The Committee met to consider a draft consolidated report of all its work to date regarding the intervention into the provincial Government of North West Province, in terms of section 100 of the Constitution.
It observed that National Treasury (NT) remained concerned about the province’s under-spending on the Human Settlements Development Grant (HSDG) and the Provincial Roads Maintenance Grant (PRMG) due to poor planning, which had been a trend in the North West (NW) for the past two financial years. Also concerning had been the lack of disciplinary action in respect of consequence management, although investigations were ongoing and some had been concluded.
The Auditor-General of South Africa (AGSA) had found regression in audit action plans, usefulness of indicators and targets, internal audit units, and committees and coordinating departments. Five departments had incurred 92% of the irregular expenditure in NW, and the provincial public accounts committee (PPAC) had failed to take appropriate action to ensure proper investigation of irregular expenditure and the institution of consequence management.
The Chairperson said the Committee would undertake an oversight visit to NW to get physical evidence as to the need for, and continued process of, the intervention. It would then be able to determine whether it needed to be continued and for how long. All that work and progress would be reported to the National Council of Provinces (NCoP) regularly
Presentation on intervention in North West Provincial
Mr Tshepo Masoeu, Content Advisor, Parliament, outlined the presentation and read through it for the Committees benefit (see document).
He said National Treasury (NT) remained concerned about the province’s under-spending on the Human Settlements Development Grant (HSDG) and the Provincial Roads Maintenance grant (PRMG) due to poor planning, which had been a trend that had been in the North West (NW) for the past two financial years. Further concerning for the NT was the lack of disciplinary action and consequence management in respect to compliance with legislation, although investigations were ongoing and others had been concluded.
The Auditor-General of South Africa (AGSA) had found regression in audit action plans, usefulness of indicators and targets, internal audit units and committees, and coordinating departments. The audit outcomes for the five Departments under section 100 (b) indicated that they had incurred 92% of the irregular expenditure in NW, and that the provincial public accounts committee (PPAC) had failed to take appropriate action to ensure proper investigation of irregular expenditure and institution of consequence management.
The root causes for accountability failures had been management’s failure to respond with the required urgency to improve audit outcomes, and the lack of political will to ensure accountability and consequence management.
Ms L Zwane (ANC, KwaZulu-Natal) said that the Department of Basic Education (DBE) had already introduced and installed an administrator to the North West Province in response to challenges in that province’s DBE. She asked whether the Committee’s perspective and recommendations would be similar to those of the Inter-Ministerial Task Team (IMTT), or different from what the IMTT would have produced.
The Chairperson said the Committee would follow the money. What the IMTT had done had been to complete the analysis, and the Committee’s other work would be to monitor the intervention until its completion.
Mr M Khawula (IFP, KwaZulu-Natal) said he had missed in the presentation the observation where the failure to spend by the NW Department of Local Government and Human Settlements( DLGHS) grants had resulted in that Department forfeiting its allocation. The Department of Community Safety and Transport challenges had been delimited by the IMTT, which had said it was the transport component that had immense challenges and not the other component of that Department. He said that the Committee’s presentation had to capture both observations accurately.
The Committee had also observed that accounting officers had to be treated as such for accountability purposes, and that departments had to be distinct, because the NW had had a challenge of combining functions together. The Department of Health in NW had also been found to be performing above national targets in its areas of performance.
Mr M Monakedi (ANC, Limpopo) suggested that preliminary observations had to be clearly delimited as coming from the Committee, and not the IMTT. He also proposed that the term ‘regularise’ be replaced with ‘improve’ or ‘restore’ services. Finally, he proposed that the clause ‘other stakeholders’ be used instead of ‘all stakeholders,’ as there surely would be those who could take the Committee to task about never have being consulted on the intervention.
The Chairperson said ‘preliminary observations’ ceased being preliminary after presentation to the Committee, and became the Committee’s views.
Adv Frank Jenkins, Parliamentary Legal Advisor, said the Committee had to be clear what its role was, as the intervention was a national executive task. The Committee’s mandate was to monitor and oversee whether the intervention had been necessary, how long it would remain in force, and whether the IMTT was getting to the bottom of why the NW had been non-compliant with financial management legislation and irregular expenditure for so long and consistently.
The Chairperson said the Select Committee for Finance and Appropriations had undergone an exercise with the nine provincial treasuries on the issues of governance and accountability, especially regarding expenditure. The Constitution, together with the new Public Audit Amendment Act, would assist AGSA and Parliament in ensuring accountability for unauthorised, irregular, fruitless and wasteful (UIFW) expenditure by all state departments, as well as consequence management. The Committee would undertake an oversight visit to NW to get physical evidence as to the need for, and continued process of, the intervention, whereafter it would be able to determine whether it needed to be continued and for how long. All that work and progress would be reported to the National Council of Provinces (NCoP) regularly.
Adv Mongana Tau, Committee Secretary, said that after the oversight visit and engagement with stakeholders, where possible the Committee would be able to observe whether the intervention had been warranted or not to date.
Mr S Mohai (ANC, Free State) said the presentation had captured well what the Committee had done to date. Clearly the oversight was needed, but the follow-up meeting with the IMTT was most important.
Mr Khawula asked for the possible dates for the oversight to NW.
The Chairperson replied that the Management Committee (MANCO) was proposing some time in September, because of the National Council of Provinces’ (NCoP) programme ,which the Ad Hoc Committee had to work around.
The Committee considered its draft minutes for 27 June 2018.
The minutes were adopted with technical and grammatical amendments only.
The meeting was adjourned.