The necessity of financial priority determination to meet the changing needs for goods and services in the public sector
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Date
1999-06
Authors
Henama, Bukelwa Lorraine
Journal Title
Journal ISSN
Volume Title
Publisher
University of the Free State
Abstract
The legislature of the Republic of South Africa is elected on the basis that it
will deliver certain goods and services to the electorate. Financial priority
determination ensures that resource allocations are directed towards
achieving the results that the government promised the electorate. Through
priority determination, state funds are directed according to policy priorities
Financial priority determination has been found to be the most difficult part of
financial planning and management because it warrants certain expertise
from the public officials which this paper addresses in the form of required
steps and phases to determine financial priorities. Without the understanding
of the phases and steps, priority determination becomes impossible as they
determine the criteria used to make decisions.
As a result of the changing and increasing needs of the population, the
Republic of South Africa experiences severe budget constraints which create
the incentive for financial prioritisation, and this forces the departments to
evaluate whether their existing policy objectives are still valid, how they have
changed and what effect the policy objectives have on programmes. The
constraints of the macro-economic policy framework with increasingly lowered
deficit targets have also increased the need for prioritisation.
It is imperative to consider all the factors that have a bearing on financial
priority determination, such as the general environment in which financial
priority determination is done; factors that determine the state of community
life; needs and expectations of population; policies of the political parties;
and research and experiences of public officials. When such factors are
taken into account, the process of financial priority determination becomes fair
and right.
The impact of financial priority determination on the ROP is important because
the public sector strives towards reaching the priorities of the ROP. It has
been important to reflect on the basic principles and the key programmes of
the ROP from which sustainable development has been identified as the ROP
priority. Measures have been identified to ensure meeting of sustainable
development as an identified ROP priority. Through these measures,
sustainable development would be attained.
and expected results.
This paper points out that in the face of limited resources and the massive
demand for public goods and services, it is inevitable that the government
cannot hope to meet all the aspirations of the electorate. Instead the
government has to choose which sectors must be emphasised in the
allocation of resources, indicate from which sectors resources should be
withdrawn and redeployed and the order in which these things should be
done. This process of choosing which sectors must be emphasised is called
financial priority determination.
The government policies and strategies to ensure meeting of identified
financial priorities in the public sector are tools and instruments through which
the public officials could ensure implementation of financial priorities. South
Africa is characterised by severe inequalities and poverty of the majority of its
inhabitants. Sustainable development is the means through which the society
will be relieved of severe poverty although it would be difficult to bridge the
inequality gap.
Reference has been made to the challenge of economic growth and
development facing the Free State Provincial Government to show how this
province plans on ensuring economic growth and development.
Public officials implement the policy priorities of the government and they
have to be guided by basic values and principles to meet the goals of the
government. These basic values and principles become the expectations
from the public officials in their endeavour to determine financial priorities and
in the process of implementing the priorities.
This document spells out how financial priority determination is linked with the
delivery of public goods and services. If allocation and use of resources is
done in an ad hoc manner, without priority determination that could lead to
poor public sector performance and the needs of the public would remain
unsatisfied. It can be summarised by saying that financial priority
determination allows for more effective use of limited resources.
Description
Keywords
Civil Service -- South Africa, Government business enterprises -- South Africa -- Finance, South Africa -- Politics and government, Dissertation (M.P.A. (Public Management))--University of the Free State, 1998