UIF & Compensation Fund 2018/19 Annual Reports; with Minister & Deputy Minister

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Employment and Labour

09 October 2019
Chairperson: Ms M Dunjwa (ANC)
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Meeting Summary

Annual Reports 2018/2019

The Committee was briefed by the Unemployment Insurance Fund (UIF) and the Compensation Fund (CF), two entities of the Department of Employment and Labour, on their quarterly and annual performance reports for 2018/19.

The UIF reported that it had reduced the time it took to process benefits from 35 days to the current level of 10 days. During the year, it had processed over 720 000 claims. The amount paid out to beneficiaries had increased from just over R7 billion five years ago, to just under R11 billion in 2018/19. The quality of its performance information had received a clean audit, and the human resource management and financial health of the organisation had also received a good rating. However, there were concerns over the quality of the submitted financial statements, supply chain management, and information technology.

The CF said its achievement against its targets had improved from 45% to 67% over the past five years. Some of its challenges it faced included a weak internal control environment due to information communication technology (ICT) system inefficiencies and low skill levels, poor compliance by employers, inefficient business processes and operating models, and fraud syndicates that prey upon the inefficiencies of the Fund.

The Minister acknowledged the Compensation Fund had received disclaimer audit opinions for the past five years, and extended systemic problems going back to 1994 had not been resolved. He had identified IT challenges, lack of skills and fraud and corruption as key factors affecting the Funds performance, and made it clear that strong action would be taken to redress the situation.

Members were critical of the role played by the boards in exercising oversight and providing guidance to the two entities, and questioned the criteria for members’ selection. They showed concern regarding the volume of claims for payments in monetary value that portrayed inadequate monitoring by management, which gave room for manipulation and fraud. They expressed their views on accounting/financial irregularities, the lack of consequence management, the shortage of skills, as well as the interventions needed to move forward.

Meeting report

Chairperson’s opening remarks

The Chairperson reminded the Department of the important role of the Unemployment Insurance Fund (UIF), especially as it directly affected the lives of ordinary people. The ultimate aim should be to pay attention to the vulnerable in society and find sustainable ways of addressing the unemployment challenges in ways that could empower and assist the youth. She made reference to the Desmond Tutu’s memorial lecture made by a business person, describing it as profound, and encouraged Members to observe events like that to be educated in creative ways of exerting their expertise in taking care of both the harassed and victimised youths, in order to assist and advise. She commented that trade unionism was a very difficult and risky task, and had been what had informed the formation of the Commission for Conciliation, Mediation and Arbitration (CCMA) by Charles Nupen. She called for more attention to be paid to the vulnerable in society. Members should be accessible to the ordinary people and listen to them. The Labour Department was facing a critical time, as they were tasked with the responsibility of creating jobs and empowering the youths to create a conducive environment for businesses to thrive. Therefore creative and new ideas should be pondered on to alleviate the suffering of the young people. It must not be business as usual. New ideas should therefore be unpacked.

After dealing with the welcomes and apologies, she asked the Commissioner of the Compensation Fund (CF), Mr Vuyo Mafata, if the person dealing with CF had a medical background. The commissioner confirmed that she had a qualification in occupational health. She then called on the entity to make its presentation, but the Minister interjected.

Minister’s comments

Mr Thulas Nxesi, Minister of Employment and Labour, mentioned the closure of one of their facilities that was currently affecting them negatively. He reminded the Committee about their commitment in taking the role of oversight and their mandated responsibility as a Committee to be held accountable very seriously, because accountability was the very essence of democracy. He reminded Members of how tight both the President and Deputy President had become in terms of their programmes as ministers, and suggested that Parliament should also be as tight, with proper planning from both sides. The President, for instance, allowed no apologies for absenteeism from Cabinet Ministers on certain days. The only exception was when it involved the Portfolio Committees, and apologies could be tolerated as they could bear with the numbers. They were also very tough on study group meetings, and this called for proper planning of Parliament, as meetings were sometimes called, then postponed and cancelled, and that became chaotic. He called on the Chairperson and the whip to be very tight in organising meetings.

