Department of Public Works & PMTE on their Quarter 2 performance, with Deputy Minister

Public Works and Infrastructure

07 March 2017
Chairperson: Mr B Martins (ANC)
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Meeting Summary

The Deputy Minister of Public Works, the Director-General and officials from the Department of Public Works briefed the Committee on the July-September 2016 performance of the Department of Public Works (DPW) and the Property Management Trading Entity (PMTE). The report focused on the turnaround phases, DPW and PMTE performance information, the way forward, DPW and PMTE financial performance.

The report noted that the DPW had a total of 28 planned targets for Quarter 2. Of the 28 targets: 19 are achieved (68%), 2 are partially (7%), and 7 not achieved (25%). While performance in terms of targets achieved reflects as 0%, progress in terms of the activities related to the targets is noticeable.

In Programme 1 Service Delivery Model – the terms of reference (TOR) and project charter was developed and approved. Bid Spec & Evaluation committees met. The SDM will shape how services are delivered as part of the second phase of the turnaround – Efficiency enhancement. On the Compliance Model - Options analysis for departmental compliance model were done.  On Investigations - 100% (14 of 14) investigations were instituted within 30 days of reported allegations. Payment of Invoices – 94 % of compliant invoices were settled within 30 working days.

In Programme 2 Inter-Governmental Coordination - Three agreements were signed for joint service delivery with provinces and municipalities, 100%. This spans across the three spheres of government for better coordination in areas of interrelated and inter-dependencies.   In terms of the Prestige Policy, on mechanical breakdowns - 141 requests received; 61 were completed within 20 working days. Emergency Breakdowns - 162 requests received; 102 were completed within 4 working days; 57 not completed within 4 working days; 3 cancelled. Prestige - three State events were supported by moveable infrastructure. Two prestige events were planned for the quarter. 

The report noted that in response to underperforming performance measures in Programme 4: Property and Construction Industry Policy and Research an Exco White Paper Task Team was established to oversee the White Paper process. The Task Team adopted a comprehensive framework to (1) reaffirm the scope of the White Paper process; and (2) define essential linkages to facilitate participation by stakeholders. Certain thematic areas have been identified as fundamental to the White Paper process and various experts have been identified for insourcing via secondment or term contracts. Detailed action plans with timeframes have been developed. DPW undertook to develop a Concept Paper to inform the review of the Construction Industry Development Board (CIDB) Act. Consultations with stakeholders to inform the review and enhance the concept paper were undertaken with clients of the CIDB, contractors, and DPW.

PMTE had a total of 24 targets for Quarter 2. Of the 24 targets: 16 are achieved (67%), 4 are partially achieved (16%), and 4 are not achieved (17%). Highlights for PMTE Programme 1: Finance and Supply Chain Management, on the payment of invoices – 91% compliant invoices were settled within 30 days. For the sustainability of its suppliers, the PMTE aims to make payments within the stipulated time frames. On Compliance to Supply Chain Management (SCM) – there was 97.07% reduction in non-compliance to SCM prescripts to a target of 7.5% for the quarter.

In PMTE Programme 3 – Construction Project Management, in terms of projects – 56% (42 of 75) approved infrastructure projects designs – 38% (38 of 100) approved infrastructure projects are ready for tender. 91% (49 of 54) infrastructure sites were handed over for construction. 66% (40 of 61) infrastructure projects were completed within the agreed construction period. 64 % (39 of 61) infrastructure projects were completed within budget. In terms of the Expanded Public Works Programme (EPWP), Work Opportunities within Projects – 4 192 against a target of 4000 work opportunities were created through construction projects.

In PMTE Programme 5: Real Estate Information and Registry, there was 100% achievement on immovable property assets which were updated on the immovable assets register (IAR) for completed infrastructure projects. There was also 100% achievement on the number of provincial immovable assets registers which were assessed for compliance. The figure for this performance measure is consolidated in the Construction performance measure as it applies to capital maintenance executed by Construction.

Members asked about what steps have been taken to deal with the slow spending in goods and services, the expensive housing for ministers and deputy ministers, poor quality of repairs to the parliamentary villages, the discrepancy in the vacancy rate, the total number of senior managers who received performance bonuses, the incentive grant of the EPWP where provinces had a huge increase of 49.5%, and the appointment of 189 data capturers.

Meeting report

The Chairperson welcomed the Deputy Minister of Public Works, accompanied by a delegation from the Department consisting of the Director-General and other senior officials.

