The Portfolio Committee on Basic Education received presentations from four key stakeholders namely the: Financial and Fiscal Commission (FFC); Office of the Auditor General of South Africa AGSA); Department of Basic Education’s Internal Audit Committee and the Department of Basic Education on the latter’s audit outcomes and performance for 2018/19.
The FFC’s presentation focused on the Department’s management of grants and school infrastructure, revealed that several schools in Eastern Cape, Mpumalanga, Limpopo and Kwa Zulu Natal still use latrine pits for toilets.
The Accelerated Schools Infrastructure Delivery Initiative (ASIDI), introduced in 2011/12 and funded by the Schools Infrastructure Backlog Grant to eliminate backlogs in education infrastructure has only met 43.9% of its targets in terms of addressing inappropriate school structures, 40.6% for electricity and 84.2% for water facilities. Despite the R15.5 billion allocated to ASIDI its performance is worryingly low. One of the FFC’s concerns with indirect grants, like ASIDI, is that it weakens accountability and requires very strong oversight because there are many implementing agents involved in the process.
The FFC also assessed the Non-Infrastructure Conditional Grants which includes the: National Schools Nutrition Programme; HIV/AIDS Life Skills Education Grant; Mathematics, Science and Technology Grant; as well the grant for Learners with Severe to Profound Intellectual Disabilities.
It was also revealed that several provinces are consistently funding learners below the threshold. The Portfolio Committee was therefore advised to inquire whether provincial departments were optimally prioritising their budgets to ensure that funding reaches their learners.
Committee members questioned whether the Department was receiving value for the money it spent, particularly in relation to ASIDI. Members also questioned the need for so many implementing agents in ASIDI because it creates accountability problems. These accountability problems arise because the Department is responsible for planning and budgeting while the implementing agents are responsible for rolling out the projects on the ground. Members also questioned how technical persons such as quantity surveyors appointed to oversee ASIDI projects can do so when they are all based in the same area.
The AGSA highlighted that the outcomes of the Department, Umalusi and SACE for the last two years have been stagnant mainly due to material misstatements in their financial statements.
Unlike Umalusi and SACE that received unqualified audits, the Department received a qualified opinion. This is because Umalusi and SACE were able to correct misstatements identified during the audit whilst the Department, unfortunately, had control deficiencies regarding the management of the ASIDI programme.
Within the period of two years, fruitless and wasteful expenditures increased from R82 million to R97 million for the Department. R10 million of the wasted expenditure is linked to the Karigudi Project that has been under investigation for the past two years. An analysis was conducted to determine how much of the wasteful expenditure emanating from the prior year had been investigated in the current year revealed that 38% of wasteful expenditure was not investigated in the current year. Over the past two years, for all three entities, wasteful expenditure increased from R165 million to R210 million and most of this wasteful expenditure is a result of contravention of supply chain legislation.
Irregular expenditure increased from R33 million to R504 million- most of which relate to school infrastructure projects. Several of these schools are under investigation by the Special Investigating Unit.
Committee members were greatly concerned about the effects of ASIDI on the Department’s auditing outcomes and questioned whether AGSA could intervene earlier to assist with ASIDI related issues.
The presentation by the Department’s Internal Audit Committee focused on performance of the Department’s work and areas for improvement confirmed that the Department continues to experience oversight problems. The Deputy Director Generals and Directors failed to exercise effective oversight in their areas.
ASIDI challenges relate to poor capacity to monitor projects, finance and supply management. In particular, there is a lack of coordination between finance and ASIDI. Project managers are not performing, and the information needed to prepare annual financial statements are provided too late because of poor consequence management.
ASIDI is the key issue affecting the Department’s audits because it is fraught with material misstatements, irregular expenditure, and fruitless and wasteful expenditure. It has caused the Department’s assets and commitments to be misquoted. Incomplete and irregular expenditure resulting in the Department’s qualified audit with findings was also caused by ASIDI.
It was recommended that the Department adopts an electronic system, to improve control and strengthen quality assurance over performance information. He also noted that it was recommended that management strengthens quality assurance of
The Internal Audit Committee received a management action plan from the Department to address the AG’s finding but was unhappy with the plan. There has been a subsequent a workshop to discuss the audit and identify the causes.
Committee members noted that the Department has an issue with consequence management and queried the Departments plans to address ASIDI issues. Members also questioned the Internal Audit Committees effectiveness in assisting the Department to put contingency measures in place.
The presentation by the Department of Basic Education focused on its performance. In terms of the Department’s 2024 Action Plan, numerous achievements were attained during 2017/18 and 2018/19. These include, amongst others, an increase in the number of learners who wrote the National Senior Certificate, an increase in the overall pass rate and an increase in the number of students achieving a bachelor level pass for matric. The Department attained a 97% workbook delivery rate.
The presentation focused on the five key programmes namely: Administration; Curriculum Policy, Support and Monitoring; Teachers, Education Human Resources and Institutional Development; Planning, Information and Assessment; and Educational Enrichment Services
In Programme One (Administration), 98 of the 100 posts in corporate services were filled. Within 90 days two disciplinary hearings were held and officials were found guilty and subsequently suspended.
Some achievements in Programme Two (Curriculum Policy, Support and Monitoring) include the provision of e-Library solutions and ICT Professional Development and the implementation of the National Curriculum Statement (NCS) in 190 schools for Grade R to six learners with severe intellectual disabilities was a significant achievement.
