Department of Military Veterans on its 2013/14 Annual Report & its 2nd and 3rd quarter Performance for 2014/15

Meeting report

Department of Military Veterans (DMV) on the 2013/14 Annual Report

Mr Tsepe Motumi, Director-General (DG), DMV, said the overall performance overview for 2013/14 financial year showed that the Department had committed itself to 50 targeted performance indicators and 20 had been achieved, ten partially achieved, and 20 targets not achieved. This constituted to 40% achievement.

The performance per programme showed that under Administration, the Department had 21 performance targets, and 14 were achieved, four were partially achieved and three were not achieved. Socio-Economic Support (SES) under Programme 2 had 11 performance targets. Only one was achieved, three were partially achieved and seven were not achieved. Empowerment and Stakeholders Management (ESM) had 18 targets for implementation. Five were achieved, three were partially achieved and ten were not achieved.

There had been a target of 1 000 military veterans to be given access to dedicated counselling and medical treatment of Post-traumatic Stress Disorder (PTSD), and the actual achievement had been 507. There had been a target of 10 000 military veterans for access to health-care services per year, and the actual achievement had been 4 719. It was still concerning that out of 1 500 military veterans targeted to receive decent housing per year, only two managed to benefit. This once again showed that dependence on line function departments to deliver services to military veterans remained a challenge. The budget allocation had permitted the provision of only 505 houses.

Mr Motumi said that Priority 1 focused on ensuring a fully functional Department, with an independent vote, systems and processes. Progress as at 31 March 2014 showed that there had been delivery on this priority, and the Department had grown the Directorate of Military Veterans affairs -- which was within the Human Resource (HR) division of the Department of Defence (DOD) -- to a fully-fledged department, with a staff complement of 52 at 31 March 2013, to 123 by 31 March 2014. The department had its own transversal and accounting systems and building, and was serviced through a transfer payment from the Administration Programme of the Defence and Military Veterans Vote. The 2014 Medium Term Strategic Framework (MTSF) had entailed the realisation of a separate Military Veterans’ budget vote, with adequate funding to service the national, provincial, local and regional footprint of the military veterans community.

Priority 2 focused on strengthening governance and oversight protocols to give effect to the provisions of the Act. The Act established the governance structures and institutions to provide advice to the Executive Authority on the delivery of justiciable and justifiable socio-economic services to military veterans. The Act and delegated legislation had created four organs of state that report to the Executive Authority. These are the Advisory Council on Military Veterans, the Appeals Board, the South African National Military Veterans Association (SANMVA) and the Special Purpose Vehicle (SPV). The establishment of SANMVA gives substance to section 7(1) of the Act. The SPV emanates from the Ministerial Task Team Report, and was   established through the Military Veterans Benefits Regulations (MVBR), 2014.

Priority 3 mainly prioritised the provision of immediate social relief of distress for the most vulnerable military veterans. The DMV was collaborating with the South African Social Security Agency (SASSA) in the provision of this benefit provided through a Ministerial directive to military veterans eligible for such support. A list of 1 053 had already been forwarded to SASSA and service delivery had been activated in March 2014. To date, 833 of referred military veterans were already receiving social relief of distress. It was anticipated that as they accessed the Military Veterans’ pension, these military veterans would be no longer receive social relief of distress.

Priority 4 focused on the provision of comprehensive support services to military veterans and, where applicable, to their dependants. Progress in the period under review had seen the gazetting of the MVBR, which assisted in delivering the needed services to the veterans. This priority had been implemented, as mandated by section 5 of the Military Veterans Act, paying more attention on education, health care, pension and compensation, public transport support and burial support.

Priority 5 highlighted the importance of empowering programmes for and of military veterans, and a number of Memorandum of Understandings (MOUs) had been concluded for the provision of employment opportunities for veterans with the following state departments:

• Department of Water Affairs;
• Department of Rural Development and Land Reform;
• Department of Agriculture, Forestry and Fisheries.

