Documents handed out:
Department of Military Veterans 2016 Annual Performance Plan [Document not available email firstname.lastname@example.org]
The Department of Military Veterans (DMV) reported on its 2016 annual performance plan. There were eight priorities. These included ensuring a fully functional Department with an independent budget vote and systems, and the provision of immediate social relief and comprehensive support services to Military Veterans (MVs) such as a health care and wellness centre. No progress had been made in accelerating this, and the process was ongoing.
In 2014/15, 6 795 military veterans had been provided with healthcare support, 2 450 had been trained and skilled, 1 696 had accessed jobs. 96 cooperatives had been registered, a draft plan had been developed to provide training in registering cooperatives, and there had been a slow progression towards the finalisation of a memorandum of understanding (MoU) with the Department of Transport. Nine houses belonging to MVs had been rescued from repossession, burial support was provided for 160 beneficiaries, and a draft pension framework had been finalised and wasready for testing. There were moves to promote empowerment programmes, to memorialise and honour those that had passed away, and to maintain a credible and secure database as well as implement a high impact communication and marketing plan.
The financial allocation to the DMV for 2016-17 was R5 97.6 million. 14 500 MVs had access to health care facilities, 1 000 had decent housing, two memorial sites had been erected, 3 500 Military Veterans had access to training and skills development and 60 organs of state were in partnership with the Department. By 2019-20, 5 000 MVs would have decent housing and 17 000 access to healthcare services.
Members asked why there had been no briefing on the turnaround strategy, and no fourth quarter report. What could be done to make the internal audit unit perform optimally? They expressed concerns over serious leadership problems; the lack of realism in setting target levels; people being appointed who were not fit for the job; and MVs deprived of benefits because of the lack of a proper database. They said the current communication strategy was not effective, the risks were not listed, transport was essential and should be secured, and the target for the payment of invoices within 30 days should be 100%. They questioned the status of the case between Z- Health and the Department, the MVs who had received contracts through the preferential procurement policy, and why the medical health budget had been increased by R18 Million.
Department of Military Veterans on 2016 Annual Performance Plan (APP)
Mr Moses Ramphele, Director of Planning, Department of Military Veterans (DMV), said the DMV had eight performance priorities, which included ensuring a fully functional Department with an independent budget vote and systems. A staff complement of 131 had been achieved by 31 March 2015. There had been provision of immediate social relief of distress to the most vulnerable military veterans (MVs), and in collaboration with the South Africa Social Security Agency (SASSA), the DMV had helped 693 MVs who were eligible for such support. Another priority had been to provide comprehensive support services to MVs by acquiring of health care and wellness centre. No progress had been made to accelerate this and the process was ongoing through the Department of Public Works.
In 2014/15, 6 795 MVs had been provided with healthcare support, and 2 450 with training and skills. 1 696 MVs had accessed job opportunities. 96 cooperatives had been registered to benefit MVs and their dependents, and a draft plan had been developed for visiting provinces to provide training for MVs in registering cooperatives. There had been a slow progression towards the finalisation of a memorandum of understanding (MOU) with the Department of Transport. Nine houses belonging to MVs had been rescued from repossession by the banks, and burial support provided for 160 deserving MVs. A draft pension framework had been finalised and was ready for testing. Another priority was to promote empowerment programmes for MVs and in line with this, 78 new service providers had provided skills programmes for MVs and 24 new MVs had been registered as service providers on the DMV’s supply chain management (SCM) database. The remaining priorities were the promotion of Military Veterans’ heritage by memorialising and honouring them, maintenance of a credible and secured national Military Veterans database, as well as implementation of a high impact communication and marketing plan.
The DMV would contribute to the National Development Plan (NDP) in Chapters 3,8, 9, 10, 11, 13, 14 and 15. Strategic objectives for the year under review included memorialising the MVs in death for their sacrifices. The financial allocation for the year under review was R597.6 million. This was made up of Programme 1 (Administration) - R 143 732 000; Programme 2 (Social Economic Support) - R294 080 000; and Programme 3 (Empowerment and Stakeholder Management) - R159 795 000.
The DMV’s annual selected performance indicators for the year under review were as follows: 14 500 MVs would have access to health care facilities, 1 000 of them would have decent housing, two memorial sites would be erected, 3 500 MVs would have access to training and skills development, and 60 organs of state would be in partnership with the Department. Part of its strategic objectives in Programme 2 was to ensure that 5 000 eligible MVs had decent housing and 17 000 had access to health care services by 2019/20.
Mr S Esau (DA) said a task team had been put in place to develop a turnaround strategy. It was supposed to have given effect to a number of changes and addressed the issue of the Management Performance Assessment Tool (MPAT) and audit findings. The Committee had not been briefed about that.
