Department of Environmental Affairs, SA Weather Service; SA National Biodiversity Institute; iSimangaliso Wetland Park; SA National Parks on their 2014 Strategic Plans

Meeting report

Introductory Comments
The Chairperson explained to the Department that the Committee was expected to hold the Department accountable, in terms of the Constitution, and it would do this in a respectable manner. He hoped the Department reciprocated this respect because the Members were South Africans also who deserved to be respected.  Information would be sought from the Department by the Committee with humility and where the Department did not provide the Committee with the necessary information or assist the Committee in mitigating its concerns, the Committee would act tougher as the Constitution expected the Committee to.

The Committee had until 31 July 2014 to pass the Department’s budget as constitutionally required. Budget debates would begin after 15 July and the National Assembly debate date allocated to DEA was 17 July 2014. After each of the seven DEA programmes had been presented, the Committee would be allowed to interact with the Department.

Mr B Holomisa (UDM) asked that the Department talk to the content of the slides generally instead of reading through each and every one otherwise Members would lose out on question time.

The Chairperson agreed and asked the Department to pay attention to pertinent issues relevant to the Committee passing the Department’s budget.

Overview of DEA Strategic and Annual Performance Plan (2014/15-2018/19)
Ms Nosipho Ngcaba, DEA Director General, noted the apology of the Department’s Chief Operating Officer, Ms Lize McCourt, who was on official duties abroad as well as Ms Judy Beaumont, DEA Deputy Director General: Climate Change and Air Quality and DDG: Oceans and Coasts, Dr Monde Mayekiso.

Ms Ngcaba outlined each departmental programme as per the Estimates of National Expenditure (ENE) beginning with Administration which covered corporate governance and oversight. Next was legal, authorisations and compliance, third was oceans and coastal activities notably including the big budget item of research vessels. Programme four was climate change and air quality management including mitigation, adaptation, monitoring and evaluation. Importantly, the South African Weather Service (SAWS) was covered under this programme. The fifth programme was biodiversity and conservation including heritage matters, SANParks, the South African Biodiversity Institute (SANBI) and iSimangiliso. Programme six included environmental programmes which covered the implementation of expanded public works and international relations while programme seven included chemicals and waste management. 

Programme 1: Administration
Ms Limpho Makotoko, DEA Chief Director: Business Performance, took the Committee through the strategic objectives of the Department in terms of this first programme. 

Ms Esther Makau, DEA Chief Financial Officer (CFO), proceeded to take the Committee through the Medium Term Expenditure Framework (MTEF) estimates for the Department for 2014, 2015 and 2016 as well as expenditure incurred for the current financial year – 2013/14. For the 2013/14 financial year, the Department had a baseline budget of R5.2 billion and this budget progressed to R5.6 billion in 2014/15, R5.9 billion in 2015/16 and R6.5 billion in 2016/17. Most of the budget was reserved for the Department’s Expanded Public Works Programme at R2.2 billion in 2014/15 and R2.5 billion in 2016/17. Expenditure for department agencies was also identified as a large line-item in the budget followed by compensation of employees.

Looking at the Department’s transfers to its public entities, Ms Makau noted there were two types of transfers – financial assistance and infrastructure grants. In total, in 2014/15, the Department transferred R1.1 billion to agencies, R1.3 billion in 2015/16 and R1.4 billion in 2016/17. Specifically, the transfers were made to the Environmental Protection and Infrastructure Programme (EPIP), Working on Fire and Working for Water. Small contractors were also funded for clearing alien invasive species and there was a green fund transfer to the Development Bank of SA (DBSA).  Little transfers were also made to the National Regulator for Compulsory Specifications (NRCS), which was responsible for the regulations on plastic bags, the National Association for Clean Air (NACA), the KZN Conservation Board and the African World Heritage Fund.

In reply to Mr Holomisa asking about the imported plastics from China, Ms Ngcaba said those plastics should meet the standard but she could not answer the question immediately. The Chairperson said the Department should first establish whether there were plastics from China.

Ms Makau moved onto the goods and services analysis per item. The main cost driver for the Department under the fixed and earmarked allocation, was office accommodation with expenditure of R83 million in 2014/15, R89 million in 2015/16 and R77 million in 2016/17. Next was the unitary payment for the Department’s new building which they would be moving into next month with expenditure of R63 million in 2014/15, R66 million in 2015/16 and R67 million in 2016/17. Expenditure was also incurred for international membership fees and communications systems and data lines expenditure of R34 million in 2014/15, R36 million in 2015/16 and R37 million in 2016/17. Expenditure was incurred for external and internal auditors, strategic infrastructure projects, research development for oceans and coasts and on the Department’s laboratories. Looking at research vessels, the SA Agulhus manning and operation cost R45 million in 2014/15, R48 million in 2015/16 and R50 million in 2016/17. Expenditure was also incurred on fuel, groceries, satellites, helicopter services etc for Antarctica and Islands.   

Ms Makau noted that compensation of employees growth was based on a 6.6% cost of living which was adjusted per year. The Department’s goods and services budget was cut annually over the MTEF and as such, the growth for goods and services was only 3% over the MTEF. The Department was watching possible inflationary increases for the vessel operating costs, helicopter services, fuel and supplies for the Antarctica and Islands research, funding changes to the establishment and funding increases in the procurement of all general goods and services. As a result, the 3% growth over the MTEF was very conservative.

