DHET & DSI 2021/22 Quarter 1 & 4 performance

Higher Education, Science and Technology

25 August 2021
Chairperson: Acting: Ms N Mkhatshwa (ANC)
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Meeting Summary

The Committee convened in a virtual meeting to receive quarterly reports from the Department of Science and Innovation (DSI) and the Department of Higher Education and Training (DHET).

The DSI reported on its progress with the science, technology and innovation (STI) Decadal Plan that had received in-principle agreement from National Treasury that a public STI budget coordination mechanism be integrated into the annual medium-term expenditure committee process to improve the allocation of funding for STI across government departments. The DSI had achieved 74% of its targets. By the end of the fourth quarter, the actual spending for the period had amounted to R7.165 billion, which was 98.4% of the total adjusted budget of R7.278 billion.

Members asked about the consultation process on the STI Decadal Plan; the lack of provision of supporting documentation by entities and implementing agents of the DSI; establishing priority for filling vacant posts; alignment of the DSI and its entities’ strategic plans with the Decadal Plan; details on the embezzlement of millions of rands of government funding at the University of Johannesburg, which had come from the DSI, the Industrial Development Corporation (IDC) and the university; the main factors causing contract delays; and progress on the review of the Technology Innovation Agency (TIA).

The DHET's quarterly reports covered the five-year strategic plan outcomes and significant developments during the period under review. These included an improvement in the eradication of the certification backlog; 161 lecturers attached to public technical and vocational education and training (TVET) colleges graduating from the Nelson Mandela University with an Advanced Diploma in Technical and Vocational Teaching in December; distribution of the College Infrastructure Efficiency Grant (CIEG); the introduction of new programmes in response to the fourth industrial revolution (4IR); and investment into health and wellness infrastructure at community education and training (CET) colleges. The Department had achieved 72% of its targets in the fourth quarter, but only 67% in the first quarter of the current financial year.

In the fourth quarter, R50 million had been reprioritised to the National Student Financial Aid Scheme (NSFAS) to fund its budget shortfall; R6.005 million had been reprioritised to fund the shortfall in the write-off for fruitless and wasteful expenditure; and R14.201 million had been reprioritised to fund the shortfall on the payment of leave gratuities resulting from the termination of services. In the first quarter, Treasury approval was obtained to reprioritise R3.040 billion for NSFAS to cover the student funding shortfall in the 2021 academic year.

Members asked why the deadline for clearing the certification backlog had been missed; sought details on the kind of training that had been provided to the TVET college lecturers; asked about the status of student accommodation structures in the face of Covid-19; sought reasons for presiding officers withdrawing from disciplinary cases; and wanted to know whether the Department would meet its revised targets with its revised, reduced budget.

Meeting report

The Acting Chairperson welcomed everyone present and acknowledged the apologies of Minister Blade Nzimande and Director-General Phil Mjwara, who were attending a meeting of the Standing Committee on Public Accounts (SCOPA). It had been three months since the Committee had engaged with both Departments.

Department of Science and Innovation (DSI)

Ms Gugulethu Zwane, Deputy Director-General (DDG): Institutional Planning and Support, DSI, took Members through the presentation, which covered the fourth quarter of 2020/21 and the first quarter of 2021/22.  It dealt with the Department's key achievements, performance highlights, overall performance, overview of performance and financial performance.

Regarding progress on the Science, Technology and Innovation (STI) Decadal Plan, she said there had been agreement in principle by the National Treasury that a public STI budget coordination mechanism be integrated into the annual medium-term expenditure committee (MTEC) processes, in order to improve the allocation of funding to STI across government.

On overall performance, in the fourth quarter of 2020/21, the DSI had achieved 74% of its targets. It assured the Committee that it had implemented mitigating measures and interventions to address the 26% of targets that were not achieved, but it was also important for Members to note that these were not annual targets.

Mr Robert Shaku, Acting Chief Financial Officer (CFO), DTI, presented the financials of the Department, and indicated that it had planned to spend R7.278 billion by end of quarter 4. The actual spending for the period had amounted to R7.165 billion (98.4%). The DSI had effected virements amounting to R133 million from slow-spending activities to those which were experiencing shortfalls. A R128 million virement had been approved by National Treasury, while R5 million was approved by the Director-General (DG).

In the first quarter of 2021/22, the DSI had planned to spend R1.716 billion, but the actual spending for the period amounted to R1.122 billion. This amounted to 12.6% of the overall total budget of R8.933 billion.

[See presentation for details]

Discussion
 

The Acting Chairperson said that the Committee was pleased at the approval of the Decadal Plan by Cabinet in March. It was also satisfied that the Department was now in the process of consulting with various stakeholders within government, and once that process was completed, it would move to consultations with external stakeholders in the sector. The Committee had stressed the importance of ensuring that they were as inclusive as possible in consulting with external stakeholders. Hopefully this process would be done as quickly as possible, but also thoroughly.

She acknowledged the work of the DTI in response to Covid-19, as well as its entities for accelerating the work of the vaccination roll-out programme. She invited the Department to share some insight on the work that it had been doing in responding to manufacturing the vaccine. The country was recovering from a period of unrest, and it would be interesting to know whether there was any work that the Department had done to identify the drivers of the unrest, and whether there were any solutions it could offer to ensure that something of that nature did not happen again.

She noted under-spending in programmes two, four and five, mainly due to the provision of insufficient supporting documents and contract delays. As for supporting documents, where the entities had not been aware of the evidence that was needed to be provided, how could this challenge be mitigated going into the future? As for contract delays, what were the main factors involved, and what could be done to address them?

Which posts would be given priority in the current recruitment process by the Department? The CFO had been seconded to the Department of Higher Education and Training (DHET) during the previous financial year -- what was the status of this process? What progress had been made in filling the post of DDG for research development and support (Programme Four)?

Would there be an annual science and innovation plenary this year, and had the inter-ministerial Cabinet committee on STI been appointed? What progress had been made in aligning the Department and its entities' strategic plans with the Decadal Plan? Had the consultation process for the regulations been approved, and if so, when would the consultations begin?

On slide 61 and 62 of the presentation, it seemed that some of the black-owned businesses were small, medium and micro enterprises (SMMEs), and others were women owned -- was it correct to assume that these businesses could overlap? Because of Covid-19, there were procurement opportunities, and it seemed all the companies were owned by black women – could the Committee get clarity on this? Regarding Covid-19 procurement, during the two quarters there had been a great improvement in the number of opportunities provided to small businesses.

Ms J Mananiso (ANC) referred to the Department's demographic profile, and said it had undertaken to improve the reporting of transformation. She reminded the DTI it was important that this information on the inclusion of women and persons living with disabilities was provided in detail.

In the district development model (DDM), where were some of the programmes going to be piloted? Regarding the targets not achieved because of Covid-19, were there any plans to improve on this to ensure that they were achieved in the middle of the pandemic?

Mr T Letsie (ANC) mentioned a newspaper article he recently saw, alleging that University of Johannesburg officials were in involved in the embezzlement of millions of rands of government funding. It had stated that the money was from the DSI, the Industrial Development Corporation (IDC) and the University of Johannesburg on an intellectual property project. Could the DSI provide the Committee with details of what had happened here?

Secondly, with the procurement of personal protective equipment (PPE), normal and standard practices of supply chain management (SCM) would not have been followed in sourcing quotations. However, it was disturbing that when SCM practices were not followed, no women and youths had been considered. What was meant by not following "normal SCM practices?" Was this about contacting suppliers already on the database? If so, the youth and women had been overlooked -- and they were usually overlooked under normal circumstances. One often saw youth and women-owned businesses being overlooked for procuring goods and services, and this was worrying because their exclusion from the mainstream economy continued to be a challenge in this country. In future, the Department needed to look into empowering those who were on the periphery, and the underdogs.

In the 2020/21 fourth quarter, according to Treasury’s data, the DSI had under-spent by almost R130 million. Had it been possible to roll over any of the unspent money to the next financial year? If so, how much would be spent? If not, why had this money not been spent during the current financial year?

What were the main factors of the contract delays, and what would be done to mitigate that in the current financial year? What was the Department’s current vacancy rate, and which posts would be given priority during the current recruitment process? What was the status of the secondment of the CFO?

Since the beginning of the Sixth Parliament, could the Committee receive some progress on the review of the Technology Innovation Agency (TIA)?

Ms D Sibiya (ANC) asked which criteria were used to identify the farmers that would be trained. It looked like it was only farmers from the Eastern Cape, but what about the other provinces?

The Chairperson commented on the district development programme, and said that the Committee would be receiving a briefing from the DSI on this model on 7 September.

Referring to having an inclusive science and innovation sector, she said it was time to realise that it was not enough for men to know that they had male privilege, and that the Committee was serious about representation, and it had to be translated into reality based on the targets and goals that they had set. The opportunities that were being made available by the DSI must extend to people who were considered marginalised and on the periphery. They must not be only for those with privilege.

DSI's Response

Mr Imraan Patel, Acting Director-General, DSI, said he had noted the questions on the Decadal Plan, and acknowledged the need for an active process of external consultation.

