Women, Children & People with Disabilities; Communications: 3rd quarter spending

Standing Committee on Appropriations

01 May 2012
Chairperson: Mr E Sogoni (ANC)
Share this page:

Meeting Summary

The presentation by the Department of Women, Children and People with Disabilities exposed a serious situation of the overspending of the department’s budget. From the previous 2010/11 financial year, there was overspending of approximately R3.7 million, irregular expenditure of R6.6 million as at the end of the 3rd quarter, there was a projected overspending of R12 million which had been communicated to the National Treasury. The Chairperson reminded the DWCPD that at the end of the 3rd quarter, they had sent a report to National Treasury and the Director General had signed-off this report but according to the 3rd quarter report of the National Treasury, the DWCPD had spent 107% on administration, an over expenditure which was R50 million higher than projected. This was as a result of the DWCPD employing staff at notches higher than those recommended by the Department of Public Service and Administration. This was also caused by the employment of staff outside the recommended framework for employment. The Chairperson said that the department was expected to address the critical issues raised by the reports of the National Treasury and the Auditor General.

Members raised concerns about the continual absence of the Director General which caused delays in the effective oversight of the department by the Committee. The entire department was rebuked for failing to deliver on its core functions. The Department of Women, Children and People with Disabilities was further rebuked for continuing with the trend of over expenditure but failing to stop appointments out of the prescribed salary notches and out of the Human Resources guidelines approved by the Department of Public Service and Administration. The National Treasury was asked to investigate the underlying factors which were causing over expenditure and poor performance and submit a report to the Committee.

The Department of Communications presented expenditure as at 31 March 2012 which showed a general trend of under spending.  The DOC had spent 40.7% on current payments, 48.4% on transfers and subsidies, and 56.9% payment of capital assets. This amounted to a total expenditure of 46.2%. The bulk of the budget went to transfers and subsidies to state owned entities which constituted the core functions of the DOC and where most of the work was involved. On percentage expenditure per programme at 31 March 2012, the DOC spent 76.3% on Administration, 73.2% on International Affairs and Trade, 43.6% on Policy Development, 49% on Enterprise Development, 11.5% on Infrastructure Development and 55.7% on the Presidential National Commission. 

The major concern of the Committee which was emphasized by the Chairperson was the need for a turnaround strategy to bring the expenditure of the department to the desired levels of effectiveness. The Committee said that it was necessary for the Department of Communication to fill its senior management positions. The Chairperson asked the Director General to present the Department’s turnaround strategy to the Committee in writing.

Meeting report

Introductory Remarks by Chairperson
The Chairperson welcomed the delegates from the Department of Women Children and People with Disabilities (DWCPD), the Department of Communications (DOC) and the National Treasury. He also welcomed Members of Parliament from other committees. The follow-up that had to be done after the oversight of the Standing Committee on Appropriations could best be done in collaboration with the other Portfolio Committees and thus the presence of members from others committees was encouraged. The National Treasury was thanked for providing the 3rd quarter analysis. The departments were provided copies of the 3rd quarter analysis to ensure that there was a general understanding of the progress of the discussions. The Chairperson remarked that the Director General of the DWCPD was absent.

The delegation from the DWCPD included Mr M Toni, Acting DG for Women, Children and People with Disabilities; Ms B Mathebise, the Chief Financial Officer of the DWCPD; Mr M Shiviti, Chief Director Human Resources; and Mr L Llewellyn, Director of Finance. The delegation from the DOC included DG of the DOC, Ms Rosey Sekese, Mr S Vilakazi, Acting Deputy Director General: Finance and Enterprise Development; Mr. S Rebolang, Director of Finance; Ms G Mawela, Deputy Director: Budget.

In reply to the Chairperson asking how long Mr Vilakazi had been acting as ADDG, Mr Vilakazi said he had been acting for slightly over two years.

The Chairperson said that the period Mr Vilakazi had served as ADDG was too long and had to come to an end. The DOC had to give reasons for this default.

The Chairperson asked why the DWCPD had more men in its delegation than women. Ms Lamola, a Member of Parliament from the Portfolio Committee on Women, Children and People with Disabilities echoed the same sentiment.