Department of Public Works (DPW) Second Quarter Performance 2016/17
Mr Mziwonke Dlabantu, DPW Director-General, outlined the presentation which would look at the turnaround phases, DPW and PMTE performance information, the way forward, DPW and PMTE financial performance.

Deputy Minister Jeremy Cronin said that the purpose of the briefing was to reflect on the 2nd Quarter Performance and Financial information of the Department of Public Works and PMTE in 2016/17 in order for the Portfolio Committee to advise on improving performance.

Mr Imtiaz Fazel, DPW Deputy Director General: Governance, Risk and Compliance, said that the turnaround phases include a seven year turnaround strategy for the Department. These phases are: Stabilisation phase; Efficiency Enhancement phase; and the Sustainability and Growth phase. The phases will lead to transformation and change management within the Department.

Mr Fazel said in DPW has a total of 28 planned targets for the quarter under review. Of the 28 targets: 19 are achieved (68%), 2 are partially (7%), and 7 not achieved (25%). While performance in terms of targets achieved reflects as 0%, progress in terms of the activities related to the targets is noticeable. Where there were challenges with capacity for the White Paper project; the insourcing of expertise in the diverse functions of the Public Works sector was identified. Expert legislative drafting expertise has also been sourced to assist in the development of legislation for CIDB and Built Environment Professions (BEP).

While performance in terms of targets achieved reflects as 0% as per the performance measure, progress in terms of the activities related to the targets is noticeable. For example the policy write up has been concluded and presented to internal governance structures. Additional inputs have been provided.

Mr Fazel said the highlights for Programme 1 on the Service Delivery Model - TORs and project charter was developed and approved. Bid Spec & Evaluation committees met. The SDM will shape how services are delivered as part of the 2nd phase of the turnaround – Efficiency enhancement. On the Compliance Model - Options analysis for departmental compliance model were done.  On Investigations - 100% (14 of 14) Investigations were instituted within 30 days of reported allegations. Payment of Invoices – 94 % of compliant invoices were settled within 30 working days. A Service Delivery Model is a model that seeks to strengthen and enhance an understanding of the value chain regarding the improvement of service delivery and organisational transformation in the public sector. Capacity Building - 100% funded prioritised vacancies filled as per the Recruitment plan. Prioritised vacancies are to be filled within 4 months from the date of advertisement as part of the broader government objective. Anti Fraud and Corruption - 100% reported fraud and corruption misconduct cases were subjected to disciplinary processes (6 cases).

In terms of Programme 2, on Inter-Governmental Coordination - Three agreements were signed for joint service delivery with provinces and municipalities, 100%. This spans across the three spheres of government for better coordination in interrelated areas and interdependencies.   

Mr Fazel said the second quarter report on Public Employment Programmes (PEPs) was completed. In terms of EPWP - 302 NPOs were contracted for the implementation of Non-State Sector (NSS): NPO Programme against a target of 200 for the quarter. Technical Support - 196 against a target of 150 public bodies were provided with technical support.

In the Prestige Policy, on Mechanical Breakdowns - 141 requests received; 61 were completed within 20 working days. Emergency Breakdowns - 162 requests received; 102 were completed within 4 working days; 57 not completed within 4 working days; 3 cancelled. Prestige - three State events were supported by moveable infrastructure. Two prestige events were planned for the quarter. 

The report noted that in response to underperforming performance measures in Programme 4: Property and Construction Industry Policy and Research an Exco White Paper Task Team was established to oversee the White Paper process. The Task Team adopted a comprehensive framework to (1) reaffirm the scope of the White Paper process; and (2) define essential linkages to facilitate participation by stakeholders. Certain thematic areas have been identified as fundamental to the White Paper process and various experts have been identified for insourcing via secondment or term contracts. Detailed action plans with timeframes have been developed.

DPW undertook to develop a Concept Paper to inform the review of the Construction Industry Development Board (CIDB) Act. Consultations with stakeholders to inform the review and enhance the concept paper were undertaken with clients of the CIDB, contractors, and DPW.

The brief to Senior Counsel/ legal drafters was developed and engaged on with Legal Services until terms of reference were agreed upon. The Concept Paper was presented to Exco. The department has sought the services of a legal drafter through the Legal Services Unit. Legal drafters have now been appointed and a concept paper developed with DPW and other stakeholders.

In Programme 5: Prestige Policy a policy on the allocation of residential accommodation to Members of the Executive is being consulted on by the Executive Authority with Cabinet for concurrence.

