DAFF Quarter 1 performance; ARC audit action plan; DAFF response to oversight visit reports; with Minister

Meeting report

2017/18 audit outcomes: Agricultural Research Council

Mr Senzeni Zokwana, Minister of Agriculture, Forestry and Fisheries, apologised for delaying the start of the meeting, saying he had just arrived from the United States where he had attended the a wine symposium in Florida. The flight had arrived at 9 am, hence the delay. He handed over to Dr Shadrack Moephuli, Chief Executive Officer: Agricultural Research Council (ARC), who invited Ms Maureen Manyama, the new Chief Finance Officer of ARC, to present the audit outcomes arising from the annual report 2017/18.

Ms Manyama began by highlighting that 118 audit findings had been raised. In terms of the audit outcomes for the year 2018, 19 had been identified to affect the audit opinions, and a number of issues had been identified by the Auditor General (AG) for qualification.

There were misstatements in the financial statement. As such, there was a need to ensure that there were adequate financial management skills and resources available. The entire staff in the finance unit, even at the central office, had to be reassessed. By extension, the AG had also raised the issue of implementing and instituting strict monthly control disciplines for all general ledger account balances, as well as disclosure items. As an illustration, these controls may include conducting reconciliations on a monthly basis.

As an organisation, the ARC needed to put measures in place with regard to dealing with transgressions of the law, performance that was unsatisfactory/poor, and non-adherence to the control disciplines in place.

Ms Manyama said another key area of concern with regards to misstatements in the annual financial statements had been the current Microsoft AX enterprise resource planning system. The system had been noted to be deficient and was consequently giving problems. This was an issue that required to be rectified as it affected the integrity of the reports being reported.

There was an urgent need for the standard operating procedures to be developed and rolled out to the appropriate staff members for all business processes. Additionally, key financial staff in decision making capacities must be well equipped.

The ARC priority areas for improvement in the audit improvement could be listed as follows:

• Audit of predetermined objectives: the entity needed to revise its currently approved 2018/19 business plan and obtain approval for the amended business plan;
• Information Technology (IT) governance and IT system controls;
• Governance could be enhanced by the audit committee
• The audit committee must use internal audit more effectively;
• Management should be held accountable for delivering on commitments and actively working towards creating an environment for good internal controls.

In response to the auditor’s review, a progress improvement plan had been devised by the ARC with a number of interventions, some of which were already under way.

The first area of improvement was to revise the delegations of authority framework for all senior management, which incorporated Section 57 of the Public Finance Management Act (PFMA). By incorporating the PFMA, people were aware that they had responsibilities towards ensuring that there was an effective and efficient internal control, and also to making sure they complied with the legislation and policy of the organisation. Letters had already been disseminated and this was a work in progress.

Reviewing job profiles and role clarifications of the finance team was the second priority area. It was anticipated that the process would be completed in a month’s time.

The third intervention/area of improvement dealt with the annual financial statements (AFS). The ARC was currently busy with the mock/interim year end statement in order to address the AFS disclosure-related findings.

Issues of property, plant and equipment was still a work in progress as they were still far off in terms of what needed to be done. Current progress on property, plant and equipment revealed that:

• A draft asset management policy had been prepared.
• Title deeds for land had been obtained and linked to land per the fixed asset register (FAR).
• Terms of reference for the service provider were in draft.
• Monthly reconciliations between the FAR and the general ledger (GL) had been prepared. Asset verification was still to be conducted.

All other finance policies and standard operating procedures were yet to be tabled at the upcoming audit and risk committee, and a target set for final approval by the council was the end of November.

Concerning receivables from exchange transactions, the credit management policy had already been approved and the recovery of long outstanding travel advances was in progress.

Regarding supply chain management (SCM), the Department had identified all irregular expenditure and investigations were under way by the relevant institutes. The contract registers, as well as a fruitless and wasteful expenditure register, had already been established. Upgrading and/or re-implementing the Microsoft AX system was another priority area in the ARC audit improvement plan.

The last intervention was on consequence management where there had been identification of poor performance, irregular expenditure, fruitless and wasteful expenditure.