Department of Women, Children and People with Disabilities presentation
The briefing by the DWCPD was mostly an interactive session with members raising concerns as to the irregularities and abnormalities identified within the DWCPD.

Mr M Toni, Acting DG for Women, Children and People with Disabilities gave an apology on behalf of the Director General of the DWCPD who was off sick and unable to attend the meeting.

The Chairperson said that the DG had been absent from many previous meetings and the apology was that she had been off sick.

Mr Toni said that the DWCPD had women making over 80% of the staff component and that the fact that the delegation had more men than women was not a reflection of the staff component of the DWCPD.

The Chairperson insisted on the need to have more women involved with the representation of the DWCPD.

Ms R Mashigo (ANC) asked if the person representing the DG had the relevant accountable status to engage with the Committee on issues which would need follow up. She remarked that the DWCPD was in the habit of not responding to the requests of the Committee and the presence of an ADDG was not sufficient to engage the Committee on the discussions of the day.

The Chairperson agreed with Ms Mashigo and stated that the acting status of any office must be communicated in writing.

The Chairperson raised concerns which he expected the DWCPD to address in their presentation.
The first was that the Committee expected the DWCPD to outline their expenditure as at the end of the 3rd quarter which was 31 December 2011. The responsibility of the Committee was not only to look at the under-spending of departments but also to ensure that the spending was within the allowed benchmark. The Committee had noticed that the DWCPD was over-spending. The Chairperson gave the example that as at the end of December 2011, the DWCPD was at 79% and that meant that by the end of the financial year, the DWCPD might have run out of budget. The Committee wanted the DWCPD to address the issue whether the budget could be managed within the allowed expenditure period.

Secondly, there was the concern of where the DWCPD was spending its money. The DWCPD was not spending its budget on the core functions of the department which were women, children and people with disabilities. The DWCPD was seen to instead be spending its budget on administration and travelling.

Thirdly, the issues raised by the Auditor General (AG) also needed to be addressed in the presentation of the DWCPD. From the previous financial year, 2010/11, there was an overspending of approximately R3.7 million, irregular expenditure of R6.6 million and other issues related to supply chain management. The Chairperson called on the DWCPD to make their presentation in the light of the three concerns.

Mr N Singh (IFP) asked for clarity on the index of content of the DWCPD presentation. Unlike as indicated in the index of content, the first part of the presentation was an overall analysis of the expenditure for the period April 2011 to December 2011. The second part then dealt with the entire year. There was need for coherence in the information which was submitted to the Committee.

Mr Toni thanked the members for the guidance on the issues to be addressed in the presentation and handed over to Ms B Mathebise to do the presentation.

Ms Mathebise started the presentation by clarifying Mr Singh on the index of content. The first part was the expenditure for the 3rd quarter as requested by the Committee but the second part was additional information on the rest of the year for the information of the Committee.

The DWCPD presentation comprised of an overall expenditure analysis for the financial year 2011/2012, the expenditure per programme for economic classification and the preliminary expenditure as at 31 March 2012. The programmes of the DWCPD included Administration, Women Empowerment and Gender Equality (WEGE), Children’s Rights and Responsibilities (CRR) and Rights of People with Disabilities (RPD).

The overall analysis on expenditure from April to December 2011 showed the DWCPD allocated R34,827,000 for compensation; R46,064,000 for goods and services; R55,150,000 for transfer payments and R7,106,000 for capital expenditure. This gave a total amount of R143, 147,000 for allocations. On expenditure, the DWCPD spent R32, 064,000 on compensation; R38, 037,000 on goods and services; R36, 898,000 on transfers payments; and R6, 745,000 on capital expenditure. This gave a total expenditure of R113, 744,000. The total balance at the end of the 3rd quarter was R29, 403,000.

On the compensation of employees, the DWCPD broke down its expenditure per programme. On Administration, the DWCPD had already overspent by R2,067,000; the WEGE had a balance of R1,918,000; on the CRR, there was an overspend of R171,000 and on the RPD there was a balance of R5,592,488. This left a balance of R5, 272,488 under compensation of employees. There was a projected overspending of R12  million which had already been communicated to National Treasury. It was resolved within the DWCPD that there were no longer going to be any appointments beyond the 3rd quarter.