The Minister had reviewed the report of the two entities in anticipation of the meeting in relation to the Auditor General’s (AG’s) findings after meeting the AG, and had had a meeting with the two commissioners and some of their staff. He had to share his impression afters five months’ experience with the portfolio.

He opined that the UIF was a “mixed bag,” where there were some negative audit findings, including three new qualifications. For instance, the performance report had been submitted without an error, and the internal control (audit committee) and risk management were deemed to be impeached, while cases of irregular wasteful and fruitless expenditure were being investigated. The commissioner had an action plan to address this finding and had introduced quarterly reporting and was confident of an unqualified audit in the next financial year. However, he had disclosed that what may take time to address was the disclaimer on the social responsibility investigations at smaller unlisted companies, with variable reporting periods. He felt this was more about job preservation and creation, which did not properly suit the reporting format, however. The commissioner was addressing this challenge and hr had no doubt that with the assistance of the AG and National Treasury, a solution could be easily found.

The single-minded purpose to improve service delivery by the UIF was what impressed the Minister. Where claims used to take an average of 35 days to process, it now took 10 days. It was 24 days in the case of the debt benefit cases, and because there was a corresponding massive amount of fraud, and a high degree of investigation was involved to verify a lot of things. Fraudulent acts were very bad and should be checked. The stated target was to handle standard claims within 24 hours, and was being used to improve the service delivery standards. It was introducing a queuing system in the labour centres, introducing WiFi and internet systems to ease and improve the burden of doing business, and employers could now register within 20 minutes. The project to provide online compliant certificates to employers would go live at the end of next month. There was also a programme of taking services to the people via mobile units to reach the remote rural areas, especially the areas of Northern Natal, and the CF was on board with that.

In general, the Minister had a positive feeling about the future of the UIF. He also emphasised the important role it played in job preservation and creation in accordance with the new mandate of the Department of Employment and Labour (DEL). A number of companies in distress had been helped, while the Department had insisted on clear guarantees.

Mr Nxesi said that the CF shared similar systemic problems with the UIF as regards accounting for social responsibility implementation (SRI) issues, and still having responsibility for job preservation and creation. He also pointed out that audit reports and findings had been a mixed bag. They had received numerous negative audit findings this year which he thought Members would require them to explain. In consulting the auditors and the CF, he had the impression that there had been disclaimers for five years, but Commissioner Mafata and had explained to him that it had been a problem for nine years, not five.  The problem had not been resolved since 1994, so they were faced with a deep history of irregular occurrences. If one considered the Public Investment Corporation (PIC) Commission, some of the money had actually come from the UIF and the Compensation Fund. So the nine years of continuous disclaimers pointed to entrenched systemic challenges.

The solution, in his opinion, would be to follow the AG’s recommendations, together with those of the South African Revenue Service (SARS) and Treasury. Unfortunately, some challenges were so systemic that it required a total overhaul of the organisation. They could not be fixed unless the whole organisation was dealt with in terms of skill issues among the people found there. His impression was that that the root cause of the problem was the issue with the information technology (IT) infrastructure and the false start/delivery problems with consultants. The IT issue was not only affecting the DEL, but affected every other department and had become the biggest challenge of government. For instance, the State Information Technology Agency (SITA), which should be used, had never come on board to help the Department.  They would invest millions into programmes SITA introduced, and the personnel would serve their tenure and leave. Afterwards, the next one would come and condemn the previous ones and introduce new programmes that should be purchased. It was a common phenomenon from his experience in the Department of Public Works (DPW), and in many other departments. it was a frustrating experience.

With regard to the challenge of a lack of appropriate personnel to deal with medical aids, insurance and medical rehabilitation, one needed people with the right skills. They all required specialised skills, bearing in mind that it was a huge and complex environment, so the Chairperson’s question earlier was very correct, because those skills were needed.