Unfortunately, not all targets were met for Programme Three (Teachers, Education, Human Resources and Institutional Development) as there was an issue with sourcing teachers. Programme Four (Planning, Information and Assessment) performed well apart from incidents where contractors were liquidated and could not meet their deadlines.
All targets for Programme Five (Educational Enrichment Services) were met. Some noteworthy activities included Mandela Centenary Commemoration and the Department’s collaboration with the National Heritage Council to host the National Heritage Education Schools Outreach Programme
The Minister and Deputy Minister answered questions and concerns relating to ASIDI. Members also questioned the need for a new programme (the grade nine exit certificates) given that are already ways to improve access to Matric such as the reading programme.
The Chairperson welcomed all members, the Director General, the Internal Audit Committee, the Auditor General, and the Finance and Fiscal Committee, before introducing Ms Portia Mbude Mutshekwana as the Portfolio Committee’s new content advisor.
After completing a short prayer and obtaining Committee Members’ acceptance of the agenda, the Chairperson requested the Financial and Fiscal Commission (FFC) to proceed with their presentation.
Briefing by the Financial and Fiscal Commission (FFC)
Prof Daniel Plaatjies, Chairperson, FFC, commenced with an overview of the FFC’s responsibilities which includes, amongst others, advising Parliamentary Committees on fiscal policy issues, monitoring the Department’s socioeconomic an fiscal policies, and providing recommendations to the Department on the division of revenue before the Department submits its budget to the Minister of Finance. In addition to this, the FFC also monitors the Department’s input issues such as learner materials and infrastructure.
Of concern to Mr Plaatjies was the disparity in the access and quality of education received by learners. There is a distinct difference between children from middleclass households and poor children. In richer provinces such as the Western Cape and Gauteng, learners have better access to learner-support materials.
He urged the Portfolio Committee to invite the person(s) within the Treasury responsible for allocating and spending relevant funds and to question whether Department costed and priced its policies, initiatives and programmes if they (the Department) reports that it is underfunded.
Ms Sasha Peters, Researcher, FFC, proceeded to discuss the Non-Infrastructure Conditional Grants and equity in education, particularly equity in spending and infrastructure.
The Education Infrastructure Grant and the School Infrastructure Backlogs Grant which funds the Accelerated Schools Infrastructure Delivery Initiative (ASIDI), are the Department’s key infrastructure grants.
In terms of reaching infrastructure targets, the 2018 National Education Infrastructure Management Systems (NEIMS) Report revealed that Eastern Cape still had schools with no access to sanitation. Several schools in the Eastern Cape, Kwa-Zulu Natal, Limpopo and Mpumalanga are still using pit-latrines for toilets. The Department has set 2020 as the target date by which the conditions must be remedied. Over 90% of the schools in Eastern Cape and 80% in Mpumalanga are without libraries and the target date for this to be addressed is set at 2023. This information is a clear indication of how much more the Department must do to ensure quality education for all learners in the countries.
In March 2018 Infrastructure related regulations, such as the Guidelines for General Upkeep and Maintenance of Education Facilities, were put into effect. These guidelines are aimed at creating uniformity in the maintenance processes across the sector and prolonging the life of education facilities.
The Accelerated Schools Infrastructure Delivery Initiative (ASIDI) was introduced in 2011/12 to eliminate backlogs in education infrastructure, and to upgrade schools to meet the prescribed standards set out in the Norms and Standards for School Infrastructure. ASIDI is funded by the Schools Infrastructure Backlog Grant, which is a conditional grant. The grant was scheduled to end in 2017/18 as ASIDI was a high impact but temporary intervention. At the end of 2017/18, ASIDI was meant to merge with the Education Infrastructure Grant but due to incomplete projects and upcoming projects ASIDI was extended to run over the 2018 and 2019 MTEF periods.
Since its inception, R15.5 billion has been allocated to the ASIDI. Over the course of eight years, between 2011 and 2019, ASIDI has only met 43.9% of its targets in terms of addressing inappropriate school structures, 40.6% for electricity and 84.2% for water facilities. In most areas, ASIDI’s performance is worryingly low. However, in terms of sanitation in schools, ASIDI is overperforming and its over-performance is driven by Mpumalanga and Limpopo where service delivery is well over the baseline.
Unfortunately, service delivery is significantly slower in less resourced provinces which continues to disadvantage learners from these poorly resourced provinces. Ms Peters requested that the Committee consider whether the Department is truly getting value for its money through ASIDI projects.
One of the FFC’s concerns with indirect grants, like ASIDI, is that it weakens accountability and requires very strong oversight because there are many implementing agents involved in the process. Other ASIDI related challenges include poor communication, slow procurement and implementation processes, inadequate management capacity and inadequate disincentives to prompt implementing agents to comply with time and financial limits.
The Education Infrastructure Grant is aimed at accelerating construction, maintenance, upgrading existing infrastructure in education and ensuring that the minimum norms and standards for schools are met. The grant is a Schedule 4 conditional grant to provinces which means that provinces must supplement provincial allocations of the grant. Due to fiscal consolidation, allocations to the grant have been reduced. Provinces have also reduced their contributions to the grant due to constrained budgets.
Since 2016/17 allocations to the grant have either been reduced or experienced very marginal growth. However, spending for the grant has been good in relation to the general spending performance of infrastructure conditional grants.