The drivers of unrest was an important point, and the DSI had engaged on this matter with its entities such as the National Institute for the Humanities and Social Sciences (NIHSS), which was under the DHET. It was part of their overall work, which formed part of the National Policy Data Observatory in strengthen their understanding of socio-economic drivers -- not just the unrest, but what was happening generally in the country. The DG had engaged with entities to try and extract some existing evidence to indicate what needed to be done. They had identified the need to work more closely with the group of researchers to shape a much more structured agenda on this. Hopefully, in the second quarter feedback, they could provide an update.

He noted the comments on insufficient documentation, but the key point that needed to be made was whether the entities had been aware of the documentation. Over time, this had been highlighted, and they had agreed with the entities on the format of the reports, but when new projects were being initiated, proposals would be sent to the entities seeking more details. The DSI had become more robust over time with the sort of documentation that it requires. The entities know what is required on standardised programmes, but it was only in new programmes where supporting documentation may be required.

He requested to be allowed to provide the response on the vacancy rate and the status of the DDG for Programme Four in writing.

Regarding the CFO's secondment, the CFO had been appointed at DHET and the secondment had ended because it was a full time post. The DSI had decided to fill the CFO post themselves.

The District Development Model would be provided in detail, as the Chairperson had indicated earlier, on 7 September. An update would still be sent to the Committee in writing.

On the UJ matter, the institution had responded swiftly on this matter. It had released a report, which detailed the status of recovering the funds, and stated that the matter had already been referred to the Hawks. The report could be made available to the Committee.

The TIA review had been completed, and a report was presented to the Department about two weeks ago. At the moment, they were processing that report in consultation with the Minister on how they wanted to move forward.

Ms Zwane responded to the Decadal Plan consultations, and said the DSI had made a lot of progress with many departments. It had consulted with the Science Council, cohorts, and several other departments. In some instances, they had had to separate the consultations. The last consultation had been with Treasury and the Department of Performance Monitoring and Evaluation (DPME) about the budget and monitoring of the Decadal Plan. The DSI still needed to consult further with the private sector and others outside the public sector. They had also requested the Presidency to advise on the establishment of an inter-ministerial committee (IMC), and had received feedback that they did not need that process to be led by the Presidency. The IMC may be scheduled some time on September.

The delays around the capturing of data from the documentation centres and fitting that data with the National Recordal System, were Covid-19 related. They had had meetings with all the documentation centres, and the situation had returned to normal at most of them. This would be reflected in the next quarter.

The delays in capturing the contracts were also due to verification of information which had been delayed by reasons that were Covid-19 related.

Mr Shaku responded that some of the SMMEs involved in the DSI's procurement were black and women-owned businesses.

Another factor influencing contract delays was a framework developed by the DSI, which stipulates the fees that the entities or the implementing agents could charge the Department. This framework was still new, and there were instances where the agents complained that the fees were not sustainable for them, and this had caused delays on some of the projects. The framework allowed for flexibility, but it had to be substantially motivated if the implementing agent indicated that the prescribed fees were not sustainable for them.

A rollover had been requested from the National Treasury, but it was not approved. They could request a rollover only for funds that had already been committed. They were now quite strict in transferring money to entities. If an entity did not spend the money, they did not make transfers because that affected the Department.

Mr Patel assured Members that the outstanding questions would be responded to in writing.

Department of Higher Education and Training (DHET)

Ms Nolwazi Gasa, Acting Director-General, DHET, presented the 2020/21 fourth quarter and 2021/22 first quarter performance report, which covered the five-year strategic plan outcomes; significant developments during the period under review, programme performance and financial performance.

The significant developments during the period under review included:

an improvement in the eradication of the certification backlog, with 96.04% of certificates having been dispatched;
technical and vocational education and training (TVET) college lecturers' development, through which 161 lecturers attached to public TVET colleges had graduated from the Nelson Mandela University with an Advanced Diploma in Technical and Vocational Teaching (Adv Dip TVT) on 19 December 2020;
the College Infrastructure Efficiency Grant (CIEG) had delivered six of the 13 grants, which were now with the beneficiary colleges;
the introduction of new programmes in response to the fourth industrial revolution (4IR); and
in the fourth quarter, the Department had invested R10.8 million, in addition to the R8.975 million from the Health and Wellness Sector Education and Training Authority (HWSETA), into a partnership with Higher Health to build health and wellness infrastructure at Community Education and Training (CET) colleges.

In the fourth quarter, the overall performance amounted to 72% achievement of targets, while in the first quarter, the DHET had achieved only 67% of its targets.

Reporting on the financials in the fourth quarter, Ms Gasa said R50 million had been reprioritised to the National Student Financial Aid Scheme (NSFAS) to fund its budget shortfall. R6.005 million had been reprioritised to fund the shortfall for the write-off of fruitless and wasteful expenditure. R14.201 million had been reprioritised to fund the shortfall on the payment of leave gratuities resulted from the termination of services.

During the first quarter, Treasury approval had been obtained to reprioritise R3.040 billion within the vote for the NSFAS student funding shortfall in the 2021 academic year.

Discussion

The Acting Chairperson asked for a status update on the "Day Zero" for the certification backlog. She sought clarity on the training of TVET lecturers, and whether the Department had been able to conduct an analysis of the input of the training, and whether it was compatible with the output of the results of the students. Was the reality of Covid-19 being factored into the training of lecturers who now had to teach during the Covid-19 pandemic, and were having to rely on technology to do so?

She also asked for details on the monitoring tool that had been highlighted in the presentation. Was there a greater or lesser reliance of student accommodation since the Covid-19 outbreak, and what did the accommodation situation look like, taking into account its effect?

Referring to disciplinary case targets, she asked why the presiding officers had withdrawn themselves from the cases. Were there any performance agreements with the presiding officers to ensure that they were able to fulfil their duties as delegated?

On irregular expenditure, if there were no cases received, was it because there were no cases, or because the cases not being brought to the Department’s internal audit unit?

Lastly, she asked for an update on the expansion of online learning.

Ms Mananiso said that she was happy that there was commitment in terms of entrepreneurial skills for job creation, as well as the inclusion of 4IR into the post-school education and training (PSET) system. She also asked for an update on the certification backlog and the institutional infrastructure for TVET colleges. The Department needed to do more about utilising the infrastructure grant.

She commented that there had been a significant increase in the targets, from 60 to 80, and asked if the Department would be able to execute its mandate and achieve the revised targets, considering the revised budget.

Mr Letsie was pleased with the appointment of a DDG for the CET branch of the Department. He suggested that the Committee should be furnished with a report that outlined the financial health of the CETs, SETAs and TVET colleges – each branch of the institutions must assist in providing a comprehensive financial report on each.

Given the Covid-19 pandemic, which universities had generated income through a third stream of income? Members needed to understand the financial health of the institutions and see where there were challenges with historically disadvantaged individuals (HDIs) and others.

The DHET had failed to achieve the target on disciplinary matters due to the withdrawal of presiding officers, and had cited various other reasons. These reasons were too general, and the Department needed to be specific on which cases were delayed, and why the presiding officers had withdrawn -- and from which cases.

He sought confirmation on the irregular expenditure in the quarters that had been presented. Had the Department concluded its investigations into the irregular expenditure that had been incurred in the previous financial year? If not, what were the reasons?

The reason for invoices unpaid within 30 days was said to be caused by staff working from home, and the fact that there were insufficient resources made available to them. Why had the Department failed to provide tools of trade for staff members to be able to work from home, and what was being done to mitigate this?

Ms Sibiya said that the targets for Programmes Two and Three were not outlined, and asked why there were no targets against the budget. How many universities had not complied, and which universities were they?

Dr W Boshoff (FF Plus) said that the Committee had not received any explanation about the sacking of the Director General. Providing an explanation to the Committee on what was going on and what should be expected would be the proper thing to do, because this situation affected the Department’s performance.

The Committee had been informed in the previous meeting that the TVET branch wanted to close down the Northern Cape rural TVET campus. Were there be any new developments regarding this?

The Chairperson said that the Committee would continue to ensure that the political leadership availed itself to take the Committee into its confidence regarding the matter involving the Director General. The Minister was set to attend the meeting, but due to last minute changes, he had to attend the SCOPA meeting taking place at the moment.

DHET's Response

Ms Gasa said that this was the fourth department she was working in, and she hoped that when the Covid-19 pandemic was over, the Department would have an opportunity to hold a two-day strategic session to take the Committee through the work that her team had done as deputy-director generals (DDGs).

Mr Sam Zungu, DDG: TVET Colleges, DHET, explained what was holding the Department back from achieving Day Zero on the certification backlog. Progress had been made, but the challenges were related to record-keeping, because some of these certificates go back to 1992. In some instances, they had limitations in getting the information, but it was something that was being addressed.

It was too early to measure the outcomes of the training for the lecturers, but at the end of the academic year, the DHET should be able to measure properly and have a comprehensive analysis. In the next academic year, they would be able to see if there had been any change after the intervention was put in place.

Referring to the increase in remote learning because of Covid-19, and whether the training provided to lecturers had taken that into account, he said some of the training programmes had been developed before Covid-19, but since the outbreak, the Department had introduced technology into some of the programmes. This would ensure that digital skills were infused in the future as well to adapt to the remote teaching that they now had to abide by.

On redress and the disparity in allocations for TVETs versus the allocations for universities, the elephant in the room was the issue of the "inverted pyramid," but they needed to ensure that in the revised funding model they address these matters, and highlight the areas that were causing serious gaps in funding for the TVET sector. They were facing challenges with the stakeholders over the 60/40 ratio for expenditure on transport.

There was a programme on entrepreneurial apps that the Department was running in the TVET sector, but it was focusing on technical skills for now, and one of the SETAs involved in the motor industry had come forward to assist with this.

The DHET was able to submit the latest update on the distribution of laptops, and would furnish the status update on how far this had gone to the Committee. There was an issue around how many institutions had been affected by the recent unrest, and there had been looting of computers in two of the institutions. However, in the residences there were no major incidents that taken place or been reported.

Mr Zukile Mvalo, DDG: Skills Development, DHET, replied that the nature of the skills strategy forced the Department to work with almost everybody. A working group had been established to finalise the skills strategy, and this group met almost every week. The skills strategy was demanded, and forced the Department to engage and meet with every stakeholder. It had met and engaged with many other departments, and was currently in engagements with them.

Ms Lulama Mbobo, DDG: Corporate Services, DHET, said she would be responding to questions on Programme One. The vacancy rate in the Department, the rate at the time of reporting, was 9.5%, which was slightly below the 10% target. In quarter four, the Department had advertised 213 positions and had filled 19 vacancies. It was in the process of filling in the remaining vacancies.

The vacancies included the head office, regional offices, and lecturers in colleges.

The reason why presiding officers withdrew was that when an official transfers to another Department, the chairperson automatically withdraws from that case. The other incident was at the college level, and the Department had not yet received reasons why the presiding officer had withdrawn from that college. The reasons for the postponement of cases varied, and the Department was affected by social distancing, so it took time to create the platform to have the cases attended to virtually.

The DHET did monitor as required by the Department of Planning, Monitoring and Evaluation (DPME) and the Department of Public Service and Administration (DPSA) because the cases had to be captured on the Personnel Administration System (PERSAL). The monthly and quarterly reports were submitted regularly.

She said that although they encouraged their staff to vaccinate, they regarded this as a private matter. They had provided resources such as transportation to transport members of staff to vaccination sites. They were also engaging the Government Employees Medical Scheme (GEMS) to provide on-site vaccination facilities within offices.

During the reporting quarter, they had had four cases of irregular expenditure, and these had involved SCM where officials had not complied with SCM processes.

The post of Director General had been advertised, but she could comment on the DG issue because that was a matter that would be attended to by the Minister.

A summary report would be provided on the withdrawal of presiding officers from cases.

Ms Thembisa Futshane, DDG: CET Colleges, replied that the digital skills programme concern had been noted in the non-achievement of the target. They were making progress in ensuring that they got the DG's approval for the digital skills programme. While they were waiting on the paperwork for the DG’s approval, they had commenced with a pilot of the programme. The pilot was currently being implemented in the Eastern Cape CET College. It had started in 2020 and was envisaged to end in the first quarter of 2022. Currently, there were 30 students in this programme and the point of the pilot was to identify the gaps so that it was not taken to scale without a proper analysis.

She thanked the Committee for its recommendation on the development of the CET Advocacy Strategy, and it had been approved. The focus was now on the implementation of this strategy, and this would be shared with the Committee.

They had noted Dr Boshoff’s concern regarding the need for feedback on the DG situation, but they were working on improving the critical areas that needed intervention. In the next engagement, they should be able to provide a more detailed report on this.

Mr Reineth Mgiba, Acting Chief Director: Policy Planning and Evaluation, said the strategy on online learning was in response to the need for online and multi-modal and blended learning. When they presented the strategic plan and the annual performance plan, they had to acknowledge that the intention would involve a number of things required for it to be realised, which would include capacity, e-learning materials and support systems, amongst others. The strategy that had been developed sought to enable any PSET institution access to the educational network; to provide free access to students and staff to be able to use the educational network; and to be cost effective. The intention was to implement this strategy in phases.

The Committee could be provided with a comprehensive report on this.

Ms Gasa said she would respond in writing on any other questions that had not been answered. There were still outstanding responses on infrastructure, finance and gender-based violence.

The Chairperson welcomed the suggestion -- the meeting was running over time because both departments had spent more time on the presentations.

The meeting was adjourned.

 

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