Basic Education 2019BRRR

6. The Budgetary Review and Recommendation Report (BRRR) of the Portfolio Committee on Basic Education on the performance of the Department of Basic Education for the 2018/19 financial year, dated 22 October 2019

The Portfolio Committee on Basic Education, having considered the performance of the Department of Basic Education, reports as follows:

1. Introduction

  1. Purpose of the BRRR

In terms of Section 5 of the Money Bills Amendment Procedures and Related Matters Act, No. 9 of 2009 the National Assembly, through its Committees, must annually compile the Budgetary Review and Recommendation Reports (BRRR) that assess the service delivery performance of departments given available resources. Committees are also expected to provide an assessment of the effectiveness and efficiency of the Department’s use of available resources, and may include recommendations on the forward use of resources. In this regard, the BRRR is a source document for the Committees on Appropriations when considering and making recommendations on the Medium Term.

1.2 The role and mandate of the Portfolio Committee

The Portfolio Committee on Basic Education as an extension of the National Assembly is mandated by sections 55 and 92 of the Constitution of the Republic of South Africa (Act 108 of 1996) and the Rules of Parliament to oversee the activities and performance of the Department of Basic Education and its two statutory bodies, namely, the Council for Quality Assurance in General and Further Education and Training (Umalusi) and the South African Council for Educators (SACE). In this context, the Portfolio Committee on Basic Education focuses its work within the five constitutional mandates of Parliament, which are to process and approve legislation, conduct oversight, ensure public participation, process international agreements and facilitate co-operative governance. In addition to performing these constitutional mandates, the Committee engages in various activities and programmes focussing on the development and delivery of quality public education to all South Africans. The Committee also deals with matters referred to it by the Speaker or the National Assembly.

1.3 Core functions of the Department of Basic Education

The Department of Basic Education (DBE) derives its mandate firstly from the Constitution of the Republic of South Africa (1996), which requires education to be transformed and democratised in accordance with the values of human dignity, equality, human rights and freedom, non-racism and non-sexism. The Constitution guarantees access to basic education for all, including adult basic education.  Secondly, the National Education Policy Act, 1996 Act 27 of 1996 (NEPA), inscribes into law the policies for the national system of education, the legislative and monitoring responsibilities of the Minister of Education, as well as the formal relations between national and provincial authorities. In terms of the NEPA, the DBE’s statutory role is to formulate national policy, norms and standards as well as to monitor and evaluate policy implementation and impact.

In line with its mandate, the Department has a vision of a South Africa in which all people will have access to lifelong learning, education and training opportunities, which will, in turn, contribute towards improving the quality of life and building a peaceful, prosperous and democratic South Africa.

In fulfilling its mandate over the next five years, the Department is guided by the 2014-2019 Medium Term Strategic Framework (MTSF) designed to reflect the actions outlined in the National Development Plan (NDP).

1.4 Processes followed by the Portfolio Committee in arriving at the report

In compiling its BRRR, the Portfolio Committee on Basic Education assessed the performance of the Department of Basic Education with reference to the following:

  • The strategic priorities and measurable objectives as set out in the 2018/19 strategic plan.
  • Expenditure trends drawn from the reports of the National Treasury;
  • The 2018 and 2019 State of the Nation Address priorities;
  • The reports of the Auditor-General of South Africa and the reports on the 2017/18 Budget Vote;
  • The financial statements and annual report briefings, in terms of Section 65 of the Public Finance Management Act No. 1 of 1999, which requires the Ministers to table the Annual Reports and financial statements for the Department and public entities before Parliament.
  • Findings of the Portfolio Committee’s oversight visits, including quarterly briefings.
  • External sources assessing the performance of the Department.

The briefings on the annual performance and financial statements of the Department and its statutory bodies took place on 08 - 10 October 2019 in Parliament. The Portfolio Committee also met with the Auditor General on the audit outcomes of the Department, the Financial and Fiscal Commission (FFC) and the Audit Committee of the Department of Basic Education on 08 October 2019.

2. Overview of the key relevant policy focus areas

2.1  The National Development Plan (NDP), Vision 2030

The NDP’s vision for 2030 is that South Africans should have access to education and training of the highest quality, characterised by significantly improved learning outcomes. The NDP sets out, inter alia, priorities, targets and actions to improve the quality of basic education. Key targets for 2030 include improved retention of learners and improved learning outcomes. Quality targets cover areas such as literacy, numeracy and the number of learners passing Grade 12 at Bachelor level.

2.2  The Medium Term Strategic Framework

The strategic goals of the Department of Basic Education (DBE) in 2018/19 were anchored on the 2014 – 2019 Medium Term Strategic Framework (MTSF) and the sector plan, Action Plan to 2019 - Towards the realization of schooling 2030. In terms of the MTSF, the DBE is responsible for Outcome 1 (Quality Basic Education) and collaborates with other Departments on Outcome 7 in respect of Infrastructure and the National School Nutrition Programme (NSNP), Outcome 13 with regard to Early Childhood Development (ECD) and Outcome 14 in respect of Fostering Constitutional Values and Promoting Social Cohesion. The overarching goal of the education sector remains to improve learner performance across all grades. The Action Plan outlined 27 goals which the Department aims to accomplish.

The MTSF outputs for the sector and the Department’s plans are aligned to and guided by the National Development Plan. The sector also has non-negotiables to focus on other areas inadequately covered in the MTSF.

The Department’s Strategic Outcome Oriented goals per programme are aligned to the following six MTSF sub-outcomes:

  • Improved quality teaching and learning, through the development, supply and effective utilisation of teachers;
  • Improved quality teaching and learning, through the provision of adequate, quality infrastructure and learning and teaching support materials;
  • Improving assessment for learning to ensure quality and efficiency in academic achievement;
  • Expanded access to ECD and the improvement of the quality of Grade R, with support for pre-Grade R provision;
  • Strengthening accountability and improving management at the school, community and district levels;
  • Partnerships for education reform and improved quality.

Given that basic education is a concurrent function requiring a cooperative and more integrated approach, a significant part of the Department’s work is the alignment of the work of the Provincial Education Departments (PEDs)’ Strategic and Annual Performance Plans with the sectoral mandate articulated in the NDP and the MTSF.

2.3 2018 State of the Nation Address (SONA)

      The 2018 SONA outlined three policy objectives pertaining to Basic Education, as follows: 

  • The continuation of the priority to build modern schools replacing mud structures and other inappropriate buildings through the Accelerated Schools Infrastructure Delivery Initiative (ASIDI), to give learners dignity;
  • The extension of basic services such as water, sanitation and electricity, and
  • Increased focus on Mathematics and Science.

In line with National Treasury appropriations, the Department. of Basic Education was allocated R23.7 billion for 2018/19.  Spending on infrastructure took up most of the Department’s budget over the medium term. A total of R3.8 billion was allocated to the School Infrastructure Backlogs Grant (SIBG), also known as the Accelerated Schools Infrastructure Delivery Initiative (ASIDI), in 2018/19 to complete the remaining projects. The total allocation for the Education Infrastructure Grant (EIG) was R9,9 billion in 2018/19.

2.4  Strategic Goals of the Department of Basic Education for 2018/19 financial years

Key priorities of the Department for 2018/19  focussed on  improving school infrastructure; improving curriculum delivery through high quality learning and support materials (LTSM);  provision of support and resources to improve skills in critical subjects such as Mathematics, Science and Technology; increasing the number of learners completing Grade 12; providing  Second Chance Matric Program; providing support to learners with severe to profound intellectual disabilities through a newly introduced conditional grant; ensuring the adequate supply of quality teachers; assessing the quality of teaching and learning; strengthening learning and teaching in the early grades; improved accountability across all levels of the basic education system; continuing to provide meals to learners; and, improving access to and the use of ICT in basic education.

The priorities for 2019/20 remain largely unchanged, with notable additions being to increase priorities to focus on Rural Education through improving literacy, numeracy and reading skills as well as striking a balance in curriculum, books and curricular activities to improve learner performance. The Department also aims to focus on the monitoring of the implementation of lesson plans by teachers.

3. A summary of key Performance Recommendations of the Portfolio Committee in the 2018 Budgetary Review and Recommendation Report 2018

  1. Progress report on the implementation of the Audit findings of the Department of Basic Education

3.1.1 Finding 1: Immovable tangible capital Assets: Overstatement of capital assets and capital expenditure as well as understatement of goods and services expenditure.

DBE Action: The Department reported that monthly reconciliations on expenditure were regularly done and the values of completed projects were only based on actual payments processed through BAS with provision for both Accruals, Retention, PSP & Implementing Agents fees. The Department further stated that it performed the split between operational and capital expenditure for the period since the inception of the Accelerated School Infrastructure Delivery Initiative (ASIDI) in 2012. This was done with the hope that this will be completed on time for accurate disclosure in the 2019/20 Annual Financial Statements

  1. Finding 2: Commitments: Misstatement of commitments due to insufficient audit evidence provided.

DBE Action – In previous years, projects formally allocated to Internal Audit's were classified as approved but not contracted, even if these were not yet awarded. The Department reported that all project values previously recorded as “Approved but Not Contracted” in the Commitment Register were removed with effect from the 31 March 2019. The commitment values are strictly for projects with award tender values. All estimated disbursement values to the end of 31 March 2019 are replaced with actual expenses reimbursed to the Implementing Agents.

  1. Finding 3: Contingent Liabilities: Understatement of contingent liabilities

DBE Action – The Department has corrected the 2018/19 amounts for disclosure during the audit and the interest amounts are now included.

