Department of Tourism on Q1&2 2022/23 Performance; South African Tourism (SAT) board adverts; with Minister and Deputy Minister

Tourism

06 June 2023
Chairperson: Ms T Mahambehlala (ANC)
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Meeting Summary

The Portfolio Committee on Tourism expelled the Department of Tourism from the meeting after it failed to present information requested by the Committee.

The Department of Tourism had been expected to brief the Committee on the performance of the first two quarters of the 2022/23 financial year, but it chose to present information on the two previous financial years. During the early stages of the presentation, it became clear to Members of the Committee that the Department kept on referring to the 2020/21 financial period.

In its defence, the Department stated that the information it presented lagged behind because of the data processes with Statistics South Africa, which it has to finalise next year. These processes have always been wrapped up in the following year. The Department insisted that it was reporting on the first two quarters of the last financial year and has published the state of the tourism report with reference to 2020/21. It stated it was using information provided by Stats SA, which comes with a lag.

It became apparent to the Committee that the Department had to start formulating its reports after Stats SA published its information a year after. The Committee was enlightened the information for the 2023 year would only be available next year, 2024. This meant that the Department could not present 2022/23 information in the current financial year because that information would be available next year.

The Committee did not take kindly to receiving information about the 2020/21 financial year. That was why it decided to give the Department marching orders. It told the Department to go back and prepare a presentation that it requested and that the presentation must have a summary, including the 2021/22 information. The presentation must be submitted together with the report. The Committee felt the Department misunderstood it, as it never requested 2021/22 information. It wanted the report on the first two quarters of the 2022/23 financial year. So, it resolved that there was no reason to continue with the meeting because the Minister and Department had misled it.

The Committee also deliberated with the Department on newspaper advertisements and gazettes for the nomination of SA Tourism (SAT) board members. The concern from the Members was that they got shocked when they saw newspaper advertisements for the nomination of board members that were closing on 04 July 2023 instead of the agreed date of June 2023. The Committee then asked for an update on the matter because it contravened the Tourism Act and undermined what was discussed by the Committee. What also irked the Committee was the reappointment of the Department representative to South African Tourism when she was viewed as useless and adding no value to the Department.

Members commented that the process of finalising the appointment of the South African Tourism (SAT) board would not be finalised in August 2023, as the Committee envisaged, and the process should be expedited to look into the affairs of SAT since the entity has been ailing and showing many weaknesses. They stated that it was important to look at the implications of extending the dates for the board's appointment, given what the Committee recommended. Members also wanted to know if the Minister has added additional members to the board, as the Committee recommended it;

Meeting report

Deliberations with the Department on the newspaper advertisements and gazettes for the nomination of SA Tourism (SAT) board members

The Chairperson, in her introductory remarks, pointed out that the Committee was receiving the first and second quarter performance report for the 2022/23 financial year after it had debated the budget of the Department and submitted it to Parliament for approval, with conditions that no more money should be transferred to the South African Tourism (SAT) by the Department. She indicated that a portion of the money was transferred, but she was unsure if it was 53% of the budget already transferred to the SAT. She stated she has been interacting with the Appropriations Committee Chairperson on the matter. Parliament has considered and adopted the budget with the seriousness it deserves. She also noted the advertisements for the nomination of board members were shocking because they were supposed to be closing in June 2023, but the Committee was surprised to learn they were closing on 04 July 2023. So, she asked for an update on the matter because it contravened the Tourism Act and undermined what the Committee discussed regarding the matter. The advertisements were placed in the newspaper for two months instead of one month as stipulated in the Act. It appeared now that the Committee was playing a poppiehuis and not taken seriously by the Department. She then noted the Department for seconding someone to the board of the SAT.

Mr Victor Tharage, Director-General, Department of Tourism (DT), in his explanation of gazetting the advertisement for the second time, said that section 13 3(b) of the Act requires that the notice should specify a notice of at least 30 days for nominations to be submitted to the Minister. That meant a minimum of 30 days. In this instance, the notice on the gazette has to be published as well. He also mentioned a recommendation had been made to the Minister for the appointment of Ms Nonkqubela-Silulwane to the SAT board as a representative of the Department, as she served on the previous board.