Property Management Trading Entity (PMTE) Second Quarter Performance 2016/17
Mr Paul Serote, Head: PMTE said that PMTE has a total of 24 targets for the quarter under review. Of the 24 targets: 16 are achieved (67%), 4 are partially achieved (16%), and 4 are not achieved (17%). In terms of the highlights on Programme 1: Finance and Supply Chain Management, on the Payment of Invoices – 91% compliant invoices were settled within 30 days. For the sustainability of its suppliers, the PMTE aims to make payments within the stipulated time frames. On Compliance to SCM – there was 97.07% reduction in non-compliance to SCM prescripts to a target of 7.5% for the quarter. There was a reduction in non-compliance to SCM prescripts. In the Awarding of bids – 55% (target is 60%) - 38 bids were awarded within 56 days out of a total of 68 awards for Quarter 2.

In Programme 2 – Real Estate Investment Management, on the Feasibility studies – 80% (56 of 70) feasibility studies were completed with schedule timeframe. Target for the quarter is set at 80%. Valuations - 80% (70 of 87) valuations were completed within scheduled time frames. Target for the quarter is set at 80%. Assessed building’s performance – 163 of 100 buildings performance were assessed in identified performance areas. The assessment of buildings is to determine operating costs and utilisation at facility level in compliance with GIAMA.

In Programme 3 – Construction Project Management, in terms of Projects – 56% (42 of 75) approved infrastructure projects designs – 38% (38 of 100) approved infrastructure projects are ready for tender. 91% (49 of 54) infrastructure sites were handed over for construction. 66% (40 of 61) infrastructure projects were completed within agreed construction period. 64 % (39 of 61) infrastructure projects were completed within budget. In terms of the EPWP Work Opportunities within Projects – 4 192   against a target of 4 000 work opportunities were created through construction projects.

In Programme 4: Real Estate Management, properties were identified for the purposes of letting out. These properties were advertised and the response rate has been low. The target was set in the absence of a complete policy (due to policy revision). The Property Management Empowerment policy is under review.

In Programme 5: Real Estate Information and Registry, there was 100% achievement on immovable property assets which were updated on the IAR for completed infrastructure projects. There was also 100% achievement on the number of provincial immovable assets registers which were assessed for compliance. The figure for this performance measure is consolidated in the Construction performance measure as it applies to capital maintenance executed by Construction.

Mr Serote said that in terms of Programme 5 highlights projects capitalised and added to IAR – 100% (24 of 24) completed projects were capitalised and added to IAR. Provincial Immovable Asset Register assessed – 2 Provincial Immovable Asset Registers assessed for compliance with IAR criteria (KZN and Gauteng).

In Programme 6: Facilities Management, on Scheduled Maintenance – 90 buildings with scheduled maintenance contracts were in place against a target of 75 buildings. Reduction in Energy consumption - 69 781 556 kWh Reduction in energy consumption for identified property portfolio (target was 62 500 000). There was a reduction in Water Consumption – 1 230 469 kl of 1 025 000kl reduction in water consumption for the identified property portfolio.

Mr Serote said in quarter comparison on average the performance of the DPW and PMTE is improving. Both entities are performing above the average performance level (50%). The DPW and PMTE Overall Performance Achievement for Quarter Two 2016/17 is 68% DPW and 67% PMTE. The combined performance achievement for Quarter Two 2016/17 is 67.3%.

Mr Serote said in terms of responses to underperforming performance measures in Programme 4 the responses for properties advertised (based on the identified properties for letting out) has been low affecting the performance measure on letting out for revenue generation. DPW in future will work with the Estate Agents. The Panel of Estate Agents is to be procured. In terms of leases awarded to Black Owned – A Property Management Empowerment policy is under review. Stakeholder engagement on the Policy is underway and expected to be finalised by 31 March 2017. The policy will enable implementation of a structured transformation programme.

In Programme 5 on unscheduled maintenance – the Department will be measuring the effectiveness of the measures linked to turnaround for specified facilities (Top 300 facilities). The Department is re-focusing from reactive to planned and scheduled maintenance in line with the Facilities Management Strategy. The majority of the breakdowns are linked to critical components (such as lifts, heating, ventilation and air conditioning, boilers). DPW is embarking on comprehensive condition assessment for the purpose of implementing upgrades and on-going maintenance programme for the critical components.