On expenditure on goods and services, the DWCPD had an overspend of R1,555,000 for Administration; WEGE had a balance of R6,490,000; CRR had a balance of R379,000 and RPD had a balance of R2,713,000. This left a balance of R8, 027,000 under expenditure on goods and services.

Ms Mathebise outlined the main cost drivers for the various programmes.
▪ Under Administration, the main cost drivers included advertising, audit fees, communication, computer services, consultant/professional business and advisory services, consultant/professional legal costs, contractors and personnel agencies, stationery, property payments, and travel and subsistence.
▪ Under the WEGE programme, the main cost drivers were advertising, catering activities, contractors, stationery and travel and subsistence.
▪ For the CRR programme, the main cost drivers were advertising, catering, contractors, travel and subsistence and venue facilities.
▪ Under the RPD, the main cost drivers were contractors and travel and subsistence.

At this level of the presentation, the Chairperson said that the presentation did not seem to be addressing the concerns and the request of the Committee. The Chairperson reminded the DWCPD that at the end of the 3rd quarter, it had sent a report to the National Treasury and the Director General signed-off this report but according to the 3rd quarter report of the National Treasury, the DWCPD had spent 107% on Administration, an over expenditure which was R50 million higher than projected. This was as a result of the DWCPD employing staff at notches higher than those recommended by the Department of Public Service and Administration. This was also caused by the employment of staff outside the recommended framework for employment. The Chairperson said he expected the presentation to address the critical issues raised by the reports.

Mr Singh said that the presentation was merely outlining figures and the duty of the Committee was to ask questions as to why the figures were the way they were. He gave an example of the compensation category of the budget which was an area of great concern. He asked if there was a set organogram and an HR plan to which the DWCPD had to adhere and was the HR plan followed. In addition to the overspending, there was the excessive use of consultants, professional business and advisory services. This meant that the whole human resource component of the DWCPD was a lot of money. He therefore wanted the presentation to focus more on the HR plan, the employment framework, the notches and the adherence to these regulations. It was problematic for the department to decide not to do any further employments for the fourth quarter as this was going to create another problem of understaffing which was going to directly affect the levels of production of the department.

Mr M Swart (DA) asked if the HR organogram of the department was approved by the Public Service Commission and what was the guideline if it was approved by the Public Service Commission.

The Chairperson said that the National Treasury report was very clear on the overspending of the DWCPD and that they had conducted employment outside the prescribed guidelines. Why was the DWCPD conducting its operations outside the prescribed guidelines? Another concern was that the DWCPD was under spending on the RPD which was actually the most vital function of the department.

Mr Toni said that when the DWCPD was established as a department, they were hosted by the Presidency and the Presidency was taking the responsibility of HR and administrative matters while the department itself was focusing more on programming. On moving out of the Presidency, the areas which were previously handled by the Presidency were now handed over to the DWCPD. This accounted for some of the irregularities observed.

Ms Mashigo said that when the Committee met with the DWCPD in March 2011 for its 3rd quarter 2010/11 spending, it was no longer under the Presidency. This means that they were ready as a department to be independent but they were still giving the same excuse which they gave three years back.

Ms Lamola asked the ADDG of the DWCPD to remind the members of what was said in the Portfolio Committee on Women, Children and People with Disabilities in the previous week. Ms Lamola said she had asked the Minister why the DWCPD was still giving the excuse of moving from the Presidency three years after the move and was still not up and running. She said the Deputy Minister told the Committee that in the first year, the DWCPD concentrated on policy matters, in the second year, the DWCPD concentrated on HR matters and now in the third year, Information Technology was transferred out of the Presidency to the department. Ms Lamola said that even in a discussion with the Deputy Minister after the meeting, she gave the same explanation. 

The Chairperson said that the difficulty was that the ADDG may not be familiar with the concerns of the members as that was his first appearance. National Treasury had seconded personnel to assist the DWCPD. All that the Committee wanted was for the department to be frank with them and explain the challenges as they were. It was in the interest of the entire nation for the DWCPD to be up and running. The Auditor General had said in his audit report that some of the challenges included effective leadership culture, HR management, policies and procedures, IT and governance, and supply chain management. The Chairperson urged the Committee members to focus on the way forward with the DWCPD. It was clear that there were problems but the DWCPD had to join hands with the Committee to help in moving forward. The over expenditure was continual and needed to be stopped.

