Presentation on the Research Analysis for the Fourth Quarter expenditure report for the financial year 2010-11

Meeting report

Fourth Quarter 2010/11: Analysis of expenditure report of various departments
Chairperson’s opening remarks
The Chairperson apologised for the delay in starting the meeting, explaining that he had had to make several phone calls to try to locate those who were supposed to present the Analysis Report on the Fourth Quarter expenditure, but had been told they were not aware of the meeting, and one of them would not be able to attend. He said he would discuss the matter of a communications breakdown at a different forum.

The Chairperson noted that the briefing by National Treasury on 26 July had raised a number of challenges. However, since a number of Committee members were not present, it had been decided to postpone discussion until the majority of Members had had a chance to familiarise themselves with the Report. 

He further noted that since the Department of Women, Children and People with Disabilities would be unable to attend this meeting, as scheduled, owing to other commitments, Members could take this time to familiarise themselves with the Analysis, in advance of the next meetings where the various departments reviewed in that report could attend.

Discsussion
Ms L Yengeni (ANC) voiced her concern that the Department of Women, Children and People with Disabilities had informed the Committee at the last minute that it could not attend because of “other commitments.” She questioned whether these commitments were more important than accounting to Parliament.

The Committee Secretary said that there had been attempts to follow up with that Department when it did not confirm its attendance, but there was a communication breakdown, because some of the information on the Government Communications and Information Systems (GCIS) was outdated.

The Chairperson said it was apparent that these administrative issues needed urgent attention, to avoid future disruption to the Committee’s meetings and carrying out of its responsibilities.

Analysis Report: Committee Researchers’ briefing
Mr Musa Zamisa, Committee Researcher, apologised that his research colleague could not attend, but said that he would try to cover all the issues. He also wanted it placed on record that the information contained in the analysis did not vary much from the information presented to the Committee during the National Treasury briefing.

Mr Zamisa said a number of issues required the attention of the Executive, such as the number of vacancies in government departments, unsatisfactory spending on conditional grants, slow spending on capital payments and the persistent culture of rolling-over funds.  National departments had been allocated an adjusted budget of R466,3 billion during the past financial year, and preliminary figures indicated this had been underspent by R10 billion, compared to R5,1 billion in the previous year. 

Mr Zamisa began to give a breakdown of the performance of the 17 departments selected for analysis.

Members interjected to express their concern over several issues relating to the statistics being presented.

The Chairperson said there were a number of inconsistencies, but said that as Mr Zamisa was not the author of the report, he could not be expected to engage with the Committee.

Ms R Mashigo (ANC) said that in some instances, “current payments” referred to employee compensation only, and in others, included goods and services.

Mr M Mbili (ANC) said while it was intended that Members should become more informed by reading the report, in fact the inconsistencies meant that they were becoming more confused.

The Chairperson agreed that the Committee needed to have the correct figures in order to engage properly with the various departments. He asked that the Parliamentary Research Unit must provide the correct figures.

Mr Zamisa conceded that there did seem to be inconsistencies in the presentation, and said he would liaise with the other researcher to eliminate these. He also suggested that there was a problem of lack of consistency in the way that National Treasury compiled its reports. This might be due to the fact that National Treasury often did not receive complete information from departments. 

Ms Mashigo said the Parliamentary Researchers should engage with National Treasury to ensure they had a full understanding of the information, before it was presented to the Committee.  A case in point was the confusion over the way in which “billions” and “millions” were shown in the reports.

The Chairperson said that while the two researchers could work independently, they should each have a full understanding of the full compiled report..

Mr M Swart (DA) pointed out some areas where figures that appeared to relate to capital expenditure were listed under current expenditure, as a result of figures being sequenced inconsistently.

The Chairperson said that the positive result of this review was that the Analysis Report could be corrected and brought in line before the oversight meetings of the portfolio committees. 

Ms Yengeni further commented that most of the analysis appeared to be a simply copied across from the Treasury report.

Mr Zamisa conceded that this had been done, mainly because it had been considered too difficult for the Research Unit to follow up independently on all the issues raised in the Report. A decision was taken to wait until each individual Department was due to appear before the Committee.

Mr Zamisa then summarised the issues raised in the Treasury Report as follows:

Firstly, the overall under-expenditure by national departments remained high, at R10 billion, compared with R5,1 billion the previous year. There was a prevalence, across all departments, of unfilled posts. Most departments showed under-expenditure on goods and services. While most departments had managed to transfer their funds to receiving entities, the Department of Health had not yet made a transfer to LoveLife and the Medical Aid Schemes Council.

The meeting was adjourned.