Mr Sipho Majombozi, Convenor, DMV Turnaround Task Team, replied that the turnaround team had always been ready to present to the Committee, but meetings had had to be rescheduled due to other commitments.
Mr Esau said there was no fourth quarter report to give the Committee an update and information that would put the Committee in a better position to discuss issues going forward. At the moment, the Committee was relying only on the third quarter report, which had reflected dismally on the Department, with a bad performance in terms of targets set for various programmes.
Maj Gen Make replied that the fourth quarter report had been recently submitted. As soon as a date was made available the Department would come for the presentation.
Mr Esau said there were a lot of concern about internal controls and the internal audit. There had been an increase in the budget of the internal audit unit. What was going to be done with the additional money to make the internal audit unit perform optimally and improve the audit findings?
Ms Lydia Meso, Chief Audit Executive, DMV, replied that the structure was comprised of only three members, of whom one was responsible for risks and two were responsible for internal audit. The budget had been based on the recommendation of requesting service providers to assist. There was a plan in place to capacitate the internal audit unit so that the DMV would be assisted with internal control measures, and to ensure that MPAT requirements were achieved.
Mr Esau said there seemed to be a problem with the leadership of the organisation. The presentation said Dr S Gulube was the Acting Director General (ADG). If he was the same person as the Secretary of Defence, it reflected very badly on the Department -- it seemed there was a serious leadership problem in giving guidance to the organisation. The Chief Financial Officer (CFO) had been officially appointed and he was happy that the situation in that area was stable. A lot work was still needed to be done to make the Department perform.
Mr Make replied that the CFO and DDG for Social Economic Support (SES) had been recently appointed. Interviews had already taken place and before the end of the month of May, a DDG for Empowerment and Stakeholder Management (ESM) and a DG for the Department would have been appointed.
Mr Esau said it was fine to have great ambitions, but it was also good to be realistic when the DMV pitched levels, as it was now aspiring to reach level 4, when it had never achieved its goals at level 2. People had been appointed who were not fit for the jobs and this had been reflected in the performance of the last two years, where there had been huge under-spending. The policy, monitoring and evaluation (M&E), and all the important instruments that regulated the environment under programme 1 had been reduced. If the budget had been reduced, who was actually sitting on the MOUs, service level agreements (SLAs) and the changes that were going to happen? The strategic objectives said 5 000 MVs would be eligible for decent housing and 17 000 of them would have access to healthcare services in 2019/20. How had the Department assessed that those numbers could be predicted in terms of the budget and that the DMV could achieve them when the database remained a problem? The DMV had predicted 85% achievement but had never achieved that in the last four to five years. So many people had been deprived of their benefits because they had been kept off the database. Only the dependents of those who had been verified continued to benefit. Few people benefited, and 63% of the current database had been denied.
Mr Lesiba Alex Mahapa, DDG, Social Economic Support, DMV, replied that he was only a month and two weeks into the job. He said the Department had priortised the issue of the database to ensure that benefits were delivered. Letters had been written to all the formations within the South African Military Veterans’ Association (SAMVA) to provide a final certificate to verify all members that were part of the database. The formations had been told to indicate the progress made in ensuring that proper verification had been done. The formations were not responding on time, although one-on-one meetings had been held with all of them. Even though the database had not been verified, members were still getting benefits, as none of the 73 000 members had ever been turned away. Each time payment was made, an entity form had to be verified by the National Treasury. There was not enough capacity in the National Treasury to handle all the processes and make sure that the account was authentic, and this caused delays. Since the DMV had said it would pay for those whose children were in private schools, Military Veterans had started to move their children from public to private schools. This had created problems for the Department, as some of these schools were not registered and without account numbers. There was ABET 1 and ABET 2, which also created a problem. The Military Veterans blamed the Department because the departmental structure recognised ABET 1. The Department had decided to give high care to Military Veterans who were in need of it while they were still alive. The DMV wanted to foot the home care expenses so that there could be monitoring via age groups, and patients taken to the hospitals when that was necessary. A system had also been introduced whereby the DDG also visited the MVs in their homes.
Mr Esau asked if the Department actually memorialised the Military Veterans. Reconciliation had been emphasised in national building, and this issue had caused a lot of problems -- MVs had protested to express their anger and disillusionment.
Mr Vernon Jacobs, Acting DDG, DMV, replied that the Department had been able to pay for all the Military Veterans who had passed on. A lot of members did not appear on the database and the Department was moving to capture them by asking the family members to submit details of the deceased, to ensure dignified funerals. The DMV had not been able to facilitate payments in many instances because of a lack of fully verified details. The Department was helping the family members with funds to help them in going forward after the funerals, and to make graves recognisable and in some cases refurbished. The DMV was working in conjunction with the Department of Arts and Culture to have an approved national policy on cremation, repatriation and memorialisation outside of South Africa of those who died outside the borders.
