The Portfolio Committee was briefed by the Auditor General South Africa on six key areas of the audit for the Commission for Gender Equality (CGE). AGSA explained how the audit was conducted and consolidated, focusing on the financial statements, performance information and compliance with regulations, particularly in respect of supply chain management, where there were weaknesses which had led to irregular expenditure. This was worrying because the CGE was a small entity and therefore had routine procurement. AGSA suggested that the time had come for accountability and consequence management.
The CGE Chairperson said that the Commission was operating with an inadequate budget, given their functions and mandate. He raised concern about the Treasury’s plans to reduce the CGE budget by R4 million, and asked the Committee to debate the decision.
The performance overview including the planning of the CGE for transformation in the workplace in both the public and private sector, highlighting its projects on the decriminalisation of sex workers, the report on women in political parties, traditional leadership and engagement with Lesbian, Gay, Bisexual, Transgender and Intersex (LGBTI) communities.
The annual financial report included details of the financial position of the CGE and its management, issues of its human resources, and its audit outcomes. The core spending area of the budget was allocated to the compensation of employees, accounting for 64% of expenditure. There was a surplus in the budget, and assets exceeded liabilities -- the CGE was strong in terms of solvency and liquidity. An employee in the finance department had been dismissed due to financial misconduct, and this had been reported to Parliament in terms of National Treasury regulations
Members of the Committee asked the Commission numerous questions about its plans to combat the areas of concern, as highlighted by the Auditor General, especially how it planned to combat the problems it faced with supply chain management. It questioned why the CGE still had a 10% vacancy rate and why it could not be filled in a country where there was a high unemployment rate.
The Committee requested that the CGE send its monthly reports to the Portfolio Committee, and provide more information on its substantive work in its annual report. It was also stated that the Commission needed to take steps to protect rural women, especially those married to local chiefs. Once these men died, the succession rules resulted in destitute and vulnerable women. The Commission should also investigate the old customs that were no longer relevant, and which transgressed the rights of people -- women and children especially -- such as virginity assessments.
The Acting Chairperson welcomed everyone and noted that only the Commission for Gender Equality (CGE), and not the Department, would be presenting. Before the CGE presents its Annual Report, the Portfolio Committee had requested the Auditor General to brief the CGE on the findings of its audit on the annual report.
Auditor General on CGE annual report
Mr Ahmed Moolla, Senior Manager at the Auditor General of South Africa (AGSA), explained how the audit was conducted and consolidated, focusing on three areas:
- In the area of financial statements, the result an entity should strive for is no compliance or performance issues. With regards to the CGE, the entity was financially unqualified. This is the best audit outcome one can achieve.
- In the area of performance information on predetermined objectives, AGSA looked at the systems and processes in place during the year to enable accurate and complete performance reporting. Weaknesses were where the AGSA audit had identified information that needed to be corrected by management. With regards to the usefulness of the objective, the quarterly reporting needed to be accurate to ensure proper annual reporting. It needed to include the objectives, which were defined. The reliability of the information had weaknesses. CGE needed to be able to accurately report on its progress. AGSA audited what the target was, what had been delivered,- and what the reasons for the variance were.
- In the area of compliance of regulations, such as supply chain regulations, there were weaknesses which had led to irregular expenditure. The amount of irregular expenditure was concerning, especially in Supply Chain Management (SCM) and procurement. There was consistent weakness in this area, which was worrying because it was a small entity therefore had routine procurement. An area that needed to be looked at was the training of the supply chain manager, who needed to report to the auditor, who must ensure that the correct procedure for procurement happens. He suggested that the time had come for accountability and consequence management.
The Commission was encouraged to focus on improvement in the last two areas. He listed six areas the AGSA focuses on its audit, and encouraged continuous work by the CGE on its information technology (IT) and human resources functions. In summary, the issue of SCM is the area that is holding the CGE back from an unqualified audit, according to the AGSA..
The Committee Members had no questions, and thanked AGSA for their assistance.
