Civilian Secretariat for Police & IPID 2016/17 Annual Reports

Meeting report

Opening remarks

The Chairperson welcomed members, as well as the delegation from the Civilian Secretariat for Police. After a discussion with Police management and the Provincial Commissioner of the Western Cape the previous day, a new station commander had been appointed to the Marikana area of Phillipi-East. Urgent steps would be necessary to stabilise the situation in Phillipi-East – including the introduction of more South African Police Service (SAPS) members - after a protracted period of violence. Moreover, a recent statement by the Acting-Head of the Directorate for Priority Crime Investigation (DPCI) confirmed that a SAPS member from Mpumalanga had been arrested on corruption charges worth R500 000. Considering the elite status of the DPCI, the current level of criminality within the SAPS presents a fundamental challenge to the committee. The Committee should summon the DPCI integrity unit, as well as the anti-corruption unit within the SAPS to respond to the allegations.

Mr Alvin Rapea, Acting-Civilian Secretariat for Police, introduced the delegation from the Civilian Secretariat, but noted that the Chairperson of the internal audit committee was not in attendance, but would appear before the Committee at a later date.

The Chairperson stated that the purpose of the session would be to highlight the approach of the Civilian Secretariat with reference to the report of the AGSA. Specifically, the internal controls and performance information were of importance to the committee. He stated that the Civilian Secretariat’s unqualified audit opinion had generated optimism for a turnaround at the department. With this considered, the AGSA’s findings should be the guiding principles of the hearing.

Civilian Secretariat for Police (CSP) on its Annual Report for 2016/17
Mr Rapea thanked the Chairperson. He noted that the various Unit-Heads would present the relevant sections of the Civilian Secretariat’s presentation.

In terms of its overall performance, the Civilian Secretariat achieved 80 % of its strategic goals. Key achievements include improved performance indicators for financial administration; overall improvement in finance and programme management with the stabilization of the top structure of the Secretariat; and the implementation of a turnaround strategy to address the findings of the 2015/16 Auditor-General of South Africa (AGSA) report.

The Civilian Secretariat reported 119 employees out of a total of 151 funded posts, reflecting a vacancy rate of 21.19 percent. Of the total employees, 52.1 percent were females and 47.9 percent males. The Secretariat’s vacancy rate has been reduced since the end of the 2016/17 year, and currently stands at around 4 percent.

In terms of skills development interventions, the Secretariat reported two categories: programmes accredited by the Skills Education Training Authorities (SETA) and programmes not accredited by SETA. In terms of participation during the period, 62 female members attended SETA programmes, while 38 attended non-accredited programmes. 28 male members attended SETA programmes during the period, while 22 attended non-accredited programmes.

The Civilian Secretariat reported turnover rate of 5.9 percent for the period 2016/17, of which 24.8 percent was on the senior management level. Of the 7 departures during the period, 4 members resigned, while 3 transferred to other departments. In terms of the employment equity profile, 52 percent of senior management were African males, 25 percent African females, 7 percent Coloured males, 4 percent Coloured females, 4 percent Asian males, 4 percent Asian females, and 4 percent white males.

Mr M Mashibini, Chief Director: Corporate Services, CSP, noted that the Secretariat does not currently employ any persons with disabilities, but has taken steps in its procurement process to achieve its target of 2 percent. Moreover, the Secretariat had appealed to its staff to declare any disabilities at their own discretion; however the building from which it currently operates is not sufficiently equipped for persons with disabilities.

For the intersectional coordination and strategic partnerships programme, the Civilian Secretariat achieved 17 percent of its strategic goals for 2016/17. Mr S Ntuli, Chief Director: Intersectional Coordination and Strategic Partnerships, CSP, cited instability in the Civilian Secretariat’s leadership, a lack of organisational frameworks, a lack of individual performance due to the aforementioned leadership vacuum, and funding issues as the reasons for variance from its targets. The Civilian Secretariat failed to achieve any of its targeted 30 Memorandum of Understanding (MOU’s) for the period. Moreover, the Secretariat had failed to implement its target of one anti-crime campaigns for 2016/17. Of the targeted 20 reports on police stations implementing school safety protocol, all 20 reports had been released. Of the 6 targeted public participation forums, only 3 reports were submitted during the period.

Mr Rapea stated that a major challenge in this programme was that some of the reports on the public participation forums were released after the end of the 2016/17 financial year, while some were simply not delivered. As the Civilian Secretariat could not produce evidence on these forums, the AGSA could not acknowledge them in its performance review. This was a matter of discipline, and that the Civilian Secretariat was currently in the process of conducting performance appraisals on its staff.

The Chairperson stated that consequence-management was a major problem for the Committee. Source documents and proof were critical for performance reviews, in the interest of reliability and completeness of information. Were there steps taken to address the staff that deviated from the guidelines, and if so, what were the outcomes? He stated that the leadership needed to take responsibility for this issue.

Mr Rapea assured the chairperson that there would be consequences for the relevant staff by the end of October 2017.

The Chairperson noted that the AGSA had asserted that the Civilian Secretariat’s response to the issue was too slow. Is the matter being addressed or is the Secretariat simply awaiting the next cycle? He suggested that management be proactive in dealing with non-compliance in the department.

Mr Rapea stated that the Civilian Secretariat had developed a new system in the current financial year whereby the Head of Integrity and Governance will follow up on deliverables before the end of each quarter.

The Chairperson stated that many of the deliverables not met were in fact repeat findings. As the management of the Civilian Secretariat, these deliverables must be addressed otherwise performance will continue to suffer.

For the legislation and policy development programme, Ms B Omar, Chief Director: Policy and Research, CSP, reported that 86 percent of strategic goals had been achieved for the period 2016/17. Key achievements include the adoption of the White Paper on Policing and the White Paper on Safety and Security by Cabinet in 2016; the finalisation of the research project on the Analysis of Police Resource Allocation; the development of a discussion document on the establishment of a National Police Board; the finalisation and approval of a framework for a Single Police Service; the submission to the Minister of a policy on Reducing Barriers to Reporting Sexual Offences and Domestic Violence; an analysis of Safety Audits; the approval by Cabinet of the Critical Infrastructure Protection Bill; and the approval and proglumation of the revised Civilian Secretariat for Police Services Regulations.

For the monitoring and evaluation programme, Mr. T Ramaru, Chief Director: Monitoring and Evaluation, CSP, reported that 92 percent of strategic goals had been achieved for the period 2016/17. In terms of key achievements, the SAPS Budget and Programme Performance Assessment Report had been finalised; the Police Station Service Delivery Trends Analysis Report had been compiled; the DVA Report on key implementation and compliance trends had been presented to Parliament; and the Independent Police Investigations Directorate (IPID) recommendations report had been produced. In terms of the reasons for variance from targets, he cited delayed submissions by provinces in processing due to capacity challenges, and instability in leadership after the departure of the Civilian Secretariat’s Chief Director.

Mr T Nkojoana, Chief Financial Officer (CFO), CSP, reported that the total budget for the Civilian Secretariat was R110.6 million for the 2016/17 financial year. As of 31 March 2017, the Civilian Secretariat had exhausted 89.9 percent of its total budget, with the administration programme spending 94.4 percent of its budget. The administration programme accounted for around 40 percent of total expenditure as a result of centralized payments for office stationary, vehicles and annualized payments to the SETA’s within this programme. The intersectional coordination and strategic partnerships programme spent 92.5 percent, legislation and policy development spent 84.4 percent, and civil oversight, monitoring and evaluation spending 83.8 percent of their respective budgets. 

In the financial year 2015/16, the Civilian Secretariat had overspent its budget of R113.1 million by R4.4 million (3.9 percent). Mr Nkojoana noted that during this period, the Civilian Secretariat had paid legal fees in assisting the Ministry, and that SAPS had refused to reimburse the Secretariat on these costs incurred.

For the year 2016/17, the Civilian Secretariat budgeted R79.1 million for compensation of employees, of which only R66.2 million (83.8 percent) was expenditure incurred. Underspending was attributed to vacant funded posts which had not been filled by the conclusion of the financial year. An amount of R29.3 million was budgeted for goods and services, of which R31.9 million was incurred, reflecting over-expenditure of 8.8 percent. An amount of R311 000 was spent on Transfers and Subsidies, reflecting underspending of 41.1 percent. This underspending relates to unpaid transfers to SASSETA, as the registration process had not been finalized by end of the financial year. An amount of R859 000 was spent on Payments for Capital Assets, reflecting underspending of 43.1 percent.

In terms of the cost-drivers for expenditure, Mr. Nkojoana noted that the budgets for the top six items had been reduced from the 2015/16 financial year, and totaled R24.5 million for the 2016/17 year. For the period, expenditure on travel and subsistence was R10.3 million; expenditure on computer services was R6.2 million; expenditure on legal fees was R2.3 million; expenditure on advertising was R2 million; expenditure on External Audit costs was R1.9 million, and expenditure on Communication services was R1.5 million.

