The Department of Sport, Arts and Culture presented its annual report for the 2021/22 financial year on a virtual platform. The Department reported that the year under review was characterised by Covid19, the July unrest, KZN floods and gender-based violence and femicide. The Department has experienced a 2% improvement in the 2021/22 financial year as compared to the 2020/21 financial year, achieving 76% (34/45) of targets set for the year.
A key issue was the under-expenditure that had taken place, particularly as this was often related to vacancies in the Department at a time when there was a high level of unemployment. Members of the Committee viewed this as a persistent trend, and urged the Department to fill the vacancies and enable its funds to be spent on the necessary programmes.
Where infrastructure projects were not completed, such as the building of gyms and the Sarah Baartman Centre of Remembrance, Members raised their concerns and wanted to know when and how they would be completed. The Department acknowledged its challenges in dealing with infrastructure projects, and indicated it was working with the Department of Public Works and Infrastructure to overcome these obstacles.
Consequence management remained a big problem within the Department, and the Committee asked it to take the necessary steps to deal with mismanagement.
DSAC 2021/22 Annual Report
Mr Vusithemba Ndima, Acting Director-General (DG), Department of Sport, Arts and Culture (DSAC), presented the annual report, and referred to events that had characterised the year under review. These had ranged from the effects of the Covid-19 pandemic, the wave of civil unrest in July 2021 and the KwaZulu-Natal (KZN) floods, to the scourge of gender-based violence and femicide (GBVF) that swept the country.
Highlights of the cultural and creative industries sector had been:
- The South African Cultural Observatory's (SACO’s) 2022 mapping study outcomes, which showed that design and creative services provided 32% of the cultural and creative industries’ (CCIs’) contribution to the gross domestic product (GDP), followed by audio-visual and interactive media at 30%, and visual arts and crafts at 15%.
- The performance and celebration domain contributed only 6% of the CCIs’ contribution to the GDP. This could be attributed to the restrictions on gatherings, free association and movement due to Covid-19, in line with protocols and infographics of the World Health Organisation (WHO).
- To mitigate the high youth unemployment rate, the Department has supported several youth programmes, among them the Debut Fund Programme, the Young Patriots Programme, and the Artists in Schools Project, just to mention a few.
- The direct impact of the CCIs in 2018 was R74.39 billion, which accounted for 1,7% of South Africa’s GDP. In 2022, this contribution had increased to R161 billion, accounting for 2.97% of South Africa’s GDP.
- ArtbankSA had partnered with the Cultural and Creative Industries Federation of SA (CCIFSA), resulting in the employment of 95 artists and ten regional coordinators in the creative industries, to create commissioned artworks.
- 47 social cohesion dialogues were held because of the unrelenting gender-based violence and femicide (GBVF) cases and the intensification of Operation Dudula.
- The Department had cumulatively produced 5 231 language practitioners with various language qualifications at both undergraduate and postgraduate levels.
- Heritage bursaries were awarded to 61 students for language bursaries, of which 43 were females and 18 were males. 54 of the students were black, five were white and two were coloured.
- 34 new modular libraries and 55 upgrade/maintenance projects were financially supported.
- 71 towns, three cities, six airports, over 100 villages and 40 post offices, among others, achieved new democratic South African identities through transformations of the heritage landscape programme.
Highlights of the sport sector included:
- The Department continued to support a total of 37 learners who were identified during the National School Sport Championships held prior to 2020 through the Sports Bursary Programme.
- The Andrew Mlangeni Green Jacket Awards, in honour of the country’s sport legends, was awarded to eight beneficiaries, who received the special green jacket that was meant to set them apart from others in various sporting codes.
- 2 309 learners participated in the National School Sport Championships.
- 4 732 schools, hubs and clubs were provided with equipment and/or attire as per the established norms and standards;
- 101 740 learners participated in district school sport tournaments;
- Over 2 416 teachers were trained;
- Over 252 jobs were created for school sport coordinators;
- Over 181 school sport structures were supported.
