Department of Home Affairs, IEC & Government Printing Works on their 2013/14 Annual Reports

Meeting report

Opening remarks
The Chairperson welcomed members back from their lunch break and requested the delegation from the DHA to respond to the questions posed earlier by Members.

DHA’s response
Ms Fatima Chohan, Deputy Minister, DHA, said that the Department was in the process of developing a digitized system which was going to place them at a different level when handling its affairs, and requested support in the acceleration of this modernisation plan from the Committee. With regard to the financial management of the Department, she said the senior management of its units had been fairly unstable. In September 2013 the Department was affected by the resignation of its Chief Financial Officer (CFO). The Minister had then appointed an acting CFO, who also left the position due to health problems. In September 2014, a new CFO was appointed and this was going to provide the Department with stability in the finance department and would put them in a good position to address its financial challenges.

The issue of accountability within the Department was a highly prioritized issue not just in terms of financial management, but also in terms of performance. They could not focus on one issue at the expense of the other. They were going to have a break-away session with their senior managers to address the issue of professionalizing the Department. Professionalism was going to be the one criterion adopted by all of the employees -- from the cleaners, to the individuals attending to the clients as well as individuals in the management office performing management functions. This was one of the main objectives in transforming the DHA.

One of the issues that the Department had embarked on was the achievement of its targets, where they had had to “tweak” some of the targets because they operated in an era where everything was about speed. They wanted to address reports where in the past; the DHA took over 300 days to issue an ID book. However, the Department had to address these issues in consideration of the country’s security needs and thus the real question which needed to be posed was whether the set targets were realistic and relevant in the South African context. While they were able to adjust the targets, they had not been able to achieve all of them because some were unrealistic. It had achieved only 50% of the targets. The DHA had to ensure that they maintained a high quality of its targets. For example, it had to set up mechanisms to establish that people awarded permanent residence in South Africa actually added value to the economy. There was a need to establish whether the targets set were in the country’s interests. If these interests were not taken into consideration, the levels of accountability of the Department became blurred and there was a serious need to revise some of the targets set by the Department.

Mr Mkuseli Apleni, Director General, DHA, said the management wanted to establish a Department which was efficient and run effectively in all aspects. He did not think that the challenges were beyond resolution. On the issue of how the Department could ensure that their disseminated information was correct, he said that this was covered by the presentation where it had been indicated that the Department was going to first deal with issues which could be seen by the people, such as the refurbishment of 70 offices, the issuing of ID cards, or SMS message on the status of applications to the DHA. All this information could be tested to determine whether it was accurate or not.  

The Department was also in the process of setting up a border management agency for completion by 2015. The Department had a plan to improve service delivery and had reported this process to the Minister. The Department had instituted disciplinary processes against people carrying out functions they were not mandated to carry out, as well as disciplinary hearings for managers who had not declared interests in the transactions of the Department. Although there were only a few incidents, the Department was dealing with them. The issue of accountability within the Department had been seriously dealt with.

The Department was not happy that it had achieved 53% of its set targets and was establishing processes to improve. The targets were being monitored in the quarterly reviews to make sure that they were on course for achievement, as well as to identify the reasons why some of the targets were not being achieved.

On the question of contingent liability, the Department did not budget for this, but in the event that they lost a law suit, they then turned to National Treasury for help. The common practice was that they did not budget for any law suit. The operations of the Department were not affected by the issue of contingent liability, and the issue was to make sure it did not increase. The legal cases presented on were old cases, and the Department was making sure that they decreased the contingent liabilities. On the issue of “Ecodifame,” he said that people colluded and that was why the Department had to discipline people and the case was gone to court. The court had granted the Department the right to freeze a specific bank account because of the collusion between the people. Thus, the Department’s established system had enabled management to pick up how a particular individual had been paid a given amount and stop the payment, but if the system had failed, by the time they reached the bank they would have found no money. The matter was still being addressed by the court, where all the parties were fighting for the money that was frozen in the bank account, but the people who were involved had been properly disciplined.

As a Department, they did not procure properties themselves, so “Allmark” was not a property it had procured. It was procured by Public Works. With regard to registers, the Department used a system called “BOARD” for the registration of its assets, which was not a paper asset register but was within the “board system”. The aim of the register was to make sure that it was clean and met all the requirements of the DHA. On the issue of training, the Department had a target of 60 members and when the 60 had been trained, seven more members were trained to fill the existing gaps. However, the same budget issued for the training of the 60 people was the one used for the training of the 67 people. No additional resources were used.

The DHA should be part of the security architecture of the country. This did not mean that DHA had to be securitized, but if a document issued by DHA is acquired fraudulently, the impact of this on the security of the country is enormous. For this reason, there was a realization that the DHA should move to the Justice, Crime Prevention and Security (JCPS) cluster. For this to be implemented, it had to be determined whether a legal framework was needed in order to be able to deliver the DHA services in a secure manner, which was why the issue had been forwarded to the Cabinet for evaluation.

On the case management system, the DHA was planning on developing this system, but had to follow a tender process and at the same time not leave it out of their modernisation process, so it had come up with another independent system not interfaced with other systems.

Drastic measures had been established to cater for the training of staff members. The DHA was developing a proposal on how to deal with this issue, and was concentrating mainly on service delivery. The staff did not have time to meet and discuss how they were going to approach the work of tomorrow. The DHA offices were opened at a time where all the staff had to be present to execute their functions. Management was often frustrated on their visits to the DHA offices, because they could not engage the staff on how to improve their service. If time were to be allocated to engaging with the staff, management would know about the contents of their work registers and ask them why they were not performing some of their functions. The Deputy Minister had been given the task of implementing an office improvement programme to ensure that the offices of the DHA had a balanced mechanism of operation. If this was not taken into consideration and the management focused only on one side, their operations would be affected. One office manager had complained to management that he lacked a back office where he could sit and execute his functions. Some offices lacked individuals responsible for finance, so the finances were managed by front office clerks. This state of affairs needed to be changed, because raising the targets would be in vain if this situation was not addressed.