The Minister agreed that they had witnessed this phenomenon in government, and a very recent one had been the country’s largest property portfolio being managed for years without proper management professionals, which he described as a very serious matter. He asserted that the CF was addressing its systemic issues and that from 2015 it had starting recruiting appropriate skills This was a continuous process, with the intention of building capacity around the office of the chief financial officer (CFO). In the current phase, the focus was to put an integrated IT system in place, improve record keeping and mitigate the menace of fraud and corruption. Therefore, a new system had been launched this month and he had argued with the commissioner and CFO that he wanted to employ technical IT expatriates to act as monitors over what the IT companies were doing. In his opinion, they did not have the right skills. They might have other skills, but when it involved IT one required other IT experts to monitor what was being done. He reiterated that this came with the in-house oversight expertise, as well as the quality assurance on the part of the service providers.

He had to also follow up on the fraud cases reported to SAPS, but the ugly experience in the DPW when reporting cases to be followed up by the relevant agencies, was that cases were inconclusive and it was shocking to realise that nothing had been done after two to three years of reporting a case. He suggested that the CFO restructure its governance structures to ensure that greater value and oversight was provided and again ensure that the right skills were in place. He emphasised that it was one thing to have a person from Labour and another to have the person participate meaningfully in the activities of labour, especially when huge amounts running into billions of rands that involved highly technical matters were concerned. People could easily conclude that the labour board members were involved and query why they were not held accountable for things that were not going right, so he might therefore call for a review of the advisory board and even engage the stake holders themselves.

He also reported that the CFO was also currently streamlining the risk assessment module. It was currently in the hands of the National Economic Development and Labour Council (Nedlac), and should greatly assist through the prototypes. At the same time, the CFO was involved in a strategic shift, using its small surpluses to move away from perpetual training of sometimes devious benefits, to preserving and creating jobs. Again, this was in line with the new employment mandate. Some of the Sector Education and Training Authorities (SETAs) were training for sake of training, and he had challenged the two entities on that. He had interrogated them by saying they could not just release such large funds without interrogating the quality of the training, and had suggested that what could happen was a lot of money being released for over three years to people who had presented attractive proposal, only for it to be squandered in vain, as the impact such programmes for beneficiaries remained questionable. He had told the Director General that he wanted to interrogate all the training that had been done, and had suspended the current programmes until he was satisfied -- even if they would say they had a signed agreement. In future engagements with the CFO, he had suggested having a debate on the implications of the National Health Insurance (NHI) bill for the Compensation Fund.

His overview was therefore that, in the short term, the commissioner must have an action plan to address the negative findings of the AG. For his part, he had been able to do it with the DPW works, even though he did not get a clean audit, but there had been a process. He would be having constant meetings with them, together with the AG. The problem lay in dealing with the backlog on the finances, and working on strategies so there was a turnaround plan in place to address the long term systemic issues in order to build a befitting organisation with the requisite skills, structures and appropriate IT. It was not expected to happen overnight, but he emphasised to the management before the Portfolio Committee that he was going to be hard on consequence management, from the commissioner downwards, because there was a mistaken impression that consequence management was meant only for people at the lower levels. Therefore, an employee who was not delivering must resign honourably and be replaced by a person who was willing to deliver. His focus would not be on the commissioner and the CFOs, but the whole management must know what they were doing to merit the good salaries they were paid.

He acknowledged that there were problems, and these had been aggravated by the fact that they had lingered on for more than ten years.

The Chairperson thanked the Minister for the profound issues he had raised, and said the Committee would reflect on them at later stage.


Unemployment Insurance Fund (UIF): Annual Report

Mr Teboho Maruping, UIF Commissioner, described the issues of concern regarding the audit performance information, and gave a review of the outstanding information. The internal audit validation of reported performance showed the progress made on what the auditor had picked up. It took 35 days to process benefits previously, and their target for all claims combined had been 90% within 35 days. Their overall performance showed that the UIF had achieved 89% of claims processed within 35 days for 20181/19, during which they received over 720 000 claims, and 80% of them were unemployment benefit claims.  The unemployment and in-service costs, and death benefit proceeds, were all highlighted.

