The DA’s and EFF’s urgent court challenges to the VAT hike were “entirely without merit”, said speaker of parliament Thoko Didiza in court papers on Tuesday.
Didiza said the preferences of the two political parties had not carried the day in the “democratic and constitutionally prescribed” process. They therefore “had to turn to the courts to achieve what they could not otherwise achieve”. But in doing so, they had sought to impugn the processes of parliament and its committees.
The DA went urgently to court on April 3, seeking to set aside resolutions of the National Assembly and the National Council of Provinces to accept the fiscal framework reports from the finance committees of the two houses.
Under the Public Finance Management Act and the Money Bills Act, these two committee reports must “include a clear statement accepting or amending the fiscal framework”. The reports are then accepted by the two houses, which then clear the path for parliament to pass the budget legislation.
The DA has also, in Part B of its court case, challenged the section of the VAT Act that allows the minister to amend the VAT rate, saying it is unconstitutional. Shortly after the DA went to court, the EFF applied to intervene in the case on similar grounds.
Parliament is opposing both cases only insofar as they relate to the process followed by its committees and the acceptance of the report by its two houses. The minister of finance is expected to file court papers in defence of the VAT Act.
The DA said the process followed in parliament was illegal and invalid because final reports were never put before the committees for adoption. “Nor was the question ever directly posed to the committees whether they accepted or amended the fiscal framework,” said the DA’s Helen Zille in the party’s court papers.
But Didiza said “there was no illegality in the process”.
Setting out what happened, she said that, at a joint meeting of the NCOP’s select committee on finance and the National Assembly’s standing committee on finance, the fiscal framework was first considered and debated.
While amendments to the framework were proposed by the EFF, MK Party and the DA, these were not accepted by the majority of the committee. Instead, a non-binding recommendation on the VAT issue was proposed by ActionSA, which got the support of the majority. This was included in the report, she said. The other proposals for amendments were reflected in the report as proposals.
As at April 1 there was a single fiscal framework in place. The role of the committees was either to accept the fiscal framework or amend it. There is no uncertainty or ambivalence in the proceedings that this is precisely what the committees did, the result of which is reflected in the acceptance of the report
— Thoko Didiza, National Assembly speaker
“At the end of the joint meeting, the draft report (version 1) with the agreed amendments was accepted and adopted,” said Didiza.
She said the versions that followed, in respect of the standing committee report, reflected amendments to the report made during deliberations. But these were “proposals, which were not agreed to by the majority of the committee”. With the NCOP’s select committee, the final report accurately reflected that the DA, MKP and EFF proposed amendments to the Fiscal Framework.
Didiza “denied the correctness” of the DA’s claim that a clear statement accepting or amending the fiscal framework was never put to the committees for final adoption and never appeared in the versions of the reports that the committees considered.
“As at April 1 there was a single fiscal framework in place. The role of the committees was either to accept the fiscal framework or amend it. There is no uncertainty or ambivalence in the proceedings that this is precisely what the committees did, the result of which is reflected in the acceptance of the report,” she said.
She said she did not accept that the “final report” had to be put before the committees for adoption. The committees determined whether they adopted the report and this meant a clear acceptance of the fiscal framework, she said.
Didiza also rejected the DA’s claim that the adoption of the fiscal framework was based on a “material error of law” because MPs believed that a non-binding recommendation that the VAT increase would be reconsidered would halt its implementation.
“The DA may not speak on behalf of other parties and/or individual,” she said. This position was also not supported by what was said at the meeting.
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