School infrastructure: update on ASIDI, with Deputy Minister

Meeting report

Accelerated School’s Infrastructure Development Initiative (ASIDI) briefing

DBE Deputy Minister, Enver Surty apologised for the Minister’s absence due to overseas travel. He agreed with the Chairperson on the importance of solving infrastructure problems. He referred to the Accelerated Schools Infrastructure Delivery Initiative (ASIDI) and its task of replacing “mud schools” and providing sanitation, hailing the recent completion of 25 new schools in the Eastern Cape. Its administration involved weighing up quality and quantity of projects, as well as dealing with agencies and contractors that had been underperforming. Other issues had been caused by the dependence on the Department of Public Works (DPW), causing friction in the Western Cape, and switching completely to outsourcing in the Free State instead. Mvula Trust had proved to be the most efficient partner so far. There are many areas of concern, however, especially in rural parts of Limpopo, Mpumalanga and the Eastern Cape. Many of these are linked to strained human resources, as these posts are unpopular. They are also natural challenges caused by terrain, which impeded infrastructure development and transport access. The Eastern Cape faced a “rationalisation” issue, where the 5 000 schools in the programme were being reduced to 4 000, through consolidation. Not every “mud school” would be replaced with a new facility and 125 “state of the art” schools with libraries and laboratories had so far been built in the province.

Rationalisation involved complicated planning and consultation and often conflicted with communities that insisted local schools remained open, even if there are only “12-13” pupils that attended. Furthermore, contractors that had been successful on urban projects were less reliable on those in rural areas. DPW had not made progress in the last two years, but where it had been dropped in favour of other contractors; there had been some improvement in the last six months. Another issue was the failure of contractors to complete projects. The 5% fee withheld until the end has not proved adequate motivation as many moved on to other projects rather. The Department has decided to increase this fee to 20% in order to better encourage completion. Big schools with at least1 500 pupils required multi-year projects to build. Migration was causing issues do to the difficulty of not knowing how many pupils will be in a particular area in the near future. The Eastern Cape had seen the best improvements, while the cost of rebuilding existing schools burnt during protests in Limpopo had exhausted that province’s budget. Storm damage had also been costly there and in Mpumalanga, where additional funding would be needed to for development on top of the maintenance currently carried out. Besides that, an approximate 85% success rate was currently being enjoyed with the completion of infrastructure projects. What has been a “sad story”, was actually improving greatly. Most provinces were guilty of not adequately using their own division of revenue funds though, and were relying on the department’s national level allocation of ASIDI funding to pay for projects. While not exciting, there was hope of improvement. Infrastructure was actually a distraction, as the Department should be focusing purely on education. If only there was an efficient DPW that could fulfil the function it was supposed to.

The Chairperson thanked the Deputy Minister and referred to ASIDI.

Mr S Mafoko, Acting Chief Director, ASIDI, emphasised that ASIDI was only responsible for 25% of funding, and the rest fell on provincial education budgets. A problem had emerged where provinces have used ASIDI to fund operating expenses instead of development, and have left their own funds which should have been used, untouched. Development in Limpopo had stalled because all funding had been diverted to maintenance required after flood damage. Only 18% of current projects had actually been completed, while the vast majority are stuck in the pipeline - delayed at various stages of planning or construction. He expressed agreement with the proposal to increase contractors withholding fees from 5%, in order to encourage completion of work. In certain cases this had already been increased to 25%, and had yielded improved results. In future, there would have to be better insurance plans, to cover the cost of future damage, such as that caused by flooding. More projects had been completed in the Eastern Cape than any other province, and there had been impressive improvements in the overall implementation process there. The 2017/18 financial year was focussed on the construction of more classrooms for the increasing number of pupils. Plans would have to be significantly adjusted, however, due to the recently introduced spending cuts which would be staggered over the next three years. Schools have to present their business plans to the department by September, which then confirms or adjusts them by December. Readjustments to current plans and priorities would need to be made by the end of March, before the start of the next financial year, especially now because of the spending cuts.

