Educating local government

Ilse Lubbe from the UCT College of Accounting
ilse lubbe.jpg

The need for better education in our local government sector, is one that cannot only be tackled by private institutions of learning. Government has to come to the party - and by the look of things, they are.

With the Minister of Cooperative Governance and Traditional Affairs’ plan to bring local government ‘back to basic’, a back to school approach could also be necessary to ensure a more effective, operable state of municipal governance.

Ilse Lubbe, associate professor and convener at the Public Sector Accounting course at UCT’s College of Accounting, says the need to educate local government ties in directly with service delivery, leadership and accountability in municipalities and this has often been the topics of conversations and mass action more recently. She points out that reports by the Auditor-General of South Africa (AGSA) have also emphasised the challenges relating to skills shortages in municipalities, relating to accounting, reporting and financial management in general.

Municipal training has recently for the first time been formally introduced as official courses at universities and colleges which opens many doors for municipal staff – and those interested in entering this work space, to better equip themselves for the huge task of raising the level of local government and public sector competence.

With the launch of UCT’s College of Accounting also came a new breakthrough in local government education – the introduction of a course created in collaboration with government and National Treasury. The new postgraduate diploma in Public Sector Accounting (PSA) will address the critical financial skills shortage in the public sector and is the first accounting programme of its kind in South Africa.

According to Lubbe, meetings with government officials, auditors and chartered accountants revealed that there’s a great need for more financial expertise at middle and senior levels of government. “That’s why the National Treasury was so eager to be involved, it (the department) sees a direct link for them to build capacity,” she says.

The cirriculum

National Treasury also contributed to the development of part of the course curriculum, which focuses on four key areas: public sector financial reporting, public sector structures and functions, audit, risk management and ethics, as well as public financial management. Part of the curriculum includes detailed explanations of the various statutes and regulations and controls and audit mechanisms officials deal with daily.

Lubbe says an important part of the curriculum works towards enhancing attributes such as leadership, team interaction, communication and critical thinking skills. An essential element of the course is lectures facilitated by external experts in the public sector, who help students gain knowledge on current developments in the field, as well as develop insight into the practical application of theoretical and technical concepts, and gain a holistic understanding of issues affecting the public sector.

“The intention is to benefit not only public sector organisations by addressing skills deficits, but to enrich the career opportunities of individuals already working in the field,” she says.

According to Lubbe, government, in general, in South Africa needs knowledge and capacity. “Many CFO (chief financial officer) positions are not filled with people who hold the necessary academic qualifications, which is part of the reason financial reporting in the country’s public sector is not up to scratch,” Lubbe says.

Municipal training

As Lubbe highlights, “there are several ‘official courses’ at universities and colleges.  However, most of these courses are short term training courses, for one week, or one month, or up to three months courses, with an assessment and certificate. These courses are essential for continued staff development and training in the public sector (mainly municipalities),” she says.

To bypass this issue, Lubbe says the newly developed UCT course, at the postgraduate level, focusses more on “education than training”. As she explains, the year-course has educational principles that encourage a broader view of issues and development of critical thinking, meaning that students are not necessarily ‘trained’ for a job, but rather ‘educated’ to think about why, and consider the how, making informed decisions about what may work, what may need change.  The aim is thus on obtaining a well-rounded knowledge about financial management, the architecture of government, financial reporting and auditing in the public sector.

“To our knowledge, this is the only programme in SA that combines the administrative issues (regulations and legislature), financial management, financial reporting and auditing in the public sector. There is currently no specific qualification in SA that focuses on the financial reporting requirements contained in Generally Recognised Accounting Practices (GRAP).

“GRAP is accounting standards issued by the Accounting Standards Board (ASB) in terms of section 89 of the Public Finance Management Act (PFMA), Act No. 1 of 1999. These standards are developed in alignment with the International Public Sector Accounting Standards (IPSAS), with the aim to improve comparability at different governmental levels globally, as well as amongst the different spheres of government in South Africa. The ASB issues GRAP standards based on all currently published IPSAS that are relevant to the National Treasury in South Africa. GRAP would be applicable to all levels of government (national, provincial and local), all public entities, parliament and provincial legislatures,” she told Service magazine.

Lubbe further explains that currently, all municipalities are required to prepare financial statements in accordance with GRAP. However, due to the skill shortages in municipalities, outside consultants are often appointed to assist. She says millions of rands are spent annually on consultants, yet there is little improvement in the number of ‘clean’ audit reports for municipalities.

She says provincial legislatures are allowed to apply the modified cash basis, however, for financial periods commencing on or after 1 April 2015, all trading entities, parliament and the provincial legislatures are required to prepare their financial statements in accordance with the Standards of GRAP (Refer to ASB, ED128, 2014).

Skills development

National Treasury has emphasised the need to establish ‘professionalism’ in the public sector, specifically for CFO’s. This implies a combination of a qualification at a postgraduate level, as well as skills such as accountability, leadership, responsibility, and other graduate attributes, according to Lubbe.

“We have a combination of students enrolling for the UCT postgraduate programme. The class of 2015 comprises of students who graduated last year, and students who are working within the public sector, and who are now looking to improve their education. We hope to continue with the combination of newly graduates, and currently employed students who have some ‘on the job’ experience,” Lubbe explains.

Lubbe also says local government (in fact, all spheres of government) will benefit from better educated CFOs. According to her, graduates would acquire skills relating internal controls and systems, risk management, performance management, governance issues, and financial management, which will hopefully improve the service delivery, planning and accountability of municipalities.

“Over time, we hope that some students will be encouraged to seek employment at the local government in their home town, and not only stay in the bigger cities.  We also plan to offer this programme on a blended learning platform in the near future, which will provide the opportunity for current employees in the rural municipalities to participate,” she concludes.

Amera Daniels





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Issue 68