Mr. Nkojoana noted that the Civilian Secretariat had received an Unqualified audit opinion for the 2016/17 year, after receiving a Qualified audit opinion in the previous two years. The primary matters of concern pertained to material underspending by the department as a result of vacant posts; and the restatement of the 2015/16 qualification item (overspending on receivables) which resulted in over-expenditure of R4.4 million for the 2016/17 period.

Discussion
The Chairperson stated that the Committee acknowledged the improvement in performance since the commencement of the Civilian Secretariat. In terms of key controls, the Secretariat obtained 4 out of 6, and for performance management, it obtained 6 out of 14. Although these positive results were welcomed by the committee, the Civilian Secretariat had started from a low base, and that the next step would be to obtain a clean audit opinion. To this extent, the Civilian Secretariat should set the standard for the SAPS in terms of performance. In terms of the comments made by the AGSA, what was the frequency of the Secretariat’s interactions with the AGSA? In terms of leadership, he highlighted the ineffective monitoring of action plans to address recommendations of internal and external auditors. If the Civilian Secretariat chooses to only address these issues now, these issues will only become more difficult to address. In terms of the institution’s viability as an institution, he noted that the Civilian Secretariat had moved from “red” to “green”, however does it have the necessary capacity to effectively fulfill its mandate?

Ms D Kohler-Barnard (DA) stated that the unqualified audit report was welcomed, however considering the challenges faced by the Civilian Secretariat, the Department was lucky to achieve this. There were major concerns in relation to financial and strategic management. In terms of the internal control deficiencies highlighted by the AGSA, it is apparent that the Civilian Secretariat had failed to set indicators and targets. Considering the level of expertise at the Department, it was surprising that this was not done. In terms of the AGSA’s findings in terms of procurement and contract management, she asserted that the Civilian Secretariat was picking and choosing bidders who did not win the bids. This amounted to corruption, and that the Department was fortunate not to be in court considering how often this takes place. Is the Civilian Secretariat currently being sued? Was this issue acknowledged during the internal audit process? Does the internal audit team have the necessary capacity to highlight this issue? In terms of consequence management, it appeared as though many issues were simply ignored, or “swept under the carpet.” Where is the consequence management? Have there been any disciplinary hearings?

Ms M Molebatsi (ANC) asked how the Civilian Secretariat plans to improve the filling of vacant positions. How will the department improve in terms of the monitoring of action plans? She noted that in the presentation, “Asians” are referred to as distinct racial group on one slide, however, on a different slide, “Asians” form part of another category. What is the reason for this? Can the Civilian Secretariat elaborate on the instability in its leadership? How does it plan to rectify this issue? With reference to the AGSA’s findings on procurement and contract management, how will the Civilian Secretariat’s procurement framework be rectified to ensure a fair bidding process?

Mr Z Mbhele (DA) stated that the reported vacancy rate of 21 percent was concerning, considering the benchmarked vacancy rate of 10 percent recommended by the National Treasury. He noted that in the Civilian Secretariat’s Annual Report, there is a reference to difficulties in filling positions due to withdrawal of candidature. Are there structural budget constraints in this regard? Are cost-containment pressures preventing the filling of these posts? Will this continue to be a problem in the foreseeable future? On the issue of procurement and contract management, there is a suggestion that a competitive bidding process was not followed. On the implementation of the framework for the White Paper document on Safety and Security, has a consultant been appointed from the public hearings process? Was this appointment compliance with procurement procedures? Who is the consultant?

Ms M Mmola (ANC) made reference to the 32 vacant posts reported by the Civilian Secretariat. When will these posts be filled? In terms of the number of females in senior management positions, she stated that 32 percent was not sufficient. In terms of the reasons for variances from targets, specifically with reference to instability at the leadership level and the lack of tracking of individual performances, can the Civilian Secretariat elaborate more on this? When will the Head of the Civilian Secretariat be appointed?

Mr L Ramatlakane (ANC) congratulated the Civilian Secretariat on its unqualified audit status. This result could be a stepping-stone to a clean audit status. Is senior management happy with the structure being created, considering the Secretariat’s mandate? Does the structure need to be reviewed? He noted that the AGSA had raised issues on the incompleteness of disclosures, the issue of tangible assets and accruals. He expressed concern about the usefulness of the indicators employed by the Civilian Secretariat. Are these indicators promoting compliance with legislation? In terms of financial management, he made reference to SAPS refusal to reimburse the Civilian Secretariat with R4.4 million. In terms of the Public Finance Management Act (PFMA), how will this payment be accounted for? Will it be written off as bad debt? In terms of the Civilian Secretariat’s underspending of 10 percent, which was attributed to unfilled vacant posts, could be department elaborate further on this, specifically on the position of the Chief Director? How many other key positions have not yet been filled? Are these positions necessary, or are they “built-in fat” in the structure? What percentage of expenditure is accounted for by consultants?

The Chairperson noted that one of the Civilian Secretariat’s core mandates was to provide research and support for the Minister of Police. Considering the research unit that exists within the SAPS, is the Civilian Secretariat able to provide useful and innovative support to the executive on a consistent basis? For example, in Brazil, there is a proposal for a blanket amnesty for firearm owners. The Committee is well aware of the SAPS’ approach to research, is there a different approach being adopted by the Civilian Secretariat? In terms of the model of policing, he highlighted the difference between the urban and rural models. Is the department looking at other jurisdictions to develop innovative proposals? Or is this duty left to the SAPS? In terms of the Civilian Secretariat’s mandate, it must be the leader in this regard. Is this happening? If not, what is required?

Addressing the issue of weak internal controls and ineffective monitoring of action plans, Mr Nkojoana stated that in the finance department over the previous two years, the Civilian Secretariat had experienced problems relating to accruals. The AGSA had also highlighted the issue of material underspending as a result of having to restate its programmes during the 2016/17 financial year. There was an attempt to strengthen internal controls; however this had not been completed before the conclusion of the year under review. In terms of procurement and contract management processes, he stated that the Civilian Secretariat did not deal with big contracts. He stated that procurement is mainly done on a quotation basis, and that the central procurement database had only been implemented in the current financial year. When suppliers submit quotations, they are required to include supporting documents, including BEE certificates. In many cases, the Civilian Secretariat had received certificates that were uncertified, invalid or expired, therefore the department has no choice but to disqualify these suppliers.

Ms Molebatsi requested clarity on the statement that the Civilian Secretariat’s contracts were not big. What is meant by this?

Ms Kohler-Barnard inquired as to whether the AGSA was not aware of the act of “skipping people” in the tender process. Is the AGSA misinforming the committee? Why did the Civilian Secretariat not have this conversation with the AGSA?

Mr Nkojoana clarified that the Civilian Secretariat does not issue many tenders, and has in fact issued no “tenders” in the financial year under review. Procurements during the period were done by quotations, and were under the threshold of R500 000. The AGSA’s view was that the Civilian Secretariat should have verified the information of the companies that provided the invalid certificates against its suppler database, which the department had not done. Since the AGSA’s recommendation, this practice has been adopted by the Civilian Secretariat.

Mr Ramatlakane stated that it is ultimately senior management that decides on procurement. How many quotations under R500 000 did the Civilian Secretariat have in the year under review? Although these contracts are not classified as “tenders”, the department is still required to rotate its roster of service providers. He noted that some departments have adopted the practice of giving quotations less than R500 000 in order to circumvent regulations. Is there a rotation in the roster of service providers at the Civilian Secretariat?

Ms Mmola inquired as to whether the quotations mentioned in the AGSA report were less than R500 000.

Ms Omar stated that the Civilian Secretariat had released two supply-chain specifications for the year under review, namely the Analysis of Police Resource Allocation project and the Safety Audit project. The quotations went onto the central database of the National Treasury, and the proposals were subsequently sent to a variety of companies and universities, including private security companies. The proposals from such companies were coherent for the Safety Audit specifications, but were not coherent with what the department needed for the Analysis of Police Allocation project. For this reason, the Civilian Secretariat drafted new specifications with quotations in excess of R500 000 as of January 2017, while the reports were due on in March. Therefore, as opposed to advertising the tender, the department decided to it in-house the project instead. She noted that the department was satisfied with a proposal from University of Cape Town; however they could not award it, as they would be “disadvantaging” private security firms and violating supply-chain management procedures. The proposals received from private security companies were deemed to be unsuitable for the projects as they were under-qualified.

Mr Rapea noted that the Government Printing Works (GPW) did not provide the Secretariat with the correct BEE information, despite the GPW offering the lowest cost and producing excellent work. The Civilian Secretariat has since awarded the GPW with a tender to do all the department’s printing for three years.

Ms Kohler-Barnard asked how it was possible that GPW did not have a BEE certificate.

