Department of International Relations & Cooperation & African Renaissance Fund 2016 Annual Performance Plans

Meeting report

Department of International Relations and Cooperation: Briefing

Ambassador Jerry Matjila, Director General, Department of International Relations and Cooperation (DIRCO), said that the Department was currently focusing on sustaining economic and political relations with other countries, taking part in global governance forums and realising Agenda 2023.

There had been an increasing number of bodies of the United Nations in South Africa. The world was currently facing a number of challenges such as the rise of terrorism, slow economic growth, currency fluctuation and low oil prices, shifts in political ideological implications and new trends in trade and economic patterns. However, even in the face of the aforementioned, South Africa was making its global footprint known with a presence in 125 countries across the world.

South Africa’s influence in the global political economy had the capability to better the lives of the poor due to the increase of tourism. There was a big demand for people to come to South Africa and this was good because it showed that the world had confidence in South Africa. With the Design Indaba fast approaching, South Africa needed to ensure that tourists who came for this event not only stopped in KwaZulu-Natal, but also explored other parts of the country.

The Director General spoke about the importance of Afrocentric relations and emphasised that there had to be a change in the ‘normalised’ cross-Atlantic relations. To consolidate the African Agenda, DIRCO would promote human rights, peace and security and good governance in the African continent through participating in continental forums that pursued these objectives.

All nations of the world were competing for attention, so public diplomacy was important. There were many South Africans living abroad and they still considered themselves as South African. He urged the Committee to rethink how the narrative had been shaped around people leaving the country, saying that in Dubai there were 32 000 South Africans living there and that impacted positively on the South African brand, especially when these people were representing the country well.

Ms Hlengiwe Bhengu, Chief Director: Financial, outlined the Department’s medium term expenditure framework (MTEF) allocation. On the issue of ‘’shifting resources away from less urgent priorities or non-performing programmes’’, she said that DIRCO did not have non-performing programmes, but due to constraints in the budget, a shift would still be done based on performance and demand. The Department’s challenges and threats were budget cuts, the baseline reduction, cash management and cash liquidity. These affected spending at DIRCO and had limitations to the execution of some its missions. The root causes of these challenges were foreign exchange fluctuations and some unfunded priorities. The implications were the under-achievement of some targets as set out in the annual performance plan (APP) and the Department operating on an overdrawn account.

The allocated budget for 2016/ 2017 was R5.890 bn, R5.913 bn for 2017/2018 and R6.183 bn for 2018/2019. To have a cost effective budget, the Department had partnered with the Department of Home Affairs (DHA). The DHA would allocate funds for DIRCO for the money the Department used to assist people with Home Affairs’ issues, particularly overseas. These included South Africans who had lost their passports abroad and thus had to get new ones at a South African embassy or consulate abroad. There were other costs that DIRCO had to pay, such as lease payments for missions, information technology (IT) payments, transfer costs and insurance and municipal charges for diplomatic missions in South Africa. These expenses were costly and they were some of the reasons why DIRCO had had to review its budgets.

Ms Bhengu spoke about how the Department planned to increase its operational budget. Some of the measures to realise this included reducing operating leases abroad by using the land given to DIRCO to build property, and cutting down on rental costs. DIRCO owned land abroad and currently it was developing three sites in Lilongwe and was looking to build in Rwanda also. Instead of DIRCO being responsible for insurance and transfer costs for officials, they were looking to have a third party being responsible for this, as it would significantly cut down on costs.

Linking this to her earlier remarks, she mentioned that there were unfunded mandates in the Department, These included the cost of living adjustment, the African Union (AU) assessment -- DIRCO was still engaging with Treasury on this matter -- the ICT back office refresh and the full funding of the new structure.

Discussion

Mr S Mokgalapa (DA) said that even though the Committee ‘missed’ the Minister as the political principal, the Committee appreciated the work done by the Deputy Minister. He asked about the review and the rationalisation of the missions. He said that the current climate allowed for it. The world did not look at South Africa based on its global footprint and the number of missions the country had, but rather assessed the country on its impact. Thus, DIRCO needed to have a political review of the impact of its missions. In addition, DIRCO could make an impact based on quality and not quantity.

He asked what the Director General meant by ‘national priorities and national interests’, and whether he could differentiate the two for him. On the issue of the partnership between the Department of Home Affairs and DIRCO, he said that the DHA was ‘playing ball’ by sharing costs. He asked if something similar was in the pipelines between DIRCO and the Department of Trade and Industry and the Department of Defence.

