Report Back; Adoption of Resolutions on Presidency, Health, Provincial & Local Government, Public Service & Administration, PSC, SAMDI, Sports & Recreation, Water Research Commission, SA Medical Research Council, Environmental Affairs & Tourism, Commissio

Meeting report

STANDING COMMITTEE ON PUBLIC ACCOUNTS
11 September 2002
REPORT BACK; ADOPTION OF RESOLUTIONS ON THE PRESIDENCY, HEALTH, PROVINCIAL AND LOCAL GOVERNMENT, PUBLIC SERVICE AND ADMINISTRATION, PSC, SAMDI, SPORTS AND RECREATION, WATER RESEARCH COMMISSION, SA MEDICAL RESEARCH COUNCIL, ENVIRONMENTAL AFFAIRS AND TOURISM, COMMISSION FOR GENDER EQUALITY; MR LOWE'S LETTER AND NEWSPAPER INTERVIEW, MS DUDLEY'S INTERVIEW: DISCUSSION

Chairperson: Mr F Beukman (NNP)

Documents handed out:
Resolution on the Commission on Gender Equality (Appendix 1)
Resolution on the Medical Research Council (Appendix 2)
Resolution on the Provincial and Local Government (Appendix 3)
Resolution on the Public Service Commission (Appendix 4)
Resolution on Sports and Recreation (Appendix 5)
Resolution on SAMDI (Appendix 6)
Resolution on the Presidency (Appendix 7)
Resolution on the Public Service and Administration (Appendix 8)
Resolution on the Water Research Commission (Appendix 9)
Letter to SCOPA Chairperson from Mr M Lowe (MP) (Appendix 10)

SUMMARY
All resolutions were adopted by the Committee after report backs from the working groups. The Committee also discussed the interview given by Mr Lowe (DP) with regard to a particular SCOPA meeting. Members felt that Mr Lowe's information broke the confidentiality of Committee decisions. Mr Lowe defended himself by stating that he gave the interview to clarify misconceptions. However, Members were not satisfied and Mr Lowe apologised. The Committee also discussed an interview given by Ms Dudley (ACDP) in which she alleged that she was targeted by an ANC Member when she first sat on SCOPA. The two items were initially conflictual in their discussions but were resolved. Ms Dudley apologised for mentioning SCOPA and felt as if the Member no longer targeted her.

MINUTES
Report Back
Mr Gumede (ANC) informed the Committee that both the reports on the President's Fund and on the Gender Commission were ready to be tabled to the plenary.

Ms Hlangwana (ANC) reported back on the Parliament and GCIS reports. On the Parliament report, she said that they still needed to communicate with the Auditor General and was not sure whether there was a need for a hearing. She added that while there was a need for a hearing on GCIS, there would be a need for a hearing on SITA and ICASA.

Resolutions (See Appendices)

The following resolutions were adopted:
Presidency,
Health,
Provincial and local government,
Public service and administration,
Public Service Commission,
SAMDI,
Sports and recreation,
Water research commission,
SA medical research council,
Environmental affairs and tourism
Commission for gender equality

International Study Tours
Mr Lowe (DP) thought that it was unfair that only eight members could be selected to go on international study tours when all Members equally work hard. He suggested that international study tours should be undertaken biennially by all Committee Members.

Mr L Chiba (ANC) rejected Mr Lowe's idea. He reckoned that there was not enough money to send all Members and that it was not wise to wait for every two years because unused funds were not saved for the following financial year but re-transferred to the National Treasury.

Mr V Smith (ANC) added that the issue of international study tours was not a matter of Parliament rules but rather the business plan of the Committee. He suggested that the matter should not be discussed any further than it went.