Ms Mathebise said that at the beginning of 2011, the structure of the DWCPD was not yet approved by the Department of Public Service and Administration (DPSA). The allocations which were given by the Treasury was based on the previous offices but subsequently, the structure was approved. It was true that the DWCPD had a vote for 2010/11 but at the time, the corporate services support was still within the Presidency so all corporate services were still run by the Presidency. It was in July 2011 that the Presidency handed over corporate services to the department. It was then that the department realized that the allocation from the National Treasury was not sufficient to carry the corporate services function of the department. There was need for general compliance and this increased the expenditure pressures which were not considered in the budget. On the issues of irregular expenditure as observed by the AG, the DWCPD used money on capital expenditure to defray current expenditure.

The Chairperson said that when the AG addressed its audit report to Members of Parliament, another issue raised was that of co-operation from the senior management of DWCPD. The AG was mild in its reporting yet the senior management of the DWCPD was simply not complying to the rules.

Mr M Shiviti, Chief Director Human Resources, said that the HR plan was a concern but it had been resolved and all appointments were now guided by the HR plan after it was submitted on 30 September 2011. One of the issues raised by the AG was the establishment of the audit committee which had now been set up. The internal audit system had been put in place so the governance issue was going to be resolved. Everything was now in place and the department was now complying to the DPSA guidelines and the DWCPD had held several meetings with the DPSA to revise the organizational structure.

Mr Singh said that the DWCPD was not giving specific answers and the response of Mr Shiviti was a usual reply and an escape route from the questions of poor performance and abnormalities.

Ms Mashigo said the problem with the employees ‘outside salary level’ being referred to as people with more experience was that there was no difference between these category of employees and consultants. If there was a difference, DWCPD needed to outline that difference to the Committee.

Mr Signh said that as per the presentation, the overall expenditure of the department would exceed its allocated budget by approximately R22.8 million. It was clear that this excess resulted from the compensation of employees. It was therefore clear it was not only a problem of the employment of people above the prescribed notches but also the employment of people outside the approved organogram. This was also confirmed by the National Treasury report. If the DWCPD had to do these upscale recruitments knowing that they did not have the necessary budget, they should have stopped their appointments earlier and not carry on as though they had an unlimited budget. It was not acceptable for a department to overspend its budget by R22 million. It was not acceptable for government officials to work in such a manner with taxpayers’ money. They had to be responsible and it is clear that responsibility was not displayed.

The Chairperson requested the representative from the National Treasury to give the position of the National Treasury on the situation and what could be done to assist the department. Before the present DG was appointed, the National Treasury had seconded an official to assist with the department but that person was “chucked” out. This meant that the department that was simply refusing to cooperate. He asked National Treasury to explain what it was doing to help the department and what was going to happen with the over expenditure.

Mr George Tembo, National Treasury Director of Public Finance, explained what the National Treasury had done to deal with the over expenditure by the DWCPD. The NT had held meetings with the accounting officer to alert DWCPD to what the NT had observed that the department was going to overspend. An understanding was reached that the DWCPD was going to spend within the budget. As of now, the department was not spending within the budget thus Public Finance and the Office of the Accountant General within the National Treasury were working together to understand the underlying factors behind the expenditure problem. The NT was going to recommend measures that were going to be put in place to help the DWCPD. The engagement with the department had started and the legal services of the NT were also at work as they might be some legal measures that may be proposed.

The Chairperson said that there were not only financial issues but the HR concerns were also very crucial.
The Chairperson sharply rebuked Mr Shiviti for shaking his head in denial of the fact that there were HR concerns. The report was signed-off by the DG and was therefore agreed to by the department. The Chairperson said that if the DG was present, the engagement would have been more meaningful as she was the one who signed-off the report. In that regard, the Public Finance Management Act provided in Chapter 7, Clause 64(3), that executive authority must delegate authority and power in writing.