Grant spending must be considered along with service delivery output. Due to the lack of data, it was only possible to analyse service delivery with the grant’s spending for 2016/17. During this year, the data indicated a mismatch between the spending of the budget and the service delivery. Should this trend continue the Portfolio Committee would have to determine the cause and what the applicable remedies should be. Some reasons for the mismatch that have been cited include: late submission of invoices by service providers, resulting in significant backlog in the invoice processing, delayed delivery due to sub-standard work by contractors, and the delay in the issuing of practical completion certificates which hinders handing over completed projects.
Regarding the existing infrastructure delivery mode, the FFC noted that in the current model for provincial infrastructure projects, planning, budgeting and implementation are all separated functions between the sector department and implementing agents. The sector department is responsible for planning and budgeting while the implementing agents are responsible for rolling out the projects on the ground. This separation of responsibilities causes distance between those accountable for planning and budgeting and those rolling out the projects. Subsequently, implementing agents do not have incentives to properly manage projects and this causes overbudgeting and infrastructure to exceed the time limits.
There is a need for stronger oversight when it comes to infrastructure projects. When there is little oversight, opportunities for fiscal misappropriation often arise. The loopholes and gaps in oversight must be strengthened. Whilst noting the intention to merge the infrastructure grants, Ms Peters cautioned that this would not solve the inefficiencies in the performances of the grants.
The FFC also assessed the Non-Infrastructure Conditional Grants which includes the: National Schools Nutrition Programme; HIV/AIDS Life Skills Education Grant; Mathematics, Science and Technology Grant; as well the grant for Learners with Severe to Profound Intellectual Disabilities. Many of the challenges facing these grants relate to way the delivery data was arranged for these grants. This made it difficult to match the different targets to their years and to determine what the performance for each target was.
The National School Nutrition Programme Grant is aimed at providing free daily meals to learners in poor schools. Overall, the funds for this grant have been well-spent. The average of the funds spent exceeds 95%. However, some of the key challenges for this grant include: the lack of up-to-date and accurate stock registers and poor procurement practices evident in schools failing to follow competitive bidding processes when looking for potential suppliers.
In terms of the HIV/AIDS Life Skill Grant, during 2011 and 2018/19 there have been challenges in spending of the budget in Limpopo. The FFC believes this to be an issue of oversight and when such a trend of poor performance arises, then the national sector department ought to assist and improve the performance.
The Mathematics, Science and Technology Grant was marked by severe underspending in 2017/18. Although this has improved, spending performance in Free State and Limpopo is consistently poor due to poor procurement processes in provincial education departments. Although there has been a major focus on the fourth industrial revolution and the skills that need to be taught at the basic education level, one of the challenges noted for the grant, which is around R300 million, is the lack of strategies to ensure sustainability of ICT labs and workshop equipment beyond the conditional grant.
The grant for Learners with Severe to Profound Intellectual Disabilities has only been in operation for 2 years and in 2017/18, only 68% of allocations were spent. There has, however, been improvements in the 2018/19 data. Some of the challenges relating to the grant are general problems which arise with new grants, namely: under-expenditure due to personnel recruitment, and the long waiting periods for placement of learners into special needs schools.
According to a 2017 presentation delivered to the Portfolio Committee of Basic Education, there are over 241 000 learners with special needs enrolled in special and ordinary schools. Approximately 11 500 learners are on waiting lists and Statics SA data suggested that there are over 500 000 learners of school going ages with disabilities that are not attending any educational institution. Although the existence of the grant shows a commitment to special needs education, whether the intervention was proportional to the challenge is questionable. The FFC intends to conduct research on special needs education, focusing on, amongst others, the gaps in resourcing special needs education both from a financial and a non-financial perspective.
In terms of equity in education, the National Norms and Standards for School Funding which has been implemented is key in the Department’s plan to bring about an equitable approach to the School Funding Framework. Several provinces are consistently funding learners below the threshold. It would therefore be advisable for the Portfolio Committee to inquire whether provincial departments were optimally prioritising their budgets to ensure that funding reaches their learners. Combined with the general poor quality of education, learners from lower socioeconomic backgrounds are likely to remain at a disadvantage, highlighting the disjunct between access to education versus quality education for all.
Before concluding, Ms Peters noted the FFC’s recommendations for the performance of infrastructure and non-infrastructure grants and equity in education. In terms of the former, there should be more effective oversight over conditional grants so that remedial action is taken the moment poor performance is identified. It would be useful for the Department to develop clear performance evaluation frameworks for the grants under its control. Well defined performance indicators, based on quality, cost and time factors, can be tracked across project cycle stages for all provinces. Furthermore, more stringent penalties should be implemented for agents who underperform as their poor work incurs costs and overruns causing the Department’s failure to meet its performance targets which in turn affects the latter’s audit outcomes.
In terms of equity in education, the FFC recommended that the Department note and remedy the fact that the policy and funding frameworks attempting to entrench equal treatment of learners, greatly disregards historical disparities and other constraints that disproportionately affect disadvantaged schools. The Department should also investigate persistent underfunding to determine the causes and what remedial actions other provinces have taken to fund learners properly.
