Appropriation Bill: Public Service Commission briefing

Standing Committee on Appropriations

04 May 2020
Chairperson: Mr S Buthelezi (ANC)
Share this page:

Meeting Summary

Video: Standing Committee on Appropriations, 04 May 2020

The Public Service Commission (PSC) briefed the Committee on the 2020 Appropriation Bill, and highlighted that the difficulties arising from the COVID-19 pandemic had provided lessons on the agility of the government and public administration as a whole. It proposed that Parliament should conduct some of its meetings online in future, and use the resources that would have been allocated to travel expenses for presenters, towards people’s needs instead.

The PSC identified the following issues as having been heightened by the COVID-19 pandemic:

  • Service delivery. Attention had to be given to building organisational and technical capacity.

  • Procurement in public service and administration. This had to be attended to, to avoid the waste of state resources but also to ensure it was used as a mechanism to support small businesses. Every cent must be committed towards localisation.

  • The budget implications of infrastructure required for information and communication technology (ICT) enhancement. ICT enhancement was critical at the moment.

The implications of budget cuts on staffing generally meant the shrinking of head counts that often ignored the value chain of delivering services or key services that should instead be bolstered, such as health, police and schools. Massive works programmes such as the expanded public works programme (EPWP) should be expanded, and focus on supporting social welfare and health care functions.

Post COVID-19, pressure was going to be on government to enhance its capacity to deliver public services, especially for the vulnerable in society. This included the mobilisation of resources by the state to ensure and enable service delivery. There was a need to find a balance between building a capable state and cost cutting measures, which would require innovation to facilitate effective and efficient service delivery and performance.

The Committee raised concerns over the poor procurement processes that had affected the supply of personal protective equipment (PPE), food parcel distribution and water tanks. Members also expressed their dismay over the non-payment of invoices older than 30 days to small, medium and micro enterprises (SMMEs), and stressed the need for efficiency, effectiveness and value for money in public spending. They called for the public service to intensify its up-skilling and training efforts.

Meeting report

2020 Appropriation Bill: Briefing by Public Service Commission (PSC)

Ms Phumelele Nzimande, Commissioner: Public Service Commission (PSC), remarked that the PSC’s input was being made on the 2020 Appropriation Bill “as is,” and acknowledged the Minister of Finance’s announcement that he would revise the budget in the near future. The principles in the presentation should still guide the Committee on the framing of the new budget. The difficulties arising from the COVID-19 pandemic had provided lessons about the agility of the government and public administration as a whole. For instance, the pandemic had necessitated virtual meetings, which had been suggested previously to save on travel and accommodation costs to Cape Town for meetings.

Ms Irene Mathenjwa, Deputy Director–General: Monitoring and Evaluation, said the PSC was an independent constitutional body mandated to provide oversight over the national and provincial public service. She highlighted its areas of oversight and its constitutional values and principles. The principles were in section 195 of the Constitution, which were to guide public administration and its development, the efficient and effective use of economic resources, human resource management, and a high standard of professional ethics. The founding principles were to guide the development of public administration and to achieve national targets.

The following issues had been raised with the Committee before, and had been heightened amidst the COVID-19 pandemic:

  • Service delivery. Attention had to be given to building organisational and technical capacity.

  • Procurement in public service and administration. This had to be attended to, to avoid the waste of state resources but also to ensure it was used as a mechanism to support small businesses. Every cent must be committed towards localisation.

  • The budget implications of infrastructure required for information and communication technology (ICT) enhancement. ICT enhancement was critical at the moment.

Regarding the Appropriation Bill, the PSC appreciated the stimulus injection to mitigate the impact of the COVID-19, which showed the government cared about its people. The government should respond with transparency and accountability, and not use fast-tracked procurement during the pandemic to loot state resources. A high standard of professional ethics and integrity must be maintained. For any amendments to the Appropriation Bill, a risk-based approach must be taken in order to identify what the risk associated with the reprioritisation was, and the mitigation plan to deal with those risks.

The implications of budget cuts on staffing generally meant the shrinking of head counts that often ignored the value chain of delivering services or key services that should instead be bolstered, such as health, police and schools. Massive works programmes such as the expanded public works programme (EPWP) should be expanded and focus on supporting social welfare and health-care functions, and preventative measures from cleaning schools, parks and playground equipment, to disinfecting bus and taxi ranks and taxis. This would lay the basis for a job guarantee scheme

COVID-19 had created an opportunity for serious reflection at all levels. The failure to deliver on government policies disadvantages future generations and inflicts disproportionate pain on the poor. A case in point was the policy of digital migration for South Africa approved by Cabinet in 2010. Online service delivery channels had to be increased and enhanced. For this purpose, departments must ensure their readiness to capacitate employees to deliver services online with efficiency. The strengthening of digital infrastructure and accelerating the roll out and usage of technology through broadband should be a key national and continental priority for all sectors.