Letter by Mr Lowe
Mr Lowe had written to the Chairperson requesting the addition of his item to be placed on the agenda. The item was his dissatisfaction with the media's inaccessibility to a particular SCOPA meeting without " good and cogent reasons". (see Appendix 2)

Mr Smith (ANC) explained that it was agreed by the Committee that cluster meetings preceding the public areas should be in-Committee. The reasons for this were not create and environment to expedite and effect content to be brought before the plenary and public hearings. He reckoned that the media was a hurdle for the Committee to grapple with issues before hearings took place. He also challenged Mr Lowe to prove that such a mechanism was detrimental to the Committee and undermining transparency.

Mr Gumede and the Chairperson agreed with Mr Smith and added that cluster meetings empowered and prepared Members for plenary and public hearings.

Mr Kannermeyer (ANC) reckoned that Mr Lowe's letter indicated that he made no research into Committee minutes to find out if there was such an agreement about cluster meetings. Mr Nair (ANC) and Ms Hlangwana (ANC) and Mr Mofokeng (ANC) reiterated the point too.

Mr Lowe (DP) perceived the members' response as over-reactive. He declared his Constitutional right to this matter and he maintained that cluster meetings should be transparent too.

Mr Lowe's Newspaper interview
Mr Smith (ANC) put on the agenda the issue that Mr Lowe was quoted in a newspaper in which he gave an interview. According to Mr Smith, Mr Lowe's information broke the confidentiality of Committee decisions. Mr Lowe defended himself by stating that the journalist who approached him already had some information which he received from anonymous SCOPA Members. He therefore gave the interview to clarify misconceptions. He was simply telling the truth and he was proud that unlike "faceless" Members, he was open with the information he gave to the journalist.

Mr Kannermeyer (ANC) suggested that the Democratic Party should publicly state its position with regard to Mr Lowe's response.

Dr Koornhof (UDM) was not pleased with Mr Lowe's response. He regarded such acts as "bordering on betrayal" and suggested that Mr Lowe apologised.

Mr Lowe apologised to the Committee.

Mr Mofokeng (ANC) demanded a public apology, but the Chairperson suggested that the matter should not be dealt with in the meeting at that moment.

Ms Dudley's Newspaper Interview
Ms Hlangwana noted a newspaper article in the Sunday Argus, 25 August 2002, in which Ms Dudley (ACDP) gave an interview. She was dissatisfied about the bad publicity that Ms Dudley gave to SCOPA. She wanted to know the name of the person that Ms Dudley claimed targeted her when she was new in the Committee.

Ms. Dudley explained the background to the interview and that it was not her intention to harm the reputation of the Committee. She apologised for that. She explained that all she was trying to do was to indicate that the problems women faced in Parliament were not necessarily attributed to males only but to other women too. She apologised for mentioning SCOPA. However, she said that after the article she feels Ms Motlhoagae (ANC) no longer targeted her. She also asked Ms Hlangwana to avail the whole interview copy to SCOPA Members so that they understood the interview and all misunderstanding could be resolved. Ms Hlangwana agreed to this.

The was an altercation between Ms Motlhoagae and Ms Dudley. Ms Dudley interjected and asked the Chairperson to call Ms Motlhoagae to order. The Chairperson sustained Ms Dudley's request and reminded Members not to be personal in parliamentary affairs.

The meeting was adjourned.

Appendix 1
Draft Resolution of the Standing Committee on Public Accounts for Commission
on Gender Equality

Audited Report for the year ended 31 March 2001 (RP 165/2001)

The Standing Committee on Public Accounts, having considered and examined the Financial Statements on the Report of the Auditor-General of the Commission on Gender Equality for the year-ended 31 March 2001 [RP165/2001], referred to it; as well as having considered the responses of the Acting Chief Executive Officer to SCOPA's queries, reports as follows:

(1) Audit Opinion

The Committee commends the Acting Chief Executive Officer and the staff of the Commission on Gender Equality on the basis of the Auditor-General's unqualified audit opinion on both the financial and compliance audits, and trusts that future audit opinions will be equally unqualified.

