Defence & Military Veterans facilities: status report from Public Works & Department

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Defence and Military Veterans

08 November 2017
Chairperson: Mr M Motimele (ANC)
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Meeting Summary

The Department of Defence (DoD) infrastructure portfolio briefed the Committee on the various challenges it was facing with regard to the projects which were being handled by the Department of Public Works (DPW).

There were currently 104 capital works projects and 56 refurbishment projects under execution by the DPW, and 95 capital works projects and 38 refurbishment projects to be registered with the Department. The concerns over the maintenance of 1 Military Hospital were highlighted. The challenges of accommodation for the Department, and the accommodation charges, were also discussed. The DoD expressed its frustration and at the non-communication of the DPW in response to the various requests it had made regarding 1 Military Hospital and other projects.

The Department of Military Veterans (DMV) gave an update on the status of its office accommodation and interactions with the DPW. It said it had made 11 requests for accommodation, and these had been registered with the DPW as far back as May 2015, and it was still waiting for responses.

The DPW presented its remedial actions and planned turn-around strategies to address the various issues which were raised by the Department of Defence and the Department of Military Veterans.

Members of the Portfolio Committee were generally highly critical of the DPW, with one of them specifically referring to the Department as irresponsible, with a penchant for wasting public funds. It placed some of the blame for the non-delivery of basic services by the Department of Military Veterans and the Department of Defence on the Department of Public Works. It was agreed that the DPW should return to the Committee with a comprehensive presentation indicating what it had done and what it was going to do to address all the issues raised by the DMV and the DoD.

Meeting report

Department of Defence (DoD ) Infrastructure Portfolio: Status report

Maj Gen Mogoruti Ledwaba, General Officer Commanding (GOC): Defence Works Formation (DWF), said the mission of the DWF was to provide an appropriate, ready and sustained facility management capability to the DoD by means of integrated systems for real estate management, maintenance, construction, military integrated environmental management services, and a system for facility education, training and development.

The DWF managed two portfolios. Portfolio 1 was connected to the management of projects executed by the Department of Public Works (DPW). In this portfolio, the DWF collates information within the DoD, submits it for execution by the DPW and monitors the progress. The Defence Works capability undertakes a yearly planning process of updating the User Asset Management Plan (UAMP).  The UAMP was a planning document which was informed by the inputs from the Services/Divisions in accordance with their force support, force preparation and force employment facility requirements for the medium term expenditure framework (MTEF). The Services/Divisions were required to submit a Certificate of Essentiality (COE) to the DWF for facilities which needed to be refurbished, demolished, constructed or leased in order of priority. The UAMP was used to compare the needs and go through a prioritisation process, together with the Services/Divisions and produce the Department of Defence priority list, which was then given to the DPW for execution.

Ordinarily projects registered with the DPW were of the magnitude which took a minimum of 24 months to complete. To control projects, the DWF uses stages to determine whether there is progress or not. Once the DFW realises that the project is not progressing from one stage to another, it lodges a formal complaint at the established forums, up to the Director General (DG) level. There were currently 104 capital works projects and 56 refurbishment projects under execution by the DPW. There were 95 capital works projects and 38 refurbishment projects to be registered with the DPW.

The historical challenges which the Department of Justice (DoJ) had experienced in respect of projects executed by the DPW were discussed. These challenges had necessitated an intervention by the Secretary of Defence and the Director General (DG) of the DPW. Some of the issues which needed interventions included the long turnaround times on projects, the appointment of consultants and contractors by the DPW, and non-remedial action against contractors on poor workmanship.

With regard to the historical challenges on leasing and municipal services, the Department of Defence decided to have the DPW administer the municipal services and leases, since there was insufficient structure to render the services in the DoD.  It had been discovered that the DPW had processed the municipal accounts and leases for DoD payments without conducting proper verification. Regarding accommodation charges, the Committee was informed that accommodation charges was a devolved budget from National Treasury, and annually the DPW  was being given up to R1 billion which had to be used to fund the day-to-day maintenance, planned maintenance, rates and taxes for the Department of Defence.  The DPW had annually under-performed on the planned maintenance programme, notwithstanding the budget being prepared quarterly. The DWF had adopted a strategy to ensure that the DPW made visible whatever planned maintenance programme it decided to undertake during the MTEF in order to allow the DWF to monitor progress. 

