The Auditor General South Africa (AGSA) briefed the Committee on the preliminary review that it had done into the draft Annual Performance Plan of the Department of Arts and Culture (DAC). It was noted that as part of its oversight, the Committee must examine the action plans and the importance of those being quantifiable, able to be compared with other documents and able to answer questions as to how long and at what cost the plans would take to fulfil, was stressed. The AGSA had not only reviewed the content of the Annual Performance Plan (draft and final versions) but also looked at how well it aligned with other documents, to assist the Committee with its own oversight, by directing its attention to specific points. The AGSA explained the distinction between this preliminary review of the Annual Performance Plan, which was done looking forward into the financial year, and the audit that would be done looking retrospectively at the last financial year. It was stressed that the AGSA looked at the usefulness and the reliability of information, and each of these was explored in more depth. The usefulness related to how the Annual Performance Plan was in alignment with the Medium Term Strategic Framework, and how it was to be applied. Reliability would look to the credibility of the information. The main criteria in reviewing involved looking at the measurability, relevance, time-frames and matching of targets to the mandate of the DAC.
AGSA had chosen to review Programmes 3: Arts and Culture Promotion and Development, and Programme 4: Heritage Promotion and Preservation; it was explained later, during the questions, that these programme were where the core programmes that related directly to service delivery were situated. The review was done on the second draft Annual Performance Plan submitted to AGSA on 2 December 2015, but a comparison was also done to the final version of 26 February 2016. A summary was given of key indicators, but it was also noted that some of the problems and mis-matches had been refined in the final Annual Performance Plan. In Programme 3, 6 of the 27 indicators were not well defined, and the same pertained to 10 out of the 29 indicators for Programme 4. Targets that were not specific were also highlighted in each of the programmes. Some targets were not measurable. Finally discrepancies between the annual and quarterly targets were highlighted. AGSA then elaborated by giving examples of each of these issues, and explained that whilst DAC sometimes named a figure, it did not define how it would get to that figure, or what exactly the programme would be to reach the target. Some of the representative examples related to distribution of flags, placing artists in schools, and estimates only for accepted file plans and programmes with local content, as well as the statement that one arts centre would be erected, but without naming where it was to be done, and how each of the quarterly targets was fed by plans of work to be done in that quarter.
Members were pleased in general with the approach that AGSA had taken to have a more proactive stance. However, some Members were worried as to why Programmes 3 and 4 were chosen, pointing out that these were the programmes reviewed also in the previous year. They noted that much of the information appeared to be the same as presented previously, which raised concerns as to whether issues were actually being addressed by the DAC. The Committee had noted repeat findings in the audit reports also. They queried who received the information and whether feedback was sought from management. They wondered why the AGSA had not seen fit to review the programme that involved administration and finance, particularly since it was in these respects that some of the entities were experiencing particular problems. They wondered if some of the examples cited did not merely indicate poor administration overall. They were particularly concerned about the failure to even name where the building would be erected, and asked if technology could not be used to assist in making the plans more measurable. AGSA noted the concerns, but wanted to emphasise that time for this review was tight. The Committee noted that it would be holding discussions with DAC in the forthcoming weeks and these discussions had helped the Committee to focus on particular areas.
Department Arts & Culture 2016/17 Annual Performance Plan: Auditor General South Africa (AGSA) briefing
Mr Musa Hlongwa, Business Executive: Auditor-General South Africa, noted that this briefing would not comment on any audit of the Department of Arts and Culture (DAC or the Department) but the purpose was rather to supply some insights on the interim review of the Department of Arts and Culture draft Annual Performance Plan (APP), in order to add value to oversight. When the AGSA reviewed information, it focused on the usefulness and reliability of that information. “Usefulness” involved looking at compliance of the APP with the medium term strategic framework (MTSF) - in other words, did these two documents align properly with each other and were they applied as they should. “Reliability” meant that AGSA would review the information itself and its credibility, by looking to the supporting documentation. He reiterated that this was not actually an audit, for that would have required AGSA to look into what had happened in the past financial year, but this presentation would be looking forward to the probable review in the coming financial year.
Mr Hlongwa noted that his presentation would merely highlight points that the Committee might wish to review. He would, for instance, comment on whether the APP aligned with the MTSF, whether the indicators were relevant and complete, and whether there was a logical plan/link between objectives, indicators and targets. That would involve an assessment of how the APP could be achieved and whether the targets were realistic. He would also speak to whether the APP complied with the SMART principles of being specific; measurable; achievable; relevant and time-bound, all of which were the framework required by National Treasury. Further questions related to whether adequate resources, both human and financial, were made available to achieve the APP, for it should not be hypothetical but based on practicality. The AGSA was looking at whether the APP could be achieved, but by means of performance contracts and monitoring, and whether areas for achievement are included in the performance contracts of the management team, to ensure its efficacy. He recommended that there should be quarterly evaluations of progress against APP targets, to evaluation on an ongoing basis the extent of what the DAC was accomplishing. This would run alongside, not replace, the review of annual achievements against APP targets as well. An additional consideration would be the review and tracking of changes to strategic plans and annual performance reports, and evaluation on whether any changes were an improvement to the targets.