Ms L Yengeni (ANC) said that of all the departments that the Committee had met with, there had been different challenges but the problems of the DWCPD were very serious and unique. She insisted that the DG should be compelled to appear before the Committee so that the discussions could be more meaningful. She expressed her sympathy for the ill-health of the DG but said that the department had to continue functioning. If the DG was unable to carry out her duties, the department needed someone who could assist her on a full-time basis. Just like the presentation from the DWCPD, everything about the department was disorderly and unacceptable. It may be true that the allocated budget was insufficient but it was over expenditure caused by spending not on the core functions but on administration, compensation and travelling costs.

Ms Yengeni asked the National Treasury to further explain what they meant by “underlying factors” that they were looking for in the department. Did they have an idea of such causes? What were they suspecting besides what they had seen? 

The Chairperson added that besides the employees who were employed outside the approved framework, the DWCPD still continued to engage the services of consultants. This meant that experts were paid to do the work of employees who lacked capacity yet the DWCPD continued to pay these employees.

Mr Tembo said that the National Treasury was going to go into the actual specifics of the appointments which took place, the financial management systems that were used to make these systems and the extent to which decisions were made deliberately or unknowingly to make appointments and expenditures outside the budget. He said the NT was going to check whether it was a question of lack of understanding of the law, or willful deviation from the law. For each of these checks, the NT was sure that there were going to be discoveries. The NT was therefore going to get deeper into the actual arrangements that had put the DWCPD into the expenditure situation it was in.

Ms Yengeni asked that the NT should give a specific deadline. All the work which was promised was definitely meaningless if specific deadlines were not attached. She suggested that before the Committee met with the DWCPD again, National Treasury must have given its report and findings.

Ms Mashigo appealed to the DWCPD and the National Treasury that they should not put the Committee in a position that will leave the Members feeling guilty. The Members were the representatives of the public which needed responses as to the performance of the departments on their core functions. The Committee was assigned by law to appropriate so it was not right for the members to permit actions which did not benefit the public. It was unacceptable the budget of the department was not spent on women, children and people with disabilities but on traveling and compensation. The report of the NT must therefore come in so that the Committee could meet with the DWCPD before the appropriation debate in June.

Mr M Swart (DA) said that expenditure of that nature was considered as wasteful expenditure and must be taken off the budget of the next year. The DWCPD was going to start off with a shortage. This situation was going to continue unless something was done to remedy the situation. There were no results from the side of the Department.

The Chairperson told the DWCPD delegation that the department was not created for the sake of having another department. It was because there was an objective that the government wanted to achieve. It was however sad that the DWCPD was allocating over 60% of its budget to administration. That was unacceptable. There was the serious need for a turnaround. He agreed with Members that the NT must submit their plan of action with a reasonable deadline to the Committee. The Chairperson asked for a last word from the DWCPD delegation.

Mr Toni said that the DWCPD would make sure that the issues raised would be dealt with effectively. He agreed that the department will engage with NT in turning around the department. He rendered an apology on behalf of the department for the lapses and defaults observed and also expressed remorse for any acts of misconduct by any of the delegates during the meeting. He said that the Minister had approved his acting status in writing and the department was going to communicate same to the Committee. He committed to make a follow up on the information requested and promised that the Committee was going to have this information forwarded to them.

The Chairperson said that the Committee wanted the DWCPD to give a detailed plan in collaboration with the NT of a turnaround vision. He said that the turnaround organogram of the department must be informed by the core functions of the department and not administration and compensation. The impact of the DWCPD must be felt by every citizen who is concerned with the functions of the department. He rebuked the department for thinking that they knew what the members wanted to hear and could sweet-talk them into an understanding. There was urgent need for a turnaround. The NT was asked when the Committee could get the report on the work with the DWCPD.

Mr Tembo replied that before the end of the 4th quarter, the report and the turnaround would be ready. This was going to be jointly done by the DWCPD, NT and the DPSA.

The Chairperson extended the well wishes of the Committee to the DG who was sick and asked the delegation from the DWCPD to take their leave.