(2) Forensic Investigation

The Committee further commends the Commission for having instituted a forensic investigation that resulted in a disciplinary hearing, the subsequent dismissal of the staff member concerned, and the recovery of the amount of money involved.
It welcomes the decision to terminate the electronic transfer system of payments, and to revert to the issuing of cheques for all payments, after the authorities have properly scrutinized and signed the necessary documents.

The Committee therefore request that the Commission furnishes SCOPA with a report by 31 October 2002 indicating the success or otherwise of the new method of payment.

(3) Donor Funding

The Committee notes with concern that compared with the previous financial year, the amount of donor funding received by the Commission during the financial year under review decreased substantially, negatively impacting on the Commission's ability to deliver on budgeted projects.
It welcomes the Commission's initiative in engaging its traditional donors for continued funding.

The Commission is requested to furnish SCOPA with a progress report on the matter by 31 October 2002.

(4) Asset Control

The Committee is concerned that control over assets at the Commission is unsatisfactory. It notes however that a physical stock of all assets was taken, and that users had to sign for the assets under their control.
The Committee therefore recommends that the Commission submit a formal report to SCOPA by 31 October 2002 informing it of the successful implementation of the Commission's policy regarding control asset control.

(5) Personnel Records

The Committee notes with concern that certain payroll, personnel and leave
records were either not updated or certain instances did not even exist.
It notes however that all staff files have now been updated, and that the
Commission is currently streamlining the files of all the Commissioners.

The Committee therefore recommends that a formal report be submitted to SCOPA by 31 October 2002, showing the completion of the updating and streamlining process.

(6) Disaster Recovery Plan

The Committee is concerned at the absence of a formal disaster recovery or a business continuity plan at the Commission.
It notes the unsuccessful corrective measures and the temporary nature of the backup measures instituted by the Commission.

The Committee requests that the comprehensive disaster recovery plan furnish SCOPA with a progress report on

(7) Internal Audit

Commission institutes urgently a as a matter of greatest urgency and the matter by 31 October 2002.

The Committee notes that the Commission had outsourced its internal audit function, and that now internal auditors have been appointed.
However, the Committee concerned that no final reports were available for review, and is that consequently no reliance could be placed on the internal audit function.
The Committee requests that the Commission furnish a progress report on this matter by 31 October 2002.

Report to be considered.

Appendix 2:
DRAFT RESOLUTION
SOUTH AFRICAN MEDICAL RESEARCH COUNCIL

The Standing Committee on Public Accounts, having considered the Report of the Auditor-General on the financial statements of the South African Medical Research Council (SAMRC) for the financial year ended 31 March 2001 [RP 122/2001] reports as
follows:

The Committee studied the Report of the Auditor-General and put questions for clarification to the Accounting Officer on matters which, according to the Committee, needed attention.

After considering the written replies, the Committee took note of the steps taken by the Accounting Officer and the staff to fulfil their obligations in terms of the PFMA concerning financial management at the SAMRC. The Committee has resolved not to have a hearing on the report for the year under review, but will put additional questions to the Accounting Officer on matters that needed further attention.

Noting the above, however, the Committee wishes to bring the following to the attention of the Board:

Audit opinion

The Committee commends the Board and staff of the SAMRC for the Auditor-General's unqualified audit opinion on both the financial and compliance audits, and trust that future audit opinions will be equally unqualified.

Report to be considered.

Appendix 3:
DRAFT RESOLUTION
PROVINCIAL AND LOCAL GOVERNMENT

The Standing Committee on Public Accounts, having considered the Report of the
Auditor-General on the financial statements of Vote 22 Provincial and Local
Government for the year ended 31 March 2001 [RP 132/2001] reports as follows:

The Committee studied the Report of the Auditor-General and put questions for clarification to the Accounting Officer of the Department on matters which, according to the Committee, needed attention.