The Chairperson pointed out that the Act talked of at least 30 days, meaning that the 30 days are not exceeded. She said that the Department had shown the Committee the middle finger. She was finding it hard to understand why the DG was telling the Committee the person appointed to the SAT board was the very same person whom the Minister indicated to the Committee was representing the Department in the previous board was useless because she was not reporting back to the Department and submitted no reports to the Department so that it could do its oversight. But now the very same person who was not adding value to the Department has been re-appointed.

Ms P Mpushe (ANC) asked the DG to assist the Committee with the Tourism Act section that he took the Committee through, and asked if the seconded person was representing the board, because there was an issue with the board secretary that was to be seconded from the Department. The Committee was clear on that matter. She remarked that the Minister and her Deputy were not assisting the Committee to be taken seriously by the Department. She recounted the meeting when they were debating the budget, where the Committee did not want to approve the budget of the Department.

Mr A Matumba (EFF) said that Members of Parliament represented the people of SA. According to the Act, the Minister has a mandate to appoint board members on time. But now it appeared as though there was a second date for the appointment of board members. Members of the Committee want to see the board running. If the board was not established, no money would be transferred to it. The DG has complained that there has been no proper oversight mechanism from the Department on the board because the person there was doing nothing. But that person has now been re-appointed. This meant no problems would be fixed concerning oversight of the Department over the entity.

Ms L Makhubela-Mashele (ANC) commented that the process of finalising the appointment of the SAT board would not be finalised in August 2023, as the Committee envisaged. The process should be expedited to look into the affairs of SAT, since the entity has been ailing and showing many weaknesses. It was clear the board would not be active before the elections. In the report to be submitted to the National Assembly, she suggested that the Committee wished the appointment of the SAT board was expedited because no clear reasons have been mentioned about the extension date for the appointment of the SAT board members.

Ms S Xego (ANC) stated that it was important to look at the implications of extending the dates for the board's appointment, given what the Committee recommended. Regarding the representative of the Department on the board, the Committee wanted to address the principle that there should be someone. The assessments and utterances about the representative of the Department in the previous board were from the Department, not from the Committee. What the Department has said to the Committee has posed some serious questions.

Ms M Gomba (ANC) said that the extension of the date by the Department was unlawful. She wanted to know if the Minister added additional members to the board, as the Committee recommended. She remarked that the pace of the Department and SAT has been very slow in improving the number of tourists visiting the country.

Ms H Ismail (DA) wanted to understand why a person viewed as useless has been re-appointed and asked where this person was in the Department; she wanted reasons for the second gazette; and asked what the new actual date would be.

Minister of Tourism, Ms Patricia De Lille, agreed that there was a second gazette. On 21 April 2023, the SAT board was dissolved. Then, on 23 April 2023, the advertisement appeared in newspapers even though it was not gazetted. She stated she asked the DG not to do another gazette. The process had to be corrected. This meant the advertisement had to be redone plus the gazette, hence the second gazette. When the board would be fully constituted and functioning, she indicated that she consulted with the State Security Agency for the vetting of the 11 to 13 board members, and it advised her the process would take between 30 to 60 days to be completed. The Cabinet consultation process on the matter would also take 30 days.

The Chairperson said that the DG had read, to the Committee, the things that were not in the Act, thereby making Members stupid and insulting their intelligence. The Committee has been vindicated. It has become clear that the DG was not taking the Committee seriously. It takes only one sitting of Parliament to amend the appropriation, not to transfer money to the Department. The Deputy Minister has, on many occasions, asked the Committee to be lenient on the Department and to give it a chance, and focus on the SAT. The Committee had to withdraw the ATC’ed report and amend it in the Portfolio Committee. The DG has been testing the Committee and people would be interpreting the work of the Committee wrongly.