Moving on to expenditure for the year that ended 31 March 2014 per programme, the Department was allocated R5.2 billion and it spent 99.9% of this budget with only R6.5 million paid back to Treasury. Currently the Department was finalising its audit and as per the Public Finance Management Act (PFMA), the Auditor-General would release his findings by 31 July 2014. The Department was hoping for a clean audit.

Ms Makau turned her attention to the allocations for public entities and own revenue for the year ended 31 March 2014. For the operation and infrastructure grant, R544 million was allocated by the Department to SANParks, R264 million to SANBI, R182 million to SAWS and R125 million to ISWP.  In total, R1.117 million was allocated from the Department to these entities. These allocations together with revenue raised by the entities themselves showed that the budget for SANParks for the year ended 31 March 2014 was R1.279 million, SANBI, R60 million, SAWS R109 million and ISWP R14 million . The total budget for these entities for the year ended 31 March 2014 was R1.464 million. Looking at where these entities generated their own revenue, these sources were from operating activities/admission fees/aviation income and park revenue, sales, donations, investment income and donations. In total, the revenue generated from these sources were, for the year ended March 31 2014, for SANParks was R2.2 million, R576 million for SANBI, R297 million for SAWS and R150 million for ISWP.

Turning to expenditure for the entities, SANParks had revenue of R2.2 million, spent R2.3 million and therefore had a deficit of R173 million. SANBI had revenue of R531 million, spent R491 million so had a surplus of R39 million. SAWS had revenue of R335 million, spent R295 million and therefore had a surplus of R40 million while ISWP had revenue of R86 million, spent R107 million and incurred a deficit of R20 million. This was all for the year ended 31 March 2014.

Looking at the reasons behind the budget deficits for these entities, SANParks incurred employee costs as a result of an actuarial loss on medical aid prefunding valuation of R155.9 million. To mitigate this, SANParks would be looking at different insurance companies so as not to burden government with the payment of this liability. ISWP had a non-cash loss relating to operating costs.

Ms Makau moved onto expenditure per programme for April and May 2014 with the overall budget being R5.6 million, expenditure of only R741 million which amounted to 13.1% with R4.9 million funds available. This expenditure was a little bit tight as according to projections, the Department should be spending roughly 8% per month. The large percentage programme spenders like biodiversity and conservation and climate change and air quality would need to be monitored closely.    

Dr Linda Makuleni, SAWS: CEO, added that the major challenge currently for her entity was their budget which was cut by R40 million and this affected the implementation of its strategy. 

Discussion
Mr Holomisa noted the Minister had said last year that R8 million would be transferred to the Green Fund to be managed by DBSA. He did not however see a breakdown of the DBSA funds. How were institutions with direct access to the global fund treated? He noted that in underprivileged areas money was not spent on biodiversity problems. He sought more information on the role DBSA played in the Green Fund.   

Mr Alf Wills, Deputy Director General: Environmental Advisory Services, DEA, explained there was R800 million initially allocated to the Green Fund with a further R300 million allocated in the outer years so this was a total of R1.1 billion over the five year period. An evaluation committee short-listed potential projects before it was sent to the management committee. The Department put out a request for proposals against the R800 million and received R10.9 billion worth of applications. Potential projects were sent to the management committee which was chaired by the DG and consisted of Treasury officials, various technical experts from the Department and a senior manager from the DBSA after which an evaluation committee short-listed these potential projects.

The management committee was advised by a governmental advisory panel with representation from all implementing departments like transport, energy, minerals and resources, agriculture and science and technology to provide policy guidelines. Currently the fund funded 28 projects in total, 22 implementing projects and 16 development and research related projects.  A due diligence process was followed were DBSA put together a team of experts from finance, the environment and sector experts before final decision making.

The Global Environmental Facility, under the World Bank (WB), used a methodology of implementing entities such as the WB itself or the UN environment or development programme. Those entities engaged with the project components on the ground. One of the problems was that these entities did not come through in a coordinated manner. For the first time in the world, in a developing country, SA had a national implementing entity which was accredited. The aim was to leverage bilateral investment flows, from Switzerland, Germany etc as the biggest challenge was implementation on an economy wide scale. At the moment, R1.1 billion was enough for demonstration and pilot projects.

Mr Holomisa then asked how much was spent on hiring so-called experts and consultants. Money kept being pumped into DBSA but where were the projects?

Mr T Bonhomme (ANC) asked about a budget decrease on one of the programmes and the reason for this as every other project’s budget increased. Under the goods and services expenditure, he wanted to know why there was no funding allocated to laboratories for 2015/16 and 2016/17. 

Ms Makua replied that a submission was made by the Department to Treasury that laboratories for oceans and coasts were not compliant with occupational health standards. This budget was not a continuing allocation but was termed a non-carry through cost. If the Department needed more funds they would have to make another submission to Treasury.      

Mr M Shelembe (NFP) sought clarification on the R60 million budget allocation for the unitary payment on the new departmental building. 

Ms Makau explained the unitary payment was meant to be paid annually for 25 years for the new building. Treasury contributed R220 million. The building was not being paid for in cash but financed. The Department would reprioritise rental for the current lease together with Treasury’s contribution in order to pay R120 million per annum. If there was a shortfall, the building would be an asset of government in the future.    

Mr A Mngxitma (EFF) was interested in programme three – oceans and coasts. His big concern was around the massive marine resource dispossession and questioned whether the Department was in the right position to monitor this or should there rather be a conversation with other departments, like the navy, from a pure resource and capacity point of view. Perhaps when the details were discussed, a discussion needed to be had on whether the nation actually knew what was going on about the size and scale of marine resources.