Mr Nkojoana stated that there had been two instances where the Civilian Secretariat had awarded contracts to institutions without the correct BEE credentials. The department’s system on rotation of suppliers ensures that service providers are eliminated in the next round to ensure competition amongst bidders. On the issue of SAPS refusing to pay the Civilian Secretariat’s legal fees, the cost in its entirety was in fact R10 million, of which the SAPS accepted to pay R6 million. It was the Secretariat’s understanding that the full legal costs were payable by the SAPS. He stated that the Civilian Secretariat had the right to protect its legislation and therefore paid the outstanding amount. This decision is reflected in the over-expenditure in the 2015/16 financial year. In terms of the underspending in compensation of employees, he stated that many of the vacant posts during the 2016/17 year were critical positions such as CFO, senior management and ICT professionals. Some of these posts had only recently been approved by the Minister of Police despite being budgeted for.

Mr W Basson, Director: Strategic Planning, CSP, stated that the Civilian Secretariat had taken note of the points raised by the AGSA, specifically regarding performance indicators. Another issue flagged by the AGSA report was the Civilian Secretariat’s programme 2: intersectional coordination and strategic partnerships. The Secretariat faced challenges relating to the measurability of performance indicators in drafting its Annual Performance Plan (APP) for 2018/19.

Mr Mashibini noted that on 1 April 2016, the number of approved posts at the Civilian Secretariat was 121, at which time the department had only 14 vacant posts, reflecting a vacancy rate of 12 percent. The department was in the process of filling these posts, until the Minister of Police approved 30 new posts in October 2016, increasing the number of funded posts to 151. Prior to this, the department had a vacancy rate of 3 percent. Of the 32 vacant posts reported in the presentation, today only 7 remain vacant. The Civilian Secretariat did not include this information in the presentation as it did not pertain to the year under review. Of these remaining posts, the department has agreed that not all these positions need to be filled, however there is an intention to fill 4 of the remaining 7. Most spending in terms of vacancies for the year under review was a result of the additional posts approved since October 2016. The Civilian Secretariat currently has 143 employees compared to 119 at the beginning of the financial year. Addressing Mr Ramatlakane’s question on the Secretariat’s satisfaction with the department’s current structure, he stated that the current structure had been approved by the Minister in October 2016, as well as the former Minister in 2012. The Civilian Secretariat awaits the outcome of the White Paper on Policing to ascertain whether there is a need to revise its current structure to adjust to the new mandate. There is work being done reviewing the current structure and a business model has been developed, as required by the Department of Public Service and Administration (DPSA). The Secretariat has written a letter to the Minister regarding the implementation of restructuring, and there are plans to expand the staff compliment to 229, with National Treasury’s approval. On the issue of the lack of women in senior management positions, the Secretariat has taken the decision that all remaining senior management vacancies will be reserved for women.

Mr Ntuli stated that during the year under review, instability at the senior management level resulted in non-performance at the individual level. The Civilian Secretariat consists of four sub-units, each headed by a Director. In the absence of a standing Chief Director, a sub-unit Director must be appointed to act as standing Director. The sub-unit Director must therefore also be appointed, causing a lack of accountability in the sub-unit level. Although staff did complete the programme, there was a “sluggishness” in reporting, resulting in the information not coming forward for assessment. When yet another Acting sub-unit Director was appointed, the situation was worsened, and there was an element of self-sabotage due to the lack of accountability.

Mr Rapea stated that ill-discipline in programme 2: intersectional coordination and strategic partnerships meant that some reports were not submitted on time. Reports that are not finalised on time were simply thrown away. He stated that Mr Ntuli had a big task to re-instill discipline in the sub-unit.

The Chairperson stated that there were certain qualities expected from a senior manager in the public service. The Civilian Secretariat should have the right Directors to handle the process, particularly simple tasks such as submitting reports.

Ms Molebatsi stated that the “sluggishness” referred to by Mr Ntuli calls for consequence management.

Mr Rapea stated that some of the Directors at the Civilian Secretariat were not up to Director level in terms of capacity and quality. He stated that the department’s history highlights this fact, as it was used as a “dumping area” in the past. The Civilian Secretariat has since stabilized the situation with the appointment of a Chief Director, however he acknowledged that consequence management must take place.

Ms Kohler-Barnard asked how these individuals became Directors despite not having the necessary qualifications. Who appointed these people?

Mr Rapea stated that prior to 2014, the Civilian Secretariat formed part of the SAPS. When the department became a separate entity, various people came from other places to join the Civilian Secretariat. He stated that Ministerial changes since then also forced the movement of staff. Mr Rapea noted that he was the third accounting officer at the Civilian Secretariat since 2013, following his appointment in December 2016. Since then, there has been a turnaround at the department.

The Chairperson stated that considering the Civilian Secretariat’s special role in informing the Ministry and the Executive, it was critical that the department has the right people in key positions.

Ms Omar stated that there had been a consultant appointed to oversee the White Paper on Safety and Security, namely Ms Melanie Ludmore. Ms. Ludmore had been appointed by the German company GIZ, with whom the Civilian Secretariat has an MOU for research purposes. During the development of the White Paper, Ms Ludmore identified gaps in the local level implementation in terms of accountability. Following the completion of the White Paper, the contract ended. Prior to this, Ms Ludmore had been commissioned to conduct an IGR study with the Secretariat, therefore for the purpose of continuity, GIZ decided to assign Ms. Ludmore to the White Paper on Safety and Security. There was no procurement process in contracting the work of Ms Ludmore. In terms of the Civilian Secretariat’s capacity to advise the Minister, Ms Omar noted that the Minister has requested a lot of research since his appointment in April, specifically Ad Hoc research. The department tends to work in a structured manner, consistent with the APP, but is flexible enough to attend to the Minister’s wishes. She stated that she was satisfied with the level of skills and capacity in the legal research programme, despite struggling with the additional workload. She assured the committee that the legal research programme was sufficiently capacitated in this regard.

The Chairperson inquired as to the Civilian Secretariat’s synergy with the SAPS. He stated that upon the appointment of the previous Acting National Commissioner, the SAPS have decided to go “full steam ahead” with a variety of research-related projects. He stated that the development of new policing models and innovative policy suggestions should come from outside the SAPS, specifically from the Civilian Secretariat.

Mr Mbele asked if there were any cost implications for the Secretariat from the consultancy contract with GIZ.

Ms Omar stated that the only costs she was aware of were for flights and accommodation, which had been agreed upon.

Ms Kohler-Barnard stated that if the Civilian Secretariat has inherited staff that are incapable of doing their jobs, why have there been no incapacity hearings to terminate the employment of these individuals? She stated that retaining these individuals was a waste of time and taxpayer’s money. What process has been followed to get rid of these individuals? If the Minister of Police is pressuring the Secretariat in this regard, the committee must be informed.

Ms Omar stated that the Civilian Secretariat had a good working relationship with Major General Zulu of the SAPS. The department had met with the SAPS to discuss the issue of synergy, and the Civilian Secretariat does not feel threatened by the work being done by the SAPS. She stated that the SAPS research was primarily concerned with strategic-level research and operational command center projects. The SAPS are also working on the Policing Model using the White Papers, which the Secretariat had been involved with. She added that the department does not work as closely with SAPS as it should, however it was necessary to retain a level of independence at the Civilian Secretariat.

The Chairperson asked whether it was possible to have two papers on how to police informal settlements on the Minister’s table?

Ms Omar stated that this was possible.

On the question pertaining to the Civilian Secretariat’s interactions with the AGSA, Mr Rapea stated that he could not recall how many encounters he had, and that the chairperson of the internal audit committee was better equipped to answer the question. He noted that where the AGSA had identified challenges, the Civilian Secretariat provided an open door to listen to these concerns.

The Chairperson asked whether there was an interaction, or if this interaction was delegated to another staff member.

Mr Mdau, member of the audit committee at the Civilian Secretariat, stated that the audit committee met on a weekly basis to review the reports compiled by the internal auditor. He stated that this practice was effective in creating a coherent agenda for both senior management and the audit committee.

Mr Nkojoana stated that during the auditing period, the audit committee met on a weekly basis.

Mr Rapea stated that the department had insufficient capacity in terms of its internal auditing team, and that this issue had been raised by the audit committee. This was part of the larger issue that the department has insufficient capacity throughout. He expressed his dissatisfaction with the current structure of the department, stating that this prevents the Civilian Secretariat from fulfilling its mandates. He made reference to the recent project of conducting a budget analysis of the SAPS, stating that the department did not have the necessary skills or resources to undertake this project. The Civilian Secretariat awaits the approval of its new structure by the Minister and the DPSA, however the process is underway. On the issue of consequence management, Mr Rapea stated that it was necessary to give people an opportunity to prove their value to the department, considering the Secretariat’s relatively recent appointment in December 2016. Furthermore, dismissals on an unfair basis may lead to legal action against the Secretariat. He stated that there was no pressure from the Minister in terms of how to manage his role as the accounting officer. In terms of the capacity of the internal audit committee, he noted that the committee has had to reduce its workload as a result of capacity constraints. 

