Community Works Programme, with Deputy Minister present

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Cooperative Governance and Traditional Affairs

07 March 2017
Chairperson: Mr M Mdakane (ANC)
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Meeting Summary

Deputy Minister Andries Nel said the Community Works Programme was one of government’s programmes seeking to address inequality, poverty and unemployment, and was part of a social safety net for the very poor. The Programme had created 238 000 work opportunities and had been rolled out to 234 municipalities, with 84% of those employed being women and 43% being youth. Steps had been taken to increase the effectiveness of the programme in terms of the individual participants as well as the community where programmes were run. This was done through partnerships with other government departments like the Department of Correctional Services, which had provided land for vegetable gardens, and the Department of Small Business Development, which provided training in establishing small businesses and cooperatives. In Erasmus, over 20 cooperatives had been established. The programme also sought to establish partnerships with NGOs.

The Community Works Programme was very creative in establishing partnerships between government and civil society, it also led to difficulties in administrative accountability and compliance. The programme was beset with serious administrative challenges. There were allegations of wrongdoing on the part of Department officials, participants and some Implementing Agents. He emphasised that the Department had a zero tolerance to fraud and corruption and had instituted investigations.

The Department said the Community Works Programme faced challenges arising from its implementation model, which entailed working with non-profit organisations contracted as Implementing Agents and because of the distance between the national department and the locality where the programmes were taking place. These challenges were highlighted by the audit findings of the Office of the Auditor General. The Government Technical Advisory Centre also identified project management challenges, while the findings of a forensic audit conducted in 2014/15 also revealed challenges.

Challenges arose after a transition from the three-tier model of Lead Agents, Provincial Implementing Agents and Local Implementing Agents to the one- tier model to improve programme efficiency, but this had resulted in unintended consequences, with the Programme taking on Implementing Agent functions. A September 2015 forensic audit had highlighted irregularities and because of the extent and severity uncovered by this investigation, the scope of the investigation had been extended and the Community Works Programme management information systems had been reviewed. Based on recommendations from the investigations, disciplinary action had been taken against three officials and investigations into 29 other cases of possible fraud and corruption were finalised.

A critical issue was that the current contracts with the nine Implementing Agents would lapse on 31 March 2017. The dilemma was that some of the current Non-Profit Organisations were under investigation for allegedly being appointed irregularly. The Department requested approval of a 6-months extension of current NPO contracts, to finalise the appointment processes as well as to ensure that all necessary controls were in place.

The Department and Government Technical Advisory Committee had reviewed the current implementation model and agreed that the integrated implementation model was the preferred model. However, there were still question marks about the extent of the Department’s liability for accounting for site assets using the Integrated Implementation Model.

Members asked what tangible outcomes had impacted on municipalities as a result of the Community Works Programme. Members said the growth in numbers for the current period was not as high as that experienced in the initial phase. Members said the Department appeared to be falling into the contract extension trap, as in the case of SA Social Security Agency. Members said the presentation made reference to three different dates for Implementing Agents to be operational, March, July and December 2017. Which was the correct one? Members said it should not take that long to appoint a programme manager; disciplinary cases had to be dealt with timeously and also that a large amount of money should not be used to chase the repayment of a much smaller amount of money; and asked if the Department had a model of accountability it could focus on.

Members asked how far the process was to develop participants becoming entrepreneurs through their exposure to the Community Works Programme. Was prior learning recognised? Members asked if the Programme was related to the Department of Public Works programmes; was there any coordination with other departments; and was monitoring done that the participants were doing the work they were supposed to do? Members asked what the value-add was for individual participants; and if there was any information that the people working in the programme were regularly rotated so that everybody could benefit from the project.

