(SubCommittee) DCS readiness to take over Public Private Partnership Centres at expiration of contracts

Meeting report

The Chairperson received apologies from the Minister, Mr Ronald Lamola and Deputy Minister, Patekile Holomisa. The DCS team would therefore be led by the Acting National Commissioner; DCS, Mr Makgothi Thobakgale.

Opening comments
Mr Thobakgale stated the Department was presenting the plans for the takeover of the PPP facilities located in the Free-State/Northern Cape (FS/NC) and Limpopo-Mpumalanga-North West (LMN) regions. Two presentations had been submitted to the Committee. The first presentation contained the main scope of the work in terms of contractual obligations of both parties and themes to be considered by the Department in future. The Department has taken the decision to not extend contracts beyond contractual deadlines. The action plan that had already been set in motion to prepare for the takeover, was documented in the second presentation. The Department would be monitoring the implementation of the action plan on a quarterly basis in line with well-established processes as per the Annual Performance Plan (APP).

The Chairperson requested the Acting National Commissioner to use the opportunity, towards the end of the meeting, to brief the Committee about the recent prison escape. He needed an explanation of the current status of the situation and whether it was under control.

Department of Correctional Services Presentation: Contract Management
The Acting CFO introduced Ms Roseline Phahlane, Acting Deputy Director: Contract Management, DCS, who delivered the main presentation on contract management.

The establishment of the PPP Correctional Centres is mandated in terms of the amendment of section 103 of the Correctional Services Act, 111 of 1998. The PPP Correctional Centres were established to acquire additional accommodation, to gain knowledge and expertise from the private sector and to foster a partnership between the public and private sector with the emphasis on the humane treatment and development of inmates.

The Department signed two PPP agreements. On 1 July 2001, the Contractor Bloemfontein Correctional Contracts (Mangaung) commenced with operations to design, construct, operate, maintain and finance a prison of 2 928 bed spaces for a period of 25 years. This contract will end on 30 June 2026. The Contractor South African Custodial Services commenced with operations on 16 February 2002 to provide 3 024 bed spaces at Makhado (Louis Trichardt) for a period of 25 years. This contract will end on 15 February 2027. The DCS decided not to extend the contracts after the expiry dates.

The PPP facilities are located in the Free-State/Northern Cape (FS/NC) and Limpopo-Mpumalanga-North West (LMN) regions. The Contract Management Directorate of the Department is managing the contracts of the PPP facilities in collaboration with the Regional Commissioners. Each facility is being supervised by a management team and a Project Officer (Controller). The Mangaung facility has a capacity of 2 928 bed spaces per unit, (i.e. six units with 488 bed spaces) while the Kutama Sinthumule facility has a capacity of 3 024 bed spaces per unit, (i.e. six units with 384 bed spaces and three more units with 240 bed spaces). In addition, both facilities provide for a Segregation Unit to facilitate health and mental care.

The contract fee payable by the Department is split into a fixed component for the payment of the building and an indexed component for payment of annual operational costs. The fixed component in relation to the Mangaung facility expired after 15 years, i.e. on 30 June 2016 and after 17 years, i.e. on 15 February 2019 in relation to the Kutama Sinthumule facility. The indexed component remains payable for the full contract period. Since the inception of the two projects, R7.7 billion had been paid in respect of Mangaung facility and R8.4 billion in respect of the Kutama Sinthumule facility. The estimated payment after the 25-year contract period is projected at R21.2 billion for both projects. The Department has been conducting a dilapidation survey on a bi-annual basis to determine the physical condition and state of maintenance of the facilities. A full dilapidation survey of the facilities would be conducted 24 months prior to the end of the contract term or following the notice after the full operation date in the event of a termination.

(See presentation)

Department of Correctional Services Presentation: Action Plans

Mr Thobakgale requested guidance from the Chairperson on whether the second presentation, which consisted of an Action Plan, should be presented at this stage. The task team led by the two Regional Commissioners were available to present the Action Plan.

The Chairperson redirected the question to the Members.

Members agreed with the suggestion of Mr J Engelbrecht (DA) that it would be preferable to complete both presentations instead of following a piecemeal approach.

Mr Tlabo Thokolo, Regional Commissioner, Limpopo, Mpumalanga and North West (LMN) region, presented the Action Plan on behalf of the two regions. The Action Plan outlined a wide range of key deliverables and activities to ensure a smooth takeover process of the two PPP facilities.

