The purpose of this virtual meeting was for the Ad Hoc Committee to receive a briefing on the key issues of the section 100 intervention in North West province, and consideration of the Committee Report on the intervention. It had only seven weeks to accomplish this task, so it was important for Members to familiarise themselves with the issues involved.
The Committee Content Advisor said that following the Cabinet’s decision in December 2020 to withdraw the intervention, it was important that the Committee assess the progress already made and the impact the intervention had on the lives of people in the North West province. Members had to agree on a plan on how the Committee would implement its mandate of assessing the progress and the impact of the intervention.
The objectives of this Committee were to ensure that all funds lost to financial misconduct, corruption and irregular payments were recovered, and that consequence management was implemented. It had to ensure that the 49 cases escalated to the Hawks and the 44 cases escalated to the Special Investigating Unit (SIU) were finalised, and that the implicated officials were charged. All the critical vacant posts and the 2 198 advertised posts had to be filled without delay to address the capacity challenges of the province.
Discussions between the North West Department of Health, the National Department of Health, the Provincial Treasury and the National Treasury to address the provincial budget shortages had been concluded, which would assist in resolving the issue of staff and equipment shortages, especially at the Mahikeng Provincial Hospital. The Committee also had to ensure that the investigation into the poor performance of supply chain management (SCM) structures was completed, and that the backlog of unpaid invoices was addressed. The Committee was expected to report to the National Assembly at the end of March 2021,
Members expressed concern over the short period available to draft and table its final oversight report to the National Assembly. If there was still outstanding work to do by the time the deadline had arrived, the Committee could make an appropriate recommendation to the National Assembly to provide time and resources for it to finalise and conclude its work. Following Cabinet’s December decision to withdraw the intervention, it was important for Parliament to assess the progress already made and the impact of the intervention on the lives of the people of the province.
The Chairperson said the purpose of the meeting was for the Committee to receive a briefing from the Content Advisor on the key issues of the section 100 intervention in North West province, and consideration of the Committee Report on the intervention. The Committee had only seven weeks to accomplish this task, so it was important for Members to familiarise themselves with the issues involved, including where it had originated, what issues were in play, and the occurrences that had led up to the establishment and operationalisation of this Committee. It was the duty of the Committee to submit clear and effective recommendations to the National Assembly.
Following the Cabinet’s decision in December 2020 to withdraw the intervention, it was important that the Committee assessed the progress already made and the impact the intervention had had on the lives of people in the North West province. Members had to agree on a plan on how the Committee would implement its mandate of assessing the progress and the impact of the section 100 intervention.
Briefing by Content Advisor
Mr Phelelani Dlomo, Committee Content Advisor, referred Members to three important documents that they should be familiar with going forward. First, the baseline document for the intervention in North West set out the provincial assessment, the diagnostic report, and the proposed interventions by the National Executive after the Inter-Ministerial Task Team (IMTT) was appointed. Secondly, the oversight report by the previous Ad Hoc Committee from 2018 set out critical findings and recommendations. Thirdly, there was the legacy report of the previous Ad Hoc Committee that dealt with some outstanding issues when the oversight report was compiled. A lot had happened since 2018. However, it was important for Members to study these reports to get an understanding of what had happened leading up to the intervention, and the work that had been done.
Background and mandate of the NCOP
Section 42(4) of the Constitution stated that the National Council of Provinces (the NCOP) represented the provinces and ensured that provincial interests were considered in the national sphere of government. The constitutional role of the NCOP was to provide an effective bridge between the provinces and the national sphere of government, and to contribute to the cooperative and effective government of South Africa.
Constitutional framework for intervention by national government
Section 100 of the Constitution stated that national intervention in a provincial administration may take place when a province could not, or did not, fulfil its executive obligations in terms of the Constitution or legislation.
The National Executive may, in terms of section 100(1)(a), issue directives to the Provincial Executive describing the extent to which it had failed to fulfil its obligations and prescribe the steps that the Provincial Executive must take to meet its obligations. The second aspect of the intervention, in terms of section 100(1)(b), provides for the National Executive to assume responsibility for the relevant provincial obligation to the extent that was necessary to maintain essential national standards for rendering a service, maintain economic unity, maintain national security, and to prevent the province from taking unreasonable action that was prejudicial to the interests of other provinces, or South Africa as a whole.
In the North West province, there were five departments that were under section 100(1)(a) intervention (with directives issued), and five departments were under section 100(1)(b) intervention (where administrators had been appointed).
National Executive intervention in North West:
Because of several governance challenges that were observed in the North West province, the Cabinet had invoked section 100(1) of the Constitution during 2018. The IMTT had been appointed to conduct performance assessments in the province, and ten departments were the subject of intervention. The ten departments subject to intervention were:
the Department of Finance, Economy, and Enterprise Development (the Provincial Treasury);
the Department of Local Government and Human Settlements;
the Department of Rural, Environment, and Agricultural Development;
the Department of Social Development;
the Department of Tourism;
the Office of the Premier;
the Department of Community Safety and Transport Management;
the Department of Basic Education and Sports Development;
the Department of Health; and
the Department of Public Works and Roads.
In 2018, the IMTT made several key findings and proposed interventions for each of these departments.
(See attached presentation for details).
Issues and proposals raised by stakeholders:
Stakeholders were consulted by the IMTT and several issues were raised, and proposals were made in response. Issues included the insufficient and ineffective governance and political oversight, widespread corruption, appointment of incompetent officials in critical vacancies, a lack of service delivery as a result of the flawed implementation of the provincial and municipal budgets, a lack of consequence management and investigations into reported fraudulent practices, dysfunctional municipalities, the lack of support for youth, and the high rates of unemployment.
Stakeholders proposed placing the province under administration to stabilise governance and restore normality, to realign the provincial government with the national spheres of government. Proposals were also made in favour of comprehensive investigations into corruption across all levels of government within the North West, the appointment of competent and ethical accounting officers, and the filling of critical vacancies. The launch of an outreach programme to keep communities abreast of progress made in restoring services and a continued sense of collaboration with local stakeholders to address specific service delivery challenges, was also proposed.
All provincial departments participated in the drafting of intervention plans together with national departments and government, which was supportive of the IMTT’s activities in the province.
Diagnostic analyses by the government and its entities:
National Treasury conducted a diagnostic analysis on the North West province, which focused on provincial expenditure trends, compliance with laws and regulations, and key issues in the departments.
Subsequently, the Auditor-General of South Africa (the AGSA) conducted an analysis that focused on the overall provincial audit outcomes, and the section 100(1)(b) audit outcomes of the North West province, the key projects observations, and also focused on the root causes of failures and key considerations for strengthening accountability. The AGSA reported that the root causes for the lack of accountability included that:
management did not respond with the required urgency to ensure the improvement in audit outcomes;
the political leadership and oversight bodies demonstrated limited political will to ensure accountability and consequence management;
instability and prolonged vacancies in key positions had an impact on the rate of improvement in audit outcomes; that controls that enable reliable and timeous financial and performance reporting were not institutionalised;
coordinating departments and role players did not adequately support other departments and entities; and
the provincial executive leadership did not set an example of accountability.
AGSA recommendations were that the provincial leadership should take responsibility for creating a culture in which accountability could be restored and strengthened. The provincial leadership and oversight structures should develop a comprehensive assurance model, inclusive of strong and effective governance structures, to enable all key role players to adequately perform their monitoring duties as well as ensuring that the administrative leadership was held accountable for commitments with regard to improved financial and performance reporting disciplines. The provincial leadership should take accountability by enabling the audit environment not to be hostile, a reduction in the contestations of audit findings, as well as pushbacks in the absence of evidence, and subtle threats against staff.
The Constitution provided for a developmental role for local government, at the forefront of participatory democracy, responsive to citizens’ priorities, with employees who were skilled, competent, and committed to delivering quality services, operating within a supportive and empowering intergovernmental system. The National Development Plan (NDP) cautioned that the capacity to fulfil this role had to be consciously built and sustained. Municipalities operate in a challenging and complex environment, with citizens demanding quality services, value for money and social justice. Each municipality was also unique in terms of its socio-economic, cultural, and political environment. The inter-governmental system needed to be managed proactively to address specific weaknesses in coordination, as well as to provide differentiated support to address the specific needs of individual municipalities and departments.
Observations of previous Ad Hoc Committee
A major concern for the previous Ad Hoc Committee had been the submission by the IMTT indicating that supply chain management (SCM) and control management processes had been weakened and, in some cases, had collapsed. The previous Committee welcomed the action steps and timeframes of the intervention from the IMTT, where the key was the need to speedily regularise services in the province. It was noted that a lack of capacity and skills had exacerbated the extent of the governance and service delivery challenges in the North West provincial government. A key concern was the current fiscal environment, in which the prevailing fiscal constraints implied that funds had to be protected against any governance breaches in the system.
The previous Ad Hoc Committee had pointed out that a clear implementation plan and recovery plan was critical for a successful intervention. It had been most concerned with the poor outcomes in governance, notwithstanding the existence of governance structures such as internal audit and audit committees. It had raised concerns around the role of project management units, the level of skills and capacity in the various departments, and the role and effectiveness of Accounting Officers.
Another major concern for the previous Ad Hoc Committee was that the submission by the North West provincial government had not responded directly and in detail to the specific issues raised by the IMTT. The Committee had viewed the province’s overall regression in audit outcomes in a serious light. It was of the view -- and emphatic -- that unauthorised, irregular, fruitless and wasteful expenditure was of serious concern to Parliament, and was not to be taken lightly. It had called on the North West province to adequately respond and act in all instances wherein irregular, fruitless and wasteful expenditure was detected. It pointed out that good governance, including adherence and compliance with due process and legislation, was non-negotiable.
A number of concerning cross-cutting issues noted by the Committee included:
the state and health of the political and administration interface;
the alleged interference of the political leadership in the recruitment process of administration posts;
undue politicising of government programmes;
clarity on the role, responsibilities and accountability mechanisms for Accounting Officers/Heads of Departments (HODs) and Chief Financial Officers (CFOs);
the status and costs of litigation in the province; and
the efficacy of the provincial government.
Another key concern was the role and efficacy of provincial oversight structures. The previous Ad Hoc Committee noted the lack of follow-up on accountability failures at executive level and the monitoring of audit action plans for each department. It had pointed out that provincial oversight structures, including the legislatures, needed to take appropriate action to ensure that irregular expenditure was thoroughly investigated and that there was consequence management. The role of the Office of Premier in enforcing ethical values in the provincial administration was viewed as critical. The Committee also noted the North West’s submission that there had been challenges in entrenching the Batho Pele ethos in the province, though it welcomed the province’s submission that there had been positive collaboration between the province and the Department of Planning, Monitoring and Evaluation (DPME) in efforts to improve service delivery.
Key issues identified were the need to emphasise the critical role of Accounting Officers in ensuring the annual performance plans (APPs) were aligned to the NDP and that funds were directed solely to the attainment of the targets and improvements in service delivery. The Premier’s submission that the province had expressed committed to mobilising resources in order to address the root causes of regression in audit outcomes and the strengthening of good governance principles of integrity, shared values and ethics, was welcomed.
Outline of objectives for the Sixth Parliament
Mr Dlomo read from the oversight report of the previous Ad Hoc Committee, which had been drafted on 31 October 2018. He stated that the Sixth Parliament -- and by extension, this Committee -- had to ensure that all funds lost due to financial misconduct, corruption or irregular payments were recovered, and that consequence management was implemented. It had to ensure that the 49 cases escalated to the Hawks and the 44 cases escalated to the Special Investigating Unit (SIU) were finalised and that the implicated officials were charged. Furthermore, all the critical vacant posts and the 2 198 advertised posts had to be filled without delay, to address the capacity challenges of the North West province.
The discussions between the North West Department of Health, the National Department of Health, the Provincial Treasury and the National Treasury, to address the provincial budget shortages had been concluded. This would assist in resolving the issue of staff and equipment shortage, especially in the Mahikeng Provincial Hospital. The Committee must ensure that the investigation into the poor performance of SCM structures was completed, and that the backlog of unpaid invoices were addressed.