In order to improve management practices in the public service, planning should include cost-benefit trade-offs between different service delivery options. Without this, efficiency and effectiveness cannot be optimized, because the cost and service delivery outcome of different resource provision and service level options cannot be weighed. An example would be the distribution of the food parcels and the need to evaluate what delivery options could save the government money. There was a need to fast-track the district delivery model (DDM) implementation, which provides a focused and coordinated intergovernmental attention to the districts. Plans should include financial modeling as a means to direct increasing scarce resources to where they were needed, and an element of flexibility to facilitate effective and efficient implementation.

The delegation of powers and duties should be made to appropriate performance levels within the Public Service, to fast track service delivery. The PSC receives complaints about a lack of leadership and management at various levels. A worrying factor was the inability of departments’ internal controls and monitoring systems to timeously pick up service delivery concerns. Managers at various levels feel that they have a lack of agency. One way to address this lack of agency was to review the management structures of the public service, which would require a better alignment of responsibility, authority and accountability.

Regarding opportunities for efficiency, effectiveness and value for money, one of the key areas was the Wage Bill -- specifically, the excessive salaries in the public entities and municipalities, and in particular the executives and the board members. In light of COVID-19, consideration should be made to negotiate non-payment of performance rewards for the public service and the entire public administration for the current financial period.

The PSC was concerned with the cost of doing business. State resources were under severe pressure due to the country’s poor economic performance, which had been exacerbated by COVID-19. This could be reduced by re-evaluating certain services, such as the public service health risk assessment. Instead of being outsourced, Government should make use of its large number of health practitioners for assessment. Where internal capacity exists, departments should not be allowed to use consultants. Strategies should be put in place to deal with the aftermath of the lockdown in terms of unprofessional and unethical conduct of public servants, with particular emphasis on litigation. An example of the abuse of power was the recent death of a young man at the hands of the South African National Defence Force (SANDF). Lastly, there should be gainful employment by training public servants employed in non-essential services to perform other functions, such as providing non-medical support at hospitals.

No new data had been received, so the highlighted issues of governance referred to performance data up until 2018/19. Regarding the standard of professional ethics, ethics had been reduced to constitutional issues like disclosure of conflict of interest, appointment of an ethics officer, management of sexual harassment in the workplace, and anti-corruption strategies. Ethics needed to go beyond this, and there should be proper feedback on the behaviour of officials and the impact thereof on service delivery and the citizens.

Some departments demonstrate a misalignment between the expenditure against the allocated budget and the achievement of the planned targets. The departments that require massive injections were the ones which were found (historically) not to be delivering according to their objectives -- particularly the Departments of Health and Social Development. These departments need to put measures in place to deal with shortcoming to improve performance and service delivery.

Another issue was the non-payment of invoices older than 30 days. Despite the reduction in the number of invoices older than 30 days and non-payment, there had been a significant increase in the related costs. Small businesses suffered the most from this. The main transgressors contributing to this at the national level were the Departments of Water and Sanitation, Agriculture, Public Works, Cooperative Governance and Traditional Affairs (CoGTA), Social Development, and Women. National Treasury should provide direction on actions to be taken by departments for officials responsible for the non-payment of service providers within the stipulated timeframe. Amidst COVID-19, officials need to find time in their offices to process payments to suppliers.

South Africa’s historical spatial planning had largely affected the development and equitable provision of services in the rural areas, especially in the peri-urban and rural areas. Challenges currently being experienced during COVID-19 were the distribution of food parcels and placement of water tanks. Therefore, the issue of impartiality and equitable service delivery needed to be addressed. People’s needs must be responded to and public participation encouraged.

Regarding human resource management, data on skills needs to change from ‘courses attended’ or simply counting how many had been trained, to ‘tasks that employees were proficient in.’ In relation to COVID-19, Government would have to improve its systems for remote management, to ensure productivity from those working from home.

In conclusion, post COVID-19, pressure was going to be on government to enhance its capacity to deliver public services, especially for the vulnerable in society. This included the mobilisation of resources by the state to ensure and enable service delivery. There was a need to find a balance between building a capable state and cost cutting measures, which would require innovation to facilitate effective and efficient service delivery and performance.