Mr Jonas Mphepya, DEA Chief Director: Oceans Conservation, explained that the benefit of the Agulhus was not only for DEA but for a number of other departments like Science and Technology as well as universities and public entities. SAWS, for example, relied on the information coming from the Agulhus. The SA National Space Agency also relied on this information and provided it to the Department of Defence if there was an impending event. Research was also conducted beneath the ocean’s surface as the Department could not manage what they did not know.  

Another Department official added that marine resources also fell under the responsibility of the Department of Agriculture, Forestry and Fisheries, specifically, commercial fisheries.  When it came to marine protected areas, some parts allowed fishing while others were completely conserved. Within these areas, surveys on biodiversity and diving were conducted along with monitoring of certain stocks of fish. There were investigations into unlocking the value of marine resources and bio-discovery. On protected marine species, like sea birds, whales, sharks and dolphins, these were well taken care of by the Department as a source of eco-revenue with an indirect value of half a billion. The research vessels, Agulhus and Algoa, did all the research that could not be done by a small boat for long-term information on climate change, various surveys and research into new and unfolding areas. As far as possible this research was done in a collaborative manner with other organisations with DEA managing the primary platform. 

Ms J Maluleka (ANC) wanted to know about the Department’s 2% disability target and how far they were in achieving this target. She appreciated the Department targeting skills development through internships but asked how the Department relayed the information on internships and learnerships especially to those in the rural areas.

Ms Ngcaba said there was a target of 2% for employees with disabilities and the Department met this target in the last financial year. There were challenges with some branches in the Department not being able to meet this target based on the nature of the work but there was an effort to employ and retain people with disabilities. With learnerships and internships, the Department did advertise in the media but word of mouth did help. Advertisements were placed around October every year and the process was concluded and applicants were informed towards the end of the year or early January. 

Mr T Hadebe (DA) was concerned about SAWS and its budget cut and which services this would affect.

Ms T Stander (DA) questioned performance management and if it was applicable to all Department staff or just senior staff. Since the goods and services budget had been slashed, this would put greater pressure on the efficiency of staff. Although she had noticed that there was a budget for consultants, she wanted to know how far the Department was with its internal capacity and skills development and if there was enough budget attached to this to ensure there was sufficient internal capacity as opposed to hiring outside consultants. She appreciated the emphasis placed on IT as in the green economy paper cost money - although she wished this applied to the Committee itself. She was concerned about the 90 day turnaround time for grievances and misconduct processes and its impact on the budget in terms of man hours spent on these matters and legal costs. Was there anyway this time could be reduced to 60 days and for grievances to be resolved within a fortnight.   

She questioned the effectiveness and cost spent on fighting environmental transgressions. Local government support was crucial for the Department and she was concerned about the cut in budget for municipal dumps. She noticed that SAWS had a surplus and asked how real that impact would be on the delivery of services. On SANParks, she found the medical aid liability very unfortunate and sought more information on how and why that situation arose.  The escalation in cost for the Algoa and Agulhus was incredulous and she questioned the cost versus benefit as the burden of the cost of this research on the Department did not seem fair.

Dr Makuleni explained the surplus for SAWS was a non-cash surplus. The entity had some land which they were meant to develop for SAWS headquarters and for a training college but the development has caused the land to appreciate.  SAWS operation budget had reduced and as a result, the funding now received, only covered staff payments. Funds generated from commercial aviation and other services were used to cover operational costs. This could impact safety of life as SAWS was a 24 hour service institution. It could also affect extensive technology and infrastructure which ensured quality and reliable data. Added to this were challenges related to climate change and climate variability. This had a knock-on effect on aviation safety as they depended on reliable data 24/7. If the quality of service from SAWS to their existing commercial customers was not maintained, these customers would go somewhere else, to a competitor. SAWS also had international obligations to meet certain standards in terms of compliance when providing weather and climate information. Consideration also needed to be given to the safety of SA’s skies.   

Ms Ngcaba  responded to the integrated permitting system, Treasury thought the Department would implement the system once but it was a continual implementation. At times Treasury did provide more costs if this was explained otherwise they told the Department to reprioritise costs from other projects.     

The Chairperson asked if the cost for the appointment of additional rangers and security services, which contributed to SANParks budget deficit, could not have been foreseen. 

The SANParks official explained there was a change in strategy for the security components in the Kruger National Park. This security had always been outsourced by SANParks but due to risks with rhino poaching a decision was taken to in-source this service. This change came with an additional cost in the level of salaries and benefits. On the medical aid issue, which was difficult and complex to explain, historically, people at the perceived “general worker” level never received any benefits. Clinics were provided in each section but last year all workers were brought onto a medical benefit and the impact of this policy – that all employees which joined SANParks prior to 1998 – was entitled to post-retirement medical.    

Ms Ngcaba responded to performance management noting that there were work plans at an Senior Management Service-level outlined in the SMS handbook. There were some challenges with the content of these work plans and standardising the indicators to manage performance. It was also difficult to identify the threshold with certain employment levels, for example, with additional tasks. There was also a balanced scorecard system.

In the Department, some services could not be in-sourced especially those relating to scientific areas. In other areas DEA continued to reduce the reliance on consultants and made use of internal capacity instead. These matters were continually addressed.

The Department did have an electronic document system where submissions were done electronically/on-line. In other areas, government still required paper such as financial records and tabling plans to Parliament. There were different stages of readiness in this electronic drive and the Department was happy to test this with Parliament.