Water and sanitation work had been taken away from the department and awarded to Mvula Trust, which had produced better results. All 372 electrical projects had, however, been completed. Verification was still outstanding for 21 of these, but should be produced within the month. An issue which had arisen is that schools’ bank balances showed all payments made to contractors for ASIDI projects immediately, but departmental accounting of the details of each project took a long time to catch up with and correlate with this financial information. He then concluded the presentation by showing MPs a range of pictures of projects at various stages of completion from all over the country.

Discussion

Ms C Majeke (ANC) asked what the state of safety and security was like at the schools in question.

Ms N Tarabella-Marchesi (DA) asked the Deputy Minister for the specifics of what parts of the 25% funding that ASIDI provided went towards what expenses. She also asked who specified the aims of ASIDI, and what role the individual provinces had in this.

Ms J Basson (ANC) thanked Mr Mafoko for the results that he had shown the Committee. She asked what the names of the specific schools and provinces were that had shifted costs away from provincial funds to be covered by ASIDI instead. She also asked who was responsible for monitoring these funds, as well as whose responsibility the low percentage construction completion rate was.

Ms H Boshoff (DA) referred to the amounts allocated on slide two of the presentation and asked why this was the case when there were budget cuts. She then referred to the 38 projects completed and 38 under construction in Mpumalanga, disputing that this was the case. She asked if Mr Mafoko had been to Mpumalanga saying that the results were either incorrect or from urban areas, but could not be from rural areas. She then asked what provisions had been made for school transport, and what the state of special needs schools was, as neither of these issues had been mentioned.

Mr X Ngwezi (IFP) referred to the difficult environments in which schools were situated, acknowledging the difficulty for construction and for access, but asked what was to be done for locals and for communities. First, they would need roads, and other departments needed to be made use of to create access, so that education could be implemented. Visits to these schools had shown that there was a lack of toilets. JoJo tanks have been used as makeshift septic tanks. No one, especially district managers, was being responsible. One day, “communities would attack them” because of this. Visits to families in rural areas showed bad results. There were 800 ongoing projects, but nobody seemed to know what was happening. They needed to “get closer” and help communities deal with issues such as chiefs interfering. He said one community he had visited had been promised a school by the Department 15 years ago, but it was still waiting. He did not know what the procedure was to nominate schools to ASIDI, but this community must be very patient. He asked the Deputy Minister if he needed the Committee’s help in changing the fee percentage held back from contractors in order to encourage them to complete their work.

Mr H Khosa (ANC) took issue with “state of the art” schools, saying it was better to allocate fewer funds to build simple classrooms and toilets at more, already existing, local schools. He also referred to the issue of flood damage, asking how schools were to deal with this, as the problem continued every year.

Mr I Ollis (DA) referred to the R3.5 billion spending cuts and additional R3.5 billion after that again. If they had thought it was bad previously, this was going to be an infrastructure nightmare because there was no money. It would be “the biggest crisis since 1994”. He asked how the Department was going to manage. Clearly money was being spent on something else. Schools would fall apart because of this.

Ms N Mokoto (ANC) said the Department “needed a hiding”. The table being presented needed an additional column, stating the actual stage of completion of the projects in question. There also needed to be accounting for the backlog in implementation. He was impressed by the improvement since last year’s meeting’s chaos and anger. He asked how the targets were going to be reached. In terms of the DPW delays and difficulties, he asked whether the fault lay at a national or provincial level. He then asked how much money had been lost through litigation over the withdrawal of contracts.

The Chairperson asked where mobile classrooms fitted into the report. They were expensive, so she asked if they were being counted in the figures that the Committee was examining. The overall question was how big was the backlog, and what was the need of the department. That would affect the budget. Maintenance, storms and other such expenses would always be there.

Ms Tarabella-Marchesi asked how contractors were paid, and why it was that they hurried to start other projects.

The Chairperson asked where multi-year projects and targets fit into annual financial reviews, and how their progress was monitored.

