Analysis of DSD Strategic Plan& Budget for Social Crime Prevention & Victim Empowerment Programme: briefing by Shukumisa Campaign; NDA on its 2013/14 Annual Report

Social Development

17 October 2014
Chairperson: Ms N Capa (ANC)
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Meeting Summary

The Portfolio Committee received presentations from the Shukumisa Campaign on analysis of the Department of Social Development Strategic Plans and Budgets of the sub-programme Social Crime Prevention and Victim Empowerment Programme for the period 2009/10 to 2013/14 and the National Development Agency on its 2013/14 Annual Report.

The Shukumisa Campaign grew out of the Nation Working Group on Sexual Offences in 2004 and comprised a national coalition of 45 civil society organisations with members in all 9 provinces. Its function was to train and support organisations in the monitoring and implementation of sexual offences law and policy, partner in developing policy and research and advocacy.

There was a great emphasis on the paucity of Non-Profit Organisation (NPO) funding by government as both presenters and members raised concerns about the issue. To this end duplication of services was raised as a potential difficulty and it was submitted that funds could be better utilised or distributed in line with extending reach. On the issues of Social Crime Prevention and Victim Empowerment Programme, Shukumisa was of the view that the Department had reprioritised its objectives thereby relegating or subsuming these issues under other, less appropriate objectives. Funding for these areas was precarious or concentrated in private sector service providers. Other funding related issues were flagged in the briefing and recommendations given. Despite poor attendance by members, those present made it a priority to hear and advance the recommendations presented by Shukumisa, after imploring the organisation and similar groups to address development and women’s services inconsistency between urban and rural areas.

During the discussion which followed the presentation, the Chairperson decried the continuous disparities between the urban and rural areas in terms of resources and development measures. She then clarified the purpose behind the reduction of priorities highlighted in the Shukumisa presentation was due to a refocusing of efforts on elementary objectives, to be later built on by further priorities. This was in line with improving fiscal efficiency so as to achieve all priorities. She further elucidated reasoning in subsuming certain objectives such as social crime, gender violence under broader priorities such as family protection for instance, as the achievement of the latter would entail the achievement of the former. The Chairperson made a commitment to further engage with the presenters where the committee would lay out its plans and the presenters would then be better able to provide relevant constructive feedback. Initiatives such as Imikondzo directed at reaching communities and other social outreach vehicles where testament to the commitment to social development by means of community upliftment and self-actualisation as opposed to passive welfare. Where the issue of duplication was raised, the chairperson posited that a centralised approach would not suffice due to contextual differences in different areas such as language and culture. The presentation was not open for debate as further engagement was necessary by all members. Instead further correspondence was encouraged with an upcoming Indaba with social workers hosted by the Minister in the near future cited as an example.

The National Development Agency (NDA) then tabled its 2013/14 Annual Report. Given the mandate and mission of the organisation, the NDAs strategic focus areas were allocated targets and performance indicators, some of which were deferred. The programme of performance showed the organisation surpassed its achievement target. In addition to an unqualified audit, the NDA presented their audited financial statements. The main challenge remained funding allocated to the NDA by Treasury given its vast mandate.  

The Committee was concerned as to the poor board member meeting attendance over the year under review. Clarity was sought in terms of differing sets of financials that both pertained to the financial performance. Committee Members asked why there was a rather large expenditure on consultancy services. The consulting fees had actually declined from R6 million in the previous year whereas in the year under review R2.5 million was spent. Travel costs were also high. Did any of these costs include international travel?

Meeting report

Briefing by Shukumisa Campaign

Ms Lisa Vetten, an Independent Expert and Member of the Wits Institute of Social and Economic Research and Shukumisa gave background information on the Shukumisa Campaign. The Campaign grew out of the Nation Working Group on Sexual Offences in 2004 and comprised a national coalition of 45 civil society organisations with members in all 9 provinces. Its function was to train and support organisations in the monitoring and implementation of sexual offences law and policy, partner in developing policy and research and advocacy.