Department of Communications presentation
The Chairperson welcomed the DG of the DOC who was meeting the Committee for her first time. He noted that the representative from the National Treasury who was in charge of the DOC was absent. The last time that the DOC was recorded to have spent well was in the 2009/10 financial year. The 3rd quarter was the most important quarter because it gave a clear understanding of what to expect as results from the department. As at the end of the 3rd quarter in 2009/10, the DOC spent 62.5% of its budget; in 2010/11, it spent 45% and in 2011/12, it spent 46%. There was a general trend that the department always spent the remainder of its budget during the 4th quarter. It was surprising that the budget which could not be spent over nine months, was suddenly spent over two months. The DOC was thus invited to tell the Committee the challenges it was facing, and what was the DOC going to do to turn things around. He also said that the specifics of the call centres needed to be clarified. The Committee was told that the call centres were once shelved and later brought back. The Committee needed to know what the matter was as there was no spending.  

Ms Rosey Sekese, DOC Director General, said that although there were still certain challenges which the department was facing, the general improvement of the performance of the DOC was going to be the golden thread of the presentation. The reason it had taken a long time for the DOC to confirm the acting status of the DDG was because the DOC started the process of organization review in 2009 and the DOC had had three ministers over this period. This had impacted on some of the internal processes of the DOC. However, the organization structure was approved by the DPSA in July 2011 and the senior management structure was confirmed. The DOC had since then advertised some senior positions such as the Deputy Director General (DDG) for Policy and the DDG for Information Society. The DDG: Policy had already been appointed and the second DDG position was in the process of finalisation. The DDG: Finance and Enterprise Development and the DDG: Administration had also been advertised. These posts were to be filled by the end of June. The position of the Chief Financial Officer was advertised in April and a number of chief director positions were also going to be filled. These structural adjustments were going to play a big role in the stabilisation of the DOC.

The DOC presentation comprised of an outline of the 2011/12 budget versus expenditure; the expenditure as at 31 December 2011, the budget versus the expenditure; transfers and subsidies to state owned enterprises, expenditure and the budget versus expenditure as at 31 March 2012. The DG confirmed that even though the DOC was not able to provide a substantial increase in expenditure as of  31 December 2011, the DOC was however able to show an increased expenditure as of 31 March 2012. In the previous financial year the DOC was at 67% at the end of the 3rd quarter but this year, they were at 89%. This was not a 100% score but there was a substantial increase in the expenditure.

Mr Sam Vilakazi, the ADDG: Finance and Enterprise Development presented the budget and expenditure details. It was of importance to not only focus on the numbers but also on the meaning and signs behind the numbers with relation to the progress and challenges of the DOC.

The DOC had spent 40.7% on current payments, 48.4% on transfers and subsidies, and 56.9% payment of capital assets. This amounted to a total expenditure of 46.2%. The bulk of the budget went to transfers and subsidies to state owned entities which constituted the core functions of the DOC and where most of the work was involved. On percentage expenditure per programme at 31 March 2012, the DOC spent 76.3% on Administration, 73.2% on International Affairs and Trade, 43.6% on Policy Development, 49% on Enterprise Development, 11.5% on Infrastructure Development and 55.7% on the Presidential National Commission. 

The DOC, through its shareholder management monitored the performance of the entity and recommended corrective measures. However, where there were challenges, the challenges were addressed prior to the realizing of funds.

Mr Vilakazi gave a breakdown of the actual transfers and subsidies to SOEs as at the 31 December 2011.

Ms Yengeni asked why there were no actual transfers for the Nepad programme.

Mr Vilakazi explained that Nepad was a small programme in the DOC that focused on specific projects. Every year, there were transfers to Nepad for the specific projects and at the beginning of the year Nepad was engaged in preliminary work which did not require money. The transfers through Nepad were made only towards the end of the financial year. The transfers to Nepad was project driven and was thus going to be transferred in January 2012.

Ms Sekese said that the DOC’s expenditure increased in the 3rd quarter mainly because of the transfers which were released. The 112 project was an area where the DOC was still facing a challenge. The programme was stopped in 2009 and the effecting running of this project was to be initiated by a lengthy process which went all the way to the National Treasury for approval. With the support of the NT, the 112 tender had been released. It was hoped that before the end of the financial year, the DOC was going to come up with a service provider for the 112 project and the project will definitely be rolled out. Ms Sekese promised that in its next appearance before the Committee, the DOC will present detailed feedback on the 112 project.

Ms Mashigo requested that the reason for the DOC not making a transfer to the Nepad project needed to be corrected. The presenter should have rather said that the funds were still to be transferred and not that they were in line with drawings.