Ms Ngcaba said the Department was trying to improve the grievances turnaround time but at times there were prescribed legislative timeframes such as precautionary suspensions which were 60 days. At other times the process relied on the disciplinary chairperson and other logistical matters but there was always room for improvement.

Ms Makotoko agreed and added the individual needed a minimum number of days to represent themselves.

Mr S Mabilo (ANC) was glad to see some entities performing well but the critical point was that sustainability needed to be emphasised. For those entities experiencing budget deficits, he did not see a plan on how they planned to move from a deficit to a surplus. Overall there was a projection of a reduction of budget over the MTEF. On office space, he asked if the Department was moving toward green buildings. Lastly, what happened to the surplus? Was it reinvested?   

The Chairperson said he was obviously aware of the reduction in budget but wanted to know what plan was in place to mitigate the budget problems. Was there a capacity to get revenue from alternative sources as this was quite a serious dent in the SAWS fiscus.

Dr Makuleni replied that in the last five years, SAWS was required to look at a commercial strategy but they had reached a plateau in aviation. SAWS would be sitting down with Treasury as the goods and services part of the entity was not funded properly.  

Ms Ngcaba added that Treasury’s fiscus right now was tight and the Department, in all likelihood, did not foresee getting anything out of negotiations with Treasury. The DEA itself was restrained in its budget with a decreasing ratio of operations to human resources. The other public entities were also constrained and everyone needed to manage with the budget available but she would keep the Committee informed before anybody was in a danger zone. Also, the methodology for public entities was different from government as the former had accrual systems while the latter used cash-accounting.     

Ms Stander asked if there was any other technology available that did not require the intense, especially human, resources and maintenance to get the same information. She could not understand how the SANParks medical aid issue could have been left until last year.   

Ms Ngcaba added that this issue pre-dated her time as DG and the time in office of many other officials. It was an issue of a shift in policy regarding national and provincial capacity. In provinces, people were not being paid accordingly and people were not attracted to work at a lower level. Issues of affordability had to be phased over a number of years. In SANParks there was not just the issue of medical aid but also that of the level of employment. There was also the issue of homes where employees were provided with accommodation on the parks but then had to be found homes when they retired. The Board was working on how to avoid long-term liability.  

On the DBSA matter, a list of projects could be provided or a detailed presentation could be given at least to show the categories of projects. Some examples of projects were, climate responses to test technologies to transition to low carbon growth in various areas and recycling. 

On laboratories, the matter was valid but the Department still needed to assess budgets for the outer years. An audit was undertaken to assess DEA’s compliance with health and safety in the laboratories and the result was that the Department was not in compliance and some level of investment was needed. A submission was made to Treasury based on this.

Turning to marine/ocean resources, she understood, as a Department, that there was a big gap between the size and scale of resources. In the non-consumptive resources, there was not enough knowledge about resources and an investment was required by government on research for the country on the potential of the oceans for the economy and in protecting the ocean. This investment was justified and in fact government was under-investing in this research. The vessels navigated difficult terrains. Cabinet had decided on environmental sustainability and the responsibility of the Department to patrol certain economic zones. There was technology to supplement this but a fleet was needed in terms of satellites and helicopters but there was no replacement for vessels.    

Programme 2: Legal Authorisations Compliance And Enforcement
Mr Ishaam Abader, DEA DDG: Legal Authorisation and Compliance Inspectorate, explained that in this programme, a large portion of the Department’s money would be spent on subordinate legislation such as the National Environmental Management Air Quality Act regulations and working out fines for the next section 22A. DEA also needed to establish an advisory committee in terms of this Act.

During the course of the year the Department would be dealing with various appeals although it was difficult to say exactly how much money would be spent there. Work would also take place on the National Environmental Management Act (NEMA): Three, NEMA: Waste Bill and the Protected Areas Act all which had recently been assented to by the President. A plethora of regulations would need to be developed for these Bills. The Department awaited the National Assembly to pass the Integrated Coastal Management Bill after it was passed by the mediation committee.

Mr Abader highlighted the importance of the Compliance and Enforcement Strategy for the Environmental Management Inspectorate which was targeted for completion in this year for implementation within the next five years. This was crucial for the work of enforcement as it addressed a number of inspections, the budget available and where resources and capacity could most effectively be used. 

Discussion
Ms Stander asked if the Department was confident the budget allocation allowed it to meet the objectives of the Department as the role of the Committee was to make amendments to the proposed budget if needs be. She noted reports on corruption with Environmental Impact Assessments (EIAs) so what was the Department strategy to deal with these reports effectively?

The Chairperson questioned the number of criminal investigations and dockets finalised in the last financial year. He wanted to get a sense of progression between what was targeted for this financial year and what was actually achieved in the last financial year. How many environmental inspections were carried out last year? With the budget available, would the Department fulfil its targets, deal with legislation and what was the capacity, even on a municipal and provincial level, to carry out enforcement?  

Mr Abader said there was never enough money and if the Committee were to speak on the Department’s behalf, it should be for an increase in the Department’s budget. In terms of capacity and limited resources, the Department had no choice but to make do with what was available. Despite this the Department was being proactive such as in partnering with the Global Environmental Facility for getting money for certain activities like DNA testing. DEA was also looking at alliances with certain foreign donors not only for funding but for certain equipment for anti-poaching activities. Training was now moved in-house instead of being outsourced to cut costs and partnerships were being looked into with international donors like GIZ to limit costs and ensure the Department got bang for their buck.