The presentation was concluded with an outline of the critical success factors that would ensure that the ARC achieved a positive audit outcome. These were:

• Development and implementation of updated policies and procedures;
• An upgraded enterprise resource planning (ERP) accounting system;
• Improved monthly reporting process and monitoring;
• Cooperation and collaboration from junior levels up to executive management levels;
• Defined roles and responsibilities;
• Adherence/compliance to prevailing policies and procedures;
• An improved culture, which pursues good governance at all times and effective decision–making;
• Consequence management.

Dr Moephuli commented on the current initiative under way to engage a service provider on the Information Technology (IT) system. A number of proposed solutions had been provided and it was anticipated that the problems would be resolved within a few months.

Discussion

Mr H Kruger (DA) wanted clarification on the organogram of the ARC. He wanted to find out how many vacancies in skilled posts the organisation had, such as plant breeders, among many others.

Another issue raised by one of the Members was about the progress of the audit improvement plan. The Department was asked to provide an indication of the actual timeframes when the Committee should expect the results.

Mr N Paulsen (EFF) raised a concern on the credibility of the figures that were presented in the audit findings, since the system was reported to have defects and was not functioning effectively. He questioned the credibility of the figures and enquired about the anticipated timeframe for the system problems to be resolved. Consequence management was another issue of concern, in terms of the information technology (IT) system. He wanted to find out what the consequences for the people in charge of that IT system would be.

Mr N Capa (ANC) asked for clarification on the form of consequence management to be incurred. His other area of concern was the performance, which was the main issue the ARC was facing.  He asked where the challenge lay – were the people employed by the ARC were lacking in qualifications, or had the development of technology overtaken the capability of the responsible department staff?

Mr M Filtane (UDM) recalled that during the past Committee meeting, he had asked the ARC about the steps they were taking to close the gaps in the critical staff. What was the current plan to close the gap? The previous response provided had been simplistic, in that it had been stated that “the government standard procedures would be followed when such gaps occur.” That response was unsatisfactory, as it was assumed that there would have been more creativity that the ARC should have taken to go beyond the standard government methods.

He referred to the ARC audit improvement plan priority areas, and asked about the anticipated timeframe in which the ARC expects to get approval of the business plan, since it was considered the essence of their operations. Without approval of the business plan, it would be just mere speculations.

He wanted to establish how was it that employees had failed to comply with legislation, and whether it had been possible to identify the transgressors. Legislation was passed in Parliament to enable institutions like the ARC to operate smoothly. As such, it was questionable how someone at the administration level could transgress that service.

He was amazed that an institution like the ARC, which had been in operation for so many years, had been operating without proper policies and procedures.

ARC’s response

Dr Moephuli pointed out that three key executives in the organisation’s structure had resigned -- the chief financial officer (CFO), the financial manager and the executive responsible for IT. The resignations had affected the overall organisation in the sense that overall progression had been hampered to a certain degree. Consequence management had always been in existence, but the resignations and general situation had affected its implementation.

Concerning the organogram, with the capability to deal with issues such as the number of plant breeders or other key roles, the ARC had a system in place, with a database, and it was the norm to conduct an analysis.

Regarding the audit improvement plan, the ARC would have liked to have resolved all the issues. However, some of the issues pertained to data that was in the old system, so a plan with timeframes would be formulated and provided at the next Committee meeting.

Regarding the ERP system, he provided a background and the context in which the ERP system originated. The ARC had been established as 16 separate institutions, each with their own financial system. In the past, they had never been provided with funding to set up an IT system that integrated everything. As a result, the organisation had taken an initiative internally to save money and had come up with one of the best IT financial systems that could be installed in the organisation. The system had taken two and a half years to install. During the period where they wanted to develop the financial statements for the year, they had discovered things had not come out right or as planned. Some of the issues discovered, as had been reported at the previous meeting, had required establishing contact with the manufacturer of the system, and the manufacturer had come to rectify the issues. A number of solutions had been presented by the manufacturer, some of which had involved re-implementation of the system or upgrading the system. The decision of whether to upgrade or re-implement the software would be made within two weeks.

In responding to what forms consequence management had taken, he said it varied depending on the nature of what was being considered as a transgression. In certain instances, a warning (verbal or written) may be issued while in others it may be a dismissal. The HR procedures were followed with regard to issues requiring disciplinary action.