These legal instruments yielded achievements during the period under review and the DMV had facilitated employment of 1 479 military veterans in partnership with the Departments of Water Affairs, Environmental Affairs, Rural Development and Land Reform, Agriculture, Forestry and Fisheries,   and Mpumalanga province (dam sites) and the Gauteng provincial Department of Infrastructure Development.

Priority 6 highlighted the importance of the military veterans’ heritage, memorialising and honouring them. In line with Section 5 (1) (c), the DMV in partnership with the Department of Justice and Constitutional Development, during the year under review, had facilitated the exhumation and dignified reburial of former liberation fighters who had been buried in paupers’ graves in Limpopo and North West. The DMV, in partnership with the Department of Public Works (DPW), had developed the design the tomb of the Unknown Soldier, which would be presented to Cabinet for approval.

Priority 7 paid more attention to the maintenance of a credible and secure national military veterans’ database. 16 150 personal files had been updated in the database. The update process was on-going. Currently, the Department was implementing the verification process in conjunction with the DOD, SANMVA and other MV organisations. 342 military veterans had been interviewed and 174 of them had been recommended to be included in the DMV database.

Priority 8 focused on the implementation of a high-impact communication and marketing strategy and plan, and a communication policy and strategy had been developed and implemented. In pursuit of the public participation programme, road-shows had been undertaken in nine provinces in support of the provision of health care cards, as well as informing and educating the military veterans about the mandate, programmes and services of the DMV. The Ministry, in partnership with the DOD, had mobilised military veterans in celebration of Mandela Day in Gauteng and the Eastern Cape. Military veterans had been mobilised in North West at the launch and showcasing of the two prototype military veteran houses.

During the 2013/14 financial year, the Department had received a disclaimer of opinion, as the examination had not been broad enough in scope to be able to form an opinion. The Auditor General of SA (AGSA) had highlighted the following key aspects for consideration:

• The Annual Financial Statement (AFS) indicated a problem of irregular expenditure, accruals, and tangible capital assets and opening balances and comparative figures of all items disclosed in the financial statements.
• The predetermined objectives highlighted concerns around the consistency of objectives, indicators and targets, measurability of indicators and targets and reliability of reported performance information.
• There were concerns around compliance with financial statements, performance and annual reports and expenditure management.
• The AGSA indicated that the Department had challenges with internal controls, especially the issue of leadership and financial and performance management.

The Department had developed an implementation plan to address all issues raised by the AGSA. These included a plan that clearly spelt out what each manager must do, with time frames attached. Defence International Affairs (DIA) was   spearheading this process, which was   assessed by the audit committee, which meets monthly. The DMV was   currently using Executive Council (EXCO) meetings to monitor the departmental dashboard.

In conclusion, the performance report showed how the Department had delivered 40% of its planned targets during the 2013/14 financial year. This was evidenced by the variance of 60%, where the Department had not achieved as planned.

Discussion

Mr D Gamede (ANC) said he would be as honest as possible regarding the overall performance of the Department. Disclaimers in general reflected badly on the Department and the Committee Members who were supposed to do oversight. It was disappointing that a number of targets had not been achieved and in principle, the partially achieved targets should rather be reflected as not achieved as at the end of the day, the partially achieved were still not really achieved. He wondered if there was a way that the Department could convince the Committee that the partially achieved targets should not fall under “not achieved.”

What was the challenge in the provision of 1 500 targeted decent houses to the military veterans, considering that the budget had been allocated? The annual report showed that there were only two houses that were built for the military veterans in North West what was the reason not to build two houses in each province? It had been indicated that one of the challenges in the provision of the targeted decent houses was the reliance on line function departments to deliver. However, the Department had still failed to host three events that commemorated military veterans without dependence on a line function. What was the reason for that? It had also been reported that military veterans owned about 23 companies, and he asked about the number of those who were benefiting from defence procurement.

Mr Gamede asked the Department to explain further the meaning of “number employees additional to staff establishment,” as shown in the table on employment and vacancies. It was disappointing to see that the staff complement was not complete, while there was a big number outside the establishment. It was always worrisome when the AG commented about compliance and internal control, as those were two basics of financial accounting. What could be the reason for such a problem within the Department?          