The Department experienced a 2% improvement in the 2021/22 financial year, compared to the previous financial year. It had planned to implement and achieve 45 performance targets in the financial year 2021/22, and 34 (76%) had been achieved.
The overall spending had been R5.6 billion (98.2%) against the final appropriation of R5.7 billion. Compensation of employees (CoE) amounted to R335.9 million, which was R43.1 million below budget due to vacant positions at different stages of the selection process. Spending on goods and services had been less than one percent below budget, at R507.8 million. The total budget of R2.1 billion for community libraries and mass participation conditional grants has been transferred to provinces and municipalities. There was minimal under-spending on Departmental agencies, but the under-spending of R1.5 million at higher education institutions was owing to the failure of the University of Stellenbosch to submit compliance documents. R5.5 million had been transferred to various international organisations for annual subscription fees, where the underspending of R193 000 resulted from the exchange rate at the time of payment processing.
(Further details can be found in the presentation attached.)
The Chairperson commented that the presentation was very stressful, as R1.6 billion in underspending was recorded.
Mr T Mhlongo (DA) also expressed his concern over the presentation. There was irregular expenditure and under-spending. What was the reason for not achieving goals, such as gyms? There had been money allocated for the gyms, so what were the reasons? The Department was actively involved in different activities and programmes. For Kwazulu-Natal, there had been an overachievement. Now it was questioned whether the target had been set lower there than what was expected. For example, if the Department said they would build 10 gyms but had then built 20 gyms, the target might have been set low and now it would seem as if there had been an overachievement in some key performance indicators (KPIs). In future, all budgets and targets for each programme should be given so that it could be seen exactly where there was underspending and who was responsible for irregular expenditure.
The budget performance was 98%, but not the provision of services. What measures had been put in place to ensure that projects could succeed? There was currently an acting DG -- when would a permanent DG be appointed? Every year this vacancy was advertised, showing that someone was not doing their work. There could not be a R10.7 million under-spending on vacancies. Unemployment in South Africa was very high, and it did not make sense for under-spending on vacancies to be so high.
The presentation did not show the KPIs and budget allocation for the Mzansi Orchestra. Irregular expenditure and underspending were monitored and discussed last year, and it seemed like it was coming right. What was the budget allocation, and what were the reasons for the under-spending? The Department must explain the poor administration of the National Arts Council (NAC). The Department had poor control and this impact could be seen in the annual report.
Mr B Madlingozi (EFF) said the Department needed to give more detailed information on the companies and the money that was allocated to each one. How much money of that money had gone to artists and sports people? Did organisations that had nothing to do with sport, arts and culture, who received money from professional service providers (PSPs) that should have gone to artists, pay the money back?
Mr M Zondi (ANC) acknowledges the presentation by the Department even though there were many concerns. The work done in service delivery was appreciated. It seems as if COE was the main reason for the slow spending in Program One. What impact did this have on the Department’s ability to fulfil its mandate and deliver its services in the sector? Did the Department have the capacity to effectively support all the entities and boards facing challenges of under-spending in some areas?
The Department's audit committee had noted matters that needed attention. This included the lack of adequate infrastructure management, poor coordination, poor management, no constant reporting, delays in project implementation, lack of requisite skills, poor monitoring of memorandums of agreement (MOAs), ineffective information communication technology (ICT) governance, delays in initiating forensic investigations when needed, and a poor control environment in respect of record management. The internal audit activity did not have enough capacity for the 2021/22 financial year and had been unable to complete all audits as per the annual plan. Consequent management for non-compliance and logistics were also challenges that were mentioned. Considering all the above matters, what measures had the Department taken to improve to provide better service delivery?
