DPWI on Adjustment Budget & Revised Annual Performance Plan; with Minister

Public Works and Infrastructure

09 July 2020
Chairperson: Mr M Mmoiemang (ANC, Northern Cape) & Ms N Ntobongwana (ANC)
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Meeting Summary

Video: DPWI on Adjusted Budget & Revised Annual Performance Plan

Audio: PC Public Works 9 July 2020 

In a virtual meeting, the Department of Public Works and Infrastructure (DPWI) presented its adjustment budget and revised annual performance plan, and said R1.6 billion had been taken out of its initial allocation of R8 billion – R771 million from the expanded public works programme (EPWP), and R829 million from property and construction industry policy and research.

The R771 million had been reprioritised to support the Departments of Health and Basic Education with the recruitment of expanded public works programme (EPWP) participants to be appointed for COVID-19 activities. These would be youth teams that would provide services such as assisting with the cleaning and sanitisation of schools. The reprioritised R829 million would be used for the implementation of infrastructure projects, the acquisition of personal protective equipment (PPE), facilitation of a contactless work environment, deep cleaning of departmental buildings and courts, and additional information communication technology (ICT) infrastructure and tools. It would also be used to support the Department of Health (DoH) in the procurement and provision of quarantine facilities to accommodate repatriated citizens.

Most of the questions from Members were about the quarantine sites. One of the first concerns raised was how the cost of quarantine sites had escalated. They wanted clarity on how many sites had been procured, where they were, and what the procurement processes and criteria were. The Department responded that adequate quarantine sites had been provided, but the uptake had been slow because of a reluctance by people to use them, mainly because of worries about their domestic situation while they were in isolation. An education campaign was needed to overcome this hurdle.

Members sought clarity on how the reprioritisation of the budget would affect the Department’s target and projects, and now that it had the responsibility for infrastructure development, what role it would play in job creation. They expressed interest in the EPWP project to sanitise schools during the pandemic, but said this had to be backed up by having adequate sanitation and toilet facilities at the schools.

In the second round of questions, the Department was asked about progress with the integration of the infrastructure department, which had been transferred from the Department of Economic Development. Members also wanted clarity on the role of the Development Bank of Southern Africa (DBSA) and its relationship with the Department.

Meeting report

Chairperson Mmoiemang said the meeting would be about the budget adjustments made by the Department of Public Works and Infrastructure (DPWI), based on the announcement made by the Minister of Finance and the directive to the government departments to readjust and respond to the Covid-19 pandemic.

DPWI: Budget adjustments and reprioritisation

Mr Sam Vukela, Director General (DG): DPWI, said the Department had an allocation of R8 billion, with five programmes. R1.6 billion had been taken out – R771 million from the expanded public works programme (EPWP), and R829 million from property and construction industry policy and research. The other three programmes, administration, intergovernmental coordination and prestige policy, remained untouched.

The R771 million had been reprioritised to support the Departments of Health and Basic Education with the recruitment of expanded public works programme (EPWP) participants to be appointed for COVID-19 activities. These would be youth teams that would provide services such as assisting in the cleaning and sanitisation of schools. The reprioritised R829 million would be used for the implementation of infrastructure projects, the acquisition of personal protective equipment (PPE), facilitation of a contactless work environment, deep cleaning of departmental buildings and courts, and additional information communication technology (ICT) infrastructure and tools. It would also be used to support the Department of Health (DoH) in the procurement and provision of quarantine facilities to accommodate repatriated citizens.


Chairperson Mmoiemang thanked Mr Vukela for the brief outline of where the areas of emphasis had been made, and what constituted the R1.6 billion baseline that had been reprioritised into various categories, including the EPWP sector and the Property Management Trading Entity’s (PMTE’s) contribution.

He handed over to co-Chairperson Ntobongwana to facilitate the question and answer session.

Mr M Rayi (ANC, Eastern Cape) wanted clarity on the effect of the budget changes on the annual performance plan (APP). For example, how was the EPWP affected by the reprioritisation of R771 million? What was the effect on the PMTE?

Mr T Brauteseth (DA, Kwazulu-Natal) thanked the Minister and the DG for reducing the prestige policy amounts that would be spent. The Department had listened to the Committee’s advice on that. He expressed concern that the Minister had initially said that R17 million to R28 million would be spent quarantine facilities, but now they were seeing a vastly inflated number -- in the hundreds of millions -- for quarantine facilities. He wanted to know why the number had jumped so much.

He also wanted clarity on Minister Mboweni’s reference in his adjustment speech about R330 billion which would be spent on infrastructure, which would be handled by the DPWI, and a company called Infrastructure South Africa would be set up. There had been no detail at all about that in this adjustment budget. Did that mean that it was not going to be started in this period? If it was, surely it should be in the budget? He asked for details as to what Infrastructure South Africa looked like. Who was going to be populating that particular entity? What were the 55 projects that had been mentioned by the Minister of Finance that made up the R330 billion?