Mr B Bongo (ANC) said that Mr Gamede had already asked almost all of the key questions, but he would like to reiterate that a disclaimer was always worrisome to the stability of any Department. What was the turnaround strategy to avoid a disclaimer in the next financial year?   What was the extent to which the legal instruments must wait to support the Department in terms of section 5 of the Act? He agreed that partially achieved targets should indeed rather fall under ‘not achieved’, as the target was essentially not achieved. What was the extent to which the SANMVA was assisting the Department to execute its mandate? What was it that the Portfolio Committee could do to the Department to enhance the SANMVA and make sure that the Department fulfilled its mandate?

Mr J Skosana (ANC) said the presentation showed that things in the Department were not going well. The military veterans were very important to the Department and the country, and they needed to be empowered. The budget allocation of the Department, together with the expenditure, gave a clear picture of the financial management problem. Was there a plan to address this problem?             

Mr S Esau (DA) said that the AG’s report showed that the Department could not meet most of its targets. This was a huge concern, considering that the Department had been filling vacant posts. Any disclaimer spoke to the fundamental issues of internal control and efficiency, and this was problematic when considering that the Department was staffed by 123 (90%) of the 135 funded posts. The department had 52 additional posts, plus contract workers and a secondment, meaning the department was operating with almost 180 people -- way above the actual complement approved by the Department of Public Service and Administration (DPSA).   Clearly, the Department had been leveraging on 52 posts “free of charge.” It was not only junior positions involved, but all other positions, as this was shown in the AG’s report.

Mr Esau highlighted that the Department needed to get competent, qualified staff that would be able to execute their mandate, which was honouring the military veterans. The Department needed to go through an intensive training programme to get individuals to perform their tasks. The AG’s report was a true reflection of the incompetent and untrained staff within the Department. The AG had raised the issue of material mismanagement and audit evidence about the amounts and disclosures in the Department. The Committee had adopted a report which was outstanding, of the DG and Minister asking for the internal audit report and the subsequent forensic report, which had to be overseen by the DG. The report referred to a Deputy Director General (DDG) that had been suspended and subsequently re-suspended, and there was a Chief Financial Officer (CFO) that was on a sick leave. This was a huge concern for the Members, as it meant that the most senior members of Department were not available for three months. Where was the report that spoke to those issues?

Mr Esau said that the AG report showed there were problems regarding the procurement process that had not been followed, money that had been unauthorised and irregularly spent, and standard operating procedures that had not been followed by the officials. He emphasised that the AG report showed that the Department was in a dire situation, and this problem could not be solved by simply asking about the turnaround strategy. The right questions should focus on the mess that still needed to be cleaned out, and on the people responsible for causing the current mess in the Department. The disclaimer did not point merely to a simple matter which could be put straight, but to a fundamental, underlying problem.  

Mr Esau said that although the increase in the staff complement from 52 in 31 March 2013 to 123 by 31 March 2014 was an overachievement, this did not speak to the quality of people being appointed and the failure of the Department to comply with Employment Equity (EE). The fact that the Department had failed to deliver on its mandate despite the size of its staff, spoke to a lack of management and leadership, and the Minister needed to account for this. The Minister also needed to come to the Committee to brief the Members regarded the current state in the Department and the steps that had already been taken to stabilise the situation.

He expressed disappointment that there were so many targets that had not been achieved. This could not be blamed on a lack of capacity, as the Department had about 52 additional staff. It was strange that the department failed to accomplish a lot of work, such as targets, legal instruments and regulation, considering the amount of the budget spent. The Committee had dealt with the regulation in 2013 and then tabled it in July 2013, but it had taken effect only on 19 February 2014.   What was the reason for the Department taking so long to effect the regulation? The Department needed to start taking the Committee seriously, as the Members were the ones who faced the military veterans on a daily basis. If the country was proud of the people that had fought for the country and the democracy we still continue to enjoy, then they needed to be respected, honoured and empowered, and the Department was failing in this regard.