Mr Ramatlakane noted that the SAPS had adopted a 5-year research agenda concerning Police modelling. Does this bring the Civilian Secretariat’s role into question? Will SAPS develop the model for policing in-house, or with the assistance of the Civilian Secretariat? Considering the department’s mandate of advising the Minister on policy direction, is it apparent that SAPS does not trust the Civilian Secretariat? Who will the Minister be more likely to listen to? Where are the contradiction and conflict in this regard? Will SAPS resources cause it to overshadow the work of the Civilian Secretariat? What kind of engagement is there with SAPS around this “functional area”?

The Chairperson stated that this question has operational and tactical implications. Considering the years preceding the Marikana incident, specifically the debate around the use of force by SAPS members, “lines were taken”. If the Minister will only listen to one of the institutions, there is a serious problem.

With reference to the report compiled by the AGSA, Ms Kohler-Barnard noted that there were areas identified where external expertise could have been brought in to assist. Considering the issue of material underspending also highlighted, could these funds not be appropriated to core functions such as finalising reports? She noted the AGSA had also mentioned the absence of the department’s service delivery programme. She argued that the legislation sub-programme required more personnel and expertise, and if this required contracting of external help, then so be it.

The Chairperson noted that the “Compliance with Legislation” indicator in the AGSA report was in red in terms of the AGSA’s compliance model. What is the department dong to rectify this? He stated that the department should provide a description of evidence in terms of the quality of its technical indicators.

Mr Mbele noted that in the Civilian Secretariat’s Annual Report, the Forward section states that “research has shown that frontline policing is performed by 43 percent of the staff compliment, which indicates that 57 percent of police personnel are employed in management and administrative positions.” Is this one of the key findings of the Analysis on Police Resource Allocation? Should this be the case? He argued that this statement explains a great deal about SAPS’ underperformance in terms of its performance targets. He questioned why around 75 percent of the SAPS budget is going to individuals who are not actively policing, but rather occupying provincial offices. He stated that this speaks to the weak levels of accountability and consequence management within SAPS. Could the Civilian Secretariat highlight recommendations or corrective measures to rectify this situation? How can we ensure that that funds are allocated towards the outcome of making people feel safe?

Ms Molebatsi asked how the Civilian Secretariat is going to improve the roll-out of its risk-management strategy.

Mr Ramatlakane raised another question concerning the restatement mentioned in the presentation, where SAPS had refused to cover the legal costs incurred by the Civilian Secretariat. How does this change the department’s financial statements, since income has essentially become expenditure? When this expenditure is recorded, what is it labelled as in terms of the PFMA? If this expenditure is considered as an “Unspecified cost”, it implies that something is written off or condoned. Going forward, how will this matter be dealt with?

The Chairperson asked why there is no legislation on the table in terms of its legislation sub-programme. He stated that the draft Critical Infrastructure Protection Bill had been submitted to Parliament for noting. When will this Bill be bought to the Committee? What is the Civilian Secretariat’s progress with the service delivery improvement plan?

Mr Rapea stated that the Secretariat intends to appoint an individual on a contract basis to focus on the service delivery improvement plan, and is committed to submitting the service delivery plan in 2017. In terms of progress in appointing this individual, a shortlist has been compiled. He stated that the Critical Infrastructure Protection Bill has been tabled for consideration by Parliament. He stated that all the work had been done in this regard, and that the Civilian Secretariat awaits an update on its status.

The Chairperson requested formal clarification that the Committee would receive the Bill.

Mr Rapea stated that the Committee would receive the Bill in due course. He stated that legal advisors are assisting the Secretariat, and that the Bill met all the necessary conditions as of March 2017.

The Chairperson asked if there were any other legislations awaiting approval.

Mr Rapea stated that the Minister of Police had approved the draft Firearms Control Amendment Bill. The Acting-National Commissioner of Police raised certain points to be fine-tuned before the department could take the Bill to the Justice, Crime Prevention and State Security (JCPS) cluster. He stated that the Bill is likely to be introduced in 2018.

Ms D Bell, Chief Director: Legislation, CSP, stated that the letters for the Critical Infrastructure Protection Bill had been submitted on Friday 29 September for tabling in terms of Joint Rule 159.
Mr Rapea stated that the issue of non-payment by SAPS will be covered in depth by the CFO. He noted that the amount was reflected as ‘receivable’ in the 2015/16 financial statements, but is reflected in ‘expenditure’ in the 2016/17 statements. The Secretariat had liaised with National Treasury on the matter, and it had been discussed previously by the Portfolio Committee. Addressing Ms Kohler-Barnard’s question on the reallocation of funds, he stated that there is a rule that you cannot re-appropriate funds allocated to compensation of employees to goods and services.

Mr Nkojoana reiterated that the amount owed by SAPS was reflected as ‘receivable’ in the 2015/16 financial year, and this had been flagged by the AGSA during that year as they did not see the department receiving that money. The advice received from the National Treasury was to take on the amount as expenditure if SAPS were not willing to pay. He stated that this decision is reflected in the department’s overspending during that financial year. The National Treasury is expected to follow-up in terms of its classification as “unauthorized expenditure”, and the matter may be brought to the Standing Committee on Public Accounts (SCOPA). After receiving advice from the National Treasury, the Civilian Secretariat was comfortable with covering the cost in the interest of protecting its legislation. In terms of compliance with key legislation, Mr Nkojoana noted that one of the key principles in the finance environment is the payment of suppliers within 30 days. In the 2016/17 year, the department could only pay 60 percent of its suppliers within 30 days, however this figure has improved in the current financial year to around 87 percent. Many instances of non-payment pertained to issues around invoices, specifically for legal fees. It was noted that in September 2017, 100 percent of suppliers were paid within 30 days, and this issue is not expected to re-surface.

The Chairperson stated that the Portfolio Committee needed a commitment in terms of changing the outcome from ‘red’ to ‘green’ in adherence to key legislation.

Mr Nkojoana assured the chairperson that there would be a significant improvement in this area.

Mr. Beukman asked if the CFO expected a ‘yellow’.

Mr Nkojoana stated that the Civilian Secretariat expects a ‘light-green’.

The Chairperson stated that this was a serious issue as it relates to compliance, efficiency and procurement.

Mr Rapea stated that the outcome for adherence to key legislation should be ‘green’. He noted that the job description of Mr Mahlangu had been changed from ‘Anti-fraud and corruption’ to ‘Integrity and governance’. Within this new role, Mr Mahlangu follows-up on issues relating to governance on a monthly basis. On the issue of the department’s failure to pay suppliers on time, he noted that in some instances the department’s supply-chain management team has different information to the financial management team, therefore it has become a practice to cross-check this information regularly. In terms of consequence management, Mr Rapea assured the committee that individuals that fail to uphold their duties will be disciplined. In terms of the Civilian Secretariat’s risk-management strategy, the department was in the process of implementing a revised risk-management strategy put forward at the beginning of the year. The new strategy is much-improved in terms of the department’s ability to track the risks identified. Mr Rapea stated that it was apparent that the SAPS did not take the research of the Civilian Secretariat seriously and that there was some competition in terms of research. In some instances, however, the SAPS have simply implemented the research conducted by the Secretariat without asking questions. In terms of the shared “functional area” between the Civilian Secretariat and the SAPS, specific functions do require some clarity. He stated that the SAPS have a critical role to play in terms of research, specifically with regards to operations. The role of the Civilian Secretariat, however, is to provide strategic advice to the Minister. He stated that Ms Omar could elaborate on the kind of research currently in the pipeline.

Ms Omar stated that the quotation referenced by Mr Mbele was directly from the Analysis of Police Resource Allocation document. She stated that there was always a suspicion that the SAPS was top-heavy, and this research document confirms this notion. She suggested that once certain senior positions within the SAPS become vacant, they should be frozen. Furthermore, she noted that the AGSA had mentioned that cluster and station commanders needed more responsibility and to be held more accountable for the shortcomings of officers on the ground. Without federalizing the Police, a new financial model should be considered to make cluster and station commanders accountable for their own funding.

Mr Mbele inquired as to whether there were any recommendations in the discussion document on the National Policing Board on setting the criteria for the appointment and recruitment of top management.

Ms Omar she stated that there were recommendations on the criteria for appointment of top management in the discussion document.

Mr Rapea noted that the Minister had not year approved the National Policing Board, and that this was something of a sensitive issue. He stated that the Minister had only received a high-level overview on this matter, and that the department expects to discuss it further with the Minister in the near future.