In terms of the Department’s 2010-2015 strategic plans, the campaign had found that two out of six priorities were relevant to sexual violence. And the 2012-2015 strategic plans saw priorities reduced from six to four areas. Approximately 0.4% of the national department’s budget was allocated towards welfare services which were distributed amongst 11 sub-programmes which included the social crime prevention and victim empowerment programme (VEP). Social crime prevention and victim empowerment grew from 3.9% to 9.2% of welfare services’ budget from the 2009/10 to 2014/15 periods. Between the 2013/14 and 2014/15 financial years, the Department’s expenditure on social crime prevention and victim empowerment increased by 86%. The significant increase in funds was directed at giving effect to the responsibilities borne by the department by virtue of the Child Justice Act of 2008. On 30 August 2011 the Department stated that government was not providing adequate financial support to the VEP. The European Union issued a grant for 18 million Euros for VEP which was relied on with an application was made to treasury for additional funding which resulted in an additional R8.4 million allocated to the programme in 2012/13. These funds went to a National Gender Based Violence command centre introduced in 2013/14 which was managed by Advance Call. There was a substantial increase in the use of consultants with expenditure multiplied from R1.1 million to R13.9 million between 2013/2014. Funds allocated to consultants were 5% greater than VEP staff costs (22%).

Ms Vetten told the Committee that it was a concern that there may be a duplication of existing services. The National ‘Stop Gender Violence Helpline’ managed by Lifeline was such an example. It was also funded by the national and Gauteng departments of social development costing R 1.2 million per year. It was run by a staff of 23 where the command centre’s staff compliment was 75. There was some discrepancy regarding the composition of the staff as the Minister had announced the 65 of the 75 would be retired social workers whereas the Annual Report 2013/14 details 60 social work graduates. The Helpline services about 13 000 callers annually whereas the Command centre anticipates 2400 callers annually. The command centre was only available in Gauteng and KwaZulu Natal, areas which were already serviced by women’s organisations. Other potential duplication was in the form of the Inter Ministerial Committee on Gender based Violence coexisting with the Nation Council on Gender based Violence under the Ministry of Women but was on hold. Further, the 2013 Department of Women Children and Persons with Disabilities gender based violence campaigns as well as the development and implementation of its five year national strategic plan.

Other observations, according to the 1997 White Paper for Social Welfare, were that social welfare programmes were not considered to be critical social investment priorities and were under resourced. Thus, salaries were low and working and service conditions were poor for welfare personnel. In 2014 the DSD subsidised only 75% of NPO salaries while paying private sector service providers in full. Other concerns included inconsistencies across provinces such as the quantum paid, the calculation of payments and what was funded. It was also posited that the EPWP was not an appropriate programme to support rape services as was the experience in Mpumalanga.

Shukumisa thus recommended that the Department of Social Development (DSD) should not duplicate existing NPO programmes and services. Ms Vetten submitted that the funding policy to NPOs be reconsidered and that funding should reflect value of work as well as being better standardised. The relationship between services and funding should be such that services determined the funding, where the measure of a good service was its preventative nature. Greater emphasis was needed on women’s care work and women and children’s trauma as these were lowly valued. Finally, public hearings should be held around an appropriate approach to funding services including rape services.

Discussion

The Chairperson decried the continuous disparities between the urban and rural areas in terms of resources and development measures. She then clarified the purpose behind the reduction of priorities highlighted in the Shukumisa presentation was due to a refocusing of efforts on elementary objectives, to be later built on by further priorities. This was in line with improving fiscal efficiency so as to achieve all priorities. She further elucidated reasoning in subsuming certain objectives such as social crime, gender violence under broader priorities such as family protection for instance, as the achievement of the latter would entail the achievement of the former. The Chairperson made a commitment to further engage with the presenters where the committee would lay out its plans and the presenters would then be better able to provide relevant constructive feedback. Initiatives such as Imikondzo directed at reaching communities and other social outreach vehicles where testament to the commitment to social development by means of community upliftment and self-actualisation as opposed to passive welfare. Where the issue of duplication was raised, the chairperson posited that a centralised approach would not suffice due to contextual differences in different areas such as language and culture. The presentation was not open for debate as further engagement was necessary by all members. Instead further correspondence was encouraged with an upcoming Indaba with social workers hosted by the Minister in the near future cited as an example.

Ms L Van der Merwe (IFP) thanked Ms Vetten for the presentation and expressed concern at the issue of NGO funding. Such organisations were expected to provide statutory services on behalf of the state but were not being adequately funded. South Africa had a very high rate of sexual offences and thus a cohesive funding model needed to be investigated in order to assist organisations that supply vital support services. The recommendation of public hearings was thus welcomed in this regard.

Ms K De Kock (DA) thought the presentation was of value in terms of the information provided. The recommendations would be taken forward.

Ms H Malgas (ANC) stated that the Department was to have a Bill on professional services and victim empowerment and as such public hearings were to be expected. She raised the difficulty of an integrated approach where other departments did not perform thereby compromising the work of Social Development. That was an issue which required the committee’s consideration. Another important issue was the public hearings which would enable communities to speak on issues relevant to them.

The Chairperson added that it was often the situation that public hearings excluded the marginalised, who had no resources and who were not organised. Thus, it was imperative that public hearings be held where such people were located. Where there were inconsistencies in payments between NGOs, the Department had brought this under review. Effectively, all the concerns raised in the presentation had been dealt with and a perusal of the committee minutes would verify that.

Ms Vetten accepted that South Africa had many needs and priorities. It was undesirable to have vulnerable and disadvantaged groups competing against each other; instead what was desired was a structured model for funding which would provide clarity and certainty amongst service providers. The concern regarding duplication was the monetary implications of setting up services where they already existed. It was suggested rather that the money be redistributed to provide services in areas where none existed. This was important as the services rendered were statutory services. A final issue that needed to be brought to light was that many organisations relied on volunteers as they could not afford social workers. The concern was that more often than not these were women who were significantly underpaid with no job or salary security. The question then became how to get the funding and working conditions of such women to be improved.

Ms Nombulelo Mabombo, National Director Lifeline South Africa, noted the issue of duplication of services and the potential funds that could be released if this was avoided.

National Development Agency (NDA) 2013/14 Annual Report

Dr Vuyelwa Nhlapho, NDA Chief Executive Officer (ex officio) outlined the role and mandate of the NDA according to the NDA Act 108 of 1998. The mandate was to contribute towards the eradication of poverty and its causes by granting funds to civil society organisations. The vision, mission and values informed the mandate of the organisation. The structure of the organisation showed a staff compliment of 178 of which 72% was female.

Strategic Focus Areas

The NDA had achieved the level of 2.6% which was above the public service target of 2% in terms of employees with disabilities. The NDA focused on four strategic areas. These were early childhood development, food security, income generation and capacity building. The strategic goals and objectives thus arose out of these focus areas. The strategic goal was to leverage strategic partnerships to eradicate poverty to enable poor communities to achieve sustainable livelihoods. The objectives were then to carry out programmes or projects aimed at meeting the development needs of poor communities; to undertake research and publications aimed at providing the basis for development policy; to strengthen the institutional capacity of civil society organisations and to promote and maintain organisational excellence and sustainability.

Strategic Priorities

The Board of the organisation had further identified priorities which could complement the NDA’s service delivery parallel to the implementation of the NDA APP. These were the implementation of Early Childhood Development (ECD) campaign; expansion of the capacity building programme; implementation of NDA Programme Management Unit (PMU) which was to serve as a financing vehicle given the limited funding from Treasury. Further Board priorities included Conversion of NDA provincial offices into advisory centres and to increase NDA brand visibility. In terms of the implementation of ECD campaign during the year under review, the NDA with the leadership of the Minister of Social Development and the Board launched the Adopt an ECD Campaign which was aimed at the NDA leveraging its limited capacity through partnerships with different stakeholders to contribute to implementation of an ECD programme nationally. Through these partnerships an amount R560 000 was solicited from private donors. The Annual SA ECD Awards will be hosted by the NDA for the first time in March 2015. The capacity building programme DSD pilot project was funded by five provinces – North West, Northern Cape Eastern Cape, Limpopo and KwaZulu Natal. Expectations were exceeded with 2059 CSOs and NPOs being capacitated in Governance, Financial management, project management, Resource mobilisation and conflict management. 4384 members of CSOs and NPOs staff as opposed to the targeted 1174 attended the capacity building interventions. 236 ECD practitioners enrolled in a NQF level 4 ECD training programme.  There was an 80% improvement in knowledge and practice areas they were capacitated on thus far. As to the priority regarding NDA Advisory centres, 28 centres which served as repository for information to stakeholders on NDA, SASSA and DSD were established. A challenge in previous years, NDA visibility and brand were bolstered by publicity to the value of R3.1 million through various electronic and print media platforms for NDA funded projects and the Adopt-an-ECD campaign. In addition, partnerships were fostered with media houses such as the New Age, SABC 2, ANN7, Vuka Afrika and Top Women in Business and Government. Improved visibility was enabled by use of social media platforms.

Performance

In terms of NDA performance, the organisation was audited on 31 targets as opposed to the 34 tabled in the Annual Performance Plan. An amendment to request deferment of three targets to 2014/15 was approved by the Minister of Social Development. Two of the deferred performance indicators were the completion of development of an integrated ICT system. The third related to the ratio of Mandate to Administration from 57:43 to 55:45. In all, 29 of the 31 targets were achieved during the year under review. The actual achievement exceeded the target of 80% by 13%. The first programme’s targets, aimed at meeting the development needs of poor communities, were all achieved save one of allocating R20 million to food securities programmes with a shortfall of R 4.3million. All the targets under research and development were met as were those allocated under capacity building. The programme on governance and administration saw good results but was also the source of the second unattained target in the form of the percentage of positive rating on NDA brand awareness achieved.

Financial Performance

Mr Phumlani Zwane, NDA Chief Financial Officer stated that the NDA had improved in their revenues in as far as third party funds mobilisation is concerned. There was in fact an increase of 142% which was testament to the work done by the PMU. However, in terms of baseline allocations the organisation was still lagging. Only a 3% increase in allocations was secured which was insufficient in light of the costed mandate. The total expenditure reflected a 10.9% year on year increase driven mainly by the increase in mandate expenses. Effectively, this meant that the business was run more efficiently in that the administrative costs had decreased and the increased expenditure was due to mandate costs. That was to be viewed in light of the fact that Treasury had allocated a 3% increase in funding. The mandate costs emanated from commitments to projects with 82 projects worth R78.9 million approved in the 2013 financial year with R72.9 million in total allocated to commitments. In terms of administration costs, during the period under review 36% of the total cost was spend on administration which was a great improvement following the previous year’s results. A significant accounting change necessitated by the Auditor General was that project expenses would only be recognised once the project was paid. Therefore the result was that the statements were a hybrid of cash and accrual accounting. As to the composition of the cash reserves, unencumbered cash is recorded as zero meaning as at year end the total cash balance comprised money that did not belong to the NDA but rather to third parties as committed funds. It was also explained that the NDA did not have debtors per se but rather receivables comprising rental deposits for leased offices and other receivables and employee advances. Mr Zwane went on to explain the cash flow statement as depicting the organisation’s position at the beginning of the financial year and their end position of R126 million, incurring outflows of over R30 million.

Dr Nhlapho then concluded by conveying to the committee that in terms of funding, the allocations made to the NDA was a drop in the ocean. The NDA was then unable to realise its mandate given the limiting resources.

Discussion

Ms Van Der Merwe commended the NDA for exceeding the disability target, the reduction in administration expenditure and achieving their targets. Clarity was sought in terms of differing sets of financials that both pertained to the financial performance.

Mr Zwane replied that the different statements were actually the same but differed due to the one set comparing activity based budgeting to different activities. The net outcome was R19.4 million on both. The only difference was a capital expenditure of R1.83 million which caused it to appear different.

Ms Van Der Merwe asked how much of the R3.1 million spent on media was allocated to the New Age and ANN7 as she had had experience of New Age advertising costs and they were relatively expensive. Why had NDA chosen these media platforms over the SABC or GCIS given the financial strains?