Given the limited time, the AGSA assessed the measurability and relevance of the final draft indicators and targets planned for selected programmes. The findings of the AGSA from the review were communicated in the 2015-16 interim management reports, to enable changes to be made. The findings that were relevant to the interim review have not had any impact on the audit conclusion for the 2015-16 year end audit, for this was a pre-audit study, and was self-contained.
Ms Pulane Maare, Manager: Auditor-General South Africa, explained that the criteria used to assess the draft APP were primarily the measurability of indicators and targets, and the relevance of indicators and targets. The measurability would look to whether the indicators were well defined, clear and unambiguous. Measurability said the indicators must be verifiable, and targets should be specific, measurable and time-bound, so that it would be known by when they were to be achieved. Relevance would tie back to the mandate, vision and mission of the Department.
Ms Maare highlighted that the AGSA had chosen programmes 3 (Arts and Culture Promotion and Development) and 4 (Heritage Promotion and Preservation) for review. There was no problem with relevance in either. However, measurability of the indicators and targets was seen as a problem.
The review by AGSA was based on the second draft APP issued to the auditors on 2 December 2015, and this was compared to the final version of the APP submitted on 26 February 2016. The DAC had cooperated well with AGSA.
Ms Maare noted that the following summarised issues seen, which had since been resolved: - Within programme three, six out of a total of twenty-seven indicators were not well defined.
- The six indicators not well defined were then corrected within the APP of 26 February 2016
- Programme 4 had a total of twenty nine indicators for the APP, of which ten indicators were initially not well- defined, but which had been corrected also
- The ten corrected indicators comprised 35% of the APP.
The report also highlighted targets that were not specific. For Programme 3, 14 out of its total of 27 indicators were not specific – or 51% of its indicators for the APPs, which were resolved within the 26 February draft. For Programme 4, six out of 29 indicators were not specific – which represented 21% of of the total number of indicators. That was also resolved in the final APP of 26 February.
The summary of key findings had highlighted targets that were not measurable. Programme 3 had just one target out of the 27 indicators that was not measurable, or 4%, and this was corrected in the 26 February plan. Programme 4 had three targets out of 27 that were initially not measurable, which was 10% of indicators, but these too were corrected in the plan of 26 February.
Lastly, discrepancies between the annual and quarterly targets were highlighted within the summary of key findings as an issue. Ms Maare said that sometimes an annual report would note a target of ten, but the quarterly reports would then repeat that same target of ten in every quarter, instead of breaking it down.
Ms Maare then elaborated on examples of indicators not well defined. For instance, the indicator detail of the number of hand-held flags distribution was targeted at a total of 10 000 flags, but the technical indicator description (TID) of the indicator had omitted how and where those flags would be distributed. When background enquiries were conducted, the AGSA received lists of limitations, such as what might happen to overnight requests. AGSA therefore wanted the APP to quantify the target, for instance by describing whether the flags would be distributed on National Days, at Ministerial imbizos or upon request from other governmental departments. Although there was a number, it was not specified how this would be achieved.
Her second example related to the number of artists placed in schools, and the number of schools where the Artists in Schools (AiS) programme was to be implemented. The target was 340 artists in schools, but the TID did not specify their role and purpose in the school setting. The DAC was asked to enumerate whether they were supposed to provide support to the schools’ educators, provide extra-mural activities, or even whether the artists were meant to teach Arts and Culture related subjects.
The third issue related to targets not specific and measurable. The example was that the percentage of accepted file plans evaluated was estimated at fifty-six or 100%. However, this was an estimate, and was not specific and measurable, and it was also not specified how the required performance would be calculated to achieve the 100%. Another indicator detail with a target that was unspecified and not measurable was the number of programmes supported to support local content. The target was only one new community arts centre initiated, but the technical indicator description (TID) had not even given the location of the probable site. AGSA was not overly technical and insisting upon a name or specific details, but did want to know, at least, the area in which it would be built. Additionally, the quarterly targets for the new community arts centre were enumerated at 20%, 40%, 60% and 80%, but again, there was no clarity on how the target would be achieved.
The Chairperson thanked the representatives of the AGSA, and noted that for the Committee, correct oversight would mean asking the right questions. The SMART principles should be embedded in the work of the Committee. The Committee also needed to measure the workload of the Department, and in order to do that, the work must be quantified so that there could be oversight. The DAC therefore did need to expand on the targets to explain how it intended to do the work.
The Chairperson appreciated AGSA's proactive approach in scrutinising the APP. This had affirmed the need for the Committee also to be proactive in its approach with the Department and further identify any discrepancies, so that the Department could achieve its goals more effectively.
Mr G Grootboom (DA) stated that the AGSA report had honed in on a few very obvious issues in the Department. The Generally Recognised Accounting Practices (GRAP) did pose some challenges and he wondered why the AGSA had not looked at those.
Mr Zipho Mdluli, Senior Manager: Auditor-General South Africa, replied that the GRAP was applicable to a public entity and not to the DAC as a whole, so that this explained why AGSA had not focused on that at this point.