Mr Serote said that in terms of the way forward on SCM Reform they will centralise the supplier database / Appointment of panel of lessors. On ICT Solutions – look at Immovable Asset Management / Lease-in Portal / Condition Assessment.  Real Estate Investment Services – they will fast track the valuations, feasibilities and disposals to achieve set monthly targets. On Construction Projects Management – they will capacitate the branch with key skills / Introducing Infrastructure Delivery Management System (IDMS). Real Estate Management Services – they will develop a leasing framework / revision of lease agreements / standardisation of lease agreements. Facilities management – Top 300 buildings / Develop internal technical skills capacity linked to resuscitation of workshops.

Discussion
Ms D Kohler Barnard (DA) asked in Programme 1, what steps have been taken to deal with slow spending in goods and services which is mainly due to delays in receiving invoices. How many service providers are they looking at here? How many chances does it give service providers before they dispense with their services?

She asked for the total number of senior managers who received performance bonuses, what the cost is to the department, and why the percentage of funded prioritisation is standing at 73%. How many vacancies still need to be filled under Programme 5, which are the positions, when they will be filled, and what the impact is on the department to fulfil its mandate?

Ms Kohler Barnard asked about the incentive grant of the EPWP where provinces had huge increase of 49.5% in normal terms. Which provinces are not complying with the Division of Revenue Act (DORA) provisions and what the impact is on service delivery?

She asked the reason for the appointment of 189 data capturers on a three month contract, is it because they will capture the missing information highlighted by the Auditor-General? And how much of the R9.4m will be spent on those contract workers, have they indeed been absorbed permanently into the department or is just a once off employment?

Ms Kohler Barnard asked in terms of Programme 4 where the Annual Performance Plan (APP) stated that the White Papers of 1997 and 1999 will be reviewed, why have they not? It was stated that the CIBD Act will be reviewed, why has it not been reviewed. The Built Environment Professions Policy (BEPP) will be developed, and it has not been done, why?

Looking at the Prestige Policy, Programme 5 planned to have four prestige policies approved in this quarter, and not a single one has been approved, why?

Ms Kohler Barnard said it was stated in the report that it should take 20 working days to resolve mechanical breakdowns after complaints were lodged. But of 141 requests made, only 61 were completed within 20 days, which meant that 28% of those requests failed, why? It also undertook to deal with emergency breakdowns within four days and 29% of those failed, why?

Ms Kohler Barnard said the Department should be reminded that it agreed in August 2016 to do a presentation on consultants and the Committee has not yet received that presentation.

Ms E Masehela (ANC) said that at least now they have a scheduled maintenance plan in their different departmental buildings which is very good because these were the areas the department was doing very poorly. There had been no maintenance plan for the buildings and in most cases there was chaos. This must spread to all other buildings of the department.

Ms S Kopane (DA) said on Programme 3: EPWP, they were told that about 302 Non-Governmental Organizations (NGOs) were contracted for the implementation of the non-state sector, and it seems they have done very well and have reached their target with 151%. She asked which provinces these non profit organisations (NPOs) were contracted to and which municipalities.

Ms Kopane asked for clarity on the Public Works White Paper where the target was zero, performance was not stable and they were in progress of doing something. DPW indicated that there were challenges with capacity for the development of the White Paper and were going to outsource the expertise. There was no timeframe set for when they are going to do so. She asked whether the department is going to hire outside consultants to develop this White Paper, how many of the consultants will be needed to help DPW in doing this, and from which registered companies outside government will these consultants be sourced.

She asked for clarity on slide 43 and slide 45. Slide 43 just gives a summary expenditure per economic classification, and there is a percentage of the total budget. But if they check the total budget allocation per current items in slide 45 there is no correlation. For example, under compensation of employees it clearly indicates 12%, but on the chart in the report it is not indicated. There is no correlation in terms of numbers as indicated in slide 43. Why there is a disparity between these two slides?

Mr F Adams (ANC) said there was some improvement from DPW’s side. He asked what measures are there for acquiring ministers and deputy ministers’ houses in terms of PMTE because some the houses are acquired at exorbitant prices and the repairs in some these houses are expensive. For example, DPW spends between R25m and R30m to buy a house, and then spends between R10m and R25m for the upgrade and repairs towards a house. One can build many more houses with that money.

The Chairperson interjected that it will assist DPW if Mr Adams can identify provide relevant information on the particular area so that it does not sound like a generalisation but something that could be looked at by DPW specifically.

Mr Adams said that DPW knows because they have bought houses in areas such as Welgemoed in Cape Town area. They have bought those houses at exorbitant prices for ministers and deputy minsters to live in. There is also a luxury block of flats which is being renovated, bought at high price. Also money is spent on furniture for those houses which is way above normal standards of living. Therefore, people on the ground feel it is unnecessary expenditure.