The Chairperson thanked the delegation from the Civilian Secretariat for Police, and noted the feedback and improvements. He requested that the Civilian Secretariat’s internal audit team appear before the committee on the 24th of October to discuss the Civilian Secretariat’s action plan in detail.

The session was adjourned for lunch.

The Chairperson informed the IPID delegation that the committee had recently received a briefing by the AGSA on matters concerning the Portfolio Committee. Moreover, the committee had recently heard from the SAPS and the Civilian Secretariat for Police regarding their performances for 2016/17. In terms of the audit outcomes, he noted that there is evidence of a regression amongst the SAPS and IPID following qualified audit opinions for the two entities. The purpose of the session would be to discuss these audit outcomes, as well as to identify viable action plans going forward.

Independent Police Investigation Directorate on its Annual Report for 2016/17
Mr Robert McBride, Executive Director, IPID, noted that the periods 2015/16 and 2016/17 were characterized by instability at the department, as many employees – particularly senior management – had been dismissed, suspended or transferred. Many of these individuals returned in the third or fourth quarter of 2016/17, and from this point began to restore relative stability in the department. The period also saw a reduction in IPID’s budget, resulting in the freezing of 35 posts. Despite reduced capacity, there was an increase of nearly 30 percent in the intake of cases from 2015/16 to 2016/17. During the year under review, it was revealed that there had been an abuse of the special disclosures system, which led to criminal investigations within the department. IPID’s poor performance in 2015/16 created a low standard for 2016/17, therefore although the performance appeared fairly good, it was based on a number cases closed prematurely.

Despite constrained capacity, IPID’s reporting obligations were not reduced during this period, even when the capacity to report was minimal. This was the case with internal controls and accounting, where IPID has insufficient personnel to deal with reporting requirements. The 2016/17 year also saw the Constitutional Court judgement echoing the same sentiment regarding capacity and the operational independence of IPID.

Since the 2015/16 financial year, IPID has experienced consecutive years where accruals have increased over time. Mr McBride stated that an accrual from a previous financial year had left a hole in the budget for the next financial year. The costs relating to the unlawful and irregular transfers of staff and resources led to overspending for goods and services during the year under review. The unfunded mandate for the investigation into the Marikana Incident also saw staff travelling distances during the period 2016/17, accelerating this overspending.

Mr Sesedi, Acting-CFO, IPID, noted that IPID had received a qualified audit opinion for the 2016/17 financial year, due to the issue of misstatement of accruals. The accruals increased substantially from R6 million in 2015/16 to R24 million in the 2016/17 financial year. This was mainly as a result of extensive budget cuts to IPID in previous financial years. Inadequate capacity in internal control systems, particularly in supply-chain management resulted in the qualification on the disclosed amount of accruals. The R9.2 million accrual figure reported by the AGSA is not an exact amount, but was in fact extrapolated by the AGSA based on its audit methodology.

IPID had a total budget of R242 million for the 2016/17 financial year. An amount of R169.5 was allocated to Compensation of Employees; R70.7 million to Goods and Services; R1.4 million to Transfers and Subsidies; and R286 000 to Capital Assets. In terms of expenditure for the period, IPID underspent R397 000 on Compensation of Employees, and overspent R17 000 on Goods and Services.

During the year under review, IPID prepared and implemented two virement applications totaling an amount of just over R1 million. These were approved by the Executive Director in terms of Section 43 of the PFMA, for the purpose of defraying expenditure in the Investigation and Information Management programme to cover costs in Transfers and Subsidies and Payment for Capital Assets. The virements were necessitated to cover unforeseen court expenses, as well as payment for emergency investigative equipment.

The department did not incur any unauthorized expenditure in the year under review, however the amount reported in the financial statements reflects over-expenditure in prior years, namely the 2005/06 and 2008/09 financial years. The submissions and follow-ups requesting the authorization of the disclosed amount have been submitted to the National Treasury for consideration. As of the reporting date of 31 March 2017, the approval for the authorization had not yet been granted, despite several follow-ups.

An amount of R3.2 million was disclosed as fruitless and wasteful expenditure in the year under review. This expenditure was primarily as a result of the reorganization of staff, as well as the appointment of the Chief Director for Corporate Services on a contractual basis, despite the incumbent being under suspension. The expenditure was reported to IPID’s Fruitless and Wasteful Expenditure Register for internal investigation, and the investigation is currently in progress.

An amount of R2.5 million was disclosed as irregular expenditure in the year under review for various cases not yet finalized by the end of the reporting period. An amount of R451 000 was incurred during the year due to the appointment of the Chief Director for Corporate Services, which resulted in non-compliance with Public Service Regulations. Expenditure of R18.5 million on long extension of various contracts dating back to 2006 has also resulted in irregular expenditure, as recommended by the AGSA. The CFO noted that many of these contracts had been entered into before the conversion of the ICD to IPID. For this reason, the total disclosed figure of irregular expenditure including the adjustment for prior years amounts to R21.5 million.

Ms N Netsianda, Head: Programme 1: Administration, IPID, reported that the number of employees trained by IPID’s training plan was 106, falling short of the target of 150. The vacancy rate at IPID increased from 9.42 percent in 2015/16 to 11 percent in the 2016/17 financial year, just exceeding the target of 10 percent. Budgetary constraints and the freezing of vacant posts were cited as the reasons for non-performance in this indicator. After selecting candidates and conducting interviews for these vacant posts, IPID made the decision not to fill the posts. Ms Netsianda reported that IPID had only implemented 70 percent of its internal audit plan due to budgetary constraints. IPID was not able to produce any statistical analysis reports on performance, despite targeting the production of four such reports during the year under review. The reason cited was the unavailability of funds to procure SPSS software.

In terms of strategies to overcome areas of under-performance, Ms Netsianda stated that IPID intends to fill all vacant posts, conduct the majority of internal audits at the National Office in 2018/19, review the indicator for statistical analysis reports in the 2017/18 APP, streamline systems and processes to ensure the most is achieved with the limited resources, and conduct a skills audit analysis on its staff. The skills audit will identify the various levels of skills within the department to better allocate these individuals to positions better suited to their qualifications. 

Mr M Seseko, Head: Programme 2: investigations and information management, IPID, reported that IPID had experienced a 27 percent increase in the number of cases reported (7014) compared with the previous financial year (5519). In terms of the case intake per province in the 2016/17 year, the most cases were reported by the Western Cape (1383), followed by Kwazulu-Natal (1228), and subsequently Gauteng (1138). The least complaints came from the Limpopo, Mpumalanga, North-West and Northern Cape Provinces. Most provinces experienced an increase in 201617 compared with the previous financial year, with the exception of Limpopo and Mpumalanga.

The highest number of cases reported in the year under review related to assault, with a total of 3827 cases. Of these cases, 911 were reported in the Western Cape, 585 In the Free State, and 501 in Kwazulu-Natal. The second-highest number of cases reported related to the discharge of an official firearm (1640 cases). During the year under review, IPID received 160 cases for corruption, 6 cases of systematic corruption, 173 cases of torture, 20 cases of rape in police custody, 112 cases of rape by a police officer, 394 deaths as a result of police action, and 302 deaths in police custody.

A total of 1140 recommendations were forwarded to the National Prosecuting Authority in the year under review. Of these cases, IPID awaits responses from the NPA to 1015 cases. The NPA declined to prosecute 26 of these cases, and made the decision to prosecute in 9 cases. A total of 1238 recommendations were forwarded to the SAPS, including 270 positive recommendations. In terms of the feedback by SAPS on negative recommendations, IPID awaits responses on 706 cases, 58 were deemed ‘Not Guilty’, 39 were deemed “Guilty’, 1 case led to service termination and 139 led to internal disciplinary investigations.

IPID received a total of 276 departmental convictions in the year under review, of which 145 resulted in a written warning, 38 resulted in verbal warnings, 27 resulted in fines, 19 resulted in dismissals, 17 resulted in corrective counselling, 14 resulted in suspension without salary, 12 resulted in final written warnings, and 4 were reprimanded. IPID received 45 criminal convictions in the 2016/17 year, resulting in 51 members being convicted for various crimes.

Mr Seseko stated that under-performance could be improved by monthly monitoring of provincial performance to ensure the attainment of targets; continued engagement with key stakeholders; the alignment of performance targets with performance trends and confirmed resources; and provincial audits by IPID management.

Ms M Moroasui, Head: Programme 3: Legal Services, IPID, reported that IPID had achieved 100 percent for its annual target for the provision of legal advice to investigators. Only 71 percent of written legal opinions were provided to the department within 21 working days, falling short of IPID’s target of 90 percent. 29 percent of policies were reviewed for legal compliance within 21 working days, falling short of the target of 90 percent. The reasons for underperformance in these areas was attributed to capacity constraints as a result of restructuring, transfers of personnel, vacancies and frozen posts. In terms of the strategies to overcome underperformance, IPID is in the process of filling the position of Deputy Director for Litigation and intends to fill the post of Director of Investigation Advisory Services when funds become available.