After considering the written replies from the Department, the Committee took note of the steps taken by the Accounting Officer and the staff to fulfil their obligations in terms of the PFMA concerning financial management at the Department. The Committee has resolved not to have a hearing on the report for the year under review, but will await the Auditor-General's Report on the next financial year.

Report to be considered.

Appendix 4:
DRAFT RESOLUTION
PUBLIC SERVICE COMMISSION

The Standing Committee on Public Accounts, having considered the Report of the
Auditor-General on the financial statements of Vote 25 Public Service Commission
(PSC) for the year ended 31 March 2001 [RP 128/2001] reports as follows:

The Committee studied the Report of the Auditor-General and put questions for clarification to the Accounting Officer of the PSC on matters which, according to the Committee, needed attention.

After considering the written replies from the PSC, the Committee took note of the steps taken by the Accounting Officer and the staff to fulfil their obligations in terms of the PFMA concerning financial management. The Committee has resolved not to have a hearing on the report for the year under review, but will await the Auditor-General's Report on the next financial year.

Noting the above, however, the Committee wishes to bring the following to the attention of the Accounting Officer:

Non-compliance with Treasury Regulations

The Committee took note and expresses its concern that the Public Service Commission has no approved write-off policy and the use of suspense accounts that are not cleared each month that resulted in the non-compliance with Treasury Regulations.

The Committee recommends that the Accounting Officer report back to Parliament by 31 October 2002 on the necessary steps taken to rectify this matter.

Report to be considered.

Appendix 5:
DRAFT RESOLUTION
DEPARTMENT OF SPORT AND RECREATION

The Standing Committee on Public Accounts, having considered the Report of the Auditor-General on the financial statements of Vote 30 Sport and Recreation for the year ended 31 March 2000 [RP 13912000] and the Report of the Auditor-General on the financial statements of Vote 29 - Sport and Recreation for the year ended 31 March 2001 (as stated in the Annual Report of the Department), reports as follows:

The Committee studied the Reports of the Auditor-General and put questions for clarification to the Accounting Officer of the Department on matters which, according to the Committee, needed attention.

After considering the written replies from the Department, the Committee took note of the steps taken by the Accounting Officer and the staff to fulfil their obligations in terms of the PFMA concerning financial management at the Department. The Committee has resolved not to have a hearing on the reports for the years under review, but will await the Auditor-General's Report on the next financial year.

Noting the above, however, the Committee wishes to bring the following to the attention of the Accounting Officer:

Unauthorised expenditure previously reported

Expenditure to the amount of R822 460,68 (199912000 financial year) and a further amount of R10 288,69 (2000/01 financial year) was reported as unauthorised expenditure by the Auditor-General. As the Committee is awaiting further information from the Auditor-General regarding these reported amounts, a recommendation will be made at a later stage.

Report to be considered.

Appendix 6:
DRAFT RESOLUTION
SA MANAGEMENT DEVELOPMENT INSTITUTE

The Standing Committee on Public Accounts, having considered the Report of the
Auditor-General on the financial statements of Vote 27 - South African Management
Development Institute (SAMDI) for the year ended 31 March 2001 (as stated in the
Annual Report of SAMDI), reports as follows:

The Committee studied the Report of the Auditor-General and put questions for clarification to the Accounting Officer of the Department on matters which, according to the Committee, needed attention.

After considering the written replies from the Department, the Committee took note of the steps taken by the Accounting Officer and the staff to fulfil their obligations in terms of the PFMA concerning financial management. The Committee has resolved not to have a hearing on the report for the year under review, but will await the Auditor-General's Report on the next financial year.

Noting the above, however, the Committee wishes to bring the following to the attention of the Accounting Officer:

1. European Union claims

The Committee expressed its concerned on the outstanding claims against the European Union (EU) to the amount of R2, 2 million for services rendered by SAMDI. The Committee further took note of the steps taken by the Accounting Officer to finalise this matter. The Committee is concerned that in the event of the EU not settling the claims, the expenditure will form an expense against voted funds.