Briefing by Office of the Auditor-General of South Africa (AGSA)
Mr Joshua Bangazi, Senior Audit Manager, AGSA, informed the Portfolio Committee that the presentation would focus on the audits conducted on the Department of Education, Umalusi and the South African Council of Educators (SACE)
Mr Bangazi had audit outcomes data from 2014/15 to 2018/19 but mainly focussed on the outcomes of the last two years. The audit outcomes of the Department, Umalusi and SACE, have been stagnant mainly due to material misstatements in their financial statements. Other reasons for the stagnation include: slow or no response to improve key controls and addressing risk areas; and inadequate consequences for official’s poor performance and transgressions.
Unlike Umalusi and SACE who received an unqualified audit, the Department received a qualified opinion. This is because Umalusi and SACE were able to correct misstatements identified during the audit whilst the Department, unfortunately, had control deficiencies regarding the management of the ASIDI programme. AGSA also discovered numerous instances of noncompliance with laws and regulations pertaining to the procurement of goods and services which resulted in several irregular expenditures for the Department.
During 2017/18 and 2018/19, all three entities submitted their financial statements by the legislated dated, but some financial statements contained errors. Since Umalusi and SACE were able to correct the errors in their financial statements after the audit, the quality of the collective financial statements was 67%. Furthermore, over the course of 2017/18 to 2018/19, all three entities had non-compliance findings. The main non-compliance areas for the entities were the quality of financial statements submitted. In addition to this, the Department also had non-compliance in terms of prevention of irregular expenditure, management of procurement and contracts, as well as non-compliance in consequent management.
Across the three pillars of internal control namely: leadership, financial and performance management as well as governance, proper record-keeping was the main concern requiring intervention. All three entities are not keeping proper records to support the figures reported in their financial statements and the underperformance report. AGSA discovered that discipline of daily and monthly control is lacking amongst all three entities. This resulted in the material misstatements. Furthermore, an intervention is needed to review and monitor compliance across the three entities. Whilst Umalusi and SACE fared adequately for risk management, the Department still needs to do a lot to address all the issues raised by AGSA.
The assessment of assurance providers by AGSA was purely based on the internal control measures (above). It assessed senior management, accounting officers, internal audit units and the Audit Committee. Across the three entities, assurance providers are indeed providing assurance given the internal controls previously mentioned.
In terms of the management and delivery of key programmes, AGSA confirmed that 91.8% of the budget allocated to ASIDI was used however when considering the achievement of targets under the ASIDI programme, most of them were not achieved.
Within the period of two years, fruitless and wasteful expenditures increased from R82 million to R97 million for the Department. This expenditure related to costs incurred for school infrastructure that was subsequently discontinued. R10 million of the wasted expenditure is linked to the Karigudi Project that has been under investigation for the past two years. An analysis was conducted to determine how much of the wasteful expenditure emanating from the prior year had been investigated in the current year revealed that 38% of wasteful expenditure was not investigated in the current year. Over the past two years, for all three entities, wasteful expenditure increased from R165 million to R210 million and most of this wasteful expenditure is a result of contravention of supply chain legislation. In totality, only 88% of the expenditure across the entities were investigated.
In terms of irregular expenditure, AGSA found that it increased from R33 million to R504 million- most of which relate to school infrastructure projects. Several of these schools are under investigation by the Special Investigating Unit. Of the irregular expenditures reported from the prior year, only 8% has been investigated.
Within the current financial year, Umalusi was the only entity that did not have any findings in relation to supply chain management. Both SACE and the Department had findings, because AGSA was unable to audit procurement of R149 million, due to missing or incomplete information relating to three awards.
After conducting an analysis of the Department’s efforts in investigating reported allegations of financial misconducts, the findings revealed that there were allegations that were not investigated, investigations that took longer than three months and/or allegations that were not properly investigated.
Overall, for the 2017/18 financial year, there were no clean audits across the entities. There were two entities with findings and zero entities with no findings on compliance with legislation. From 2017/18 to 2018/19 irregular expenditure increased from R165 million R210.7 million
Before concluding, Mr Bangazi noted AGSA’s recommendations to the Department and the Portfolio Committee. AGSA recommended that the Department’s accounting officer and authorities ensure that senior management develops an action plan to address the internal control deficiencies identified by AGSA’s reports as root causes of audit findings. The action plan should focus on the root causes of audit outcomes instead of addressing specific findings as this would prevent new or similar findings in future. The implementation of this plan should be monitored by the relevant accounting officer.
The Department should also ensure that its accounting officers and authorities investigate non-compliance findings to determine whether there are indicators of financial misconduct or misconduct in the supply chain management processes.
The final recommendation to the Department was that controls should be in place to ensure that transactions are processed in an accurate, complete and timely manner, which in turn will reduce the errors and omissions in financial and performance reports.
AGSA recommended that the Portfolio Committee ensures: quarterly reports submitted are verified by internal audit and the Audit Committee; the evaluation of quarterly reports, action plans and measures for consequences; and details on how the Department will resolve issues raised. In addition to this, AGSA recommended that information in audit reports on material irregularities should be used for accountability and oversight purposes. The Portfolio Committee should insist on timeous implementation of recommendations and the use of reports tabled on progress with material irregularities to oversee and influence progress made with the implementation of actions.
Mr Takalani Rambau, Senior Manager, AGSA, proceeded to present on the sector outcomes. AGSA’s audit on sector outcomes were mainly focused on school infrastructure, full-service schools and education information systems.
To analyse the school infrastructure, five schools within each province, either at completion stage or still under construction, funded by ASIDI grants were selected for an analysis. The analysis focussed on key issues such as planning and budgeting for the project, execution of the project, quality of infrastructure and whether money was used for its intended purpose.
The analysis revealed that ASIDI projects did not commence on time in the Western Cape, Gauteng and Mpumalanga. In these instances, only projects in the Western Cape were completed on time.
When considering the execution of school infrastructure project, underfunding and overspending became apparent. There were also findings relating to consequent management in a few provinces. After considering the quality of the infrastructure, it was discovered that ASIDI projects were of a substandard quality in several provinces.
When investigating whether the money was used for its intended purpose, findings revealed that the spending was not aligned with the stages of completion. Budgets were spent but project milestones were not achieved. Fruitless and wasteful expenditure relating to projects was rampant and infrastructure was either not utilised for its intended purpose, under-utilised or not utilised at all.
Full-service schools, previous mainstream schools subsequently designed to cater for special needs students, were also considered. These schools require additional funding to ensure that the infrastructure can accommodate students with special needs. AGSA noted certain deficiencies in these schools. In particular, the provincial education department is not providing adequately guided and capacitated education districts and inclusive education at these schools.
Before concluding, Mr Rambau, confirmed that during the audit of the SA School Administration and Management System (SA-SAMS) it was discovered that there was no formally documented and approved procedure to manage and grant user access to the database. This means that anyone can interfere with the data. It is imperative that steps be taken to limit user access to the system and a backup system should be designed to cater for an unfortunate event where the system malfunctions.
The Chairperson then handed over to Prof van der Nest from the Department’s Internal Audit Committee.
Briefing by the Department’s Internal Audit Committee
Prof Daniel van der Nest, Chairperson, DBE Audit Committee, began by voicing the Audit Committee’s concerns with the issues raised by AGSA and confirmed that they would continue to monitor and address these issues. Nonetheless, there were some improvements. There is an improvement in monitoring performance information and there has been better coordination relating to the verification of reported evidence within the strategic planning branches. The Department is also conducting follow-up audits on ASIDI projects.
Despite these improvements, the Department continues to face several challenges. It continues to experience oversight problems with Deputy Director Generals and Directors who fail to exercise effective oversight in their areas. Several audit findings have also not been effectively addressed by the Department - one of which relates to quality assurance which remains inadequate.
ASIDI challenges relate to poor capacity to monitor projects, finance and supply management. In particular, there is a lack of coordination between finance and ASIDI. Project managers are not performing, and the information needed to prepare annual financial statements are provided too late because of poor consequence management.
ASIDI is the key issue affecting the Department’s audits because the former is fraught with material misstatements, irregular expenditure, and fruitless and wasteful expenditure. The Department has now implemented an irregular expenditure register to monitor and address irregular expenditures.
ASIDI caused the Department’s assets and commitments to be misquoted. Incomplete and irregular expenditure resulting in the Department’s qualified audit with findings was also caused by ASIDI. Nonetheless, these issues must be addressed immediately to obtain an unqualified audit in the future. The Department would need to improve the monitoring of implementing agents which they can do given that the Department recently employed specialist staff such as quantity surveyors and engineers to strengthen internal capacity.
The Internal Audit Committee recommended that more effort be directed towards internal audits. The Department has however requested, from the auditing team, full sets of half-year financial statements with accurate records to establish whether the Department improved in the problem areas. However, because of the many implementing agents in the ASIDI programme, submission of information tends to take time. It was also recommended that the Department adopt an electronic system, to improve control and strengthen quality assurance over performance information.
The Internal Audit Committee received a management action plan from the Department to address the AG’s finding but they were unhappy with the action plan. There has been a subsequent a workshop for the AG and management to discuss the audit and identify the root causes. Another meeting will be arranged in November to establish whether the Internal Audit Committee is satisfied with the proposed action plan.
Before concluding, Prof van der Nest, confirmed that the Internal Audit Committee will continue to address all matters within its mandate, paying particular attention to the high risk and high impact areas and monitor the implementation of consequence management so that the Department can obtain a clean audit.
Ms N Tarabella-Marchesi (DA) questioned whether the budget allocation of each learner was revised to take inflation into account and if there are alternative funding mechanisms for learners that are underfunded.
In response, Ms Peters confirmed that inflation was not taken into consideration. The funding of learners is based on the size of the school, leaners’ age and the population of the school but ultimately the provinces choose to allocate the money based on their discretion. This could be an issue of prioritisation within the provinces, but a possible suggestion would be for the Department and the Treasury to investigate the cause of the underfunding.
In addition to this, Mr Rakabe, Programme Manager, FFC, explained that the equitable share allocated to provinces is updated annually to consider learner enrolment and a baseline is added to the calculations which almost averages inflation.
Ms Tarabella-Marchesi asked when AGSA commences with their auditing. The ASIDI issue is repeatedly raised despite recommendations by AGSA. She hoped that AGSA could audit and intervene earlier to assist with the ASIDI issue.
Mr Bangazi replied that AGSA commences their audit process in October. During this time accounting officers and auditors discuss the risk assessment strategies and focus areas for the upcoming year. However, auditors can intervene much earlier because they often implement interim audits to detect early warning signs for the Department to rectify before the actual audit. In addition to this, auditors implement a ‘Status of Record Review Initiative’ to assess internal control processes, flagging issues that need to be addressed.
Unfortunately, despite AGSA issuing recommendations, it was not implemented entirely, explained Mr Bangazi. The slow response by management to address issues picked up in earlier years is one of the key reasons for its latest audit outcome.