Mr Thobakgale appointed two task teams led by the FS/NC and LMN Regional Commissioners to manage the takeover process. The Chief Deputy Commissioner at Head Office is meeting with the task teams on a regular basis to monitor the progress and status of the key deliverables and activities in compliance with the stipulated due dates as per the Action Plan. The first two meetings were held on 13 December and 22 December 2021 at the office of the National Commissioner. The next meeting is scheduled to take place in the Northern Cape between 6 April to 10 April 2022.

(See presentation)

Discussion
Mr Engelbrecht asked if an assessment had been done about the costs involved in taking over the facilities. He enquired about the costs per head in terms of the current costs and future costs when the DCS would be in charge. He questioned whether the DCS would be able to deliver the same level of effectiveness of the facilities that was achieved over the past couple of years. Private companies were not allowed to over-populate facilities based on contractual obligations. Addressing over population in the system was a big concern as all but one project was placed on hold due to budgetary constraints, therefore no new beds were added. It seemed the same experience of over population would occur at the PPP facilities after the takeover. He asked if the issue of taking on new contracts was off the table for the long-term. He agreed it was not in the best interest of the Department to have private institutions controlling maximum facilities. But it would be wise to re-think the stance on private facilities in correctional services given the success rate of these institutions. It would be an extremely difficult environment to operate considering current and future budget cuts and given the whole sad destabilising effect that Bosasa had on correctional services. He asked if the Department was setting people up for failure.

Ms N Maseko-Jele (ANC) enquired about the physical state of the facilities which the Department would be taking over. She asked if the Department had consulted with the Department of Public Works (DPW) about the magnitude of the maintenance work that the PPP facilities would bring. No PPP corruption issues had been reported. She asked what lessons the Department had learnt on how to manage security at PPP facilities. The presentation was unclear on whether the staff who worked at the PPP facilities would be transferred to the Department. She sought clarity on the human resources matter.

Mr Thobakgale replied to the matter of overcrowding by referring to the 250 beds that were under construction as part of a maintenance project in Parys and the 500 beds planned for Burgersdorp which was a DPW project. An additional 1 500 beds would have been added by the time of taking over the PPP facilities. The number was a drop in the ocean given the inflow of inmates on a daily basis and the lengthy sentences imposed by the courts. The DPW formed an integral part of the supervisory team involved in the takeover process. The involvement of DPW would extend beyond the takeover process. He welcomed the input on lessons learnt from the PPP way of work and would include it as an additional activity in the Action Plan. Treasury would be roped in for their PPP expertise.

Mr Thokolo said key recruitment deliverables had been included in the Action Plan. The deliverables comprised of the configuration of current staff at the two facilities. In addition, positions would be advertised and learnership programmes were being considered.

Ms Cynthia Ramulifho, Chief Deputy Director: Human Resources, DCS, said the Action Plan included proper migration and placement in terms of the strategy considering the difference in salary scales between the PPP and the DCS. In addition to the job evaluation plan that had been submitted, the security clearance would be redone.

Mr Engelbrecht observed that he did not get an answer about the takeover costs involved. He proposed that a response be given in writing if the information was not readily available. He did not expect officials to have the figures on hand but it was important to know the contractual obligations that the Department was committing to. He would be satisfied if the Committee, at some point, could be provided with an indication of the costs. He appreciated the way things work, i.e. that a decision had been taken which the officials have to execute. He nonetheless requested the Committee to have a discussion on re-thinking the extension of contracts.

Ms Maseko-Jele said it had been reported that the PPP facilities were well-managed and were employing a specific way of dealing with consequent management. She asked how the Department would be dealing with corruption in DCS facilities.

Mr Thobakgale apologised for omitting to respond to some of the issues. The average costs per head were R435 at the PPP facilities and R388 at the DCS facilities. These tentative figures included a daily cost for housing and activities, corrections and rehabilitation. The first six weeks of the Action Plan would be spent on firming up information to provide clarity on the costs involved. The contractual obligations were informed by the schedules in the contract. The Department would return to the Committee with specific information if there was a need to involve external expertise after the takeover. At the moment, the DCS was using the current available resources. The task at hand was quite serious and needed due care. An assessment would be done on how the combined public and private sector facilities would be operating. The Department was relying on Treasury for procurement processes. Both contracts had similar problems in terms of contract management issues for which a regime of fines was in place as stipulated in the contracts. The Department could provide specifics should the Committee require further information to support the presentation.

The Chairperson asked if the PPP facilities were the model prisons that were hoped for.

Mr Thobakgale confirmed the PPP facilities were model prisons in terms of planning, structure and design. The system was designed to prevent overcrowding. The Corrections and Administration record keeping processes were better than that of the Department. However, due to the size of the PPP facilities, the scope of clinical issues such as offender complaints, support and rehabilitation, were not as wide-ranging as those at the DCS facilities. The facilities would assist with high-profile, long-serving offenders. Issues of segregation and security requirements would be raised. The PPP facilities were privileged and protected by the contract in terms of the number of beds that were available to them. It would be ideal if all facilities could be subjected to the same requirements. Once the PPP facilities were taken over, it would be subjected to the pool of challenges experienced by the DCS facilities.

The Chairperson remarked that the response pointed to the need for an urgent oversight visit so that Members could have a complete picture of the issues. He suggested that the oversight visit should be prioritised in consultation with the Northern Cape and Limpopo teams. He allowed time for a briefing on the issue of the prison escape.

Mr Thobakgale explained the recent prison escape occurred at the Rooigrond Maximum Correctional Centre in Mafikeng (North West) on 15 March 2022. It is estimated that the four offenders escaped in the early hours of the morning from their cell which they shared with 35 other offenders. Pictures have been circulated in the public space. The offenders - two Mozambique nationals and two South Africans - were in prison for housebreaking, theft, assault and possession of firearms. The offenders were housed in Unit 1 where the process of reform and schooling programmes take place. Unit 1 is referred to as a high-care unit in terms of the population profile. The facility is housing 897 maximum offenders and has a staff complement of 133 including nursing staff and psychologists. On the night in question, seven officials were on duty, one was on vehicle patrol and another was in charge of Unit 1. The same official was also responsible to manage Unit 2. This was painting a picture of how budget cuts affected DCS operations. The preliminary investigation would be subjected to a full-scale investigation including cell inspection to check for unwanted or illegal objects that could be used to initiate an escape. The outside of the building, where the DPW was busy doing boiler maintenance work at the back of the cell, was inspected. During the time of the escape, the power plant next to the boiler was undergoing maintenance. A review would be done on the response of the official on duty who found the rope used in the escape. The entire management process would be assessed to stabilise the facility. The DCS supported the refurbishment of the tower posts which were providing more visibility. The offenders cut through the burglar bars, scaled down the fence and left the facility. The entire DCS management team would be applying their minds to possible improvements. The issue of staff shortages was flagged as a serious matter. Some officials were doing double and, in some cases, even triple shifts. He assured Members that there would be consequences based on the outcomes of the report. The Department was working with SAPS who sent out alerts to other provinces which are bordering neighbouring countries.

The Chairperson asked Members if they had questions about the prison escape.

Ms Maseko-Jele said the situation was embarrassing particularly for Members of the Committee who visited the facility not so long ago. Members were assured that all was in order and that the towers were constantly being managed. She was concerned that no one was being held accountable for disciplining officials. It was worrying that the issue of staff shortages was mentioned now that the matter of the escape was being dealt with. She held the view that the Committee was being lied to on these site visits. It was difficult to understand why the escape took place soon after Members visited the facility.

Mr Thobakgale agreed with the description of this unfortunate incident as an embarrassment. This escape was not foreseen given the pledge of support for security enforcement. He had received the preliminary report the previous night and again reassured Members that action would be taken. The briefing to the Committee was based on the interaction with staff and what he observed on his inspection in consultation with the management of the facility. He did not regard the issue of staff shortage as an excuse.

The Chairperson said the Department would be requested to return for further engagement on the issues that had been raised. The engagement would not be based on a specific incident but in reference to targets in the Annual Performance Plan. The Commission would continue to engage the Department on the issues raised by Ms Maseko-Jele.  He thanked the DCS team for the interaction and reminded the officials of the homework on outstanding responses, e.g. on the issue of takeover costs.

Minutes adopted

The Committee considered and adopted the minutes of 26 November 2021 and 11 March 2022, which were adopted without amendments.

The Chairperson noted that one set of minutes was outstanding.

Members agreed to move the remaining set of minutes to the next meeting to allow for a follow up on the outstanding information about state patients.

The meeting was adjourned.