Mr Esau said the budget on communication and marketing had been cut. How did the DMV get to the local newspapers and radio stations to broadcast information that MVs needed in order to access their benefits, as many did not have access to computers and the internet. The current communication strategy was not effective enough. The presentation talked about the strategic objectives but did not say what measures had been introduced by the turnaround team to have these objectives rolled out.
Mr Make replied that the Department had at Exco level indicated that it would be doing roadshows in order to reach the stakeholders without impeding on the roadshows of the Deputy Minister.
Mr Mahapa replied that the DMV was engaged in an IT process to procure a company that would be able to indicate through short message service (SMS), radios, and emails the benefits within the DMV and how to access such benefits. The DMV was engaged in finalising SLAs with the Government Communication and Information System (GCIS) so that it could be accessed by the MVs. The DMV was also holding talks with the Daily Sun newspaper to make free copies available to the Veterans, since the DMV advertised there. The Department was also engaging with the Surgeon General on Friday this week to establish a process to follow for building medical facilities. The Department had engaged the offices of the premiers and the Department of Public Works to find out if they could assist by providing physical structures to accommodate the medical facilities.
Mr Esau commented that it had been said that there would be an understanding with the State Information Technology Agency (SITA) as regards information communication technology (ICT), as it was the best partner in this arrangement to deal with the current situation. What was SITA going to do and at what cost? He hoped the Committee would have more information from SITA on this arrangement when it made presentations to the Committee next week
Maj Gen Make replied that ICT was being attended to at the Departmental level. Although there had been hiccups with SITA, it was however a dual matter. The DMV would give to SITA what should be handled by SITA, and the DMV would handle what it could.
Mr Esau asked what the status of the case was between Z- Health and the Department. This was a multi-dollar contract that had gone sour. The local medical practitioners were no longer willing to give medical care to the MVs, which had caused them to travel by taxis or trains to the main centres to seek such care, and the MVs did not have money to do that. This was a case which would cause the Department a lot of money and the DMV could not afford the luxury of spending money on such cases, but rather on MVs and their needs.
Maj Gen Make replied that the case was still in court and the DMV expected the resolution and finalisation to be addressed not later than the end of the current month.
Mr Esau questioned the issue of MVs who had received contracts from the preferential procurement policy, and asked which formation they belonged to, so that the MVs that really needed the benefits would get the money allocated to the Department.
Mr Jacobs replied that the database showed 134 companies were registered which were owned by MVs. The Department had transferred them to the supply chain so that the MVs could complete the supply chain forms. MVs were invited when Department did procurement for different services in the Department. There was a need to provide them with more training and there were preparations to have supply chain workshops so that MVs could be provided with a greater percentage of involvement.
Mr S Ndlovu, CFO, DMV, added that the annual database system limited the DMV in terms of the actual proper rotation of suppliers. This was being addressed so that there would be proper rotation.
Mr Esau asked why burials and payment of invoices were presented as new indicators when they had been ongoing. What was meant by legitimate invoices? If there were legitimate invoices, then how many of last year invoices were illegitimate, as this would mean pending invoices and funds to be carried over which had not been reflected in the budget.
Mr Ndlovu replied that because the Department was currently using a manual system, there was the continuous challenge of duplicated invoices, and this was the meaning of illegitimate invoices. The DMV hoped to change the system, which would help to create order.
Mr Esau noted that 1 696 Military Veterans had been employed. What was the relationship with the Department of Agriculture, Forestry and Fisheries (DAFF)? Particular Departments, and MVs deployed to do particular tasks, should be mentioned. The Portfolio Committee would like to have sight of the amendments of the Acts and the amendment of the legislation, and what it included. Why would the DMV change the Act to reflect the dependents when the money was not even enough for the current MVs? Why had the budget for medical health care been increased by R18 Million and the beneficiaries only increased by 600? How did this relate to the National Health Insurance (NHI) initiative? Would this remain a separate budget and MVs have a separate health scheme, like it was currently? Money had been allocated to about 58 people who had been denied compensation because they were not verified on the new database. This continued to be a problem, as the MVs concerned were suffering. The Department wanted to replace public transport with another indicator. Transport was essential and it should be secured. The Department should speed up relationship with the Department of Transport, as it was unacceptable that the MVs were being denied transport.
Mr Majombozi said that the purpose of the change in the legislation was to propose a consolidated and clearly defined legislative framework because there were a number of Acts that impacted on the lives of the MVs, such as the Military Veterans Act, the Defence Act, the Mobilisaton Act, the Special Pension Act, the Social Assistance Act, Social Pension Act, Military Pension Act, and South African Citizen Act. There was a need to focus on what synergy could be derived in changing the Act. There was a fully fledged proposal that would be shared with the Committee in a presentation. There was a draft MOU between the DMV and the Department of Transport (DOT). A number of entities of the DOT had subscribed to the MOUs so as to give transport assistance to the MVs. All that was needed was for the two Ministers to append their signatures.
Mr Esau asked for an update on the military pensions that had been approved by the National Treasury. This should be expedited so that MVs could have better incomes than the grants and state pensions that were currently issued.
Mr Mahapa replied that the DMV had negotiated with ABSA to ensure MVs got direct payment. This week the Department had started to dispense the money and would finalise the issue of pensions after the database had been settled. After piloting the issue of pensions, the DMV would contact the National Treasury for the funding.
Mr D Gamede (ANC) asked if 90% payment of legitimate invoices within 30 days of receipt for the next three financial years was acceptable and fair. Why was it not 100%, as the DMV did not have to rely on other Departments to achieve this?
Mr Ndlovu agreed that 90% was light but knowing the history of the Department, it was safe to have 90% as a benchmark. The Department would, however, improve on that.
The Chairperson asked the CFO what percentage of the service providers could be paid within the targeted period.
Mr Ndlovu replied that his benchmark would be the average of the last two months of the financial year, which was 92% .The Department would improve on this when the automated system of tracking invoices was rolled out by 1 June 2016
Mr Gamede said most small, medium and micro enterprises (SMMEs) were going under because of late payment. There had been a move that payment of invoices within 30 days should form part of the key performance indicators.
Mr Ndlovu agreed that it should be part of the key performance indicators, as it was vital that the suppliers were paid on time because it was cash flow issues that affected the sustainability of their businesses
The Chairperson asked why the target was not 100%.
Mr Ndlovu replied that the system currently used was new, and added that the Department was mainly dependent on the availability of National Treasury for the training of staff. To put it at 100% would be overshooting the target.
Maj Gen Make added that some of the service providers’ tax matters were not in order. Every payment was effected through the National Treasury system. The DMV would like to comply 100%, but it was not dependent only on the Department to do the necessary paper work. What happened when the system now started talking to the National Treasury? The document came back to the DMV to be corrected and the process would usually take about three weeks. This was one of the reasons for the delays. He asked the Members of the Committee talk to their counterparts in the Finance Committee to help to speed up the process of the turnaround. He added that some of the service providers came with a different account number at the time of payment, which also created a problem, as registering the new account numbers caused some delays.
The Chairperson said Members of the Committee had been inundated with calls from ordinary suppliers to have their services paid for. When a service provider rendered services, the DMV was obliged to make payment. What Mr Ndlovu was saying was that the Department was not yet digitalized.
Mr Esau asked where the vacancies were. Was restructuring taking place? How many provincial offices were functional and was there sufficient staff to deal with the Military Veterans? Why was there a decrease in travel subsistence? It was good to put the registration of MVs at 60 days, and he hoped the DMV would meet the target. What was the feedback on the MVs running their own housing projects? What had happened to this principle, and was it still under consideration? People had become impatient and needed to know if they were on the waiting list. Was the South African Cape Corps (SACC) recognised, and were they active members of SAMVA? Was there a certificate of recognition to be able to access funds from the Department to set up programmes for their particular formation?
Mr Mahapa replied that 75% -80% of the files on housing had been signed to make sure the MVs had access to housing. The problem was when there were houses in distress, as this involved the services of lawyers who were exorbitantly expensive. The DMV was in the process of changing that. If an MV had a house that cost R450 000 and the Department could pay only R175 000, it was better to say the DMV would build a house for the MV that would cost the amount that they could pay. The DMV tried to be realistic by setting the 60-day target. There was no need to send the politicians on roadshows to talk about the MVs. The DMV would go with the systems within the Department and they would deal with the issues. The politics of the provinces often disturbed the performance of the Department
Mr Majombozi said there were over 12 adverts just this last Sunday in the Sunday Sun, the Sunday World and the Sunday Independent which were addressing the staffing issue of the Chief Director, Director and Assistant Director. This spoke of the targeted capacities that were coming through.
The Chairperson said as regards the 30 day payment, the DMV must do what it was supposed to do as a Department and comply. He added that the political process that was needed in the SACC was about integration.
The Chairperson asked where the DMV had sourced the personnel for internal audit.
Ms Meso replied that the personnel were mainly from the internal audit units of other departments, like SAPS, in accordance with the Public Service Act in order to promote them. These were public servants within the Government. In terms of the structure, the internal audit unit was allowed to have only three members, and there was need for a review.
Mr Esau said the turnaround team should present a workshop to the Portfolio Committee on the turnaround structure.
The Chairperson said there was going to be a strategic review workshop, and the issues that would be presented were the turnaround strategy and pension strategy. He hoped the Committee would be applauding the Department the next time the DMV appeared before it, by virtue of its achievements.
The meeting was adjourned.
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