Ms Tarabella-Marchesi commented that the Department’s presentation only referenced one incident in which contractors performed such inadequate work that another contractor was called upon to rectify it and wanted to know whether this was the only ASIDI project that encountered such a problem and how much money the Department has lost due to non-completion of projects.
Mr Bangazi confirmed that this was the only case from the projects selected for analysis. The Department selected several projects to determine non-compliance, material irregularities, and financial loss. From the pool of projects selected only this one was discovered. This does not mean that it was the only project that resulted in financial loss, but it was the only project from the selected pool of projects that resulted in a financial loss. Furthermore, AGSA is unable to quantify the total amount lost due to non-compliance.
Ms Tarabella-Marchesi reminded Prof van der Nest that the Internal Audit Committee has a significant role in guaranteeing that ASIDI projects are successful by ensuring that implementing agents do their work and are not given work again if they (implementing agents) fail to perform. She then proceeded to enquire about the Internal Audit Committee’s plan to address the ASIDI related issues.
Prof van der Nest explained that the Internal Audit Committee is an externally appointed oversight committee which meets four times a year. The Internal Audit Committee relies on the assurance of internal audits regarding certain risk areas. Based on evident risks the Internal Audit Committee approved a plan for internal audits to be conducted. In the previous financial year 14 audits were conducted and several findings were revealed which promoted the Committee to make recommendations to management. Other than that, there is nothing more that the Committee can do as its role is to monitor.
Ms Tarabella-Marchesi asked whether the FFC was willing to concede that the provinces performed better the ASIDI.
Mr Rakabe responded that the provinces improving their infrastructure should not lead to an issue of comparison. When the FFC considers provinces, it does not only look at the provinces in terms of the responsibility to deliver education infrastructure. The provinces have an infrastructure delivery system and it has been shown that provinces are better at delivering infrastructure projects than the National Department. ASIDI is a very different case. Usually there is a planning problem and schools are built in areas where learner numbers are declining, and the school then becomes underutilised.
Mr T Malatji (ANC) noted that the main issue facing the Department is consequence management. The Department fast tracks black companies but they do not always deliver on projects. Department officials who engage in this should face the consequences because state resources are wasted, and projects are being delayed.
Mr E Siwela (ANC) asked whether his view that ASIDI is the Department greatest cause of problems is correct and wanted to know what the Department has been doing to ensure that issues of funding around infrastructure are addressed.
He also sought clarity on who should conduct investigations on learners being underfunded in various provinces and questioned the steps being taken by the Department to ensure that it receives the desired audit outcomes.
Ms N Adoons (ANC) thanked the teams for their presentations before asking whether the recommendations made by the AG were implemented in prior years to prevent the reoccurrence of some of the findings.
She asked the Department to highlight its improvements in the ASIDI programme and questioned the effectiveness of the Internal Audit Committee in assisting the Department to put contingency measures in place once the AG makes its findings.
Prof van der Nest explained that the Internal Audit Committee has been operational for two years. It found out about the ASIDI issues and subsequently conducted intensive meetings with management. However, unfortunately, these issues were not resolved. There was a change in management, but the findings remained. The Internal Audit Committee insisted that management provide a plan to address the root causes of the findings within the programme. Whilst the Internal Audit Committee received the plan, AGSA did not accept it because it was not a plan that would result in an audit with no findings.
A legislature has been included for irregular expenditure. It requires each case of irregular expenditure to be accounted for and investigated. The Internal Audit Committee receives the financial statements after which they have discussions with management. The difficulty for audit committees is that even though they receive assurance from management, they never really know whether management will deliver on its promises. Furthermore, specialists were also hired to address the issue of a lack of oversight capacity which was noted as one of the root causes of the audit findings.
Ms N Shabalala (ANC) asked the FFC whether the Department was receiving value for the money it spent and if not, what should the Portfolio Committee do to monitor and ensure that the Department receives value for money. She asked the Department’s Director General for more information on the AGSA recommendations and when the Department would be implementing the recommendations.
Ms Peters explained that value for money should mean achieving the set targets in a manner that minimizes wasteful expenditure. Considering that R15.5 billion has been allocated to ASIDI each year since 2012, there is room to improve spending.
Ms Shabalala noted that the Department would not be able to exercise accountability because although the Department has planned the programme it is up to other actors to implement it. Nonetheless, this problem needs to be addressed otherwise the Department will always encounter the same audit problems.
Mr P Moroatshehla (ANC) agreed with Ms Shabalala that accountability will become an issue when the implementing agents are different from those who planned the programme. He also questioned whether the FFC can address the terrible backlog since 1994 to provide access to quality education.
Mr Rakabe explained that the Department is moving in the right direction in relation to school infrastructure. The only issue is that the Department is currently dealing with backlogs and the ASIDI structure which was meant to be a temporary programme also faces many challenges. If these challenges are fixed, then the Department will be able to address all its school infrastructure challenges.
Mr Siwela asked why ASIDI does not use schools that the Department already built because he was always under the impression that ASIDI was improving existing schools in the province.
The Chairperson questioned why there were so many implementing agents within the ASIDI programme and sought clarity on how technical persons, such as quantity surveyors and engineers appointed to oversee ASIDI projects in different locations can do so when they are based in the same location. A possible suggestion would be for these ASIDI technicians to be distributed across the provinces so that they can better monitor projects at provincial level.