Ms M Molope, Head: Programme 4: Compliance Monitoring and Stakeholder Management, IPID, reported that IPID had failed to achieve its target of generating an approved Integrated Communication and Stakeholder Engagement Strategy in the year under review. IPID was successful in creating a draft strategy, however the consultation process with IPID management was delayed due to MANCO meetings being deferred to the next financial year as a result of budgetary constraints. IPID conducted 98 community outreach events under the year under review, falling short of its target of 108. IPID released 245 media statements and responses during the period, exceeding its target of 40. This enhanced media interaction was attributed to high interest in IPID cases by the general public. IPID conducted 120 formal engagements with key stakeholders on a provincial level, falling short of its targeted 144 engagements. Underperformance in this area was attributed to budgetary constraints, as well as the unavailability of stakeholders such as SAPS and the NPA in the year under review. IPID plans to improve performance in this programme through enhanced (monthly) monitoring of provincial performance in implementing the stakeholder and community outreach plans.

In terms of improving performance relating to the AGSA’s findings, Mr McBride stated that IPID intends to continuously monitor the strategies – including skills audits - identified to improve performance, strengthen its internal control systems, attempt to capacitate the internal governance units within the department, and implement the AGSA recommendations with management action plans.

Discussion
The Chairperson mentioned that the AGSA had highlighted a slow response by IPID management to address its audit findings, as well as a lack of attention to key drivers of internal controls effecting leadership and governance. He stated that the responsibility for consequence management – particularly in cases of non-compliance - was with IPID management, and that the Portfolio Committee must be given assurance that this will be seen to. The budgetary and capacity constraints are noted; however there is a clear regression in terms of audit outcomes, specifically concerning key controls. If the programme managers are not performing, IPID management must “crack the whip” in order to change the performance outcomes to “green.” In terms of programme 2: investigations and information management, this programme constitutes IPID’s core business. IPID achieved positive performance reviews in only 5 of 14 areas. What does IPID intend to do to rectify this situation? The Chairperson stated that the Portfolio Committee would be summoning IPID and the Civilian Secretariat on the 24th of October to discuss their performance reviews in the presence of the respective audit committees. He stated that there was material uncertainty relating to IPID as a going concern. Although this issue did not appear in the presentation, it is a major issue that should be discussed with the Minister, National Treasury and SAPS. IPID must provide the committee with strict timelines for its action plans, considering the AGSA’s comments on the slowness of responses. He stated that the accrual issue would not go away unless IPID received the R40 million it needs.

Mr Ramatlakane stated that the committee had previously heard of a budget cut of around R14 million from the Acting- Executive Director that would cause 14 senior management positions would be scrapped. He suggested that there should be some engagement with the executing authority and the National Treasury on this issue, as it pertained to the functionality of IPID. Has anything been done since this figure was reported? It must be accepted that IPID has a big problem, and that there are problems in getting out of the problem. Considering the recommendations of the AGSA report, how will IPID get out of this position? The AGSA report was particularly critical on the issue of internal capacity to handle finances, specifically on the handling of the accrual problem. In terms of performance in the core programme, he stated that 17.6 percent figure was unacceptable, and could not be explained merely on the basis of financial constraints. IPID still had a responsibility to deliver based on the targets set. He argued that the amount of unauthorized expenditure is growing, and is inconsistent with the requirements of the PFMA. He noted that all other departments had received visible budget cuts, but had readjusted their budgets accordingly; however IPID had not done this. Why did this adjustment not happen?

Mr Mbele stated that the committee was of the view that the objective picture presented was a very bad one. In particular, the assessments on IPID’s vulnerability as a going concern. He acknowledged that half of the financial year under review was an unstable environment, due to vacancies and the movement of personnel, therefore a more fair assessment would be to analyze performance from October 2016 to this year, during the current Executive Director’s tenure. What are the progress updates in the last six months? He stated that the Committee needed assurance that worrying trends are on the uptick.

Ms Mmola thanked the IPID delegation for the presentation. She noted that it had received a qualified audit opinion in the 2016/17 AGSA report. What steps will be taken to ensure an unqualified audit opinion the next year of assessment? What are the specific details of the capacity constraints referenced by IPID? How does IPID intend to improve considering these constraints? Could IPID provide details on the nature of civil claims made against the department in the 2016/17 financial year? How does IPID intend to deal with the issue of accruals? What led to the significant increase in irregular expenditure compared with the previous financial year?

Ms Molebatsi requested that IPID provide an update on the corruption cases reported for the 2016/17 financial year. She noted that there had been an increase in the cases of misconduct against police officers. What is the reason for this increase? When will the position of the Acting-CFO be filled? What are the developments in the remedial action against police recommended by the Farlem Commission?

Ms Kohler-Barnard asked why an amount of R2.5 million was considered to be irregular expenditure when it relates to cases not yet completed? Will IPID be able to get out of these long term contracts from 2006? Does IPID want to get out of these contracts? Was the figure of R21.5 million reported in the presentation incurred in the current financial year? Does the AGSA consider the salaries for suspended staff readmitted to be fruitless and wasteful expenditure? She stated that the 17.6 percent for core business performance was a “horrendous figure.” She acknowledged that IPID still awaits results from the Department of Health and the SAPS forensic labs. Considering these delays, does the authenticity of the findings come into question? How many rapes and deaths in custody can be attributed to SAPS? She noted that these figures were down, however the cases of assault by police had increased. What has caused the massive increase in the number of cases sent to IPID? Ms Kohler-Barnard argued that in the past, SAPS-related bodies have treated the Portfolio Committee and its recommendations with “absolute contempt”. Of the 1132 recommendations sent to SAPS pertaining to deaths, rapes, assaults and torture, only 39 officers have been found guilty, while only one officer has been fired. Is IPID wasting its time in this regard, or are many of these allegations being fabricated?

Ms Molebatsi asked how IPID would ensure adherence to the formal code of conduct, considering the AGSA’s recommendations on leadership.

Mr McBride stated that prior to the meeting IPID had made the decision to not focus on the shortcomings of the 2015/16 year as it did not pertain to the meeting’s agenda. However, in doing so, IPID did a disservice to the committee and itself by providing insufficient context to the current state of affairs. He stated that in the recent years, the criminal justice system in South Africa came under attack, including IPID. When IPID returned from suspension for illegal activities that were supported by the Former-Minister, there was a sentiment of fear, mistrust and an expectation of a great purge within IPID. He noted that 4 or 5 individuals had joined IPID during its suspension, but went back to criminal intelligence when IPID returned. He stated that there was a clear intent to infiltrate IPID at this time. An example of this was the fact that IPID had been used to process the security clearance of the Former-Minister’s Chief of Staff, Mr Mbangwa, a Zimbabwean national, based on falsified documentation. This was the extent of the instability, as IPID had become “a vehicle for wrongdoing.” He stated that Mr Mbangwa has since become employed by the Department of Public Works.

Ms Mmola stated that she did not understand the connection between the questions and the Executive Director’s explanation.

The Chairperson allowed Mr McBride to continue.

Mr McBride stated that upon the return of suspended staff in the third and fourth quarter of 2016/17, the intention was to stabilize IPID and reestablish trust within the department. A substantial group of people had been “warming seats” since the suspensions, and little had been done processing investigations during that time. Upon the return of staff on suspension, these people left, including those involved in the fraudulent premature special closures in 2015/16 and 2016/17. Some resigned, while others were transferred to other departments. One individual that stayed on is currently on suspension and is awaiting disciplinary action. This was the extent of the uncertainty, instability and mistrust within IPID during that time.

Considering the limited time left in the 2017/18 financial year, Mr McBride stated that IPID had decided to change its emphasis on high volumes to low volumes with high impact. IPID took human resources from the provinces to re-constitute the Special Investigating Team, with some positive results. On the issue of special closures of cases, the AGSA identified this in the 2015/16 year. As a result of special closures during that year, the target-setting for 2016/17 was unrealistically high. This was compounded by the fact that during the period, IPID had a smaller budget, less staff, misappropriated human resources. With regards to the latter, Mr McBride asserted that the misallocation of staff was a deliberate attempt to disrupt the work of IPID. He stated that if he were to fire all the staff at IPID, there would not be an improvement in the department’s overall performance. To this extent, he stated that IPID is doing the best it could with the limited resources available. Addressing the irregular expenditure from contracts dating to 2006, he stated that there was no deliberate misconduct in the qualified audit opinion; however the CFO and the chairperson of the audit committee would deal with this issue in greater detail.

Mr McBride stated that IPID’s increase in the number of cases was as a result of all the anti-corruption units becoming compromised. He argued that the public is beginning to trust IPID again, particularly in high-profile cases. He stated that the decision for strategic change will soon bear fruit, as IPID can build on the momentum it generated in the current financial year.