Ms R Adams (ANC) pointed out that eight years had passed since the construction of the Sarah Baartman Centre of Remembrance, which was due for completion in 2019. There was a lack of movement and attainment of targets regarding the development of facilities. The Department constantly failed to spend its financial appropriation. Why did it not digitise its Mzansi Golden Economy (MGE) application processes to minimise the demands of a manual process, as there was no adequate unit to respond to the requests? The annual irregular expenditure had increased from R23.9 million in 2020/21, to R105 million in the year under review. What action would the Department take to deal with the non-compliance? She listed several entities where there was irregular, and asked when the Department would carry out the needed investigation into these entities.
Mr D Joseph (ANC) said COVID-19 and the floods in Kwazulu-Natal (KZN) had affected the Department greatly, but there had been good work overall. When oversight over the annual report was done, the Committee should be balanced in its approach and give credit where credit was due. There was still a low performance percentage, although it had risen from 74% to 76% -- it was far from 85% and above. Targets for five Moral Regeneration Movement projects had been set, but none was achieved. Had those targets been transferred to this current year, or were they increased or decreased to be more realistic and ensure different results? Should the targets be adjusted, given the circumstances that they were facing?
The Department should look at seconding personnel. Some areas were achieving well, and maybe it should consider seconding directors, chief directors and senior management to other areas where they were not doing well. This was usually what private companies did when they needed management capacity in other divisions.
What were the plans going forward on the heritage projects, as these were subject to the involvement of the Department of Public Works and Infrastructure (DPWI)? After seven years, something had to be done to expedite these projects, after the many concerns raised before. What had the DSAC and the DPWI planned to do?
A 98% achievement was not bad, even though R5.6 billion out of R5.7 billion had been spent. When doing oversight over the Department and its finances, the Committee had to be realistic and consider that 98% was a very good and high percentage compared to other departments.
Mr Joseph expressed his embarrassment over the non-compliance of the University of Stellenbosch, as it was a highly regarded institution.
Clarity was needed on expenditure at non-profit organisations (NPOs), and the under-expenditure on administration (92.4%) remained a big concern.
He asked why an internal dispute involving the Department, National Treasury and the Auditor General had ended up in the Constitutional Court. Referring the matter to litigation and a constitutional judgment was taking it to a far extent. How did it end up there? Why could it not be resolved within the government structures?
Ms D Sibiya (ANC) wanted to know what caused the consultations and completion of the social compact delays. What was the nature of corroborating evidence? Why was it found to be inadequate? Targets were not met by the sports federations -- did all of them submit their data? Which federations had met their targets and which had not?
Ms V Malomane (ANC) drew attention to the targets of the federations, and also asked if they had submitted their data, and which had met their targets. If the federations had not met their targets, what were their reasons?
The Chairperson acknowledged the achievements of the Department. However, it became alarming once there were talks about R1.6 billion in underspending. When it was heard where and how the under-spending happened, it could be seen that other stakeholders were not accounting. There was a need to check what everyone could do for the Department and what tools could be brought forward. What mechanism had the Department put in place to stop the provinces from taking money and not accounting?
How would the 2022/23 annual performance be planned? Would targets be significantly higher than the baseline of the previous financial year? What was the Department’s vacancy rate, and what impact did it have on the entity’s functionality? Since the merger of the two departments, there has been a problem with vacancies. The Department could not perform well if all its vacancies were not filled. There would be a lot of unused money because the vacancies were not filled. The Department needed to tell the Committee exactly what it would do to fill the vacancies. She was unhappy about money not being used because vacancies were not filled.
What actions had the Department taken to strengthen its administrative compliance with the general information management standards of programmes? It was recommended that the accounting officer monitor the implementation of the audit action plans. The Auditor-General (AG) was present, and the Department had to ensure sufficient monitoring reports and control over compliance with supply chain management (SCM) legislation. Effective consequence management should be considered and managed so that its implementation is visible. A progress report must be submitted to Parliament, but the Department should also increase the monitoring and evaluation capacity of its entities and councils. The Department must propose a plan, and the Committee needed to agree to it, as they did the oversight. Immediate intervention was needed, and all sister departments should be called in. It put the Department in a bad light when entities were not accounting, and the funds were not being used.