Mr Adams asked what the R9.6m was for that was given to the Parliamentary Villages Board because MPs are complaining that the work of the contractors was of sub-standard in the parliamentary villages. The leasing agencies were complaining that the money they get from DPW did not allow for quality contractors for the work in the parliamentary villages. He asked who does the final checks when these contractors have finished their work in the houses where MPs live.

Mr Dlabantu, DPW Director General, replied to the last question that they have measures for evaluating the improvements from a proper cost benefit and evaluation perspective. This issue is based on the report that was done on the huge costs that were allocated for the improvements that occurred in 2011/12, which were the subject of a Special Investigating Unit (SIU) investigation. He will check with the DDG whether that report has been finalised and since they are going through the SIU investigation. They are having a discussion at the end of this month to look at which investigations are finalised and which ones are not, and what the proposals for those are for recovery if there was overcharging.

But some of the issues they have discovered there is that generally most of these houses are very old, the infrastructure is decaying, and they are also heritage assets. In cases where there were problems of procurement, the quality surveyor found that there was overcharging which they are going to deal with. What they are doing with assets is they have done an analysis which states that if one has a house with a market value of R5m, how much they could spend to improve it even if that house is over 50 years. What do they do in this regard? Do they apply for demolition and reconstruction, and what will be the implications be of that? In some cases they have to face dealing with the communities around those houses, who say they are changing the face of that particular area.

He has not made a proposal to the Minister and the Deputy Minister on the houses. It has been a thought as an instruction was given for example in Pretoria where they are saying if they have sufficient land in the vicinity of the area were ministerial houses are situated, what further development could be done to consolidate all the ministerial houses within that space. This is to save costs for security and other services. Then they can allow releasing some of the police to rather do security services on a proper estate which will use technology and the intelligence that is available to deal with those issues. Therefore, they will be able to concentrate on the safety of the Ministers by providing proper accommodation affordable to DPW.

Cape Town is a bit tricky because it is an old area, it is not easy to consolidate but there are areas they could consolidate and do the same as in Pretoria, and their teams is looking at that and will see what they can do regarding those houses. But at the moment they have not heard and it will be extremely difficult for anyone to develop any house in the kind of proportion they have done before. For example, DPW will have a house at a market value of R12m which was the latest offer from University of Cape Town to buy the house. They were about to spend R25m for the house, but when they discovered this they reduced it to R19m. But that would have included some additions to structure and issues related to the underground infrastructure.

What they are generally ignoring in South Africa is a full analysis of what is wrong underground because of the ageing of the infrastructure. It is serious because if they could see the floods in Johannesburg and Pretoria where there are storms, what is happening underground is being ignored consistently, let alone the fact that sometimes they do not maintain the storm water pipes to remove the dirt that is there. The reality is that these places have grown over a period of time without the concomitant growth and improvement in underground infrastructure, and one of these days they are going to find an explosion of that process. The last calculations done were in tens of billions of rands and that does not apply to Public Works only.

The Director General said the flats where Directors General and Deputy Ministers are generally accommodated, is very old. Every time he arrives at that flat different Directors General will come to him to complain about that building. And if they do not make those investments they are postponing the costs because they escalate as time goes by. At one point a ceiling fell in; the lifts were dangerous and the infrastructure was clearly problematic. In the rainy season in Cape Town the underground parking area has problems. So, they had to deal with the repair and renovation of that building at high cost. But some of these flats are four bedroom flats with large inefficient space. They renovators were told to utilise the big space because government has grown. There use that space to reconfigure the whole area and see what additional units they could put there.

The Chairperson said it is necessary that the Department should respond quickly to such problems otherwise the impression will look as if it is wasteful expenditure.

Mr Adams said that some of the penthouses in Muizenburg which are meant for the accommodation of Directors General, have been empty since the start of the term.

The DG said they have allocated some people to those penthouses. They know that these penthouses were unpopular, but the acquisition of these was in 2010/11. Their unpopularity relates to their distance from Parliament. They have to wake up at five to make it in time to Parliament. There is an over burdening of the traffic from Muizenburg to Cape Town. Again they had to ensure they maximise that space. The plan is that by the time the renovations are done, they will be in a position to start disposing of those and look at places such as in Mouille Point which is not 100% government owned. They own sectional title arrangements. The idea is to fully own such places and still keep the management arrangement so the place is well looked after.