Commission for Gender Equality on its Annual Report
The Chairperson and Commissioner, Dr Wallace Mgoqi, opened the presentation by referring to the independence of the Commission, which had been questioned due to the fact that the programme it had undertaken this year was on the eve of the national elections. He admitted that their role was biased in favour of the poor and vulnerable. The Commission had built significant relationships with non-governmental organisations (NGOs), faith-based organisations and the Traditional Leadership Tribunal. They were operating with an inadequate budget, given their functions and mandate. He raised concern about the Treasury’s plans to reduce the CGE budget by R4 million, and asked the Committee to debate the decision.
He thanked AGSA for their report, and noted the areas of positive changes, as well as the challenges. The CGE had begun to put together plans to deal with the problem of supply chain management.
Chief Executive Officer, Ms Keketso Maema, presented the performance overview of the CGE, including the planning around transformation in the workplace in both the public and private sector, and the plans to begin to hold organisations accountable. She said that government departments provide a limited budget for gender mainstreaming. Activities happened only in the month of August and around the 16 Days of Activities. The Department of Science and Technology had made a lot of improvement, but there was a lack of progress regarding gender equality in the South African Police Services. She discussed the implementation of policy dialogues and the Victim’s Charter. She highlighted that the CGE had dealt with a total 894 complaints of gender discrimination in the last financial year, and referred to the legal clinics held across the country. The current court cases in which the CGE was involved, were also described.
The CGE outlined its projects on the decriminalisation of sex workers, including the abuse of sex workers at the hands of the police and the need for sex workers to gain access to health care services. It highlighted the report on women in political parties, traditional leadership and engagement with Lesbian, Gay, Bisexual, Transgender and Intersex (LGBTI) communities. She stressed the lack of investigation by SAPS regarding violence toward lesbians, and other delays with the criminal justice system.
Ms Maema described the public education projects and the areas the Commission was able to cover in different provinces, as well as the use of community radio stations through its Memorandum of Understanding with the National Community Radio Forum. She spoke about the review of state compliance with its obligations under conventions and charters, pointing out the difficulties in the area of inheritance, poverty and equal opportunities for employment.
The CEO highlighted the achievements of the Commission in terms of internal strategic objectives, including the areas of human resources, policy dialogues, finances, and communications, but also noted the problems with supply chain management.
She concluded that the Commission’s resources had been appropriately used in line with its mandate, which had led to an improvement in its service delivery, and gave reasons why some of its targets had not been achieved, including a lack of response from various Ministers.
Annual Financial Report for 2013/14
Mr Moshabi Putu, the CGE’s Chief Financial Officer, presented the annual financial report, which included a review of the financial position of the CGE and its management, human resources issues, the Public Finance Management Act (PFMA) and its audit outcomes. The core spending area of the budget was the compensation of employees, which accounted for 64% of its allocation. He described the Commission’s expenditure in relation to the budget, highlighting the surplus and its sources of income, as reported in the annual report. Other sources of income to the value of R1.4 million were from donors. Due to vacancies, there had been a surplus on its personnel costs, as well as from interest and discretionary income from the Sector for Education and Training Authority (SETA). Later in 2014, all of the vacancies had been filled. In the period under review, there had been a balancing act. This had included under-spending by the CEO to compensate for other areas. The balance sheet showed that assets exceeded its liabilities, and the CGE was strong in terms of solvency and liquidity.
In his human resources presentation, Mr Putu reported on the Commission’s employment equity, staff leave, personnel costs and human capital management. An annual performance bonus was paid to 64 officials in respect of the previous financial year’s performance. An employee in the finance department had been dismissed due to financial misconduct, and this had been reported to Parliament in terms of National Treasury regulations.
The use of technology by the communications department, and its relationship with the SABC, was highlighted. He referred to risk management, including a discussion on litigation, and said that the CGE was being sued by a former service provider due to the cancellation of a contract.
With regards to SCM, the Commission had begun to implement consequence management, among other solutions, in line with the PFMA, and other forms of accountability. A clean audit was within reach.
Ms L van der Merwe (IFP) raised the issue of corporate governance and noted that it was the responsibility of the Portfolio Committee to hold the CGE accountable. The report had given no indication if all the commissioners had attended plenary meetings. Plenary meetings were important, as they were the final decision-making body. In the future, the CGE needed to include such information in the report, as most activities and targets not met were because of commissioners’ actions.
Chairperson Mgoqi said that plenary attendance was good -- around 90%. However, the CGE would provide an answer in writing to the Committee, including the attendance register of the 12 plenary meetings.