  1. Finding 4: Accruals and payables not recognised: Misstatement of accruals

DBE Action – Classification is determined by the date the invoice is received by the implementing agent. The Department reported that Implementing Agents have been instructed to date-stamp each invoice on receipt and capture this date on their accrual schedule. The Department reported that a letter has been sent to all Implementing Agents requesting that they stamp receipt date of all invoices.

  1. Finding 5: Irregular Expenditure: Non-compliance with the PPPFA when awarding contracts.

DBE Action – Bid Evaluation and Bid Adjudication Committees where supported to the extent that their work has been strengthened. Officials representing the Department in bid committees of Implementing Agents were being held accountable for omissions. The Department interventions are aimed at ensuring that all related irregular expenditure will be disclosed accordingly in the Quarter 2 Financial Statements. Despite efforts taken by the Department in mediating on irregular expenditure, the current Audit Report still reflects irregular expenditure. This is a recurrence of findings of the previous financial year by the Auditor General.

3.1.5   Programme 2: Planned targets were not specific.

DBE Action – The Performance Indicators have been quantified for the 2019/2020 years and beyond.

  1. Programme 3: The reported achievement in the annual performance report did not agree to the supporting evidence provided.

DBE Action – The Department reported that they communicated with relevant programme managers in Provinces to ensure that scripts are identifiable through a name or a code, and also to ensure that they are dated. It was further reported that the Department was encouraging more provinces to take the tests online on the Moodle Platform.

Based on the current audit findings, there are still challenges regarding reported information in Programme 3. These relate to reporting on the number of teachers participating in diagnostic tests.

  1. Programme 4: The reported achievements in the annual performance report did not agree to the supporting evidence provided.

DBE Action – According to the Department, the Project Manager was working more closely with mentors to verify numbers and designation of officials that were targeted for the mentoring support.

  1. Internal control deficiencies, including leadership oversight:

DBE response: The Department reported to the 5th Parliament Portfolio Committee in December that stringent reporting timelines were implemented. Verification reports were sent to Internal Audit to ensure the reliability and validity of the information. Quarter 1 final report was signed by internal audit and its findings were incorporated in the 2nd quarter to validate 1st quarter outputs. Branch reviews were used to highlight, monitor, track and alert programmes on the progress of achieving pre-determined objectives against the planned targets. Branch review sessions were conducted for quarter 1 and 2 whereby the 2018/19 reporting and 2019/20 planning cycle were introduced and discussed in detail. The Technical Indicator Descriptions (TIDs) that were not clear were corrected and edited. Indicators that were deemed not useful by AGSA have been recrafted for the 2019/20 financial year. Despite the Department’s efforts to address internal control deficiencies, the 2018/19 AGSA report indicates that control deficiencies persists.

3.1.9   Inadequate consequence management

DBE response: The Department reported that the Internal Audit Unit would validate plans and procedures, roles and responsibilities of various managers to mitigate risks of non-compliance and review the entire action plan to address AGSA findings. IAU would further investigate alleged and non-adherence to policies and procedures and monetary losses. The 2018/19 audit findings showed a recurrence of this audit finding.

3.2       Responses to key recommendations pertaining to service delivery issues

3.2.1 Together with Provincial Education Departments, address deficiencies in respect of curriculum coverage and textbook retention and retrieval system, as noted by the Auditor-General.

DBE responses: The Department reported that most provinces declared that this area still needed to be strengthened. Most provinces had however begun rolling out a provincially driven strategy to strengthen this area. The Department would ensure monitoring and support of curriculum coverage throughout 2019. Provinces had made an undertaking to comply with the reporting timeframes for the provision of textbook retrieval reports as requested by the DBE.

3.2.2 Strengthen the monitoring of the roll-out of ICT in schools, particularly in rural areas, to ensure that access to ICT resources reaches 100 percent by 2019, as required by the Medium Term Strategic Framework.

The Department would develop a comprehensive monitoring plan for 2019/2020 of the roll out of ICT ensuring that access to ICT reaches 100% in 2019.  Monitoring and support of the roll-out of ICT was completed at 27 schools. The provincial ICT roll-out plans were presented and discussed at the quarterly Heads of Education Committee (HEDCOM) ICT Sub-committee meetings. Provincial implementation plans were supported and complemented by national ICT projects such as the provision of connectivity and hardware to 4 412 schools and the development of 112 titles of state-owned textbooks.

3.2.3 Provide the necessary support to the relevant Provincial Education Departments to ensure effective and efficient utilization of conditional grants. Consider developing clear performance evaluation frameworks for the grants under its control, with well-defined performance indicators that can be tracked consistently across project cycle stages for all provinces and performance indicators should be based on quality, cost and time factors. A process should be put in place to hold to account those Provincial Education Departments that do not comply.

The Department reported that they were in the process of overhauling the evaluation tools and the recommendations made by the Portfolio Committee would be accommodated in the new tools so that issues of quality, cost and duration (time) were taken into account. The DBE’s intervention to assist the PEDs was applicable to all grants. Grant frameworks were being amended.

  1. Put more effective/stringent penalties against Implementing Agents who perform poorly in relation to the ASIDI programme.

The Department reported that addenda were issued and the Memoranda of Agreements (MoA’s) signed with the various Implementing Agents (IAs) to strengthen the Agreements and include punitive measures in case of poor performance. The addenda gave the DBE, or its appointed representative, the authority to take over the projects which were behind schedule, at the cost of the infringing IA. The signed addenda extended the MoA’s to end of Financial Year, 2020/21.

  1.     Improve performance in respect of the indicators relating to the ASIDI programme, namely, completed schools to replace inappropriate structures, provision of water and decent sanitation.

All the water and sanitation projects which were lagging behind schedule in the Eastern Cape and the Limpopo Provinces, were taken away from the non-performing IAs and re-allocated to The Mvula Trust who were performing well with regard to water and sanitation projects.

3.3            Overview and Assessment of Financial Performance

3.3.1    Allocation against Actual Expenditure per Programme for the 2018/19 Financial Year

  •  
  1.  

Expenditure as % of Appropriation

  1.  

ACTUAL EXPENDITURE

  1.  
  1.  
  1.  
  1.  

Administration

476565

471919

4646

99.0%

Curriculum Policy, Support and Monitoring

1 861689

1 802191

59498

96.8%

Teachers, Education Human Resources Development and Institutional Development

1 307146

1 297611

9535

99.3%

Planning, Information and Assessment

12 943527

12734 639

208888

98.4%

Educational Enrichment Services

7110 656

7108 407

2249

100.0%

Total

23699 583

23414 767

284816

98.8%

 

The budget allocation of the Department of Basic Education in 2018/19 was R23.7 billion, which represented a nominal increase of R705 963 from 2017/18. The majority of the budget (80.7% amounting to R19.1 billion) consisted of transfers and subsidies, mainly to provinces and municipalities. This means that the Department had an available budget of R4.6 billion for compensation of employees, earmarked funds, office accommodation, departmental operations and other projects.

Actual expenditure in 2018/19 was R23.7 billion or 98.8 percent of the allocated budget compared to 99.7 percent in 2017/18. The unspent balance of R284.8 million at the end of 2018/19 was more than in 2017/18, when R61.7 million was unspent. The main contributors to the under-spending in 2018/19 were Programme 2 that had spent 96.8 percent and Programme 4 that spent 98.4 percent. Programmes 1, 3 and 5 spent 99 percent, 99.3 percent and 100 percent respectively.

  1.  
  • Programme 1: Administration (Underspent: R 4 646) million) - There were no material variances on this programme.
  • Programme 2: Curriculum Policy, Support and Monitoring (Underspent: R 59.498 million) – The underspending is due to unfilled vacant positions including the Deputy Director posts in the Free State and KwaZulu-Natal. The LTSM electronic system couldn't be procured due to the SITA requirement that the proposal must include budget allocation for the outer years. LSPID grant Compensation of Employees (CoE) constitutes more than 50 percent of this grant. However, the posts for this grant are not permanent. It is for this reason that PEDs struggled to recruit and maintain a full complement of therapists for this project.
  • Programme 3: Teachers, Education Human Resources Development and Institutional Development (Underspent: R 9.535 million) - There were no material variances on this programme.

 

  • Programme 4: Planning, Information and Assessment (Underspent: R 208.888 million) – The projects were estimated at R 230 million. The procurement process was halted due to local content requirements by the Department of Trade and Industry, meaning projects could not be implemented. ASIDI projects in the Eastern Cape were delayed due to stoppage as a results of disruptions by the Eastern Cape Black Contractors Association whereby the association has forcefully demanded that the site be closed and they be given part of the projects.
  • Programme 5: Education Enrichment Services (Underspent: R 2.249 million) - There were no material variances on this programme.                            

3.3.2    Allocation against Actual Expenditure for the 2018/19 Financial Year

ECONOMIC CLASSIFICATIONS

  1.  

Expenditure as % of Appropriation

  1.  
  1.  
  1.  
  1.  
  1.  
  1.  

Current Payments

2 425 848

2 319 321

106 527

  1.  