Mr E Mathebula (ANC) commended the Department for a budget that was in line with the situation that the country was currently facing. While there were reprioritisation changes, the amount budgeted for the financial year would not change. However, there were certain things that had been added -- was there a plan in place? There were certain programmes that would suffer as a result of the reprioritisation -- were there plans to replace them, whether in this financial year or some time in the future? He wanted clarity as to when these projects and programmes would be realised.

He also wanted to check whether the Department had any indication that corruption had taken place and if so, how would it deal with it? Could it put mechanisms in place to avoid what they had been seeing and hearing about corruption?

Mr M Nxumalo (IFP) said he hoped there were measures in place to avoid corruption. He asked if the DPWI had found a way to use infrastructure as an economic driver for South Africa, to ensure it became a key driver of the economy moving forward. Had it started to engage on what they would do after this lockdown? What would the role of the Department be moving forward?

Ms L Shabalala (ANC) wanted to know whether the adjusted budget would address job creation, and whether the empowerment would be directed towards women, the youth and vulnerable people. If not, could the Department look into this, as there were a lot of job losses. She also wanted to know how the EPWP was affected. How much of the reprioritisation and amount that had been reallocated to the Department of Basic Education (DBE) would go towards dealing with gender-based violence (GBV)? She requested information on the challenges at the quarantine sites. Sometimes, when one heard about the challenges, one was unsure whether they had been procured by the Department, or by the provinces or municipalities.

Mr E Landsman (ANC, North West) stated that he did not have a lot to say, as most of his questions had already been asked. He just wanted to welcome the report.

The Chairperson read Ms B Mathevula’s (EFF, Limpopo) questions from the comment section, as she had connectivity problems.

Ms Mathevula asked whether the ICT structure for the staff who were unable to go to the office was available provincially or at the national level. Had the Department received any complaints about the quarantine sites in provinces, and how had it responded to such complaints?

Mr M Dangor (ANC, Gauteng) asked whether the Department had budgeted for the future maintenance of the quarantine sites. The premiere in Gauteng had expressed horror that quarantine sites were filling up, and that the private hospitals and public hospitals were full. Was there enough budget for maintenance if this crisis period continued for much longer?

Ms S Graham (DA) asked what sort of modelling had been done, and whether the modelling was being amended as this crisis progressed in respect of the number of quarantine and isolation sites that would be needed. Was there a buffer somewhere, should additional budget become necessary?

She referred to the EPWP programme for cleaning the schools, and asked if the number of 45 445 youths was over and above the initial 25 000, or was it an additional 20 445? Was this going to be done through the non-state sector programme of the Independent Development Trust (IDT)? If so, had the IDT already provided them with a quote of what their management fee would be, or would they get that only at the end of the programme? Had it already commenced? Had it been affective? In the schools where it had been rolled out, had there been fewer infections?

She expressed concern with the preparation that the Committee had received for this meeting. Their researcher and content advisor had put together two documents on this. Over and above the R1.6 billion that everyone was referring to, there was an additional R597 million listed under ports of entry reprioritisation, to fund the quarantine of individuals entering South Africa and the detection of Covid-19 infections. It was a second allocation in connection with the quarantine sites, and this was directly from the National Treasury’s document -- which then put this reallocation of funds at R2.1 billion, as opposed to R1.6 billion. She asked why there was a difference between what National Treasury were presenting in terms of this budget compared to what they were hearing from the Department. 

Ms S van Schalkwyk (ANC) wanted to know whether the terms attached to the cleaning of schools and the non-profit organisation (NPO) programmes would be extended. Did the Department have sufficient money to sustain the terms? She was concerned about the quarantine sites and the private sites that had been acquired, and the huge costs of the hotels, and asked if specific rates for the hotels had been negotiated by Treasury and the Department of Tourism.

Ms M Hicklin (DA) said she noticed from the presentation there was clear distinction between the National Department and the different provinces when dealing with quarantine sites. She wanted to know whether the money allocation was different -- was it allocated from various provinces? If that was the case, why were there no quarantine sites in Northern KwaZulu-Natal? She was trying to help repatriate people who were stranded in Mozambique. The Mozambiquan authorities were saying that there were no quarantine sites for people who needed to go Kwazulu-Natal, so they were not releasing people from Mozambique because they had to be accommodated in Mpumalanga. It was exactly the same problem that they were having with Eswatini. It seemed that there were a lot of quarantine sites in and around the greater metropolitan areas, but very little in rural communities. Yet it was stated that there was a clear distinction between the provincial Members of Executive Councils (MECs), the local municipalities and the national Department’s responsibilities, yet there were no quarantine sites.

Mr W Thring (ACDP) assumed the National Infrastructure Bill’s responsibility was that of the DPWI, so surely this should have been seen in the adjusted budget? If they were not seeing an additional budget coming through, then this became an unfunded mandate. He asked the Minister for clarity. What effect would the suspension and reprioritisation of the R1.6 billion Covid-19 response have on the Department achieving its key outcomes? How much of the R771 million that had been reprioritised to recruit 45 445 participants for ten months to help clean and sanitise schools had actually gone to creating sustainable jobs? While many would appreciate that they would be employed for ten months, with that amount of money the Department could create sustainable jobs and take those participants and upskill them.

He asked for an update on the number of facilities that were available and that have been assessed as being ready. There were 1 400 facilities and of those just about 300 or 400 had been deemed to be ready. Could they have an update on the number of beds that were actually ready -- even a list of schools? There were some governing bodies that were hesitant to call teachers back to schools because the teachers were being asked to sanitise the schools. Was it possible to get a list of all of the schools that had been deep cleaned or sanitised?

Ms A Siwisa (EFF) requested clarity on the schools that would be sanitised. Would they be schools that were already under the DPWI? She remembered that there was a list of schools that the Department was assisting -- was it those schools, or was it all the schools that fell under the Department?  There was already a programme running from the DBE to sanitise schools, so would that programme continue or were they focusing on other schools?

With regard to the EPWP, even before the lockdown there were beneficiaries who were already in the system. Had those people been considered, or had they recruited new people to go and do the sanitising of schools? With the sanitising of the quarantining sites, especially the private sites such as the lodges, was it the responsibility of the Department or was it the responsibility of the owner to make sure the facilities were sanitised? They were still waiting for a list of quarantine sites.

The Committee would continue to speak about quarantine sites and the money allocated to quarantines sites, as they did not want a situation where was a report about fruitless and irregular expenditure, where the buildings did not exist. She had received the report from the North West where they were using a college as a quarantine site. Had these places been cleaned enough?

People wanted to come back to South Africa, but they did not know where they would be quarantined. There had been a lot of issues of people being stuck somewhere. There was an issue of Eastern Cape learners being stuck in a bus for hours because there was no clarity as to where to go. The Committee needed a list to see if these sites were suitable or not. It did not want to find out certain buildings had been paid for, but were not actually in existence. 

Would the Department consider buying PPE from small businesses? There were small companies that produced sanitisers and masks within South Africa.

Mr T Mashele (ANC) what the impact on the programmes where the money was shifted would be. There had been under-spending in the first quarter on these programmes. What was it that the Department had failed to achieve or deliver because of the under-spending? What role would it play post-Covid in terms of job creation? The EPWP was a programme that assisted in job creation. If there was Covid for a long time and unemployment kept rising and the Department reduced the EPWP budget, how did it expect to assist in job creation? When Covid happened, surely it had already started identifying beneficiaries for the EPWP. What was happening to those people? 

The Chairperson referred to the numbers in the EPWP – the 45 000 and 25 000 that had been reported between 20 April and 7 May – and asked the Department to clarify what the actual number was. Were they talking about 45 000 or 20 445? Was the recruitment that had been done by the Department of Health different from that done by the Department of Public Works or the Department of Education to deal with the sanitation?

What was the role if the Departments of Home Affairs and Health on the ports of entry, especially in regard to the quarantine of individuals entering South Africa and the detection of infections?

Chairperson Mmoiemang said that the procurement of Covid-19 goods and services must be in line with the Treasury’s Practice Note, which states that there had to be accountability in terms of services procured. The Committee wanted to know the capacity of the Department in terms of the internal audit of structure for expenditure that took place outside of normal practices.

How would the Covid-19 pandemic affect the infrastructure component that had been added to the DPWI? It was important to get a sense that the changes would not hamper the ability of the Department to implement the infrastructure programme. How was the DPWI assisting the DBE to deal with the 1 600 schools that had been vandalised? With the refocus of the EPWP grants towards cleaning, it was important to get a sense of the interaction that the DPWI was having with the DBE, and also the role that it and its entities at the IDT played in terms of the hygiene strategy and the role played by the NPOs, as the marshalled by the IDT.

Minister’s response

Minister De Lille said she would respond to the quarantine and isolation sites where they were currently, and would also respond to the infrastructure questions. Then the DG and the other colleague could pick up some of the other details. The Minister apologised that a full list of quarantine sites had not been sent to all Members. She would make sure that the list was sent to both portfolio committees the next day.

The Disaster Regulations stipulate that National Department of Public Works and Infrastructure, the provincial departments of public works and local government’s mandates were the same -- that they needed to identify the sites and make them available for quarantine and isolation. In some instances, where these sites had been identified by the provinces and activated by them, they were entitled to do so in terms of the regulations. According to the latest report that she had presented to the National Corona Command Council, they had identified a total of 5 968 sites as proposed quarantine sites and they were allocated all over the country to make sure that they covered all 54 districts and the eight metros. These sites represented about 208 000 beds across the country. 5 333 were privately owned and 653 were state owned.