Mr Mafoko responded and said on the multi-year projects, it was important to distinguish between the variety of sizes of schools involved in ASIDI, and the pictures in the presentation had helped to demonstrate this. As for payments, these were made according to what was allowed by the contracts which had already been signed and were binding. The increase from 5% to 20% fee retention until the completion of work was being implemented already, and contractors were being told of this with their lawyers present. An additional precaution was also being taken by blacklisting contractors that did not complete their work, and preventing them from doing any more work for the Department, even if it was in another province. This had already caused a rush to complete outstanding work. An estimated R40 billion would be needed to provide the different kinds of facilities required by grade R pupils. A precaution was being taken on where developments were being made in rural areas, as significant rural-urban migration risked expensive schools not having enough pupils to attend them from surrounding communities in the near future. Better online records of numbers of pupils from each area were needed and 85% of the budget went towards the remuneration of personnel, and the remaining 15% went towards expenses such as maintenance. Referring to Mr Ollis’ statement, he said that he would need to speak to Treasury soon to find out what provincial branches of the Department would actually be able to afford.

As for mobile classrooms, he said these were being avoided as much as possible because they were as expensive as constructing new “brick and mortar” ones, and so were only being used in emergency situations. The 20% fee retention and blacklisting policy seemed to be enough of a strategy plan, without extra assistance from the Committee, although attention had to be paid to drafting future contracts more carefully. The reward of future work to contractors that performed well was also proving an effective strategy, as was demonstrated by the partnership with Mvula Trust. As for storm damage, which was an annual event, the problem was significant as permanent, modern classrooms were being washed away just as easily. A special emergency fund to cover maintenance would need to be created. The division of the 75% of funding outside of ASIDI was actually beyond their control, as it was administered by provincial branches. He apologised for the lack of attention on special needs, saying that the issue needed to be raised. Urban bias over rural concerns was in most cases caused by the lack of access to rural areas. For issues even beyond the Department’s responsibilities, he praised the Minister’s cooperation and coordination with other government departments and even the army, to build bridges and improve access. The security issue had been looked at, and the Department was trying its best to ensure it at all schools. Once ASIDI projects were completed, they are handed over to school management, meaning that some lapses on issues such as security took place beyond the control and management of ASIDI itself. Finally, he addressed Mr Ollis’ concerns, confirming that there was a combined R7.3 billion budget cut, saying that “the system was collapsing” as a result.

Mr Ollis asked for clarification on whether the R7.3 billion was only from the national budget, and if the provincial ones were cut separately.

Mr Mafoko confirmed that this was the case. The cuts being discussed are only “the tip of the iceberg”, at national level and there was others at all levels of government. In KwaZulu-Natal, the Department was already unable to meet its obligations, and salary negotiations had started. Discussions would be needed with urgently with the Treasury. The way budgets were announced highlighted the increases and hid the cuts. Specific functions were hit worse than others. The curriculum project, at the core of the department’s educational mandate, was funded entirely by donors, especially the European Union.

The Chairperson commented that soon the Department would have no operational funds, and there would be a crisis.

Mr Mafoko added that additional funding was required simply to oversee and monitor the functions of the Department, especially because of the lack of technological capacity. Despite R12 billion worth of current projects that it was responsible for, it did not have adequate teams of people to check up on them. Architects, quantity surveyors and other professionals were needed on a permanent basis. The DPW not have the capacity to do this either. As for the weather, cooperation would be necessary with the Department of Science and Technology (DST) and the Council for Scientific and industrial Research (CSIR) to develop structures that would be able to resist flood damage, if they could not be moved to alternative locations.

The Chairperson pointed out that there were only 35 minutes left to the meeting.

Mr Ollis said that the committee had taken on too much, and would have to leave the quarterly reports for another meeting.

Mr Khosa said that in future it should be done like this, but that they should still ask some questions today.

Ms Machesu disagreed, saying that they did not have the time.

The Chairperson asked that the album of pictures from the provinces be finalised for the Committee, then called the meeting to a close.