At the 1 Military Hospital, the DPW had failed to adhere to its promise to fix the leaking roof by using accommodation charges before the rainy season of 2017, and had failed to consistently maintain boilers, chillers, ventilators in theatres etc, resulting in the outsourcing of these services to the private sector.  The DPW must ensure that the budget provided to it through accommodation charges were fully utilised to support the facilities. 

As a result of these challenges and the frustrations expressed by the DWF, on 13 April 2017 the Secretary of Defence met the DG of the DPW, where it was agreed that a strategic management task team would be established, led by Maj Gen Ledwaba from the DoD and Mr Samuel Thobakgale from the DPW, to oversee and report progress to the two DGs of the Departments. Some progress had been recorded after the meeting of 13 April.  The DWF had conducted a pilot project to conduct verification on accounts received from the DPW, and currently R460 million (municipal accounts) and R53 million (leases) had been disputed with the DPW. The DWF had proposed that a section be created within its structure to take over this function. A pilot project had been established to finalise verification and the method of reimbursing the DoD. The DPW had in principle agreed to provide the DoD with credit note once they have finalised their internal processes.

With regard to 1 Military hospital, there were a few challenges. On 15 December 2016, there was a letter from the General Officer Commanding (GOC) appointing an electrical contractor who was not qualified to work on medium voltage installations, and a second electrical contractor was appointed. The contractors were appointed for a period of six months only. Presently, routine maintenance work was not being performed. This was because the DPW approves only emergency repairs. There was also an under-payment by the Department of Public Works which limited the maintenance work conducted by the maintenance contractors. The regional office of the Department of Public Works confirmed during a meeting on 4 Nov 16 that there was a shortage of funds and the procedure for getting approval for any maintenance need was a very lengthy process resulting sometimes in more damages. The maintenance challenges experienced at 1 Military Hospital included the boilers, air conditioning system, electrical installations, medical air plant, the main steam line and the passenger lifts. 90 hours had been claimed to replace a pneumatic valve that was actually replaced by a specialist’s sub-contractor in half a day, and 13 hours were spent to repair a leaking toilet. The current maintenance strategy used involves a re-active day to day maintenance strategy and repairs were carried out only in cases of emergency. It was also agreed that at the military hospital, systems needed to be refurbished to comply with new medical and technology requirements.

With regard to Portfolio 2, these were projects executed by the DWF using its own resources. It had carried out a number of projects in the past financial year, and it had planned a number of projects for this financial year and beyond. Although a lot of progress had been made, there were persistent challenges which were hampering progress. There were a total of 189 planned projects spread across the various provinces. Some of the strengths of the DWF included the mentoring and coaching of artisans, and the ability to execute maintenance and repair projects utilising its own capability. Some of the weak points included slow procurement processes for construction materials and the inadequate structures to support its mandate.

DPW response to issues raised by DoD

Mr Samuel Thobakagale, Deputy Director General, DPW, responded on behalf of the Depart to the issues raised by the DoD.  

Regarding the time taken by the Department of Public Works to vet the appointment of consultants and contractors, he told the Committee a meeting had taken place between the Department and the security agency, and the issue had been resolved. With regard to the non-immediate remedial action against contractors for poor workmanship, the quality issues -- including performance-related issues -- were addressed in biweekly technical and progress meetings which involved the entire project team. Also, a process had been put into place to place the non-performing contractors on terms in line with the conditions of contract.

On the turnaround time on projects taking too long, the DPW was currently busy with re-engineering business processes to eliminate unnecessary activities within the entire planning value process.

With regard to the DPW not responding to the request of the DoD’s request to execute projects on property falling under the Government Immovable Asset Management Act (GIAMA), approval had been granted by the DPW. The Department also showed the progress reports and status of various projects it was handling on behalf of the DoD.

Mr Jacob Maroga, DDG: Facilities Management, DPW, responded on the accommodation issues raised by the DoD, and said that there was a funding challenge. The DPW historically was responsible for the works budgets under its portfolio till 2006, when the National Treasury decided to divert such budgets to the clients of the DPW, so that the client paid the accommodation charges to the DPW while the DPW gave visibility to the client. To have the right funding, the DPW had to have the right accommodation charges.