Mr Motali, Chairperson of the audit committee at IPID, stated that the qualified opinion came as a disappointment to IPID, considering its achievement of an unqualified opinion for the previous seven years. The audit committee had an extensive engagement with management as well as the AGSA on the misstatement of accruals, and IPID does not believe that the misstatement was deliberate. In this context, the accruals were almost a “soft word” for unauthorized expenditure because these accruals were the result of a disputed invoice or a late submission of invoices. However, IPID runs the risk that what is called “accruals” will be interpreted as unauthorized expenditure by virtue of the funding constraints. He stated that another major concern was that these funding constraints will impede IPID’s capacity to fulfill its core mandate. He argued that this capacity has been slowly depleted over the years, and the issue was critical. With regards to the long-term contracts, 90-95 percent of the irregular expenditure reported comes from these contracts. The audit committee has requested that progress reports on these contracts be presented on a quarterly basis. By the end of current the financial year, the audit committee hopes to reach a point where these contracts are regularized.

Mr Sesedi stated that with regards to unauthorized expenditure, the increase from the 2015/16 to 2016/17 financial years was from the accruals exclusively. This figure increased from R6 million in 2015/16 to R24 million in 2016/17 as a result of the budget constraints mentioned. In terms of measures to negate the effects of these accruals, IPID has centralized contracts for security and cleaning services. The procurement process on the security services has almost been finalized, however the procurement of cleaning services has been unpredictable, as none of the bidders met the specification requirements for the contract, therefore IPID was forced to re-advertise the contract. When there are delays such as this in the procurement process, the existing contracts must be extended. The AGSA had highlighted these extensions in its annual report. In terms of the measures in place to address the AGSA’s recommendations, IPID management have agreed to establish action plans with timeframes, as well as the establishment of a task team that will visit all the provinces to address specific issues raised by the AGSA. The intent is to share the principles of the action plan with management in each province. 

The Chairperson stated that in terms of IPID’s viability as an institution, the issue of accruals will continue unless there a clear picture of IPID’s mandate for the new year. He stated that IPID required the support of its stakeholders to address this.

Mr McBride stated that the issue raised by the AGSA on the viability of IPID as a going concern echoed the recommendations of the Farlam Commission and the Constitutional Court in that the primary issue is insufficient funding. He argued that this issue was non a result of perceptions of gross-mismanagement. Without the necessary funding, IPID cannot carry out its mandate, and this is manifested in the poor performance of the core business programme. He stated that with the support of the Minister, IPID has had a series of engagements with National Treasury and SAPS to reprioritize some funding from SAPS, expected to be around R50 million per year. The plan is to share some of the resources and facilities with SAPS, however this has not been finalized.

The Chairperson noted that in the last meeting, the Acting-CFO had reported that there had been a request for adjustments denied.

Mr McBride stated that IPID had sent an interim note to the Minister to indicate that of the R50 million to be allocated from the JCPS cluster, a large portion would simply be swallowed up by the accruals incurred this year if the hole is not filled. He noted that SAPS had not yet responded to the request for relief in the current financial year, but a response is expected within the next six weeks.

The Chairperson pointed out that the Minister of Police is presenting in the third week of October. Will be allocation for next year be approved before then?

Mr McBride stated that in every forum – including with the Ministry - the issue of underfunding had been raised. The Minister has since engaged with National Treasury on the matter, however there is no indication of what the letter of allocation will look like. He noted that in 2014/15, IPID had made similar engagements without seeing results. He stated that the CFO possesses greater detail on these engagements.

The Chairperson stated that it may be necessary to present this information during the engagement on the 24th of October. If IPID requires executive involvement on the issue, this must happen in the next three weeks, as the allocation process is already underway.

Mr Ramatlakane requested that the chairperson of the audit committee provide greater detail on the situation regarding the accruals and the PFMA, in the interest of making an informed recommendation on the matter. How can this situation be rectified? What measures are in place to prevent the accumulation of accruals? If the situation continues, the department will soon run into problems with the PFMA. How will the accruals be reflected in the Medium-term budget statement? He argued that clarity on this was crucial in producing a definitive recommendation going forward. He stated that the committee could not condone the accrual situation in future.

The Chairperson argued that it was critical that National Treasury were on board in this process. There should be a timeline, as well as input from the Executive Authority. How will IPID move forward with the present situation while still getting support from the JCPS cluster?

Mr Sesedi stated that the accruals were discouraged in terms of the PFMA, however situations arose where there were disputes over services rendered before the end of the financial year, specifically a number of invoices that could not be paid. The services – which included accommodation, cleaning and security – could not be avoided due to contractual obligations, however IPID’s budget had been depleted four months before the end of the financial year. For the year 2015/16, some of these invoices could be paid, however in the year under review, IPID was unable to pay any of the invoices. Therefore, these payments must be rolled-over to the following financial year, and should be considered distinct from unauthorized expenditure.

Mr Ramatlakane argued that if IPID was moving accruals to the following year by default, then it technically becomes unauthorized expenditure. He implored IPID to assist the committee in making a recommendation on the matter.

Mr McBride stated that no provisions were made in IPID’s budget for the 10 percent increases in the cost for services year-on-year, as per the contractual agreement. He argued that this was the responsibility of the National Treasury. He stated that IPID could not simply leave the invoices unpaid, and that the PFMA was adhered to the entire time. In fact, National Treasury had advised IPID to negotiate with the service providers and hold back the payments until the following financial year.

Mr Ramatlakane stated that the current legislation has constraining provisions. He suggested that the National Treasury provide details on this engagement in writing, but at the end of the day, the National Treasury does not have the power to amend legislation.

The Chairperson stated that engagement with the Executive Authority and the National Treasury would be critical in resolving this issue. Unless this impasse is solved, the same issue will reappear.

Mr Sesedi stated that the last time IPID had appeared before the committee, the plan was to get a bail-out for the current financial year to address the accruals issue. Failure to secure this may worsen the situation, as IPID will have to renew the contracts for service providers once again at the end of the current financial year, which could result in more accruals the following year.

On the issue of consequence management, Mr Seseko stated that once incidents of wrong-doing are established, these incidents are investigated by IPID’s task team. There had been a criminal investigation into the irregular expenditure incurred under the Former-Executive Director, but before there could be a disciplinary process, he had already transferred to another department. When those recommendations were sent to this department, he had moved once again. For this reason, no disciplinary action was taken on this issue, and the matter is currently with the NPA. One IPID employee is currently under suspension awaiting disciplinary action, while another employee resigned before disciplinary action could be taken. He stated that IPID intends to align its performance targets with the capacity it currently has, and has implemented processes to gauge the reliability of performance information based on monthly validation and confirmation of this information.

The Chairperson stated that the Portfolio Committee had a similar discussion with SAPS, who have recently undertaken a “roadshow” to visit all the cluster and station commanders not performing. He stated that IPID must adhere to guidelines and supporting documentation when presenting its performance information. He recommended that IPID ensure that provincial offices adhere to the necessary guidelines for reporting performance information.

Mr Seseko stated that IPID had embarked on doing this by ensuring that there is certification of the information supplied by provincial offices. He stated that this was necessary to hold these officials accountable for the information they supply to IPID management. Regarding the question on corruption, a number of recommendations were sent to the NPA and SAPS on corruption matters. A major challenge is that the NPA refuses to prosecute the relevant parties, even when “strong” cases are submitted. In this regard, IPID has written to the NPA to discuss how prosecutions are processed. He noted that IPID does not always agree with the decisions made by the NPA. In terms of the increase in the number of cases taken on by IPID, Mr Seseko stated that since adjusting its strategy, IPID has experienced an increase in the number of cases from within SAPS as well as the general public. He noted that many of these cases were high-profile and in the media. Regarding case recommendations to SAPS, many cases are long-standing, and there is a problem with the slowness of SAPS’ reporting back to IPID. He suggested that there be an adjustment in terms of SAPS timeframes and level of responses to cases brought forward. He argued that SAPS has a responsibility to account to the Minister and the Civilian Secretariat on recommendations reviewed, however this was not currently happening effectively. On the question relating to the Farlem Commission, he stated that one of the key issues was capacity constraints considering IPID was forced to allocate some of its budget to the investigation. On the 22nd of August 2017, IPID handed all the dockets relating to the Marikana Investigation to the NPA, who will make a decision on who to prosecute. After this time, the NPA will refer the matter back to IPID.

The Chairperson inquired as to the timeframe for the appointment of a permanent CFO.

Ms Netsianda stated that IPID had approached a number of individuals for the position of CFO, and that the appointment should take place within one month. 

Mr Motali stated that the audit committee would ensure management kept to their word in appointing a permanent CFO, considering the critical nature of this position.