The review of 2018/19 targets indicated that the unemployment benefit aimed for a 90% settlement within 15 days, in-service for 90% within 10 days, and deceased benefit for 90% within 20 days.  In quarter 1 they had achieved 91%, in quarter 2 94%, in quarter 3 96%, and they had closed the year with 94% benefits paid.

The financial performance for the past five years showed a steady increase in UIF contributions. The benefits paid out had increased from R7.08 billion in 2014/15 to R10.99 billion in 2018/19 due to the UIF Amendment bill approved by the Committee. They had missed their vacancy rate target of 10% by 3.3%.  On audit, the quality of performance information received a clean audit. The human resource management and financial health of the organisation all received a good rating. However, there were concerns about the quality of submitted financial statements, supply chain management and information technology.


Compensation Fund

Mr Vuyo Mafata, Compensation Fund Commissioner, presented an overview of the CF, including its non-financial performance, the challenges faced and the action plan to address the challenges. The financials were presented by the chief financial officer.

The quarter 4 report reflected the performance of the organisation for the whole year. The strategic objective for quality medical and client-centered care was to provide faster, reliable, and accessible Compensation for Occupational Injuries and Diseases (COID) services by 2020. Regarding the people and performance strategic priority, the objective was to provide an effective and efficient client-oriented support system.

The five-year overall review indicated that performance had improved from a 45% achievement in 2014/15, to 67% in the 2018/19 financial year. A target of 75% had been set for the assessment of employers, and 65% had been achieved. Three of the nine overall indicators were not achieved.

Some of the challenges faced by the Compensation Fund included a weak internal control environment due to ICT system inefficiencies and skill levels, poor compliance levels by the employers, inefficient business processes and operating models, fraud syndicates which prey on the inefficiencies of the fund, and the inability to attract the required skills and expertise.

The action plan to address the challenges include implementation of the CFs action plan being implemented over a three-year period, a complementary audit action plan aimed at correcting the findings and weaknesses identified by the assurance bodies, and a review of the strategic and operational risk register, with mitigation action.


Mr S Mdabe (ANC) raised concerns based on the overview input of the Minister concerning the UIF and the CF, and also reflected on the report of the AG. When one goes through the reports, one hardly finds any comments on the advisory boards in respect of their judicial duty over the functionality and effectiveness of the two entities. One of the questions one could raise was the processes and procedures put in place, be it at the policy level, such as the one that concerned board members’ appointments, taking into account the opening comments made by the Chairperson regarding the mandates of these funds.

The AG’s report on the UIF stated that management did not implement adequate control of funds relating to daily and monthly processes and reconciliation of transactions. The volumes and claims of payments in monetary value had raised serious concerns in that regard, and therefore there was a tendency for fraud and manipulation if there were inadequate monitoring tools put in place by management. This was therefore linked to the skills audit issue as to whether management had the capacity to do what they were employed to do, which was a serious concern.

Secondly, the AG’s report had made some recommendations to the Portfolio Committee. They should follow through all the issues that had been raised in the auditing process and findings. He asserted that there appeared to be no plan to mitigate the AG’s findings, and that was a serious concern -- without an action plan, the Committee would become a party to issues of oversight responsibility on matters raised, and it therefore needed to take action.

The Compensation Fund’s annual report indicated that areas of concern raised at quarterly audit committee meetings had been identified at previous meetings as requiring mitigation and attention from management.  There were very serious issues raised by the audit committee that reflected on the integrity of the accounting authority, and if these matters had been raised directly to him and presented to the government structures, the immediate thing he would do was to ask those responsible to resign, because these were very serious issues.

As pointed out earlier, it was a concern that there were board members who appeared to be missing. In his limited understanding, the audit committee would present to the board, and one does not find the comments or the actions taken by the board members. In his opinion, board members should participate, as they were appointed to do oversight over these entities for government. He proposed that they be invited to the Portfolio Committee to discuss these issues in order to get an understanding of what justified the payments they received to perform their function -- or non-performance of their function..