He said that at the ministerial level, clear agreements had been given as commitments on how to deal with the issue of the disclaimer in the audit opinion. Management had taken on these commitments and would be able to report on the practical mechanisms they will put in place. For example, the DHA was appointing over 200 interns to assist them with executing its mandate. They had issued an order of about R3 million to buy scanners for use in the offices, because most of the offices lacked scanners.
The plans of the DHA were not supported by resources. Not all the DHA offices had furniture, so funds for the purchase of furniture had been earmarked. Although this was a problem, it was no longer a priority, and resources were being directed to deal with more urgent matters.

The Chairperson thanked the Deputy Minister, the Director General and their delegation for their presentation and for responding to the questions posed by the Committee. He was looking forward to another opportunity to engage with the Department. He suggested that they take the unpopular decisions they had alluded to in their presentation to solve some of the problems. The Committee was there to assist the Department if they ever needed assistance.

He then invited the Independent Electoral Commission (IEC) to make a presentation on their annual report.

Briefing on the IEC Annual Reports for 2013/2014
Opening remarks
Mr Terry Tselane, Vice Chairperson, Electoral Commission, conveyed the apologies of the Commissioner who could not be present at the meeting because he was in Mozambique, together with a delegation from the IEC, helping that country with its election process. The report to be presented was a product of the collective effort of the Chief Electoral Officer, the Commissioners, the deputy CEO’s, the head of the staff, provisional and electoral office staff and the 218 000 staff members that the IEC had during the elections. He said that the reason why he was mentioning all the parties that had participated was because it had been developed during the time when the IEC was running the elections and therefore each and every person employed by the IEC during that period had a responsibility to ensure that the organisation's systems were not tampered with, or compromised, which had enabled them to come up with the kind of report which they had. They were very excited that they were presenting a very clean audit. In 2010, when they appeared before the Committee, they had been extremely embarrassed because for the first time in the history of their organisation, they had received an audit qualification, but fortunately they had been able to deal with those issues and no longer had those problems and had systems in place as well as a commitment. They would keep on trying to ensure that they receive clean audit report and at the same time be able to deliver on the mandate of the organization.

He said that he was going to respond to the question the Committee Researcher had raised earlier, on where the electoral Commission derived its mandate in terms of delivering elections for all other institutions. If one looked at Chapter Nine of the Constitution, particularly section 190(1), it outlined the responsibilities of the Commission and these relate to the three most important issues. These were the management of the elections of the three spheres of government, ensuring that the elections were free and fair, and declaring the results thereof. There was an important section -- section 190(2) -- which stipulates that the Electoral Commission has additional powers and functions prescribed by national legislation. This legislation relates to the Electoral Commission Act, which covers the responsibilities, powers and functions that are not necessarily contingencies in the constitution. Under Chapter Two, section four of the Act, which deals with the objects of the Commission, it stipulates that one of the responsibilities of the Commission is to strengthen constitutional democracy and promote democratic electoral processes. Section 5(1) (d) refers to the promotion of knowledge of sound democratic electoral processes. Section 5(1) (k) talks about the promotion of voter education. Section 5(2) (d) says that the Commission generally performs any act that is necessary for, or conducive to, the achievement of its objectives. He was raising these issues because they begin to locate all the other responsibilities of the previously mentioned functions of the IEC, particularly the issue of strengthening electoral democracy. Thus, the Commission uses various strategies in order to strengthen electoral democracy. Sometimes this process requires entering into discussions with certain institutions, assisting them in running their elections, as part of the Commission’s responsibility. The function of the Commission must always be seen within the outlined context.

Briefing on the IEC Annual Report
Mr Mosotho Moepya, Chief Electoral Officer, Electoral Commission, tabled the presentation on the IEC annual report. He said that there were five strategic oriented goals of the Commission. The first was achieving pre-eminence in the area of managing elections and referendums; the second was strengthening electoral democracy; the third was strengthening a cooperative relationship with political parties; the fourth was to strengthen institutional excellence and professionalism at all levels of the organisation; and the last was to strengthen institutional governance. The organisation had 50 strategic oriented goals and had managed to achieve 41, instead of 36 as previously mentioned by the Committee Researcher.

On ensuring accessibility and suitability of voting facilities and processes by establishing and applying infrastructure to meet operational demands for each electoral event, this area had three performance indicators.

The first was the number of contracted voting stations. For every election this strategic goal must be satisfied. They were planning on 22 000, because leading to the elections they had followed settlement patterns across the nation, which had led to 22 263 voting stations, meaning that they had over-achieved on this strategic goal. It was important to note that settlement patterns were developing at a very fast rate.
The second performance indicator was the number of schools used as voting stations. this was an important indicator for the Commission, as well as the Treasury, because it was proven that where they used schools as voting centres there was an improvement in the infrastructure of the schools because of the needs of the Commission. The Commission had under-achieved on this performance indicator by 1%. They had been looking at 66% achievement, but managed only 65%. The third performance indicator was the number of permanent warehouses and facilities used at the national and provincial level. In this area, they had achieved what they had planned.

On ensuring efficient electoral processes by defining, specifying and procuring election material for all electoral events, they had achieved that target as well. On increasing voter participation in elections, this had been revised and was no longer applicable, and thus did not form part of the strategic goals. Maximizing electoral justice for all stakeholders meant that the Commission had to ensure that elections were held in the time that they are supposed to be held, that every process was undertaken as they should and that there were no comebacks in the elections that they run. On this goal, the performance indicator was that if they did not achieve, they would have a number of elections set aside, but so far not one election had been set aside.

On enhancing the credibility of the voter’s roll, the performance indicator was related to the number of registered voters at the end of the financial year. The Commission had planned to have 24 175 457 and had over-achieved by recording 25 364 669 voters. This increase was attributed to three factors:

• a decrease in the mortality rate - the Commission had previously indicated to the Committee that the mortality rate for registered voters had in fact decreased;
• the increase in publicity surrounding the elections;
• the high level of electoral contests, which encouraged voters to get interested.

The IEC had also looked at the frequency per annum at which the voters roll was validated by the national population register. They had planned to do 12 validations per annum -- once a month -- and they were doing so. This was a process of the Commission that was very well run.

On improving compliance with legal prescripts; the objective had four performance indicators. The first was dealing with the percentage of elections for which the voters roll was certified -- every election would have the voters roll certified, thus achieving 100% on this target. The second indicator dealt with the average number of calendar days in which elections were conducted, from the date of the vacancy. The law required that they hold elections within 90 days of a vacancy arising, but because the elections arose any day of the week they tried and minimise the days so that they reduced the presence of office bearers for election purposes, and in that respect they managed to attain 77 days. This compared with 67 in 2012/13, and the additional ten days were due to the number of challenges dealt with in the Committee relating mainly to cases in KwaZulu-Natal and the number of by-elections. However, the IEC was confident that these time frames would continue to reduce. The third indicator was the average number of calendar days in which to replace proportional representation (PR) councillors. This related to the PR councillors that they replace on a regular basis. The law gives the Commission 35 days to complete the process, but it had completed it in 16 days. Contestations in the local government were very high -- within parties, among parties, in relation to councilors, and there were a number of cases that affected this replacement process. The fourth area was the average number of calendar days in which election results were declared or announced by the IEC. In this area, the law gives the Commission seven days; however the results are released immediately after the elections, meaning that they take only one day to release the results.

On continuously improving the legislative framework within which the Commission operates, one of the performance indicators is the number of electoral legislation reviews undertaken per annum. During the current financial year there were no legislative reviews because of the elections. Under this goal, the Commission also needed to look at the number of relevant bills submitted to Parliament per annum. They had planned to look at one bill, and had achieved this target. The other indicator was the number of regulations published in the gazette per annum. The IEC had planned for one gazette publication, but had published three. One of the three regulations related to the aspect of voter registration that had been dealt with in terms of legislative revisions, which also entailed the registration of voters outside the Republic. The second was related to SARS regulations for the submission of the list of candidates, and the third dealt with election regulation. For all the amendments that the Commission made to the legislation, they also had regulations which were affected by the amendments, and therefore on this aspect they had done all the work they needed to do.

On programme two, one of the strategic objectives was encouraging citizen participation by providing continuous education. One of the indicators that they had for this objective was on the number of civic and democracy education events held per annum. The researcher had correctly indicated that they had over-achieved in this area, but there had been a note that they had accounts for this which they had worked through with the Treasury and the Auditor General, to look at defining the event. One of the things that the Auditor General spoke about was that evidence was required in this area. The challenge was simply that when the Commission goes into a school to do democracy or civic education, the biggest challenge was, if they met 500 people, to produce auditable evidence that every one of the 500 people had signed the attendance register or had taken a photograph to justify their presence, and also putting this into a system. A system had been implemented in this financial period and would deal with this area.
The second indicator was providing strategic and thought leadership in the electoral processes for the work undertaken by the IEC to be at the forefront of the discourse of electoral democracy. In this respect the performance indicator was the number of thought leadership initiatives per annum. These are initiatives that facilitate public discourse on election issues. This was the Commission’s first year of such initiatives where it had set its target at 20 but had achieved 41.

The third objective under program two was broadening the Commission’s research agenda, dealing with issue of public publications and preserving institutional memory. One of the key indicators for this objective was the number of research projects conducted. The Commission had planned to conduct three research projects and in fact undertook three. The second performance indicator related to finalising and implementing knowledge management systems. In the 2013/2014 financial year, this could not be undertaken because of the elections, but implementation was under way for the current financial year.

The fourth objective was increasing institutional visibility through proactive consultation, effective communication and presence. Here the Commission looked at media opportunities and the number of interactions it has with the media per annum. He was very pleased to indicate that they had targeted for 30 media releases but had achieved 77, had planned on 100 media interviews, but had achieved 420 and had planned on 12 media analysis reports and had this target - one a month throughout the year. On the aspect of the number of stakeholder relationships and engagements established and maintained per annum, the IEC had planned to maintain 150, but had maintained 172 stakeholders because they were overwhelmed by the interest of these stakeholders to be part of the election process. Since this was a voluntary process, they had elected to take them on.

The fifth objective under program two was to facilitate platforms for stakeholder dialogue. The Commission had planned for 46 meetings, but only achieved 44. The two meetings which were not achieved were due to the fact that they had been moved to dates during the election period. The meetings were postponed to the 2014/2015 financial period, and their finding will be reported on in that report.

The sixth objective was the position of the IEC as a continuously improving organization through ongoing interaction and liaison with the relevant international stakeholders. Here the Commission looked at the number of interactions or liaisons which they had internationally. Many of these liaisons came from government initiatives through the Department of International Relations and Cooperation. They had planned for 13, but 26 of these liaisons had taken place with electoral Commissions, particularly in North Africa.

Programme three related to political liaison. Here the Commission was looking at deepening political engagement with represented parties, including convening consultative forums with registered political parties. Its first performance indicator was the number of liaison sessions with the members of party liaison committees at national, provincial and municipal levels. On this aspect, the Commission had not achieved its set targets, and one of the challenges related to holding of meetings, particularly at municipal level, where they experienced having to change days on which meetings were held because of the non-availability of party representatives, who indicated that some of the meetings were clashing with their municipal roles and responsibilities. The IEC had set out to provide attention in this area and was set to deal with it as it went into the future. The second indicator dealt with the funding of political parties on a quarterly basis, and the Commission had continued to achieve this. The third indicator was the number of training sessions conducted with political parties. In this regard it was indicated that the national office would have one session and each of the provincial offices would also have a session. In reality, there had been more sessions in some respects and less in others, than had been planned for. Further some of the sessions become regionalised instead of being based on provinces, but they had achieved what they had set out to achieve and had even slightly exceeded their targets.