The Committee recommends that the Accounting Officer immediately take the necessary action to settle the outstanding claims by the EU and report to Parliament by 31 October 2002 on the progress made to finalise this matter.

2. Audit Committee

The Committee expressed its concern that an Audit Committee had not been established as at 31 March 2001 and wishes to point out that it constitutes non-compliance with the PFMA and could be grounds for financial misconduct.

The Committee recommends that immediate steps be taken to address this matter and to report to Parliament by 31 October 2002 on progress made with the establishing of the Audit Committee as set out in section 77 of the Public Finance Management Act.

3. Asset management

The Committee took note of the shortcomings reported in the management of assets and that the accuracy and completeness of the asset register could not be determined. The Committee would like to bring to the attention of the Accounting Officer that, since the implementation of the PFMA, the responsibility, should there be any deficits or surplus stock, is that of the Accounting Officer.

The Committee therefore recommends that:

(a) The Accounting Officer adheres to section 38(1)(d) of the PFMA and Treasury Regulations 10.1.

(b) A comprehensive report is submitted to the Auditor-General by 31 October 2002 on the progress made with regard to the safeguarding of all departmental assets and any remaining future important milestones in this regard.

Report to be considered.

Appendix 7:
RESOLUTION
PRESIDENCY

The Standing Committee on Public Accounts, having considered the Report of the
Auditor-General on the financial statements of Vote 1 Presidency for the year ended
31 March 2001 [RP 168/2001] reports as follows:

The Committee studied the Report of the Auditor-General and put questions for clarification to the Accounting Officer of the Department on matters which, according to the Committee, needed attention.

After considering the written replies from the Department, the Committee took note of the steps taken by the Accounting Officer and the staff to fulfil their obligations in terms of the PFMA concerning financial management at the Department. The Committee has resolved not to have a hearing on the report for the year under review, but will await the Auditor-General's Report on the next financial year.

Noting the above, however, the Committee wishes to bring the following to the attention of the Accounting Officer:

1. Audit opinion

The Committee commends the Accounting Officer and staff of the Department for the Auditor-General's unqualified audit opinion on both the financial and compliance audits, and trust that future audit opinions will be equally unqualified.

2. Unauthorised expenditure, R982 000

The Committee took note of the unauthorised expenditure totalling R982 000 during the year and expressed its concern. As the expenditure charged against the Vote exceeded the total amount voted by R982 000, this amount is regarded as unauthorised expenditure in terms of section 1 of the Public Finance Management Act, 1999 (Act No.1 of 1999)(PFMA). The Committee took note of the explanation given by the Accounting Officer as well as the corrective measures implemented by the Department, and recommends that the amount of R982 000 be authorised by Parliament seeing that corrective preventative measures have been taken.

3. Unauthorised expenditure previously reported

Expenditure to the amount of R632 000 (1996/97 financial year) and further amounts totalling R1, 561 million (1999/2000 financial year) was reported as unauthorised expenditure by the Auditor-General. As the Committee is awaiting further information from the Auditor-General regarding these reported amounts, a recommendation will be made at a later stage.

4. Donations

The Committee was informed that an investigation was embarked on to trace all donor expenses incurred from 1998/99 to source documents to ensure that the correct surpluses are surrendered to donors after completion of the projects.

The Committee recommends that the Accounting Officer report to Parliament by 31 October 2002 on the progress of the investigation

Report to be considered.

Appendix 8:
DRAFT RESOLUTION
DEPARTMENT OF PUBLIC SERVICE AND ADMINISTRATION

The Standing Committee on Public Accounts, having considered the Report of the
Auditor-General on the financial statements of Vote 24 - Public Service and
Administration for the year ended 31 March 2001 [RP 15/2001] reports as follows:

The Committee studied the Report of the Auditor-General and put questions for clarification to the Accounting Officer of the Department on matters which, according 10 the Committee, needed attention.