Concerning the issue of qualifications, the current situation did not necessarily imply that people did not have suitable qualifications, but rather that there was need to have the right skills. Procedures and practices changed over time, so as financial gurus, people needed to undergo training so that they were not outdated.

An area of concern that had been raised and had been reported numerous times to the Portfolio Committee was that the ARC was under-funded. Consequently, this affected the availability of the required skill sets at the ARC. On the organisation’s part, there was a need to be prudent and creative in the event that a staff member was off on sick leave. There was a need to improvise even for certain functions when individuals were put in acting capacity to fill a role on a part time basis. As an illustration, during the previous Portfolio Committee meeting, the ARC did not have staff filling the position of CFO and an internal audit, but had staff in an acting capacity.

The issue of non-compliance with legislation could be described as tricky in certain instances. This was mainly because the National Treasury upgrades its rules within very short timeframes and some of the upgrades made may not have been made known at the time, or how they ultimately affected the financial statements. They had been made to realise only at a later time by the Auditor General that certain Treasury regulations had not been given much attention.

On the matter of policies and procedure, the ARC did have policies and procedures in place which the AG had recognised. However, the issue raised in the management and audit report was that there were certain weaknesses in the controls. As such, the ARC was reviewing and revising policies and procedures in order to ensure and fix those areas where they were weaknesses and concerns.

Ms Manyama added that some of the policies were very old and things had evolved and changed. Therefore, there was a need to update and change some policies.

The Chairperson asked the Committee Members for further clarifications or follow up questions.

Mr M Filtane (UDM) responded that he was happy with the responses. On the issue of filling in for people and the shortage of funding, he remarked that the Minister was present, so these challenges could be worked on between the two of them to find a solution when going into the year 2019.

Department of Agriculture, Forestry and Fisheries (DAFF): First quarter performance

Minister Zokwana said the framework for the DAFF’s programme performance management information puts an emphasis on the Department demonstrating accountability and transparency in the use of public funds in delivering services. The law required the Department to be submitting preliminary reports and in line with that, the report presented was in compliance with the law.

Mr Joe Kgobokoe, Deputy Director General (DDG): Policy, Planning, Monitoring & Evaluation, DAFF, highlighted the status of the various medium term strategic framework (MTSF) targets for the first quarter. The key achievements were:

• 300 000 jobs were created;
• One million hectares of previously unutilised land was currently under production;
• 80 000 smallholder producers were supported;
• 152 500 hectares of land were under rehabilitation;
• 1.6 million households were benefiting from food security and nutrition.

In summary, the DAFF had achieved 74% of its targets. The Department attributed the non-achievement of certain targets to the delay of evidence from the provincial Departments of Agriculture (PDAs). The vacancy rate had also risen from 14.9% to 16%. Key performance indicators developed for specified human resources (HR) priority areas had included the repositioning of HR as a strategic partner to enable DAFF to achieve its strategic objectives, the employment of the youth in the agriculture, forestry and fisheries (AFF) sectors, and the transformation of the workforce. Last HRIt had identified the need to manage the challenges of an ageing and ailing workforce.

The DAFF had made significant progress and achievements in the six programme areas. Focus would, however, be placed on the targets not achieved within each respective programme. It gave reasons for non-achievement.

Programme 1: Administration

The target of implementing media plans was not achieved. The media plans comprised of National Assembly and National Council of Provinces (NCOP) budget votes, Youth Month/#YAFF, World Oceans Day and Imbizo Week. These were not implemented within the specified time frames.

Programme 2: Agricultural Production, Health and Food Safety

Mobilising farmer participation into the Kaonafatso ya Dikgomo (KyD) and poultry schemes was not achieved in its entirety. On the one hand, 970 farmers had been mobilised for KyD and were awaiting validation, while on the other, poultry farmers had not been mobilised. This had mainly been attributed to the training delays by World Poultry Foundation (WPF). The activities which were towards the achievement of the mobilisation of poultry farmers had fallen outside the timeframe for quarter one.

There had been inadequate information to inform the report on regulatory interventions implemented  for quarantine, inspections, surveillance and testing. For instance, sample validation documents at entry points had been in progress at the time and were anticipated to be finalised by mid-September. This had now been accomplished.