Ms Ngcaba stated that currently the Department had finalised 24 dockets which had been handed over for prosecution. She had not received formal complaints of corruption in the area of EIAs but the biggest issues in this area were around poor quality reports and delays. Provisions for appeals were good enough grounds to minimise levels of corruption in this aspect.

Mr Abader added that besides appeals, there were opportunities to take reviews to court. On the finalisation of dockets, this was a function of the police but in some instances the Department did have the in-house capacity to finalise dockets which was an added advantage in a sense.

The Chairperson questioned efforts of coordination between the Department and other agencies but he did not see anything on this. How did the Department increase enforcement by working with other agencies or mobilise others to comply with the Department’s goals?

Mr Abader explained there was great interaction with the South African Police Service (SAPS) as the first line of defence. In terms of prosecution, there were dedicated prosecutors to deal with environmental matters as they had been trained in environmental legislation. The Department also trained magistrates and in certain instances, judges, with a magistrates handbook to advice judges and magistrates in environmental legislation/matters. DEA also interacted with and trained the Gauteng Magistrates Association. Interaction was also had with the South African Revenue Service (SARS) and customs officials in assisting with border patrol when the Department did not have the capacity.  

Ms Ngcaba said coordination was institutionalised with security agencies and clusters for engagement and coordination. At a point there was a specialised environmental court in Hermanus, Western Cape, but the Ministry of Justice thought it was better to strengthen regional courts. There was however a prosecutions handbook and bench manual as a form of ongoing coordination.

Programme 3: Oceans & Coasts
Mr Mphepya took the Committee through the targets for this programme for the current year up until 2018/19. These targets related to the legislative framework and development of an implementation plan for the ocean management policy for unlocking the economic potential of the oceans which Cabinet had identified as a key area.

The Department aimed this year to launch a National Coastal Management Programme, to look at beach access and to address shark attacks through a monitoring system. Programmes for the Department’s readiness to deal with oil spills were also targeted for this year.

Mr Mphepya said the Department was looking at undertaking a number of relief voyages to remote stations in the Antarctica and its islands along with surveys into coastal and ocean research projects. Specifically the Department was looking at estimating the population of seabirds around SA and the Southern ocean and to undertake multidisciplinary ocean functioning projects.

Discussion
Mr Bonhomme asked if there were any timeframes attached to these projects targeted or would they all be done in the next five years?

Mr Mngxitma was concerned that certain projects, like the legislative framework, were targeted for 2018/19 when they could not be left for so long.

The Chairperson agreed with the Member as the President stated the importance of the economic potential of the oceans.

Ms Ngcaba explained that this was an area which was not well researched and although the Department could look at beginning an Ocean Act, SA would need to look at zoning the ocean like land was zoned. Just this element of mapping the sea was resource and time intensive and legal provisions came with the capacity for enforcement. The Department would definitely start looking at the legal framework next year but it still needed to implement the Integrated Coastal Management Act after most of its provisions came into effect in 2009. However the mapping of the country’s coastline needed to take place.   

Mr Mphepya added there were other Acts in the country which governed ocean resources, namely, the Marine Living Resources Act which was managed by the Department of Agriculture, Forestry and Fisheries and certain regulations which included marine resources. This was already a framework within which to work. 

Ms Stander noted the little to no real increase in budget for this programme although extensive data was needed to exploit the blue economy.

Ms Ngcaba responded that the challenges of budget were enormous for this sector but the Department still needed to put the building blocks into place to attain the desired state. Hopefully more resources could be drawn from other sources as many stakeholders depended on the data needed to tap into the potential of the oceans. The Department did have other donor partnership agreements like with the Norwegians around some of the research work and the Benguela Current Commission. This being said, the Department still did not have enough resources and it would be sad if SA invested in the oceans without a sustainable legal framework.  

The Chairperson asked if this explained why there were such serious budget reductions in the research component as it could point to a mindset of leaving it for the next generation to deal with.

Ms Ngcaba said unfortunately this was the reflection in trying to persuade Treasury although the Department recognised the allocation in the last MTEF for the research vessels. DEA was looking at charging others, even other government departments, who used the vessels to share the cost of maintenance as it was for the benefit of the country. There were also various global partnerships such as with the French on certain islands and those countries with bases in Antarctica like the British.

The Chairperson emphasised that everyone was intrigued by the ocean economy and its benefits and the sooner information into this was obtained, the better.

Programme 4: Climate Change & Air Quality
The Department official explained this programme was divided into four areas of work organised into three branch purposes. In this programme, compliance with air quality standards was paramount in line with National Development Plan (NDP) and the Department’s own long-term targets.

SA was one of the big players in the climate change space especially moving into the next Conference of the Parties (COP) and the commitment countries would have to make. The Department had developed a framework for the National Climate Change Adaption Strategy for SA. Added to this was the country’s contribution to the global effort to stabilise greenhouse gas concentrations in the atmosphere.

The official explained the Department was involved in a draft national carbon sinks atlas which scientifically identifies which types of vegetation absorbs carbon more than others. The atlas would identify where these vegetation types were and would be considered when spatial planning took place. The Department was also involved in the development of a 2050 pathways calculator to look at emission trajectories. The Desired Emissions Reduction Outcomes (DEROs) gave countries outcomes or thresholds for emissions and looked at a mix of measures to achieve the desired emission reduction outcomes in five economic sectors.