Compensation of Employees

510 590

491 220

19 370

96.2%

Goods and Services

1 864 862

1 782 685

82 177

95.6%

Interest and rent on land

50 396

45 416

4 980

90.1%

Transfers and Subsidies

19 129 740

19 123 421

6 319

100.0%

Provinces and Municipalities

17 696 148

17 690 158

5 990

100.0%

Departmental agencies and accounts

144 960

144 960

-

100.0%

Foreign government and international organisations

14 374

14 374

-

100.0%

Non-profit institutions

112 129

112 129

-

100.0%

Households

1 162 129

1 161 800

329

100.0%

Payment For Capital Assets

2 143 633

1 971 596

172 037

92.0%

Building and other fixed structures

2 129 753

1 955 637

174 116

101.1%

Machinery and Equipment

7 387

6 946

441

94.0%

Software and other intangible assets

6 493

9 013

(2 520)

138.8%

Payment for Financial Assets

362

429

(67)

118.5%

Total

23 699 583

23 414 767

284 816

98.8%

  1.  

 

  • Compensation of Employees - There were no material variances on this item.
  • Workbooks Project – All vacant posts have been submitted for advertisement by the end of September 2019. A full analysis of spending has been implemented and savings were identified. The Department requested National Treasury approval to redirect savings to fund other priorities within the Workbooks project which were not funded previously.
  • Transfers and Subsidies – The underspending was due to Learners with Severe and Profound Intellectual Disability (LSPID) Conditional Grant. Bi-monthly and quarterly monitoring of the implementation of PEDs’ procurement plans using the LSPID bi-monthly expenditure, tracking and analysing of provincial monthly expenditure and quarterly reports and through quarterly provincial budget monitoring and support meetings.
  • Payment for Capital Assets – The under expenditure was with the ASIDI programme. Procurement of the outstanding 61 projects is underway and targeting site hand over at the beginning of the 4th quarter. Various concurrences have been given to the Mvula Trust in the Eastern Cape and should enable implementation of water projects. Tranche requisitions for both the Development Bank of Southern Africa (DBSA ) CDC of almost R 200 million will be spent in September to bring the expenditure to around 60 percent by the end of the 2nd quarter. The unit is engaging the Free State Department of Education on a reliable construction recovery plan to ensure that expenditure on their programme is ramped. The DBSA and CDC in the Eastern Cape have been experiencing site disruptions by the local contractors which has delayed construction projects. The Department has since held meetings with the concerned contractors and construction on site has resumed which will assist in improving expenditure.

 

4.         Report of the Auditor-General on the Department’s audit outcomes

The audit outcomes of the portfolio for 2018/19 remained stagnant from the prior period. Financial statement preparation remains a concern as material adjustments were effected to annual financial statements submitted for audit at Department of Basic Education (DBE), the Council for Quality Assurance in General and Further Education and Training (Umalusi) and the South African Council for Educators (SACE). The qualified audit opinions for the DBE are mainly due to control deficiencies in the control environment regarding monitoring and accounting of the infrastructure programme (ASIDI).

The qualifications are on immovable tangible capital assets with a resultant impact on capital commitments disclosure, expenditure on capital assets and goods and services expenditure. Contingent liabilities comparative balance, capital commitment disclosure accruals and payables not yet recognised were also qualified. In addition, the controls to prevent and detect instances of non-compliances when procuring goods and services were inadequate, as a result irregular expenditure (IE) was also qualified as completeness of the balance could not be confirmed.

4.1       Credible Financial Reporting

  • The submission of financial statements by the legislated date stood at 100 percent
  • Financial statements submitted without error was zero percent
  • Quality of final submission after auditing was at 67 percent. The 67 percent achieved unqualified opinions only because they corrected all misstatements identified during the audit.

4.2       Credible Performance Reporting

  • Performance report submitted without error stood at 33 percent
  • Quality of final submission after auditing was at 67 percent. As management subsequently corrected only some of the misstatements, the Auditor-General of South Africa (AGSA) still reported material findings on the usefulness and reliability of the reported performance information after auditing.

 

            4.3       Fruitless and Wasteful Expenditure (R 837 000.00) - The Department incurred fruitless and wasteful expenditure top the value of R 837 000.00. This was caused by contractor invoices not having been paid timeously.

 

     4.4       Potential Fruitless and Wasteful Expenditure (R 97.142 million) – The potential fruitless and wasteful expenditure relates to cost incurred for school infrastructure projects that were subsequently discontinued, for example due to schools no longer being viable and rationalisation processes. Included for both years was R10,689 million relating to the Kha Ri Gude project currently under investigation by the Hawks (stipend payments to volunteers)

 

     4.5       Irregular Expenditure (DBE – R 208.8 million, Umalusi – R 1.9 million) – The 100 percent Irregular Expenditure (IE) in the current and previous year was as a result of contravention of Supply Chain Management (SCM) legislation. The Department received a qualification on the completeness of IE. The full extent of the understatement of IE for the current and previous year could not be determined, as it was impracticable to do so.

 

            4.6       Potential Irregular Expenditure (DBE – R 504.3 million) – The potential IE relates to costs

                        incurred for school infrastructure projects in excess of the approved and contracted amount. Included in the amount for 2018-19 is R379 million relating to ten (10) school infrastructure projects under investigation by the Special Investigating Unit (SIU) regarding allegations of procurement and contracting irregularities.

 

4.7       Supply Chain Management (SCM) – There was an improvement in SCM compliance for 2018/19 with 33 percent with no findings. AGSA was of the view that all SCM findings will be investigated. The most common SCM findings included:

  • Not able to audit procurement of R 149 million due to missing or incomplete information
  • Uncompetitive and unfair procurement processes (33 percent of auditees)
  • Allegations of financial and/or fraud and SCM misconduct:
    • Allegations not investigated – 33 percent (DBE)
    • Investigations took longer than three months – 33 percent (DBE)
    • Allegations not properly investigated – 33 percent (DBE) 

A total of two investigations by external parties (SIU and Hawks) were ongoing at year-end with regards to 11 allegations of financial misconduct and/or fraud and SCM misconduct. These investigations have been ongoing for a period exceeding 12 months (DBE). For 17 completed investigations into prior year irregular expenditure instances, timeous appropriate action (sanction) was not taken as per the recommendations of the investigation committee as at year-end 2018-19 (DBE). The prior year instances of potential irregular expenditure were not investigated. Instances of prior years’ potential fruitless and wasteful expenditure were partially investigated, and where the instances were investigated, the investigations were not performed timeously (DBE).

 

4.8            Material Irregularities Identified – Payments were made for construction work that was not of the required quality standard as there was a lack of proper professional service provider supervision by the department in the execution of the work. Effective internal controls, that should have prevented the payments for the defective work, were therefore not in place when the payments were approved and processed, as required by treasury regulation 8.1.1. Further payments had to be made to another contractor appointed to perform remedial construction work, which resulted in a material financial loss for the department. The project was funded by the accelerated school’s infrastructure delivery initiative (ASIDI) backlog grant.

 

An investigation into the matter by the Departmental investigation committee was concluded during the 2017-18 financial year. The accounting officer aims to recover the money in the 2019-20 financial year.

 

4.9            Root Causes

  • Slow or No response to improving key controls and addressing risk areas – Management (accounting officers/ authorities and senior management), the political leadership (executive authorities) and oversight bodies (Standing Committee on Public Accounts (SCOPA) and Portfolio Committees (PCs)) do not respond with the required urgency to AGSA messages about addressing risks and improving internal controls.
  • Inadequate consequences for poor performance and transgressions – If officials who deliberately or negligently ignore their duties and contravene legislation are not held accountable for their actions, such behaviour can be seen as acceptable and tolerated.

 

4.10          AGSA Recommendations (DBE and Entities):

  • During the interaction with the Portfolio Committee, AGSA recommended that the accounting officer and authorities should ensure that senior management has an action plan in place to address the internal control deficiencies identified by our reports as root causes of audit findings. The action plan should focus on the root causes of audit outcomes and not only on addressing specific findings, as this would prevent new or similar findings in future. The accounting officer should monitor the implementation of the plan.
  • The accounting officer and authorities should ensure that non-compliance findings are investigated to determine whether there are indicators of financial misconduct or misconduct in the SCM processes. Disciplinary hearings should be held where misconduct was confirmed. All irregular as well as fruitless and wasteful expenditure (including potential IE and FW) should also be investigated timeously to determine whether such expenditure should be recovered from the responsible official. In order to improve the performance and productivity of officials, the leadership should set the tone by implementing sound performance management processes, evaluating and monitoring performance, and consistently demonstrating that poor performance has consequences.
  • Controls should be in place to ensure that transactions are processed in an accurate, complete and timely manner, which will in turn reduce the errors and omissions in financial and performance reports.
  • Such controls include (i) the daily capturing of financial transactions, supervisory reviews of captured information, and independent monthly reconciliations of key accounts, (ii) the collection of performance information at intervals that are appropriate for monitoring service delivery targets and milestones as well as the validation of recorded information and (iii) confirming that legislative requirements and policies have been complied with before initiating transactions.

 

5.  Financial Performance for the First Quarter (Q1) 2019/20, DBE

 

5.1       Allocation against Actual Expenditure per Programme Q1 2019/20

 

Table 1: Allocation against Actual Expenditure per Programme

 

Programmes

                                                    2019/20

APROPRIATION

Q1 ACTUAL                                   

EXPENDITURE

Expenditure as % of

Appropriation

Q1 Projected expenditure

Variance from projected expenditure

R’000

R’000

R’000

  R’000

  R’000

Administration

496,3

119,8

24,1 %

106.7

-13,1

Curriculum Policy, Support and Monitoring

1 989,0

135,4

6,8 %

142.4

7,0

Teachers, Education Human Resources Development and Institutional Development

1 366,3

1 249,6

 91,5 %

1 250.3

0,7

Planning, Information and Assessment

13 144,3

4 244,7

32,3 %

4 622.4

377,7

Educational Enrichment Services

7 508,8

2 559,1

34,1 %

2 560.4

1,3

Total

24 504,5

8 308,6

33,9 %

8 682,2

373,6

 

The total Final Appropriation budget of the Department for the 2019/20 financial year amounts to R24.5 billion. The actual expenditure for the First Quarter amounted to R8.3 billion or 33.9 percent of the available budget, compared to the spending of 34.3 percent in 2018/19. The 2019/20 First Quarter spending was lower compared with the Department’s projections to spend R8.6 billion. The variance was mainly attributed to programme four under payments for capital assets.