Lastly, there needed to be proper management of public funds, which required:

  • Setting up proper accountability frameworks (aligning responsibility, authority and accountability).

  • Detection of present unauthorised, irregular, fruitless and wasteful expenditure, and disciplinary action being taken against negligent officials.

(See presentation)

Discussion

The Chairperson said the presentation was good in coming up with problem statements, but it had lacked suggestions on what should be done.

Mr Z Mlenzana (ANC) raised two concerns regarding the Wage Bill and the use of consultants’ suggestions:

  • What was the PSC’s assessment of the current situation?

  • If the worst case scenario occurred, what were the implications for public finances and the state? Did

the PSC have any input on which Government programmes should be scaled-down or discontinued to try and salvage resources?

Ms Nzimande responded that the PSC had identified areas in which there could be cuts, and would share the report on this.

Ms Mathenjwa said the PSC would also make its report on the 30 day non-payment issue available to the Committee. Areas in which cuts could be made were the performance bonuses and the compensation of employees, such as the salaries of DGs and executives in departments.

Mr A Shaik-Emam (NFP) said that the current government had had 26 years to improve the quality of life, and should stop making reference to pre-1994 to find excuses. South Africa had the skills capacity, as billions of rands were injected into tertiary institutions annually, yet there was an unemployment rate of 30%. Why was that the case? Was there a lack of skills coordination? What needed to be done differently after the COVID-19 pandemic?

Regarding the issue of food parcels not reaching the vulnerable, municipalities or public representatives of wards should have a database with information on households in that ward, the unemployment rates, the skills pool, and so forth.

The planning and budget process problem needed a bottom-up approach that first engages with the community on their needs. However, the budget process was currently a top-down approach forced on the community.

Regarding the issues with management across the public sector, should there be a separation of politics from administration or employment delegation?

Regarding the internal control measures, and the high cost of doing business, how far in discussion was the PSC and National Treasury on implementing an open tender process?

Ms Nzimande responded that the PSC had not done work on the open tender system. National Treasury would be better positioned to respond on how it had unfolded.

Ms Mathenjwa said the issue was not skills capacity per se, as the country had qualified and skilled people. The issue was whether the skills translated into public sector development.

Mr O Mathafa (ANC) said he had noted several solutions in the comments during the presentation. He requested that the inputs made by the PSC be submitted as a firm proposal, particularly the inputs regarding the issue of non-payment to suppliers for over 30 days.

On the issue of procurement processes, what was the PSC’s view on the measures government and management could implement to ensure that the solidarity and disaster management funds were protected from looting? How much did the savings from not-travelling to Cape Town impact the budget, and would the PSC recommend virtual meetings going forward?

Ms D Peters (ANC) asked what the PSC was doing to hold officials accountable for non-payment, as non-payment was always linked to corruption. The issue of risk-assessors and consultants had been raised before. The PSC should impress on the Minister of Public Service and Administration, the need to use the national health sector to conduct the assessments. The EPWP, the Community Work Programme (CWP) and community development workers (CDWs) were a cohort of human capital available for government to use as support for the Department of Education with the school preparation projects. This cohort could also help with the creation of the community database mentioned earlier. Did the PSC think COVID-19 would send the government back to the drawing board regarding the National Development Plan (NDP)? Regarding the recommendation for back office staff to be allowed back to work, she requested the PSC to engage with the Ministry of Public Service and Administration on the matter.

She argued that the Department of Social Development should not be a department of grants, but was meant to focus on social issues. How could it go about deploying social workers instead of distributing grants?

Ms Mathenjwa said the PSC was in discussion with the Ministry of Public Service and Administration on several issues. The PSC did not think the NDP targets would necessarily change, although the medium term expenditure framework (MTEF) would change.

Ms N Ntlangwini (EFF) suggested the Committee should make a proposal on the non-payment of small businesses. She requested the PSC to give the Committee a spreadsheet on the five departments who were the main transgressors, indicating which companies had not been paid, why, and for how long the payments had been outstanding. She agreed with not using consultants at the moment.

Regarding procurement, personal protective equipment (PPE) needed to be checked, as there were still instances of staff fighting over PPE because it was not being received. What was the role of this Department in tracing the purchase of PPE and ensuring it went to the relevant people? What was the process for ensuring the water tanks were also being used to help the communities?

