Department of Public Service and Administration, NSG, CPSI & PSC on their 2015/16 Annual Reports with Auditor General; Progress Report on implementation of recommendations contained in budget report

Meeting report

Opening remarks

The Chairperson said the Committee had received an invitation from one of the state entities as part of its housekeeping duties from. Even though the invitation was addressed to the Chairperson, she suggested that she be accompanied by two Members of the Committee.

The Committee agreed that Ms Z Dlamini-Dubazana (ANC) and Mr S Motau (DA) accompany the Chairperson to the event.

The Chairperson advised all the entities that the focus of their reports should be limited to key areas such as unachieved targets with reasons, financial spending patterns, solicitation for additional funding, and disagreements with the Auditor General (AG) on reporting patterns. The report from National Treasury on impact results was being awaited.

Department of Public Service and Administration (DPSA): Annual Report

Mr Mashwahle Diphofa, Director General: DPSA, reported that the organisation had achieved 45 of the planned 46 targets in the 2015/16 annual performance plan (APP). The entity’s first programme, administration, had been 100% achieved, while programme 2, which deals with policy, research and analysis, had been 86%achieved. The programme’s target to undertake productivity measurements in two selected sectors, to support the optimisation of organisational efficiency and effectiveness, had culminated in design of a productivity management framework for the public service.

The Department had conducted pilot productivity measurements in the North West province’s Department of Health, the Mpumalanga province’s Department of Basic Education, and the Limpopo province’s Departments of Cooperative Governance, Human Settlements, and Traditional Affairs.  The outcomes of the measurements in the three departments indicated the following:

• The Department of Health of the North West province had achieved an organisational productivity score of 531.7 out of a possible score of 870, reflecting a productivity level of 61%
• The Department of Basic Education from the Mpumalanga province had achieved an organisational productivity score of 576.7 out of a possible score of 870, reflecting a productivity level of 66%
• The Department of Cooperative Governance, Human Settlement and Traditional Affairs from the Limpopo province had achieved an organisational productivity score of 580 out of a possible score of 850, reflecting a productivity level of 68%

Other targets achieved under Programme 2 included targets to:

• Analyse implications for the phased implementation of the provisions of the Public Administration Management Act (PAMA) and make recommendations to the Ministry of Public Service and Administration (MPSA) on the policy implications;
• Finalise the research report and feasibility study, and undertake consultations with relevant departments and submit recommendations to the Minister for consideration;
• Complete the accessibility study of Thusong Centres and Thusong Cluster Departments of Home Affairs and Labour, the South African State Security Agency (SASSA) and the South African Police Service (SAPS) in eight provinces;
• Evaluate the status quo with regard to existing norms and standards within public administration;
• Develop guidelines with relevant toolkits to support research within the public service;
• Monitor and report on the implementation of the policy for providing reasonable accommodation and assistive devices within the public service.

All targets for Programme 3 (labour relations and human resources management) had been achieved. The targets were to:

• Monitor and report on the vacancy rate and time to fill posts in accordance with the Public Service Act appointments, and to submit a report to the MPASA bi-annually;
• Conduct research, develop a concept paper on the draft remuneration framework and consult with relevant stakeholders;
• Develop and consult on a proposed model for the Graduate Scheme;
• Support departments to appoint 20 000 youths into learnership, internship and artisan programmes per year;
• Monitor and report on the average number of days taken to resolve disciplinary cases by national and provincial departments, and submit a quarterly report to the Minister of Public Service and Administration;
• Monitor and report on the implementation of the Public Service Coordinating Bargaining Chamber (PSCBC) resolution 1 of 2012 by departments, and submit reports to the Minister;
• Monitor and report to the Minister on the development and implementation of the Government Employee Housing Scheme (GEHS)

The DG said that at the end of March 2016, departments had appointed 26 000 youths, of whom 6  687 had been appointed by national departments and 19 368 by all nine provinces combined into learnership, internship and artisan programmes, thereby exceeding the annual target by 6 055. As regards the GEHS, a housing allowance of R1 200 was paid as a monthly contribution to qualifying employees to assist with the recurring costs of their accommodation, and R300 of the housing allowance for tenants would be saved in the GEHS savings facility in order to assist employees accumulate a deposit required for buying houses. An enrolment support centre had been established and an enrolment system had been developed, and consequently 300 000 employees had enrolled to receive the new housing allowance.

Mr Diphofa said that Programme 4’s targets were linked to the government’s Chief Information Officer (CIO). The targets were to develop an e-enablement value proposition for three prioritised services for endorsement by the concerned business owner, to develop e-enablement information communication technology (ICT) security guidelines, to convene public service CIO to develop mechanisms to improve and sustain e-enablement and technology obsolescence and develop policy guidelines to leverage government’s ICT buying muscle, and to consult on the guidelines for inputs. The DPSA had developed value propositions to support the Departments of Basic Education, Justice and Constitutional Development, Social Development and the SAPS to use ICT to improve the current systems and processes, as well as to improve the quality and speed at which their services were delivered to service beneficiaries. E-enablement security guidelines had been endorsed by the Government IT Officers Council (GITOC) on 9 February 2016, and six CIO forum meetings had been convened to develop mechanisms to improve and sustain e-enablement and technology obsolescence.

Programme 5 included targets to provide technical support through workshops to prioritised departments in the mapping of business processes and the development of standard operating procedures, and to report on the status of the implementation of business processes and standard operating procedures by the three selected Departments of Transport, Social Development and Labour, amongst others. Highlighted achievements of the programme included the conducting of 27 workshops with 277 officials from national departments and 136 officials from 64 provincial departments, an increase of 21% from the previous financial year as regards the submission of reports on the status of the implementation of business processes and standard operating procedures by the selected departments, and support for the Departments of Labour, Basic Education, Health, Human Settlements, Social Development and Transport to develop generic standards for all eight Batho Pele principles.