 

5.1.1 Expenditure analysis per programme

 

Programme 1: Expenditure under this programme was higher by R13.1 million or 12.2 per cent, compared to the projections to spend. This higher than projected spending on compensation of employees as mainly due to the payment of the former Deputy Minister’s leave gratuity (paid from compensation of employees rather than transfers to households), and the appointment of additional personnel in the Minister and new Deputy Minister’s offices, in line with the new Ministerial guidelines. There were also higher audit costs due to additional costs for the regularity audit conducted and higher costs than expected for the server procured through SITA for information technology services and expenditure on interest and rent on land is higher than projected by R7.2 million as the department did not include the management fee for their accommodation costs in their initial projections.

 

Programme 2: Expenditure on this programme was lower than projected by R7 million or 4.9 per cent. This lower than projected expenditure was due to a delay in the printing of workbooks because of corrections to the workbook data received from provinces as well as delays in the printing of study guides and receipt of invoices from teachers for the Second Chance Matric Project.

 

Programme 3: The Department had projected to spend R1.25 billion but were able to spend R1.24 billion. The deviation of R0.7 is insignificant.

 

Programme 4: Expenditure was lower than projected by R377.7 million or 8.2 per cent of the available budget. This was mainly attributed to the school infrastructure backlogs grant where R135 million was spent against projections to spend R540.7 million. The low spending was due to delays in appointing contractors to provide safe and appropriate sanitation at schools and delays in the procurement of new contractors to replace non-performing contractors. The transfer to Umalusi was higher than projected by R33.7 million since the payment was made a month earlier than initially projected.

 

Programme 5: The Department had projected to spend R2,56 billion and were able to spend R2.55 billion. The marginal deviation of R1.3 million is insignificant.

 

 

5.1.2 Expenditure on Personnel

 

The Department had projected expenditure on compensation of employees by R0,5 million. The higher than projected expenditure mainly emanated from the Administration programme where expenditure was higher than projected by R3.7 million as a result of a once off payment of R2 million for the former Deputy Minister’s leave gratuity, as well as additional staff appointed for the Minister and new Deputy Minister in line with the new Ministerial guidelines. The Department’s headcount was above the HRBP target by 69, mainly in programmes 1, 2 and 4 by 18, 42 and 10 respectively under salary levels 5, 11 and “other”. This was mainly due to the payment of contracted personnel for the Matric 2nd Chance project and the rural education assistants’ project who were included in the headcount, but paid from goods and services. The additional personnel captured under “other” are interns employed by the Department, who are not part of the department’s establishment and so excluded from the HRBP headcount target.

 

6.         Overview and Assessment of Service Delivery Performance

6.1       Service Delivery Performance for 2018/19As in 2017/18, the total number of indicators for all DBE programmes for 2018/19 was 44. The Department improved its overall performance towards the achievement of its set targets from fully achieving 77 percent, partially achieving 16 percent and not achieving 11 percent in 2017/18 to fully meeting 85 percent, partially achieving 13 percent and not achieving 2 percent in 2018/19. The Department once again failed to achieve the target on the number of new schools built and completed through ASIDI in Programme 4. 

 

6.2       Programme Performance

 

6.2.1    Programme One: Administration – This Programme is responsible for the management of the Department and the provision of strategic and administrative support services. Within this Programme, the Department had one quarterly and two annual performance indicators as follows:

 

Performance Indicator

Target Achieved or Exceeded

Percentage of service providers within the procurement unit paid within 30 days

The target was set at 100 percent but the Department actual achievement was 99.05. A negative deviation of 0.95. The deviation was due to a lack of invoice days’ tracker tool system.

Percentage of received misconduct cases resolved within 90 days

The target was set at 85 percent and the Department actual achievement was 100 percent.

A positive negative deviation of 15 percent. The deviation was due to the fact that DBE systems are in place to deal with misconduct cases.

Percentage of received grievances cases resolved within 30 days

The target was set at 85 percent and the Department actual achievement was only 42.30 percent. A negative deviation of 42.70 percent. The deviation was due to the unavailability of parties to the grievances and the prescribed days were exceeded.

 

 

6.2.2    Programme Two: Curriculum Policy, Support and Monitoring – This Programme is responsible for the development of curriculum and assessment policies and monitor and support their implementation. Within this Programme, the Department had 19 performance indicators – five quarterly, three bi-annual and eleven annual targets as follows:

 

Performance Indicator

Target Achieved or Exceeded

Number of off-line digital content packaged and distributed to provinces

 

The quarterly target was set at 15 and the Department’s actual achievement was 15 with no deviation.

Number of schools per province monitored for utilisation of ICT resources

 

The quarterly target was set at 27 and the Department’s actual achievement was 27 with no deviation.

Number of off-line digital content resources developed annually

 

The annual target was set at eight and the Department’s actual achievement was eight with no deviation.

Percentage of public schools with Home Language workbooks for learners in Grades 1-6

 

The annual target was set at 100 percent and the Department’s actual achievement was 100 percent with no deviation.

Percentage of public schools with Mathematics workbooks for learners in Grades 1-9

 

The annual target was set at 100 percent and the Department’s actual achievement was 100 percent with no deviation.

Percentage of public schools with workbooks for Grade R

 

The annual target was set at 100 percent and the Department’s actual achievement was 100 percent with no deviation.

Number of schools monitored on the implementation of the reading norms

 

The annual target was set at 20 and the Department’s actual achievement was 22. A positive deviation of two schools was due to the monitoring of more schools in the Eastern Cape, Free State and Mpumalanga to ascertain compliance with the implementation of the Reading Norms.

Number of schools monitored on the implementation of the Incremental Introduction to African Languages (IIAL) annually

 

The annual target was set at 20 schools and the Department’s actual achievement was 20 schools with no deviation

Number of underperforming schools monitored on the implementation of the Early Grade Reading Assessment (EGRA)

 

The annual target was set at 75 schools and the Department’s actual achievement was 92 schools. A positive deviation of 17 schools due to provinces wanting to monitor more schools to enable them to assess the success of the project.

Number of Mathematics, Science and Technology lesson plans monitored for the Intermediate, Senior and FET Phases

 

The annual target was to monitor Grade 10 – 12 lesson plans for Technical Mathematics and Science. A total of 34 Technical Mathematics lesson plans were developed and monitored for Grade 10 (13), Grade 11 (13) and Grade 12 (8). A total of 12 Technical Science lesson plans were monitored (i.e. four for each of the Grades 10 – 12).

The deviation could not be determined because the planned target was not quantified.

Number of Mathematics, Science and Technology teacher guides developed for the intermediate, Senior and FET Phases

 

The annual target was to develop Grade 10 – 12 teacher guides for Technical Mathematics and Science. Only Technical Mathematics and Technical Science Grade 12 teacher guides were developed.

Grade 10 and 11 Technical Mathematics and Technical Sciences teacher guides were not developed – these were informed by the diagnostic reports and will be developed in the 2020/21 and 2021/22 financial years respectively for both subjects

Number of Mathematics training sessions/workshops monitored

 

The bi-annual target was set at nine and the Department’s actual achievement was nine with no deviation

Number of training of CAPS for Technical subjects monitored

 

The bi-annual target was set at 14 but the Department’s actual achievement was only 10 with a negative deviation of four. The deviation was due to Provinces not conducting training as service level agreements were not signed with the training centres.

Number of schools visited for monitoring CAPS implementation in technical schools

 

The quarterly target was set at 54 schools and the Department’s actual achievement was 54 schools with no deviation

Number of schools with Multi-Grade classes implementing the Multi-Grade Toolkit monitored

 

The quarterly target was set at 140 schools and the Department’s actual achievement was 142 schools with no positive deviation of two schools. The deviation was due to the Mpumalanga Province monitoring more schools to ascertain compliance.

Number of advocacy campaigns conducted on the Rural Education Policy in the provinces

 

The quarterly target was set at nine campaigns and the Department actual achievement was nine campaigns with no deviation

Number of learners obtaining subject passes towards a National Senior Certificate (NSC) or extended Senior Certificate, including upgraded NSC per year

 

The bi-annual target was set at 25 000 learners and the Department’s actual achievement was 64 062 learners with a positive deviation of 39 062 learners. This deviation was due to the quality of support provided and the inclusion of support by the Department of Higher Education and Training, Community Colleges and partnerships with NGO support centres.