Priority had been given to certain projects among the numerous projects being handled by the Department. The 1 Military Hospital was one of such projects. There was a backlog of about R75 billion needed to bring the project up to date before regular maintenance could begin to occur.

On the point made with regard to making visible what planned maintenance programme the DPW would undertake during the MTEF in order to allow the DWF to monitor progress, the DPW had put in place a structure referred to as ‘itemized billing’ to address this problem. Speaking further on the 1 Military Hospital, the maintenance structure was divided into two classes. These were the day to day maintenance, and the total facility management. The DPW had not been consistent with the day to day maintenance, and this had led to the deterioration of the hospital. To address this challenge, the DPW intended to carry out a total overhaul of the hospital within the next six months. However, it had employed the services of an on-site consultant to carry out the daily maintenance needed.

Department of Military Veterans: Update on office accommodation

Maj Gen Lifeni Make, Deputy Director General: Corporate Services, Department of Military Veterans (DMV) said the purpose of the presentation was to give an update on the status of the DMV office accommodation and interactions with the National Department of Public Works.

The DMV had eleven requests for accommodation registered with the DPW, going as far back as 5 May 2015. The lease agreement for the headquarters building had been signed in February 2014 between the DPW and the MMI Group Limited. The lease was still running and would expire in November 2018. Arrangements would have to be made, pending the construction of a new permanent DMV headquarters.

In June 2016, a request had been submitted to the DPW to start with the acquisition of permanent DMV headquarters. This had also been registered in the 2017-2020 User Asset Management Plan budget cycle in June 2016. In 2015, additional office accommodation was requested to supplement the current DMV headquarters. The building identified was adjacent to the building currently occupied by the DMV, and was owned by the same landlord. A nominated strategy and a deviation from the procurement process was requested from the Gauteng Regional Office, meaning that a suitable landlord for the DMV had been identified. This process had been halted without any explanation from the DPW. Meetings had been held with the regional office and letters of complaint sent to the DPW.

Mr Make gave a comprehensive status update of the various provincial offices of the DMV. These offices had faced various challenges. The first requirements had been submitted almost two years ago, but only three provinces had procured accommodation -- Mpumalanga, North West and the Eastern Cape. The officials at the regional offices of the DPW do not process the DMV’s requests with the urgency that is required and no feedback has been given on the progress of current procurement. This had prompted the request for a DG-to-DG meeting with the DPW, where all DMV office accommodation issues would be raised and dealt with.

With regard to the procurement of a health and wellness centre, a request for the health and wellness centre had been registered with the DPW since 2015 and subsequent meetings with the regional office had been held. The project had been delayed by the changing of officials within the regional office. Meetings had been revived last year and the need assessment submitted in March 2016. A specification meeting was held on 31 May 2017 to draw up the procurement strategy. The tender was not advertised, as documents submitted by the region to the national office were lost and they had to be re-submitted, and therefore the advertisement would not be done by this financial year. Regarding the way forward, a DG-to-DG meeting would again be pursued, where all issues would be raised and dealt with.


Mr S Esau (DA) said he regarded the DPW as a completely irresponsible department, where the goal posts were shifted all the time, with a total waste of resources. He marvelled at how the Department appointed incompetent contractors who lacked the skills and manpower to execute projects. He questioned the DPW’s vetting process. The use of information communication technology
(ICT) in project management had been proven to be an effective tool over the years. It was therefore unacceptable for the DPW to wake up only now in order to deviate from a manual process to ICT. It was unacceptable to continue to accept incompetence from the DPW, as it affected every other department it worked with. The DPW did not treat the DMV with the urgency and importance it deserved.

Mr Easu also asked for specific answers to all the legal cases of the DPW, and promised to write a letter to the Minister and the Department if he did not get specific answers to his questions.

Mr G Skosana (ANC) was of the opinion that DMV had not been able to deliver on its mandate because of the incompetence of the DPW. He wanted clarity and the truth on why the DPW could not provide the needs and requirements of the DMV. Referring to the six months’ turnaround plan of the DPW, he doubted that would happen, based on its past history. The obstacles causing the non-implementation should be made known, and if possible a political solution should be proposed. The commitment of the DPW to service delivery was also questioned -- the management of the projects should be a top priority.