Mr Esau said military veterans had been complaining that it was only the few “connected” that were able to enjoy the benefits of being military veterans. This gave a wrong impression that the Department was dealing with privileged, elitist groups. The Department needed to have one national database for military veterans, as there were currently five databases. As long as some of the military veterans were deprived of access to their benefits, then justice was denied and opportunities are denied. The Deputy Minister of the Department, Mr Kebby Maphatsoe, had made a commitment that the database of the military veterans would be up-to-date and finished by 31 December 2014, and this promise had not materialised. The Minister of the Department, Ms Nosiviwe-Mapisa Nqakula, had also promised that 60% of the data would be completed in six months, but this was just a wishful thinking and the Committee needed to know whether there had been any efforts to create a consolidated database.

The Committee needed to be updated on the forensic investigations, and the DG had been appointed specifically to oversee the implementation of the forensic report, but the Committee had not heard a single outcome or single impact of that report. The Department also needed to tell the Committee about progress in the forensic report regarding any staff that had been disciplined, dismissed or given a verbally or written warning.

It was impossible to call for a one-stop shop if there was a lack of capacity and competent staff to manage the MOUs. Would money be transferred directly to the National Student Financial Aid Scheme (NSFAS)? It was problematic that money was transferred to the departments, but the Annual Report presented stated that no money was transferred to the departments. It was worrisome that the Senior Management Service (SMS) of the Department did not sign the declaration of interests. Generally speaking, the report by the Department was riddled with discrepancies in terms of numbers and typing errors.  

Mr Esau pointed out that if there was no proper Information Communication Technology (ICT) in place and the IT was not functioning properly, it meant the information flows became problematic and this had to be a key priority for the Department to deal with. The Annual Report claimed that there was not one complaint from the military veterans to the call centres. However, he had met a number of military veterans who were in dire situations, complaining and seeking help from him, and the Department needs to “come to the party” to address this issue adequately. The military veterans were still suffering in hospitals without basic health care, and this was an embarrassment to the Department.

He asked whether it was possible to get more information regarding the unemployment database, and whether it was getting any media exposure. Would the Department assist the veterans in writing up curriculum vitaes (CVs) so as to secure job opportunities? It was important for the Department to fight the exploitation of the military veterans, as they are often used for fronting in some companies to secure tenders. Who were the people that benefited from the procurement process?  

The Chairperson interjected, and said the concerns and questions raised by the Members were generally similar and pointed to the issues of leadership, turnaround strategy and accountability. The Department could respond to some of the questions in writing so that they could be circulated to the Members.     

Mr Motumi responded that the way the Annual Report was formatted in a way to show the partially achieved targets and the partially achieved targets speaks to the fact that the target was achieved but not 100% because of challenges. The department will write to the Committee with proposals regarding the issue of the dependence on line function and the proposed changes to legislation and once this had passed the tabling and approval by the Minster then it can be brought to Parliament. The department was still battling with the capacity to enforce the MOUs despite the clause in the Act which obligates all the State-Owned Entities (SOEs) to collaborate with the departments. There was   a turnaround strategy to stabilise the situation in the department and this will also be provided to the Committee in detailed. The department had already transferred money to NSFAS to assist the students of Military Veterans and the Committee will be provided with exact figures of students who had been assisted for the 2013/14 financial year. There were conditions that were introduced to senior officials who were placed on a special leave and this was   also detailed in the report to be provided to the Members.    

Mr Motumi responded that the Department was currently addressing the issue of the CFO who had been put on a special leave, and the disciplinary process was under way. In order to close this gap, there was a senior official who had been appointed in the capacity of the CFO. The absence of the CFO for the better part of the audit period, as well as other senior officials, all contributed to the disclaimer audit opinion. The Department now had provincial coordinators in order to address the complaints of military veterans, but there was still a challenge in terms of the availability of office space, and he was still engaging with the DPW on this issue.

The 52 additional staff were involved mostly at the help desks that had been established, data capturing and the registration process. The Department was still awaiting final Treasury approval regarding the remuneration and rates for the Advisory Council for Military Veterans. The Department had transferred funds to the State Information Technology Agency (SITA) for installation of the ICT systems and within this, to have a linkage to the provinces. However, the Department was still battling with the challenge of a lack of fixed domain in the provinces.

