Preparatory Workshop on the SAPS Annual Report Hearings with Briefings by Auditor-General, ISS & CJCPP

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12 October 2010
Chairperson: Ms L Chikunga (ANC)
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Meeting Summary

The Committee heard three presentations on the South African Police Services (SAPS) Annual Report. The Auditor General South Africa (AGSA) compared the financial statements for SAPS, the Independent Complaints Directorate (ICD) and the Private Security Regulatory Industry Authority (PSIRA). SAPS had an unqualified report, but this did not mean that all aspects were correct, whilst ICD had an unqualified report, and the position for PSIRA was worrying. All three entities needed to focus on proper record keeping, and producing reliable reports of good quality. Governance must be addressed, particularly at PSIRA. SAPS had not needed to make any adjustments in respect of material misstatements, but ICD had needed to adjust accounts on assets and irregular expenditure, and all PSIRA accounts had to be adjusted by AGSA, and it was recommended that it must issue monthly financial statements. All three entities showed problems in the reliability of reported information. SAPS and ICD had been unable in some instance to provide the required information to AGSA, and some information did not comply with regulations. The specific instances were outlined. SAPS did not have any problems with material non-compliance, but PSIRA and ICD lacked efficient, effective and transparent systems for risk management and internal control, as well as systems for evaluating capital projects. PSIRA had not had an audit committee in the year, and had accumulated surpluses without approval from National Treasury. ICD had not reported irregular expenditure to National Treasury. Supply Chain Management staff at ICD and PSIRA were not adequately trained, and PSIRA did not conduct risk assessment on procurement. Unless leadership at PSIRA improved, its problems would not be addressed. Problems occurred with irregular expenditure in procurement and contract management, with deviations from competitive bidding in SAPS. Irregular expenditure at PSIRA was R3.5 million, whilst ICD reported R14 000 but a further R145 000 was found, and at SAPS this was R1.1 million. AGSA suggested that the Committee should ask SAPS about the progress of the task team, and how SAPS planned to collate information better, as also police commander training in leadership and management. Members asked how SAPS had, despite these irregularities, received an unqualified report, asked if investigations were done into tender awards and computer hardware. They asked what corrective actions AGSA suggested, questioned the use of sampling, and expressed concerns about virements. Members also questioned the meaning of “unknown deposits” “cash on hand” and “departures from the bidding process”, and asked how AGSA dealt with the asset register.

The Institute for Security Studies (ISS) analysed some key performance indicators for SAPS. Visible Policing did not reduce crime, but addressed public confidence. Although numbers of roadblocks increased, numbers of vehicles searched decreased. Priority crime arrests for contact and violent crimes increased, but ISS cautioned that the arrests alone should not be regarded as decisive and it was necessary to track prosecutions. There was confusion around the figures for firearms. Although positive indicators were given for sexual offences arrests, no figures were provided on referrals for prosecution and there was no breakdown of the various crimes in this category. The increase in fraud indicated that SAPS was unable to keep pace with the ever-changing nature of this crime. ISS recommended that effective public complaints mechanisms should be put in place. It noted that although the numbers of disciplinary hearings increased, many cases were withdrawn, and the categories of sanction were not clear. Members agreed that more questions must be asked on these categories, asked how the statistics could be improved, and wondered whether SAPS was spending correctly, since there were considerably fewer convictions than arrests. They also asked how public confidence could be boosted.

The Centre for Justice and Crime Prevention Project highlighted shortcomings in the Annual Report on research, research and crime statistics, performance measures, operational issues and Community Policing Forums. However, the positive quality of the Report was commended. Details were provided of the ways in which the Centre found these aspects to fall short of the desired outcomes, and suggestions were made how they could be improved. Crime analysis should be improved, and crime statistics should be released bi-annually and made available for research. The current performance measures were regarded as flawed. It was recommended that Community Policing Forums should fall under the (currently named) Police Secretariat, and more information was needed on specialised units, and backlogs in the Forensic Laboratories. Members questioned the robotics system, and how the community could become involved.

Meeting report

Chairperson’s opening remarks
The Chairperson stated that the engagements in the next meetings would enable the Committee to prepare fully for its future meetings with South African Police Service (SAPS) on its Annual Report 2009/10. The Committee would today consult with the Auditor-General, Institute for Security Studies (ISS) and Centre for Justice and Crime Prevention Project (CJCPP).Other entities, such as Independent Complaints Directorate (ICD) and Private Security Industry Regulatory Authority (PSIRA) would also brief the Committee.