For cleaner and healthier air, the Department had developed the National Air Quality Indicator (NAQI) along with monitoring stations to report on air quality. There was an air quality regulatory framework through which the Department was looking at the development of an emissions offset policy for different industries and guidelines for vehicles into the future. Priority areas had been identified along the Highveld and Vaal Triangle where ambient air quality had been transgressed  

Discussion
The Chairperson asked if the Department was able to adhere to its international obligations and if the budget made it possible. Would reductions in the budget affect adherence to these obligations? He asked if the Department had the requisite expertise especially in this much specialised area heading into this year’s COP?

Mr Holomisa asked how far SA had come with renewable energy programmes. Many people argued that renewable energy was a very expensive route to take while others said coal caused harm. Was there a position going into COP so that SA was not attacked as being one of the worst polluters in the world? He heard about the conference in November in preparation for COP20 but was this not too short a period of preparation for COP20 – why not consider holding the conference in September to get more input from other communities? He knew the problems relating to the Kyoto Protocol in terms of funding but were there any promises that the big countries would be on board this time around? The Department of Energy, DEA and the Department of Trade and Industry (DTI) needed to work closely, especially DTI, for the contestation of intellectual property rights and its possible limitation.

Ms Stander questioned the Department’s compliance with international obligations and commitments in relation to the decrease in budget for this specific programme. Many plans were developed in this programme especially in relation to the next COP but sometimes it helped to put your money where your mouth was.  

The Chairperson was worried that civil society was only involved when there were very big conferences but what was its involvement now, currently, on the important issues which affected them on a day to day basis? It would affect future generations if civil society was not mobilised to be part of these endeavours. What was the strategy to involve the people that were affected the most?

Mr Wills responded that in 2004 the Department had two people working on climate change full-time while another two were working part-time whereas now there were 80. The culmination of this programme currently was as a result of focused government capacity to deal with climate change and air quality. The ability to meet international requirements had been built over this long-term. Currently the Department had reporting obligations with a chief directorate focused on that and it was believed the Department could meet those. There was also a commitment to deviate by 34% from business as usual by 2020 and by 22% by 2025; the jury was still out if this commitment would be met by the deadline. Depending on how it was measured and the matrix used, SA was currently at around 16% so there was an impact and effort made and he urged the Committee to refute, with great vigour, any accusation along those lines as the country was putting in a lot of effort and investment into meeting obligations. An example was the renewable energy programmes and the upshot of the investment and bidding process into these programmes was that SA was regarded as the third or fourth largest renewable energy market in the world. Over 90% of SA’s energy was however extracted from coal and depending on how this was viewed, we were either the 18^th or 17^th largest emitter in the world so we were a significant contributor to the problem.

On the timing of the conference, Mr Wills said in general there was a summit earlier in the year but this particular year, the conference was timed in line with the Fifth Assessment Report of the Intergovernmental Panel on Climate Change Report.

On the Clean Development Mechanism (CDM), developed under the Kyoto Protocol, this was a mechanism whereby developed countries could buy carbon from developing countries. This was developed at a time when developed countries had obligations and developing countries did not; but the system was now where both sets of countries had commitments. The Department of Energy, as the Designated National Authority, had however put a hold on selling CDM credits

Turning to intellectual property rights, Mr Wills said this was an unsolvable issue in international climate change negotiations largely because it was a DTI and World Trade Organisation issue linked to the Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement subject across international body mandates. The challenge was that intellectual property rights could be a barrier to DEA achieving its targets.

On the issue of budgets, a large part of the programmes relating to climate change and air quality were being funded through international cooperation to a large extent with Germany, USA, Australia and the UK. In the longer-term, this would come to an end so increasing the budget going forward would need to be addressed.

Mr Wills responded about civil society involvement, noting that it needed to take place along a number of levels both at a local level as well at a planning level across academia, business and labour as well as involvement in the formulation of SA’s national positions with the same stakeholders but perhaps from a different perspective. From an international position, the Department did have a climate change committee which involved all those stakeholders in the formulation of the positions of the country. Most provinces had already developed climate change response strategies and a process of a multi-sectoral law reform had begun which helped implementation. There were also environmental education programmes and marketing and awareness building to empower citizens to react to climate change.

A department official added that community groups were represented in priority area management forums along with community workshops to share critical areas of air quality management. The Department was planning a fun run in the Vaal Triangle area to raise awareness about burning tyres in winter to keep warm. There were a number of Clean Fires campaigns and once approval from Cabinet was received, the Department would go ahead with road shows to raise awareness about the burning of coal in homes.

Ms Ngcaba added the budget was definitely reflected on the basis that there was supplementary funding from donors although the Department wanted to get more resources in this programme for sustainability in the long-term but the fiscus was not providing these resources. On intellectual property rights, there were engagements with DTI and there was already a framework on bilateral trade agreements discussion at Cabinet level to begin to think strategically about national interests so we were not bound by other national agreements.  

Mr Holomisa asked about enforcement – in the worse scenario, if Sasol and Eskom were to succeed in court, to what extent would this handicap DEA’s enforcement for other polluters in the country?

Ms Ngcaba responded that the if Sasol were to succeed with its court case it would really set the Department back but it was putting in all efforts to ensure Sasol did not succeed including appealing if that was needed. In simple language, Sasol was demanding to be allowed to pollute without giving any commitment on when they would implement a strategy to reduce the level of pollution to at least not exceed the ambient air quality standards or what was called “safe air to breathe” because those citizens around Sasol had the right to clean air. The law allowed for Sasol to apply for postponement but they had applied for exemption and this was definitely an untenable situation, even though the company had been consulted in the drafting of the regulations.