The first draft of the animal identification and traceability policy was supposed to be developed by first quarter, but this had not been completely achieved due to delays related to the issuing of the socio-economic impact analysis (SEIA) certificate by the Department of Performance Management and Evaluation (DPME).

The final target not met was the monitoring of the community-based indigenous goat conservation projects in Limpopo. The project in the Waterberg District was still in progress during the first quarter. This was due to the validation of identity documents (IDs) of farmers, which was in progress at the time. The target had since been achieved in Quarter Two.

Programme 3: Food Security and Agrarian Reform

The quarterly report on national food and nutritional security interventions had not been completed. This was also attributed to the ID validation of farmers which was in progress.

Programme 4: Trade Promotion and Market Access

Programme 4 faired reasonably well, as all targets stipulated in the first quarter had been achieved.

Programme 5: Forestry and Natural Resources Management

Consultations with communities on the options for adopting the establishment of the six legal entities had not taken place. The DAFF had needed to first take a decision on the legal entities that were to be established for recommissioning before the consultations could take place. A meeting was held on 25 June, where a decision was taken to form a trust as opposed to a Community Property Association (CPA).

In addition, the Climate Smart Agriculture (CSA) strategic framework was not gazetted for public inputs and comments within the planned timeframe due to the prolonged consultations during the process of approval, which had led to delays. This target had, however, been achieved in the second quarter.

Programme 6: Fisheries Management

The draft regulation 5(3) report to support the fishing rights application process (FRAP) 2015/16 appeals process had not been done. In addition, the target to register outstanding small scale fisheries cooperatives had not been achieved. Likewise, the target to have 875 compliance and enforcement measures in the six prioritised fisheries was not fully implemented. Only 482 inspections had been conducted, of which 369 were compliant. Inspections not conducted amounted to 393. Considering that this was the third quarter of the financial year, the inspections had now been conducted.  The reason for all these targets not being achieved was due to finalisation delays within the specified timeframe.

Mr Joe Kgobokoe highlighted the Department’s staff age profile. Of the 5 543 employees, the highest number were within the age group of 50-54 (811), followed by the 40-44 age group (811) and then the 55-59 age group (779). The age group with the least number of staff was aged 20-24, with a total of 96 employees. The majority of the DAFF employment equity profile were African males and females, with a share of 37% and 33%. The white female and coloured male share was only 4%, the white male and coloured female was 3%, while Indian males and females made up a very minute share.

Mr Jacob Hlatshwayo, Chief Financial Officer (CFO): DAFF, said the Department’s total annual budget was R7.165 bn, and the expenditure in the quarter had been R1.823 bn (25.4%). Expenditure per programme had been:

• Programme 1: Administration - total budget R923 m; expenditure R371 m (40.1%).

• Programme 2: Agricultural Production, Health and Food Safety - total budget R2.4 bn;  expenditure R607 m (25.3%).
• Programme 3: Food Security and Agrarian Reform - total budget R2. 038 bn; expenditure R271.5 m (13.3%).
• Programme 4: Trade Promotion and Market Access – total budget R273.9 m; expenditure R95.8 m (35%).
• Programme 5: Forestry and Natural Resources Management – total budget R1.075 bn; expenditure R252.3 m (23.5%).
• Programme 6: Fisheries – total budget R487.8 m; expenditure R225.4 m (46.2%).

Mr Hlatshwayo provided reasons for the over/under spending on each programme. These were

• Programme 1:Exceeded the target due to a number of payments that were made, such as payments in arrear for accommodation charges for state-owned buildings related to the previous year, leases for privately owned buildings, municipal fees, and payment was also made to Stats SA for an agricultural census project.
• Programme 2: Double payment to Agricultural Research Council, and quarter 1 payments for conditional grants to provinces for Ilima/Letsema were made.
• Programme 3: Quarter 1 payments to provinces in respect of Comprehensive Agricultural Support Programme (CASP) conditional grants were made. Payment to the Land Bank to boost the agriculture sector by supporting small emerging farmers would be made in quarter 2.
• Programme 4: Once off payments to the National Agricultural Marketing Council and membership fees to international organisations were made.
• Programme 5: Quarter 1 payments to provinces in respect of Land Care and CASP conditional grants were made.
• Programme 6: A once-off payment to the Marine Living Resources Fund for vessels operations was made.