Mr Ndima said all the Committee's questions had been noted. The Department has been working on monitoring and consequence management. There were certain standards that the AG expected for consequence management, and it was important to indicate that consequence management took different forms in government. It depended on the degree of infringement; sometimes, an infringement was innocent and had to be brought to the attention of an official. It meant that measures were needed to build the capacity of that particular official. It was about giving warnings when people could be corrected, and there would also be instances where people were disciplined and removed from the system. Many interventions have been done, including infringements around mass participation events and grants, where there had been an amended payment by Treasury in line with the Division of Revenue Act. In this case, one official had been identified as being responsible for the irregular expenditure. The consequence management was implemented according to labour relations, as they provide the guidelines for public service issues by the Department of Public Service and Administration (DPSA).
The talks about library grants coordinator's procurement had one official allocated to be responsible for encouraging regular expenditure and consequence management. It had been finalised and condonation had been requested from National Treasury. In this case, consequence management for the allocation of funds not approved by National Treasury could not be implemented, as the responsible official had resigned. The Department was implementing consequence management all the time, but a system was followed and official rights were not infringed upon and all procedures were followed. When there was corruption, disciplinary processes were implemented.
The under-expenditure was not R1.6 billion; it was R106 million. This was not a small amount, but the correct figures must be stated.
The Chairperson interrupted, and said it was reported that there were insufficient invoices for R1.6 billion, and he should refer to that slide.
The DG responded by saying it was not R1.6 billion.
The Sarah Baartman project had been delayed for a very long time. Last week, the two Ministers met to look at these projects and the DSAC and the DPWI came up with a remedy for this project. They would be submitting a report, and acknowledged the delay in the project. The way of working with DPWI has changed. The Department used to be just a client without participating in key decision-making processes. It had signed a core management agreement with the acting DG of the DPWI where the DSAC would be actively involved in the process when there were issues of variation orders or changes that were happening in projects. The challenges would then be able to be dealt with.
Some of the other expenditure was where grants were offered to artists in the arts and culture space. They would take the first tranche, which normally was bigger because it enabled people to do their projects, but they did not come back to account. This created problems for the Department, as they could not transfer the next tranche. These people tended to receive the first tranche and then disappear. The Department had to implement blacklisting. It should not do business with them and not provide them with any support, because this was not working in good faith.
Ms Mandisa Tshikwatamba, Deputy Director-General (DDG): Corporate Governance, DSAC, addressed the issue of filling vacancies and its impact on the organisation. The Department was relatively new and they were a bit delayed with finalising the final grade composition in terms of its final structure. It was still in progress and required a delicate balance to maintain. Retaining employees could be very difficult. Many employees were always anxious about where they stood with introducing new structures. They were not sure whether their jobs would be secure or whether they would be in a better position. Because of this, people were leaving the Department, and it was trying its best to maintain its performance. The Department had started with a 20% vacancy rate, and the bad position had not improved as it was now around 18%. It was constantly filling positions and promoting people, but was experiencing a turnover rate of about 12%. The annual report showed that there were about 71 exits, and this included contract employees. Contract workers throw out the balance, and therefore the Department was looking forward to a new structure. When assessing the vacancy rate, it had to be assessed against permanently employed people.
She gave details of the Department's efforts to fill vacancies caused by promotions or employees leaving the Department. It took four to five months to fill a position in the public sector, based on the different procedures that have to be completed. To save money, the Department had decided to add contract positions to ensure people were employed and money was spent on employment. As of last month, there had already been advertised for 36 permanent positions and contract positions. The Department was trying its best to improve its vacancy rate.