Number of Children/ Learners with Severe to Profound Intellectual Disability (C/LSPID) who utilise the Learning Programme for C/LSPID

 

The annual target was set at 3 327 children and the Department’s actual achievement was 6 416 children with a positive deviation of 3 089 children. The deviation was due to an increase in the number of special care centres

Number of Children/ Learners with Severe to Profound Intellectual Disability (C/LSPID) with access to therapeutic and psycho-social support services that will enable them to improve their participation in learning

 

The annual target was set at 3 327 children and the Department’s actual achievement was 6 416 children with a positive deviation of 3 089 children. The deviation was due to an increase in the number of special care centres

 

 

6.2.3    Programme Three: Education Human Resources and Institutional Development – This Programme is responsible for promoting quality teaching and institutional performance through the effective supply, development and utilisation of human resources. All 10 performance indicators in this Programme were annual indicators as follows:

 

Performance Indicator

Target Achieved or Exceeded

Percentage of SGBs that meet minimum criteria in terms of effectiveness

 

The annual target was set at 80 percent of 2 000 sampled SGBs and the Department actual achievement was 1 793 of 1 846 (97.1 percent). A positive deviation of 17.1 percent due to SGBs beginning to understand their roles and responsibilities. Furthermore, the achievement was exceeded due to increased monitoring by officials.

Percentage of schools producing the minimum set of management documents at a required standard

 

The annual target was set at 80 percent of 2 000 sampled schools and the Department actual achievement was 1 674 of 1 917 schools (87.3 percent). A positive deviation of 7.3 percent due to improved monitoring by district officials.

Number of Funza Lushaka bursaries awarded to students enrolled for initial teacher education

 

The annual target was set at 13 500 bursaries and the Department actual achievement was 13 070 bursaries. A negative deviation of 430 bursaries. DBE submitted to the National Student Financial Aid Scheme (NSFAS )a list approved bursary holders to be funded (13 7000). At the time of the audit a number of students had not received their bursary funding from NSFAS.

Number of teachers participating in the EFAL diagnostic tests

 

The annual target was set at 2 000 teachers and the Department actual achievement was 2 029 teachers. The positive deviation of 29 teachers was due to the Department developing a protocol on teacher assessments that has assisted in improving advocacy around teacher assessments. There seems to be a slight improvement on the negative perception from teachers about assessments.

Number of teachers participating in the Physical Science diagnostic tests

 

The annual target was set at 2 000 teachers and the Department actual achievement was 2 008 teachers. The positive deviation of eight teachers was due to the Department developing a protocol on teacher assessments that has assisted in improving advocacy around teacher assessments. There seems to be a slight improvement on the negative perception from teachers about assessments.

Number of teachers participating in the Accounting diagnostic tests

 

The annual target was set at 2 000 teachers and the Department actual achievement was 2 035 teachers.

The positive deviation of 35 teachers was due to the Department developing a protocol on teacher assessments that has assisted in improving advocacy around teacher assessments. There seems to be a slight improvement on the negative perception from teachers about assessments.

Number of teachers participating in the Mathematics diagnostic tests

 

The annual target was set at 2 000 teachers and the Department actual achievement was 3 339 teachers.

The positive deviation of 1 339 teachers was due to the Department developing a protocol on teacher assessments that has assisted in improving advocacy around teacher assessments. There seems to be a slight improvement on the negative perception from teachers about assessments

Number of PEDs monitored on the implementation of IQMS

 

The annual target was set at six PEDs and the Department actual achievement was six PEDs with no deviation

Number of PEDs monitored on the implementation of PMDS

 

The annual target was set at six PEDs and the Department actual achievement was six PEDs with no deviation

Number of PEDs that had their post provisioning process assessed for compliance with the post provisioning Norms and Standards

 

The annual target was set at nine PEDs and the Department actual achievement was nine PEDs with no deviation

 

 

6.2.4    Programme Four: Planning, Information and Assessment – This Programme is responsible for promoting quality and effective service delivery in the basic education system through planning, implementation and assessment. Within this Programme, the Department had 12 annual performance indicators as follows:

 

Performance Indicator

Target Achieved or Exceeded

A bank of Language and Mathematics test items for Grade 3,6 and 9 developed

 

The annual target was set at 200 and the Department actual achievement was 328. A positive deviation of 128 due to the number of items developed were exceeded because the pilot study requires more items to trial out.

Number of NSC reports produced

 

The annual target was set at four reports and the Department actual achievement was four reports with no deviation

Number of question papers set annually for NSC and SC

 

The annual target was set at 260 question papers and the Department actual achievement was 260 question papers with no deviation

Number of new schools built and completed through ASIDI.

 

The annual target was set at 50 new schools and the Department actual achievement was 21 new schools. A negative deviation of 29 schools. This deviation was due to contractors in the Eastern Cape Province with cash flow problems, some facing liquidation were unable to meet targets. Construction was affected by inclement water, unreliable water electricity in the areas where schools are located. There was closure of sites by concerned groups of contractors and PSP demanding that they be awarded some of the projects.

Number of schools provided with sanitation facilities through ASIDI.

 

The annual target was set at 286 schools and the Department actual achievement was 200 schools. A negative deviation of 86 schools. This deviation was due to contractors experiencing cash flow problems and cannot advance payments required for materials delaying the implementation of the projects. Poor contract management by Implementing Agents that cannot identify poor performing contractors.

Number of schools provided with water through ASIDI.

 

The annual target was set at 325 schools and the Department actual achievement was 199 schools. A negative deviation of 126 schools. This deviation was due to contractors experiencing cash flow problems and cannot advance payments required for materials delaying the implementation of the projects. Poor contract management by Implementing Agents that cannot identify poor performing contractors.

Number of schools provided with electricity through ASIDI.

 

Nil report

Percentage of public schools using the standardised school administration system, SA-SAMS for reporting.

Number of provinces monitored by DBE officials for implementation of LURITS annually.

 

The annual target was set at 98 percent and the Department actual achievement was 98.2 percent. The use of South African School Administration and Management Systems (SA-SAMS) was promoted by way of circulars from PEDs and DBE for submitting data for quarterly reporting using SA-SAMS

The annual target was set at one report covering all nine provinces. The Department achieved this with no deviation.

Number of officials from districts that achieved below the national benchmark in the NSC participating in a mentoring programme.

 

The annual target was set at 30 officials and the Department actual achievement was 76. This positive deviation was due to support visits by the Deputy Director-General (DDG) to evaluate the past cycle of mentoring and the impact thereof as well as to set a new tone in terms of areas to mentor with the district for the next cycle.

Percentage of school principals rating the support services of districts as being satisfactory.

 

The annual target was set at 71 percent of school principals and the Department actual achievement was 75 percent. The positive deviation of four percent was due to various interventions undertaken over the last three years to monitor and strengthen district support to schools.

Percentage of district managers assessed against developed criteria.

 

The annual target was set at 90 percent and the Department actual achievement was 100 percent. This positive deviation of 10 percent was due to the administration of competency assessments now being mandatory and had to be undergone by all new permanent appointees.

 

 

6.2.5    Programme Five: Education Enrichment Services – This Programme is responsible for developing policies and programmes to improve the quality of learning in schools. Within this Programme, the Department had one annual and three quarterly performance indicators as follows:

 

Performance Indicator

Target Achieved or Exceeded

Number of schools monitored for the provision of nutritious meals.

 

The quarterly target was set at 110 schools and the Department actual achievement was 135 schools. The positive deviation of 35 schools was due to prioritizing the monitoring of districts instead of schools to improve quality and efficiency

Number of professionals trained in SASCE programmes.

 

The annual target was set at 900 professionals and the Department actual achievement was 973 professionals. The positive deviation of 73 was due to the different mobilization strategies and strengths employed by the different provinces.

Number of learners, teachers, officials, SGBs and community organisation members participating in social cohesion and gender equity programmes.

 

The quarterly target was set at 7 000 and the Department actual achievement was 7 511. The positive deviation of 511 was due to partnerships and collaborations within directorates and Branches and sharing of resources in order to achieve our objective.

Number of Hot Spot Schools monitored towards Implementation of the NSSF.

 

The quarterly target was set at 47 hot spot schools and the Department actual achievement was 106 hot spot schools. The positive deviation of 59 was due to officials being in close proximity to the existing 59 districts/school. This had no cost implications.

 

 

6.3       Overview and Assessment of Financial Performance

 

6.3.1    Allocation against Actual Expenditure per Programme for the 2018/19 Financial Year

  •  
  1.  

Expenditure as % of Appropriation

  1.  

ACTUAL EXPENDITURE

  1.  
  1.  
  1.  
  1.  

Administration

476565

471919

4646

99.0%

Curriculum Policy, Support and Monitoring

1 861689

1 802191

59498

96.8%

Teachers, Education Human Resources Development and Institutional Development

1 307146

1 297611

9535

99.3%

Planning, Information and Assessment

12 943527

12734 639

208888

98.4%

Educational Enrichment Services

7110 656

7108 407

2249

100.0%

Total

23699 583

23414 767

284816

98.8%

 

The budget allocation of the Department of Basic Education in 2018/19 was R23.7 billion, which represented a nominal increase of R705 963 from 2017/18. The majority of the budget (80.7% amounting to R19.1 billion) consisted of transfers and subsidies, mainly to provinces and municipalities. This means that the Department had an available budget of R4.6 billion for compensation of employees, earmarked funds, office accommodation, departmental operations and other projects.

 

            Actual expenditure in 2018/19 was R23.7 billion or 98.8 percent of the allocated budget compared to 99.7 percent in 2017/18. The unspent balance of R284.8 million at the end of 2018/19 was more than in 2017/18, when R61.7 million was unspent. The main contributors to the under-spending in 2018/19 was Programme 2 that had spent 96.8 percent and Programme 4 that spent 98.4 percent. Programmes 1, 3 and 5 spent 99 percent, 99.3 percent and 100 percent respectively.

 

  1.  