A department official added the Air Pollution Prevention Act was promulgated in 1965 but the democratic government found it unconstitutional. The Air Quality Act came into being in 2004 but the Air Pollution Prevention Act could only be repealed in 2010 with the emission standards for industries. The Sasol court case wanted to put aside these emissions standards and this meant there would be no tool to give an atmospheric emissions licence for any industry. This was consulted for over two years with different industries, including Sasol, community groups, NGO and different players but the Department was putting in all effort to ensure Sasol did not succeed with this case.

Mr Mngxitma thought that one could not speak with confidence about SA meeting its emission international obligations. With civil society engagement, there were those who would not agree with the policy directions the Department had taken and the Committee might be interested in hearing civil society in a broad sense, not just those who agreed with the Department.

Ms Ngcaba agreed with the Member that there were broad views in civil society and from time to time Parliament must have hearings and invite all interested parties – business, civil society and government – to discuss how to meet obligations, not only internationally, but for a national commitment as the President had already called for a transition. 

The Chairperson said the country had a commitment to a clean and green economy and any challenges with this should not be gravitated to future generations. Was there a sense that government was working collectively on this matter or were departments working in different directions? Did the Department need some assistance from the Committee, as politicians, in this area?

Mr Wills said this cut to the heart of the issue. SA did not want to renege on international negotiating positions and responsibilities for the future but given our stage of development and our overriding priority to address poverty, inequality and unemployment, a relative commitment was made which translated to a slowing down as opposed to an absolute halt in emissions. One of the commitments was to replace the old, inefficient coal plants with newer super-critical highly efficient technology, as in Medupi, Kusile and Coal III, if it ever came to fruition. Through such a replacement, the country deviated from business as usual. At the political heart of the matter, the science showed that all countries needed to peak their emissions with the global peak being in the 25-30 range before beginning an absolute reduction to keep global warming to below 2 degrees. SA’s commitments had been carefully calculated with this in mind. The expectation was for developed countries to take ambitious action now and this was a fair contribution although many others would say it was not and SA was reneging but we need to balance development goals with the process of transition from a high-carbon intense economy to a low-carbon intense economy in terms of chapter 5 of the NDP.

The Chairperson asked if the climate change and air quality programme and SAWS would be able to undertake their duties and tasks on behalf of the nation with the current budget.

Ms Ngcaba replied that the programme and SAWS would manage but with real difficulty because revenue was not growing. She did not think SAWS could do without an increase but she could only use the budget adjustments process to persuade Treasury for now.  This difficulty was relayed by the SAWS board to the Minister and right now, it seemed as if the entity might not meet its obligations. There was also no way SAWS could be bailed out from the Department’s own cut budget.

Mr Holomisa thought there was an emerging consensus amongst the Members that the Department’s budget, under the circumstances, was alright with a few exceptions. This issue with SAWS may have to flagged in the Committee Report and for the Committee to use its power of influencing the budgetary processes while the DG took care of things her side.

Dr Makuleni (SAWS) noted that when management received the news of the budget cut, they looked for areas of efficiency. The challenge was that these budget reductions had begun already in 2010 and this affected the efficiency of the work of SAWS. An added challenge was that the budget for maintenance was cut and the current funds were used to cover salaries. Revenue from commercial activities was used for operational costs. She had relayed this information to the Department and Minister. Currently SAWS was reviewing its provision of a 24 hour service in some areas.

Ms Ngcaba explained the negotiations with Treasury were give-and-take although the Department had not exhausted all avenues of engagements. Treasury had been asking departments to reduce the funding to entities to make them self-sustainable but it was a challenging matter.  

Ms Stander asked if the Department was exploring ways to generate revenue across all the entities. She was concerned that the revenue generated by certain programmes from outside and donor funding was not reflected in the budgets presented. Members could not consider the full Department objectives and strategic outcomes if the full picture of funding was not presented. This made it difficult for Members to ascertain which programmes were struggling and which were coping with the resources available. In some line items there was even an apparent budgetary surplus.

The Chairperson said some programmes were being kept afloat by monies received from international corporations and without that revenue the programmes would not be afloat but would be in serious difficulty. It would do no injustice for the Committee to know which outside funding was being injected into programmes or what other revenue was being accrued to look at the full picture as the Committee could do something relative to the Departments budget. The Committee would do everything in their power to assist the Department by engaging with the Standing Committee on Finance as this situation could not just be left at the level of idle talk.

Ms Ngcaba said she would provide the Committee with a donor funding break-down and SAWS will provide the Committee with a document outlining the consequences of the budget cut on SAWS for Members to reflect on as well as where the entity had reprioritised in the past. The Department had engaged all its entities on the issue of revenue although there was a limit to uphold until an entity was operating like any other private organisation. The primary function was on conservation and tourism was secondary.

The Chairperson agreed that everyone would cooperate in tackling this elephant.

Programme 5: Biodiversity And Conservation
Mr Fundisile Mketeni, DEA DDG: Biodiversity and Conservation, took the Committee through the strategic targets of this programme. The challenges in this programme related to rhino poaching, mining in sensitive areas and an inability to harness strategic partnerships.

Mr Mketeni explained the Department was looking at a dossier on a Nelson Mandela Liberation and Reconciliation Memorial for submission to the United Nations Educational, Scientific and Cultural Organisation (UNESCO) as a World Heritage Site in Qunu, Eastern Cape.

A number of conservation and legislative tools were developed to ensure the protection of species and ecosystems such as the Threatened Or Protected Species (TOPS) regulations.