If there was a finding against an employee, the Department would do a root cause analysis and the manager would be contacted. The one identified as a transgressor would need to provide responses accounting for what had happened. It could involve issues of training, a change in policies, issues of improving standard operating procedures, or matters of discipline. This area required vigilant monitoring, and there were frequent reports to the management committee on what was happening until all cases were closed.
An issue raised about the Moral Regeneration Movement (MRM) had been their target. MRM has been battling many challenges, including staff capacity and governance issues. The Department was monitoring to keep them accountable, and would ensure that someone checked up on what they were doing. MRM would fail to submit reports, even after something had happened. Once a report was missing, even though the Department knew what had happened, the validation documents were not counted and were not present. That was how the system worked, and the Department could not change it. This was one of the issues that the MRM had been struggling with, raising concerns over their internal capacity. The Department was trying very hard to assist them in this regard. Some financial statements were late, but they were still included, and where money would be allocated was reflected in the report.
The process of the social compact had started earlier, and there was a break in 2020 because of Covid. The Department had gone to the government cluster committee to process everything. The cluster had assessed the document, but felt it still had to go back to the National Economic Development and Labour Council (NEDLAC). When the Department was at NEDLAC, there was a delay because it was struggling with admitting the document in the way it was. NEDLAC understood the compact that the President had been speaking about. It was something different that had been brought to them -- they thought the issues brought to them were issues of jobs and an economic compact. Time was lost trying to explain where the two met. Momentum had been gained, but some things would still be missing in terms of the target of the implementation plan, because without the compact, there would be no implementation, and no target would be achieved.
The funds that were allocated to non-profit organisations (NPOs) had gone to three organisations that had been identified for support. In the slides, the organisations that benefited were mentioned and showed where the money went.
Ms Sumayya Khan, DDG: Recreation and Sports Development, DSAC, responded to questions about the underachievement of providing gyms. When looking at the report that had a provincial spread, it should be noted that many of the targets and achievements were based on conditional grant funding. The conditional grant funding was given to the provinces using a formula. The formula means that each province got a different amount of money. Ideally, it would be given to provinces in terms of their equitable share, but it had been realised that when funds were allocated according to the equitable share, provinces like the Northern Cape would always get very little. All provinces should get R20 million, and then the balance should be divided using the equitable share. KZN and Gauteng would always get the biggest amount, even using the formula. Then there was a self-sacrificing scheme of KZN and Gauteng, where they sacrificed R2 million and R3 million respectively, and gave it to the Northern Cape. The Northern Cape got much more than the figure given by the equitable share. Covid-19 had interrupted many plans, so the plans of the KZN were very virtual, and they had tried to look at the smaller activities spread out throughout the province. In that way, they had made their achievements, which was more than other provinces.
On the issue of the federations that did not meet their targets, it was the year of the pandemic. When looking at the 19 federations that were part of the transformation process, three federations had not submitted their reports during the year. Two federations had dealt with serious problems. Both chess and basketball were facing serious challenges. Football did not report back to the Department, and they also faced many problems.
The five codes that had met their targets for the year were netball, rugby, softball, tennis and cricket. Athletics, baseball, boxing, gymnastics, hockey, skiing, rowing, swimming, table tennis and volleyball did not meet their targets for the year.
The targets, and the self-set barometers, were set by the transformation charter. When the targets were measured, they were measured against the targets the federations set themselves. The pandemic also greatly affected the targets of the federations as international participation and competitions were not held due to the restrictions.
The key campaign numbers were already very low, and all events had to be held on a smaller scale as they had to restrict the numbers based on the Covid-19 regulations. A Big Walk was held with about 500 participants. The national youth camps also took place. Normally there were about 200 participants, but the numbers were cut to 100 per province. There were only 900 participants at the national youth camps. The Move for Health was also held on a smaller scale -- only 1 200 people participated. The indigenous games, which normally get 5 000 participants, were scaled down to 1 500 participants. Nelson Mandela Day was not held on a specific platform, as it was held in partnership with the Nelson Mandela Foundation, where the Minister participated in a virtual cycle in which 1 200 people participated. The ministerial outreach programme also took place, which was also one of the campaigns. There was a minimum of 200 outreach programmes, and about 400 people participated.