To date 431 sites had been assessed by the Department of Health (DoH). Once the DPWI identified the sites, the DoH needed to inspect, and they had approved 409 sites that were suitable for quarantine. That represented 41 330 beds, but of these sites that had been passed by the DoH, only 139 facilities had been activated, and currently they were using 12 525 beds for quarantine purposes. The Committee could note that not all the sites that the Department had identified had been approved by the Department of Health. They had also developed a master list where they had included all the sites that had been identified by provinces and by national government on the master list. The Department would give Members access to the master list. They update it regularly, especially when people in the private sector state they have a site available -- that information was put on the database.

There had been a low uptake on quarantine sites across the country. There were various problems, such as in the Western Cape, and in the Eastern Cape, people just refused to go to quarantine sites. When she had joined the President and the Minister of Health for a visit in the Western Cape, Minister Mkhize had asked her to procure 12 000 beds for the Western Cape, and by the end of June they would need 15 000. They had started off the process and had procured six hotels. A few days later they had started receiving calls from the hotels that they had only six or seven people in the hotels. The provincial Department of Health had informed them of the problem where people simply did not want to go to quarantine sites.

There were various reasons. People wanted to know what would happen to their furniture, who would look after their house, what they would eat, could they have visitors, could they smoke and could they have sex. There was a problem with the uptake for these reasons. For example, in the Eastern Cape they had identified 962 sites, but currently only 19 of them had been activated. In the Western Cape they had identified 1 746 sites, and 16 had been activated. When she had presented this to the National Command Council, they had come to the conclusion that they needed to do a big educational drive to explain to people the importance of being quarantined. People who were quarantined were not people who were Covid-19 positive. Some of them were asymptomatic, some of them had a few signs, so they were quarantined as a precaution. That was the latest update.

The DPWI team had also worked with the Federated Hospitality Association of Southern Africa (Fedhasa), the overall umbrella body of the hospitality industry, and the Department of Tourism to help the Department with inspecting and assessing the different sites. There was also a process led by National Treasury to review the current rates that it had approved. There were all these facilities available, but government was the only user, so they had to be in a better position to say they could not afford this.

Because the virus was so unpredictable and changed all the time, the chief financial officer (CFO) had first set aside an amount of R337 million for quarantine sites, The intention was to allocate R100 million to the Western Cape, with the Eastern Cape following hot on its heels. They were currently approaching this very cautiously until there could be a public campaign, and until provinces could improve their contact tracing. They had actually stopped procuring new facilities because of the low uptake. They had been asked to assist Gauteng, and had shown the province what was currently available in the province, which had now overtaken the Western Cape. They had already identified 1 027 sites in Gauteng, and they had activated 21 of those. There was a great need for educating the people on the importance of quarantine.

Regarding complaints of quarantine sites, the Department had been taken to court on only one matter. Generally, once it had procured a site, the DoH took over the operation of the facilities. There had been some complaints in Durban where they had procured one, two, three and four star hotels. In many instances, people who came from overseas, and did not want to stay at one star hotels. Then Members would ask the Department why it was not giving business to the one star hotels and the guest houses, but sometimes people did not want to stay there. In the case of Durban, the Department had procured a three star and four star hotel. To resolve that problem, the hotel owners had agreed to move the people from the three star to the four star hotel, and that was how that problem was resolved.

There was absolutely no shortage of quarantine sites -- there were more than enough. If anybody at the ports of entry claimed that they could not bring people back because of the lack of quarantine sites, that was not true, and she would like Members to send their information to her. Some of the small ports of entries had been closed. There were only 35 posts open and they were mostly the big ones. She would really like to assist the people from Mozambique that one of the Members had mentioned, because there was no shortage of quarantine sites. Where there might be a shortage because pf the spike, was hospital beds, but hospital beds were the responsibility of the DoH, and not the DPWI.

The Member who had said that the Department had initially budgeted R38 million was correct. At the time that the Minister was asked the question in Parliament, they had paid about R15 million, and she could tell the Committee out of the R375 million that they had set aside they had committed about R188 million. That target moved as they procured more sites. The list with the quarantine sites would be made available to all the Members the next day.

Minister De Lille said the Infrastructure Department was a reconfigured department of government and had been gazetted in August 2019, when they had started the process of creating it. The methodology that they had followed was to engage with all the provinces, the premiers, their MECs, the district mayors and the metro mayors to see what the status of all the infrastructure projects in the country was. They had then compiled a list of 176 projects that they had obtained from all government departments, and put them through a process to see which were bankable or implementable, and what stage were they at. The private sector had assisted them with a multi-disciplinary team, and of the 176 projects they had found that 55 of them were bankable, and could go into construction. They had taken these 55 projects and looked at which of them were commercially viable, and then took them to the commercial banks.

There was a second lot that required blended funding, where there would be private sector and public sector funding together. Those projects were sent to the Infrastructure Fund. The Infrastructure Fund had been created in 2018, but the decision of the President at the time was that the money should be kept at the Development Bank of Southern Africa (DBSA), which was why the money was not reflected in the Department’s books, so the blended projects were sent to the DBSA to fund them out of the Infrastructure Fund.The last group of projects were was mostly to do with social infrastructure. These projects had to be solely funded by the fiscus. The Department had then said to National Treasury that they had to allocate the funding to the DPWI and the state-owned enterprises (SOEs), and had to look at infrastructure grants to see how they could be funded. This had finally led to the infrastructure plan which the Department had presented to the Committee on 24 June.

The next step would be to gazette the 55 projects that were commercially viable, and to gazette the 16 projects which they called social projects. Once gazetted, the details of these projects would appear in the gazette, and she planned to have it ready by the end of the following week. Then it would be public knowledge and it would be shared with the Members of the Committee.

The establishment of Infrastructure South Africa (ISA) was a methodology that the Cabinet had approved, in that they needed to establish a structure where they could have a single database of all infrastructure in the country. They were in the process of putting together the ISA. The DBSA must first approve the structure, and once it had approved it, they could start recruiting people to come into the Infrastructure South Africa. The Minister would have to report on a quarterly basis to Cabinet about the progress that they were making with the infrastructure plan implementation, and she could do the same for the Portfolio Committee.

Because Covid-19 would be around for many years, the Department had designed the infrastructure plan around what they could implement immediately and what they could implement in the medium and long term. In terms of the social infrastructure, such as the rural bridges and roads that they wanted to build, and the urban management to clean towns and cities, this would be highly labour intensive. The Department had therefore consulted with the Minister of Labour and Employment in order to look at the databases of the Unemployment Insurance Fund (UIF) and the South African Revenue Service (SARS) of all the unemployed people. Infrastructure South Africa would be the administrative arm of rolling out the infrastructure plan. Those were the broad points that she wanted to make with regard to infrastructure.

Department’s response

Mr Vukela responded to the question on job creation by confirming that it was embedded in the programmes. There was already a presidential job protection and creation initiative which was managed through the Programme Management Office of the Presidency, and as departments they have been asked to make contributions to the employment stimulus. The DPWI would make the Members aware of the contributions that they made. The job creation element was also embedded in the infrastructure roll out that the Minister had spoken about.

Mr Mandla Sithole, CFO: DPWI, responded to the question about the targets of the Department. It had understated its under-spending in most of the programmes because of the lockdown in the first quarter. For example, with the compensation of employees (CoE), they had a programme to fill vacant positions, but in the second quarter had realised that they would not be spending that money. They had taken about R390 million from CoE. The impact on the programme was not too severe. Even for spending on goods and services, they had taken out about R92 million, as they were not travelling. That was the approach that they had taken across the programme. They were not aware how long Covid would last. In the future, it may affect the budget of the Department if they were expected to provide more quarantine sites. Fortunately, they were engaging with National Treasury on almost a weekly basis.

There was a big backlog in the maintenance budget, but the infrastructure budget would start to deal with those issues.  Regarding the question on IT infrastructure, it was not for provincial departments,  only for the national DPWI, including their regional offices.

Regarding the capacity of internal audit to look at the possible irregularities in procurement, he could confirm that there was a capacity within the Department. There was a programme with both internal audit and the Auditor General (AG) to audit the procurement activities for Covid 19. When they met the Auditor General (AG) the previous Thursday, it had been confirmed that the AG would provide them with a quarterly report on Covid 19 spending.

Mr Clive Mtshisa, Deputy Director General (DDG): Corporate Services, DPWI, commented on the Department’s approach to remote work away from the office, and said two critical interventions had been made. Devices had been made available to continue work, and the data required to ensure that people were able to log in. It was a national system that cut across all the regional offices in all nine provinces. All officials and employees across the Department were able to access this service. It had ensured that officials could work away from the office, especially during the first initial lockdown when everybody were compelled to work from home. At stage four, the Department had implemented a rotational policy where one third of staff at any given time could work from the office. The strategy was based on those two elements, and all activities that were taking place in respect of engagement purposes were taking place on online video platforms. They had introduced a system to send documents electronically, and submissions were now signed electronically away from the office.  

Mr Devan Pillay, Chief Director: Expanded Public Works Programme, DPWI, responded to the EPWP questions. In terms of the targets, there had been some challenges with the quarter one reporting, and this was understandable as the underreporting in this quarter had been because of the lockdown. In quarter one, they had just under 100 000 work opportunities reported, and they expected this figure to pick up as they moved to the second and third quarter. As an example, programmes such as the Community Work Programme (CWP) had spent a fairy large chunk of quarter one reprioritising their activities to respond to Covid 19 and the economic recovery plan that the DG had mentioned.

The Department’s EPWP branch was largely responsible for the coordination, reporting and monitoring of recruitment for the EPWP. Recruitment was actually done at the implementing body level -- that was the public body that was implementing the project. There was something like 350 public bodies implementing the EPWP. Participants would have been recruited at the point at which the projects started and those recruitments would come to an end at the end of a project. The participants who were part of a programme that was still being implemented would still operate, but if the project or programme had come to an end, there were new recruitments that took place.

The other issue that had been mentioned was the EPWP’s NPO 1:35:59 my recording) project for the Department of Health. This programme had initially started in April, and a large part of April and May had been spent on the recruitment of participants and the recruitment of NPO’s and engagements with the DoH. The Department had been ready to implement at the end of April, but there were delays from the DoH, as they still had to engage with their stakeholders and needed to identify where the demand was. The DoH engaged at the local level and provincial level and had begun implementing these programmes only as of 1 June. The programme would be run for three months. There were 189 NPO’s recruited to further recruit 25 000 participants nationwide. The majority of the NPOs were implementing, but there were still about 61 NPOs that need to implement. The main reason for the delay was that at local level the deployment had not yet taken place. In these areas, the municipalities and the provinces were working on the deployment.

Regarding the DBE initiative, there had been an initial request for the DPWI, through its NPO project, to assist it with the cleaning and sanitisation of schools. There had been extensive engagement at an administrative level with a number of departments that included the DBE, DPWI, Cooperative Governance and Traditional Affairs (Cogta) and National Treasury to fund this initiative. It had been agreed that the implementation of this programme should be by the provincial Departments of Education. It was also agreed that in order to assist with the funding of this initiative, the DBE, together with National Treasury, would reallocate a part of its infrastructure grant to supplement the cost for the 35 000 participants. However, at the initiation of this cleaning programme and during the lockdown, around 1 600 of schools had been vandalised, so the DBE had in the past few weeks been focusing on addressing the vandalised schools. The DBE was still engaging with provincial departments to establish how they could expand the cleaning programme up until 31 March 2021.

The cost factors related to Covid 19 had been excessive for the DBE. They had spent large amounts of money just procuring PPE both for cleaners and for schools. What they had realised in the last two weeks, that when the younger learners had been provided with PPE masks, the masks tended to get lost and needed to be replaced, so it had allocated 10% of its budget just to replenish PPE. This programme had caught everyone off guard in terms of the PPE cost factor, as well as the creation of these work opportunities. What was very clear at the DG level was that there was no additional funding for the programme, so funds that would be reprioritised later within existing budgets. Therefore, the R4.4 billion had been reallocated from the DBE infrastructure grant toward the Covid-19 response.

Referring to how the reduced budgets would impact job creation, Mr Pillay said that budgets had already been allocated to EPWP projects. Then Covid-19 had happened and the need for PPE had materialised, which was an exorbitant cost.  The EPWP, as part of their mandate, had begun engaging with provincial coordinating departments, as well as implementing departments, to look at how they could innovatively use those budgets to meet the EPWP targets and also expand their response to Covid 19 and the economic recovery. Just the previous day, they had had a webinar with 300 EPWP participants, drawing on international best practice and looking at the reprioritisation of budgets and at different programmes that could be implemented. This was part of the learning curve that they were going through as the EPWP.

In summary, they still intended to achieve their targets, and they intend to serve this as a response to the increased unemployment, and moving forward they would be able to gear themselves towards this initiative.

The Minister mentioned that the office of the AG had asked for a meeting with the Department on 17 July, where they would be discussing the Covid-19 control measures which they could implement.

Follow-up questions

Ms Siwisa said the Committee had had a presentation on the National Infrastructure Plan a few weeks ago, as well as one the existence of the IDT. She said that if the IDT was going, who would take over what the IDT was doing? They had now had a presentation on the national infrastructure, and again it had raised some questions. The Committee had heard about the DBSA and the role it was going to play in the infrastructure. How would the Department do oversight over the DBSA, as it was not a state owned entity and it was on its own. In the past some of the tasks and projects that were meant to be done by the IDT had been given to COGTA or the DBSA. They had never received any complaints that those two had problems in collecting funds from the client departments, but they always had problems with the IDT getting their procurement funds from sister departments.

Where was the logic? There was the Department, and there was the DBSA -- what oversight role would the Department have over the DBSA, and what was the Committee’s role?

What was the organogram when it came to bringing infrastructure into the DPWI, because every time there was new information it was as if the information was coming in bits -- they never got the whole package? It always depended on the platform and the question asked, as voluntary answers were never given.

She also expressed concern over the number of quarantine sites, where 568 had been identified, while only 409 had been approved and only 139 had been activated. The Eastern Cape’s andWestern Cape’s numbers were going up, and they had only 19 activated sites. What was the communication between the DPWI and the DoH?

When people volunteered to make their places available as quarantine sites, were they being put in the budget, or were they coming with their own budget? She was speaking about those who approached the Department and told them that they had a lodge or a B&B that the Department could utilise. What criteria were used to determine which places were suitable?

When one quarantined a person, that person should be alone in a room, but that was not the case. Information was coming in bits and pieces. Could all the outstanding information please be forwarded to the Committee so it could know where the 596 sites were? Where were the sites that had been approved? Where were the sites that were being activated?

Mr Brauteseth said that he had sent a written question to the Minister on 6 June, and asked if she could answer it now or undertake to give him an answer. The Minister and the DG would remember the unfortunate event in Durban, where they had a hotel called the Hotel Coastland Apartments. A number of repatriates had been put there, but the conditions had not been up to standard. Thankfully, through the efforts of various Members of Parliament, including himself and of course the Department of Public Works, the repatriates had been moved to a hotel of much better quality. He asked how much had been spent with the Coastland Hotel and Resorts Group since the start of the lockdown until now. What services had been provided in return for this expenditure? What funds had been budgeted for services at the Coastlands Hotel and Resorts Group from now until 31 December 2020, or until the period of lockdown ends? What services had been budget for? If they could not answer it at the meeting, could they please undertake to provide him with a response to that question which had been sent over a month ago.

Ms Hicklin said that with the repatriation of South Africans to South Africa, whether they came over land or via sea or flight, quarantine was non-negotiable according to the DoH. She did not understand why there had been a low uptake with the number of beds used in quarantine, because it was mandatory when people came into the country. She understood that isolation was something different. She wanted clarity on what the Minister meant when she said there had been low uptake?

She also requested that they receive an organogram of the new DPWI in order to understand what skills were needed, and where people fitted into the various options that had been discussed.

Ms Graham expressed concerned that the Minister had referred to the fact that the DBSA needed to approve the structure of the ISA, as an entity that would require oversight would then get to determine who would do the oversight and what that structure would look like.

Her question about the additional R590 million had not been addressed. She wanted clarity as to why there were two allocations by the National Treasury on land ports of entry and quarantine sites. There was the R4 billion and then the R597 million. Mr Pillay had not mentioned whether or not the non-state sector EPWP would be financed through the IDT, or run through the IDT. He had not actually stipulated as to which entity would be in charge of the EPWP. He had also mentioned the deployment by municipalities for these programmes, and she did not understand why the municipalities were involved in the non-state EPWP sector. The IDT had still not implemented some of the non-state sector EPWP projects for this year that ordinarily went through NPOs. There were currently NPOs that were not operational in terms of the ordinary IDT programmes. Could that be followed up on?

She was concerned that the DBE was channelling funds from infrastructure into this EPWP project. It did not help to go and get a team to clean and sanitise a school, and then have the children arrive at the school and not have water to wash their hands or working toilets, or did not have walls or ceilings or floors in their schools. She knew that this was not under their mandate, but as they were in charge of infrastructure, it was deeply concerning that they were drawing money out of an infrastructure fund to be used for cleaning. She requested clarity as to whether the money from the DBE infrastructure fund was for the PPE and cleaning material, and that the R771 million was what the Department was paying for the EPWP participants.

Chairperson Ntobongwana appreciated the responses that had been given. The Committee needed to report their findings to the National Assembly in order for this information to be made public knowledge. Their oversight did not stop there. They had to keep an eye on the funds that the Department had shifted and the targets to ensure that things were done in accordance with what they had said. This was the second time the Committee had requested clarity on the infrastructure projects. Could the Department send the Committee a list of the 176 and 155 infrastructure projects, indicating the stage they were at, and in which province and region they were, by the end of the month. The Committee also wanted clarity as to where the money was coming from -- who the partners who were funding the infrastructure in South Africa were. What money was with the DBSA?

Minister’s response

Minister De Lille said that implementing agencies had been in South Africa for many years. In the case of DBSA, it had been established before 1990, and they had a board to which the administration was accountable. The government had used implementation agencies to implement many government infrastructure projects for many years. What she was working on was the lack of monitoring arrangements within existing contracts with implementing agencies. These needed to be based on the AG’s advice, which stated that any government department which appointed an implementing agency should make sure that the contractual obligations, such as delivering on time, no overruns, and that on a monthly basis the money was accounted for, should be included in the new terms. The Minster had written to the DBSA and COGTA and asked them for a list of all the government projects from all the departments which related to infrastructure that they were currently busy with. They had sent her those lists, and she had pointed out to DBSA that they had their own founding documents and were both a lending and an implementing institution, but she wanted to talk to them about all their projects for the government and where they were.  She had sent the list to the chairperson of the DBSA board, and they were now working on a structure on how they would monitor the implementation of all government-related infrastructure with DBSA in term of the new guidelines from the AG. On 23 June she had signed a memorandum of agreement (MOU) with the DBSA chairperson as to how the DPWI would monitor the spending of the R100 billion which was with the DBSA. DBSA would also not decide how they would spend that money, but would be guided by the infrastructure plan of government for this administration, and they would advise them when there was a need to get some money from that fund. That requirement had not been there in the past. The Department was busy establishing it now with all the implementation agencies.