Programme four related to corporate services. Its first strategic objective was striving for excellence at voting station level. This spoke to ensuring that the professionalism with which the Commission ran elections permeated to the lowest level of the organisation where they met with voters. The first performance indicator was the number of electoral staff recruited and trained per annum. The Commission had indicated that it would have 50 092 recruited staff members. A number of interventions occurred, like the streamlining operations, but also to a degree dealing with the issue of hostility in the environment, and in this respect the number of recruited staff was 46 251. This indicated that there was an under achievement by 3 841. However the increase in the number of area managers helped compensate for the reduction in the number of recruited staff, as well as having a buffer capacity of 25% of the members that were reduced to that level. This was an issue that the Commission would look at again. It had worked for them in the previously concluded elections. The second strategic objective was building institutional capacity. In this respect, the Commission had created new posts in its portfolio and filled them. The Commission had placed a number of staff members on short courses, since development was a significant aspect of the work of the IEC, and it had over-achieved in this area. The Commission had implemented a staff expansion programme leading to the elections which had been successful, where they had appointed a number of permanent staff per annum. The Commission had adhered to performance standards with the exception of a few instances, where there had been late appointments and one person had been on suspension at the time of issuing the report.

The fifth strategic objective was for the Commission to become people centred. It had set a target of ten but had achieved only seven because of the electoral process. The Commission’s audit report was unqualified, not “clean”, as was earlier stated by the vice-chairperson of the IEC. Strengthening risk management as a strategic objective was an area that had been very critical and was an area that the Commission was developing. The Commission was continuing with the work of strengthening this area because it was not where it was supposed to be. The Commission had not attained its objective on striving to comply with national climate change policies by developing and approving green policies.

Programme five dealt with governance and international liaison. The first strategic objective was refining institutional governance arrangements. This objective had four performance indicators, and two indicators had not achieved their set targets. The first was the number of governance meetings that were held in year. The plan was to hold 12 committees, one every month, but the governance committees did not meet for many of these sessions. The Commission had over-achieved on the Commission meetings held per annum. The Commission had planned to meet 11 times but they had met 13 times. This was caused by the election period, and was thus understandable. The other strategic objectives related to exercising oversight by ensuring the implementation of the Electoral Commission’s strategic goals and objectives aligned with the corresponding budget allocation, as well as exercising oversight by providing assurance and value-adding oversight, all of whose set targets were achieved.

Briefing on the financial statements for the financial year ended 31 March 2014
Ms Fiona Rowley-Witley, Deputy Chief Electoral Officer for Corporate Services, IEC, made the presentation on the financial statements of the Commission for the financial year ending 31 March 2014. She said that the Commission had an unqualified audit opinion. The audit outcome had one finding on the reliability of predetermined objective information in relation to programme two, with regard to the electoral outreach. However an outreach management system had been implemented to address this finding. There was also one correction to the annual financial statements.

From a contextual perspective, she said that the financial year ended on 31 March, the election was on 7 May, and the financial statements for the financial year were due on the 31May 2014, so there were areas with errors that had slipped through the financial statements while the Commission was paying attention to the holding of the elections. The basis of preparation of the financial statements was broadly the same as that of the previous year and the Commission operated on an accrual basis of accounting. Thus there were no changes in terms of the governments accounting policies.

The significant increases in expenditure were in three areas -- employee-related costs, expansion capacity both in terms of the operations as well as the outreach capacity that the Commission employed on a short term basis, and the cost of goods and services, which more than doubled when compared to the previous year. Broadly speaking, the key increases in expenditure included expenditures on communication and connectivity. The Commission increased its band width between the various local, national and the provincial offices, and there was an increase in telephone expenditures. The cost of workshops doubled during the current financial year. The workshops were mainly for recruited, as well as internal, staff on the electoral process. The travel expenditures in the current financial year had increased exponentially when compared to the previous financial year. The Commission’s professional services budget also increased significantly, due to aspects like the communications campaigns, enhancements in terms of electoral systems, matters of changes in legislation because they were trying to professionalise and improve the process of electoral services. The depreciation rate of the assets reflected on the financial statements was relatively stable, which reflected on the organisation’s relatively stable asset base. There was also a significant increase in expenditure on repairs and maintenance as compared to the previous year.

Looking at the statement of the financial position, she said that current assets and current liabilities for the financial year ending 31 March 2014 had increased exponentially as compared to the previous financial year, and this had been mainly due to the electoral process. On the other hand, the non-current assets and non-current liabilities experienced what would be considered as a slight increase from the previous financial year. The statistics indicated that the Commission’s asset base was relatively stable, and that the Commission reasonably paid all its bills within 30 days, although there were a few instances that had slipped through. On the whole, the payment of invoices was on track. During the election year, the entity had concentrated mainly on the local election, rather than the elections of other countries, so its financial statements did not reflect expenditure on foreign and local aid assistance.

Discussion
Mr M Hoosen (DA) said that when you think of an organisation that can move 218 000 people in one day, in one direction and get the right outcome, this related to being fit. He recommended that the Department sit with the IEC to learn techniques on how to move 10 000 people in one direction, because it seemed like the IEC had some useful information that would be helpful to the operations of the Department. He applauded the Commission for the work that they did, and for making South Africa proud on the international scene with their ability to put together election campaigns.

He inquired into the allegations of an increase in court challenges on the electoral process between political parties. He wondered whether the electoral legislation was sufficient to provide an environment that would promote free and fair elections. It could not be right to say that the Commission only tried to bring a free and fair election process, where “process” meant the day of the election itself. The events leading up to the election also contributed to a free and fair election process. He used the example of the Western Cape government, saying that if the Western Cape government intensified advertising in the months running up to elections, this would favour the results of one political party over the other. He requested clarity on whether the electoral legislation was sufficient to promote a free and fair election, because the indicator for him was the court challenges -- the more political parties fight in court over the election process, it means there is insufficient legislation to actually regulate the election environment. Often when one brought a matter to the IEC, they referred one to the SAP, and when one runs to the SAP they refer one back to the IEC. He said that there may be another tool in place that would regulate the manner in which political parties conducted themselves between the elections, not only during an election campaign. He was very interested to hear the IEC’s view on whether or not this aspect would be necessary in our current environment.