Mr Lebogang Mogoera, Chief Director: Sport Infrastructure Support, DSAC, discussed the issue of overachieving targets. One programme that had overachieved was the Municipal Infrastructure Grant (MIG) where the Department was supposed to provide support to 50 municipalities, but 100 were supported. Normally when targets were set, the Departments looked at the allocations for the year. They also considered the allocations made in the previous financial year and the municipalities that still had to complete their projects. Sometimes the number would be 50, but if the provision was made for those who were likely to use their MIG, then the Department would support them in completing their projects. The MIG conditional framework also invited the completion of responsibility even in community projects that were not funded. In some instances, there would be a significantly high demand that ultimately led the Department to overachieve.
Four of the gyms that were not completed in the past financial year were completed in this financial year. Contractors were busy working on them at the moment, and by the end of the month, a fourth gym would be built, and then all ten gyms would be completed. The delay occurred when the contractors were requested to build ten outdoor gyms. The contractors were given three years to complete the project at the time. Then, a separate request came through for three gyms, one of which was when the Department merged. It was said that when the Department delivered infrastructure, then the nature of the infrastructure on site must also reflect the Department in terms of heritage facilities, together with the sports facilities and citizens, in a single space. The other outdoor facility was in the Winnie Mandela sports facility, opposite the house of the late Winnie Mandela in Brandfort, where there was an open space. It was an additional request, and some confusion came about regarding the finances in the contracts of the contractors. It was more expensive than the original gyms at the time. When the gym’s expense was reported in that financial year, it was not accepted. The fourth one was also affected, mainly because of the codes for the other three. It had been expensive, and funds were depleted. Those were the outstanding gyms. Three of them had already been completed, and one would be completed by the end of the month.
There were issues of monitoring mechanisms relating to infrastructure matters and inadequate capacity of the infrastructure-related projects. With the entities and the municipalities, there were both constant and periodic site visits. There were many challenges, especially with the municipalities and within the Department’s entities. These issues included non-compliance. There was an infrastructure management programme that entities were supposed to comply with if they received allocation tranches. If they did not comply with the requirements of the policy, then the transfer became very delayed. The Department acknowledged its obligation to not transfer, as those entities did not qualify. Through the construction team and managers, the Department was still building capacity, and was working on improving their compliance. If they complied, it would assist them with the money. Over time, the Department has been trying to improve the measures to improve its technical capacity. Several engineers and quantity surveyors are on the ground now, including the construction project management.
Projects were moving forward and improving. The memorandum of agreement (MOA) had been signed with the DPWI. There would be a joint steering committee which would be made up of the two agents that were going to be working on a project. This would increase the role of decision-making and troubleshooting when variations happen. The variations would be approved, depending on the allocated timeline. It depended on the contract type, including the issue of the extension of times, because those were the issues that contributed to the delay. The Department was not going to be a bystander in this matter, so it had developed a roadmap that would include its principles. The anticipation was that new procurement processes to get contractors on-site would be completed before the end of the year. This execution plan showed that the Department would likely have a contractor back on site at the Sarah Baartman facilities in April. An implementing agent would also be appointed. The Department was looking for an alternative mechanism to ensure that the sites were protected. There were other forms of services that were rendered through term contracts, covering issues such as landscaping maintenance to keep things running on site until an actual building contract started.