Overview of Committee’s programme
The Chairperson presented the proposed programme for the Committee going forward. It was expected to report to the National Assembly by the end of March 2021, after which the seven-week lifespan of the Committee would come to an end. Key institutions that had to be engaged, especially in terms of the legacy report, had been identified to follow-up on all the issues identified by the previous Ad Hoc Committee on the intervention in the North West Province. Over the next two weeks, the Committee would engage with the IMTT, National Treasury, the AGSA, the SIU, the National Prosecuting Authority (NPA) and the Hawks.
It would be useful to obtain the financial reports from the different departments, and National Treasury would be key in this regard to provide the Committee with an updated report on the state of the municipalities’ finances. The AGSA must be engaged to determine whether there had been any improvement since the intervention. Because there were a lot of security issues involved that bordered on the need for criminal investigation, the SIU, the NPA and the Hawks must be brought before the Committee as well. These security entities would be required to furnish the Committee with details on the little progress made in criminal cases that had been opened to enforce consequent management.
The Committee would conduct its oversight visit to the North West province from 1 to 5 March. It would then meet to draft and table the Committee oversight report and discuss whether it adequately addressed the issues in play regarding the section 100 intervention. After this, it would meet to adopt the oversight report before tabling it in Parliament.
The Chairperson thanked the Content Advisor for the briefing, and said it was the duty of the Committee to ensure that oversight was exercised in relation to the issues that had been raised. The goal of the entire process was to ensure that there was stability and adequate governance in the North West.
Mr S Zandamela (EFF, Mpumalanga) asked whether the Committee could be furnished with detailed information on the investigations and criminal cases being handled by the SIU and the Hawks as they pertained to the section 100 intervention in the North West. He was not sure whether the Committee would have enough time to table the oversight report after it had been adopted, as the programme allowed for only five days to complete this task. The Committee must also follow-up on the oversight visit to the North West, to ensure it was in adherence with lockdown regulations. He also suggested following the approach of the previous Ad Hoc Committee in splitting Members up into two teams to ensure that sufficient ground was covered, and that the Committee had all the required information to draft the report.
Ms C Visser (DA, North West) said the first part of the report did not speak to what was really happening on the ground in the North West. Working closely with the Premier, HODs and Members of the Executive Council (MECs), she had not really seen any improvement in the last six months in the North West. She pleaded that the Committee had to take its time to fulfil its oversight role in order to deliver a meaningful report that would bring about real change in the North West. The Committee could not afford to slip up on this issue, and meaningful recommendations must be made to the National Assembly when the Committee tabled its oversight report.
Mr S du Toit (FF+, North West) requested that the Committee look at each department’s composition that was in place during the fifth Parliament, and then compare it to the current composition of those departments. This would shed light on officials that had been re-elected or re-employed, to determine who had been part of the misconduct involved in the North West. He asked when Easter weekend was this year, as it was important that the Committee’s oversight visit was not conducted on a religious holiday.
Ms M Gillion (ANC, Western Cape) appreciated receiving the information and briefings well ahead of schedule so that the Committee could study them properly. She was disturbed by Ms Visser’s remark that she was ‘on the ground in the North West’. She pleaded with Members not to make assumptions or foster feelings regarding the matter before the Committee did its work and conducted the oversight visit. Producing a meaningful report would be to the benefit of all the people in the North West.
The Chairperson responded to Mr Du Toit, and stated that Easter weekend was only on 1 April, and not in the month of March, so it would not affect the oversight visit of the Committee.
Mr I Sileku (DA, Western Cape) raised a concern that the Committee would be afforded only one opportunity to engage with the stakeholders regarding the section 100 intervention in the North West. He agreed with Mr Zandamela on the issue of being sure whether the Committee would have enough time to table the oversight report after it had been adopted, as the programme allowed for only five days to complete this task. This issue would influence whether the Committee was able to provide proper recommendations that would truly assist the residents of the North West. The Committee could not merely be a rubberstamp going through the processes until the seven-week lifespan of the Committee had passed. He had noticed a norm developing when dealing with section 100 interventions, where the Committee’s recommendations were not taken seriously.
Mr D Ryder (DA, Gauteng) said it would be useful for the Committee to have the resolutions taken by the NCOP about 18 months ago so that Members could have a point of reference guiding the work that must still be done. He asked for the Committee’s programme to be circulated to the Members for comment. Responding to Ms Gillion, he said that Ms Visser’s comments were not unfounded.
Ms Z Ncitha (ANC, Eastern Cape) asked what the previous Ad Hoc Committee had stated in its final report regarding the challenge of skill audits and the rationalisation of the involved government entities.
Mr Y Carrim (ANC, KwaZulu-Natal) agreed that the process of the Committee should not be rushed. However, Members should remember that the work of the Committee followed on the work done by the previous Ad Hoc Committee, so they were not starting from square one on this issue. It was building on the work of its predecessor and the briefings received from the relevant Ministers in the NCOP in 2020.
The Chairperson drew Members’ attention to the fact that this Committee had been established only in December 2020. It had been made clear what its composition would be and how long it would be in operation. It was expected to table its oversight report by 26 March. It had to bring a long-term sustainable solution to the problems of the North West province to avoid a future recurrence of the issues that had been discussed. The Committee must adhere to the resolution of the National Assembly regarding the timeline for its work. If there was still outstanding work to do by the time the deadline had arrived, the Committee could make an appropriate recommendation to the National Assembly to provide time and resources for it to finalise and conclude its work.
Content Advisor’s response
Mr Dlomo thanked Members for their questions and concerns, and said his colleagues from the Parliamentary Legal Services would assist the Committee regarding the precedents of other section 100 interventions into provinces. Clear guidelines and parameters were not firmly set to determine whether a province should be subject to intervention as outlined in section 100 of the Constitution, which was somewhat supplemented by various modalities. The Committee had the opportunity to reaffirm the recommendations made by other Parliamentary Committees that had been put in place to oversee previous interventions. Members could say that, as Parliament, it became difficult to oversee an intervention when there were not clear mechanisms in place to regulate the approach taken, or to regulate the implementation of its recommendations. Parameters should be put in place to ensure that the intervention was sustainable. This should be adopted in a way that ensured sustainability, even if key officials left with their institutional memory, and to ensure that officials who were part of the problem were not reinstated or reemployed.
He said that the legacy report captured the progress for each department, and what issues still had to be dealt with. He agreed with Mr Zandamela’s proposal that the Committee follow the approach of the previous Ad Hoc Committee in splitting Members up into two teams to ensure that sufficient ground was covered, so that it had all the required information to draft its report. He suggested that the Committee reserve a day during its oversight visit to engage with stakeholders and the community.
Chairperson’s closing remarks
The Chairperson said that Members must look at this issue from the perspective of the national government, and not from their own political party’s viewpoints. The question was whether the issues that were in play when Cabinet invoked section 100 had been resolved or not. That was what the Committee had to establish, and make relevant recommendations in this regard. The Committee must adhere to the resolution of the National Assembly regarding the timeline for its work. If there was still outstanding work to do by the time the deadline had arrived, it could make an appropriate recommendation to the National Assembly to provide time and resources for it to finalise and conclude its work. He agreed with Mr Carrim that Members should remember that its work followed on that done by the previous Ad Hoc Committee, and thus they were not starting from square one on this issue. The proposed programme for the Committee would be circulated for comment.
Members would have the opportunity to engage with the Cabinet and the IMTT on why the section 100 intervention had been terminated late in December 2020. Some of the pertinent matters that the next meetings of the Committee would entail was a focus on the briefings from the Chairperson of the IMTT on the progress and impact of the intervention into the affairs of the province, the National Treasury and the AGSA regarding the financial management within the provincial government, as well as the briefing by the SIU, the NPA and the Hawks on progress in prosecuting the identified alleged wrongdoers in the collapse of the provincial departments that were under administration.
Following Cabinet’s decision of December 2020 to withdraw the intervention, it was important for Parliament to assess the progress already made and the impact of the intervention on the lives of the people of the province. The central pillar of the Committee’s work was to oversee that the intervention had borne the necessary fruits for the benefit of the people of the North West. In discharging this mandate, the Committee must look at the matter holistically to determine if adequate consequence management had been applied against the wrongdoers involved.
The meeting was adjourned.
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