Minister De Lille also mentioned that the representative of the Department was part of the board that got dissolved on 21 April 2023. She had consulted with the DG on the idea of the Portfolio Committee, of having a Department representative on the SAT board. Now, going forward, the Department had to institute standard operating procedures for any member representing the Department. It would be stated in the appointment letter that, before any meeting of the SAT board takes place, the agenda should be sent to the Minister and DG by the representative of the Department and go to the meeting with a mandate. Within five days after the board meeting has taken place, the representative of the Department must report to the DG and Minister about the outcome of what was discussed in the board meeting. A report must be submitted even to the oversight committee of the Department that does work on the SAT. She said that she had seen the report of the oversight committee and the issues it has raised about the SAT. She admitted the process that has been started now would at least delay the appointment of the board by another month. An administrative process was not done properly. It was now being corrected because the advertisement and the gazette went out simultaneously. When the board would be fully constituted and functioning, she indicated that she consulted with the State Security Agency for the vetting of the 11 to 13 board members and that it advised her the process would take between 30 to 60 days to be completed. The Cabinet consultation process on the matter would also take 30 days.

Mr Tharage apologised to the Members, stating there was no intention to undermine the Committee at all. It was just his interpretation of what was contained in the Act. He said that there was an administrative challenge that happened in the advertisement that went out. The advertisement was supposed to appear in two national newspapers and government gazette, but it appeared in only one, the Sunday Times. The gazette was not going to be able to go through on 09 May 2023, but only on 06 July 2023. If the second gazette was not done, the whole process was going to be null and void because no due processes were followed. Concerning the Department representative on the SAT board, he said that the person tendered her resignation before the board got dissolved and left. Previously, there was no interface between the Department and person representing the Department on the board, and that representative was not giving any feedback to the Department. With the new operating standard procedure, the representative would have a mandate and be expected to give feedback to the Department about the outcome of the board discussions. He further stated that the oversight committee within the Department was getting documents from the board: annual reports, quarterly reports, etc. The oversight committee always goes through these reports in detail to see if everything done has been in line with the policy, before they were submitted to the Minister.

Ms Makhubela-Mashele stated that the DG had previously overseen almost two board appointments. It was clear some of the technical errors were done deliberately. The process now has got to do with correcting the first technical error, and the technical support has to come from the DG. The DG was the one failing the Department. She commended the Minister on the standard operating procedures regarding the person representing the Department on the SAT board. Therefore, the Act should be amended because the DG stated the person representing the Department was not mandated to give feedback to the Department.

Ms Mpushe wanted to know where the Department's oversight committee was when things were falling apart because the DG and Former Minister indicated the Department representative was not doing her work. She suggested that there should be consequence management for administrative errors. She then agreed with Ms Makhubela on the deliberate errors to delay the process but said there could also be a conflict of interest on the side of the DG.

Minister De Lille told the Members that all the reports of the oversight committee within the Department would be sent to the Committee.

Ms Gomba asked what the terms of the acting board were and if the numbers were still within the law. She wanted to know if the additional numbers to the board have been considered as per the recommendations of the Committee.

Minister De Lille said she would consider additional numbers to the SAT board and report back to the Portfolio Committee.

Ms S Maneli (ANC) remarked the intention has existed to collapse the entire process of having a fully constituted and functional SAT board before the Committee’s term expires. She indicated that it might be better to leave the matter, as it was so that whoever comes after the general elections could appoint a new board. She wanted to know about the costs of the advertisements, because the norm has got to do things twice; she wanted to find out the reasons in the resignation letter of the person who was representing the Department and the reasons for re-appointing the very same person who was never interested in that position. Lastly, she asked why the position could not be given to a person who showed interest in it.

Ms Ismail enquired why the oversight committee allowed the entity to do as it pleased. She wanted to understand what was being done to address the matters in terms of consequence management.

Mr Matumba remarked the Department was battling when it comes to oversight because the DG has made it clear he has no powers when it comes to oversight. But now the DG has taken the Committee through the proper oversight mechanism within the Department. Therefore, it has become clear that the Department was failing the SAT, and it was distancing itself when the entity faced the music. He suggested that the Committee should be provided with conditions on the interim board, including timeframes. He then wondered how tourism was going to recover from Covid-19 if the SAT was not in order.

Ms Xego commented that, what the Minister said to the Committee, on standard operating procedures and oversight methods within the Department, was an indication that she was trying her best to improve the Department and take it in the right direction.