 

  • Programme 1: Administration (Underspent: R 4 646) million) - There were no material variances on this programme.

 

  • Programme 2: Curriculum Policy, Support and Monitoring (Underspent: R 59.498 million) – The underspending is due to unfilled vacant positions including the Deputy Director posts in the Free State and KwaZulu-Natal. The LTSM electronic system couldn't be procured due to the SITA requirement that the proposal must include budget allocation for the outer years. LSPID grant CoE constitutes more than 50 percent of this grant. However, the posts for this grant are not permanent. It is for this reason that PEDs struggled to recruit and maintain a full complement of therapists for this project.

 

  • Programme 3: Teachers, Education Human Resources Development and Institutional Development (Underspent: R 9.535 million) - There were no material variances on this programme.

 

  • Programme 4: Planning, Information and Assessment (Underspent: R 208.888 million) – The projects were estimated at R 230 million. The procurement process was halted due to local content requirements by the Department of Trade and Industry, meaning projects could not be implemented. ASIDI projects in the Eastern Cape were delayed due to stoppage as a results of disruptions by the Eastern Cape Black Contractors Association whereby the association has forcefully demanded that the site be closed and they be given part of the projects.

 

  • Programme 5: Education Enrichment Services (Underspent: R 2.249 million) - There were no material variances on this programme.

 

  

7. Assessment of the 2018/19 performance of the Department, including by other Entities

 

7.1 Key issues raised by the Financial and Fiscal Commission pertaining to the performance of the Department

 

  • Infrastructure and educational outcomes: The FFC was of the view that, based on the essential role that school infrastructure plays in addressing issues related to access and educational quality, regulations on norms and standards for school infrastructure would go a long way in enhancing teaching effectiveness and improving student learner outcomes.
  • ASIDI: The Commission noted the following challenges with regard to the implementation of ASIDI:
  • Poor communication and sharing of information
  • Slow procurement and implementation processes
  • Inadequate management capacity especially at project management level
  • Disincentives related to implementing agents not being the owner of a project
  • Lack of effective systems for monitoring and controlling service providers
  • Poor financial management systems that result in late payments to service providers
  • Education Infrastructure Grant (EIG): The Commission noted that the allocations to EIG had been cut due to fiscal consolidation efforts and Provincial allocations in respect of education infrastructure were likely to come under pressure as a result of subdued economic climate.
  • Challenges with existing infrastructure delivery mode: The FFC noted that  the status quo for delivering most provincial infrastructure projects separated the planning, budgeting and implementation functions between sector departments and implementing agents, thus distorting incentives and weakening the accountability chain e.g. Projects were often over budget and time overruns were frequent because public works and other implementing agents appointed consultants to design and oversee infrastructure projects, but were not incentivized to properly manage them as the Auditor General does not hold implementing agents accountable for infrastructure spending.

 

  • Conditional grants; The FFC noted that spending performance on the Learners with Severe to Profound Intellectual Disabilities had improved from 68.4 percent in 2017/18 to 82.7 percent 2018/19. However, some provinces still experienced challenges including:
  • Under-expenditure due to the delay in the recruitment of required personnel; and
  • Access issues – long waiting periods for placement of learners into special schools.

More effective over basic education conditional grants was required.

  • Equity: Although policy and funding frameworks had attempted to entrench equal treatment of learners, the FFC had observed that the funding framework mostly disregarded historical disparities and there were other important constraints which affected disadvantaged schools. The Commission referred to cases of persistent funding below the national threshold in some provinces which needed to be urgently investigated and an adequate recovery plan be devised. 

 

7.2 AGSA’s audit of SA-SAMS and LURITS Interface

     During  the audit of SA-SAMS at the provinces, the following were noted for most of the schools

     visited:

  • There was no evidence of a formally documented and approved procedure to manage the granting of user access to SA-SAMS. Furthermore, there was no formal access request documentation completed for registering users, changing access rights, password resets and termination of access to SA-SAMS. This could result in inconsistencies in the user access management process and could even result in users gaining unauthorised access to SA-SAMS.
  • There was no documented backup process or procedure. Furthermore, schools did not have a backup register/log that is signed off as evidence of the successful completion of backups, and backups were not stored at a secure off-site location. This could result in a loss of data in the event of a disaster or system failure.

 

All the provinces were using Data Warehouse to consolidate the data coming from schools and to ensure that data uploaded on Learner Unit Record Information and Tracking System (Lurits) II is complete and accurate.

 

7.3 Department of Basic Education Audit Committee

7.3.1    Audit Improvements

 

The Audit Committee noted that in respect of audit improvements, the Department had the following in place:

 

  • Monitoring the performance information on a quarterly basis and annual target milestones achievements through internal audits to verify reliability of evidence reported.
  • Enhanced effective coordination of verification of reported evidence with Strategic Planning and Branches.
  • Reviewing and monitoring the second chance matric programme for database management and validity of records.
  • Reviewing and follow ups audits on ASIDI on the controls and co-coordination of Practical Certificate for completed projects.
  • Reviewing and monitoring the management of accruals, commitment, advance payment to Implementing Agents. 
  • Assisting the Accounting Officer with the investigation of irregular, fruitless and wasteful expenditure.
  • Stability in leadership (Accounting Officer).
  • Stability in the governance structures (Audit Committee).
  • Monitoring of the risk management activities, Branches quarterly reporting progress on mitigation action on identified risks.

 

7.3.2    Improvements on Irregular Expenditure

 

In respect of improvements on irregular expenditure the Department had reportedly established an investigation Committee to investigate cases of irregular expenditure. Management needed to implement consequence management and improve the control measures in this regard.

 

7.3.3    Challenges

Regarding challenges, the Department indicated that leadership oversight from Deputy Director-General, Chief Director and Director levels was not effective in certain areas. Branches needed to improve intensive quality assurance. There were challenges with capacity in ASIDI, Finance and Supply Chain Management. The Department had not fully addressed prior audit findings. There was a need to strengthen quality assurance of work done by Implementing Agents.

 

7.3.4    Accelerated Schools Infrastructure Delivery Initiative (ASIDI) – There were misstatements on assets and commitments with incomplete accruals. There was further irregular expenditure reported with contingent assets and liabilities. Some of the root causes included a weakness in quality assurance, poor management in the section and capacity challenges to monitor effectively. Further to this, project managers were not performing.

 

To mitigate these challenges, the Department looked to improve monitoring of Implementing Agents, PSU and ASIDI staff to improve the process. The Department would ensure a full set of half-year financial statements with accurate records and the submission of information for preparation of Annual Financial Statements timeously. The Department would also look at possible disciplinary action against persons that caused irregular, fruitless and wasteful expenditure.

 

7.3.5    Review of the Annual Report – The annual report was reviewed prior to submission to the AGSA. AGSA worked with the Internal Audit Committee to correct other gaps identified during the review meeting prior the submission date. Some deficiencies were still identified by the AG due to late submission of information by Branches.

 

7.3.6    Audit Outcomes: Performance Information

 

7.3.6.1 Proposed Improvements – The Audit Committee (AC) recommended an electronic system be obtained to improve control and strengthen quality assurance over performance information. There was a need for Management to strengthen quality assurance of reported information timely. There was a need for more detail work by Internal Audit on quarterly performance information reports and financial statement reviews. There was a need for Management to improve or address the capacity challenges in Strategic Planning, Finance, and ASIDI.

 

7.3.6.2 Management Audit Action Plan – The Audit Committee (AC) had received a management action plan to address the AGSA findings and had been monitoring progress. The AC would request Internal Audit to do follow-up reviews. The AG also held a comprehensive workshop with Management in October 2018 to discuss improvement actions and to determine whether it would address the root cause of findings.

 

7.3.6.3 Other Interventions - The Internal Audit Committee worked with management and AGSA on the issues raised during the audit which also resulted in material misstatements and significant changes in the finalisation of the annual report.

 

8. Overall Portfolio Committee Observations

  1. Audit Outcomes

 

  • The Portfolio Committee notes with concern that the audit outcome of the Department for 2018/19 remains stagnant as a qualified audit opinion. The Committee queried whether AGSA’s recommendations of prior years had been implemented to ensure the non-recurrence of these negative findings. Members also queried the action by the Audit Committee to ensure that the Department implements corrective measures in order to receive the desired audit outcome.
  • Members queried the assistance and support provided by the Audit Committee to ensure and safeguard the budget of the Department and the effectiveness of the Audit Committee in mitigating the risks faced by the Department. Members requested a report from the Department on the implementation of AGSA recommendations to address gaps.
  • Members noted that recurring audit findings of inadequate consequence management relating to ASIDI were concerning and urged the Department to strengthen measures in place to implement consequence management in relation to errand companies. Similarly, Members were of the view that errand officials, including those who incurred irregular expenditure, also be held accountable for failures in their duties.
  • The Portfolio Committee is encouraged by the report that the Department has begun to address the 2018/19’s audit findings but would require that the Department submit a comprehensive Action Plan and quarterly reports on the implementation of the Action Plan.  

 

8.2 Performance per Programme

 

8.2.1 Programme 2: Curriculum Policy, Support and Monitoring

 

  • Members queried the recent Grade 9 General Education Certificate and requested that the Minister briefed the Portfolio Committee on the matter. On the matter of the migration of Early Childhood Development (ECD) from the Departments Social Development to the Department of Basic Education, the Committee heard that the two Departments were still engaging and processes were unfolding. The Department would present to the Portfolio Committee on the status and progress in this regard.
  • The Department also undertook to present to the Portfolio Committee at a later stage on issues pertaining to learners with special needs to address questions raised by Members on the subject.