Ms Peters conceded that it was time to reconsider the current delivery modality for ASIDI. The Department is incapable of managing a big project like ASIDI and should therefore consider decentralizing the programme.
Briefing by Department of Basic Education
The Chairperson welcomed the arrival of the Minister, Ms Angelina Angie Matsie Motshekga, and Deputy Minister, Dr Mhaule, before handing over to Mr Mathanzima Mweli, the Director General of the Department.
Mr Mweli commenced with the comparing the 2017/18 and 2018/19 financial years and explained that there has been an increase in the number of programmes indicators over the past two years. The programmes were assessed against the indicators for the programmes. Between 2017/18 and 2018/19, the targets for Programme Two (Curriculum Policy, Support and Monitoring) increased from 10 to 11 annual targets. This period marked the Department’s highest performance ever. The Department really improved with regards to meeting its targets as 85% of all targets were achieved in 2018/19.
In terms of the Department’s 2024 Action Plan, numerous achievements were attained during 2017/18 and 2018/19. These include, amongst others, an increase in the number of learners who wrote the National Senior Certificate, an increase in the overall pass rate and an increase in the number of students achieving a bachelor level pass for matric. The Department attained a 97% workbook delivery rate. Overall, the Department maintained an upward trajectory with regards to its performance.
The Director General, Mr Zweli, proceeded to consider the performance five programmes, namely: Administration; Curriculum Policy, Support and Monitoring; Teachers, Education Human Resources and Institutional Development; Planning, Information and Assessment; and Educational Enrichment Services
In Programme One (Administration) 98 of the 100 posts in corporate services were filled, 260 employees attended skills development training and 99.05% of invoices were paid within 30 days. Within 90 days two disciplinary hearings were held and officials were found guilty and subsequently suspended. This, according to Mr Zweli, shows that the Department does have consequence management albeit inadequate according to the Auditor General.
In Programme Two (Curriculum Policy, Support and Monitoring) the Department underperformed in the training of CAPS Technical Subjects. Some achievements in this programme included the provision of e-Library solutions and ICT Professional Development. For the former, 100 schools each school received 20 tablets, a mobile trolley, laptop, and data projector, whilst the latter entailed 1 102 DBE and PED officials being trained on how to use Modular Object-oriented Dynamic Learning (MODDLE) Learning Management Systems in all provinces. Furthermore, the implementation of the National Curriculum Statement (NCS) in 190 schools for Grade R to six learners with Severe Intellectual Disability (SID) was a significant achievement.
Unfortunately for Programme Three (Teachers, Education Human Resources and Institutional Development) not all targets, specifically the sourcing of teachers, were met as a list of teaching bursary holders did not correlate with the data that the National Student Financial Aid Scheme had.
Programme Four (Planning, Information and Assessment), which considers school infrastructure performed well against the relevant performance indicators. However, there was an incident with contractors in the Eastern Cape who experienced cash flow problems and were liquidated which subsequently led to targets not being achieve by the Department. Although the Department works with implementing agents, this does not necessarily mean that accountability will be an issue because accountability ultimately rests on the Department who entered into the agreements with the implementing agents. Targets that were not met in this programme during the 2018/19 period will be carried over to 2019/20.
After meeting with the Eastern Cape Black Contractors Association, Mr Mweli confirmed that the issue raised by contractors was that the Department is clustering too many projects and leaving out small contractors. Given this, the Department will try not to cluster projects but noted that it would not appoint contractors who did not have the capacity for the job.
Furthermore, despite the challenges with ASIDI programme in 2017/18 where the Department could only account for the completion of 29 schools, in 2018/19 there are 200 schools at practical completion.
All targets for Programme Five, Educational Enrichment Services, were achieved. Some of the noteworthy activities within the programme included the Mandela Centenary Commemoration and the Department’s collaboration with the National Heritage Council to host the National Heritage Education Schools Outreach Programme (HESOP) for 43 learners in Free State. The Mandela Centenary Commemoration was hosted on 6 August 2018 in Amathole District at Elliotdale, Eastern Cape where Albertina Sisulu was also celebrated.
Mr Mweli then proceeded to consider the Department’s annual financial statements. The Department’s overall performance stood at 98%. However, it was underperforming in Programme Two: Curriculum Policy, Support and Monitoring, due to workbook related issues. The Department did not appoint LTSM coordinators in all provinces and the Department could not appoint a full complement of therapists for the workbook project.
The Departments audit report by the Auditor General of South Africa returned a qualified audit for Programmes Two and Three. Actions were taken to remedy this. The interim financial audit will be released soon and will evidence the Department’s improvements in the last six months. Before concluding, he noted that ASIDI problems are tenfold, but experts have been appointed in Pretoria to remedy the issues.
Ms M Sukers (ACDP) noted that advocates for the intellectually disabled expressed concerns that the Department is not meeting is constitutional and legislative obligation to ensure that children have access to education. With specific reference to slide 44 of the presentation, she wanted to know how and when the Department plans to ensure that learners at special care centres will access public funded education of an adequate quality.
She enquired about the number of learners with special needs that have been admitted to school for the first time since the Minister’s announcement and sought clarity on the Department’s plan to ensure that the President’s Declaration (that by 2021 no learner with a disability will be excluded from school) will be fulfilled.
She asked when, how and with that funds, the Department plans to implement the court order to provide: education of an adequate quality to learners with intellectual disabilities; funds to special care centres, transport and equipment to special care centres; and the appropriate training and educations for educators.
