2015 Medium Term Budget Policy Statement (MTBPS): Public Service Commission briefing

Standing Committee on Appropriations

02 November 2015
Chairperson: Mr S Mashatile (ANC)
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Meeting Summary

The Public Service Commission (PSC) proposed a strategy for improving management practices in the public service comprising of three elements: professionalising the public service, transforming corporate support practices to focus on outcomes as well as compliance, and improving performance management and accountability structures.

It had identified the country's open system of recruitment as one factor hindering the development of a pool of skilled career public servants. The ratio of corporate support to line functions was also a major contributor to the public service's very large wage bill. Some departments did not implement court awards and ignored judgements, kept suspended staff on full pay for long periods (there was one official in Kwazulu-Natal who had been suspended with pay for twelve years), outsourced work to consultants for which internal capacity was sufficient, and habitually failed to pay invoices within 30 days. With regard to improving performance management, departments needed to drastically improve the quality of the performance indicators in their annual reports and provide longer-term data so that trends could be identified. Performance should be assessed at unit rather than individual level, and failures should have consequences

The Committee discussed the recruitment policies used in the public service, and generally agreed with the PSC that the current “open” system did hinder the development of a pool of skilled career public servants. Other ways of developing appropriately skilled staff were also discussed.  Of major concern to the Committee was the apparent contempt for court decisions with financial implications in many departments, as well as the habitual late payment of service providers, which was especially harmful to small and medium sized enterprises, and the practice of keeping suspended staff on full pay, sometimes for extremely long periods, which was further increasing the public service's already large wage bill. The Committee asked for a thorough investigation into the performance of all government departments, based on the findings presented by the PSC on eleven of them.
 

Meeting report

Public Service Commission: 2015 Medium Term Budget Policy Statement (MTBPS)
Ms Phumelele Nzimande, Commissioner: Monitoring and Evaluation, Public Service Commission (PSC), introduced her delegation before handing over Ms Lulu Sizani, Commissioner: Leadership and Management Practices, to deliver the presentation.

Ms Sizani said that it was not within the PSC's mandate to give an overall assessment of the 2015 Medium Term Budget Policy Statement (MTBPS). The presentation would discuss strategies to improve management practices in the public service instead. In broad outline, the recommended strategy incorporated three elements: professionalising the public service, transforming corporate support practices to focus on outcomes as well as compliance, and improving performance management and accountability structures.

With respect to the professionalisation of the public service, the PSC had published a discussion document on the matter. It had identified the country's open system of recruitment as one factor hindering the development of a pool of skilled career public servants. The ratio of corporate support to line functions was also a major contributor to the public service's very large wage bill. Some departments did not implement court awards and ignored judgements, kept suspended staff on full pay for long periods (there was one official in Kwazulu-Natal who had been suspended with pay for twelve years), outsourced work to consultants for which internal capacity was sufficient, and habitually failed to pay invoices within 30 days.

With regard to the improving performance management, departments needed to drastically improve the quality of the performance indicators in their annual reports and provide longer-term data so that trends could be identified. Performance should be assessed at unit rather than individual level, and failures should have consequences. In the Department of Health, for instance, it had emerged that district managers often lacked belief in their own authority and did not take the necessary disciplinary action in response to poor performance.

Ms Sizani went through the performance of 11 departments which the PSC had investigated, indicating how diligently they had submitted performance agreements and comparing their budget utilisation with their performance. She said that the delivery model in South Africa was too top-down, leading to a duplication of structures across different departments and at different departmental levels (national, provincial, etc), as well as bureaucratic “inflation.” Poor planning was another stumbling block. Strategic and annual performance plans were insufficiently detailed to enable strategic decision-making. The PSC recommended that increasing departments' capacity for financial planning should be a priority.

Discussion
Adv Richard Sizani, Deputy Chairperson, PSC asked if some of the questions could be answered in detail in writing.

Mr A Shaik-Emam (NFP) agreed that the huge gap between spending and performance in many departments was a big problem. He asked whether the PSC's recommendations were being listened to.

Ms Nzimande assured the committee that they were listened to. For example, they had recommended that heads of departments should be given contracts of at least five years, instead of three, for reasons of stability.

Mr Shaik-Emam asked whether the very general problem of poor service delivery was, in the opinion of the PSC, at the provincial rather than the national level of government. It was a concern that Ministers had no say in the appointment of MECs and other senior staff at the provincial level.

Ms Sizani said that this would not be possible at present, because the Public Service Act empowered MECs to appoint their departmental staff. MECs were also not appointed by Ministers.

Mr Shaik-Emam said he was aware of this, but suggested that perhaps it was something that needed to be looked at.

He said that recruitment policies were one of the reasons for the low morale in the police service. Long-serving officers were being passed over for promotion, even when these were mandatory.

Ms Sizani agreed. She said that the open recruitment system was part of the problem here.