8.2.2 Programme 3: Teachers and Education Human Resources Development and

Institutional Development

 

  • Members queried the difference between the Integrated Quality Management System (IQMS) model being phased out and the new Quality Management System (QMS) model being implemented.

 

8.2.3 Programme 4: Planning, Information and Assessment

  • The Portfolio Committee raised concerns with the ASIDI programme as follows:
  • Members queried the monetary loss to the Department to date since inception.
  • From inception, there seemed to be little or no improvements in respect of school infrastructure.
  • The ASIDI programme was not achieving targets relating to completed schools to replace inappropriate infrastructures and the provision of water and decent sanitation. The Committee was concerned that this resulted in the Department receiving qualified audit with findings.
  • The Portfolio Committee was also concerned that the Department was not receiving value-for money with ASIDI

 

  • The Portfolio Committee urged the Department to take steps to ensure that ASIDI succeeded.

 

  • Members raised concern over projects that needed further intervention from different service providers due to poor workmanship and queried the extent of the problem.
  • Members also queried the assistance and support from the FFC in respect of the many Implementing Agents who were allocated projects.
  • Members requested that the Department gives progress reports   on ASIDI during quarterly reporting to the Portfolio Committee going forward. The information reported must have been verified by the internal audit and the audit committee.
  • Members queried reasons why the Department had appointed technical expertise but had them based in Pretoria and not in the PEDs where they were needed. Members queried how effective these technical personnel were while based in Pretoria. Members questioned whether such technical expertise could be deployed in PEDs as well.
  • Members queried the status of learner transport and whether National Treasury had approved the grant and when this would be implemented.
  • Members also queried whether there was a uniform framework of norms and standards for the building of new schools in all nine provinces. It was noted from the engagement with the Department that there was a standard design for the spaces but schools did not necessarily look exactly the same.
  • Members noted with concern that the allocation component of the Equitable Share formula for learners was not taking inflation into consideration.
  • Members noted from the FFC’s presentation that there was a view that consideration, as an option, be given to have ASIDI being decentralisation and making it a direct grant to PEDs. The FFC’s assessment was that PEDs were better at delivering on infrastructure. 
  • Members heard from the Department’s that they continued to focus their attention on the challenges being faced with ASIDI and how best to mitigate these challenges.

The Portfolio Committee noted that it was important for the Department to strengthen their forensic audit and investigation unit.

 

8.3 Conditional Grants

  • The Committee is concerned about the continuous underspending of the Learners with Severe to Profound Intellectual Disabilities conditional grant. The Department should provide the necessary support to the relevant provinces in order to decisively deal with this challenge.

 

 

9.         Statutory Bodies

9.1       Council for Quality Assurance in General and Further Education and Training (Umalusi)

Umalusi received its 18th unqualified opinion since 2001. There were no material findings on pre-determined objectives and Supply Chain Management.

 

9.1.1    Background and mandate

Umalusi is the Quality Council responsible for qualifications registered on the General and Further Education and raining Qualifications Sub-Framework (GFETQSF), which is part of the National Qualifications Framework (NQF). The Council ensures that the providers of education and training have the capacity to deliver and assess qualifications and learning programmes and that they are doing so to expected standards of quality. The core business of Umalusi is to:

  • Develop and manage a framework of qualifications for General and Further Education and Training (GFET) that is benchmarked internationally;
  • Quality assure qualifications and curricula;
  • Confirm that assessment is fair, valid and reliable;
  • Quality assure the provision of education and training, and assessment providers; and
  • Ground its work in research to ensure informed positions and approaches.

           

                        9.1.2    Overall status of performance for 2018/19 – The overall status of performance of the Council stood at 89 percent achieved and 11 percent not achieved. The performance status per programme was as follows:

  • Programme 1 – Umalusi achieved 83 percent and unachieved 17 percent
  • Programme 2 – Umalusi achieved 83 percent against 17 percent not achieved
  • Programme 3 – Umalusi achieved 100 percent.

 

9.1.3    Status of achievement per programme

9.1.3.1 Programme 1: Administration - Programme 1 covers the following sub-programmes:

  • Governance and Office of the Chief Executive Officer (GOCEO)
  • Public Relations and Communications (PR&COMMS)
  • Information Communication Technology (ICT)
  • Human Resource Management and Development (HRM&D)
  • Finance and Supply Chain Management (F&SCM)

 

Indicators Achieved or Over-Achieved

Indicators Under-Achieved

  • APP approved by 31March
  • Quarterly reports submitted to National Treasury (NT) and DBE 30 days after end of quarter
  • Number of communication platforms used
  • Percentage compliance against the requirements of the ICT Governance Framework
  • Percentage of performance agreements and assessment reports submitted on time
  • Percentage of service providers paid within 30 days

 

 

  1. Reasons for Under-performance – The under-performance was due to late approval of requisitions and reconciliation of creditors’ payments. Internal controls for managing all received invoices, as well as the reconciliation of invoices to supplier statements, were partially ineffective.
  2. Mitigation - The F&SCM Unit has embarked on a process of redesigning internal controls to be more preventative in nature and in line with the technical indicator description.

 

9.1.3.2 Programme 2: Qualifications and Research - Programme 2 covers the following sub-programmes:

  • Qualifications, Curriculum and Certification
    • Ensuring and enhancing the status and quality of qualifications on the sub-framework, which Umalusi develops, manages and reviews;
    • Evaluating curricula to ensure that these are of acceptable quality;
    • The certification of candidate performance for all qualifications on the GFETQSF; and 
    • Verifying all qualifications Umalusi and its predecessor, SAFCERT, have issued since 1992.

 

  • Statistical Information and Research- The mandate of this sub-programme is to:
    • Conduct research that is informed by the emerging needs of the education system so as to engage stakeholders towards innovative thinking;
    • Report on the key indicators of quality and standards in general and further education and training;
    • Establish and maintain databases; and
    • Lead research and analysis and provide statistical support and information across Umalusi.

 

Indicators Achieved or Over-Achieved

Indicators Under-Achieved

  • Number of reports produced on the management of qualifications in the sub-framework
  • Number of curricula evaluated annually
  • Percentage of error-free learner records for which a certificate is printed annually
  • Verification requests processed within 2 working days
  • Research reports completed
  • Datasets created within 21 working days

 

  1. Reasons for Under-performance – The under-performance was due to incomplete data submitted and delays in submission of additional data by assessment bodies.
  2. Mitigation – Development of a Standard Operating Procedure for data retrieval. Enhancements to the IT certification system were made to support the business rules and to implement the SOP. The technical indicator description (TID) has been defined in detail to ensure a standard, clear calculation of performance.

 

9.1.3.3 Programme 3: Quality Assurance and Monitoring - Programme 3 covers the following sub-programmes:

  • Quality Assurance of Assessment - This function entails the following:
    • External moderation of question papers;
    • External moderation of internal assessment;
    • Verification of monitoring of the assessment system;
    • Monitoring of the conduct, administration and management of assessment and examinations processes;
    • Management of concessions, assessment and examination irregularities;
    • External moderation of marking processes.
  • Evaluation and Accreditation - Quality assurance of provision and assessment through evaluation and accreditation of private education institutions and private assessment bodies. This entails ensuring that:
    • Standards of provision are determined, maintained and strengthened;
    • Systems are in place to quality assure the capacity of the private education and training institutions seeking accreditation to implement qualifications registered on the GFETQSF through an accreditation and monitoring process;
    • Systems are in place to quality assure the capacity of private assessment bodies seeking accreditation to assess qualifications registered on the GFETQSF.

Indicators Achieved or Over-Achieved

  • Number of quality assurance of assessment reports published
  • Percentage of question papers submitted that are approved
  • Number of assessment bodies audited for their state of readiness
  • Number of subjects where verification of marking is conducted per qualification
  • Number of learning areas/subjects where moderation of School Based Assessment (SBA)/International Cooperative Administration Support Services (ICASS) is conducted
  • Percentage of accreditation outcomes for private education institutions finalised within 12 months of site visit
  • Percentage of private education institutions monitored after being granted accreditation

 

The Council has introduced new approaches to validate performance information through the Performance Verification Committee. The Audit Action Plan was adding value in reducing the number of findings raised by Internal and External Auditors. Quarterly reviews assist in challenging senior managers on how they manage performance information. The oversight role of the Audit and Risk Committee and Council or EXCO holds management accountable for internal controls and under-performance.  

 

9.1.4    Human Resources

 

            9.1.4.1 Human Resources – Employment and Vacancies:

Salary Band

2017/2018 Approved posts

2018/2019

Approved posts

2018/2019 No. of employees

2018/2019 Vacancies

% of Vacancies

Top management

4

4

4

-

0%

Senior Management

10

10

10

-

0%

Professional qualified

61

64

55

9

14%

  •  

10

16

15

1

6%

  •  

42

42

41

1

2%

  •  

4

4

4

-

0%

  1.  

131

140

129

11

8%

 

9.1.5    Financial Matters

Restated (2018) - Revenue and expense recognition in the incorrect period resulted in a restatement of the 2017/18 financial year after financial statements were approved.