The Chairperson reminded the Committee that SAPS had earlier presented a four-year strategic plan to the Committee, as well as an annual performance plan setting out what it intended to do in each of those four years. It would now be expected to report whether it had managed to implement the targets.

South African Police Service (SAPS) Annual Report 2009/10: Comment by Auditor-General South Africa (AGSA)
Ms Alice Muller, Corporate Executive, Auditor-General South Africa, stated that the Auditor-General South Africa (AGSA) had done an analysis of the SAPS Annual Report. She said that it would useful to compare SAPS, ICD and PSIRA outcomes. None of these entities had received the ideal, which would have been a financially unqualified report with no adverse findings on predetermined objectives or on compliance with laws and regulations. A five year analysis had been included for the three entities.

Ms Muller said that ICD had moved, in the 2009/10 year, from having a qualified audit report to having an unqualified report, and that a lot of effort had been put into having performance information properly recorded. Ms Muller addressed the issue of drivers to improve audit outcomes, stating that there was a need for oversight responsibility, which involved the proper recording of performance indicators. The tone of engagement at top levels had been generally good. A task team was in the process of being appointed so that it would assist SAPS. She indicated that PSIRA had some challenges around risk management.

She said that both financial and performance management would be covered in the presentation. In respect of financial information, she stressed that there was a need for proper record keeping, for annual financial statements that were reliable and of a good quality, and for adequate systems of reporting. All three entities had to focus on this issue. The key drivers to improve the audit outcomes of governance were risk identification, fraud prevention, internal audit and audit committees. Governance issues in relation to PSIRA required some attention. PSIRA also had some poor reconciliations that had not been done in time in 2009/10, despite the fact that it had addressed other issues that had occurred in the previous year. AGSA was concerned about the sustainability of the outcome, and hoped that PSIRA would improve and not deteriorate.

Ms Muller noted that there were items in the reports relating to material misstatements that were corrected SAPS was one of the few departments that had not needed to make any adjustments. The ICD accounts on assets and irregular expenditure had to be adjusted. AGSA had to adjust all of PSIRA’s accounts, although one positive aspect had been that all the documentation was available, making it easier to fix this problem. She noted that it was important for all departments to maintain stringent financial discipline, on a daily basis, and not simply to address this at the end of the year. AGSA had made recommendations to the Minister that PSIRA issue monthly financial statements.

Ms Muller then addressed the findings on reports of predetermined objectives (targets). Reported information did not meet the required criteria at both ICD and PSIRA. All three entities had problems in regard to the reliability of the reported information. AGSA had not audited the whole of the SAPS Annual Report information, but had, as was usual, used a sample. In future, the intention was to audit the whole of the Annual Report.

Entities were supposed to be able to provide the auditors with sources of information. Providing this had been a challenge for SAPS and the ICD. She noted that some reported information was not compliant with regulatory requirements. SAPS was unable to provide the supporting documentation relating to the number of escapes from police custody, for audit purposes. In addition, the completeness of reported targets could not be verified in respect of Programme 2 of the SAPS that related to visible policing. The validity, accuracy and completeness of the report indicators relating to the percentage of organised-crime related cases referred to court could also not be provided for audit purposes. ICD had been unable to provide sufficient and appropriate audit evidence in relation to the figures reported for investigation of complaints. ICD had used an Excel document which tracked numbers, as opposed to cases. However, it was in the process of addressing the problem. Ms Muller noted that the particulars of PSIRA’s strategic objectives and outcomes for its Registration Subprogramme, as agreed on by the Executive Authority in the Strategic Plan, were not reported in the annual performance report.

Ms Muller then moved on to issues of non compliance. Only at SAPS had there been no material non-compliance problems. Both PSIRA and ICD showed a lack of an efficient, effective and transparent system for risk management and internal control. They also lacked a proper system for properly evaluating all major capital projects prior to making a final decision on those projects. There was no audit committee in operation at PSIRA for the whole year. PSIRA had also accumulated surpluses, without obtaining formal approval from the National Treasury. The accounting officer at ICD had not reported the particulars of irregular expenditure to the National Treasury.

