Office of the Master of the High Court: Activity report 2007/8

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Justice and Correctional Services

26 August 2008
Chairperson: Mr Jefferies (ANC)
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Meeting Summary

The Committee was briefed by the Master's Office on the activities of the Office over the last year. The report focused on the strategic objectives of the Masters Office, achievements in the past year and areas that needed improvement. The objectives included increasing accessibility to the Office, especially the rural poor and ensuring that services were provided by legal qualified professionals who could offer better service. In future all appointments would require an LLB degree or higher. The objectives were also to be enhanced by reforming legislation and automating business procedures to ensure better delivery. There was a need for increased supervision of liquidations and sequestrations, and there was also a need for better communication and public education. The Master was looking at automating manual systems and standardising policy systems and securing a uniform approach to management. The Guardian's Fund was almost fully automated, and this had reduced incidences of fraud and corruption. The Guardian's Fund was also to open offices in other areas. The Master had achieved good compliance with black economic empowerment and employment equity, and was interacting with the Department of Trade and Industry in preparation for the new business rescue schemes.

Members asked questions about the qualified audit report in the previous year, identifying numerous issues, and pointing out that this was the second such qualified report. They asked what actual steps had been taken to ensure full compliance in this financial year, and were assured that the figures were in the process of being verified, that a disaster recovery plan was put in place, and that the Office was working with South African Revenue Services. Further questions related to what would be done about staff who might not have a formal qualification but did have experience, the fact that the degree itself did not prepare people for the technicalities of the administration, and whether skilled people were being lost because the Department was failing to look after them. Questions were asked also on the turnaround times of the administration, the problems with the high vacancy rates, many of which had been foreseeable, the proactive prevention measures that would ensure that this situation was corrected, and the ability to retain staff.

Meeting report

Office of the Master of the High Court (the Master): Activity report
The Acting Chairperson, Mr J Jeffery (ANC) tendered apologies on behalf of the Committee Chairperson, who was ill. He noted that the Committee would hear a briefing on the activities during the past year of the Office of the Master of the High Court.

Mr Lolthiam Basson, Deputy Master, Office of the Master of the High Court, apologised for the absence of the Chief Master. He noted that he would focus on the strategic objectives, the achievements during 2007/08 and areas of improvement

Mr Basson stated that the Master's branch had a budget of R240 million, and was embarking on a programme of training legal interns and developing skills for the future. There had been particular progress in the fields of customary law reform and insolvency

The strategic objectives of the Master’s office included ensuring accessibility to all, especially the rural poor. In order to do so, it was paramount that service be provided by legally qualified professionals. Therefore when appointments were made, the minimum qualification would be an LLB degree, higher if possible. The objectives would be further enhanced by reforming legislation and automating business procedures to ensure that they were delivered in the most cost-efficient and effective manner. He also emphasised the need to provide effective supervision of liquidations and sequestration processes by enhancing legislation and developing appropriate monitoring capacity for protecting the interests of the vulnerable and the poor. The deliverables were described as increased proximity and easier access to services, improved quality of services and public education and communication.

In order to do this it was envisaged that more mobile offices and sub-offices be established, that there be a reduction in the numbers of untrained staff, that there be a better monitoring and evaluation system, and reduced turnaround times. The Master was looking at automating manual systems and standardising policy systems and securing a uniform approach to management. 

The most significant achievement was the near full –automation of the Guardian’s fund. Only Pretoria, the largest office, was not yet fully automated. Mr Basson digressed briefly to point out that where the automated system had been implemented there had been no recorded incidents of fraud or corruption.

The Master was also looking at the extending the Guardian’s fund to other places, as set out in the presentation (see attached document) to improve access to people in those areas.
Mr Basson further noted significant improvement in terms of accommodation in the Pretoria and Johannesburg offices, that all business procedures had been documented and simplified and that the department complied with Black Economic Empowerment (BEE) and Employment Equity (EE) codes, especially in insolvency. It was also interacting with the Department of Trade and Industry regarding business rescues, which were to be implemented under the forthcoming Companies Bill legislation.

Mr Basson also identified areas in need of improvement, such as the continuing need to improve access to the Guardian’s fund.

Discussion
Adv C Johnson (ANC) noted that a qualified audit report was issued with regard to the Guardians Fund. The problems identified included non-compliance with the Income Tax Act, non-compliance with instructions from the National Treasury, no disaster recovery plan in place, and no risk assessment. She enquired whether steps had been taken to address these weaknesses.