Minister Motshekga, noted that the Department would soon provide a comprehensive report on the special education programme.
The Director General also commented that the Department’s presentation on learners with special needs will adequately address such questions.
Ms Sukers sought further clarity on what was meant by “support educator training on sexual and reproductive health for learners” on slide 92.
The Director General requested that the Department be allowed to respond to this question at a later stage.
In terms of the National Schools Safety Framework, Ms Sukers wanted to know how accurate the school safety monitoring process is, given that many schools do not report violence at their schools.
Ms Tarabella-Marchesi asked whether the Minister would be speaking about the GEC and if Members could ask questions on it.
In response, the Chairperson explained that this matter (the GEC) would be presented on in the following week.
Ms Tarabella-Marchesi requested that the Minister provide some assurance on the ASIDI programme, particularly, whether steps were being taken to ensure that the programme turns around and becomes a success.
Minister Motshekga explained that ASIDI was initially meant to be a three-year programme implemented through the DBSA, but it had to continue because the Department identified many provinces that had not done a complete audit. The programme then extended even though the Department had not built capacity for the project. The Department received a qualification through ASIDI due to the slip ups between the Department and the DBSA. After the qualification, received via ASIDI, the Department approached the Treasury to build capacity for the project in order to mitigate its shortcomings – hence the specialist that have been hired.
Ms Tarabella-Marchesi also questioned whether it would be better to use a different funding model for school infrastructure since it appears that provinces are able to provide better service delivery that the ASIDI programme.
Ms Tarabella-Marchesi asked the Minister for an update on having a transport grant approved by the National Treasury and whether she (the Minister) believed that the grant would be approved.
Minister Motshekga explained that it was the Treasury’s proposal to create a transport grant that would be managed nationally. The Department would then be able to work with the provinces in the same way it has been doing for the school nutrition programme. This transport project is informed by the fact that learners who should be transported to school are not being transported compared to other provinces where there is an overcapacity for learner support. The Department is trying to change the way in which they fund provinces because the current model is not working.
Ms Tarabella-Marchesi asked whether the learning programme that was introduced in the Eastern Cape last year would be rolled out in other provinces.
She also sought clarity on how the Department plans to roll out grade nine exit certificates. She questioned its relevance given that ECD and reading programmes are aimed at improving the learners’ progress in school.
In response, the Minister remarked that the Committee has not spoken about the architecture for education before explaining that the ECD us a different programme which has nothing to do with the GEC. The GEC is meant to address the issue of standardising assessments in the education system.
Ms Tarabella-Marchesi asked to rephrase her question as she felt she was being misquoted. She questioned the need to add a new programme given that there are already ways to improve access to Matric such as the reading programme and the ECD.
The Director-General explained that the Department was able to get 624 000 learners to grade 12 while the Department of Higher Education has been able to get between 672 000 and 800 000 learners into colleges. Many of these learners go to TVET colleges after grade nine.
Deputy Minister Mhaule added that the ECD migration will still be presented on to the Portfolio Committee and when it is presented on, the presentation will include a budget
Ms Shabalala expressed her satisfaction with the Department for implementing some remedial actions based on the AG’s recommendation but noted that if the Portfolio Committee received the Department’s report before the FFCs presentation, a different picture would have been painted.
Mr Moroatshehla commended the Director General on a well-presented report and the Department’s intervention to address current challenges. He asked whether ASIDI has a standardized framework for school plans and if so, what basic features of the framework are used for schools built by ASIDI across the board.
Deputy Minister Mhaule explained that schools are not the same and their needs differ accordingly. Hence, the Department cannot devise a single standard structure for the school. The Department does, however, look at the basic functionalities of the school which includes classrooms, basic services, fans, water and sanitation etc. Based on the needs of the communities in which schools exists, some functions may be absent. For example, if a community does not have running water then the school will also not have running water, but the Department will try to provide necessary amenities.
Mr Siwela sought clarity on the resolution to do away with IQMS and implement QMS. In particular, he wanted to know the difference between the two.
The Director-General explained that the main difference is that the IQMS did not isolate a learner as proxy for performance of a teacher whereas the QMS does so.
Mr Siwela also asked whether the Department had a good record for recovering wasteful expenditure and sought an explanation for the AG’s finding that the Department has an issue with consequence management.
The Director General responded that the issue of inadequate consequence management was a result of a lack of capacity. However, this does not detract from the fact that the Department has been exceptional at wasteful expenditure recovery.
Mr Siwela asked whether the absence of the person appointed for service delivery at the briefing was an accident on the appointee’s part and if so, how does the Department aim to ensure that this not reoccur in the future.
Ms Adoons noted that the information contained in the report was not new and recommended that the Department include their progress reports when presenting their quarterly reports.
The Director-General, explained that there were new developments highlighted in report such as the specialists that were hired as well as the Department’s approach in consequence management.
The Chairperson confirmed that the Portfolio Committee would support the Department in remedying ASIDI related problems and emphasized the need for consequence management in the Department.
The Chairperson adjourned the meeting.
- Financial and Fiscal Commission input
- Department of Basic Education 2018/19 Annual Report presentation
- Department of Basic Education Audit Committee presentation
- AGSA: 2018/19 BRRR presentation
- Equal Education submission on 2018/19 AR
- Western Cape Forum for lntellectual Disability submission on 2018/19 AR
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