International Relations and Cooperation Budget: Committee Report; with Deputy Minister

Meeting report

Briefing on the Report on the Budget Vote

Observations and Concerns

Ms Dineo Mosala, Content Advisor, said that the Committee observed that the department, on its first meeting with the Committee, must make a detailed introduction on its work, its audit baseline and give Committee members a holistic perspective into the unique mandate of the department. It should endeavour to achieve its set annual objectives within the tight allocated budget. The department must provide the Committee with more details on how it plans to navigate without compromising on the deliverables of South Africa’s Foreign Policy. There is a need for future regular political engagements and discussions between the Minister and the Committee on various international affair issues. This will enable the Committee to understand the politics behind certain positions that South Africa has to take in multilateral forums.

The department has conducted a feasibility study on the viability of developing an acquisition and disposal strategy. This strategy is aimed at promoting a shift towards property ownership over rental. The Committee sought details on the result of such a study and progress related to its initial application in the mission, in New York. It was noted that South Africa (SA) is serving a third term as a non-permanent member of the United Nations Security Council (UNSC) for 2019-2020. There is a need for the department to brief the Committee on how SA will utilise its seat in the UNSC to promote South Africa’s foreign policy.

The Cuban government has been diligently repaying the loan ahead of the stipulated time. Cuba was commended for having paid back a large percentage of its current loan with the SA government. It is also noted that the African Renaissance Fund (ARF) is looking at issuing investment loans in the future, such as the one South Africa has with Cuba. A detailed report is requested on the projects receiving funding from the ARF, their status, project oversight reports for active projects and completion reports where projects have been closed. The reports would assist the Committee to draw up its own oversight strategy on the entity. The reports of the Auditor-General and prescripts of the Public Financial Management Act (PFMA) were ignored by the department. The department was urged to comply with legislation.

It was made clear that more information was needed on the circumstances rendering irregular and also fruitless expenditure in the operations of the department. The budgets are not correlating. South Africa has a basket of allocated quotas in strategic international organisations that it is party to. Tthe department was also requested to submit a detailed report on the processes about the provision of a permanent headquarters for the Pan African Parliament (PAP). The Committee remarked that its mandate translates to overseeing and ensuring accountability in the information and implementation of South Africa’s foreign policy. The Committee also noted that the mandate of the department and its entities are largely executed abroad by the department and its SA Diplomatic Missions. 

Recommendations

Ms Mosala said the Committee recommended that the department prioritise its work in order to find resources for financing activities to be borne from South Africa’s international obligations as the chair of several the multilateral organisations in 2019/20 financial year. There should be finalisation of the processes and inter-departmental negotiations towards the operationalisation of the South African Development and Partnership Agency (SADPA). The department must concretise the implementation of the pilot project to acquire property abroad for the utilisation of missions abroad via alternative funding in order to curb costs of leasing properties abroad. A strategy to attract South Africans to fill quotas allocated in international organisations to which South Africa is a member should be finalised. Pending legal cases, especially the matter concerning the Chief Financial Officer should be finalised.

The Committee also made recommendations to the National Assembly. The Parliamentary Oversight Model should allow the Committee to have more regular oversight visits to South African Missions abroad; to conduct oversight visits over international organisations of which SA is a member state; and have regular visits to project areas of the ARF. These visits will allow the Committee to have a holistic approach on the performance of missions abroad.

Discussion

Ms T Msane (EFF) said the report should recommend that other departments must report to the Department of International Relations and Cooperation when they go abroad. The department also raised this as a concerning matter. The department said that it has found it difficult with training employees who are deployed to international organisations. The Committee was promised that it would receive a report on the employment of officials to the ‘back-offices’ and status of the asset register.

Mr B Nkosi (ANC) said 13.2 should include compliance, that the department must implement a consequence management mechanism.

In 13.18 - 13.20, Mr Nkosi suggested that “should” must be replaced with “must”, and recommendations to the National Assembly should be written in bullet point format.

Rev K Meshoe (ACDP) said that the report should reflect that the White Paper has been approved by Cabinet. He asked why it had taken the department this long to develop a strategy to fill quotas allocated in international organisations.

Mr T Mpanza (ANC) said he is happy that the report included its recommendations to the National Assembly as well. He asked that the Committee adopts the report as it is.

Mr M Chetty (DA) said that R300 million has been adjusted in the International Transfers Programme. The department indicated that it had budgeted for R855 million for the International Transfers Programme, yet the new budget allocation indicates that the amount is R1.1 billion. There was a concern raised around the Ministers establishment of the policy review panel. He asked for clarity on both of these matters.