Ms Nzimande replied that the PSC would share the spreadsheet information on the five departments with the Committee. The PSC had summoned the Directors General and heads of departments from these departments. She requested the Committee to also assist by asking all departments how they were performing with respect to payments, before presenting to Parliament.

Mr D Joseph (DA) emphasised the need to work with other departments to speed up the Procurement Amendment Bill. What was the PSC’s view on the proposed budget cuts, and what were the core services? Regarding the Wage Bill recommendation, the presentation referred to municipalities -- why were the national and provincial departments not mentioned? Regarding the statement that there was a lack of leadership, what did the PSC mean by this? On the issue of poor data skills, was there a set of skills that the PSC would define as critical? What types of skills were needed to take the government forward in the fourth industrial revolution?

Ms M Dikgale (ANC) said one of the values of the constitution was that people’s needs must be attended to. She agreed with the Commission’s recommendation to look at the issue of non-payment. She mentioned an oversight experience in Gauteng, where there had been incidents of non-payment of over three years.

Mr A Sarupen (DA) asked if the 30-day invoices referred to both provincial and local government? What did the picture look like beyond 30 days for all three levels of government? Did the PSC have any suggestions on how to get provincial and local government back on track with payments? Regarding the recommendation for public service upskilling for auxiliary services, had the PSC identified areas for optimising on the channelling of training bursaries for public servants?

Ms Nzimande responded that the mandate of the PSC was largely national and provincial, but the PSC did make comments on how things could be done in local government. The bursaries were supposed to be linked to performance assessments, but this was not the case.

Mr X Qayiso (ANC) asked what the PSC’s advice was on how to go about doing Parliamentary oversight during this time? Regarding cleaning in the public service, would in-sourcing not reduce costs, and should the PSC not fast-track this? Regarding the renewal of contracts with consultants, had the PSC ever done an audit on these contracts? Could there be drastic consequence management mechanisms to deal with the issue of non-payment?

Ms Nzimande said there should be some agility in government, where Parliament could conduct meetings online and use the resources that would have been allocated to travel expenses towards people’s needs instead. There were many areas in which government could in-source service delivery. Building internal capacity was important for sustainable service delivery.

The Chairperson said that the issues raised by Members in the meeting had been raised previously. He proposed the following format be used in future engagements: problem statements from Members and presenters, followed by interventions, and lastly the outcome. He requested the PSC to come back and report back on the issues raised by Members of the Committee. What type of cooperation was the PSC getting from the departments? Because of the high cost of doing business, payment to small businesses was critical for economic growth. Regarding procurement issues, administrators procured public goods, not politicians. However, the administrators were not being held accountable. What could be done about this? Did the PSC think government was getting value for money from the School of Governance? There was a yearly issue of overspending in academic institutions, which was an indication of poor project management skills. What had led to the under-performance of the Departments of Health and Social Development? What was being done to ensure there was no recurrence of the under-performance?

Ms Nzimande said some of the issues raised by Members would be responded to in the format suggested by the Chairperson. The PSC had done research on the use of consultants, which it was happy to share with the Committee. It had a set of guidelines regarding when and how to use consultants, as well as guidelines on internal capacity to do the work.

On the issue of training and getting value for money, the country had fallen short in the area of training. The School of Governance had gone through evolution, but it could not supplement the training that needed to happen in every sphere of government. Specific training had to happen within individual departments. The School of Governance could provide only generic training. The PSC had provided the School with a proposal on what it could do.

Regarding non-payments to small businesses, this was reflective of management failure within departments. Cooperation from government departments varied. Each province had a commissioner who was responsible for a cluster of departments.

Ms Mathenjwa said the PSC would submit its report on building a capable, career-oriented and professional public service, which addressed issues of training, human resources and delineating politics from the appointment of officials.

The Chairperson announced that a new draft programme had been distributed, which aimed to deal with the Appropriation Bill. The target date for the Committee complete its work was 9 June. There was sufficient time to consult with other departments. The Committee still had to meet with the Parliamentary Budget Office (PBO), the Financial and Fiscal Commission (FFC) and with the Human Sciences Research Council (HSRC) tomorrow.

Members agreed to adopt the programme for the second term.

The Chairperson requested that the minutes be postponed to the next meeting.

The meeting was adjourned.

Download as PDF

You can download this page as a PDF using your browser's print functionality. Click on the "Print" button below and select the "PDF" option under destinations/printers.

See detailed instructions for your browser here.

Share this page: