Immovable Asset Register Progress Report by Department of Public Works

NCOP Public Services

04 June 2012
Chairperson: Mr M Sibande (ANC, Mpumalanga)
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Meeting Summary

The Department of Public Works briefed the Committee on the progress of compiling the Immovable Asset Register, noting that the process had commenced in late 2011 and that project management officers had been appointed in January 2012 to oversee the programme. A flow chart was tabled, indicating work in progress, work completed and work not yet started, and it was noted that the work was being done by existing Department of Public Works (DPW) resources, management trainees, and was also incorporating previously unemployed graduates. However, there was also later a note of consultants being used. There were, however, not sufficient business practices, and this hampered progress. 85 000 land parcels had been identified, and these had been broken down for further clean-up of the data, in order to reconcile everything against Deeds Office records. Better collaboration was needed with regions and provinces. The rate of throughput meant that the vesting processes could not yet take place, and lack of information and skills were identified as major challenges. A visual demonstration was given by Ernst & Young of how the final register would look, and what was needed in order to meet the March 2014 deadlines.

Members were critical of the fact that senior management and the Minister were not present, and asked for written apologies to be tabled. Members were critical also of the presentation, with one Member commenting that it appeared that the DPW was defiant of previous requests, and that the current presentation was little better than a repetition of what had been presented in the past, with the same promises being repeated.  Members questioned the efficiency of having office and field-based systems, which surely must result in duplication, asked about the qualifications of the outside parties being used, and how secure the information would be. More clarity was requested on the terms “land parcels” and “properties”, and a provincial breakdown must be given. Members found the presentation far too generalised, and said that specifics of the action taken should have been described. Questions were asked about the Steering Committee, how the DPW thought that it would manage to meet the deadline, and how soon the long leases for nominal amounts would be dealt with, since they posed a severe problem to land reform. Members thought that the DPW could not possibly budget properly without a comprehensive asset register and commented that this probably led to severe financial losses. They questioned where exactly the problems with state land lay, and said that everything presented should have been linked to timelines and projections. They were also critical of lack of synergy between provincial and national offices, commented that the systems in Pretoria were outdated and poor, and said that the structures must be regularised.

Meeting report

Immovable Asset Register (IAR): Progress report by the Department of Public Works
Mr Mfezeko Gwazube, Acting Chief Operations Officer, Department of Public Works, noted that service providers had been appointed and work had commenced on compiling the Immovable Asset Register (IAR) in October or November 2011. Project Management Officers, reporting directly to the Chief Operations Officer and Director General, were appointed in January 2012, to oversee the programmes of clear work packages, aimed at rebuilding a baseline compliant Immovable Asset register.

He tabled a flow chart (see attached presentation) showing the work in progress, work completed and work not yet started, and how the implementation had been structured. The work was being done using existing Department of Public Works (DPW or the Department) resources, management trainees, and was also incorporating previously unemployed graduates.

Work completed to date under the green key, included an analysis, a roadmap, budget plans and a reconciliation of all properties or land parcels. The Deeds Office Weblink Aktek was used as a platform for compiling this information.

Work in progress included liaison work, as well as the analysis of current processes. However, he noted that progress had been hampered by a lack of the necessary business practices to drive it through to completion. This was a cause for serious concern. However, there had been identification of 85 000 properties or land parcels and these were broken down into two sub categories of 50 000 and 35 000 respectively, for purposes of further analysing and cleansing the data. Getting the data completed and reconciled to the Deeds Office records was the main focus, and it was therefore listed amongst the key achievements. The Custodian Framework had been drafted and formed a governing document.

The fieldwork on the Property Management Information Systems (PMIS) of the DPW had shown mixed results. He noted that collaboration was needed with all eleven regions across the nine provinces. The Vesting Process in terms of the concurrent mandate, was not achievable at the moment, because of the current throughput. This matter would be discussed at a Steering Committee meeting scheduled for June 14.

The lack of information and skills at both national and provincial level had been reported as a major challenge to the achievement of a baseline compliant Immovable Asset Register by March 2014.

Mr Gwazube DPW asked the Committee if Mr Mettler, Director: Advisory Services, Ernst & Young, could give a visual demonstration of the Immovable Asset Register (IAR).

The Chairperson asked whether a hard copy was available and noted that in future hard copy documents would be required whenever presentations were given.

Mr Z Mlenzana (COPE, Eastern Cape) thought that there was no purpose in showing anything other than the completed Immovable Asset Register.

Mr Gwazube confirmed that it was a demonstration based on an extract of the final register, and consisted of about 20 lines selected from a portion of the IAR.

The Chairperson agreed to the presentation being shown.

Mr Mettler proceeded to display the extract, pointing out concerns and highlighting the extent of what was required for meeting the March 2014 deadline.

Discussion
Mr H Groenewald (DA, North West) said members had been trying to get information out of the DPW for a very long time. He questioned the efficiency of having the two structures, one in office and other in the field, pointing out that this probably required duplications in software and skills. He also questioned the qualifications of outside parties, and the security measures for information captured on assets. He asked where the team gathering information would report, how the IAR would be structured, where it would be based, and said that more clarity was needed on what comprised land parcels and properties.