On the management issue, he proposed that the Minister should deal with all the issues raised. Of serious concern were the alleged issues of fraud and corruption. If an entity received an adverse audit finding for nine consecutive years, then it was a serious concern. A plan of action to deal with the systems, such as IT governance and infrastructure, should probably have been developed five years ago, as these challenges had prevailed for a long time. Now, nine years later, it appears to be business as usual, and there had never been any consequence management according to the report before them.

It would be appreciated to receive a progress report on the interventions, because the AG’s report indicated that he could not express a view on what had been presented to him, and that presented a very serious challenge. The AG had commented that due to the limitations imposed on the audit by management, he had had to stamp his opinion on the financial statement. However, but for the legislated requirement to perform the audit as a public servant, he would have withdrawn from engagements with International Standards on Auditing (ISA). Mr Mdabe suggested that the audit report was worrisome, and if the AG could express that comment, it meant that they would have to close the door of the Compensation Fund as an entity,.

Mr N Hinana (DA) thought that the Committee should appreciate the intention of the Minister to intervene on both audits. He reiterated the fact that there were a lot of fraudulent activities going on, most of which had been confirmed by the Minister, where medical doctors were engaged in businesses with patients, giving loans to them and making claims from the funds. Some of the identified cases had been dealt with, and the implicated doctors had been deregistered. He therefore commended the Minister for implementing an intervention strategy as a stern measure to curb such a menace. The other issue he had raised was the focus on employers. Here, employment issues were discussed regarding people that were employed, retrenched or dismissed for whatever reasons, and in the end they got insurances that were paid. He asked how long one qualified as beneficiaries, because there were other people who were unemployed for up to three years. How long insurance did the benefit from the former employer continue?

He said the mandate of the DEL required the UIF to review its operation and concentrate on job creation, including financial support in the labour market through the Learner Assessment Portfolio (LAP). He asked how far the concentration on job creation had gone in terms of absorbing the people who were unemployed because it was one of its functions, especially as they were being confronted with a 29% unemployment rate. The Department therefore had a responsibility to activate job creation for the people of South Africa. He asked if there could be assurance of the good interventions highlighted, and when their achievements could be assessed in respect of challenges and progress.

Mr M Nontsele (ANC) pledged the Committee’s support to the Minster to ensure that the challenges raised as areas of concern were collectively handled, to ensure that a turnaround plan was implemented. He agreed with the points raised by Mr Mdabe. Considering the UIF, the report indicated that the fund had crashed from an unqualified to qualified audit outcome, and one of the major reasons that contributed to that had been an outstanding investigation into irregular expenditure of R18.3 million that was still outstanding. This was a critical area that had to be urgently scrutinised by the UIF.

The second issue raised concerned the boards. He had been amazed to see that the UIF board was composed of 15 members -- 14 males and just one female -- and advised that that should be addressed as well as a part of turnaround plan. Regarding the Compensation Fund, he felt an engagement with the board was necessary because the overriding area of concern was that all the reports excluded comments or opinions of the board. He described that as serious and if it was an omission, it should be stated as such.

The Chairperson referred to the UIF issue regarding the collection of revenue, and asked that if in five years they had been able to collect R19 billion, who were the people that had been registered? Which sectors were involved? Had every one of the domestic servants registered for UIF, because they were the vulnerable ones? She challenged everyone on that because as portfolio leaders, they should lead by example.

Minister’s response

Minister Nxesi started off with responses to three points. He reported that he was in the process of meeting the two boards, as he intended to listen carefully and explain their role to them, due to his dissatisfaction. His concern was why the disclaimer was under the radar; as there was not much detail about the disclaimer, even at the public level. He compared this to the way in which they had been pursued while serving at the DPW for two years, whereas others who had all these issues were under the radar. Secondly, he had giving the management of the turnaround plan 10 days to come up with a strategy, and by next week there would be another meeting with them.