Meeting report

Deputy Minister’s opening remarks
Mr Andries Nel, Deputy Minister, said the Community Works Programme (CWP) was one of government’s programmes seeking to address inequality, poverty and unemployment, and was part of a social safety net for the very poor. CWP had created 238 000 work opportunities and the programme had been rolled out to 234 municipalities, with 84% of those employed being women and 43% being youth. Steps had been taken to increase the effectiveness of the programme in terms of the individual participants as well as the community where programmes were run. This was done through partnerships with other government departments like the Department of Correctional Services, which had provided land for vegetable gardens and the Department of Small Business Development, which provided training in establishing small businesses and cooperatives. In Erasmus, over 20 cooperatives had been established. CWP also sought to establish partnerships with NGOs.

However, while CWP was very creative in establishing partnerships between government and civil society, it also led to difficulties in administrative accountability and compliance. CWP was beset with serious administrative challenges. There were challenges of allegations of wrongdoing on the part of Department officials, participants and some Implementing Agents (IA). He emphasised that the Department had a zero tolerance to fraud and corruption and had instituted investigations.

Department briefing
Mr Charles Nwaila, DG, briefed the Committee.
CWP had attracted a number of interested parties to conduct studies to assess the impact of CWP because of how it had touched the lives of people. The first was conducted by the Centre for the Study of Violence and Reconciliation in August 2013.  The Institute for Security Studies conducted a study focusing on the impact of CWP on intimate partner violence, collective violence and crime in general and the International Labour Organisation (ILO) in Geneva conducted a study focusing on the employment sector with special reference to CWP.

The CWP faced challenges arising from its implementation model, which entailed working with non-profit organisations (NPOs) contracted as IA’s and because of the distance between the national department and the locality where the programmes were taking place. These challenges were highlighted by the audit findings of the Office of the Auditor General. The Government Technical Advisory Centre identified project management challenges and the findings of a forensic audit conducted in 2014/15 also revealed challenges.

There had been a transition from the three-tier model of Lead Agents, Provincial IAs and Local IA’s which was introduced in 2012, to the one- tier model introduced in 2014, to improve programme efficiency by decreasing the number of IAs, resulting in nine IAs being contracted. But this had not yielded the desired results because there were unintended consequences, with the CWP taking on IA functions. The Department had ensured that some resources were provided and three specialised support units were established in the CWP to effectively carry out the additional responsibilities.

The September 2015 forensic audit had highlighted irregularities and because of the extent and severity uncovered by this investigation, the scope of the investigation had been extended and the CWP management information systems had been reviewed.

Based on recommendations from the investigations, disciplinary action was taken against three officials. However, senior counsel for the Department advised that the case against the three was not strong enough. A decision was then taken that this matter be put on hold until finalisation of the second phase of the investigation. In the meantime, investigations into 29 other cases of possible fraud and corruption were finalised. Seven cases were closed as these were either actioned by the IAs or the information available was inconclusive. Eight cases required disciplinary action by the IAs against supervisors and site administrators, while 14 cases were reported to SAPS. The potential loss due to fraud was R8 588.

Key issues relating to the current single tier model that needed to be addressed were: Oversight and Monitoring; Financial Management; Procurement and Contract Management; Compliance Management; HR Management; IT Management; and Financial Health. Mr Nwaila then spoke to the actions the Department was taking to address these issues.

One critical issue was that the current contracts with the nine IAs would lapse on 31 March 2017. The dilemma was that some of the current NPOs were under investigation for allegedly being appointed irregularly. The Project Management Unit (PMU) intervention would assist the Department to fast-track the recruitment process of the new NPOs more stringently.

The Department and Government Technical Advisory Committee had reviewed the current implementation model and agreed that the integrated implementation model was the preferred model. However, there were still question marks about the extent of the Department’s liability for accounting for site assets using the Integrated Implementation Model.

Deputy Minister Nel said there were areas which led to difficulties in accountability which created the space for wrongdoing to occur.

Dr S Mngadi, CWP Executive Manager, said the CWP was in all 234 municipalities in the country and the challenge was to account for every asset that CWP had procured. As from 2017/18, not only assets but also consumables had to be accounted for. The assets for 2016 had been verified and it had been found that some assets were not accounted for because the current IA had inherited them from previous IA’s and there was no documentation for these consumable assets.