Mr Basson replied that final findings had not been released and that he did not wish to pre-empt the findings, but stated that he expected a much improved situation in the current financial year.

Ms Johnson sought further clarification, pointing out that the Master's Office had received qualified audits in 2005/06 and 2006/07.

Mr Jeffery said that to wait for the 2007/08 audit would be tantamount to asking the Committee to have faith that all would have been sorted out. He asked what actual steps had been taken to ensure an unqualified audit this financial year.

Mr Basson responded that the start of the problems lay with the opening balances of the Guardian's Fund. To correct this, measures had been put in place to fully verify data, and he was confident that such measures were reliable, barring perhaps the Pretoria office, which was still in the process of moving towards a fully automated system. He further stated that the Master had addressed the concerns around a disaster recovery plan, and that the Office was working with South African Revenue Services (SARS) on the latter concern.

Adv L Joubert (DA) noted that the LLB was the entry level qualification, but he stated that a pre-graduate LLB did not even require to have completed a course in administration of estates.

Mr Basson responded that the Guardian's Fund staff was divided between those with accounting and legal skills. The accounting side would have staff with an accounting qualification, whilst those on the legal side would possess an LLB.
 
Adv Joubert enquired about the status of existing staff who did not have an LLB but may be very experienced, and whether they would be disadvantaged by lacking this qualification.

Mr Jeffery expanded upon this by asking whether only new staff would be required to have an LLB, or whether conditions would be attached to all staff.

Mr Basson explained that the LLB would a prerequisite for new staff members. However, under the process of transformation two to three years ago it was identified that several of the staff were highly experienced but lacked a formal qualification. He stressed that this represented only a small percentage of the staff. When they were eventually replaced, their replacements would require a degree, but they were exempted from this requirement. He stated that the LLB was now needed for the rank of estate controller, but that it had long been a statutory requirement for the rank of Assistant Master.

Mr Jeffery pointed out that a degree by itself meant nothing, and that the administration of estates was a very technical exercise. He thought that the true question was whether the Master's Office was losing a body of skilled people because the Department did not look after them properly. He wanted to know whether Mr Basson was confident that that older staff without qualifications were not being discriminated against because they lacked qualifications.

Mr Basson admitted he was in a difficult position as the Office was indeed losing skilled people, but at this point the Office was focused on the qualification aspect. He did take to heart what Members were saying. He added that in respect of those without formal qualifications, opportunities were presented for further study.

Mr Jeffrey replied that a 50 year old with a further 10 or so years left in the public service may quite reasonably not wish to pursue a three year course of study.

Adv Joubert asked a question regarding turnaround times of administration of deceased estates.

Mr Basson emphasised that the Master did not do administrative work, but was only involved in three to four key points in the process; namely, the appointment of the executor, the examination of liquidation and distribution accounts, and releasing the estate for distribution. The Master's Office was essentially dependent on how fast others attending to the actual winding up and drawing of the accounts could work. He did point out that an Executor was not entitled to remuneration until his duties were complete, and that this would provide an incentive to speed up the process. He could not give exact turnaround times but said that the newly computerised system would be better able to monitor the turnaround times. He did point that there were statutory time limits in place. The executor had six months to lodge the liquidation and distribution account. The Master then had two months to approve and release the estate, not excluding the 21 days that the accounts were to lie open for inspection. He admitted that the Office was under significant pressure because of a lack of manpower, but that the situation had improved. He stated that 90 to 95% of those who did approach the Master’s office with an issue were helped on the same day.

Mr Jeffrey stated that that vacancies in the Johannesburg, Durban and Cape Town Master's offices, at the highest level, were problematic. The Cape Town office had had a vacancy for nearly a year and he pointed out that the retirement of the Masters was foreseeable, so it was not as if they had suddenly left. The extended recruitment process suggested bad planning as well as a lack of a proper succession plan.

Mr Basson concurred with most of what he said and agreed that it was an unacceptable situation. The Master's Office would be concentrating on stabilising the situation. 

Mr Jeffery wanted to know to what proactive preventative measures would be put in place.

Mr Basson responded that measures would be put in place and that he would report back at a later date.

Mr Jeffery asked about the ability to retain staff.

Mr Basson said this was a problem. Although some posts had been upgraded, there was only so much the Office could reasonably offer by way of salary, which may not be sufficiently attractive. However, staff turnover had slowed down in recent years.

The meeting was adjourned.

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