The Chairperson enquired if the newspaper advertisements were not constituting fruitless expenditure on the side of the Department. She then pointed out that, during the first leg of the nominations, the website of the Department has shown many weaknesses. The contact person written on the advertisements was not reachable. The nomination forms were not there, but only available on Google. The consent forms were outdated. She stated that there were issues of competency in the Department, leading one to ask oneself if the accounting authority of the Department knows his/her responsibilities so that the Department could function better. The problems were still existing.

On resignations and reappointments, she said that it was fallacious to say that there was no policy regarding the matter of providing feedback by the Department representative in the SAT board because, when one has been assigned a responsibility, they have to provide a report back to the person who has assigned a responsibility. She wanted to know where the Department's oversight committee was deriving its mandate from and where it had been all along. She warned the Minister that she would always be at loggerheads with the Portfolio Committee if she allowed the DG to mislead her. She indicated she agreed with Members of the Committee when they raised matters on consequence management. She noted that the Department was deliberately not applying the prescripts of the Act when it was convenient to and suited it, but it would run to the Act when things were not on its side. The Chairperson further informed the Department that a case had been opened at the Cape Town Police Station, against Ms Kholeka Zama, for lying to Parliament. One of the Members saw it fit after consulting with their caucus to go and open a case against Ms Kholeka Zama. This was bordering on the seriousness of the Parliament meetings. The Committee is a microcosm of Parliament. Parliament and its rules guide everything that the Committee does. As Members of the Committee, they were not happy with the Department because it was ailing and not executing its duties.

Minister De Lille stated that the secondment to the board could be changed if the Committee wanted that. She received the resignation letter from the board member on 11 April 2023, after serving on the board from 26 October 2022. Most board resignations happened during April 2023. She said that she would institute an enquiry on consequence management to see if there has been wasteful and fruitless expenditure around the advertisements, because the AG would pick it up. She also stated that she wanted the DG to be held accountable because three months were enough for her to get on top of the issues. The Minister said that she would be in consultation with the Presidency and Government Communication and Information Systems (GCIS) because she has to present her 100 days report. Further, she has received seven priorities from the President and the Deputy President that she has to report on monthly to the President and the Department of Planning, Monitoring and Evaluation (DPME), and such things should be ticked as having been achieved in six months. That information would be shared with the Committee. She stated that she had a meeting with the Department about achieving the five-year plan and ensuring the current APPs were designed to reach the targets. In addition, on issues of capacity, she stated that she was meeting with the DG bi-weekly to discuss stumbling blocks, and meeting weekly with the Deputy Minister. Concerning SAT, she said that the vacancies were contributing negatively to how things were done in the entity. She said she had recently met the board to discuss what it was doing with the vacancies. The entity would be meeting with a recruiting agency about advertising the positions. The following vacancies would be advertised: CEO, CFO, CMO, CSO, Head of Internal Audit, and Chief Bureau Head. These acting positions were leading to weaknesses within the entity. Moreover, she mentioned that she was managing the request for international travel by SAT. There has been a Memorandum Of Understanding (MOU) from National Treasury to all national Ministers to check compliance with cost-containment measures, to avoid possible irregular, fruitless and wasteful expenditure. All the Ministers were expected to report to Treasury on these cost-containment measures. She emphasised that there was no intention to undermine the Committee because, going forward, she would like to work with it. There were many issues where the Department was putting systems in place to improve performance within it.

Department of Tourism on Q1&2 2022/23 Performance
The DG began taking the Committee through the presentation.

Ms Gomba asked the DG which financial year he was reporting on because he was talking of 2020/21 and 2021/22, whereas he was supposed to speak on the 2022/23 financial year.

Mr Tharage said it lags behind because of the data processes with Stats SA, which the Department has to finalise next year. All the time, they have been finalised in the following year. It would also include data that would have been dated 31 March, which could have been used subsequent to the end of that financial year. He said that the Department was presenting first and second performance of 2022/23, but the data that has been referenced would be coming from the year prior to the year of reporting, because the Department was concluding a report that deals with the state of tourism, and that year could have closed 31 March of the previous year, 2021/22. The year that was referenced in the report was 2021. It is something that the Department did not have control over because it was the sources of data it had to use.