On the point mentioned by the Director General about South Africa being in demand for tourism, he asked why there was this demand. Why people wanted to visit South Africa should be evaluated, as the reasons were many. It could be that currently the rand was weak in comparison to the dollar and Euro, and not necessarily that the country was in demand. Lastly, he asked about DIRCO’s audit outcomes and how they had been conducted.

Mr M Maila (ANC) said that he agreed with Mr Mokgalapa about the rationalising of missions. He asked if South Africa would continue with the Pan African Parliament (PAP) or not. He asked how DIRCO managed state security, especially with the large number of people coming into the country frequently.

Mr D Bergman (DA) referred to page 4 of the presentation, and asked in whose eyes and whose judgment was South Africa calling itself respected and responsible. He asked what protection there was to deal with the rand/dollar fluctuation. He agreed that South Africa should promote tourism, but it should not burden the country’s infrastructure. He was in favour of trade seminars, but how would they be executed to ensure that the infrastructure had the capacity to carry a lot of people. He asked what South Africa’s top five memberships were.

Ms D Raphuti (ANC) referred to Programme One of the DIRCO presentation, and asked if the Department had done thorough consultations with reductions. Were there plans for effective management on Programme Two? What were missions doing to bring development in South Africa? South Africa was like ‘honey’ because it attracted people, and the country should ensure global governance, especially on the African continent. South Africa had to make it a priority to be a model for other African states.

Ms T Kenye (ANC) pointed to the presentation’s reference to the rise of terrorism. She asked if there had been an agreement signed after the Syrian attacks. She asked what could be the solutions for terrorism and the currency fluctuations. Had DIRCO identified any priority projects? She asked how the transfer of funds between the DHA and DIRCO was carried out.

The Chairperson said that DIRCO should give the Committee a list of its embassies and missions abroad, what they had done and planned on doing. He said that there were a lot of business people, especially whites, who said that it was good to be a South African and one needed to ask oneself why. He asked about the dangers of religious fundamentalism, using ISIS and Boko Haram as examples. Was South Africa taking sides or was it neutral regarding ISIS. He referred to the statelessness of people emerging in the world, and asked how DIRCO dealt with such cases. How was monitoring executed, especially abroad?

On the question of public diplomacy, the Chairperson asked if the DIRCO’s Ubuntu magazine was published only in English, or if it was translated into other languages as well. He asked for clarity on the unfunded mandates, saying that this had not been described well in the presentation.

Mr Maila asked if the bill mentioned on page two was new bill or an already existing bill. He asked which property was being referred to on page 22. On the issue of insurance and transfers, asked if the cars spoken about were for officials or for people on missions.

Ms Raphuti asked who conducted research and who drafted research papers for the Department.

Ms Kenye asked who paid people sent by their countries for missions in South Africa. Was it DIRCO that funded these international missions, or the country the people represented? She asked who owned the land that had been spoken about in the presentation.

Mr L Mpumlwana (ANC) asked what the attitudes of the United States of America and Europe were towards the BRICS Alliance, since the alliance was seen to conflict ideologically with the mandates of the International Monetary Fund (IMF).

The Chairperson expressed his views on the question of the Pan African Parliament. He said that the same way that the USA would not let go of the United Nations, South Africa should not let go of the Pan African Parliament. He asked if DIRCO could carry out its mandates.

The Deputy Minister responded that DIRCO could carry out its mandates despite the challenges that it faced. He said that he had a flight to catch and thus the questions would be answered by his delegation.

Mr Kgabo Mahoai, Deputy Director, DIRCO, answered the question about monitoring, and said that the Department was trying to monitor and assess which posts to keep and which ones to freeze. He said that implementation of the structure was taking place this financial year.

Ms Bhengu said that the land that she was speaking about was in Botswana, Mali, Rwanda, Saudi Arabia, South Sudan, Tanzania and India. On the issue of insurance, the vehicles belonged to officials sent abroad to do work for the Department. There was land available for DIRCO in Pretoria, Centurion, to build an office for the Pan African Parliament. The top five memberships of South Africa in no particular order were the Southern African Development Community (SADC), the AU, the New Partnership for Africa’s Development (NEPAD), the UN, and the International Political Science Association (IPSA).