She went on to discuss the findings on procurement and contract management, resulting in irregular expenditure. Most of the problems had occurred at PSIRA. These included the problem that three price quotations were not invited, and reasons for this deviation were not given. A deviation from competitive bidding, which was not justified, had occurred both at PSIRA and SAPS. The Supply Chain Management staff at both ICD and PSIRA were not adequately trained. No risk assessment was conducted on procurement at PSIRA. There were findings that certain irregularities in procurement and contract management had resulted in irregular expenditure. At PSIRA, these included the fact that no prospective supplier list was in existence, unjustified deviations from competitive bidding, and supply chain management staff not being adequately trained.

Ms Muller stressed that she was concerned about the sustainability of PSIRA outcomes, because the basics of risk assessment and fraud prevention were not being implemented. As long as the leadership was not efficient, then the problems faced by PSIR would not be addressed.

Ms Muller then noted that fruitful and wasteful or irregular expenditure of the SAPS amounted to R1,1 million. This appeared to be a very large amount, but was relatively small when compared to the total budget of SAPS. ICD had reported on irregular expenditure of R14 000, but during the audit AGSA had found another R145 000 irregular expenditure. The irregular expenditure at PSIRA was R3,5 million.

Ms M Molebatsi (ANC) noted the Department had received an unqualified report again, despite the fact that there were many shortcomings such as lack of proper record keeping and unreliable information. She asked how it was possible still to obtain an unqualified report in these circumstances.

Mr G Lekgetho (ANC) also asked how it was possible that SAPS was receiving unqualified reports.

Ms Muller responded that the mere fact of an unqualified audit report did not mean that the report was totally “clean”. She stated that the report was unqualified in regard to the financial information, because this was properly reflected, but not on the issue of service delivery.

Mr G Schneemann (ANC) asked whether AGSA investigated to whom tenders were given to. He also asked if AGSA had done any investigation into the acquisition of computer services by SAPS, for a fee of about R1, 4 billion, and the purchase of computer hardware, which had cost SAPS about R150 million. He asked whether “proper expenditure” meant that money was well spent.

Ms Muller responded that AGSA assessed the process – which included looking at whether the necessary specifications were in place, and whether the tender process had gone through the necessary steps. An investigation into who might have been awarded tenders was a matter that was dealt with in a performance report. She noted that she did not have the information on the service fee offhand, but this could be provided. The same applied to the information about the tenders, which would also be provided later to the Committee.

Mr M Swathe (DA) asked why, despite new management at PSIRA, things were still not going well.

Ms Muller responded that ICD did not have a Chief Financial Officer (CFO) and that made its results “fragile”. PSIRA similarly had challenges that were attributable to having no CFO. However, she did point out that financial management was the responsibility of the whole of management, not merely the CFO.

Ms A Van Wyk (ANC) asked whether there were any corrective measures that could be suggested for the SAPS.

Ms van Wyk wanted clarity on the kind of sample that AGSA used to identify and audit tender processes.

Ms Muller responded by saying that there was a big focus on clothing tenders.

Ms van Wyk pointed out that SAPS not having proper reports was not a new issue. She asked how much more time should be given to the SAPS so that it could get its house in order. She went on to raise her concerns about the issue of virements being signed off after October.

Ms Muller suggested that the Committee raise the issue of virements with National Treasury.

Ms M Dube (ANC) asked what was meant by “unknown deposits”.

Mr M George (COPE) asked what method AGSA used to check assets and come to a conclusion. He asked how AGSA checked the issues around three price quotations. He further raised a question on how AGSA assessed the issues with the Department of Public Works.

Ms Muller responded that AGSA reviewed the accuracy of the asset register. She however noted that AGSA did not test the management of assets or vehicles. It only looked at the financial recording of vehicles.

Mr Schneemann asked whether AGSA used other reports when coming to a conclusion.

The Chairperson also asked what informed the sampling process, when AGSA decided to audit some but not all assets.

Ms Muller responded that the AG would do a risk assessment and use a statistical sampling method.

The Chairperson asked what “deviate from the bidding process” meant. She too was concerned about the irregularities being reported upon.

Ms Muller noted that this was not about errors, but a decision had been made to deviate from supply chain management processes. The supply chain management provided for situations where one could deviate from the process, but this should be done only in special circumstances.

The Chairperson and Ms van Wyk asked for an explanation of the difference between “cash on hand” and “cash in bank”.

Ms Muller responded by saying that she was not sure what “cash on hand” meant. She speculated that it could mean petty cash, but pointed out that this question needed to be addressed to the SAPS officials.

Mr George asked when the Committee could expect the samples that AGSA had promised.

The Chairperson requested that the information that AGSA had promised to the Committee should be submitted as soon as possible.