Mr Kgobokoe informed the Committee about the status of the Highly Pathogenic Avian Influenza (HPAI) H5N8 in South Africa. Due to a number of outbreaks detected and reported in various locations in the country, it had affected the export of poultry. A number of countries had banned South African poultry as a result of the outbreak. Some of these countries include Russia, the United Arab Emirates, Namibia, Botswana, Israel, Hong Kong, Norway, Iceland and Switzerland. The major concern with the trade partners was that there was high probability that vaccination would mask the infection with HPAI.

Discussion

The Chairperson asked for further clarification on the constant reference in the presentation to activities that had happened but were not confined to quarter one, as it was meant to be about quarter one only. Justification had been given as to why some activities had been reported as concluded during the course of the presentation. Currently, it was quarter three; so even though the report was for quarter one, some activities not concluded had been concluded in the second quarter.

Mr P Maloyi (ANC) said he did not appreciate the report was being made on issues that had not been validated. What was making matters worse was that the DDG was presenting a report that was outdated, as most issues had already been achieved.  He asked about the procedure that was followed when drafting the annual performance plan. His main concern was that the report presented was outdated and that the set targets were not achieved. The assumption in setting targets when drafting a report was that the “SMART” principle -- Specific, Measurable, Achievable, Relevant and Time-bound -- was used. Therefore, it was an error to set targets that one knew for certain would be achieved only in the second or third quarter. He asked why the Department had set plans and targets that were not achievable before interacting or presenting to the committee. He also asserted that some of the slides were the same as those which had been shown to the Committee previously, and he did not like it being assumed that Members did not read or follow what was being presented.

Mr P van Dalen (DA) referred to a court case on involving the World Wildlife Fund (WWF) in recent months, which the Department lost, on the total allowable catch (TAC) set for West Coast Rock Lobster (WCRL). He wanted to know if the DAFF was going to adhere to the court ruling or planned to appeal. Along the same lines, the media was reporting on the handling of confiscated abalone -- what was the Department doing to better protect the abalone stocks that were in its possession? What was the disposal process and what income was derived?

Mr H Kruger (DA) referred to the establishment of cooperatives. A report from the Department of Trade and Industry (DTI) indicated that 88% of all cooperatives fail in South Africa. What was the DAFF doing to ensure that cooperatives were successful? There was a target of establishing three cooperatives per quarter, but given the large number of people unemployed, there was a need to double or even triple the government’s efforts and targets. The plea to the Department was to change that target to nine, as opposed to three per quarter.

Mr S Mncwabe (NFP) had found the presentation of the employment equity profile confusing and difficult to understand to be able to draw proper conclusions.

Mr N Capa (ANC) brought up the same issue the Chairperson had raised on targets achieved in the second quarter. He believed the presentation would have made more sense if it had been indicated in the quarter one report that certain targets had not been achieved but would be achieved in the second quarter. It seemed that not much effort was being made to ensure that the provincial department complied and made the needed information available in order for Department to perform. He wanted to find out how the DAFF intended to measure the key performance indicators (KPIs) to ensure that they were all achieved. There had been constant mention of validation – what was the progress in that regard? He would also like clarification about the structure of the cooperatives.

Mr A Madella (ANC) wanted information on the 875 compliance and enforcement measures implemented in the six prioritised fisheries sectors. There was no indication as to reason the target had not been met. On the issue of employment of people with disabilities, only 1.1% were employed, and they were institutions with sufficient information on graduates or qualified people with disabilities, so he wanted to know why the rate was still low.

Mr M Filtane (UDM) emphasised that the overall purpose of the government was to take care of the social needs of the people. He asked if the DAFF planned to address the issue of food insecurity in South Africa, and if it had programmes focusing on the landless and foodless. Referring to the 16% vacancy rate, he said he understood two-thirds of the national fiscus was consumed by staff compensation costs.  However, even though there were staff shortages, the government still continued to spend more funds for paying civil servants. He wanted to find a solution to that issue, as the DAFF also contributes towards the 35% of national spending on staff compensation. Referring to the staff age profile, there were 322 staff aged between 60 and 64, which constituted about 6% of the employment in the Department. What standard was set by the Department of Public Service and Administration for people who were over 60 years of age in such an establishment?