Highlighted targets of programme 6 were to:

• Issue the MPSA directive on standardised delegation principles and templates, and conduct workshops for selected provincial and national departments to support the implementation of the directive on standardised delegation;
• Develop a guideline for operational delegations and submit it for approval;
• Consult on and finalise the mentoring and peer support framework for senior managers for submission to the Minister for approval;
• Monitor the implementation of the competency assessments practice for senior managers;
• Conduct workshops to support departments in preparing for the implementation of the directive on compulsory capacity development, mandatory training days and minimum entry requirements for senior management service (SMS);
• Monitor the retention of heads of departments (HoDs) within the public service, and produce a report in the 3rd quarter of the financial year
• Revise chapter 3 of the Public Service Regulations, which provide for the revised and electronic submission of disclosure of financial interests;
• Conduct workshops to support the implementation of the revised determination on other remunerative work by departments, to prohibit public servants from doing business with the state;
• Develop an intervention strategy with targeted support mechanisms for human resources, organisational development, information technology, etc., and submit it for approval.

The organisation had achieved all its targets for the programme, and consequently chapter 3 of the Public Service Regulations had been revised, and the entity had developed a strategy to guide the Department when implementing targeted support to strengthen the human resource capacity of poorly performing or struggling government departments in line with its mandate.

Referring to the medium term strategic framework (MTSF) performance indicators, he said that as at March 2016, the annual average time to fill a post in the public service had increased to 9.37 months, from 8.25 months in 2014 and 6.54 months in 2013. The trend indicated the non-compliance of departments with the MTSF. Factors impacting on the vacancy rate and the turnaround time to fill posts included on-going departmental restructuring, insufficient funding to fill vacant posts, competition with private sector institutions, and delays in finalising the prescribed pre-employment verifications on the part of South African Qualifications Authority (SAQA) and the State Security Agency (SSA).

As at 31 March 2016, the number of days taken to resolve disciplinary cases by national and provincial departments had been drastically reduced to 86 days, from 142 days in the previous financial year, and 190 days in the year before that. Cabinet had approved a centralised pool of 330 labour relations officials to support departments with the timeous resolution of precautionary suspension cases, and the pool had to date assisted departments to conclude 130 of the 690 cases.

Of the total departmental budget of R941.5 million, 99.3% had been spent, leaving an unspent budget of R6.7 million. The Public Service Commission (PSC) accounted for the largest expenditure of the Department, followed by administrative functions. The budgets for transfers had been fully utilised, and the savings in labour relations and human resource management included R2.7 million of earmarked allocations for the Public Service Remuneration Review Commission. Compensation of employees had been 99.2% spent, goods and services had been 97.7% spent, with 100% spent on payment for financial assets, 99.9% for transfers and subsidies, and 99.8% for payment of capital assets. Consultancy expenditure had accounted for 11.1% of the goods and services budget and had included payments to the Auditor General and members of the audit committee. All the departmental suppliers had been paid within 30 days.

Mr Diphofa saidthat the Department currently had a vacancy rate of 11.2%, and most vacancies were at the senior management level. There were four vacant Deputy Director General (DDG) posts which had been advertised, and the recruitment process to fill the vacancies was on-going. Due to the cuts in the compensation budget, the Department was in the process of abolishing some of the vacant posts, which would further reduce the vacancy rate. The percentage of people with disabilities in the Department stood at 1.6%, which indicated a shortfall of 0.4% against the 2% target. 

Discussion

The Chairperson said that the DG had failed to indicate if additional funding was needed for the entity, or the impact of cutting the entity’s budget.

Mr A van der Westhuizen (DA) mentioned that the DPSA should be a model institution for other departments, and asked why senior managers had failed to comply with the declaration of financial interests in compliance with chapter 3 of the Public Service Regulations.

Mr S Motau (DA) sought clarity on the definitions of acronyms reflected in the report, and also inquired about the plans of the Department for youths that had completed learnerships.

Mr E Marais (DA) inquired about the funding models used for the Thusong centres. He also asked why it took over nine months to fill vacant positions.

Ms Dlamini-Dubazana commended the Department for its achievements in the financial year. She commented that legislators perhaps sometimes imposed targets without conducting any scientific measurement. As regards the average time taken to fill posts, it was imperative to note that senior management and specialist skills were scarce resources, and consequently the fulfilment of mandates were subject to delays.  She recommended a review of the criteria for filling vacant posts and said that cutting the entity’s budget would greatly hamper its productivity. She inquired if the 97.7% spent on goods and services was the result of non-payment of some service providers, and if accounts had been rolled over after the financial books had been closed.

Ms W Newhoudt-Druchen (ANC) inquired about plans to assist other departments with regard to employment equity, since the DPSA had managed to achieve only a 1.6% disability rate for employees. What measures were in place to assist disabled persons with reasonable accommodation, since the budget was not sufficient to offer assistive devices for them. She said that not enough time had been provided to study the report. She noted that the breakdown of the employment equity was not reflected on page 191 of the annual report, as well as the different levels occupied. She was suspicious of the Department’s intention to conceal details of the employment equity in the organisation.