Dr Nhlapho explained that the media related expenses were minimised by partnerships resulting in free publicity, one such example was with ANN7. New Age was utilised during the ECD campaign and launch and about R900 000 was paid for that programme.

Ms Van Der Merwe was concerned as to the poor board member meeting attendance over the year under review. Further, Mr Naicker was listed as being paid as a board member but had not been appointed as such, what were the reasons for this. Board members received varying amounts per meeting, how was their remuneration calculated.  The largest expenses under miscellaneous expenses were banking costs. Which bank(s) did the NDA use and were there no cost effective alternatives.

Mr Kekana responded to the issues pertaining to the board. The board was assembled in 2010. The sitting board had thus completed their term and processes were underway to renew or replace board member tenures. The overriding reason for inconsistent board meeting attendance was the unforeseen change in circumstances for many of the board members which were reasonable and therefore tolerated. It was then suggested that convening meetings by telephonic means would be more convenient and cost effective. The Board fees were less than most entities as there had been a significant reduction in that regard. Mr Naicker was appointed as a special member of the audit committee as the board had no qualified chartered accountant and the chairperson of the board thought it necessary to appoint one.

Mr Zwane stated that the high bank fees were due to having 20 accounts across the four major banks. These accounts were for third party monies including investment accounts for the committed funds, which were required to be placed in interest bearing accounts. However when compared with the bank interest income of over R5million, the expense paid itself off.

Ms Van Der Merwe inquired as to the Auditor General’s findings, whether the NDA would be holding officials accountable for supply chain management short comings.

Some of the noncompliant officials had already been charged and the organisation was recovering monies from liable officials. Therefore the organisation was taking action in line with the Auditor General’s recommendations.

Ms L Van Der Merwe asked why there was a rather large expenditure on consultancy services. The consulting fees had actually declined from R6 million in the previous year whereas in the year under review R2.5 million was spent. Travel costs were also high. Did any of these costs include international travel?

Dr Nhlapho clarified that the travel expenses were local destinations and only one entry was international travel. The amount of travel was due to the support and monitoring nature of the work of the development managers with regard to projects.

Ms De Kock thanked the delegation for the presentation and requested that the Committee visit the projects as to experience the reality on the ground. Further, did the NDA funded projects have to submit annual reports to the NDA or was there another mechanism of accountability.

The accountability system was one of monitoring reports. The NDA released funding in tranches and such tranches would not be released where there was failure to submit a report. The report would contain the progress of the project in terms of achieving core mandate objectives at given periods. At the end of the project, close out evaluation reports are compiled where the project in its entirety would be evaluated. The project would also have to submit a financial report.

The Committee’s visit to the projects would be greatly welcomed.

Ms Malgas sought clarity on the status of the commitments as the financials were a hybrid of cash and accrual accounting and whether the monies were given out.

Mr Zwane replied that the cash flow statement reflected payment to NDA funded projects totalled at R73.2 million reflected as commitments in the opening balance and have thus since been paid. The current commitments were to be released in the next period. There was a target in the APP that spoke to how quickly project funds were released and this was placed under review on a quarterly basis.

The Chairperson thought it helpful to bear in mind the issues raised in the Shukumisa presentation in relation to the capacitating mandate of the NDA. It would be helpful for the Committee to have its own recommendations. It was then asked of the NDA what their view was of Inter-Governmental Relations in terms of interactions or cooperating with provincial organisations.

Dr Nhlapho addressed the question on collaboration by stating that the NPOs supported by the NDA were the very NPOs based in the communities. The NDA identifies them and whether they are within the core mandate areas. Where the organisation finds smaller entities that service a thematic area already covered by the NDA, ECD for instance, the NDA will then partner with that entity in that community.

The Chairperson elaborated that a situation where there was unhealthy competition for NDA funding and overlooking of organisations not founded by the NDA was to be avoided.

The Chairperson commended the department’s improvement and cooperation with the Committee. Further related closing remarks to the members were made with regards to compiling future recommendations and reports.

The meeting was adjourned.

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