He acknowledged that there were many other issues linked to the entire Department, because there were problems in the whole organisation and until the entire organisation was dealt with, the issues could not be resolved. Other areas required finance to deal with their issues quickly, so he would be meeting with the stakeholders that recommended people for the board, firstly to deal with the issue of the representation, and secondly to talk about people with the right skills.  In discussions with the management, he would raise the need for some inside unit. For instance, he had incorporated a unit in the GPW called the Governance, Risk and Compliance (GRC) unit. He intended to recruit people from outside to check corruption and charge those found guilty. The frustration he expressed was that relying on other agencies had a time risk attached to it -- people took their time to get things done. If an inside unit was established to crack the whip on most things, especially regarding corruption, this would indeed be very helpful.

He had heard the concerns raised by Members which resonated with him, and he would allow the commissioners to react to them. It might be important for a progress report on their turnaround to be produced on a bi-monthly basis, so that they all would understand how serious the issues were. He had recently approached the Minister of Finance for help, and would do same for SARS to assist in collecting what they ought to collect.

Ms Boitumelo Moloi, Deputy Minister, DEL, said that since the Minister had asked for a meeting with the boards of the two entities, her focus would be on the boards’ performance, especially that of the UIF. She agreed with the Minister that in future meetings, they had to come up with progress reports on the board’s recommendation that the UIF must come up with plans and activities which address the implementation of the job submit and the State of the Nation (SONA) outcomes. There should be an update that explained what they had achieved, especially those that concerned the National Economic Development and Labour Council (Nedlac). It should become part of their reporting to engage the board and ask relevant questions on what they were doing, to let them reflect on the responsibilities delegated to them by the job submit that emanated from the SONA, and practically ask what their programmes are. They should be able to monitor and report back, which would be beneficial to all the people out there who were relying on the Department for employment creation and support.

The Minister interjected, and said that if there was any need for forensic investigations, he would not hesitate to implement them, especially where some of the things were inexplicable.

UIF’s response

Mr Maruping said he felt both the Minister and Deputy Minister had addressed some of the issues related to the board. However, the presentation had shown some of the progress made by the board that reflected on some of their decisions and recommendations during the five years they were involved with the work. Regarding the implementation of the job summit and SONA outcomes, a report would be given to the Committee at a later stage, as recommended by the Minister and Deputy Minister.

One area of concern related to the skills of the board members. He said the way the boards were selected involved choices by organised labour, business, government and the community, but whether they were relevant to the complexities that the UIF and the CF faced was a different story. This was because when they met with the board, they discuss investment and make investment decisions, and whether they were in a position to help them thrive in that environment was another matter. So the two commissioners had to grapple with that, as they were given no choice in the selection of the board members they had to work with, and they agreed with the sentiments concerning the board shared by both the Minister and his deputy. They were happy that the bull had been taken by the horns, and were quite excited to hear the feedback too.

He reacted to the Chairperson’s comments on sector specific issues, and whether the investor contribution claims could be broken into sectors. He said that in due time, that would be reported -- the data was available and could be made available to the Committee.

On the question raised by Mr Hinana on how long members could benefit, it was recommended that members must benefit from the UIF for 12 months, and therefore their expenditure for benefits had increased from R7 billion to R10 billion, because the beneficiaries were benefiting for much longer. They were also involved with programmes that brought the beneficiaries back to employment, which the Minister had touched on earlier. There was a need to assess how to address training, so that the training actually introduced people into employment.

On the implementation of the action plan, he had given the board 10 days to develop an action plan, with a root cause analysis and timeframes. Reports would be brought to the Committee to describe exactly what they were doing.

Ms Thumbuka, Chief Financial Officer (CFO), UIF responded to the question concerning the investigation into the R13 million irregular and wasteful expenditure which had been highlighted by the AG. They had been supposed to identify the irregular expenditure and investigate it within 30 days, but they had finalised it only after 30 days. She added that the unit that was involved in the investigation had currently finalised it.