Dr Cynthia Khumalo, DDG: Arts and Culture Promotion and Development, DSAC, responded to a question about the Nyanga arts centre. She said the Department could not get funding approval from the National Treasury. The Department wanted to support the centre, which was based in Cape Town, and was one of the implementers of the "artists in school" programmes that the Committee would be aware of. There was a dire need for infrastructure improvement at the centre. It had approached the Department, and a process had been started with an evaluation of the existing building and looking at options. When this process was finished, there were savings on the project, as not all the money had been spent. National Treasury was then approached. The Nyanga Arts Centre was supported, but the Department wanted to take the project further. This year, it looked at the infrastructure development plan for Nyanga. There were certainly technical challenges that were faced involving the province and the municipality, as well as the Nyanga Arts Centre. These issues included ownership and title deeds.
With the Caiphus Semenya Foundation, Dr Khumalo recalled that this question was asked in August at a meeting. The Department explained that it had supported the Caiphus Semenya Academy of Arts over the years. This was based in Jabulani in Soweto, and through the experience at Caiphus Semenya, the Department had forged a partnership to have the academy up and running. It had assisted with these plans with up to R10 million in funding. The academy supported and breached the gap between the talents and skills accumulated by emerging artists and what was offered at the higher education institution level. This was the work that the Caiphus Semenya project was doing at the school of art in Jabulani in Soweto. In the last financial year, there were savings that the Department owned, and they had been used for the infrastructure projects in Nyanga which National Treasury had not approved.
In the presentation on the Mzansi Orchestra, the Department had indicated that the money had been transferred to the National Arts Council over the past few years specifically for the support of the orchestra. This money had been transferred to the orchestra when it was established by the NAC. That was where the money had gone at that time. The Department had reported on the MOA signed by the orchestra and the NAC to play oversight over how those funds were used. This was the reason why there was no KPI appearing for the Mzansi Orchestra in the annual report.
The Department did not claim to meet all the needs and targets in the industry, but considered that they could not have enough budget to meet all the requirements of the creatives. It had a full record of those programmes that were directly implemented by the Department, mainly at the entities that were used, such as their museums. There was a full record of who the beneficiaries of the funding were.
The report was tabled to the Committee on the Creative and Cultural Industry Federation (CIFSA), which gave a historical background and explained how it was constituted, including who the current leadership was. Based on the business and project plans, together with the meetings that the Department had held with CIFSA, it could be seen that their targets were geared towards the sector, and they were reaching those they were servicing in the industry.
The Department had received approval from National Treasury (NT) for a rollover of funding for public art projects specifically. Ten different entities were going to implement public art projects, and three of them were not museums. When the Department returned to those entities to say that they had received approval from NT and were ready to start signing MOAs, they indicated that it was too late in their financial year. They had already taken on other commitments that would not make it possible for them to execute the particular public art project. These three were the William Humphreys art gallery, the Afrikaanse Taal Museum, and the Gauteng Tourism Authority. With the Gauteng Tourism Authority, there were a lot of issues even after the Department received approval from NT, as they were not submitting the correct documents to the Department. It was not making any progress and the report towards the end of the year reflected under-spending against this project of R2.3 million against the R7.8 million received. Those were the three entities, where two had declined and the third one had failed to meet the requirements.
The management of MOAs was focused on. The Department recognised the weaknesses not only of the beneficiaries, but within its ranks as well. The audit committee had requested a plan including the measures to deal with this particular issue. It was looking at proactive steps which would include tightening up the MOAs that had been signed and continuing with capacity building for its project managers. Consequence management needed was because of negligence and dereliction of duty. The Department looked at measures and legal services to ensure that beneficiary defaulters were dealt with. The first tranche was a large amount of money that allowed beneficiaries to execute a project, but they had to submit their reports to receive their second tranche, and the Department was experiencing problems in this regard.
The Department had about 403 applicants approved for funding, of which 327 were funded and paid. Of the 327 that had been paid, a total of 285 reports had been received. If the reports were correct and aligned with the MOA, the second tranche could be paid. This usually took a lot of time. The open call process was completely online, but after that, it became manual. If applicants were successful, the Department had to put a person in place to whom they could submit their compliance documents. This process took a lot of time because it was a manual process.