Mr Esau said the responses provided by the Department were insufficient, considering the number of serious concerns that had been raised by the Members. He wanted to know where the additional 52 staff would be placed, considering the Department had nine provincial offices and only four offices had been added.  

The Chairperson once again suggested that such a response could be provided in writing and combined with other questions raised.

Mr M Mncwango (IFP) agreed with the suggestion that questions asked by the Members warranted a comprehensive written response.

Mr Esau asked whether it was possible for the Committee to decide on the deadline by which the Department should provide the responses. He said that if the Committee did not get the written responses within ten days, then he would take it upon himself to demand those responses from the Department, as this was serious matter that demanded urgent consideration.

Mr D Maynier (DA) wondered whether, out of the total number of bursaries dispersed to the deployments of Military Veterans, what proportion was not dispersed to the payment of military veterans from uMkhonto weSizwe (MK).                

The Chairperson assured the Members that he would make a follow-up in order to get the responses from the Department. He suggested that the Department, together with the Committee, should do a road show to interact with military veterans. The Department also needed to use its ICT system as this was a key area that was critically important for any organisation.     

Department of Military Veterans on its Second Quarterly Performance Report

Mr Motumi indicated that the Department had committed itself to 21 performance indicators during the quarter under review, and14 targets had been achieved. As at 30 September 2014, the Department had spent 17% of its budget. This constituted an amount R88 million. The department had targeted to give 1 000 decent houses per year to deserving military veterans and by the second quarter there were still no houses built.

In terms of provision of immediate social relief of distress to the most vulnerable of the military veterans, and acknowledging the reality that there were destitute military veterans, there was   a need to identify those that resided within this category and devise interventions to deliver immediate relief. The financial year would see endeavours to provide the deserving members with hope. Progress to date showed that the Department had submitted its draft 2013/14 annual report to AGSA, and the development and submission of is fourth quarter report to the office of the DG for the Acting DG’s approval, so that it could be submitted to National Treasury (NT), the Department of Monitoring and Evaluation (DPME) and the AG. 693 military veterans had since been enabled to access social relief of distress in the 1st quarter of 2014/15 through the Department of Social Development’s (DSD’s) South African Social Security Agency (SASSA) programme for such support.

The Department had prioritised on providing, subject to availability of resources, comprehensive support services to military veterans and, where applicable, to their dependants, but not limited to acquiring a health care and wellness centre, access to health support and honouring and memorialising military veterans. The veterans were to be supported with quality education, training and skills development, facilitation of employment placement and advice on business opportunities. The progress so far showed that 4 690 military veterans had been provided with health care support and there was a report on the status of the memorial sites that had been compiled.

In terms of education and training skills, about 645 bursaries had been provided to military veterans’ dependents and 604 military veterans had been trained in sewing, welding, driving and the solar geyser training project, sponsored by the Energy Skills Education Training Authorities (SETA), through a private company. 455 had been placed in construction and maintenance with the Department of Water Affairs in Mpumalanga, and those that were work-shopped at the Agricultural Research Council (ARC) had fixed term contracts. The Department was currently in the process of developing a database of all existing memorial sites around the country. Military veterans would be provided with short term contracts to go out and do research and capture data to this effect.

In the empowerment programmes for military veterans, the fiscal year would be characterised by initiatives that would be pursued aggressively to embrace the widening of access to economic participation for military veterans. The initiatives would entail utilisation of preferential procurement mechanisms with the DMV and other social partners, and the operationalization of the Special Purpose Vehicle (SPV) to provide incubator programmes designated for Military Veterans.   A draft proposal for a functional SPV had been presented for consideration by the DMV. The Department had prioritised the empowerment of military veterans to enhance their contribution to reconciliation and nation building, and programmes to enhance their participation in the nation's economic mainstream would be implemented. To this end, programmes would be negotiated for the inclusion of military veterans in the government's socio-economic development programmes which include, but are not limited to, rural and infrastructure development programmes.

