Committee Reports on Auditor-General 2009/10 Annual Report & Auditor-General 2011/12 Strategic Plan and Budget; Auditor-General external auditor & salary package postponed

Standing Committee on Auditor General

11 November 2010
Chairperson: Adv M Masutha (ANC)
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Meeting Summary

The appointment of external auditor for Auditor-General South Africa was postponed. The Committee Report on Auditor-General South Africa 2009/10 Annual Report was adopted. The Committee Report on the Auditor-General 2011/12 Strategic Plan and Budget had a number of inaccuracies so adoption was postponed. The Report on the Salary Package of the Auditor-General was postponed as a third proposal had to be discussed with Alexander Forbes and the Remuneration Committee in attendance.

Meeting report

Appointment of external auditor for Auditor-General South Africa postponed
An independent Audit Committee member from the Office of the Auditor-General presented reasons for not appointing an external auditor at this stage. Certain criteria had to be met in order to be appointed as an external auditor. The Audit Committee promised the Committee that it would appoint the right candidate as soon as those criteria were met.

Committee Report on Auditor-General 2009/10 Annual Report
The Committee was asked by the Chairperson to comment on the report as it was being read out by the Committee Secretary.  Some minor technical amendments were made to it.

Mr M Steele (DA) moved for the adoption of the report and Mr L Ndabandaba (ANC) seconded the adoption of the report.

Committee Report on Auditor-General 2011/12 Strategic Plan and Budget
The Committee made extensive amendments to this Report so it was not adopted at the meeting.
Committee Report on salary package of Auditor-General of South Africa
The Chairperson said that the report was the product of an exercise that involved three meetings between the Remuneration Committee (Remco) and a committee task team which went through the proposals of Remco. After considering the legal opinion from Parliament’s Legal Office, the Committee recommended the restructuring of the Auditor-General’s salary package regardless of what was the initial agreement discussed with the Auditor-General. Two recommendations were made: (1) to increase the salary and make the salary adjustment as recommended by Alexander Forbes and (2) the adjustment of that recommendation which sought to add an amount for cost of accommodation equivalent to that afforded the Chief Justice in monetary value which the task team rejected on the basis that that such an element would constitute a tool of trade and therefore could not be regarded as a benefit for purposes of reconstructing one’s salary package to the equivalent of that of the Chief Justice. It seemed that the figure provided following the readjusted submission from Remco increased from R2.2 million initially to R3.4 million and then went up to R4 million with accommodation included and now reduced to R3.8 million.

The Committee Secretary read a letter containing a revised submission from Alexander Forbes.

The Chairperson asked the Committee Secretary when the letter was received as the letter had not yet been circulated to the Members. The decision was that the original proposal be re-submitted or that proposal three contained in the letter, be considered. The task team had not seen proposal three. However, neither Remco nor Alexander Forbes was present at the meeting to motivate for proposal three and this complicated matters. Also, not all the Committee Members were present at the meeting. He asked for guidance from the Members present.

Mr L Ndabandaba (ANC) said that the Committee should rather convene next week to consider the report.

Ms D Nxumalo (ANC) said that the Committee should meet next Tuesday 16 November and call in the Remco and Alexander Forbes.

Mr M Steele (DA) said that the letter of motivation from Alexander Forbes should be circulated to all Members first and then the Committee could meet on Tuesday to discuss the report and the letter.

The Chairperson wanted to take it further than that. A third proposal was on the table. He recommended that the task team not be resuscitated. The task team had done its work on the first two proposals and its work had ended. He suggested that the letter rather be presented to the full committee. He thanked the Members for their respective comments and input.

The meeting was adjourned.


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