Ms M Themba (ANC, Mpumulanga) said this was not the first time that she had asked questions on the breakdown of the 85 000 properties across the provinces. She commented that the presentation was far too generalized, since it merely noted the numbers under “key achievements”, without any indication of the provinces. She said that breakdowns were needed, even on the 35 000 parcels. The presentation also should have set out what action had been taken on matters, rather than merely reporting “progress” or “success”. There were no measurable indicators for the future, and no indication of what action was being taken to achieve targets. She wanted to know how the provinces were represented in the Steering Committee, and how often this Committee met. She said that the Committee was led to the conclusion that the DPW was not serious about reaching the March 2014 deadline.

Ms Themba further noted that no apologies had been tendered for the Minister’s absence.

Mr O De Beer (COPE, Western Cape) questioned how, given the progress over the last five months, the DPW felt that it was on track to complete the IAR by 2014. The previous administration had reported that the system was “in tatters” and there had already been an acknowledgment by this administration that there were severe problems. He noted the “Master Plan” and asked how soon the DPW was expecting to deal with concerns around long leases, especially in the Western Cape, where leases of 99 years at R1 per annum were common, and were hampering land reform. He asked how far the DPW was from actually being able to give a breakdown. He wondered how the DPW could budget without having a comprehensive Asset Register, and said this must surely result in billions being lost in revenue. Mr De Beer requested a record or commitment on present systems and procedures.

Mr M Jacobs (ANC, Free State) stated that at least the DPW had at last come up with something from which it was possible to work. He wanted a hard copy for comparison and verification. He raised the question about state land and wanted to know exactly where the problems lay. He suggested the DPW advertise for information on properties, for the purposes of investigation.

Mr Mlenzana said that even if the DPW were to apologise for the lack of information, it still only gave a brief picture, and this was not sufficient. The IAR programme must be linked a timeline, with projections, as the Committee needed to know when exactly the Asset Register, as prescribed by the law, would be in place.

Mr Mlenzana wanted to know when the responsibilities would be passed back to the DPW from the service provider or consultants.

Mr Mlenzana commented on the lack of synergy between provincial and national offices of the DPW, and suggested that there should be regional offices for better accountability. He said that the vesting processes appeared to be nothing more than theory. He also commented that this presentation was largely a cutting and pasting of the presentation from the previous year, as well as the promises made then. He noted that although he could not say this with certainty, he had the impression that the DPW was acting with defiance of the instructions given by Parliament.

The Chairperson noted that the current administration had now been in place for eighteen years, and wondered where exactly the problems lay. He noted that senior officers felt undermined, and, like Ms Themba, commented that the absence of those who could account was unacceptable. He also wanted more clarity about the 85 000 records and 21 contracts referred to and wondered why there was a need for outsourcing. His major concerns were listed as the Robben Island examples, the lack of proper tallying of figures, the number of long term leases at purely nominal figures, and said that the challenges that still existed with the vesting process were “demoralising”. He wondered how a completed asset register would ever be produced.

The Chairperson, noted that he needed a written apology from the Minister.

Ms Themba commented that a written apology was also needed for the lack of information.

Mr Gwazube noted that point. He then attempted to answer the questions asked, saying that there was difficulty in the DPW in acquiring the necessary and correct mix of qualifications in individuals that could produce the information requested. He felt, however, that he had tried to report honestly on the situation, and had outlined the difficulties as well as the achievements. He noted that the meeting of 13 June would be addressing questions and difficulties around resources, and the deadlines.

He acknowledged the concerns around revenue lost and the implications on land reform, and would pass these on to the heads. He also noted the comments on the perceived defiance of the DPW, and would relay those as well, and ensure that the matter was addressed. He furthermore agreed that the request to move the “critical success” results from a theoretical to practical level was reasonable.

Mr Gwazube stressed that the DPW had a very real problem in lacking the required competencies for the task. The Western Cape was responsible for billions of rands worth of assets, yet was managed by three professionals only, none of whom were engineers, a core technical skill.  

Mr Cox Mokgoro, Acting Chief Financial Officer, DPW, clarified that the auditors had given a disclaimer Audit Report for the 2010 financial year. He acknowledged that the Department’s affairs were in a poor state, and emphasised that it was a massive task to rebuild the Asset Register. There was a definite plan and programme in place, against which the Department would report. He also said that there was a very clear process set out for the systematic transfer of skills in the case where consultants were used, and there were interns engaged by the Department itself.

Mr Mettler clarified that the wording of “land parcels” and “properties” were synonymous.

Mr Mlenzana noted some of the points raised contradicted information that he had on the Eastern Cape.

The Chairperson expressed the urgent need for information on long leases, the need to eradicate poor practices of the past, and to consider what was in the best interests of land reform. There was a need to realign structures in the provinces. He noted that the structure in Pretoria was outdated and inappropriate, and must be corrected. He firmly believes there would be a major cost saving benefits to getting the structures regularised.

The meeting was adjourned.

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