He also inquired into the aspect of voter registration. He acknowledged the fact that the IEC had exceeded their targeted expectations on the figures of registered voters, but wondered if more could be done, although the figure had been steadily increasing over the years. He wondered why the IEC did not do more in terms of actual outreach of voter registration, apart from just voter registration weekends. On the Election Day, thousands of voters had turned out, only to discover at the voting station that they were not registered. If they were present at the time, why not add a registration system to register them so that at the next election, they would be able to vote?. He was aware that the IEC had tried in several ways to increase the registration statistics and the evidence was there to prove this, but were there other innovative practices that could be adopted to increase voter registrations.

On the issue of fraud in voter registration, he said that this was a common practice which had occurred over and over again during the different elections. Political parties often complained about illegal registrations, people registering at wrong addresses or being manipulated by political parties to direct the results in favour of a particular political party. If a political party could use IEC systems to manipulate the election process, this surely meant that there could not be a free and fair election. He wondered whether there was a mechanism that could be adopted to address these problems.

Ms N Mnisi (ANC) commended the Commission for their presentation and for sticking to their constitutional mandate of promoting a conducive environment for free and fair elections. The IEC had room for improvement with regard to its audit opinion, having moved from a clean audit to an unqualified opinion. She requested clarity on the performance indicators under programme two that the AG had highlighted as providing insufficient audit information. It was clear from the presentation that there was a challenge with the IT operations of the Commission, and she asked for what was being done to address the continued low capacity in this area..

Mr A Figlan (DA) requested clarification on how the IEC had managed to finalise three sets of regulations within a year when it had planned for one; what type of work did the 7 015 semi-skilled casuals do in contrast to the 218 000 persons employed on a temporary basis in terms of the work only for election day.

The Chairperson asked whether the post of chief risk and legal compliance personnel had been filled, because the presentation did not provide information on this. When would this issue be finalized, so that whatever action the institution was taking would have to go through the risk assessment process and probably get legal advice, especially regarding the current lease agreements they were debating about? They needed to be properly advised in order to avoid the unintended consequences of fruitless expenditures. He said that there had been an outcry from people about payments from the IEC in the period under review. How had the Commission fared in dealing with this problem?

IEC’s response
MrTselane said that the existence of court challenges on the electoral process was not necessarily a bad thing. Courts, particularly the electoral court, were in existence to assist with the electoral process. If there were disputes over the electoral process between political parties, they should always be able to have a fair review through a court process, and the electoral court specifically assists in dealing with electoral issues. He thought that the electoral legislation of a country was dependent on the specificities of the particular country. For example, in the case of India, on the day of the elections almost all the state instruments were in the hands of the Electoral Commission and therefore during the election period you could not find a Minister launching a programme during the week of the elections. This was contained in their legislation and its Electoral Commission implemented these provisions.

The IEC recently had a meeting with the political parties, where the parties raised many issues relating to the principle of free and fair elections, which they wanted the Electoral Commission deal with. The Commission had indicated to the political parties some of the difficulties they had in this area. For example, some of the requests of the political parties were not in the legislation, thus not in the realm of the Commission and therefore if they wanted to pursue those issues, and empower the Commission to deal with some of them, then the legislation would have to be changed. He said that the Commission had agreed with the political parties on a workshop to address all the issues that the political parties had raised, and a discussion paper addressing these issues would be produced and circulated to them to see and understand the environment in which the Commission was operating, and also understand the respective roles and duties of all other bodies in the electoral sphere. They were hopeful that the conference would be able to give them guidance on the type of issues that the political parties would like to see changed in the legislation. Just as a caution to the political parties, he said that sometimes he got the impression that they wanted to use the notion of free and fair elections to influence the Commission to take one position at the expense of the other, and it would be very dangerous if the Commission was forced into such a situation. The Electoral Commission had to be given space to be able to perform the responsibility of running the elections without getting involved in the events which the political parties normally get involved in during the campaigns.

Ms RaenetteTaljaard, Commissioner, IEC, said that there was a need to look into the constitutional hierarchy of the co-dependencies that exist in order to resolve the disputes often fronted by the political parties because she felt that the political parties had an expectation that the IEC would solve all their problems if they stepped into its terrain. However, this was not the case, because constitutionally and legally the IEC would not just interfere with the terrain of other entities which also provided a deeper solution for free and fair elections. There were co-dependencies with the Independent Communications Authority of South Africa (ICASA) and the municipal demarcation board, as well as clear areas that indicated that when dealing with criminal offences under the Electoral Act, this was a SAPS matter. She often got the feeling that when these issues were discussed, they were discussed in a way that made the amendment of the Electoral Act seem like the complete solution, which was not the case, because of the existence of the co-dependencies. If there was a deeper discussion on the above-mentioned issues, they tapped into the deeper co-dependencies and aspects of constitutional hierarchy in the constitutional architecture, and this did not diminish the full mandate of the IEC. From the above, she said that the Electoral Commission Act would not be resolving the deeper issues where there were co-dependencies, because those matters required a much deeper interrogation.

Mr Tselane said that the Commission had continuously tried to find innovative ways of dealing with border registrations. He said that from time to time, when there was a registration process, an innovation was established to simplify the process and make it easier. Therefore some of the challenges presented in the annual report were aspects that the Commission was looking into, to see what it could do to solve those challenges. In order to have registration, there was a need for infrastructure. For instance, they needed a map to indicate the boundaries of where a particular person resided, and a registration form to ensure that you register the person in the right voting district. Thus, the innovations of the Commission could be implemented only if they were not going to create confusion with the voters, or the voters’ register. However, the IEC was looking into all the innovative ways of making sure that they could register as many people as possible. The Commission had to continuously find innovative ways of improving the process of registration.

The Commission had faced the issue of the political parties influencing the outcome of an election, especially the by-elections, by coaxing voters to vote in their favour. The only thing that the Commission could do at this level was to keep on appealing to voters not to get coaxed. The manner in which a registration was captured says that a person must register where they ordinarily resided, and in registration a place of ordinary residence is defined as a place to which a person will return to after a period of temporary absence. Thus, if a person could provide proof of ordinary residence, he/she could register in that area. The registration requirement does not say that one needs to provide proof of a physical address, so it is difficult forf the Commission to be able to tell whether a person is indeed fraudulently registering or whether the person had come to a particular area after a time of temporary absence. The Electoral Commission often appealed to the political parties not to contaminate the voters’ roll, because they had the best voters’ roll which was very current, compared to other nations of the world.

Mr Mosotho said that the findings of insufficient evidence raised by the Auditor General (AG) related to the performance indicators on the number of civic and democracy events held per annum, and the number of stakeholder relationships and engagements established per annum. To resolve this problem, the Commission had developed the outreach management system which would be used to capture the required evidence information, as required by the AG. The Commission had previously worked on an outsource model, and were re-looking at this situation to see if a combination of insourcing and outsourcing would be applicable to resolve the problem of incapacity.

When the Commission looked at any primary legislation in any area, they also looked at the implications it might have in terms of regulations so when they drafted the one, they also looked at the other and by the time one was approved, the other was on its way to be completed. The Commission had approved a number of measures, including bringing in a professional for a period of one year to deal with the chief risk and legal compliance position, and expected that better reports would be presented to the Committee in the next financial year. Regrettably all the payments for the electoral staff had not been paid, and this problem in 2011 had led to a qualified audit report. The Commission needed to be sure of the persons to whom payments were being made, but often faced a challenge of recruiting people in advance and taking their payment information, and then they did not turn up for work on the election day. This forced them to improvise by employing random people whose payment details they did not have, but would be captured later on after they have executed their functions. This meant that these individuals could not access their payments at the same time as the persons whose details the Commission had. The Commission was also faced with problems like changes in payment accounts, dormant accounts and as such, payment could not be processed.

The Chairperson asked the Commission to continue to do everything within its power to ensure that the integrity of the IEC was intact, as well as requesting the political parties to do whatever is supposed to be done to ensure that the electoral processes yielded results that are acceptable and legitimate. It was the responsibility of all citizens to ensure that the elections of the country continued to rise high so that everyone was happy about the IEC’s integrity and the acceptance of our electoral results.  As a caution to the IEC, he said that with whatever measures that they took, politics would always run ahead of them, so they needed to be more vigilant, robust, responsive and smart -- like the political parties that participated in the elections. He also recommended that the political parties use the tools available in the legislature to safeguard the integrity of the IEC

Briefing on Government Printing Works’ annual performance report 2013/2014
Professor Anthony Mbewu, Chief Executive Officer, Government Printing Works (GPW), tabled the presentation on GPW’s annual performance report. He said that the organization ran ahead of the forgers which was not the case with the IEC -- whatever the forgers devised in terms of forgeries, they were ahead of them in terms of their security technologies!

He said that the GPW was 127 years old and was currently undergoing a period of rapid transition in terms of printing technology and the work of state printers worldwide. The organisation was a government component reporting to the Department of Home Affairs. It was made a government component on 9 October 2009 and listed in schedule three, part (a) of the Public Service Act of 1994, as a mandate. At that time, the National Treasury and Department of Public Service and Administration (DPSA) felt that the GPW was not ready to become a state owned company and that there should be a transition phase under a government component to ensure that their business was stabilised. The purpose of GPW was to deliver security printing and related services to the government of South Africa. In terms of its strategic outlook, GPW saw itself evolving into a printing media company comparable to other leading printing security companies around the world, such as the United Printing Office in the United States.

Their vision was to be the state’s mandated security printer. Their mission was to provide cost effective, reliable and timely services in security printing to all spheres of government; to provide the public with valuable information; and to disseminate government information through technology innovation and service excellence. As a security printer, their values were reliability, integrity, accuracy and stakeholder satisfaction.

They had three strategic outcome-orientated goals for the period 2013 to 2018. The first was to further develop the government component to become a state-owned company; secondly, to optimise processes and facilities to increase operational effectiveness and improve customer service; and thirdly, to have an efficient, effective, well trained and deserved work force, and a special remuneration dispensation for the government component. There were four branches of this company. The core branch was operations and productions. They had a manufacturing outlet where they manufactured security products. Strategic management was critical, particularly the sub-branches of information and communications technology, which was quickly becoming part of their internal business process, as well as the form in which they delivered government information to the general public. Marketing and stakeholder relations was key, and security, because it was a security printer. The third branch was financial services -- if they were to be a profitable, sustainable government business, then financial services was key, as well as supply chain management. The fourth branch was human resources. As they transformed into a printing media company, embracing all the modern technologies that state printers currently use, their human resources must be developed, skilled, trained and well remunerated for their jobs.

In terms of their key projects, there had been the upgrading of the electronic gazette so that the material could be submitted in electronic PDF files. This project should be launched within the next month or two. Upgrading of the Enterprise Resource System continued. Development of pavilion three began in December 2013 and this would be converted into an examination centre, using high speed digital printers and a dispatch centre for dispatch of passports, smart ID cards and examination papers. This should be completed by the end of 2015. The development of a master plan for the Visagie Street site began in December 2013, but there had been a lot of delays in the renovations, partly because of difficulties with another government department, but the process was under way they expected the renovation of the entire site to be due for completion by the end of 2017. The passport and ID card facility was a R1 bn facility that is second to none in the world, including high income countries. Other key projects during the period under review included finalising the plans for the new refugee passport. The United Nations refugee agency (UNHCR) had instructed various countries around the world to update their refugee passports, and plans were also underway for an E-passport sometime in the next year or two.

The flagship project for the past few years was the smart ID cards project. The project was launched by the President on 9 August 2013 and the production of the smart ID cards began on 15 October 2013. By the beginning of October 2014, 700 000 smart ID cards had been produced and the monthly production rate of the smart ID cards for the first time overtook the rate of ID book production in June 2014. The Department’s target for this financial year was to produce 1.5 million smart ID cards, and it was likely to be exceeded. The smart ID card project planned that the 38 million ID books currently in circulation could be replaced by the end of 2021. This demanded a production rate of 5.4 million cards a year, or approximately 450 000 cards a month, and within 12months they should be reaching that production rate. A disaster recovery site was also ready for use whenever the need arose.

The production rate for South African passports had stabilized during the previous financial year. Since the new South African passport was introduced in 2009, there had not been a single successful forgery among the four million or so passports that had been produced. Since the launch of the E-gazette, subscribers were resorting to the use of the e-gazette rather than the printed government gazette -- they access the soft copies of the gazette and can download and print a section of the gazette that they need. On average the subscribers of the government gazette use only 2% of the gazette, and this may create savings in terms of paper

Mr Rassie Barnard, General Manager: Financial Services, GPW, said that the organization’s turnover had dropped, when compared to the previous year. The reason for the lower turnover than the previous year was that big projects from the Department of Education had not materialised, and there had been a delay in the smart ID card roll-out. The organisation had tried to contain its expenditures and be as cost effective as possible, but there was still room for further improvements. Although the turnover had dropped; the entity’s gross profit had increased. They had been able to achieve a gross profit percentage of 36% compared to the previous year, where they received 22%. They had a successful year with regard to their return on capital investment -- they had a target of 28%, but had achieved 44%.

The GPW did not receive government funding. It was an entity that had to drive its own income and take care of its own expenditures. Although they had made substantial investments in the smart ID project, they were still able to have an increased cash flow. However, they needed to make improvements in the area of debt collections. They had set themselves an ambitious target of 60 days, whereas government departments were supposed to make their payments within 30 days. They had achieved only 77 days which was an improvement from the previous year’s 88 days. It was very important for the GPW to maintain the level of profitability that it had achieved in the last couple of years, because it had several projects which required this funding in order to transform the organisation successfully.

Professor Mbewu said that in terms of transformation, the GPW had transformed from its position in 1994 where it was 100% white and predominantly male to an environment with a workforce of 555, of whom 54% were male, 64% were black Africans, 30% were whites, 5% coloured and 1% Indian.

In conclusion, he said that the GPW had successfully completed its conversion to a government component in the years 2009 to 2013. It believed that it had achieved its vision of becoming “the state’s mandated security printer,” although this still needed to be put into legislation. The GPW was now ready to complete its transformation into a “state-owned company” over the next few years. Progress had been made in becoming a modern “print and media company.” The business was expanding as more and more government departments brought their work to the GPW.

The Chairperson requested that going forward, the report of the GPW should separate its annual performance plan report from the annual report. He then requested a presentation on the annual performance report.

Professor Mbewu said that theGPW had succeeded in achieving 71 of 104 targets set under their key performance indicators and 37 of 49 targets set under their strategic objectives for the year under review, but in many instances where a target was missed, the circumstances were beyond its control. They had maintained an unqualified audit opinion for the fifth year running, succeeded in reducing audit findings by 8.3%, achieved a turnaround time of less than ten days for the monthly financial management reports, and achieved a target of turnaround time of performance reports of 30 days. They had missed their target on revenue generated by a substantial amount, but exceeded their target on gross profit. They had missed their target of 60 days on the data collection period, where they achieved 77 days. They had managed to implement a human resource plan, but did not achieve the migration plan due to delays in the renovation of the relevant site.  They had managed to submit their special remuneration dispensation, but were not yet approved by DPSA. They had approved and implemented the human resources policies, but did not establish and implement a call centre. In terms of product diversification, the target was one product, but they had developed four new products. The marketing strategy had been completed and approved, and there were no security breaches in the ICT environment. They had not succeeded in mitigating all of the findings of the AGSA, although two of the three findings of the AGSA in the ICT environment were completed. They had missed their target on the percentage of internal audits completed -- the target was 100%, but only 73% was achieved -- and they did not achieve their target on the implementation of a security risk management plan.

Discussion
Ms T Kenye (ANC) commended GPW on the presentation which she said was clearly marked and had a legible font. She asked about the specific challenges which had forced the GPW to miss some of its targets, because the presentation had indicated only that they had missed some of their targets because of circumstances which were beyond their control. She also commended their unqualified audit report, especially in the matters of emphasis. However, she requested them to strive for a clean audit to avoid reversals. She said that it was easy to reverse the good work which they had done, pointing out that the reason they did not get a clean audit was due to a lack of compliance with the legislation on internal audit. How was this issue being addressed? She inquired into the state of readiness for the company to become a modern print and media company, and whether this would have any effect on the internal organisation of the company and its vacancy rate.

Mr Figlan asked why the financial information in the report was indicated in annual years, rather than financial years. He said that the report of the performance against strategy objectives was not clearly distinguished from reporting against performance indicators, creating confusion on the amount of targets that were achieved. The GPW needed to rely more on contract workers in order to improve the skills and professionalism of the internal workers.

Ms Mnisi commended the GPW on its fifth consecutive unqualified opinion and, as a Committee, they were looking forward to the time when it would get a clean audit report. She asked about the approach which GPW was going to use to address the internal audit problem, because they had achieved only 73% instead of the 100% target set. What was being done to improve on the rate of achieved targets set by the GPW? Why had they failed to implement the target of setting up a training academy?

Mr Hoosen said that from the statistics in the presentation on the number of smart ID cards printed in a month, this project could only be completed in 15 years, not seven, as the presentation had indicated. He was therefore interested to hear how this target was going to be met.  

Mr D Gumede (ANC) requested clarity on the issue of the GPW becoming a state-owned company. Did this mean they were going to rely only on their marketing strategies to access the necessary revenue to run their operations, or were they going to operate as a company that needed money from the government.

The Chairperson said that he had a problem with the outcomes on the target of investment, and requested clarity on this issue. He said that since the GPW had indicated that they had achieved the target on the special dispensation, had it been implemented?  If it had been achieved, then it should be readily available for implementation, and if it was not readily available for implementation, then the position that it had achieved became highly problematic.

GPW’s response
Professor Mbewu said that the principle challenge faced by the GPW was the renovation of Visagie Street which began in 2009 and was not half way through. The problem was the disarray of the Department of Public Works, although it had improved recently in that after a delay of four to five years, they had appointed a development team and it was hoped the renovation would be completed by the end of 2017. The other main challenge faced was the special salary dispensation. In the key performance indicators what was mentioned was that they had achieved the target of preparing the submissions on the special salary dispensation. These were submissions that the previous Minister of Public Service and Administration had requested her task team to compose with Department officials and GPW officials. A submission had been prepared and tabled about a month before the national elections, but nothing had happened after that. The current Minister had taken up the matter and was scheduling a meeting with the previous Minister to discuss the special salary dispensation. The Portfolio Committee had recommended the special salary dispensation about three years ago but it still had not been implemented.

He said that the Members were correct in asking for a clean audit. The GPW’s ambition in the current financial year was to achieve a clean audit. The only thing that had prevented them from getting a clean audit was the fact that internal audit had completed only 73% of its work. There were various reasons for this which they were addressing. One of them was the capacity to execute the audit function. They had recruited audit specialists and a chief audit executive, and were about to appoint a few more junior auditors as well as audit interns, to ensure that in the current financial year, 100% of the work was completed. If they achieved 100% of the audit plan and there were no other problems, they might achieve a clean audit in the following year.

The transition to becoming a modern print and media company was in a sense inevitable, because often printers around the world did it. The printing industry had changed. Currently information was delivered through the internet and ICT rather than through a printed sheet of paper, but this transition came with its own problems and had a profound impact on the organogram. This was a headache for the GPW, because they anticipated that after the transition the organisation would be very different. This was why the special salary dispensation was very important, because the highly skilled artisans that they would employ in the future came at a price, and were easily poached by other companies who were also going through technology transitions.

He said that the vacancy rate was currently 22%, and it had not improved since the previous year, but the vacancy rate was mainly a problem within the within the senior management service (SMS) grades. They had reduced their SMS staff positions from 32 to 25 in the organogram, but even with 25 SMS staff positions, only have of them were filled. The challenge was partly to find the appropriate staff, but also in their recruitment, to continue to obey the employment and equity law. Getting trained and highly qualified staff often involved paying a premium within the market, and not having a special salary dispensation made it difficult to fill the vacant positions. To achieve this, they needed to work within the parameters of the equity law.

Mr Barnard said that because the GPW did not receive any financing from the government, it reported its financial statements according to international standards with which they had to comply, so they had no option in adopting a mode of reporting, and thus could not change it. However, in future when they became a state-owned company, they would report their financial statements according to South African accounting standards, which were also in line with international standards.

The problem with specific targets was that if a given specific target encountered a problem, the compound was that it would affect other targets as well. In 2008, the GPW wrote a business case in which they developed an asset replacement programme which would be used to procure assets for future development. They had tried to keep the organogram as new as possible, taking into account the changes that they needed to go through. There were certain positions which were hard to fill because there was an option of filling a position, but there would be no work for that particular person. In the last financial year, investment in additional production assets was one of the GPW’s targets, but with the smart card ID project coming on board, they had had to concentrate on the facilities and machines that they needed to support this project, and that was why the investment in the assets did not take place as had been planned.

Over the last ten years, the GPW had proved that it could be a profitable business if it was managed properly. There had been a proposal of funding from government, but this was no longer needed because GPW was a self-funding organisation and was cable of looking after its own affairs. He did not like the GPW being compared to other organisations that received funding from government, because he thought that this was not totally fair. The organisation had a draft bill that was being researched and would be forwarded for parliamentary process in the bid to transform it into a state-owned company.

Professor Mbewu said that over the years they were trying to depend less and less on contract workers, and the workforce was increasingly becoming more highly skilled and technologically competent. The challenge was how to recruit such workers and retain them in permanent positions, as well as ensure that they were appropriately remunerated. They GPW was fully capacitating the internal audit to ensure that it had the necessary staff and financial skills to make sure that they completed their work plan. In their bid to improve on the statistics of the targets they achieved, they sit with the Auditor General as the executive to provide them with advice on ways to improve the statistics. They also look at the various stumbling blocks in achieving their targets -- for example, the days in implementing the new organogram.

He said that the main reason the training academy was not implemented in the current year under review was because they had managed to recruit a general manager for human resources, but within months she had left for a higher paying job, which had stifled the implementation of this important initiative. In order to reach the estimated 38 million smart ID cards by 2021, GPW needed to produce five million cards on an annual basis. This could be achieved by streamlining the operation output of the eight-hour shift. The target could also be achieved and the output doubled by introducing and operating two eight-hour shifts.

He said that the draft bill was in the Minister’s office and he was sure that he was going to be discussing it with the Portfolio Committee soon. They were making process in terms of getting their facilities renovated as well as properly equipped, so that newly trained-up and skilled workers would have the facilities to run the new machines.

Mr Gumede asked where the GPW got its funds from, and whether it would give its surplus revenue to the National Revenue Fund, like any other state company, or whether they were going to recapitalize it and use it for new developments within the company.

Mr Barnard said that the rules indicated that they should submit their surplus funds to the National Revenue Fund, and every year they applied for exemption because of the transformation they were going through. National treasury was fully aware of all the plans, and they often received permission to retain the surpluses.

The Chairperson asked them to base their plans on information which was reasonably correct, and thus needed to get their people who were involved in planning to really dig deep and provide the entity with information that was workable, to facilitate future development.

He commended them and all the other entities on their presentations.

The meeting was adjourned.