The Chairperson stated that the Acting-CFO appears competent, however the position is crucial for engagements with the National Treasury and the Executive Authority, and therefore should be occupied on a permanent basis.

Ms Moroasui stated that there were a number of civil claims against IPID during the year under review, mostly pertaining to unlawful suspensions, reorganizations and unlawful transfers of personnel.

On the issue of consequence management, Mr Motali stated that one area pertained to the department’s internal disciplinary processes; however it has become apparent that there is a reliance on members of the public service to chair prosecute and initiate disciplinary proceedings. Many disciplinary cases are postponed simply because the chairperson is part of another department and is unavailable. With this considered, one must pay attention to the effects of delays in consequence management. IPID has considered contracting in order to negate this process, however budgetary constraints have limited its capacity to do so. Mr Motali agreed that there has not been effective consequence management at IPID.

The Chairperson noted that the internal audit plan had not been completed because of capacity constraints.

Regarding capacity constraints within the legal programme, Ms Moroasui stated that legal services is supposed to have five offices, however it currently only has three functioning. For this reason, IPID is trying to make a case to National Treasury to recruit more legal personnel to the structure to assist with litigation matters.

The Chairperson stated that the audit committee had also raised the issue of the costs of litigation, however this was understandable considering the high-profile cases taken on by IPID. He stated that there were a lot of issues relating to key controls that were within senior management’s domain, including effective human resource management. Can the committee get a timeline for the improvement of key controls during the session on the 24th of October? In terms of the number of deaths in custody, the figure has increased since the previous financial year. What is the reason for this increase? Have there been more arrests?

Mr Mbele cautioned that there was a looming threat given the going concern that some district offices may have to be closed to cut costs, which would obviously reduce IPID’s footprint. He noted that many of the intended steps and measures within the recovery plan were contingent on other parties, specifically IPID awaiting the response from SAPS on the request for relief. He stated that IPID was also dependent on National Treasury on what it can do in terms of adjustments and increasing the baseline on the EME’s. Looking forward for costing and planning, is IPID considering an 80-20 analysis for resources and outcomes? He suggested that this should act as a guiding principle to maintain and sharpen the impact of IPID. Has anything along these lines been considered, given the accrual issue and financial constraints? He made reference to IPID’s annual report, specifically on fruitless and wasteful expenditure. Why did the relocation of IPID cost R1.9 million? Was this during the tenure of the Former Acting- Executive Director? He noted that in the Executive Director’s forward, he made mention of legal proceedings to recover some fruitless and wasteful expenditure. Has there been any progress on this legal process? Has IPID considered the approach adopted by some courts, where when a public office-bearing party loses a case, they are held personally liable for the legal costs?

Ms Molebatsi inquired as to the allegations of fraudulent closure of cases by individuals falsifying their identification as IPID employees. Were these cases forwarded to the integrity component for further investigation?

Ms Kohler-Barnard remarked that asking IPID questions was like walking on quicksand. She noted that the AGSA had referred to a points system created for procurement, in contravention of the prescribed Preferential Procurement Policy. Was this system created during the suspension of IPID staff or after their return? Is this system still being adopted? The AGSA had also suggested that during the suspension period, senior managers override internal controls to performance information by “padding” the results. She expressed concern that incompetent employees are simply moved to another department as a result of underperformance. Is this issue being followed up? Can charges be laid against these individuals? She argued IPID had regressed to a situation where the National Treasury is telling the department which liabilities it should pay. Is this approach detrimental to small suppliers, who stand to lose more from non-payment? She stated that according to the AGSA, IPID had approved performance bonuses for 91 officials, despite the qualified audit outcome. What is the reason for this? Considering the increase in civil claims against the police in the past year, what is the nature of these claims? Do genuine criminal actions outweigh the incidents SAPS is wrongfully blamed for?

Ms L Mabija (ANC) stated that if she had the necessary powers, the entire IPID staff compliment would be given the boot tomorrow.

Mr Ramatlakane stated that he still had concerns regarding the Farlem Commission issue. If it is found that the documentation submitted to the NPA is insufficient, how will the NPA refer back to IPID? Will this be where the matter ends, or will there be a “second bite” at it? He stated that this was a proper inquiry that must be implemented. Who is attempting to sabotage this process? Given the financial challenges faced by IPID, has there been any institutional modelling to make IPID more effective? What is the plan in terms of the funding model going forward?

The Chairperson noted that the Minister of Police had made the observation upon his recent visit to Phillipi-East that there was a distinct criminal element within SAPS. He noted that IPID had entered into various MOU’s with some institutions in the Policing space. He stated that this was useful for increasing cooperation, however it was always a risk for independent institutions. Can the Executive Director provide assurance that IPID has not been compromised in this manner, considering the recent arrest of a member of the DPCI in Mpumalanga?

Mr McBride stated that IPID had entered into an MOU with the Inspector-General of intelligence to establish a task team to integrate their mandates to conduct a criminal investigation into fraud, corruption and abuse of the Secret Service Account within Crime Intelligence. He stated that this MOU would bring the quickest results and the most seminal impact on policing in the country, considering that the misuse of funds is in the range of around R500 million. He stated that the independence of IPID will not be impacted by the MOU, but understood the risks of anti-corruption units abusing their independence. He stated this had happened to himself and his colleagues during their unlawful and unconstitutional suspension. Ultimately, there would be a trade-off at IPID between fulfilling its mandate and sacrificing its footprint. IPID would have to close its offices unless granted some relief, however the question remains which offices to retain. He reiterated that the accruals pertained to underfunding, and that there was no purposeful wrongdoing by any IPID member in this regard. In terms of the fruitless and wasteful expenditure, he stated that the reorganization was “madness”, and that the costs in terms or relationships and human morale could not be quantified. He asserted that there had been a structured, purposeful undermining of IPID as a functional institution, which could be part of a larger conspiracy.

Mr Mbele stated that it was interesting to see “how deep the rabbit hole goes.” Did this reorganization constitute a “hollowing out” of IPID?

Mr McBride agreed with Mr Mbele’s statement, adding that it was also an attempt to infiltrate and undermine IPID. He argued that a similar phenomenon had taken place at the DCPI, the NPA and the South African Revenue Service (SARS).

Ms Molebatsi asked what happens when IPID are accused of corruption? Who has the authority to prosecute?

Mr McBride says that when this is the case, the due processes are followed, and the IPID member in question will usually get arrested. He noted that “obscene” haste by the NPA in dealing with cases recommended by IPID. He argued that the NPA was defeating the ends of justice in doing this. He stated that society is getting the feeling that wrongdoing pays and that one can get away with it. He stated that his staff is committed to its mandate, and that “IPID is the only organization standing uncaptured”.

On the question relating to performance bonuses, Ms Netsianda stated that these bonuses were for the 2015/16 financial year, and were meant for lower-level employees. IPID has since rectified the situation, and the bonuses were not paid.

Mr McBride assured the committee that no performance bonuses would be paid for the current financial year.

Mr Sesedi stated that the R1.9 million cost of relocation referred to by Mr Mbele was spent on travel and accommodation expenses, resettlement costs, as well as arbitration awards for suspended members.

Ms Kohler-Barnard argued that it was not fair that IPID was forced to pay for the Minister’s wrongdoing, after particularly since the Minster was beaten in court.

Mr McBride stated that only his legal costs were only covered by the Minister, and that he had not yet been paid for these costs. He stated that it was a different Minister, and had decided “let bygones be bygones.” He stated that Former Acting-Executive Director Mr Kgamanyanye had acted under the instructions of Former-Minister Nhleko to institute disciplinary processes, transfers and suspensions at IPID. He stated that IPID now has to pay because the former Acting-Executive Director had taken this decision.

In terms of the question relating to the Farlem Commission, Mr Sesoko informed the committee that IPID had agreed to meet with the NPA on a weekly basis. He stated that the NPA would look at the evidence in its totality to decide whether they are able to prosecute anyone. The NPA will then have to make a decision on the funding for this prosecution, or invoke a section in the NPA Act to make the funding available. He assured the committee that IPID had done everything from its side in terms of engaging with the National Treasury and the Ministry on this issue.

Mr Ramatlakane requested that the committee be provided with its last submission of R5 million.

Mr Sesoko stated that the committee would be provided with this correspondence. With regards to the special closures, IPID has initiated an investigation. As it stands, one person is under suspension, while another has left the department.

The Chairperson inquired as to the reason for the increase in deaths in custody.

Mr Sesoko stated that when the figure for deaths in custody is broken down, the highest number of these deaths relates to natural causes, secondly suicide, and thirdly injuries sustained prior to custody. After these statistics are complied, the information is submitted for research so that IPID can make a recommendation to the Minister of Police. However, because of capacity constraints, this research was not conducted during the financial year under review.

The Chairperson thanked the IPID delegation, and the meeting was adjourned.