The Chairperson said that as per the National Treasury report, the transfer could not be done to Nepad as a result of delays in the submission of the necessary documents. This meant that there were differences in the information given by the DOC and the NT report.

Mr Swart said that it was understandable that some SOEs would prefer to draw fewer funds and were in the habit of drawing only when they were willing to spend this money. It was however a concern that the DOC seemed to transfer all its money to the SOEs. Where was the department then getting the money it was spending on its running? Was it advisable for the Committee to approve the budget given that they were not spending the money on where they were supposed to be spending it?

Mr Singh asked why all the money was suddenly transferred within a space of three months. Was it fiscal dumping to make sure that money simply got out of the department vote to the entities or was it actual proper spending? It was said that there was a forensic investigation on the Universal Service and Access Fund. Were these investigations completed and what were the outcomes of these investigations?

Mr G Snell (ANC) asked how the entities that were receiving funds in the fourth quarter planned to spend these funds. He asked if the Information and Communication Technology policy of the DOC was in place.

Ms Sekese said that the DOC had been alerted of the under expenditure from as early as the first quarter. So the department had engaged with the relevant stakeholders to resolve the problem and to ensure that there was support with regards to the departments’ procurement system. The internal audit committee also met often to check the processes that were holding back the expected expenditure. These internal measures were also aligned with external engagements with the entities to enhance expenditure. It was a long process to pick up and to rectify it.

Mr Vilakazi said that while investigations were being conducted at USAF, funds had to be put on hold pending the outcome of the investigation. The investigation was finalised and there is currently a disciplinary process involved and the projects have now been released. It was only after this process that the funds were released.

The Chairperson said that the core functions of the DOC must always take top priority before the administration dimension of the department.

Mr Vilakazi said that the payment of capital assets was related to expenditure on things like computers. In as much as the DOC tried to monitor the performance of its various programmes and entities, there were isolated incidents with issues such as leadership challenges which needed to always be checked before funds were transferred.

The Chairperson said that the main concern was how to turn around the present situation which the department was in. What was the plan of the department to correct the situation?  It was understandable that there were challenges, but the work still needed to be done. The explanations from the department were not new as the Committee had heard such excuses and explanations before. What was of utmost importance was a plan to move forward.

Mr Snell said that drawings were not supposed to be independent activities but were supposed to be in line with the programmes and strategic plans that the various entities had in place. Why then did these entities plan to spend the bulk of their money and funds in the fourth quarter?

Ms Sekese said that the DOC had a solid plan to improve the performance of the department. This plan was both internal, within the department and external, in collaboration with the SOEs related to the DOC. This planned involved the use of a strategic plan which had been finalised and was in line with the Annual Performance Plan (APP). The DOC has also finalised the project plan. To manage a situation where the goals of an activity had not yet been achieved at the end of the quarter, the DOC would monitor deliverables against the project plans on a monthly basis through the monitoring and evaluation unit. The leadership development plan was a second dimension of the turnaround plan. The stability of senior personnel was a major aspect of the plan. Transforming the culture of the DOC to drive performance was another major aspect of the strategy. The vision was to get the DOC to meet the standards of the private sector. The alignment of the APP with individual performance agreements was another strategy. This was going to breach the gap between the results as shown in the APP and annual report and the individual performance agreement. There was also a plan to improve the governance structures of the DOC. The use of risk management and constant internal audits were part of this plan.

Mr Singh asked if there was a senior official in charge of the monitoring and evaluation of the DOC programmes and the effectiveness of the entities.

Ms Sekese replied that the monitoring was done by a team led by the ADDG: Finance and Enterprise Development, Mr S Vilakazi. This team had to been set up to ensure the effective monitoring and evaluation of the entities.

The Chairperson said that it was necessary for the DOC to fill its senior management positions. He appreciated the fact that the DOC was beginning to address the challenges which were identified. The Chairperson asked the DG to present the turnaround strategy of the DOC to the Committee in writing.

Ms Sekese said that the strategy and the plan was work in progress but was going to be passed through the office of the Minister to be submitted to the Committee. She committed to talk to the Minister to submit the plan to the Committee.

The Chairperson said that a major issue was that of monitoring and the building of capacity within the department.

The meeting was adjourned.

Share this page: