At a virtual meeting, the Committee was briefed by the Department of Military Veterans (DMV) on matters arising from previous engagements. These pertained to investigations into irregular expenditure, the cleansing of the National Military Veterans Database, and complaints management by the DMV.
The Committee was also briefed by the National Conventional Arms Control Committee (NCACC) on its Annual Report, and its third and fourth quarterly reports for the 2020/21 financial year.
The Committee also decided to seek further responses from the Minister of Defence and Military Veterans to allegations of irregularities made against her in letters received by the Committee.
The DMV informed the Committee of the current status of cases arising from investigations into irregularities involving officials, including irregular expenditure. It was reported that the Department of Planning, Monitoring and Evaluation (DPME) received 109 files pertaining to the financial years between 2013/14 and 2018/19. It assessed whether the transgressions listed met the criteria for irregular expenditure. Assessment included identification of root causes of the transgressions; quantification of losses; identification of responsible officials; internal control deficiencies and recommendations for the DMV.
The DMV reported that there were allegations of fraud in the provision of accommodation and textbooks for Education Support; in the provision of food parcels for military veterans; and alleged wastage in the provision of cell phones to the DMV’s staff and stakeholders.
The Committee was also provided with an overview of the progress in cleaning the National Military Veterans Database. The DMV said it was committed to ensuring the completeness of the files relating to the database.
The Committee was briefed on the DMV’s system for handling complaints logged on the Presidential Hotline. Members were told there were plans to overhaul the system to make it more efficient.
The Committee received a report on irregular expenditure at the DMV for the financial years from 2013/14 to 2018/19. Concerns were expressed that there was a lack of will by the DMV’s Accounting Officer and Senior Management to implement consequence management within the institution. This led to a culture of impunity and disregard of the Public Finance Management Act as well as the regulations of National Treasury. The Committee welcomed the establishment of a Financial Management Committee intended to speedily deal with cases of irregular, fruitless and wasteful expenditure. Nonetheless, the Committee expressed concern that a lack of capacity within the DMV would hamper the work of the Financial Management Committee and delay investigations into allegations of fraud.
The Committee also welcomed the progress in cleaning the Military Veterans Database, a recommendation made by successive defence committees. However, the Committee remained concerned that the process had not been concluded.
The NCACC briefed the Committee on the statistics for controlled items, exports, imports and conveyances for the third and fourth quarters of the 2020/21 financial year.
In the third quarter the NCACC authorised contracts worth R2.97 billion with 28 countries. It authorised 170 export permits to the value of R740.22 million involving 37 countries, as well 73 import permits to the value of R163.76 million involving 19 countries. In addition, 17 authorisations were issued to 13 countries for the exporting of dual-use goods and technologies to the value of R 50.89 million.
In the fourth quarter, the NCACC authorised contracts worth R8.97 billion with 26 countries. It authorised 160 export permits to the value of R 3.11 billion involving 40 countries, as well as 113 import permits were to the value of R87.51 million involving 24 countries, In addition, 45 authorisations were issued to 12 countries for the exporting of dual-use goods and technologies to the value of R66.46 million.
Members welcomed the assurance that South Africa continued to comply with international commitments on arms control. There was a need for a balance between international obligations, addressing proliferation concerns, preserving jobs within the arms industry and ensuring compliance with legislation. The Committee noted the impact of the COVID-19 pandemic on the defence industry and hoped that the lowering of restrictions would aid the rejuvenation of the industry.
The Committee considered what action to take on letters it had received from a Member, General Bantu Holomisa. The letters concerned allegations of irregularities levelled against the Minister of Defence and Military Veterans. Following a response from the Minister to the allegations, the Committee resolved to elicit further detailed information from the Minister to enable the Committee to decide on the appropriate course of action.
Co-Chairperson Xaba convened the virtual meeting and welcomed Members, and the delegations from the Ministry of Justice and Correctional Services and the Department of Military Veterans (DMV). He noted the apology from Ms T Legwase (ANC) who could not attend the meeting. The purpose of the meeting was for the Committee to be briefed by the DMV on matters arising from previous meetings and engagements pertaining to cases detected in fraud investigations into irregular expenditure, the cleansing of the National Military Veterans Database, and the complaint management of the entity. The second item on the agenda was for the Committee to be briefed by the National Conventional Arms Control Committee (NCACC) on its Annual Reports, and its third and fourth quarterly reports for the 2020/21 financial year. The last item on the agenda was for the Committee to consider and adopt its outstanding minutes of previous meetings.