A high impact communication and marketing strategy and plan included profiling the image of military veterans and communicating developments regarding delivery in terms of the Military Veterans Act 18 of 2011. Events management involved the co-launch of the Water Affairs project, the military veterans’ digitisation project, the launch of the call centre, maintenance of the website, and promotion of DMV programmes through social media and media relations.

The Department had obtained a disclaimer audit opinion in Quarter 2 and there had been development of an implementation plan to ensure that it addressed the audit findings.

The quarterly performance summary on empowerment and stakeholder relations showed the Department planned to achieve five performance targets during the second quarter, and three were achieved. This constituted a 60% achievement, which indicated that the actual achievements were measuring up to acceptable performance standards.

The department had an annual budget of R504 million. The actual expenditure was R88 million (17,5%) and the available budget was R416 million.  

Department of Military Veterans on its Third Quarterly Performance Report

Mr Motumi said that the Department had committed itself to 19 performance indicators during the quarter under review, and eight were achieved. By 31 December 2014, the Department had spent 36% of its budget, which amounted to R180 million.

The department had a target of 1 000 decent houses for military veterans, but still no houses had been built in Q3. There had been a target of 2 500 deserving military veterans to gain access to relevant training and skills development per year, but there had been zero achievement. A communication and advocacy strategy had been developed, to encourage veterans and their dependents from around the country to register for skills training programmes.

The Department had prioritised on ensuring a fully functional DMV with an independent vote, systems and processes. Progress to date was the development and submission of the Q2 report to the ODG for the ADG’s approval so that it could be submitted to NT, the DPME and the AG. Inputs from NT, the DPME and the AG had been incorporated into the annual performance plan (APP). The second draft APP had been submitted to management for comments.

About 6 539 military veterans had been provided with health care support, and honouring and memorialisation had been done at the 50th commemoration of the execution of the first MK cadres, Mini, Khayingo and Mkaba. There was also a 25th commemoration of the Anniversary of the slaying of Mr. Anton Fransch in a battle with apartheid police in Athlone in 1989. 645 bursaries were provided to military veterans’ dependants.

The promotion of military veterans' heritage, as well as memorialisation and honouring, included interventions to recognise and appreciate the contributions of unsung heroes and heroines of South Africa’s democracy, and would include the establishment of the “tomb of the unknown soldier” as part of the restoration of graves of liberation war military veterans “in and outside the Republic”.

The total budget for the department was R504 million and the actual expenditure was R180 million. This left a remaining budget of R324 million, and the actual percentage spent was currently at 36%.

In conclusion, it was   imperative to highlight that successful implementation was reliant on a common and shared vision, team work and the appreciation of the strategic role and importance of communication in enhancing service delivery.

Discussion

Mr Esau again reiterated the point that there were problems of inconsistencies in numbers and typing errors for both of the quarterly reports provided by the Department and this raised a serious question about the reliability of the financial statement. He wanted to know the reason there was no mention of compliance in the establishment and the EE within the Department. It was still evident in both quarters that that most of the targets were not being achieved and this once again highlighted the issue of lack of management and staff competence.                                                            

Mr Esau remarked that the DMV needed to “up its game” in order to drastically improve the current situation. The reporting needed to happen more regularly in order for the problems to be addressed before the AG’s report.   Why had the information on the suspended accounts been omitted? What were the implications of the suspended accounts? What was the nature of the military veterans getting involved in the mining and energy sectors?  

Mr Motumi indicated that Department would submit all the responses in writing with respect to the annual report and both quarterly reports. The written responses would be provided to the Members by the latest on Tuesday 3 March 2015.

The Chairperson indicated that such a date would suffice, as the Committee had to adopt the report on Wednesday. The Committee was still expected to make some recommendations to the National Assembly (NA) regarding the Department. He hoped that the Department would have a turnaround plan, as the current situation was dire, and the harsh comments and questions by the Members were not meant to demoralise the Department, but to suggest some improvements.  

The meeting was adjourned.