Mr S Marais (DA) referred to the presentation of the DWF, which dealt with maintenance at 1 Military Hospital, and said the picture was a scary one. He wanted real indices to be presented so that the Committee could have a better understanding of what was happening at those facilities and their current state. Regarding the capacity-building programme for artisans, he criticised the Department of Defence, saying its priorities were misplaced and there was no excuse of lack of funding. There also had to be a definite plan on how and when the problems would be solved.

Regarding the presentation of the DPW, the question was what had been done differently and what the real situation was at the military hospitals. On the cost and financial calculations, he had a problem with the DPW using scientific calculations instead of real time calculations and indexes. The principles of basic planning and execution had been lost, which meant everything on paper meant nothing. He wanted a clearer explanation on the accommodation charges, stating that if they were what had been presented, it was a shocking state of affairs. It had been very wrong for the DPW to keep quiet about the requests handed down from the DMV.

Mr D Gamede (ANC) referred to the DPW presentation, and said it created a feeling of gloom and doom with regard to the backlog of projects. With the 1 Military Hospital, it had been a case of continuous spending with no commensurate output. He questioned if performance bonuses had been paid to the officials at the DPW, because there had been no output. The non-response of the Department to the requests of the DMV and the DoD was also questioned. There was a need to prioritise and focus funds on the more critical projects.

Ms N Mnisi (ANC) said that the waste of public funds by the DPW with regard to projects was totally unacceptable, and some of the blame for the non-performance of the DMV had to be put squarely at the door of the DPW. She asked if measures were in place to ensure that projects were completed by the Department before the contractors became insolvent. What was being done to complete the strategic security projects of the SA National Defence Force (SANDF), as the non-completion of those projects exposed them to significant risks.

An ANC Member wondered why the DPW could not complete the fencing project of the DoD, asking if it had the necessary capacity to fulfil its mandate and responsibilities to other departments. She also wanted to know what was being done to create a synergy with the other departments.


Mr Maroga acknowledged the concerns of the Committee with regard to the shortcomings of the DPW. He stated that some of the issues raised were fundamental matters which went beyond maintenance, and that there may be a need for the Department to come back to the Committee with a bigger team which would deal with specific issues, and give the Committee updates on what had been done to address some of them.

Mr Thobakagale indicated that the interaction between the DPW and its clients had been identified as a major challenge, and the Department had initiated a turnaround maintenance plan which was still being implemented. There was the need for the Department to come back to give a presentation on what had been achieved as a result of the turnaround plan. One of the problems encountered was the lack of capacity to handle some of the projects. This issue had been addressed, and a public works academy was being established, in collaboration with the Department of Higher Education, to train young consultants over a period of time. A commitment was made to address the issues raised. On the issues affecting the 1 Military Hospital, the most important thing at the moment was how the project would be completed.

Mr Maroga, responding to the question of ICT, said that the Department was rolling out a property management platform. The Department was not where it should be with regard to ICT, but it was definitely rolling out a plan which would deal with all the questions related to service delivery.

Regarding the six months’ turnaround plan, this was not a total turnaround time. On the issue of funding for property, the concept was that of a user management asset plan, which made the user provide for capital, provided by National Treasury, while the DPW was responsible for the management of such property

On the issue of capacity, he acknowledged the shortage of both financial and technical capacity in the DPW to fulfil its mandate.

Mr Thobakagale referred to the issue of fencing, and said that there were security specifications which had to be fulfilled, and there were very few contractors in the private sector who could meet those specifications. This was the primary reason for the delay in the projects for the security cluster. He promised to send a comprehensive report to the Committee on this.

On the supply chain process, there were regional offices with regional supply chain members. There was a separation of responsibilities between the regional and national offices. Risk assessments of the contractors were carried out during the tender process, and while the contract played itself out in real time, certain factors weighed in and became a challenge in the course of the project. One of the challenges included the employment of locals with the requisite technical abilities. The tender process was designed in such a way that the lowest bidder got the job, but this becomes a problem sometimes when the contractor comes back to try to adjust the contract cost because of increases in cost. Since these contractors sign contracts with the DPW, the Department always ensures that contracts were terminated within the legal context, and this had also led to a lot of delays in the execution of contracts.

The meeting was adjourned.

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