The Chairperson asked how the Department intended to deal with challenges such as the high vacancy rate. She reiterated that it was inappropriate to make reference to issues achieved in other quarters, as it may be confusing to the Committee. If targets were not achieved, it was more appropriate to just give reasons as opposed to indicating that they had been achieved in other quarters.

On issues of validation, it was surprising to note that people were given projects without an ID validation. It was an error for a person to enter a system without an ID, and such issues had to be rectified. Regarding monitoring and evaluation (M&E), she wanted an explanation on the framework being followed -- how the department monitors the implementation of its programmes in terms of performance.

It had been reported that there had been no assessment of management for four years. Did the managers have performance management contracts, and what was being done? She asked for an update on the assessments, and to see if the performance contracts of executive management were actually in existence.

DAFF’s response

Minister Zokwana responded on whether the Department intended to appeal against the WWF judgment. He said that the judgment would cost the government, because it had placed the onus on the government to pay all the costs. The issue was not about the performance of the government. The report put in question why there had been no consideration of the scientific evidence. It was sad to note that the judgment, without being clear, placed the responsibility on the WWF to decide what the total allowable catch was at a time when the Department was trying to transform the industry. The TAC had been increased, giving more freedom to those who poached, as there was no other activity in those areas. The Department was not at liberty to debate the pro’s and cons of the case, as it was still pending.   

The storage of abalone had been changed. Currently, the Department was a not at liberty to advise where the new storage was going to be, but no person would be allowed to be there without being vetted.

The Chairperson asked the Minister to clarify on issue of management assessment, and why contracts had not been assessed.

The Minister said he had met with the DG two weeks ago, and they were dealing with what was causing instability in the system. He was doing personal research in the Department, and had discovered that they were over 1 000 employees being paid salaries above their positions due to manipulation of the performance management system. At the next Committee meeting, the Department would be able to give a more precise answer as he conducted further research and followed up.

Mr S Ntombela, DDG: Corporate Services, DAFF, agreed the slide on employment equity needed improvement because of the print quality of making it difficult to differentiate different segments of the equity profile. He spelt out the percentages for those who had not been able to make them out earlier,

On the issue of disability, the target was 2%, and although it was below the target, the Department was taking initiative in partnering with organisations or institutions dealing people with disabilities.

The Department Public Service and Administration (DPSA) standards for the working age state that within the age group of 55-59 years, it was permissible to take early retirement, but taking retirement at this time comes with penalties. At age 60-64, individuals may retire if they want to. At age 65, it was compulsory to retire. As a Department they were in the process of trying to appeal and to make a case to the National Treasury to encourage those aged 60-65 to take early retirement. There were rumours last year about providing incentives for early retirement, so people were waiting for that incentive before they made that decision.

Regarding the high personnel budget and staff shortages, the Minister of Finance had stated the personnel budget was high, and it was currently at about 35%. National Treasury had, however, imposed ceilings on the budgets for each department, making it difficult to carry out some operations. In addition, there had been budget cuts on the compensation of employees to manage the high personnel budget.

In response to the question on validation, as asked by the Chairperson, regarding whether there was a framework, the Department did have a framework and going forward, the provinces would have to register the profiles of the farmers beforehand. The other issue in terms of validation -- ID numbers – it had been discovered that some were duplicates, while others belonged to deceased people. The Department had since then entered into an agreement with the Department of Public Works (DPW), and they were assisting the DAFF with a system of validation.

Minister Zokwana responded as to the question why the Department had not been able to achieve 875 compliances on inspections, saying he had been informed that the inspections had been done but the information had not been put into the knowledge bank. He was hoping that the team would handle the issue. The Department would check if indeed the reason was that the inspections had not been conducted or the work had been done but the information not recorded. It was important to note that the fisheries sector was very risky and was unlike other entities, and scientific methods were used to quantify the number of available fish and other factors, so this needed to be done according to research standards.