On the question concerning contributions and the increases in members’ benefits, fortunately they were able to pay the contributions and still had some surplus left. As they went further with the implementation of the UIF, the benefits would start corresponding with the contributions, as they were improving their contributions and ensuring that their beneficiaries got what they deserved

CF’s response

Mr Mafata said he had noted all the comments raised, and acknowledged that the CF faced major challenges. They had spoken about them at length, and the AG had also highlighted them in the audit report. They were busy working on them, trying to address the issues. One of the challenges that had been discussed had been to do a skills audit in order to resolve the skills issues. If one looked at them, unlike the UIF, they were not giving the excuse of saying they were new. Everyone present had been selected based on a skills audit that had identified where a skill was needed, so the entire executive of the CF had been employed over the last three years to try and address the issues of skills. They had done this throughout the organisation, and even with the recent restructuring, they were trying to build a lot of the capacity they did not have in the financial management space, as well as in the core business area, to ensure that some of the issues were addressed. Some of the plans that were put in place were on a long term basis, to ensure that the root causes of the systemic problems that exist in the CF were tackled. This might take some time, but the CF would be happy to appear again with the action plans that they had developed to try and address these issues, as well as what would be added in terms of the short term plan that the Minister had asked them to develop. To try and address a lot of the quick wings that they may have been unable to address while still in the process of the long term plans to try and get the font in its rightful place.

Chairperson’s comments

The Chairperson commented that they had been able to be open and frank to some extent. They were not going to allow the Compensation Fund to go the ESKOM way, where everyone had been apprehensive about what was being exposed, but had done nothing. Before a whistle-blower did something, they had to do something. To avoid hitches, there would have be a dialogue with them, because it involved huge sums of money, and it should not continue that way.

She said thanked the Members for raising such deep issues, and asked for the boards’ understanding that the points were being raised because of their concerns, and nothing else. The Committee wanted to leave a good legacy by ensuring that the ordinary people benefited from the efforts of the Department. They should ensure that the locals and councillors of the particular ward were present when they went on outreach programmes, and take note of the constituency offices that were available there. The venue/locations of the outreach meetings must be communicated early. They had to lead together in assisting their people. The day’s meeting should be an eye opener to everyone to indicate that “work had started”, and therefore everyone had a responsibility to forge ahead.

She reminded Members that they were going to be preparing for the Budget Review and Recommendations Report (BRRR).

Deputy Minister Moloi assured the Chairperson that they had noted her comments, and pledged their commitment to ensure they played their oversight role. The two entities had been engaged and told that everybody had to play their part, and there would be no place to hide anymore. Issues must be definitely dealt with as they arose.

The other issues were those raised by the AG as fruitless and wasteful expenditure. There was a need for them to regularise and follow the processes, because some matters would have to be regularised and condoned in other to be removed from the books of the AG. Regarding the jargon of the AG in the accounting principles, she said if they did not conform they would forever remain as issues and queries from the office of the AG. Therefore, when they were engaging them, they should bring along a checklist that explained the necessary condoning and regularising, and the processes that must be pursued. If that was done, the AG should be able to exonerate them, so they should do those relevant things they needed to do and follow through in order to get a better report.

It would be important to follow through with the boards. She felt that this was where the problem might be, because the boards were also supposed to play their oversight role over the executive, and the management and queries indicated what they were doing if they were not playing those roles, and suggested that they should probe them also. Therefore the process was under way. They were going to be meeting with them to check all the challenges that should be unlocked, and offer themselves as well to help when necessary. Constant feedback would be given to the portfolio Committee.

The Department also had various service delivery meetings, and took the DEL to the people as well, so when they go to the provinces their plans and itinerary would be presented to the Committee. She urged available Members to join them also, to see what was involved, and the services they were bringing to the people. She felt they were doing something, even though it was not in a large scale but incrementally they try to take the entities and the DEL. to the people to engage with them and find out what the problems were.

The meeting was adjourned.

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