There were challenges with Stellenbosch University in the last financial year because they had not been able to submit an authority letter. The person who was supposed to sign the MOA had been delegated to do so by the Vice-Chancellor. The Department could not get hold of the person to sign the papers, so it could not finalise the matter. This was resolved in the current financial year and the payment had also been made.
Mr Rabelani Muditambi, Director: Management Accounting, DSAC, responded to the matter of the court order. There was a group that had taken the Minister of Finance to court over the preferential procurement regulation in the black economic empowerment (BEE) point allocation. The court order said that it was unconstitutional, and the National Treasury had issued an exemption to all government departments which ruled that any procurement above R30 000 would go through the threshold of BEE point allocation. The exemption was lifted in April. In March and April, not much could have been done, and it had affected all the payment processes. Those that were supposed to have taken place would have fallen under the exemption, but the Department had received clarity on the issue and could continue with their procurements and payments.
He said slide 34 might have been misread to indicate that the under-expenditure was R1.6 million. The overall spending summary, as seen on slide 12, was where the Department reflected R103.6 million as the overall under-expenditure. There was a breakdown of all the programmes.
Ms Adams asked what lessons the Department had learnt from the areas that had over-performed, and how it could broaden its impact, as people were open to playing sports for recreational and professional development.
When the Department encountered contractual challenges, what action had it taken as consequence management to recognise the negative economic impact of not spending?
Mr Joseph asked further questions on the Sarah Baartman issue. It was a long period from now until April for the project to continue, but he understands that this was because there was a holiday in between. In the previous meeting, it had been indicated that there would be a joint responsibility between the DPWI and the DSAC -- what was this agreement? Who was responsible for what? Did the DSAC have the management capacity to manage this project?
The Chairperson added that the Committee should apply for an oversight visit to the Sarah Baartman area, because it was trying to find out what was happening there. Like with the oversight visit to Robben Island, the Committee could see for themselves what was happening there. They could see that DPWI was not doing what they were supposed to be doing.
Mr Ndima responded to Ms Adams that first they had to establish an understanding of the contractual arrangements to build the capacity among officials, because the idea was to build capacity rather than destroy it. Where negligence took place, consequences were implemented against those officials.
The period until April for the Sarah Baartman project to begin was a long time, but this time was used to ensure proper procurement was in place. The Department would try and resolve the problem. There had been a bit of improvement in employing people who knew the technicalities, but more work could be done in this regard.
The oversight visit to the Sarah Baartman site was noted and approved.
Ms Khan explained that the DSAC had a dual mandate -- there was a mandate for a winning nation and an active nation. Within the active nation programme, there was a campaign called "I choose to be active," and the other eight campaigns tried to get the masses to participate. When looking at activities that were held on National recreation day, which happened on the first Friday of October, every province celebrates it and it was not a once-off thing. This day encourages people to be physically active, as they should be for 365 days. In addition, there was the Big Walk that was held in October. Historically there had been the participation of 30 000 people. Every province and district had these types of walks.
The "I choose to be active campaign" had grown a lot. There were many activities both online and physical, to engage with. They provide an opportunity for people to actively participate. The Department also partnered with organisations such as the "sport for social change" movement that promoted active and healthy lifestyles through their activities. It also worked with Love Life, which allowed communities to participate. Through mass participation, the Department could also do talent identification.
There was an effort from the Department to make sure that they massify their activities through the various programmes and campaigns. The different provinces also did this through their existing activities, and federations also had activities that they used to promote healthy lifestyles. A lot was done in athletics, such as marathons and fun runs. These events always had elements of mass participation. Organisations endorsed by the Department had fun runs every weekend in various communities. People could run, walk, or cycle, and the Department supported this. Indigenous games were also used for mass participation at a recreational level.
Adoption of minutes
The meeting adopted Committee minutes.
The meeting was adjourned.
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