Mr W Faber (DA) said that the department would save costs if it allocated one building for the embassies, instead of spending millions of Rands on leasing buildings.

Responses

Ms Mosala said that each member state to international institutions is allocated with different positions to fill within the institution. The department employs the officials themselves, but it has indicated that South Africans are not interested in working in these institutions because the benefits are not attractive.

Ms Mosala said that the first budget that was submitted by the department was the amounts without the National Treasury budget adjustments.

Mr Chetty said the R300 million adjustment must be accounted for.

Ms Mosala responded that the figures in the report were taken from the department’s Annual Performance Plan (APP).

Mr Alvin Botes, Deputy Minister: Department of International Relations and Cooperation (DIRCO) said that the budget changes to the APP have to be accounted for and the department is obligated to inform the Committee why there has been adjustments.

The Deputy Minister said that he will consult with the department and give the Committee feedback during the next sitting.

The Chairperson said the Committee cannot adopt the report while it has discrepancies. The department must provide the Committee with an explanation or reasons for the changes before the end of the day.

Mr Mpanza wanted clarity on whether the Committee was going to adopt the report without having the correct budget figures.

Mr Kgabo Mahoai, Director-General (DG) arrived late.

The Chairperson said that the Committee cannot adopt the report. Also, it cannot wait for a week to adopt the report because of other commitments. The correct budget amounts will be sent to the Committee, and members will be given an opportunity to respond via email.

The Chairperson asked the DG why he did not attend the meeting, because the report being discussed deals with matters of concern to the department.

Mr Mahoai said that he thought the meeting was closed for Committee members only.

Mr Mpanza said even if the meeting was closed to Committee members only, the department should attend the meeting.

Dr C Mulder (FF+) asked if the DG is automatically invited to all meetings or does the department only attend the meetings on invitation.

Mr Chetty told the DG that there is a budget adjustment of R300 million under the International Transfers Programme. The Administration Programme’s budget also changed from R1.7 billion to R1.4 billion. The budget for the International Relations Programme was also adjusted from R3.3 billion to R3 billion. The department has not given the Committee any explanation for these changes.

Mr Mahoai said that the changes may have been due to National Treasury’s final budget allocations. He requested for an adjournment for five minutes so he could liaise with the CFO.

The Committee adjourned for five minutes.

Mr Mahoai said that the department did not take National Treasury’s final budget allocation when the APP was submitted. The indicative baseline has stayed the same as recorded in the APP. 

Mr Nkosi suggested that the Committee go through the APP and the Committee’s report to compare, and for the DG to confirm which budget amounts are correct.

The Chairperson said that the CFO is the only person who can confirm which budget amounts are the correct budget allocations, and the CFO is not in attendance.

Mr Chetty said that the shifting of large amounts of money without any explanation is unacceptable.

Rev Meshoe said that the DG will not be able to give the Committee the correct budget allocations without the APP documents or the attendance of the CFO.

Mr Mpanza asked if the budget adjustments and allocations surpasses the department’s total budget for the 2019/20 financial year.

Dr Mulder said page 20 of the report reflects the same budget allocations as that in the APP. The budget baselines have stayed the same as well. The only difference is that the new figures reflect the budget adjustments made by Treasury, which is not something abnormal.

Ms B Swarts (ANC) asked where Ms Mosala got the budget amounts.

The Chairperson said that there is a R300 million variance between the APP and the Committee’s report. The DG must get the right figures so that the Committee can amend its report.

Mr Chetty said that the Committee has already established that the baseline has stayed the same, but what they fail to understand is the budget variance of R300 million. He asked how this amount was allocated and where if the adjustments were done.

The Chairperson said that the DG is unable to get hold of the CFO. The Committee will use the APP submitted to Parliament, which is inclusive of the variance amount of R300 million for its report.

The Chairperson suggested that the final budget allocations should be sent to the Committee for further discussion between the Committee and the department.

Ms Swarts said she supports the Chairperson’s recommendation.

Mr D Moela (ANC) also agreed with the Chairperson. He said that these discrepancies show that the department is facing major challenges.

Mr Chetty said that the Democratic Alliance (DA) will reserve their right support Budget Vote six.

Adoption of the Report

Ms Swart moved for the adoption of the report with amendments.

Mr Moela seconded the adoption with amendments.

The meeting was adjourned.