DIRCO had identified South African missions abroad that were struggling and senior members had been sent to monitor them. There was a new system of electronic monitoring that was being developed that would save the Department money, as officials would not have to travel for monitoring purposes. DIRCO had had a meeting with Treasury to discuss the performance of the rand.

Mr Labone Gideon, Chief Audit Executive, DIRCO, said that there had been a robust assessment in auditing both the headquarters of the Department in Pretoria and abroad. There was no impact on budget costs when DIRCO undertook audits because auditing was on the budget.

Ambassador Matjila said that ‘national interest’ contributed to a better world, and it changed all the time. However right now, it was based on inclusion. There was a regular review at DIRCO about its role and its global presence. Even though infrastructure was an issue, there was capacity to host the trade summit. He said that South Africa had a lot to sell and if it worked well, its tourism industry would blossom in the coming years,.

He said the question of religious fundamentalism taught South Africa to take seriously the issue of inclusivity, because if this does not happen, everyone would ‘perish’. The Belgian attacks should be a wake-up call to South Africa, and people should realise that fundamentalism was not only caused by religion. Everyone should take seriously South Africa’s call for non-racism, multi-culturalism and the sharing of resources because if that did not happen, people would feel excluded and everyone would pay the price.

DIRCO knew that South Africa was respected globally, because South African officials were constantly asked to co-chair global events and initiatives. DIRCO had very skilful diplomats and the quality of leaders South Africa had produced had earned the country respect. He closed by saying that the UN’s rigidity had to change, and that small and previously marginalised countries had to be included more in the UN.

Ms Delores Kotze, Chief Director: Planning and Strategy, DIRCO, said the Department had a research unit which published the ‘Ubuntu’ magazine. She said that the publication was not only in English, and if there was a demand for it to be translated, this could be done.

The Chairperson asked who the land in Pretoria for the PAP offices belonged to. If anything should go wrong with this land issue, who was accountable between the Department of Public Works and DIRCO?

Ms Bhengu said that the property for the PAP office space was owned by the South African government. It had been given to DIRCO in 1994, and during all these years there had been on-going assessments concerning its occupation or disposal.

Briefing by African Renaissance and International Cooperation Fund

Ms Dineo Mathlako, Head: African Renaissance Fund (ARF) Secretariat, DIRCO, said the Fund had been established in terms of the Section 2 (1) of the African Renaissance and International Co-operation Fund Act of 2000 (Act No.51 of 2000). For the Fund to be utilised, the Minister of DIRCO, together with the Minister of Finance, must set up an Advisory Committee consisting of specific members as outlined in page 38 of the presentation.

She said that the fund had a mandate to ensure good governance and democracy, support the economic development of other African states and the diaspora, contribute to human resource development, provide disaster relief and humanitarian assistance, contribute to Post Conflict Resolution and Development (PCRD) and ensure cooperation between South Africa and other countries. She said that ARF was in the process of finalising institutional arrangements with National Treasury.

Discussion

The Chairperson asked what was delaying the African Renaissance and International Cooperation Fund from moving from a fund to an agency. How did the Department ensure that its funds were used for what they had been initially allocated for, and not for other expenses? Was the money in the fund being used for what it was meant for?

Ms Raphuti asked how DIRCO marketed the African Renaissance and International Cooperation Fund, and which countries had been assisted by it.

Ms Kenye asked what had happened to the organogram, and whether or not it was the same between the ARF and the DIRCO in its entirety. She referred to the R1.759 bn surplus in the fund, and asked if the roll-over did not create problems with accountability.

Mr Mpumlwana (ANC) asked what implications the reduction in appropriated funds had for the ARF.

Ms Mathlako responded that there were implications, but the Department was working around them. She said that there was no automatic roll-over of the mandate, as each roll-over had to go through the Minister first. The Department did not market the fund. Instead, requests for funds went through the government which then directed the relevant or source country that wanted funding, to the ARF.

Cuba was the only country that had been assisted by the ARF. ARF did not have a uniform funding approach. To illustrate this, she said that Cuba had needed money to develop its economy and its environmental affairs. Instead of the ARF giving Cuba money, it had asked what Cuba needed specifically, and Cuba had indicated it needed seeds. The ARF had thus bought seeds that were of equivalent value to the money requested, and had sent them to Cuba.

She said the fund was meant to be a driving force for the agency, and even though it was modelled on other global agencies, it had been modified to serve specifically the needs of the country, the continent and the diaspora.

The meeting was adjourned.