Minister De Lille said that the requests from the Committee were for the Department to present the first and second quarter performance of the last financial year. The data for quarters one, two, three, and four of the last financial year had been put together by 31 May, for auditing by the AG. That information should be available unless the DG indicated that the last financial year's first and second quarter performance was not audited. The Department was talking about the 2021/22 financial year. She said that her understanding was that the Department was in the meeting to present quarters one and two of the 2022/23 financial year.

Ms Aneme Malan, DDG: Tourism Research, Policy and International Relations, DT, said that the Department was reporting on the first two quarters of the last financial year. The Department has published the state of the tourism report with reference to 2020/21. It was published at the end of September 2022, but the reference period was 2020/21. The reason was that the Department uses information provided by Stats SA, which comes with a lag.

Dr Sibusiso Khuzwayo, Committee Content Advisor, suggested that the Department should take the Committee through the process of collecting and collating data, and release of statistics – after which the Department would start to develop the report because if the report comes as 2021, it still sounds as misleading. That is the problem, because it has to start formulating these reports after Stats SA has published its information which is a year before. The Department has been using information for a year before. For example, the year is now 2023, and the information for this year would only be available next year. This means that the Department could not present 2022/23 information in the current financial year because that information would be available next year. This was a technical matter regarding how information is released, after which they start developing their reports.

Ms Mpushe remarked that the Department was presenting information provided by Stats SA.

Mr Matumba said that there was a gap of 2021/22. He wanted to find out how much the Department relied on Stats SA research when it was spending more than R1 billion on tourism research. He asked if the Department was not supposed to have its own data, because there would be a time when Stats SA would not be available to release data due to governance issues.

Ms Makhubela-Mashele asked the DG and Ms Malan to empower the Members through the reporting process because the Committee raised concerns about data release last time. The tourism environment is dynamic, because, by the time one reports on data, the environment would have changed already. The Department at that time indicated it did not have capacity to collate its own data. It cannot be Stats SA that could empower the Department with statistics. The Department should have a backup while awaiting information from Stats SA. What hinders the Department from drawing up a questionnaire as Stats SA does to compare? In future, what is the process that has been put into place to ensure you rely on updated data even though it is not official so that the Department could use it for planning?

Ms Gomba said that the Department should develop its own systems that would help collect its own data because it was coming to the Committee with outdated data for 2020/21. Shen then asked how the AG would analyse the Department's performance when its findings discovered that the Department came with old data.

The Chairperson recounted that, in meetings with the previous Minister and the Department, she had raised a point that in terms of the Act – that the Minister should establish the National Tourism Information and Monitoring System for collecting, recording, managing, analysing and disseminating information and data on tourism and monitoring trends in tourism. The Department officials in that meeting stated that such a system already existed in the Department. The problem that the Committee was faced with was that the report on the information of this year would be available next year. The Committee this year was being presented with information on the financial year before the last one. For her, the lag meant that the presentation to the Committee carried information from 2020/21. Therefore, there was no reason to continue with the meeting, because the Minister and Department have misled the Committee. All the reports to the parliamentary committees have to be signed by the political heads of the departments.

Minister De Lille stated that she completely understood where the Committee was coming from. She said that Stats SA monitors tourism trends, and the Department has a different accounting system. Every year, the APPs of the Department get approved by the Committee. The APPs have targets. Sometimes, there are overlaps in the work between Stats SA and Tourism Department. Recently, Stats SA reported during the first quarter of 2023 about the arrival of tickets between January 2023 and March 2023 that one million people had arrived in the country. The Department, not Stats SA, monitors quarterly performance. She then asked that the Department be given time to go back and rectify the problems.

Mr Fish Mahlalela, Deputy Minister of Tourism, explained that the Department was not 100% reliant on Stats SA to collect information for the state of tourism. The Department was doing its own work and then combining that information with that from Stats SA. The matter that was being dealt with in the Committee was something that should have been dealt with during July of 2022, but the Committee never invited the Department to present this information.

Ms Mpushe stated that the Deputy Minister was out of order because the Committee was dealing with the performance of the first two quarters of the 2022/23 financial year. She remarked that there was a level of unprofessionalism within the Tourism Department.

Deputy Minister Mahlalela said that the meeting dealt with the APPs approved by the Committee last year, and that was what the Department presented.