The Chairperson commended the Department for its clean audit report, as well as for achieving the predetermined objectives. She commented that whilst the Department was addressing its internal issues, other entities should be assisted to achieve a satisfactory level of performance, especially in areas of administrative functions. There were hopes that when reports from the DPSA’s entities were received, crucial issues such as turnaround times for filling vacant positions and administrative issues would be addressed. She urged that more efforts should be concentrated on communicating the achievements of the Department. She then recommended that a public service meeting should be conducted, with a disability indaba, to reinforce the Department’s commitment to improve the employment numbers of persons with disabilities

The DG responded that there had been challenges with the stages involved in financial disclosures. Senior managers had intended to disclose their financial interests, but the process had delayed the submissions. Arrangements were in place with executive authorities to delegate the last leg of the disclosure process to accounting officers, to facilitate the throughput of the process. He added that the delay accounted for the late submission of disclosures and consequently was not reflected in the report, as the disclosure forms had been submitted after 31 March 2016.

He said the number of absorbed learners in the Department had been omitted in the annual report because it had been reflected in the first quarter report. A reasonable number -- but not all learners – had been permanently employed after their internships.

Regarding the average time spent on filling positions, the DG said that the Department recommended an average period of four to six months. The compensation of employees was a limiting factor and it delayed the overall process of filling positions. A new directive had been implemented for factors that could kick-start the restructuring of an organisation, and the Committee would be briefed in due time on the statistics relating to employees with disabilities. Although there were recommendations regarding reasonable accommodation, concerns had been raised that people with disabilities moved into the accommodation space but did not stay because the work spaces were not very conducive for them. Workshops would be conducted by the entity to address issues of reasonable accommodation. It required an estimated R35 000 to provide reasonable accommodation, and that amount was quite affordable for the Department.

Mr Masilo Makhura, Chief Financial Officer: DPSA, responded to Ms Dubazana’s inquiry. He clarified that the 2.3% under-spending on goods and services had included R2.7 million of allocations earmarked for the public service remuneration review commission, which had been reversed, and some invoices had been received after March 2016 and would fall into the next financial year. There had been no roll-over of funds.

National School of Government (NSG): Annual Report

Professor Richard Levin, Principal: NSG, said the National Development Plan (NDP) was unequivocal in its commitment to an efficient and effective public service that was capable of delivering much needed services to the South African population. Embracing a culture of learning was imperative to achieve public service excellence. The NSG had a vital role to play in the professionalisation of the public service and in supporting a capable developmental state through its learning and development initiatives and interventions, focusing on the three spheres of government. The ministerial directives on the compulsory induction programme, as well as SMS capacity development, placed the NSG at the centre of mandatory training. The NSG supported the African Management Development Institute Network (ADMIN) and initiatives with the Chinese Academy of Governance (CAG), the American University (AU) and the French École nationale d'administration (ENA).

The presentation of the 2015/16 annual report took place against the backdrop of substantive positive initiatives and interventions, as well as challenges impacting on the NSG’s overall institutional performance. The NSG had piloted self-paced, free and open online learning in the financial year. The value of open courses lay in the openness of content which could reach a large number of learners in a short time. The openness was ideal for compliance training, allowed learners to take responsibility for their own learning, and was cost efficient and time saving. The pilot programme had resulted in over a million hits, an intake of 18 586 enrolled learners, and 6 594 learners as part of the online communities accessing learning opportunities. A total of 55 904 learners had accessed learning and development opportunities through the NSG.

Cabinet had approved a strategy for the use of retired and serving public servants as facilitators in the NSG, and the initiative would further improve, in an efficient and cost effective manner, the quality of the services the entity offered to the public.

Prof Levin said the entity had commenced an engagement with the South African Local Government Association (SALGA) on the rollout of a councillor induction programme, and it had culminated in the recent conclusion of a Memorandum of Understanding (MoU) with SALGA to collaborate on areas of capacity building in local government. The executive induction programme developed by the NSG was aligned to the directive on compulsory capacity development, mandatory training days and minimum entry requirements for SMS personnel, approved by Cabinet in October 2014. The programme targeted heads of departments at levels 15 and 16 at both the national and provincial spheres of government.

Another highlighted performance of the NSG included the signing of a four-year MoU to formalise the strategic partnership with the CAG on 30 October 2015, to strengthen exchanges and cooperation in the fields of education, training and development, scientific research and policy development and implementation. The NSG had also signed an MoU with the Namibian Institute of Public Administration and Management on 22 September 2015 to formalise a strategic partnership through the sharing of knowledge around curriculum development and e-learning, and had agreed to develop peer learning to benefit both institutions. The NSG planned to host a Southern African Development Community (SADC) capacity development workshop.

The last performance highlighted was the conclusion and approval of the European Union (EU) development support for an amount of €10 million over a five-year period to assist the NSG to implement public service training and capacity building programmes through learning and development. There was currently no funding for the training of unemployed graduates.

Prof Levin said that only 17 of the 27 performance targets had been achieved. Programme 1 (administration) had achieved nine out of 15 targets. Remedial actions had been initiated regarding unachieved targets. These included approval for the implementation of an integrated communication and marketing strategy, approval of the implementation of Service Delivery Improvement Plan (SDIP) in the current financial year, and development and implementation of a Management Performance Assessment Tool (MPAT) improvement plan.

Programme 2 involved public sector organisation and staff development, and eight out of 12 targets had been achieved. Seven research projects had been completed, 21 training needs analysis (TNA) had been undertaken, the NSG had maintained its Public Sector Education and Training Authority (PSETA) accreditation status for the period from 1 February 2016 to 31 March 2018, and 661 learning and development facilitators, moderators and assessors had been contracted. Unachieved targets for the programme included the target to train new public servants on the Compulsory Induction Programme (CIP), and 28 400 persons in leadership, management, and administration. The target to orientate 2 750 unemployed youth graduates through the Breaking Barriers to Entry (BB2E) programme had also not been achieved. Remedial actions were in place to address the unachieved targets.

The entity had received an unqualified audit report from AGSA for the eighth consecutive year. No virement had been requested during the year under review, and all payments had been processed within 30 days of receipt of invoices. An approved total of R38 000 had been incurred as irregular expenditure, and consequently the NSG had not suffered any financial loss. The irregularities were related to non-adherence to the procurement approval process for deviations. In order to strengthen asset management and minimise the risk of losing assets, quarterly asset verifications had been conducted and reports of findings had been presented to the executive management committee.

98% of the entity’s R140.439 million budget had been spent. Transfers, subsidies and compensation of employees accounted for the highest expenditures on the budget. The NSG training trading entity had been established in terms of the Public Finance Management Act (PFMA), operated a trading account, and had received an unqualified audit report by AGSA. A condoned amount of R249 000 had been incurred as irregular expenditure, and the entity had closed the year with no surplus funds. Its main challenge lay in rendering services in respect of course fees, and only R60.134 million of the budgeted revenue of R143.632 million had been realised.

Prof Levin said that 203 of the NSG’s 227 posts were filled, and the entity had a vacancy rate of 10.5%. Of the 49 funded SMS posts, 45 posts were filled, indicating a vacancy rate of 8.2% at this level. He said that 39% of the 203 employees were males, 61% were females, and 2.5% of the workforce was disabled. The entity’s HR footprint depicted 62 male and 89 female Africans, two male and 11 female Coloureds, six male and six female Indians, and ten male and 17 female Whites.

Prof Levin briefly reported on corporate governance, stating that the institution had outsourced its internal audit function to Pricewaterhouse Coopers (PwC) until 31 December 2015, while Grant Thornton (GT) had been appointed as the current service provider with the aim of gradually building internal audit capacity. Tthe risk management focus in the financial year had been on NSG’s strategic risks, IT risks, and operational risks. All compliance reports had been prepared and a monitoring procedure to assess all areas of compliance had been introduced. The entity had a zero tolerance policy and practice against fraud, and consequently no fraud and corruption cases had been reported against the entity’s employees and its service providers in the financial year.

The Principal also presented on the second quarter preliminary progress against the budget. The financial performance revealed that 75.56% of the administrative allocation had been spent, broken down into 48.78% on compensation of employees, and 100% for transfers and subsidies, payments for capital assets, and payments for financial assets. 292% had been spent on goods and services, but he affirmed that National Treasury (NT) had approved an additional allocation of R15.9 million through the Adjusted Estimates of National Expenditure (AENE) process.

In his concluding remarks, he said that the NSG offered its learning and development opportunities through a suite of 130 accredited and non-accredited courses and programmes. Research revealed that the national and provincial governments had training budgets close to R4 billion per financial year, and only 7% of that was allocated to the NSG. The partnership with SALGA and state-owned entities would ensure that the NSG had a more meaningful footprint across the public sector which would give effect to the imperatives of the PAM Act, which aimed at ensuring uniform application of the constitutional values and principles of public administration. The pilot programme with the online learning during 2015/16 financial year also indicated the huge potential of the NSG to realise the vision of being a global player in online learning. NSG’s international partnerships were raising its profile on the African continent and globally. 

Discussion

Ms Newhoudt-Druchen commended the report of the NSG and the achievement of the 2.5% rate for employing people with disabilities. She asked if people with disabilities were included in the entity’s figures as regards online learning. She sought clarity if there was still a loss of R40 million from the previous financial year, after the entity had received the R15.9 million from National Treasury. Were disabled persons employed only in the lower levels, or across all levels of the organisation.

Mr Van der Westhuizen lamented that achieving 17 out of the 27 targets was not a proud statistic for the entity, since the targets had been set by the entity and not by an outside body. Why were the entity’s huge debts not classified or written off as “irrecoverable”? As regards the online courses, he said that there was a clear distinction between website hits and successfully completing courses, so he wanted to know the number of candidates that had successfully completed their qualifications with the school and the statistics of courses registered on the national learner database.

Mr Motau said that there was “an uneven playing field in terms of funding” for the entity. He asked about the measures in place to make the school self-funding, as some departments obtained quotes from the school only to fulfil their compliance mandates. He suggested making interventions so that departments would be charged a non-refundable fee when obtaining quotes from the NSG. While it was imperative for the school to be self-funded, the school might also become complacent and not be as rigorous as desired.

Ms Dlamini-Dubazana said that the NSG’s business architectural plan should be changed while accreditation and affiliation issues were addressed. She said that no candidate would enrol for a course just for the sake of obtaining a certificate, but rather for better opportunities after course completion. Were the training courses accredited, and was there affiliation with universities? She said the NSG could not operate as a business entity without an approved marketing strategy, and added that the entity had to have a very attractive marketing strategy that was appealing to both the public and private sectors.

The Chairperson said that the Committee might need to engage the Treasury to identify means of assisting the NSG with its trading account. A policy shift might be necessary to assist the entity function as a full-fledged business unit and conduct its operations to generate income. Certification and affiliation issues perhaps accounted for why departments did not picture the NSG as their preferred training provider. A policy shift was also needed to ensure that departments appointed the NSG as the preferred training service provider before approaching private entities. She asked about the entity’s debt recovery strategy, and said that the payment of service providers within 30 days must be fully complied with.

Ms Ayanda Dlodlo, Deputy Minister: DPSA, commented on issues raised by the DG of DPSA as regards learnership, the average time taken to fill vacant posts in the public service, and the orientation of over 2 200 youth graduates by the NSG.

She said that a few years ago, the post of Deputy Director General (DDG) for service delivery in the Department had been advertised, and short-listed candidates had included a traffic officer and the branch manager of a retail store. The candidates had been short-listed due to the way citizens were prepared to respond to the labour market. The NSG could assist in such instances to prepare citizens to respond properly to the labour market. Regardless of its issues, the SABC had a public service announcement responsibility and should be effectively utilised. There were currently no programmes to educate unemployed citizens about work environments, and the general public should be engaged through the effective utilisation of the media. Parliament itself was a platform to engage citizens positively, as opposed to relying solely on newspapers and private media. Very few citizens in the country could afford cable TV, where they could get access to educative channels like the Parliamentary channel.

Prof Levin responded on the issue of employee statistics. The NSG had five employees with disabilities, SMS personnel made up 20% of the workforce, 20% were in middle management, and levels 1-8 make up 60% of the employees. As regards accreditation, the school currently runs over 130 programmes and 82 of them were Education and Training Quality Assurance (ETQA) accredited. He said that the actual number of candidates trained was not available, and the levels of disabled employees in the organisation would be provided. Most of the programmes were accredited, and there was no real basis to accredit some other courses because they were very practical, and meant for delegations to understand their roles. There appeared to be no real value in the accreditation of such online courses. A policy shift needed to be considered and would not necessarily result in complacency at the NSG, but would rather assist it to put the training quality required in place.

Ms Phindile Mkwanazi, CFO: NSG, said that there had been a loss for the 2015/16 year, and the additional funding of R15.9 million had been to assist the entity to reduce its budget for the 2016/17 year, due to its reserves. The reserves had been used to cover the debt for the financial year. As regards outstanding debt, only R36 000 had been written off and as a principle, the entity did not write off debts when training had already been offered. National Treasury was assisting in recovering the debt, and pre-payment for training which had been introduced in July 2015 -- had assisted in reducing the entity’s debt, even though not all entities agreed with the pre-payment plan.

The Chairperson commended the report, and asked that the Committee be briefed in future engagements about the NSG’s interactions with the National Youth Development Agency (NYDA) on issues relating to learnerships and internships, as both entities had similar mandates.

Centre for Public Service Innovation (CPSI): Annual Report

 

Ms Thuli Radebe, Executive Director: CPSI said the organisation had improved from the previous financial year as regards the achievement of annual targets. It had achieved a clean audit in its first year of being a stand alone entity. AGSA had considered the internal controls relevant to the audit of the financial statements and compliance with legislation, and had not identified any significant deficiencies in internal control.

The CPSI had achieved 100% of its annual targets. In Programme 1, it had successfully implemented effective, efficient and transparent financial management and internal control systems that complied with sections 39 and 40 of the PFMA in terms of budget management and reporting responsibilities. It had successfully established structures, systems and processes in compliance with all statutory requirements and applicable legislation. Other achievements of the programme had included the implementation of transversal systems and the operation of the CPSI in line with the approved financial and human resource delegations. 15 new policies had also been developed and approved.

With Programme 2 (public sector innovation), the CPSI had partnered with SAPS and the Innovation Hub to derive a solution that would improve SAPS’s response times to incidents of crime in informal settlements. The proposed solution which had been identified via the Memeza Household and Community Alarm had been selected for piloting in Diepsloot, and the completion of the first phase had led to the installation of a further 560 units as part of the second phase of the pilot, with the support of private sector funders. The solution had already contributed to the reduction of crime in the pilot community and resulted in a number of arrests, the creation of seven jobs in the community, and the empowerment of a small, medium and micro enterprise (SMME). Additional funding had been solicited from the Tirelo Bosha grant facility for the further expansion of the project to the Gauteng social and educational sectors, and a further rollout of the project would result in creating additional job opportunities. Due to its success in improving the response time by the police during criminal attacks on citizens, the project had been recognised by the Premier of Gauteng in his 2016 State of the Province Address for support towards its roll-out in other areas and sectors.

The Director also reported that an energy-efficiency model had been developed, and phase 1 of a pilot project had been initiated at Helen Joseph Hospital, with a focus on retrofitting and behavioural changes, to achieve at least a 25% reduction in energy consumption annually.

A partnership with the private sector had resulted in the expansion of the e-learning project in Mthatha (Eastern Cape), which had been a commitment from the previous financial year.

Ms Radebe said that two CPSI award-winning projects had been identified, facilitated and supported for replication. The projects were the “Saving Blood, Saving Lives” solution and the “Dietetics Project”. The first, which had saved R13.25 million since 2013 through the efficient use of blood and blood products from Edendale Hospital, was now being replicated at Bertha Gxowa Hospital. The Dietetics Project, which focused on the reduction of malnutrition in vulnerable children, was being scaled up in other districts in Limpopo, and the National Department of Health had committed to donating equipment to the project as a result of hospitals running out of beds. Through the 13th CPSI public sector innovation awards ceremony held in October, the Minister had awarded 20 public sector innovative solutions.

She also briefed the committee that the United Nations Public Administration Network (UNPAN)-SADC regional workshop had been hosted in 2015 and had been well attended by representatives from ten SADC countries. Sector specific innovation workshops had been held for the Departments of Home Affairs, Correctional Services, and Health, and a foresight exchange forum for development in Africa had been hosted in partnership with the United Nations Development Programme (UNDP). These interventions were aimed at achieving outcome 11, which referred to creating a better South Africa, a better Africa, and a better world. Other notable innovations and interventions included the successful hosting of the ninth public sector innovation conference, the publishing of two editions of “ideas that work”, and the entity’s multi-media innovation centre, among others.

The Centre had spent 96.7% of its total budget allocation, leaving a variance of R948 000. A substantial amount of the budget was spent on the compensation of employees and goods and services. During the previous financial year, the CPSI had applied for additional accommodation through the Department of Public Works, but the application had not been finalised in the 2015/16 financial year as anticipated, and consequently there had been under-spending on the payment of the lease for the additional accommodation. The funding allocated for the filling of one SMS post had required the reprioritisation of funding for the post, due to higher cost of living adjustments and notch increases within the organisation, and this had culminated in a request to abolish the position.

Discussion

Ms Dlamini-Dubazana commended the CPSI’s report and inquired about the measures in place to reduce queues in public sectors and the collaboration strategy in place to engage with Statistics SA on such issues.

Mr Van der Westhuizen said that all of the CPSI’s projects had been on-going for years, and asked if any new projects had been initiated in the 2015/16 financial year, since innovation was a crucial mandate for the entity.

Ms Newhoudt-Druchen said that two schools for disabled children had been burnt down and in previous years, a school for the blind had been torched. Recently, three disabled girls had died in a fire incident. She then inquired about fire alarms with flashing lights for facilities occupied by disabled persons. Adopting technology from overseas might not be cost-effective for the entity, but there were institutions within the country with technology which could be adopted. She said that in cases of recent events such as the natural disaster in Haiti, people with disabilities were always the last to be found and rescued.

Ms Radebe responded that a study had been conducted, and most queues in the public service were identified to stem from back office issues, while some others were initiated by referrals between hospitals and clinics. SMMEs had been appointed to address the issue of referrals between hospitals and clinics, as public entities were already overwhelmed. She said that most projects were multi-year projects, and pilot studies were first conducted before rolling out projects. The large scale roll-out of projects presented new challenges. There were new innovations, such as inland water projects and others, but the entity had not been able to fully report on the projects due to time constraints. She added that the research conducted had also revealed that many patients were waiting to have eye cataract surgery, and the entity was working to assist accordingly.

The Chairperson mentioned that in future engagements, reports should be presented on the omitted projects, as such projects were positively impacting service delivery.

Ms Dlamini-Dubazana said that queues could not be taken lightly, as government policies failed at the implementation stage. She said that “many marriages that were witnessed in the community were not born out of love, but out of queues in the public service”. She added that the CPSI should duly address the queues issue to assist in the implementation of policies. 

The Deputy Minister said some of the issues identified were the responsibility of other departments, such as Departments of Health and Public Works. She said that the queue management system had failed gradually over the years, and South Africa had not invested in research and development. One of the challenges of the CPSI was that it relied solely on information received, as its research capacity was financially constrained. She urged the Committee to engage the Departments of Health and Public Works, and said that the Committee had a wider responsibility to the public, which was beyond the entities. She said none of the savings realised from the Edendale Hospital had been invested into the research and development function of the CPSI.

Public Service Commission (PSC): Annual Report

 

Dr Dovhani Mamphiswana, Acting Director General: PSC, said that the organisation had significantly improved in the manner in which the work of the entity had been carried out through its work streams since the implementation of the new governance rules. The entity had a budget of R229.3 million and a total of 268 employees. During the period under review, it had witnessed a series of appointments of commissioners at both the provincial and national level, and the decentralisation of the majority of the entity’s work to provincially and nationally based commissioners and to specific cluster departments had contributed to increased efficiency. In an effort to increase its footprint, during the reporting period, the PSC had conducted service delivery inspections at selected schools, hospitals, and border posts on the availability of learner technician support material. The PSC had signed an MoU with the University of South Africa (UNISA) which provided a collaborative framework in selected areas of research, monitoring and evaluation, and the development of public administration.

The organisation had achieved 88.7% of its annual targets, which was a slight increase from the previous financial year. Although performance had improved only slightly, it was encouraging that 16.1% of the outputs had been achieved earlier than planned. Although the number of grievances lodged with the PSC had increased, the finalisation rate had improved, due to the review of internal processes, and as a result, 89% of the grievances had been finalised -- an improvement of 14% from the previous year. The rate of finalisation of complaints had also increased significantly by 14% over the reporting period.

The entity had developed a framework for the promotion of the Constitutional Values and Principles (CVPs) governing public administration, which would in future provide Parliament and provincial legislatures with trends on the performance of the public service against the CVPs. The PSC continued to manage senior managers’ conflicts of interest through the Financial Disclosure Framework (FDF) and for the second year in a row, it had scrutinized all financial disclosure forms received.

Dr Mamphiswana also reported on the rigorous nature of the entity’s mandates and said that the organisation had in turn prioritised capacity strengthening through training programmes and partnership with UNISA. The PSC had maintained its unqualified audit record and continued to contribute effectively to public administration through its research.

Financial constraints had been a major challenge to its ability to respond effectively to its stakeholders, and prioritisation of some selected mandatory projects had been adopted as a tool to mitigate them.  Some outputs had been delayed or reprioritised due to capacity constraints or the need for additional research. The relocation of the national office had impacted negatively the operations of the PSC and had also diminished employee morale. Nationally-based commissioners had been assigned to specific cluster departments to prevent the tardiness of departments in submitting required information.

Dr Mamphiswana said the PSC had spent 99.81% of its budget allocation and had achieved 88.7% of its predetermined objectives and through its stringent financial management process, the entity had received an unqualified audit for the 2015/16 financial year. There had been under-spending of R433 000 out of its total allocation of R229.8 million, the bulk of which emanated from Programme 1 (administration). The intention of the National Treasury to cut the entity’s budget by R5 million would hamper it in fulfilling its mandates. The PSC had implemented a limited number of projects due to financial constraints, and had also deliberately delayed the filling of certain posts in order to generate savings for its operations. Its cost containment measures had resulted in savings of R3 million and although the PSC did attempt to cut costs, unexpected costs such as increased costs for office accommodation had arisen.

As regards the human resource capacity of the entity, he said that the organisation had a vacancy rate of 10% and some posts had been re-advertised as suitable candidates had not been identified. The organisation was comprised of 85% Africans, 7.5% Whites, 5.3% Coloureds and 3% Indians. He said that 1.87% of the employees were disabled, and there were more female employees at the management level.

As regards communication and IT, engagements had been made with stakeholders in the form of lectures, communiqués and newsletters, amongst others. A network monitoring tool had been implemented to enhance productivity and the effective utilisation of network resources, and in line with cost cutting measures, the internet protocol telephony had been fully implemented at the national office and the eight provincial offices.

Programme 2 of the entity referred to leadership and management practices. 89% of the grievances that had been properly referred had been finalised. Regarding labour relations improvements, the PSC had conducted two studies with specific functions that were located within the Department of Justice and Constitutional Development (DoJCD,) which had been designed to assess the effectiveness and efficiency of the Office of the State Attorney and the Office of the Chief State Law Advisor. The two reports had been submitted to the Minister of Justice and Correctional Services and the DG for the DoJCD.

As part of the oversight and monitoring function of the entity, the PSC had produced a fact sheet on grievance resolution in the public service for the 2014/15 financial year. It had published a grievance management communiqué to promote sound labour relations in the public service and information sharing with labour relations and employees in general. The PSC had continued with its compliance monitoring with the signing and filing of performance agreements by HoDs, and had conducted an inquiry into the implementation of the HoD evaluation deviation that had been issued by MPSA. Research had also been conducted in key areas related to human resource management, and an audit had been conducted on the recruitment and selection processes in the Gauteng Department of Finance. A skills and competency audit of human resources and financial management among senior managers had been conducted in the Western Cape. The PSC had also provided extensive inputs to the Presidential Remuneration Review Commission, following their call for submissions.

Programme 3 of the Department related to monitoring and evaluation. The main focus of the programme was to prepare material for the promotion of the nine values and principles in section 195 of the constitution, and a framework for the evaluation of departments against these values. The concept design of a data warehouse that would store the data to be used in evaluations had been completed and the PSC had developed guidelines on analysing strategic plans and annual reports.

The entity had also engaged with other portfolio committees and committees in Parliament, and a roundtable discussion had been hosted on the 2014 state of the public service report. The PSC had conducted 16 inspections of many service delivery sites, which had provided it with valuable information on practical service delivery challenges. Following the inspection at the Pelonomi Regional Hospital in the Free State, to determine the challenges experienced by the hospital in respect of patient treatment, safety and security services and the availability of medicines and medical equipment, the Department of Health had set aside an additional R170 million for the hospital’s goods and services in 2015/16.

As regards the fourth programme of the PSC (integrity and anti-corruption), the DG highlighted that the application of the citizens’ forum toolkit in Mpumalanga province had resulted in the identification of a site for the building of a clinic in Msukaligwa Local Municipality, and had also resulted in progress as regards building Vezikgono Secondary School in Thembisile Hani Local Municipality. The complaints rules and guidelines had been reviewed to improve efficiency. The PSC had conducted investigations and assessments of the awarding of higher salaries on appointments and counter offers in the National Departments of Transport and Labour, and 73% of the received complaints had been finalised. The PSC had developed a three-year strategy for promoting professional ethics in the public service.

During the 2015/16 financial year, the PSC had received 48 424 calls on the national anti-corruption line and a total of 2 499 case reports had been generated from the calls. 45% of the generated reports had been closed through early resolution, and the remaining 55% had been referred to national and provincial departments and public entities. As regards professional ethics, the entity had had an overall compliance rate of 82% as at 31 May 2016, as per the Financial Disclosure Framework (FDF) of the public service. The PSC had scrutinised 100% of the financial disclosure forms received, and the financial interests of SMS members who had not submitted their financial disclosure forms had also been scrutinised to assess their involvement in any activities of the companies that could lead to potential or actual conflicts of interest. Where applicable, the PSC had conducted consultations with SMS members who were found to be involved in activities that could be construed as posing a conflict of interests.

The PSC’s visibility programme ensured that during the reporting period, the media extensively covered reports of assessment of the management of service terminations and pension pay-outs in the public service, the availability of learner and teacher support material, and the assessment of the effectiveness and efficiencies of the Office of the Chief State Law Adviser and Office of the State Attorney. For the first time, the PSC would submit a report detailing the compliance with principles in section 195 in 2016.

The entity had commenced with inspections in health facilities in the Eastern Cape, the Free State, KwaZulu-Natal and the North West provinces. Inspections had also commenced at border posts and police stations, and inspections had been concluded to conduct an evaluation of the level of adherence to the constitutional values and principles in district hospitals in the Western Cape. Reports on an investigation and evaluation of the awarding of higher salaries on appointment and counter offers in the National Departments of Transport and Labour had been finalised. The overall submission rate of financial disclosure forms by the due date of 31 May 2016, had been was 98%. As regards the National Anti-Corruption Hotline (NACH) cases on the database as at 30 September 2016, 92% feedbacks had been received, with 91% closed and outstanding cases accounting for 9%.

Mr Mamphiswana concluded remarks that the entity was severely constrained by limited resources and said that the PSC would continue to execute its mandate through conducting its oversight work in the public service. He said that the PSC, being a knowledge-based organisation, did not outsource its work and the bulk of the entity’s budget was allocated to employee compensation. The imbalances created in PSC’s budget -- 81% for employee compensation and 19% for goods and services -- were being corrected and 11 posts had been abolished as at March 2016. To ensure improvements, continuous engagements would be held with stakeholders and in response to their demands and its financial constraints, the PSC would have to identify vacant posts to be abolished and re-prioritise its work.

Discussion

Ms Newhoudt-Druchen commended the PSC’s performance in respect of employment equity and the level of disabled employees in the organisation. She inquired about the interventions of the PSC to assist other departments to meet the needs of disabled persons.

Mr S Mncwabe (NFP) sought clarity on the impact of the office accommodation on staff morale, as highlighted among the entity’s challenges. He asked for an update on the issues relating to the late submission of documents by some government entities, where some commissioners had been appointed to address the issue. As regards Programme 1, which had highlighted the delay of appointments due to financial constraints, he asked how critical the posts were for the entity to meet its mandates.

Mr Ben Mthembu, Deputy Chairperson: PSC responded that as regards the non-cooperation of departments, which adversely impacted on progress in terms of work, the accommodative nature of the entity was being misunderstood for leniency. The PSC could no longer compromise on the resolution of grievance cases, and had taken a clear decision to summon HoDs and DGs of non-cooperating departments to give advise them of this. Two departments had been summoned, and results had been achieved.

The DG said that as regards the filling of posts, the delayed posts were not critical. With regard to documentation needed to finalise work, some officials had been summoned to provide the necessary information.

The CFO addressed inquiries related to the accommodation. She clarified that the entity had moved into the premises in July 2015 as an interim arrangement, and said that a lot of officials had fallen sick due to “sick building syndrome,” as described by the Department of Labour’s findings. The syndrome had been caused by improper ventilation and inadequate lighting, due to partitioning. The premises were ideal for an open plan office, but not for closed offices.

The Chairperson suggested that the Committee consider engaging the Department of Public Works on issues of accessibility for disabled persons, and added that there were indications that the DPME also had concerns about the quality of service provided by the DPW. She thanked the PSC for the presentation.

Audit Outcomes for the Public Service Administration Portfolio: AGSA Briefing

 

Mr Carl Wessels, Senior Manager: AGSA, said that the overall audit outcomes had improved over the year due to the clean audit opinions achieved by the DPSA and CPSI, and added that the audit opinions of NSG Department and NSG trading entity (TE) had remained unchanged as financially unqualified, with findings on compliance with legislation. PSC had regressed from a clean audit to financially unqualified, with findings on compliance and legislation.

Senior managements were encouraged to be vigilant to ensure policies and procedures were applied consistently to prevent non-compliance with supply chain management legislation. Investigations of all instances of non-compliance should be conducted and appropriate action taken where individuals were found to be responsible of wrong doing to prevent the recurrence of non-compliance. Performance planning and reporting had regressed due to the NSG Department and NSG TE, which had failed to use the annual performance plan approved by the Minister to form the basis of their annual performance report.

Despite the portfolio not receiving any modified financial audit outcomes, focused interventions and commitments were still required in order to improve the current status of the overall audit outcomes. Dedication was required for NSG Department, NSG TE, the DPSA and PSC to adequately address compliance findings, and the efforts of senior management in developing and implementing controls for compliance with legislation remained a concern. The capacity of DPSA’s internal audit unit was constrained due to its dual responsibility for the DPSA and the CPSI. The PSC had avoided findings due to the correction of material misstatements during the audit process.

As regards financial management, Mr Wessels said that all entities of the portfolio should be commended for submitting annual financial statements that were free from material misstatements. Investigations of unauthorised, irregular and fruitless and wasteful expenditure had implicated five entities in 2015/16, compared to three in the previous financial year. He identified the top three root causes preventing clean audit outcomes as the slow response by management, the lack of consequences for poor performance and transgressions, and instability or vacancies in key positions. Recommendations made included taking disciplinary action against officials where audit findings were repeated or not resolved timeously, and holding senior managers accountable to address audit findings in their environments through their performance contracts.  He said that only one of the key commitments by the Minister had been implemented, while others were in progress. Engagements had been made with the executive authority three times during the 2015/16 audit cycle and the outcomes for the portfolio and government as a whole had been discussed with the Minister.

Discussion

Ms Dlamini-Dubazana said that the DGs of entities should be engaged simultaneously with the AG to clarify discrepancies in audit opinions.

Ms Newhoudt-Druchen sought clarity on the statement “usefulness of reports” and inquired if only CFOs were met during quarterly engagements, or if internal audit committees were equally engaged.

Mr Wessels responded that the AG would like to engage with the Committee again when the general report had been presented by the AG. He said that there were two separate sections in which DPMA and DPME were addressed in the AG’s general report, and both sections were vast. He defined “usefulness of reports” as reports that were in line with the annual reporting principles of the National Treasury, were consistent with planned programmes, had a proper definition of indicated targets, were measurable and time bound, and were relevant to the entity’s mandates. Engagements had been made at various levels, and executive authorities and accounting officers were engaged at least bi-annually. CFOs and audit committee members were engaged as required.

The Chairperson said that the Committee’s recommendations must reflect all the issues raised by the AG. She added that the AG was welcome to attend its Committee meetings to advise the Committee on pertinent issues. She thanked all Members and attendees for their rigorous engagements.

The meeting was adjourned.