She asked what questions the Committee should be focusing on in relation to the Annual Report.

Ms Muller responded that the Committee could ask about the progress of the task team, and how SAPS planned to collate information better. She also pointed out that the Committee should address the role of the police commanders, and the necessity to train the police commanders on issues such as leadership and management.

The Chairperson thanked AGSA for its valuable input

Institute for Security Studies (ISS) Presentation
Mr Gareth Newham, Programme Head: Crime and Justice Programme, Institute for Security Studies, stated that the SAPS Annual Report was the most comprehensive and thorough source of information about the SAPS and its performance. It thus provided a key source of information for the Committee and the public. The ISS submission was aimed at assisting the Committee to interrogate the Annual Report, and although it was not exhaustive, it did provide some analysis of the key areas of police performance.

He set out these key performance areas. For visible policing, the number of roadblocks, cordon and searches, stop and search, vehicle patrol and people searched had increased. However, the number of vehicles that had been searched had decreased. He stressed that the issue of visible policing did not reduce crime, but it increased public confidence. In relation to groups of priority crimes, most arrests had related to contact crimes or violent crimes such as murder, rape, robbery and assault. Part of this was probably due to the direct contact between the victim and the perpetrator, making it more likely that the victim could identify the suspect and assist the police in making an arrest. In the sub-categories of SAPS arrests, the SAPS had performed better in 2009/10 than in the previous two years, in respect of arrests for violent crimes and arrests for property related crimes. He however cautioned that the issue of arrest should be handled carefully, and that numbers of arrests alone were not a good enough indicator. If a person was arrested, but later not prosecuted, for a serious crime, then this would not discourage the person from committing another serious crime in future. Visible policing spent more time looking for and arresting foreign nationals.

Mr Newham pointed to confusion in the Annual Report caused by three separate figures being provided in relation to firearms that were recovered or received by the SAPS. It would be useful for SAPS to clarify what these figures meant. He noted, for border line policing, that the number of human trafficking related offences had decreased from 87 to 5. There was a slight increase in prosecuting those perpetrating murder, but it was necessary to put more effort into increasing the conviction rate for this offence. There were positive indicators that the numbers of arrests for sexual offences had increased, but reduced numbers of such offences were heard in Court. The reclassification of sexual crimes meant that the figures would reflect not only rape, but also other sexually-related crimes. The Committee should obtain a clearer breakdown of the specific crimes reported to APS and the detectives’ performance on them.

Mr Newham highlighted aggravated robbery conviction rates increased. Residential robbery had been stabilised after double-digit growth figures in the previous years. Commercial crimes had increased, largely due to internet fraud (77.6% increase), fraud using counterfeit credit cards and other cards. This was largely due to the failure of the police to deal with ever-evolving crime. The amounts involved in corruption had increased by 600%, and the trend showed decreasing arrests.

Mr Newham said that it was necessary to have effective public complaints mechanisms in place to ensure public trust. A number of police officer were victims of false complaints. The number of disciplinary hearings had increased, but many cases were withdrawn. He also noted that there a “suspended dismissal” and a “final written warning” category.

Mr Lekgetho asked what was meant by the term “suspended dismissal”. He also asked whether suspending a person without a salary could not be construed as a Constitutional violation.

Mr Newham agreed that suspension without pay was harsh, but was not sure whether this violated the Constitution.

Ms Van Wyk asked what the ideal way of capturing convictions would be, in light of the number of cases referred back by the Department of Justice. The Scorpions figures had related to cases on which it wanted to report, and she was worried about this, in light of the Independent Police Investigative Directorate (IPID) Bill.

Mr Newham responded that the problem was not about resources put to convictions, but the excessive crime. Many of the solutions lay in strategic plans and the internal systems.

Mr Schneemann noted that conviction rates were lower than the number of arrests. He wondered whether SAPS was spending its money correctly. He asked for suggestions how SAPS could increase its conviction rates.

Mr Swathe asked why Mr Newham thought that the sexual offences crimes should not be grouped together.

Mr Newham responded that the category was too large and this made it difficult to analyse. Sex work crimes and rape, for instance, were entirely different matters.

Ms Molebatsi asked whether Mr Newham thought that the numbers of arrests meant that crimes were on the increase, or that SAPS was being more effective.

Mr Newham responded that the numbers of arrests often, but did not always, reflect increased crimes. The Committee needed to follow up what was happening after arrest. This was to do with performance management, not discipline.