Minister De Lille said she had also written to COGTA and said that she wanted to see all their projects, so there would now be a single entry point for all of the infrastructure in the whole of the country. The Department wanted to put all the progress on the database. She had requested that the implementing agencies first complete their outstanding projects before they started talking about allocating new projects to them. That was the situation with all of the implementing agencies. She had to mention that there was a lot of technical capacity within these agencies which they had built up over the years, but the DBSA had a good social facilitation methodology with how they interacted with the communities. There was no need to throw out the baby with the bathwater -- they needed to use these agencies.

Everyone was aware of the number of Covid-19 cases increasing every day. The case load was currently increasing at the rate of 10 000 a day. The DoH’s regulations clearly defined the roles and responsibilities for each department. For the DPWI, the regulations clearly state that it must identify and make available quarantine sites. When one looks at the regulations, it was the DoH that needed to decide whether a site was usable or not. It had prescribed the criteria that must be used to make a site compliant.

With regard to the Member who had sent the question on 12 June, there was a procedure by which the Minister must take ten workings days to answer a question. However, when the Minster wanted to give Members information, she needed to obtain and verify the information with the administration. The reason the question had not been answered was because she was still waiting for information from the administration. She had in front of her the amounts that had been paid to this service provider which had been used as a quarantine site, but she needs some further information to answer the question fully. She would even follow up with the administration that evening in order to fully answer Mr Brauteseth.

The issue of low uptake at quarantine sites was the responsibility of each province. They had to do the contact tracing and identify the number of people that needed to use the quarantine facilities, and take them to the facilities. As she had said, the provinces needed to go on an education campaign to explain to people why it was important to go into quarantine. That was not the role of the Department of Public Works. It was the role of the DoH, or the provinces and the MECs and their premiers, to make sure that people went to the quarantine sites.

Most of their budget that they have spent on quarantine had gone towards repatriation. They had spent little on local quarantine facilities for local people, because there was this reluctance for people to go there. This was definitely something that should be addressed.

Regarding the organogram of the Department, they needed to look at the Public Service Act which described how one would create any new structure. They could not just decide. That was why she had said that the DPWI would have to engage with the DBSA in order to establish the new structure in accordance with the prescribed regulations in the Act. The DBSA had nothing to do with ISA. ISA had to be established in terms of the Public Service Act.

The Department had promised the Committee a report about the state of matters at the IDT. The task team had met two days ago, and she and the Deputy Minister had met with the task team last Sunday, so that was work in progress. The Department would answer the question on the DBE and the PPE. She agreed with the Chairperson that the Committee had to keep an eye on the funds. The list would be presented next week.

In terms of the Infrastructure Development Act, if they gazetted a project in terms of the Act, that project then qualified for the procurement and implement processes in schedule two of the Act. The Minister had had two meetings with the board of DBSA, and they were designing a monitoring system whereby the Department could have oversight over government projects that the DBSA was implementing. 

Mr Sithole said that the question around the R595 million and R4 billion was difficult to respond to, as it was information of the National Treasury. The Department had made an application to National Treasury and requested an additional amount which had not been approved. They had approved only the reprioritisation of their own budget. Treasury had approved the reprioritisation of R1.6 billion, a breakdown of which had been given in the presentation.

Chairperson’s conclusion

The Chairperson summarised that R1.6 billion had been reprioritised in response to Covid-19. The message was that in essence there had been no net movement. They had heard the role that other entities of the Department would play to ensure that there was job creation. The Department had to ensure that the 45 000 EPWP workers were on the ground to implement the hygiene strategy, make sure systems were in place to detect any deviation that could be tantamount to fraudulent activities. In partnership with the AG, there was work in progress to ensure that there was clean governance.

The Chairperson hoped that the Minister and the DG had taken note of the questions around the “new baby” of the Department. It was a fully fleshed baby that had been transferred from the Department of Economic Development that needs to be absorbed by the DPWI. It was a work in progress, and the Committee would continue to be briefed on the implement of the infrastructure programme, which was critical for transforming the economy.

The Chairperson extended appreciation to the Minister, the DG and the team and the manner in which the Members had engaged with the presentation.

The meeting was adjourned.


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