Ms Van der Merwe asked about the over-expenditure on travel and consultants, and the 13% increase in the budget. This was concerning. What could be done to curb this rate?
Dr Mgoqi answered that Parliament required the CGE to go to the deepest rural areas of South Africa, and travel expenses included driving and accommodation to remote areas, not just flights. The percentage appeared huge, given the small budget of the CGE. The Commission could do more to reduce the spending, however.
Mr Putu said the 6% increase in travel costs was due to the change in prices, inflation, and the increased activities undertaken by the CGE. It included travel and accommodation.
Ms Van der Merwe asked why the CGE still had a 10% vacancy rate and why it could not be filled in a country where there was a high unemployment rate.
Dr Mgoqi responded that the CGE had tried to fill the vacancies. Positions were advertised, but it was difficult to find people who are qualified to do the work.
Ms Van der Merwe said that the report listed “Critical Gender Challenges.” In future, these should not just be listed, but must include what could be done about it. The annual report had stated that 12 reports had been submitted as a target achieved, but it did not state what influence these reports had had on legislation and policy. The Committee would like to see all these reports.
Dr Mgoqi responded that in planning to address the challenges, it would begin to use the information in the SAPS annual reports on crime to inform the CGE of the hotspots it needed to attend to. He agreed that it was important to include information about what the Commission is doing in its annual report.
Ms Van der Merwe asked what the status was of the R30 million over-spending not condoned by the Department.
Mr Putu answered that the R30 million had come from previous periods. The Commission was waiting for the National Treasury to condone this. The CGE had undergone a vigorous process and the Treasury had emphasised the need for explanations, consequence management, and for liability to be determined.
Ms Van der Merwe addressed the issue of supply chain management as an ongoing challenge and asked what exactly the CGE was doing. To say that the CGE would address the challenge was not enough -- an action plan and time frame was needed. She asked when the Commission would see a move away from these SCM issues.
Ms N Tarabella- Marchesi (DA) asked why the decision was made for money allocated for increasing staff component to move to administration functions.
Ms N Tarabella- Marchesi (DA) referred to the gaps in core management and support staff, and asked if the CGE could not increase the support staff and take advantage of internships for young people to work on the ground.
Ms Maema replied that the Commission did have internship programmes. The human resources table in the report indicated that it had two interns in the legal and research department. It took the need to impart knowledge to youth very seriously.
Ms Tarabella- Marchesi asked if the reporting on achievements could be tabled for the Committee, and include what the nature of the Memorandum of Understanding being signed, was. It should include, statistically, what was happening with gender equality in the public and private sector.
Dr Mgoqi replied that it had a Memorandum of Understanding with the private sector. In 2009, the Commission had realised that the private sector was the worst performer in terms of gender equality. The Commission had analysed the Employment Equity Reports and had looked at worst performing companies. It had called on them to appear before the CGE and had found that they had begun to perform better. A site visit at Eskom had also been carried out to see the role and position women had there.
Ms C Majeke (UDM) stated that when there is a budget and spending is structured, irregular expenditure is unacceptable- and the reasons given are not acceptable. The Member called for the CGE to explain this.
In answering the question of irregular expenditure- Chairperson/Commissioner, Wallace Mgoqi stated that each CGE committee has been asked to look at the audit’s management report to identify issues relating to that committee. Each financial officer has been tasked with implementing the plan of action discussed with the Auditor.
Ms C Majeke (UDM) requested a breakdown of the outreach initiatives in municipalities and provinces. She pointed out that there were remote areas where women were unaware of the CGE.
Dr Mgoqi stated that CGE would submit to the Committee a report on areas it had visited and assured them that over the past five years, it had been to each and every municipality and had monitored these areas.
Ms M Chueu (ANC) asked for summarised presentations in the future, and complimented the Commission on getting an unqualified audit, but noted that it had performed well in only two of the six areas highlighted by the AG. She asked what would be done about the other areas. She said SCM was an ongoing concern and it had been reported that there had been a deliberate non-compliance with the regulations. The CFO had said there was training to deal with the matter, and she asked if it was specifically on the issues the AG had raised as a concern. Had the procurement staff been disciplined, as suggested by the AGSA? Did the CGE require the procurement officer to list the monthly expenses?
Ms Maema said that plans had been put in place to curb the problem of irregular expenditure. Previously, the CGE had not even had a supply chain manger. Irregular expenditure was often related to catering and such services, and the hiring of venues for events. She emphasised the need for proper planning and selection of vendors in this regard, to avoid irregular spending. The CGE was also awaiting the setting up of its IT processes to allow for proper management.
Mr Putu said that irregular spending was totally unacceptable. The CGE had held two five-day training sessions at the School of Government for its procurement staff, which included 20 staff members, as well as to their train supply chain staff. There had also been training of government policy for members of staff who sit on bid committees. They were empowering staff through training and now management needed to enforce oversight and hold them responsible.
Ms M Khawula (EFF) questioned why the money for performance bonuses in 2012 had been paid in 2013.
Mr Putu said that performance bonuses were paid after an assessment of performance when the financial year ended – the performance was therefore linked to the previous financial year.
Ms Khawula said that the Commission needed to take steps to protect rural women, especially those married to local chiefs. Once these men died, the succession rules resulted in destitute and vulnerable women.
Mr Putu said that the CGE was currently engaging with a case involving the wife of a chief. This reinforced the need to engage on substantive matters.
Ms Khawula said that the Commission should also investigate the old customs that were no longer relevant, and which transgressed the rights of people -- women and children especially- such as virginity assessments. This custom needed to be regulated, as it infringed on the rights and integrity of children.
A member of the delegation responded that the Commission was looking at this, and noted that there was a law, as found in the Children’s Act, that protected children against this.
Ms Khawula said that women were not given an opportunity to be local headmen. Women needed to be empowered in this regard, to enjoy equal rights.
Dr Mgoqi replied that there was a law in South Africa around the issue of electing women as chiefs and traditional leaders, which forced the Commission for Traditional Councils to have at least 30% female leadership. The CGE had taken up the project to look at whether women had real participation in these councils. The Commission had signed various MoUs with the House of Traditional Leaders and with different provinces. Many of those provinces, including Mpumalanga, had a department that needed specifically to be tasked with the issue of gender equality.
Ms P Bhengu (ANC) asked why the Commission had not employed disabled people and what it was doing about this. Only two of its employees were disabled.
Ms Maema replied that there had been challenges in employing people with disabilities. It was trying to fulfil an employment equity plan. When it runs an advert in local and national newspapers, it also runs one in the disability community, with the hope of achieving its objective.
Ms Bhengu (ANC) asked what the CFO was doing to address the issues of the audit.
Ms D Robinson (DA) noted the improvement in the audit, but stated that a “box ticking” exercise had been done -- for example, submitting a certain amount of reports. She asked what the outcomes of these reports were.
Ms Maema, addressed the issue of substantive work. The report, as well as the information pack given to the Members, did include some of the issues on the ground, the CGE policies and its work. The CGE would like to hold some of the departments to account with regard to gender equality, and feel it is important to find space to engage on substantive work done. She believed that there was not enough time in a meeting such as this, where the CGE was required to present its annual and financial reports. It requested a session specifically for presenting on its substantive work. Targets had to change, and the meetings were not in the hands of the CGE. It had requested meetings, with no response from departments.
Ms Robinson asked how people were evaluated for their performance bonuses, if Commissioners were also evaluated, and what the outcomes of these evaluations were.
Dr Mgoqi replied that Commissioners did not get bonuses - the President decided on that matter. The CGE approved the bonuses for its senior managers and staff members.
A Commissioner of the CGE also responded to the question, stating that a handbook had been created on the conduct, roles and responsibility of the Commission, based on its mandate and legislative requirements. The chairperson holds all commissioners accountable by way of submitting monthly reports on activities, and a quarterly report based on the strategic objectives of the organisation.
Mr Putu added that a performance management system happened annually to determine performance bonuses, with the committee that created benchmarks looking at all relevant factors. This was an area of oversight by the Commissioner.
The Acting Chairperson closed the meeting by stating that the Members were not yet convinced by the submissions made by the CGE. The pace of gender empowerment was concerning, and the CGE needed a clean audit. The Portfolio Committee would do its best to ensure oversight, and requested that the Commission send its monthly reports to the Committee every month.
The meeting was adjourned.
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