Mr M Figg (DA) appreciated the data that the PSC had presented, but was disappointed that only 11 departments had been assessed. The data that had been presented suggested that all the departments needed to be assessed.

Ms S Shope-Sithole (ANC) agreed. She asked for the 11 that had been assessed to be called to present to the Committee.

Mr Kobus van der Merwe, Acting Deputy Director-General: Monitoring and Evaluation, PSC, said that they were increasing their capacity for this sort of analysis. A great deal of work was involved in making sense of the extensive data.

Mr Figg asked about the anti-corruption hotline mentioned in the presentation. How many instances had been reported, and what had been the success rate of actions following from reports to the hotline?

Ms Sizani said that detailed information could be made available in writing. She was able to say that only three provinces (Kwazulu-Natal, Northern Cape and North West Province) had had success rates of below 60%.

Mr Figg did not think that hiring internally was always the best solution to ensure posts were filled with appropriately skilled staff. In addition, if posts were never advertised externally, how would new graduates get the opportunity to enter the public service?

Mr N Gcwabaza (ANC) said that the open policy could not continue. Staff needed to have career experience as well as an academic qualification, but internal career training also needed to be supported. He asked how effective the National School of Government (NSG) and its predecessor, the Public Administration Leadership and Management Academy (PALAMA) had been in professionalising the public service.

Mr Sizani said that the PSC was determined that the NSG should succeed. It was in a transitional stage at present. Having been a department of state, it was to become an institution of higher education, according to the Public Administration and Management Act. He said that the university curricula were not actually preparing students for public service careers. A student could graduate with an LLB, for example, without knowing how to draft legislation or even write a letter of demand. One of the functions of the NSG was to be a bridge across the gap between a theoretical qualification and the practical needs of government.

Mr Figg expressed serious concern about the lack of respect for court decisions, among other things. He asked for more detail, especially on any departments that were repeat offenders. Equally disturbing was the endemic late payment of bills.

Mr Gcwabaza agreed that the issue of departments ignoring court judgments was something that needed an explanation.

Mr A McLoughlin (DA) also found this situation disturbing. It could not be allowed to continue.

Mr Sizani said that the PSC had produced a report on this situation, which he described as tragic. Small, medium and micro enterprises (SMMEs) were especially vulnerable to delays in being paid, which could easily force them into an overdraft situation. The lack of consequences for late payments exacerbated the problem.

Ms Sizani added that the problem also affected the judgments of the Commission for Conciliation, Mediation and Arbitration (CCMA) and the bargaining councils.

Mr Shaik-Emam suggested that they needed to look at the problem at a deeper level, to try and unearth the root causes. He also called for information about repeat offenders.

Mr Figg suggested that the PSC set up a hotline for complaints relating to late payments.

Ms Shope-Sithole said that long-term paid suspensions were unacceptable. Government could not reasonably complain of financial pressure while there were people being paid to sit at home for years on end.

Ms Sizani agreed that the situation was highly problematic. In fact, there was another person who had been on paid suspension for four years, who had been supposed to chair the disciplinary hearing of the one who had been on paid suspension for twelve years!

Mr Shaik-Emam said that strong action was necessary. He suggested that patterns of late and timely payment needed to be investigated, in case any deliberate partiality was displayed toward certain service providers, and corresponding prejudice toward others.

Mr McLoughlin asked whether the PSC worked with National Treasury to reduce the public service wage bill. The ever-increasing wage bill was one of the national budget's most serious challenges.

Mr Sizani said that he sat on the Presidential Remuneration Review Commission, in which the question of the wage bill had been discussed. National Treasury worked with this commission.

Ms Sizani added that the PSC had made two submissions to this commission, firstly on the service conditions of educators, and secondly on the conditions of all public servants.

Mr McLoughlin asked for an explanation of the terms used in the data on the submission of performance agreements. What did “after” and “acting” mean in this context?

Mr Van der Merwe explained that “after” meant that a performance agreement had been submitted only after the deadline.

Mr McLoughlin asked about the extent of the PSC's power to enforce its recommendations. As he understood it, this was limited. If legislation gave them more power to enforce, would they be able to use it?

Mr Sizani explained that there were very few cases in which the PSC's recommendations were not implemented, at both the provincial and national level. They had not, therefore, sought to increase their legal powers. The Constitution did allow them to issue binding directives, especially regarding employment matters.

Mr McLoughlin worried about an unintended consequence of performance being assessed at a unit level. Would it not hinder accountability by allowing for blame-shifting within a unit?

Ms Sizani explained that one of the reasons for unit level performance assessments was to eliminate the practice of paying bonuses to people who may have met their own targets while their unit, or department as a whole, had failed.

The Chairperson thanked the PSC for their presentation.

The Committee then considered some outstanding minutes. The minutes of meetings on the 22, 23, 27, 28 and 30 October 2015 were adopted with minor non-substantive amendments.

The meeting was adjourned.

 

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