After considering the written replies from the Department, the Committee took note of the steps taken by the Accounting Officer and the staff to fulfil their obligations in terms of the PFMA concerning financial management at the Department. The Committee has resolved not to have a hearing on the report for the year under review, but will await the Auditor-General's Report on the next financial year.

Noting the above, however, the Committee wishes to bring the following to the attention of the Accounting Officer:

1. Audit opinion

The Committee commends the Accounting Officer and staff of the Department for the Auditor-General's unqualified audit opinion on both the financial and compliance audits, and trust that future audit opinions will be equally unqualified.

2. Shares in State Information Technology Agency (SITA)

It is with concern that the Committee took note that the transfer of assets and liabilities in exchange for shares to the state as contemplated in the SITA Act, 1998 (Act No.88 of 1998), had not yet been finalised and no shares had been issued.

The Committee recommends that the Accounting Officer report back to Parliament by 31 October 2002 on the progress made with the transfer of the assets and liabilities.

Audit Committee

The Committee expressed its concern that an Audit Committee had not been established as at 31 March 2001 and wishes to point out that it constitutes non-compliance with the PFMA and could be grounds for financial misconduct.

The Committee recommends that immediate steps be taken to address this matter and to report to Parliament by 31 October 2002 on progress made with the establishing of the Audit Committee as set out in section 77 of the Public Finance Management Act.

Report to be considered.

Appendix 9:
DRAFT RESOLUTION
WATER RESEARCH COMMISSION

The Standing Committee on Public Accounts, having considered the Report of the
Auditor-General on the financial statements of the Water Research Commission for the
period ended 31 March 2001 (as stated in the Annual Report of the Water Research
Commission) reports as follows:

The Committee studied the Report of the Auditor-General and put questions for clarification to the Chief Executive Officer on matters which, according to the Committee, needed attention.

After considering the written replies, the Committee took note of the steps taken by the Chief Executive Officer and the staff to fulfil their obligations in terms of the PFMA concerning financial management at the Water Research Commission. The Committee has resolved not to have a hearing on the report for the year under review, but will await the Auditor-General's Report on the next financial year.

Noting the above, however, the Committee wishes to bring the following to the attention of the Board:

1. Audit opinion

The Committee commends the Board and staff of the Water Research Commission for the Auditor-General's unqualified audit opinion on both the financial and compliance audits, and trust that future audit opinions will be equally unqualified.

2. Evaluation of the financial statements by the Audit Committee

The Committee acknowledges that the Audit Committee has evaluated the financial statements for the year under review. However, the Report by the Audit Committee was not included in the Annual Report of the Water Research Commission as required (Treasury Regulations 3.1.13).

Report to be considered.

Appendix 10:

PARLEMENT VAN DIE REPUBLIEK VAN SUID-AFRIKA
PARLIAMENT OF THE REPUBLIC OF SOUTH AFRICA


05 September 2002

Mr Francois Beukman MP
CHAIRPERSON: SCOPA

Dear Sir

MEDIA ACCESSIBILITY TO MEETINGS OF SCOPA

Please would you place this matter on the agenda of the next meeting of SCOPA for discussion.

I was concerned to discover this week that some members of the Committee regard cluster group meetings and presentations as being "in-Committee" and thus closed to the media.

Consultation with my colleagues indicates that no such decision was ever taken by the Committee and, on the contrary, all meetings of the plenary and clusters are as a matter of course open to the public and the media unless specifically agreed to by SCOPA for good and cogent reasons. This is certainly the practice under both the Constitution and the Rules of Parliament.

I strongly agree and, in the interest of open and transparent governance, request that SCOPA formally agree that all of its deliberations are carried out in public view unless specifically agreed to otherwise by the Committee.

Yours sincerely

MARK LOWE MP
DEMOCRATIC ALLIANCE