Mr George asked for Mr Newham’s suggestions how to increase the public confidence, pointing out that 46% of citizens had little confidence in the police.

Ms Van Wyk asked whether SAPS was keeping statistics properly, and asked how it was currently working with figures, and what it should be doing.

Mr Newham believed that academics should be used to do the research. It was not unusual for countries to use crime statistics as a measure of policing. Some crimes were easier to police than others. The problem was that national statistics were a “blunt tool” and that crime statistics could not measure performance.

The Chairperson stated that she could not understand the difference between final written warning and suspended dismissals. She also stated that the numbers of case withdrawals was worrying.

Mr Newham responded that he did not know what “suspended dismissals” meant. He did not know why so many decisions were taken to start disciplinary hearings, but cases were later withdrawn. This could be an indication of weaknesses in the system. He suggested that SAPS be asked to clarify these issues.

Centre for Justice and Crime Prevention Project (CJCPP) Presentation
Ms Bilkis Omar, Senior Researcher, Centre for Justice and Crime Prevention Project, said that there were some positive aspects in the SAPS Annual Report, but that it also showed challenges related to research, research and crime statistics, performance measures, operational issues and Community Policing Forums (CPFs). The Annual Report had an important role to play in ensuring that SAPS continued contributing towards a safer society. Too often, Annual Reports would be regarded as yet another document, and not given the priority they deserved. The Annual Reports had improved over the years, and were now speaking to quality and not quantity of recruitment, discipline and fitness, and the need for openness and cooperative relationships. She believed SAPS should be commended on the quality of the report. However, there were still some omissions, particularly around the efficiency and effectiveness of the police and policing. If these challenges were addressed, they could go a long way to answering some of the questions.

More specifically, she noted challenges in relation to research, noting that the Annual Report was not making any recommendations but only providing details of reports, although it offered brief crime analysis. She thought that it would be preferable to have a clear assessment, even a critique, of the issues that had been raised. There had been no evidence of ‘internal’ research in the Annual Report.

Ms Omar suggested that crime statistics should be released bi-annually. These statistics should be accessible for research purposes, because SAPS had an ethos of declining and ignoring requests for data. She stressed that providing statistics would benefit the SAPS and those exercising oversight.

Ms Omar highlighted the challenges in performance measures. She highlighted that the current target measures were 7% to 10%. This was flawed, since the police did not determine the crime rate nor have control over crime rates. She pointed out that measures had recently dropped from 7% to 4%. She stated that while the drop could lessen cases of crime statistics being manipulated, and could even remove some degree of pressure from the police, it was an incorrect measure of police performance.

Ms Omar highlighted the challenge that Community Policing Forums (CPFs) were currently located under the ambit of SAPS. They should play a central role in monitoring and supporting police stations. She suggested that the CPFs should be relocated under the Police Secretariat, in order to improve the effectiveness of the CPFs and the monitoring capacity of the Secretariat itself.

Ms Omar then addressed operational challenges, stating that the information that had been provided on specialised units was too brief, especially in light of the challenges that faced those units since being restructured and restructured. She also noted that figures for backlogs of forensic evidence should be provided, especially after the establishment of the new robotics system. 

The Chairperson wanted more clarity on robotic systems.

Ms Omar stated that the robotics were the best system in the world, although nothing had been heard about them since 2007, although this was supposedly a world class system and had been studied in South Africa by the American Federal Bureau of Investigation (FBI).

Mr Lekgetho noted that the audit report did not contain any recommendations. He agreed with Ms Omar that CPFs played a central role.

Ms Van Wyk asked if there were other ways of measuring the success of SAPS. She also asked how the community could be involved in the work of the SAPS.
Ms Omar stated that gaining trust of the community and eradicating corruption in police, as well as enhanced visibility, would increase public confidence.

The Chairperson asked whether there was any scientific evidence to determine whether targets were achievable. She also asked whether or not the Civilian Secretariat for Police Services Bill would sufficiently  guide the work of the CPFs and ensure uniformity.

Mr Swathe asked why Ms Omar felt that the CPFs should be placed under the Civilian Secretariat, not SAPS.

Ms Omar stated that CPFs had a good relationship with the Secretariat.

The Chairperson stated that the main aim of the CPFs was to promote partnerships between the police and the community. She noted that the suggestions presented by Ms Omar would assist the Committee in preparing their responses. She also named her concerns about the backlog in the Forensic Science laboratories.

The meeting was adjourned.


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