Ms V Mogotsi (ANC) wanted clarity regarding the sampling used, mentioning that the same sampling was applied as in the previous year: Programme 1 related to Administration and Programme 2 to Institutional Governance. The Committee was aware of some entities in the Department having issues within Programme 1, and she further pointed out that Programme 1 covered financial matters, which she would have thought it important to review. She asked whether the fact that the AGSA did not look at this implied that the issues had been resolved, and asked why AGSA had chosen, again, to look at Programmes 3 and 4. She thought that the DAC was not doing too well on expenditure either. She wondered if some of the concerns that AGSA had raised, including the mis-distribution of the flags, community arts centre not named and uncertainty about the role of the artists, did not in fact all relate back to poor administration in Programme 1. She was not happy, overall, with the way the sampling had worked.
Mr J Mahlangu (ANC) asked whether AGSA could comment upon the quality of the work of the DAC in relation to the APPs in the sampled years, and whether it was showing improvement or regression .He also said that the summary of the findings had mentioned issues that were not clearly defined, although it did also note that these had been corrected when the final APP was submitted. The Committee would be evaluating these also and it would be crucial to get detailed and accurate information from the Department and its entities. The review by AGSA seemed to suggest that the DAC had not in fact done what was expected, and he could foresee some difficulties with conducting oversight.
He also noted the sampling in the previous year on one or two of the entities, and that had been useful as it had enabled the Committee to do better scrutiny in this year. He agreed that if it was intended to set up a community centre it would be crucial to know exactly where it was to be, rather than merely a theory. He said that electronic oversight had been requested in Parliament, and he could foresee that technology should surely be able to give better coordinates, so that it was known exactly what was to be seen as part of the oversight.
Mr Hlongwa repeated that the purpose of the briefing, as set out on page 3 of the attached document, was to provide audit insights on the interim review of the Department’s draft APP. This had been merely a draft plan, and the AGSA's role was one of looking forward. The time that AGSA had to conduct this pre-audit exercise had been very limited, and it was for that reason that only certain areas had been chosen to focus upon – including the usefulness of information. AGSA had also wanted to review January plans, but there was insufficient time to do so before this briefing. It had based its selection of programmes on those that were more material to the actual work and service delivery of the Department.
Mr Mdluli answered that the questions posed were similar in nature to those in the previous year, which included questions around how far scrutiny could go. Most of the funding had usually been spent on the sampling itself, of over 45%. The results of Programme 1 were usually the most indicative, and so the majority of funds would be embedded within that programme. Mr Mdluli acknowledged that the grievances cited by the Committee of Arts and Culture had been noted. Yet, it is to be remembered the concerns abut this programme, but repeated that the core work of the DAC was in fact carried out through Programmes 3 and 4. In relation to the quality of the APPs, he thought that the quality may have been impeded by the fact that there was a change in format. In the previous year, there was a longer report and there had also been particular issues, such as the artists in schools and flag distribution. Although these may be addressed, there would also be ongoing and ever-repeating hurdles around shortage of time and the on-going requirement of newer and multiple versions of content. As the AGSA was reviewing information, newer versions would be tabled and time would be taken appropriating these.
Ms Mogotsi asked how many management letters were given to the Department and how many of the points raised in these were dealt with.
The Chairperson wanted to know whether the issues were raised to management levels, and, if so, what the response had been.
Mr Hlongwa confirmed that responses had been received on this review.
Mr Mdluli assured the Committee that the issues concerning the Department would be dealt with next year, as part of the background to the audit. Until then, an Action Plan by the DAC in could resolve and further prevent concerns that had been raised in this interim report.
The Chairperson thanked AGSA and emphasised the need to look carefully at all the programmes in the APP, given the tendency of repeated issues; sometimes they seemed to have been resolved in one year but might be raised again in subsequent years. In the following week, the Committee would like to get a report on the recurrent issues, and a quantifiable comparison between issues raised and the reasons why they had been raised, in order to try to bring concerns out into the open and then try to address them. She noted that the DAC had to provide service to the people.
Other Committee business
The Chairperson noted that the Committee programme had changed and called for adoption of the new proposed programme.
Mr Mahlangu (ANC) said that he thought the forthcoming meeting was unnecessarily long.
The Chairperson noted that it was likely that the DAC might not take up the full two hours allocated for the briefing on 12 April 2016, but this was just a guideline. Some of the entities may not need so much time.
Dr P Mulder (FF+) apologised in advance that he might not be able to attend the Thursday 12 April meeting, but hoped to attend the Tuesday meetings.
The Chairperson explained that due to the time constraints in the second term of Parliament, a request was made to have additional meetings as well as the Tuesday regular slots. She requested that if at all possible Dr Mulder should try to re-arrange his schedule to be able to attend on 21 April.
Mr T Makondo (ANC) requested discussion on Nelson Mandela on Thursday 21 April.
The Chairperson said that this would be done, because of concerns about the briefing by the South African Roadies Association.
She noted that the minutes would also be considered on that date.
The meeting was adjourned.
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