PAC’S BID TO STALL PASSING OF LOAN BILLS

LOBAMBA – The Public Accounts Committee (PAC) has vowed that it will recommend to Parliament that no loan Bill should be passed until government establishes a Public Debt Monitoring Committee.This leaves two loan Bills that will be tabled today by the Minister of Finance, Neal Rijkenberg, among others, hanging, should the PAC recommendation be adopted by the House of Assembly. The Chairperson of the PAC, who is also the Deputy Speaker in the House of Assembly, Madala Mhlanga, made the promise yesterday when the Ministry of Finance was before the committee in Parliament. The Mhlangatane MP commented after the Auditor General (AG), Timothy Matsebula, raised an audit query about the absence of a Public Debt Monitoring Committee.

“The Public Debt Management Unit under the Ministry of Finance does not have a Public Debt Monitoring Committee, which talks to the government issue of monitoring debt. The committee should also include the Financial Services Regulatory Authority (FSRA) and the Central Bank of Eswatini (CBE),” he said.The AG said the Public Debt Policy 2021 states that the Public Debt Monitoring Committee shall be established. The committee is crucial in ensuring that the country manages its public debt and borrows responsibly. He said the governance structure needs to have the committee. The committee would examine the feasibility of projects that would be requested by a government ministry and further look at the economic benefits of that proposed project.

The AG raised the audit query in the Financial Audit Report on the Consolidated Government Accounts of the Kingdom of Eswatini for the Financial Year ended March 31, 2022. When the query was raised, Matsebula said the unit had received Cabinet approval to establish the committee. Yesterday, the Principal Finance Officer, Lomagugu Ntshakala, from the Public Debt Management Unit in the Ministry of Finance, told the PAC that the committee had not been established despite its crucial importance in public debt management. “We are raising a paper for Cabinet approval as it will be touching on other ministries.

It is true that we should have that committee as the policy states, to be in a position to know if a project needs to be undertaken or not. Once the Cabinet paper we are raising is approved, we will be in a position to send letters to the relevant ministries that would form part of the committee,” she stated.The PAC chairperson questioned what other forms of approval they needed since they told the AG in their earlier submitted responses that they received Cabinet approval. He also questioned who was monitoring the public debt in the absence of the committee and what the country’s public debt percentage against the gross domestic product (GDP) was.  “Who sets the thresholds and monitors the public debt in the absence of the committee?” he asked.

Conflict

Kubuta MP Masiphula Mamba wondered if there was not any conflict of interest from the team that was calling the shots in the absence of the committee which result might deliberately delay the formation of the committee, to prevent the inclusion of FSRA and the CBE. “The committee is crucial, because it will not only have government officials but the private sector would be included,” he said.Dvokodvweni MP Sifiso Shabalala noted that the country’s public debt is not healthy. He said he feared that the country could end up drowning in debt. “Can you try to speed up the process of forming the committee, to prevent a situation where the country would completely run on debt,” he said.

Ntshakala, in response, said the approval they needed after the first one was for inviting the ministries that would be affected in the formation of the committee. She also stated that the country does not have a locally set threshold, but relies on recommendations of the International Monetary Fund (IMF) that advises the country to keep the debt ratio to the GDP below 35 per cent. “However, due to issues beyond our control, we have seen the country in a debt level which is above the 35 per cent and at one point, it was 40 per cent. As of the end of June 2024, the ratio was 38 per cent to the GDP,” she said.The principal finance officer stated that currently, the Ministry of Finance, as well as that of Economic Planning and Development, run the show in terms of deciding loans for projects that need to be implemented after a request from a ministry that needs the project. “Currently, ministries come with projects and are implemented without the scrutiny that would be applied by the committee,” she said.Ntshakala stated that the way things are carried out is risky for the country.

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