Cep’s response to Budget 2017 |13 December 2016

The Citizens Engagement Platform Seychelles (Ceps), which represents civil society organisations in Seychelles, has welcomed the opportunity to comment and make suggestions on the Budget Address by the Minister for Finance, Trade and Economic Planning last Friday.

Noting that it appreciates the support from the government towards the civil society sector, Ceps says it welcomes the announcement made by the President for more transparency and accountability at all levels in the government.

Having scrutinised the different individual and line allocations to ministries, agencies and other organisations, and in recognition of the need for accountability and transparency, Ceps has made the following general observations and recommendations.

General observations and concerns

1. Use of state assets

Government assets belong to the people of Seychelles and all citizens have a legitimate stake in their management. When the government assigns state assets by lease, loan or otherwise to any entity to manage, there needs to be oversight. This principle applies to all parastatals and government agencies with such mandates and therefore, Ceps recommends that the government ensures that there is a clear procurement procedure and reporting mechanism to ensure that the risk of potential misuse, abuse and misappropriation can be avoided.

Ceps, therefore, highly recommends that all parastatals (e.g., IDC, SPTC, Seypec, STC) are subjected to the government procurement laws and that as prescribed by law, expenses above specific amount must go through the National Tender Board. Even if these parastatals are not receiving a budget from the government but they have government assets and there are government entities hence must not be excluded from the procurement laws.

2. Increase in 2017 budget for particular organisations

Ceps has noted increases in the budget of some organisations, namely the Seychelles People’s Defence Forces whose budget has increased by 70% to R428, 684,000. There needs to be a clear explanation for this major increase. The matter can be taken up by the Finance and Public Accounts Committee (FPAC) of the National Assembly in case of sensitive information.

3. Value for money and quality of service delivery

Ceps is concerned about the value for money and the quality of services delivered by various entities (ministries, agencies and parastatals). It is, therefore, recommended that a Community Score Card developed by the African Development Bank be used by civil society to evaluate whether there has been value for money for the services delivered to citizens by organisations receiving state funds.

4. Social impact assessment

Ceps recommends that the government ensures that there is a social impact assessment (SIA) of the services delivered by organisations receiving state funds. The results of the SIA can be used for justifying increases or reductions in annual allocations, especially if citizens are receiving below par services.

In the same perspective, Ceps requests that there is information on the amount of money spent on programmes and on emoluments and benefits to ensure that there is a justified balance between administrative costs and programme spending.

5. Unintended consequences of programmes

Ceps requests further information about whether there has been feasibility studies and monitoring and evaluation of the social programmes being proposed to ensure that there have been sufficient and adequate measures and procedures in place to ensure that there are no unintended consequences such as further dependency and lack of productivity in the population.

The National Human Rights Commission (NHRC) and the Ombudsman often indicate that they do not have sufficient funds to operate, investigate cases and conduct sensitisation of their services and human rights. Ceps proposes that its human rights-related member organisations can work with the NHRC and the Ombudsman to conduct these sensitisation campaigns.

6. Collaboration between civil society and government

CEPS requests that there is greater cooperation between civil society and government ministries and agencies. Some of the functions of organisations can be undertaken or supported by civil society, such as small grants programmes. This collaboration will allow civil society to conduct sensitisation activities and campaigns for programmes of which the population has less understanding.

Specific concerns and recommendations

1. Clarification on budgetary allocations and categories

Ceps requests that there is a further clear and detailed information on the following allocations and categories, in terms of rationale, objectives, justifications and line allocations:

(a) The Unemployment Relief Scheme

(b) Social Programmes from Government

2. Corporate Social Responsibility (CSR) Tax

Government Entities – the distribution of CSR funds by government owned entities should have independent oversight through a Corporate Social Responsibility Oversight or Monitoring and Evaluation Committee to ensure fairness and transparency.

Private Entities - There must be closer oversight over how CSR donations are made by private businesses, to ensure that its true purpose and intention are respected. Some businesses are creating foundations into which the CSR is paid, and there are no checks on how the funds are then used. This tax was meant to respond to social needs and there must be assurance that this was indeed the case.

3. Tax and revenue collection

In order to maximise revenue collection, tax policies should continually be updated. Policies that merit revisiting are:

(a) Tax concessions given without any expiry date;

(b) Tax concessions given to individual companies as opposed to an industry.

Ceps further recommends that the Seychelles Revenue Commission should conduct a monitoring and evaluation exercise starting with all businesses that obtain government contracts, to ensure that each of these businesses are declaring all their income, at least equivalent to the amount of the contract value with government.

4. Transparency

Ceps requests the following in relation to procurement oversight that:

(a) ALL budget expenditure (including the SPDF) and any other entity whose budget was previously not scrutinised) must be subject to an independent scrutiny. Sensitive items can be divulged to the National Assembly’s FPAC only.

(b) ALL rental payments made by government to non-governmental entities should be listed for public view. Details such as the recipient and amount per metre square should be divulged.

(c) ALL government owned entities should have independent oversight over their procurement proceedings. There are presently many entities which do not receive funds directly from government, but they benefit from holding of government assets (e.g., Island Development Company - IDC) or benefit from government privileges (e.g., Seychelles Petroleum Company - Seypec).

(d) An independent review should be made to ensure that the government is extracting maximum benefit from its outer islands. The review will examine and make public which islands are bringing in a net benefit to the government and how much.

(e) The government should publish a list of all government property leased out, its duration and for what value.

Ceps hopes that the spirit of cooperation, the best interests of the people of Seychelles, transparency, and accountability will be the foremost considerations in which to examine its general and specific observations, comments, suggestions and recommendations. It further hopes that the issues raised will be included in the continuing debate in the National Assembly on the 2017 Budget.

Contributed