliness initiatives; enhancing community safety measures; providing environmental services and management; and promoting community tourism.
Supporting infrastructure development and economically integrated cities and communities
The department aimed to continue enhancing the ability of cities and metros to make sustainable contributions to economic development and generate tax revenue by implementing the catalytic infrastructure and development support programme and facilitating conditional grants.
Through the implementation of township economic development strategies in five targeted metros (City of Cape Town, City of Ekurhuleni, eThekwini, Nelson Mandela Bay and City ofTshwane), the cities support programme will continue to provide support for spatialised, integrated and participatory economic development planning.
This is expected to result in 35 catalytic projects over the medium term in strategically targeted areas within metropolitan cities, intermediate cities and rural towns. Similarly, through the neighbourhood development partnership grant, the department will aim to implement urban network plans through 20 infrastructure development projects in targeted metros.The municipal finance improvement programme will continue supporting the financial management reform agenda to address financial management problems in local government.
The department planned to comprehensively redesign the programme in 2024/25 to enhance the support provided to all spheres of government to improve financial management compliance, support, monitoring and oversight in local government.
The department plans to introduce the smart meters indirect grant over the medium term. This grant is aimed at supporting local government efforts to improve efficiency, billing accuracy and service delivery by empowering municipalities to deploy smart meter technology. This is expected to enhance revenue generation and cost recovery, and underscores the department’s commitment to sustainable development and the prioritisation of investing in energy infrastructure at the local government level.
Managing future spending growth, fiscal risk and government’s assets and liabilities
The department continues to implement proactive measures to manage expenditure and maintain fiscal discipline over the medium term to steer the country towards fiscal stability and ensure sustainable growth amid prevailing uncertainties. Central to this is enforcing prudent financial management through financial analysis and oversight, with a focus on reforming the size, structure and efficiency of the state, including state-owned entities. Furthermore, the reviewing of all corporate plans, annual reports and guarantee applications from state-owned entities will continue over the medium term.
Streamlining government procurement
The Office of the Chief Procurement Officer planned to focus on enforcing the procedures in the Public Procurement Act of 2024 to promote transparency and value for money in the public procurement system.
Compliance was expected to be further strengthened by publishing approved supply chain management directives, and increasing the coverage of transversal-term contracts and the rollout and institutionalisation of the strategic procurement framework and good practice guides.
Strengthening financial management in government
The Office of the Accountant-General will continue to promote good financial governance with the aim of improving capacity and competency in all spheres of government and public entities. This entails improving understanding and the practical implementation of financial reforms, which is expected to contribute towards improved monitoring, reporting and enforcement of the legal framework, as contained in the PFMA of 1999 and the Municipal Finance Management Act (MFMA) of 2003. Central to this is the implementation of amendments to the legislative obligations stipulated in both Acts.
The proposed amendments include reviewing the definitional elements of irregular and fruitless and wasteful expenditure. The proposed amendments of the PFMA of 1999 have addressed matters pertaining to the disclosure of these regulatory concepts in the annual financial statements and annual report. The proposed amendments to the MFMA of 2003 will also address how municipalities and municipal entities detect and address irregular expenditure, including the implementation of consequence management.
The department continues to develop the Integrated Financial Management System, which is aimed at enhancing the effectiveness and efficiency of the back-end public service functions
Facilitating international and regional cooperation
The department continues to advance South Africa’s interests through representation in international and regional financial institutions,as well as by managing bilateral and multilateral relationships through regional engagements. Work on the development of the country partnership framework and engagement strategies will continue over the medium term, with focus on the implementation of the Southern African Customs Union’s 2022-2027 Strategic Plan. National Treasury will oversee the implementation of country partnership programmes aligned with the uptake of development funding to South Africa from the African Development Bank Group, the World Bank Group and the New Development Bank. https://credithub.cash/public-finance-management-controls-south-africa