The delegation from the DMW consisted of Lt Gen DM Mgwebi, Acting Director-General; Mr Sibongiseni Ndlovu, Chief Financial Officer (CFO); Ms Nontobeko Mafu, Deputy Director-General, Empowerment and Stakeholder Management; Ms Sandisa Siyengo, Chief Director, Research and Policy Development; Mr Kobedi Matsafu, Chief Director, Beneficiary Support Services; Ms Phumeza Dzuguda Director, Communication and Events; and Ms Onicca Masekoameng, Director, Information Technology. Mr Ronald Lamola, Minister of Justice and Correctional Services, was also in attendance.
Briefing by the DMV on matters arising
The first item on the agenda was for the Committee to be briefed by the DMV on matters arising from previous meetings and engagements. These pertained to cases detected in Fraud investigations into irregular expenditure; the cleansing of the National Military Veterans Database; and complaint management. Lt Gen DM Mgwebi, Acting Director-General, DMV, presented the briefing.
Cases detected in fraud investigations
The purpose of this briefing was to inform the Committee on the current status of cases detected during investigations into irregularities involving officials, including irregular expenditure.
The Committee was told that the DMV approached the Department of Planning, Monitoring and Evaluation (DPME) for assistance in addressing a number of administrative challenges that were plaguing it. The assistance was confined to specific areas, which included management of unauthorised, irregular, fruitless and wasteful expenditure, and the reconciliation of the DMV’s assets register. The DMV had attempted to investigate the cases through the internal Financial Misconduct Panel, but the process was stopped due to internal interferences and conflict of interest among the panel members. There were challenges relating to human resources capacity and skills.
Subsequent to the request for assistance and further engagements between the two departments, the DPME enlisted the expertise of National Treasury as the policy custodian of the Public Finance Management Act (PMFA). The project became a collaborative effort with the DPME and National Treasury playing an expert and supporting role. The project team was provided with the files identified by DMV to conduct determinations of irregular, fruitless and wasteful expenditure. The DPME received 109 files pertaining to the financial years between 2013/14 and 2018/19. The determinations assessed whether the transgressions listed in the lead schedule met the criteria of irregular expenditure. Assessment of the cases was based on the information provided by the DMV, and included identification of root causes of the transgressions; quantification of losses; identification of responsible officials; internal control deficiencies; and recommendations for the DMV. The DPME handed a report to the DMV that contained detailed information for the 109 cases assessed. A summary of the determination process was outlined as follows:
- For 23 combined cases to the value of R3.19 million, the project team assessed the cases as not irregular expenditure and recommended reclassification;
- For nine combined cases to the value of R5.76 million, the project team assessed the cases and recommended further investigation;
- For three combined cases to the value of R129 331.86, the project team assessed the cases and recommended removal from the register;
- For the remaining 64 combined cases to the value of R37.42 million, the project team assessed the cases as irregular expenditure and recommended implementation of appropriate consequence management, strengthening of controls and, lastly, condonation. The root causes were identified as follows:
- The project team said the perpetual incidents of irregular expenditure, fruitless and wasteful expenditure and loss of assets were directly caused by shortcomings in the DMV internal controls environment. This included the management’s inability to set the correct ethical culture at management level; the non-enforcement of Supply-Chain Management (SCM) policy and financial delegations of authority; the unavailability of documented business and procurement processes and procedures and flow charts; the unavailability of the SCM organisational structure to enable segregation of duties, review and monitoring of transactions and effective procurement systems; and the lack of proper security controls and measures to ensure asset management rules and regulations were followed.
- It was reported that the employees of the DMV were not fully capacitated for the functions that they needed to fulfil. The DMV must embark on capacity development for employees. There should be a sustained transformation approach which went beyond performing tasks and looked at changing the mind-set and attitudes.
- Based on the cases analysed, there was a lack of will by the Accounting Officer and Senior Management to implement consequence management within the institution. Officials continued to disregard the prescripts of the PMFA, the regulations of National Treasury, procurement instructions, and the internal policies of the DMV. The same findings were made by the Auditor-General of South Africa (AGSA). It was also believed that some employees had a significantly limited understanding of the DMV’s internal policies or the financial management prescripts of the National Treasury. However, some incidents occurred intentionally. Intentional non-compliance with procurement processes due to a lack of consequence management led to the repeated transgressions. No evidence was provided to the project team of officials who were disciplined for wrongdoing even though they had been investigated. There was just a letter informing them of the findings, and no signatures of receipt or acknowledgement were obtained. In addition, most of the Executive Management positions in the DMV were temporary.
The DMV provided the Committee with an update of the progress made with the 64 cases that the project team had assessed as irregular expenditure. Members heard that the Accounting Officer had established a Financial Mismanagement Committee comprising finance, legal, compliance and human resources. Further assessments had been made of the 64 cases, and 37 cases had been reclassified and written off, the reason being that there were no financial losses to the DMV. The Accounting Officer and the DMV’s Human Resources department were dealing with the 64 cases. It was unfortunate that the Deputy Director for Labour Relations had passed on, and that the post of the Assistant Director for Labour Relations was also vacant. The process was not moving with speed.
The determination process engaged in with the DPME was aimed at also capaciting the officials of the MV in handling the reported cases of fruitless and wasteful expenditure. As of 31 March 2020, the DMV had reported fruitless and wasteful expenditure cases amounting to R5.2 million, and further cases amounting to R3.2 million were under determination. The Financial Mismanagement Panel of the DMV would be tasked with handling these matters as soon as the relevant training had been concluded.
The following fraud cases had been reported in the past annual reports:
- Alleged fraud in the provision of accommodation and textbooks for Education Support. An investigation was done by an external service provider . A report was provided to the DMV and acted upon.
- Alleged fraud in the provision of food parcels to the military veterans. An internal investigation was done, but not concluded as those tasked complained that they did not have the investigative capacity.
- Alleged wastage in the provision of cell phones to the DMV’s staff and stakeholders. An internal investigation was still in progress to determine the potential losses suffered by the DMV.
Subsequent to the above reported cases, the determination process had suggested a need to investigate a further nine cases.
Regarding the way forward, the Committee was told that the DMV’s management has been trained by National Treasury on the new frameworks regarding irregular and fruitless and wasteful expenditure. Further training on general SCM practices was being facilitated through the National Treasury, including training on Bid Committees. SCM Standard Operating Procedures had been updated and signed and this had led to a reduction in non-compliance matters raised by the AGSA in the recent financial years. The organogram of the DMV would be renewed to ensure that the issues of segregation of duties were addressed and an Internal Control Unit was established. The present organogram did not have the required capacity. Due to the lack of internal capacity, the outstanding cases of alleged fraud would be referred for external investigation. There would be continuous training and development of all officials involved in the SCM processes to ensure a compliance culture.
Cleansing of the National Military Veterans Database
It was reported that the Budgetary Review and Recommendations Report (BRRR) had recommended that the DMV should finalise the cleansing, verification, and registration processes in regard to the DMV’s National Military Veterans Database (NMVD). The State Information Technology Agency (SITA) was expected to provide a briefing to the Committee on its support for the DMV in its effort to cleanse the database. This would be done once the cleansing had been completed.
The Committee was told that the data cleansing was a work in progress. The preparation of files for the verification processes had also contributed to the data cleansing process as duplicate files had been removed. The Database Cleansing, Verification and Enhancement Task Team (DCVETT) had been established through the Presidential Technical Task Team (PTTT) to reinforce the cleansing process. The SITA would brief the stakeholders later in the month.
It was reported that 19 725 members of non-statutory forces were registered on the NMVD. Of these, 12 569 were registered as alive, while 7 156 were registered as deceased. There were 1 848 data cleansing focus files for these non-statutory forces. Also registered were 7 900 military veterans from former defence forces with 23 703 dependents.
For this process, it was assumed that the records followed the official process that was governed by legislation set for that purpose. The verification processes between 2013 and 2015 were conducted through an official process that resulted in the registration of successful applications on the National Military Veterans Database. The cleansing process for the non-statutory forces would focus on those who did not go through these processes. A total of 1 848 files would be involved. The criteria for the completeness of a file were that an application was only deemed to be compliant when it contained the following documents: the application form; supporting personal documents; a Service Certificate; and three affidavits from former trainers or commanders. Each file was physically inspected to check its completeness, after which a report was compiled on the status of the file, and the respective associations were engaged to assist with soliciting outstanding documents. A total of 1 634 files were checked, of which 913 were found not to contain Service Certificates.
Regarding the progress on the verification process, it was reported that 5 921 applications had been received. An additional 92 additional applications were being prepared for submission to the Verification Panel. The Verification Panel had its first session on 6 May 2021, and 21 applicants were interviewed. The next sessions were scheduled for 12 and 13 May 2021.
Regarding the way forward, it was reported that the DMV was committed to ensuring the completeness of the files relating to the National Military Veterans Database. The statistics on the status of Service Certificates would be provided. Sets of data had been requested from the Department of Defence and the Department of Home Affairs to validate the identity numbers of dependents.
Mr S Marais (DA) said he appreciated the work being done by the DMV. He stated that the Committee hoped that a permanent Director General would be appointed soon to step into the shoes of Lt Gen Mgwebi. He asked for assurance on whether the briefing included all of the information of the National Military Veterans Database. There was an indication that the information only related to the non-statutory forces. Was the DMV implying that members of the statutory forces and those who had force numbers were automatically part of this database or must they follow a similar route to be registered? If that was the case, he asked for clarity on that particular backlog.
Mr M Shelembe (DA) asked for clarity on the information presented relating to Service Certificates. Was it correct that the DMV was stating that those certificates must come from the servicemen's associations? He asked for clarity on what associations were included, and that the Committee be provided with a detailed breakdown.
Co-Chairperson Nchabeleng asked what would happen to those people who did not have valid Service Certificates. The DMV needed to take a firm stance that people without the required papers would have their pensions suspended. The Committee had previously recommended that the National Military Veterans Database should be published and be available to the public, which would aid the DMV in getting feedback regarding the integrity of the information included on the database.
Ms M Modise (ANC) asked for clarity on when the training of the DMV’s management by National Treasury on the new frameworks regarding irregular and fruitless and wasteful expenditure would be concluded. Was there a timeframe for the training so that the decisions and recommendations could be implemented and acted upon?
Ms A Mthembu (ANC) commented that the DMV had been required to brief the Committee on the finalisation of the National Military Veterans Database, but that the reports were only that it had not been finalised. What had been the progress since the DMV previously reported to the Committee? It seemed as if there was no urgency to finalise this process. While the progress made was commendable, the Committee remained concerned that the process had not been concluded, as this impacted negatively on the work of the DMV. What were the challenges and problems that hindered the process from being concluded?
Co-Chairperson Xaba asked whether the information presented reflected the full extent of irregular expenditure between the period of 2013/14 to 2018/19? He stated that he asked this question because of the indication that the DPME had received nine handwritten files. Were these files complete records of the period’s expenditure? He also asked whether the briefings reflected all the cases involving fraud within the DMV.
Lt Gen Mgwebi responded that there were 58 947 military veterans listed on the National Military Veterans Database, including the non-statutory forces. As of the previous day, 17 321 of those people that were listed had passed on. He stated that there needed to be linkages in terms of the system, and the DMV needed to take responsibility in advance for those who were going to be ending their service. There were administrative processes that must be done. What happened when a person left the defence force and did not sign up for a reserve force was that they were left in the system until they made an application, resulting in too much tedious administrative paperwork? This would not be necessary if the systems were linked.
Regarding the associations’ responsibility for the Service Certificates, he stated that the confirmation of the status of these certificates and the members could be done through engagements with the associations responsible. People were unable currently to go online to check their status or whether they are included in the National Military Veterans Database. Regarding the publishing of the National Military Veterans Database, he responded that there was a need to look at the legalities of the process and the protection of personal information. On the question of why the DMV did not impose harsh penalties such as the suspension of pensions of people who did not provide the required information, he responded that it was not possible, because the DMV might have received the information from the person, but its filing systems were not up to date. The DMV did not want to prejudice people based on its own errors. The DMV had a mission to expedite the training of its management, and engagements were underway with other departments.
Briefing on the DMV’s complaints management
The purpose of this briefing was to update the Committee on the current status of complaints management within the DMV over the period of the fourth quarter of the 2020/21 financial year, and the first quarter of the 2021/22 financial year.
The Committee heard that the Presidential Hotline was established in September 2009 with an aim to unlock service delivery bottlenecks and to ensure that relevant services were rendered to the public with the cooperation of all government entities. The hotline was facilitated by the DPME and was supported by a network of Public Liaison Officers (PLOs) in national departments, provinces, and municipalities. Since the inception of the hotline, a high volume of calls had been received, indicating the need for such a service and the keenness of South African citizens to interact with the government of South Africa.
The DMV’s performance was rated on a monthly and quarterly basis according to the number of logged calls resolved. The PLOs in all spheres of government were expected to uphold a 90 percent resolution rate on all calls logged on the Presidential Hotline, with a turnaround of 25 days.
It was reported that the complaints received on the hotline focused on section 5(1) of the Military Act 18 of 2011 and included complaints relating to:
- Compensation to military veterans who sustained disabling injuries or severe psychological and neuro-psychiatric trauma or who suffered from a terminal disease resulting from their participation in military activities;
- Dedicated counselling and treatment for military veterans who suffered from serious mental illness, post-traumatic stress disorder or related conditions;
- Honouring and memorialising fallen military veterans;
- Education, training and skills development as well as facilitation of employment placement and facilitation of or advice on business opportunities;
- Subsidisation or provision of public transport;
- Pensions, access to health care, housing; and burial support.
The focus of the briefing was on the benefits and services to be rendered to qualifying military veterans. Other queries dealt with in the briefing were those that had been mistakenly allocated to the DMV, or queries that had no contact details or information.
For the third quarter of the 2020/21 financial year, there were 16 queries in total relating to housing, healthcare, beneficiary support, and educational support. Two cases remained unresolved and were older than nine months. In addition, 11 new cases were received during the fourth quarter relating to beneficiary support, educational support, burial support, and healthcare. Out of the 27 active cases, 17 were resolved by 31 March 2021, and ten were still unresolved on the ITSM9-system. There were two cases older than three months. A total of 13 cases were recorded on the ITSM9-system within the first month of the 2021/22 financial year, including 11 recurring cases from the previous financial year and only two new cases. Eight of the cases mentioned above were resolved by 30 April 2021 and five cases were still unresolved.
By the end of the first month of the 2021/22 financial year, the DMV had a 93.88 percent case resolution rate. One factor contributing to the current resolution rate was that old cases remained unresolved due to the complainant not being satisfied with the outcome of the case. Another was the backlog on education support and social grant payments as a result of the COVID-19 pandemic which impacted the functioning of the DMV during 2020.
Information regarding the operations of the DMV would be shared through social media platforms while there would also be constant updates on the website so that information could reach a broader audience. The DMV had a complaints management process that was managed jointly between its ICT and Communications Directorates. The management of complaints reflected the DMV’s management’s willingness to promote accountability, customer service, the integrity of the institution, and its commitment to improved business functioning.
It was reported that the complaints management system was partly manual and ineffective and the DMV was in the process of reviewing it. Currently, the complaints were managed via the DMV’s call centre agents, telephone calls, walk-ins, and emails. Complaints were handled as follows: the complaint was received and handled by the call centre and closed if possible, while complex complaints were assessed by the relevant branches which compiled reports and closed up the matters. A total of 73 complaints were received during the first quarter of the 2021/22 financial year.
There were plans to overhaul the functionality of the complaints management system, linking it to the Integrated Management System for efficiency and monitoring.
Mr D Ryder (DA, Gauteng) commented that the types of complaints received were a direct reflection of the poor management and a lack of oversight at the DMV. He asked for clarity on what was being done in this regard, since it was clear that people at the DMV were not doing what they were supposed to, with no consequence management being implemented. What was being done by the DMV to beef up its management and oversight internally to make sure that these issues were addressed?
Lt Gen Mgwebi responded that there were issues of accountability and the appointment of the relevant senior officers in the business environment. He stated that the DMV had the relevant management in place regarding the database, but that there were problems relating to educational support and housing issues. The DMV had approached the Department of Defence for funding assistance while the vacant posts were being advertised. Other challenges were a lack of response and discipline within the DMV’s management, as it was the task of managers to discipline the people they were supervising.
Co-Chairperson Xaba thanked the delegation for the presentations made. He said the challenges reported had frustrated the DMV for some time. Military veterans had not received quality service from the DMV, yet people were receiving salaries to perform these services. It was clear that Members were concerned that there was a lack of will by the DMV’s Accounting Officer and Senior Management to implement consequence management within the institution. It was clear that the DMV was not functioning as it should be, which significantly impacted the service that military veterans received. The Committee would consider the information received going forward.
Briefing by the NCACC
The Committee was briefed by the National Conventional Arms Control Committee (NCACC) on its Annual Report and its third and fourth quarterly reports for the 2020/21 financial year. Mr Ronald Lamola, Minister of Justice and Correctional Services, presented the briefing.
The Committee was told that the briefing included year-by-year comparisons and followed the briefings that had already been presented on the first and second quarters. These reports had been tabled in Parliament. Reporting to Parliament was prescribed by law. The NCACC could only brief the Committee on the reports already tabled in Parliament. The domestic legislative framework of the NCACC included the National Conventional Arms Control Act 41 of 2002 and was also framed by the Regulation of Foreign Military Assistance Act 15 of 1998, and the Prohibition of Mercenary Activities and Regulation of Certain Activities Act 27 of 2006.
The hierarchy of the approval involved a Cabinet Committee, made up of a ministerial delegation, at the highest level, followed by a Scrutiny Committee chaired by the Secretariat for Defence. An Inspectorate was also included in the framework and was tasked with the administration and regulation of the conventional arms industry. There were tiers of decision-making, with the NCACC currently being chaired by the Minister of Justice and Correctional Services. A diagram included in the presentation indicated the arms control process in a graphic manner. It indicated the manner in which the NCACC dealt with submissions on applications received from the industry. These submissions were prepared and considered by the Scrutiny Committee which did a review and a risk assessment. The process then proceeded to the stage of the Cabinet Committee for a decision on whether these applications were approved, held over or denied. The Secretariat for Defence then executed the decisions of the Cabinet Committee. A risk management flowchart was presented to the Committee indicating risks and mitigation.
Statistics for the third and fourth quarter of the 2020/21 financial year:
The NCACC had noted a request from the Committee during earlier engagements to provide clarity on the terms and concepts used in its briefing. A breakdown of the following terms was presented to the Committee (see the attached presentation): registration certificates, marketing (munitions), contracting (munitions), exports (munitions), imports (munitions), conveyances, exports of dual-use goods and technologies, the Wassenaar arrangements and categories, the safeguards on transfers, end-user agreements, and the reporting cycles of the NCACC.
The NCACC briefed the Committee on the statistics for controlled items, exports, imports, and conveyances for the third and fourth quarters of the 2020/21 financial year.
For the third quarter, the following statistics were reported:
- The authorisation of 38 registrations, six marketing strategies and 41 contracting permits authorised (with zero applications denied);
- The authorisation of contracts worth R2.97billion with 28 countries;
- The authorisation of 170 export permits to the estimated value of R740.22 million involving 37 countries and the authorisation of 73 import permits to the value of R163.76 million involving 19 countries,
- One conveyance permit was authorised for one country. In addition, 17 authorisations were issued to 13 countries for the exporting of dual-use goods and technologies to the value of R50.89 million.
For the fourth quarter, the following statistics were reported:
-The authorisation of 53 registrations, four marketing strategies and 50 contracting permits authorised (with zero applications denied);
- The authorisation of contracts worth R8.97 billion with 26 countries;
- The authorisation of 160 export permits to the estimated value of R 3.11 billion involving 40 countries, and the authorisation of 113 import permits to the value of R87.51 million involving 24 countries.
- No conveyance permits were authorised. In addition, 45 authorisations were issued to 12 countries for the exporting of dual-use goods and technologies to the value of R 66.46 million.
Statistics for the entirety of the 2020/21 financial year were:
-The authorisation of 130 registrations, 22 marketing strategies and 147 contracting permits (with zero applications denied);
- The authorisation of contracts worth R 15.57bn with 59 countries;
- The authorisation of 628 export permits to the value of R3.11 billion involving 56 countries and the authorisation of 269 import permits to the value of R1.49 billion involving 35 countries;
- One conveyance permit authorised for one country. In addition, 83 authorisations were issued to 25 countries for the exporting of dual-use goods and technologies to the value of R206.91 million.
Comparisons were made with the 2019/20 financial year.
In conclusion, it was reported that the NCACC’s operational framework was grounded in domestic law which was harmonious with international treaties and conventions. The Cabinet Committee applied itself effectively within the confines of prescribed laws and supported compliance with South Africa’s international commitments on arms control. Members of the defence industry registered under the National Conventional Arms Control Act must operate within the parameters of the Arms Control Framework.
Co-Chairperson Xaba thanked the NCACC for the comprehensive briefing made to the Committee.
Mr Marais thanked the NCACC for the briefing. He stated that he would have liked some more details on issues that were raised in previous engagements with the Committee. He referred to his question in a previous meeting regarding permits for exporting ammunition to Mozambique. The relevant Minister had confirmed that such permits were issued. It was indicated that the requisite information would be reflected in future reports but it had not been included in the NCACC’s briefing during this meeting. Referring to security operations in Mozambique by a private security company, he said they used ammunition and aircraft platforms that must have gone through the NCACC’s permit application process. The same applied to the Paramount Group in South Africa. He asked that the Committee be provided with the permit information on this group.
Regarding the issuing of export permits, he asked how regularly the NCACC held its sittings. Members would recall that one of the frustrations of the defence industry in the past was that shipment orders were held up. There had also been ongoing rumours since February that no permits had been authorised for exports to Saudi Arabia, the United Arab Emirates, and Turkey. These markets are 80 percent of potential exports, and if orders could not be executed, it would have a devastating effect on the defence industry and would have compounding effects on job security and future exports.
The NCACC responded that its sittings did not take place in January during the entity’s recess period. Preparations for the year were still underway, and the sittings of the NCACC took place from February to November every year, according to the schedule of Parliament. In addition, sittings took place on the fourth Thursday of every month where possible.
The rumours mentioned by Mr Marais, regarding permits not being issued, were incorrect. The NCACC applied the law to determine whether permits were authorised or not. It was not the case that the NCACC was deciding, without any justification, not to deal with exports to those jurisdictions.
However, the NCACC was cautious about how it approached the question of the permits for Mozambique, as raised by Mr Marais. The relevant documents relating to the question on the permits for Mozambique would be submitted to the Committee. The NCACC had approved the following items for Mozambique: four armoured vehicles with turrets but without weapons, and a helicopter with sensors and weapons. The total value of the authorisations amounted to R18 million. The entity that was authorised was duly registered in terms of the NCACC’s enabling legislation. These items were authorised for exclusive use in accordance with the end user undertakings. Reports regarding the claims that Mozambique had engaged a company in order to help Mozambique engage the terror threat in the northern part of the country remained untested. However, work was being done to determine the veracity of these reports. The NCACC could confirm that no application was received to use the equipment in other countries. This meant that South Africa authorised the equipment to go to the Government of Mozambique.
Co-Chairperson Xaba welcomed the assurance that South Africa continued to comply with international commitments on arms control. A major preoccupation of the Committee was the achievement of a balance that took into consideration international obligations, addressing proliferation concerns, preserving jobs within the arms industry and ensuring compliance with legislation. He said the Committee had previously highlighted concerns around the lack of adequate opportunity to engage the NCACC and welcomed the chance to scrutinise the report to satisfy itself about the work of the NCACC. The Committee noted the impact of the COVID-19 pandemic on the defence industry and was hopeful that the lowering of restrictions would aid the rejuvenation of the industry, ensure the preservation of jobs and contribute to South Africa’s economic growth. The Committee was committed to continuous engagements on the work of the NCACC.
Consideration of allegations against the Minister
Co-Chairperson Xaba then stated that the next item for consideration was letters received from the leader of the United Democratic Movement, General Bantu Holomisa, who was also in attendance during the meeting. He reminded Members of the situation. The Committee had received three letters during its constituency break, dating from March 2021. During the Committee’s previous engagements, a legal opinion had been provided by the Parliamentary Legal Adviser on the competency of the Committee to deal with allegations of receiving kickbacks and mismanagement of resources made against the Minister of Defence and Military Veterans. He stated that it was alleged that the Minister had received wads of cash and gifts totalling R5 million from a South African National Defence Force (SANDF) contractor between 2017 and 2019. This was included in a letter from General Holomisa.
During these previous engagements, it had been concluded that the way forward would be to invite the Minister to respond in writing to the allegations of receiving kickbacks and mismanagement of resources, and to meet on 13 May to determine the way forward. The relevant departments were still busy with the processes of verifying invoices, which would be tabled the following week. He stated that he would formally table the Minister’s responses to the first two letters written by General Holomisa. The Committee had the competency to investigate the matter, including using the available mechanisms to seek witnesses and documents, compile reports, hear oral evidence, and conduct public hearings. It had previously been decided that it would be fair to afford the Minister the opportunity to respond to the allegations, before deciding whether the Committee should proceed to launch an investigation. In the meantime, the Committee would write to General Holomisa to inquire whether the people making the allegations against the Minister would be prepared to assist the Committee with its investigation and be prepared to depose a declaration of facts on the allegations. The Committee must now use the opportunity to deliberate on the allegations of irregularity levelled against the Minister of Defence and Military Veterans, Ms Nosiviwe Mapisa-Nqakula, and to seek answers to these questions firstly from General Holomisa.
General Holomisa stated that there was a need for the Committee to obtain a declaration of facts by the whistle-blower. He stated that when the Committee had procedurally agreed that there was prima facie evidence to support the allegations, Members could take a decision on whether to launch an investigation on the matter. Once the Committee decided on the mechanism to investigate the matter, there would be terms of reference for the institution tasked with conducting the investigation. There might be a need for forensic auditing in some areas relating to these allegations. It was at that stage that you would expect that two witnesses must submit declarations of facts under oath, which should also apply to the Minister. He asked that the Committee agree that there was prima facie evidence to support the allegations, and to deliberate on the mechanisms that should be followed to take the matter forward.
Co-Chairperson Xaba responded that General Holomisa was standing in the position of the complainant regarding this matter. He opened the matter for discussion by Members.
Mr Marais stated that there was an issue in that the Committee did not know what the relationship between General Holomisa and the whistle-blower was, which could be a conflict of interest. The Committee could not make a final decision on the participation of General Holomisa in this process. The Committee must rely on the legal advice from the Parliamentary Legal Advisors on how to deal with whistle-blowers when they wanted to stay anonymous. No court would allow a case to be heard without evidence. Regarding the response from the Minister, he stated that the Committee had received her supporting documents. Clarity was sought on issues such as why the Minister had to charter a flight, incurring such high costs when the President of the country invited her to escort him, and alternative options were available. However, the evidence provided by the Minister showed that the trips and accommodation in question were not illegal. The allegations by General Holomisa would constitute hearsay in a court of law, and clear indications of laws being disobeyed were required.
Mr Ryder stated that General Holomisa, as a Member of the Committee, is merely being used as a conduit after being approached by the whistle-blower. Someone else had made the allegations through him, and thus there was no conflict of interest or any reason he should recuse himself from any discussions or debates on the matter or prevent him from making further inputs as part of the Committee. He had a right to participate in the process. The duty of the Committee to investigate these allegations against the Minister was clear, and the question of whether her actions were legally incorrect or just bad judgment, or neither, was for the Committee to decide on. The conduct of the Minister did not necessarily need to be illegal for the Committee to make its findings, and to contemplate whether it was serving in the interests of the country. He stated that there was sufficient evidence in the original allegations and subsequent admissions to make it necessary for the Committee to discuss and interrogate this matter further.
Mr T Mmutle (ANC) stated that the Committee comprised public representatives that represented its constituencies. The Committee must resolve to elicit further detailed information from the Minister to enable the Committee to make a determination on the way forward that was supported by the Parliamentary Legal Advisors. There must be sufficient evidence to substantiate the allegations made.
Ms N Nkosi (ANC, Mpumalanga) agreed that General Holomisa, as a Member of the Committee, was merely being used as a conduit after being approached by the whistle-blower, and as such he had a right to participate in the process. It was crucial that the Committee engaged further with the Minister.
Co-Chairperson Xaba said there was a need for further advice from the Parliamentary Legal Advisors.
Ms Sueanne Isaac, Parliamentary Legal Advisor, responded that Members had raised the issue of the Minister’s response not being complete. She advised the Committee to consider whether the Minister deliberately decided not to respond to certain allegations, and whether it would be within the Committee’s mandate to ask her to respond to all the allegations. She stated that the Committee could consider writing to the Minister asking that she respond to all the allegations, in order to have a full view of her responses before the Committee decided on the appropriate course of action going forward.
Co-Chairperson Xaba agreed with the suggestion from the Parliamentary Legal Advisor. He concluded that following a response from the Minister of Defence and Military Veterans to the allegations levelled against her, the Committee resolved to elicit further detailed information from the Minister to enable the Committee to make a determination on the way forward. The Committee would, upon receipt of further substantive responses from the Minister, decide on the appropriate course of action.
Co-Chairperson Xaba thanked Members and the delegations in attendance for the contributions made and the information that had been presented to the Committee.
The meeting was adjourned.
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