Mr Stanley Henderson, Deputy Director-General: EPWP, said that at the end of January the biggest underperforming province in terms of the incentive grant is Mpumalanga at 32% and 41% for municipalities. The data capturers were appointed to capture data costs in all sectors of the EPWP, and they are not being absorbed permanently into DPW.

On the NPOs, Mr Henderson said that it was an open process where NPOs submitted applications to participate in the EPWP. Unfortunately, he has no breakdown of NPO costs with him but will forward it to the Committee Secretary in due course.

Mr Clive Mtshisa, Deputy Director General: Corporate Services, replied about huge vacancy rate, saying  a report that has been submitted to Parliament which explains this. The Department of Public Service and Administration (DPSA) wrote to DPW to ask why there was such a huge vacancy rate. DPW explained that they have split the PMTE budget allocation from the budget vote of DPW. From an HR point of view that exercise can only happen when they have started implementing the new organisation structure. HR processes are slower than the financial processes. Therefore, what happens is that everybody is kept under the main vote and is employed under the main vote. They then second the personnel to PMTE and claim the money from PMTE.

Once they begin to implement the new internal organisational structure on 1 April 2017, they will then do a complete HR split because they are currently using the old structure. The current vacancy rate on the main vote is actually 9.2% with 138 vacanices. The total number of people employed is 1 663. For PMTE, the total number of posts filled is 4 677 and the vacancies across various branches is 942, with a vacancy rate of 16.07%. So, that is the true picture. They will see the same picture when they look at the annual reports of previous years. This information is drawn from Vulindlela, the Government HR database.

The Chairperson said it will be helpful if DPW could forward that information on DPW vacancies.

Ms Kohler-Barnard said if they added the two figures together it was 23%. They were looking at a figure of 75%. That does not come anywhere near that figure, and it is confusing.

Mr Mtshisa agreed that they are also confused by that figure which came from the report of the Public Service Commission (PSC) which is available to the National Assembly. That is the figure PSC gave which shocked DPW as well. But if they can check their budget allocation and the people they have employed and split that up then the correct vacancy rate of DPW will appear. There is no way their budget could relate to a 27% employment rate.

In reply to Ms Kohler-Barnard asking if DPW has contacted the PSC to check on this, Mr Mtshisa said they are going to do that.

Ms Mandisa Fatyela-Lindie, Acting DDG: Policy, replied that the White Paper delays are because DPW does not have internal capacity to draft the White Paper. They will be insourcing various experts to draft the White Paper according to the identified thematic areas of: Programme Management; Immovable Asset Management; Public Employment and Skills Development; Construction and Property Sectors Regulatory Environment; Constitutional Law on the concurrent Mandates of Public Works; and Construction Design and Project Management. Under each thematic area there are sub-layers that will be taken care of.

Ms Fatyela-Lindie said that the review of the CIBD Act is underway. The drafts will be done by the end of this month. The review of the BEPP is captured as such but they have changed that to the review of the CIDB Act. When they made the changes, they could not change the APP in terms of Treasury regulations. However, DPW has the right which was approved by Parliament, but they must provide a narrative for any change. But the review of both Acts is underway and they can be presented in the next financial year. The timelines were presented two weeks ago to the Portfolio Committee. The detailed map process of those timelines has been submitted to the Committee researchers and therefore is accessible.

Mr Mtshisa replied that they have not paid any bonuses to DPW executives because the turnaround process has not been completed. At SMS level they are currently busy with directors and chief directors. They have not dealt with bonus of the executives as yet.

Mr Mtshisa replied that the underspending in Programme 1 on goods and services the issue is not about delivery but rather about timing when they started the process of engaging service providers through a tender as well as in terms of quotations.

Mr Mtshisa replied they are awaiting an invitation to do the presentation on consultants to the Committee and if invited, they will come and do it.

Mr Mtshisa explained the perceived inconsistencies in slides 43 and 45. They are not inconsistent because they measure different things. In slide 43 as correctly pointed out by Ms Kopane these are the percentages of the total budget, which comes to 12% of compensation, 6% of goods and services as a percentage of the total budget allocation of R11.8bn. Slide 45 is the calculation of the percentage of the current payments of the different elements that make up current payments. That is why compensation will be 16.7% or 17% of current payments.

Mr Mtshisa said on the budget allocation to Parliamentary Villages was not for maintenance r houses, but for the transportation of MPs to and from Parliament.

The Chairperson thanked the Deputy Minister and the DPW delegation and the Committee is looking forward to their next engagement. The information given to the Committee will go a long way in ironing out all the challenges DPW was dealing

The meeting was adjourned.

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