Deputy Minister Nel said time and effort had gone into dealing with that problem

Mr Nwaila said the Department requested approval of a 6-months extension of current NPO contracts, to finalise the appointment processes and tools, as well as to ensure that all necessary controls were in place. National Treasury gave conditional approval. As a result of these engagements, the Department wanted to acquire short-term external project management skills to ensure that in the next three to four months, there would be stability in CWP. Business processes, systems and structural issues will be clearly mapped out for the new NPOs. The first phase was stabilisation through the establishment of the PMU and the Department would continue to prioritise the appointment of the DDG. In the second phase was the establishment of an appropriate institutional home for the CWP, due to distance between the national department and the locality where programmes were run.  

Discussion
Mr K Mileham (DA) asked what tangible outcomes had impacted on municipalities as a result of the CWP. He said the growth in numbers for the current period was not as high as that experienced in the initial phase. The Department appeared to be falling into the contract extension trap, as in the case of the SA Social Security Agency (SASSA). The presentation made reference to three different dates for Implementing Agents to be operational, March, July and December 2017. Which one was correct?

Mr N Masondo (ANC) underscored Mr Mileham’s initial question. He said it should not take that long to appoint a programme manager. Disciplinary cases had to be dealt with timeously, and also a large amount of money should not be used to chase the repayment of a much smaller amount of money.

Mr E Mthethwa (ANC) asked if the Department had a model of accountability it could focus on.

Prof N Khubisa (NFP) asked how far the process was to develop participants becoming entrepreneurs through their exposure to the CWP. Was prior learning recognised?

Ms Maluleke (ANC) asked if the CWP was related to the Department of Public Works programmes. Was there any coordination with other departments? Was monitoring done that the participants were doing the work they were supposed to do?

Mr Bhaga (ANC) asked what the value- add was for individual participants. If the recruitment process was not dealt with, it would always create challenges for the programme.

Mr C Matsepe (DA) asked if there was any information that the people working in the programme were regularly changed so that everybody could benefit from the project.

Deputy Minister Nel gave a background to the origins of the CWP saying that it arose from a jobs summit that recognised that the South African economy had a lot of un- and under- employed people in the medium and long term. CWP was an open-ended programme run by the Department and participants worked two days per week for 100 days in the year. CWP was different to the EPWP which was a six to nine-month period of full time employment. The jobs programmes addressed different needs and had different impacts. CWP recognised, for example, that people might not have picked up skills or experience to move on to other jobs. There were other employment creating programmes and an inter-ministerial committee had been created to oversee these public employment programmes. It might assist the Committee to do oversight visits to CWP programmes and to speak to other portfolio committees who had oversight over similar programmes.

Responding to the question of tangible results, the ILO had conducted studies as well as the Centre for Violence and Reconciliation which had conducted studies on the value of the CWP, where it was shown that it had had a real impact.

On the issue of the six-month extension, it was six months from 31 March.

On the issue of the three investigations, he agreed that millions should not be spent chasing cents, but the Department had a zero-tolerance approach to fraud and corruption. A theft, even if only R200, points to systemic vulnerabilities within the programme, therefore it was worthwhile investigating.

In response to Prof Khubisa’s question, the economic impact of the CWP was vital. He used the example of Erasmus near Pretoria where participants had received certificates and used these to access grants and loans.

 Mr Nwaila replied to the question on accountability; there were regular meetings with the EPWP regarding accountability.    

On the question of benefits that accrued at the individual level, Dr Mngadi said that training was a critical secondary objective to ensure that the output of participants was sound and to support them through life skills and financial management skills programmes.

Mr George Seitisho, Acting CWP Programme Manager, said all projects at municipalities were done in consultation with ward councillors and were community driven. The private sector was also involved in partnerships which provided training to the participants. CWP was involved with the Municipal Infrastructure Grant (MIG) and Municipal Infrastructure Support Agent (MISA) to see if participants could do maintenance work for these entities.

Mr Nel said that the filling of posts had been sharply raised with the DG.

The meeting was adjourned
 

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