A report had been presented to the Cabinet committee on the status of food security and malnutrition. The committee had shown appreciation for the work done, but at the same time had acknowledged that the Department still needed to do more work, as well as other departments such as the Department of Social Development and Health. The report was available to the Committee.

Mr Ntombela added that two approaches were being adopted by the Department ensure the issue of food security was achieved. The first was to make sure there was a programme for small holder farmers/fisheries, and that food production was increased. The second was to ensure that every household had enough food.

Mr Kruger said on his question on cooperatives had not been responded to well. He wanted to know why the Department was not talking or liaising with the Department of Small Business Development when the government allocated so much funding to that department.

Mr Maloyi asked why they exceeded the budget on trade promotion, and what the implications were going forward.

Mr Filtane sought further clarification on whether the Department had enough personnel for inspections. Regarding the staff profile of those aged 60-64, he asked whether at 6% the Department was complying with the standards set by the DPSA.

The Chairperson asked why the Department did not go to the Department of Home Affairs for assistance on IDs, instead of using the DPW. She also sought clarity with regards to the status of the census.

The Minister, in response to the status of the census, said that there was supposed to be a launch. On the day that they were supposed to publicly announce the programme in conjunction with Stats SA, no proper work had been done. He assured the Committee that the DAFF would present a thorough report that the proper work had been done at another meeting.

The Chairperson emphasises the need for the report at the next meeting, and said she expected changes and better responses from the Department. If money was being spent to hire a consultant, the Committee would want to know if there had been improvements in the Department.

Minister Zokwana clarified that the DAFF did actually work with the DSBD and had a good working relationship, even though this had not been emphasised in the presentation. Whenever the Department had projects, the DSBD was involved.

In response to Mr Maloyi, he said the government undergoes an APP process in May-June. The process starts with environmental scans being conducted, and the Department meets with different stakeholders from the industry. Final targets in the APP come from the management function, in consultation with the planning function, during which they establish different targets for the quarters. However, issues or problems arise with some information requiring validation when there are insufficient details, such as information missing on farmer IDs.

Regarding ID validations, the Department of Home Affairs had initially been contacted, but Public Works had been the one which was more readily available to enter into an agreement with the DAFF. It was also noted that the system used by Public Works was no different to that of Home Affairs.

Mr Hlatshwayo said the reason why programme three (food security and agrarian reform) was under-spending at 13% was that the Department had entered into an agreement late. The project was moved to the second quarter, and was now at 48%.

On the issue of trade promotion, in the first quarter the Department was at 35%, but including the second quarter it was now at 51.5%. This had been due to several payments were made to the National Agricultural and Marketing Council, so the Department was almost within the 50% target range.

Mr Maloyi asked why the administration expenditure had exceeded 35% in quarter one.

Mr Hlatshwayo assured the Committee that they monitored the expenditure on a month to month basis, and going forward the would not overspend.

Dr Moephuli responded on issues relating to inspection, and informed the Committee about two types of inspections. The first type of inspection was the one that was done at the market place, where they assured the quality of the product being received. The second type was the responsibility of other departments. They were in discussions with regard to any issues of inspection that influenced the other departments which needed to be quickly identified. There was an agreement to have a discussion on how to ensure product control on inspection.

Mr Ntombela responded that that there was no set percentage for those aged 60-64 as per the regulations or the law. However, the employee profile was supposed to follow a normal distribution curve. The Department had discovered that it had an ageing workforce which they had to manage.

Mr Hlatshwayo, in addition to the Minister’s response on the census, indicated that an agreement had been signed in April, and Stats SA was currently working on it. They had already had a round table with various stakeholders to explain through the work and to take questions from the public. The other part of the focus was on the national registry of farmers, which was led by the DAFF.

There was progress so far on the food security work which would start in 2019-2021. The Department had set up the system, frameworks and institutional mechanisms. A more detailed report could not be provided at the moment, and would be provided in the future

Mr Maloyi suggested that the targets of the Department should be realistic and achievable.

The Chairperson urged the Department to work with the provinces. If problems with the provinces persisted in terms of submitting reports, the DAFF must inform the province that they had been invited to come and give account during Portfolio Committee meetings. In the event that they refused, they would be subpoenaed.

The meeting was adjourned.