The Chairperson pointed out that the Committee was receiving a report for 2022, and the Committee Content Advisor indicated that the 2023 information would be gotten and presented in 2024 – which meant the Committee was receiving information of the 2021/22 financial year. In front of the Members, there is a 2020/21 report. It can never be correct that the Committee did not summon the Department during 2021/22. This was a bad reflection on the side of the Department, including the competency that the Committee has been complaining about. The utterances of the Deputy Minister were insinuating that the Committee did not know what it was doing. She then proposed that the Minister should soon establish the National Tourism Information and Monitoring System to monitor tourism for the Department, on behalf of the Minister, so that the Committee could have information on tourism at its fingertips and not rely on Stats SA. For instance, during the Tottenham Hotspurs debacle, the previous CEO talked of aggravated audiences on television, but Tourism SA disputed that. It was then the Committee that felt that the Department was not only failing South Africans but had serious capacity challenges, because previous Ministers failed to establish the National Tourism Information & Monitoring System. She wondered what was being done with the R1 billion research budget.

Minister De Lille remarked that the financial year of 2022/23 ended end of March 2023. She said that it was clear that the Committee wanted to know what the Department had done during the first two quarters of last year. The information on what was done during the first two quarters of 2022 was submitted to the AG for auditing. So, the information was available. She said that the Department made notes in its submission to the AG regarding an increase of 39% in advertising costs. She then proposed that the Department be allowed to go back and compile a report on what it did during the first two quarters of last year. It has to look at the systems of reporting and establishment of the National Tourism Information and Monitoring System to see if it was in line with regulations of the Act, understand why it has never been established and what would be done to establish it.

Ms Maneli remarked that the Committee has called the Department to appear before it many times, but it got sent back because there was no political leadership. She suggested that the Committee allow the Department to do the presentation, to avoid backlogs.

Ms Mpushe proposed that the Committee should get details of what was going to be presented in the meeting in the form of a summary, and suggested that the Committee should not continue with the meeting.

Ms Makhubela-Mashele said that the Committee could not change what the Department had presented because it was just compliance and reporting.

Mr M De Freitas (DA) said that he was surprised by the utterances of the Deputy Minister that the Department relies on the Committee for information.

Mr Matumba said that tourism was dynamic and required dynamic people. Having the 2021/22 state of tourism information was not helping this current year. The reports were brought to the Committee, with no political heads and principals present. That was why the Department was sent back many times, because the Committee could not consider reports without political heads.

Ms Xego proposed that there should be a background talk between the political head of the Department and that of the Committee, on what was expected to be presented to the Committee – just to make things easier to follow. The Committee should also get a presentation and a report. The presentation is about the facts of the report. She agreed with the Minister on the idea that the Department should go back to rectify things and come back with the right information.

Closing Remarks by the Chairperson
The Chairperson said that the Department misunderstood the Committee, as it never requested 2021/22 information. It wanted the report on the first two quarters of the 2022/23 financial year. Further, the Committee has been acting within the prescripts of the law and rules of Parliament to drag the previous Minister to account to the Committee. Members were lamenting that the Department could not present was not the design of the Committee. The previous predecessor was available to account to the Committee during the Tottenham Hotspurs saga because it was of interest to her. The Department has been invited to the Committee many times. Sometimes, the Deputy Minister would come alone and not be able to respond to questions from the Members because it was not within his powers to answer those questions. She then proposed that the Department go back and prepare a presentation as requested by the Committee. The presentation must have a summary, including the 2021/22 information. It must be submitted together with the report. She then told the Minister that the sooner the National Tourism Information and Monitoring System was established, the better.

Relying on information from external forces would never be the same as what the Department was collating. The Act empowers the Department to collect its own information. She also reckoned that Business Tourism SA would always be at loggerheads with the Department and SAT because it has its own way of collecting and collating data. It even knew that SA was red-flagged in the country where Tottenham Hotspurs is from. Had the National Tourism Information and Monitoring System been established, it would have cleared the information on the Tottenham Hotspurs saga for the Department. The R1.4 billion allocated for research should be shared with the National Tourism Information & Monitoring System, which must be established because the Act has mandated it.

The meeting was adjourned.

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