Mr Mketeni spoke specifically to rhino poaching noting that currently 303 rhino were lost this year. Since 2010 there was a continual trend with the poaching of rhino and clearly the Kruger National Park was targeted. On average, 1.7 rhino were killed per day. In 2010 the Department developed a Rhino and Safety Security Strategy which was being reviewed this year to increase rangers on the ground, work closer with the police, increase the ranger range and do a census to know the numbers on the ground. The scourge of rhino poaching was beyond the scope of the Department and large-scale consultation was needed. The Department was in talks with Treasury on a rhino fund. 

Discussion
Ms Stander questioned the funding for iSimangiliso specifically asking if it had an adequate budget to ensure this unique wetland was protected. On SANParks and the SANBI budget allocation, would the extra budget allocation be used solely for infrastructure development or were there other initiatives specifically related to rhino poaching which this budget would cover? She asked for the total specific budget allocation dedicated to combat rhino poaching in SA and what was the total funding accumulated through external and international means? How had the Department found expenditure versus results as there was an increase in the number of rhino poached but there was increased spending as well? She sought the official number of rhino poached up until today.

Mr Andrew Zaloumis, iSimangiliso CEO, said the wetland certainly was one of a kind and there was no other place like it. It was a world heritage site because of its ecosystem, biodiversity and superlative global beauty. In pageant terms, the wetland was Mr or Ms Universe not Mr or Ms South Africa. Budget was never enough when dealing with conservation but it had grown year on year which aligned iSimangiliso, rightly so, with government’s macroeconomic policy. In addition to the allocation from DEA, iSimangiliso had implemented the Expanded Public Works Programme and built roads which then resulted in jobs which were then maintained through outsourcing and this allowed it to be modelled as an emerging model of conservation practice not only in SA but globally and by UNESCO. That said, growth had increased year on year because of tourism numbers and revenue with an 8% own revenue increase in the last financial year despite fiscal, economic challenges. This year, the budget was adequate and sometimes one had to cut the cloth to fit the budget. Staff salary usually made up 7-9% of the total budget which was very low and probably meant the entity was too lean. If the mandate of iSimangilsio increased, budget could become an issue because more foot soldiers would be needed but otherwise there were no current issues with the budget. 

Mr Mketeni explained the Department allocated approximately R80 million last year, once-off to SANParks to improve its security. Otherwise there was a lot of fund raising done by NGOs and the Department requested a registry of all NGOs campaigning for rhino poaching and to be informed of how they were spending the money. The turnout on this was good.

Mr Abe Sibiya, SANParks Acting CEO, added that rhino poaching statistics for the country currently and most recently stood at 496 while Kruger National Park specifically stood at 321.

Ms J Maluleke (ANC) sought clarity on the Department saying jobs “will” be created as opposed to “must” be created. 

Mr Sibiya explained that currently SANParks employed about 12 000 people and were hoping to employ even more taking into account immediate projects. SANParks was also looking at adding two lodges which would add to the staff complement under the expanded public works project.

Mr Bonhomme noted the rhino poaching issue affected everyone and with the Memorandum of Understanding with Cambodia and Mozambique he wanted to know what the outcome was of the two ministerial meetings and when would there be continuation on the matter. How would the deployment take place to curb the attack on rhinos?

Mt Mketeni responded that the general contents of the MOU spoke to issues of reporting especially on consignments and on research around myths and beliefs about rhino horn.

Mr Holomisa felt the rhino saga was actually embarrassing for the country. National intelligence services should have been involved in the matter as the criminals from outside could not operate without internal support.  On the Nelson Mandela Liberation and Reconciliation Memorial, he said that if it was planned properly it could address some of the problems in this area. He remembered one of his early walks with Mandela in one of the villages in Qunu in the early 90s when Mandela asked what had happened to the sound of the birds which used to sing in the early hours when he was growing up. Mr Holomisa replied that because of poverty, people had chopped down the trees and the birds migrated. It would be befitting that DEA play a meaningful role in reviving commercial farming and forests for people to keep their houses warm when global warming hit. It also helped to combat land degradation and encourage communities to commercialise.  He hoped the Department of Arts and Culture was not just paying lip service to this matter. 

Mr Mketeni said the Department believed all actions should be driven in cooperation with Intelligence Services hence the agreement with the South African Security Agency and which would soon be extended to other security groups. A risk assessment for the Kruger National Park had already commenced and the Department would take action from there.

Mr Mapilo noted no mention had been made about cooperation between private game reserve owners and the Department because rhino were not only poached from the Department’s nature reserves but also from private game owners. To what extent was there an exchange of best practice in this regard? Was the Department able to account for the rhino stockpile inventory and how often was monitoring and evaluation taking place to ensure the stockpile was fully accounted for? Around the constraints and challenges raised, he noted the inability to harness partnerships with the Department of Mineral Resources and the Department of Cooperative Governance and Traditional Affairs. He lamented this as working in silos as opposed to an integrated approach. On the wild life economy, he did not hear any discussion on what was happening in the short-term.   

Mr Mketeni noted the Private Rhino Owners Association whom the Department met with last year after which an action plan was developed. SAPS had also ensured they would patrol these farms but because we lived in SA, some of the rhino owners would not allow the rangers to enter their farms due to mistrust. The Department had established a wildlife committee for each province which included land owners at the provincial level. Additionally, each rhino owner was responsible for developing a safety plan for their rhinos.

The Chairperson asked what the benefits would be if SA hosted the Convention on International Trade in Endangered Species (CITES)?

Mr Mketeni said it would attract tourists which would create temporary jobs as seen under the 2010 World Cup. It would also provide the Department with “home advantage” in negotiations.