 

 

9.1.5.1 Statement of Financial Position

 

Table 1: Statement of Financial Position (Assets)

 

2019

2018 Restated

Assets

 

 

Current Assets

 

 

Cash and cash equivalents

52 305 745

59 849 806

Receivables from exchange transactions

5 029 763

5 158 620

Prepayments

409 612

-

 

57 745 120

65 008 426

 

 

 

Non-Current Assets

   

Property, plant and equipment

34 737 049

36 054 348

Intangible assets

20 329

34 685

Prepayments

-

6 554 335

 

34 757 378

42 643 368

 

 

 

Total Assets

92 502 498

107 651 794

 

 

Table 2: Statement of Financial Position (Liabilities)

 

2019

2018 Restated

Liabilities

 

 

Current Liabilities

 

 

Payables from exchange transactions

16 610 579

17 619 061

 

 

 

Non-Current Liabilities

 

 

Operating lease liability

10 375

7 071

Employee benefit obligation

4 661 000

4 788 000

 

4 671 375

4 773 071

Total Liabilities

21 281 954

22 392 132

Net Assets

71 220 544

85 259 662

 

 

 

Reserves

 

 

Revaluation reserve

8 484 261

8 484 261

Accumulated surplus

62 736 283

76 775 401

 

 

 

Total Net Asserts

71 220 544

85 259 662

 

Table 3: Statement of Financial Performance (Revenue)

 

2019 (R)

2018 Restated* (R)

 

 

 

Revenue

154 734 523

148 360 132

Revenue from exchange

26 191 523

23 748 132

Revenue from non-exchange transactions

128 543 000

124 612 000

 

 

 

Other income

6 737 277

4 641 507

Investment revenue

4 576 277

5 062 409

Total revenue

166 048 077

158 064 048

 

Table 4: Statement of Financial Performance (Expenditure)

 

2019 (R)

2018 Restated* (R)

Expenditure

 

 

Other operating expenses

27 141 045

19 914 667

Employee costs

73 617 488

67 614 409

Moderator and verifier costs

41 542 669

35 069 781

Travel and accommodation – local

18 040 573

17 572 407

Communication expenses

1 044 341

6 269 384

Certification expenses

8 183 342

5 814 393

Consulting and professional fees

5 861 070

3 882 141

Depreciation amortisation

3 218 644

3 371 847

Printing and stationery

1 438 026

2 059 703

Total Expenditure

180 087 198

161 568 732

Total Revenue

166 048 077

158 064 048

Total Revenue

-14 039 121

- 3 504 684

 

 

          9.1.5.2    Current Issues and the Way Forward - The external auditors raised the following material findings in the management report:

  • Revenue and expense recognition in the incorrect period

There were no significant findings reported on Supply Chain Management and predetermined objective.

 

          9.1.5.3    Reportable Matter (Update) – The tender regarding the renovation of a new Office Block was awarded to a Joint Venture with three (3) separate entities in March 2017 to the value of R36 million. Due to the allegations of irregularities on the part of service providers, the contract was cancelled and the matter reported to South African Police Services (SAPS), Special Investigating Unit (SIU), Construction Industry Development Board (CIDB), the Department of Basic Education (DBE) and National Treasury (NT). Umalusi has filed the matter at the High Court in Pretoria and is awaiting Court date.

 

            9.1.5.4 Accumulated Surplus -  National Treasury has granted the request to roll-over surpluses of R 52 million. A revised budget for 2019/20 was submitted to DBE. The approved surplus by National Treasury will be utilised for the following projects:

  • Renovation to new office block.
  • ICT infrastructure upgrade.
  • Enterprise Resource Planning.

 

            9.1.5.5 Irregular Expenditure – For the current year, payments for cell phone services were made without a valid contract – the total amount paid equal to R 1 863 861. The matter has since been addressed, a request for condonation will be tabled at the next Umalusi Council for approval.

 

In the previous Financial Year there were non-compliance with SCM Regulations condoned by Council to the value of R 11 309 382.00. The majority of the amount relates to the reportable matter concerning the building renovation tender not in full compliance with CIDB Regulation (R 10,989,407.00).

 

            9.2       South African Council for Educators (SACE)

The South African Council for Educators is established under the SACE Act (Act No. 31 of 2000). The core mandate of the South African Council for Educators is the following:

  • Compulsory registration of all educators;
  • Management of the Continuing Professional Teacher Development (CPTD) system and promoting and developing the teaching profession; and
  • Reviewing and maintaining ethical standards.

 

The Annual Performance Plan summarises the priorities of SACE as outlined in the Strategic Plan 2015/2020. The activities of SACE have been structured into five programmes as elaborated in the Annual Performance Plan:

  • Programme 1: Registration
  • Programme 2: Ethics
  • Programme 3: Continuing Professional Teacher Development Management (System)
  • Programme 4: Professional Standards
  • Programme 5: Policy and Research

 

9.2.1    Performance Delivery Environment

Both the Ministers of Basic Education and Higher Education and Training pledged their support for SACE to take over the responsibility of registering college lecturers in the Technical and Vocational Education and Training and Community Education and Training sectors. The Council commenced a process of conceptualizing the professionalization of the ECD sector in terms of the practitioners’ professional registration and adherence to the code of professional ethics and professional standards. 

 

The Minister of Basic Education’s Teacher Appreciation and Support Programme (TASP), which is co-chaired by SACE and DBE, has been used successfully to recognise and appreciate teachers through the National Teaching Awards (NTA), World Teachers’ Month / Day programme and others. The Minister’s School Safety Summit and the related Provincial Education Department (PEDs) summits, as well as SACE’s programme and campaign on Teachers’ Rights, Responsibilities and Safety started a process of addressing the scourge of violence on teachers and learners in our schools.  All the cases that were carried over in the last two years have been investigated during the period under review and will be finalised in the new financial year. During the period under review Council continued not to have access to:

  • Department of Justice and Constitutional Development’s (DJCS) national register for sexual offenders due to its unavailability at the time of writing this annual report; and
  • Department of Social Development’s (DSD) national child protection register since access is provided to the employers in terms of Children’s Act.

 

9.2.2       Challenges

  • While council took a decision to establish three additional SACE provincial offices in the Eastern Cape, Limpopo and Western Cape, it has not been able to acquire the physical office space due to challenges it faced in the property market sector during the bidding process. New measures to secure the offices in these three provinces, during the 2019/20, have been looked into with the assistance of the National Treasury.
    • The submission of training schedules by providers is a prerequisite for site visits. The CPTD providers who were not visited did not supply Council with their training schedules which made it difficult for the said site visits to be conducted. The Council, has initiated several strategies to mitigate against this state of affairs.  
    • There was a low turnout of applications from the new providers than was expected. This might be due to the shortage of providers who operate in the teacher development landscape given that it is a specialised field. As mitigation, Council will be rolling out provider forums across the provinces to advocate and mobilise potential and emerging providers. Strengthening of the advocacy drive through different media will also be explored alongside the use of flyers, websites, radio, face to face and other media platforms where feasible.
    • The majority of educators do not report (manually or electronically) their PD points to SACE. A new approach and strategy to support activities in the three types of PD activities with regards to Reporting.
    • The Council has previously carried cases over from one financial year to the next owing to a number of challenges, such as, institutional capacity, the unavailability of panellists and cases received towards the end of the financial year. Having trained a number of panellists at the end of 2017, they commenced work from 5 February 2018 and were given an on the job training first. From 1 April 2019 these panellists were hard at work to process and finalize all backlog cases from 2015/16, 2016/17, 2017/18 financial years. They also assisted to process new cases for the financial year 2018/19.
    • Many parents still continue to refuse Council access to their children to testify in disciplinary hearings or even to participate in investigations by the Council.
    • SACE has in the past always complained that some Provincial Departments of education were not Reporting their cases as required in terms of section 26 of the SACE Act. Pursuant to a meeting with the Department of Education, The Council received a commitment to comply with the prescripts of the Act. SACE and the DBE have drafted a protocol on the Reporting of cases in line with section 26. This protocol has been agreed to and is due for signature by the Provincial Departments of Education.

 

9.2.3       Programme Performance

 

9.2.3.1 Programme 1: Registration - The purpose of this programme is to register qualified educators and create sub registers for special categories, maintain and update educator database, and enhance the quality of the registration of teachers by introducing standards. Within this programme, SACE had two performance indicators as follows:

  • The number of new registered educators – The target was set at 38 000 and SACE reached a total of 29 765. A negative deviation of 8 235.

 

  • The number of educators updating and renewing their registration status – The target was set at 47 000 and SACE was able to reach a total of 34 986. A negative deviation of 12 014.

Despite the fact that this Programme did not achieve its two indicators’ targets, it performed fairly well with 29 765 out of 38 000 (78.32%) newly-registered educators. New educators in this context refer to all the educators who are registered with Council for the first time. The highest number of educators were registered in quarter 2 as compared to all other quarters because many schools of education or faculties of humanities’ graduation ceremonies take place between April and July. Also, 34 986 out of 47 000 (74.43%) educators’ registration updates and renewal were achieved. Quarter 4 recorded the lowest number of registration updates / renewals for the reporting period, with 7038 (20.11%) because of the long SAPS turnaround time in getting the police clearance certificates.

 

The negative deviation for the two indicators was created by various factors, including:

  • Introduction of the police clearance certificate; during the last quarter of the financial year, as the registration requirement. SAPS’s slow turnaround time resulted in many teachers postponing their registration from the last quarter of 2018/18 to the 1st quarter of 2019/20. Indeed, the chart on the next slides indicates that fewer new educators were registered in last quarter (quarter 4)
  • The SACE/DOH (Department of Home Affairs) collaboration assisted a great deal in clearing most of the foreign educator’s applicants’ fraudulent documents for entry into the country. Consequently, their registration was denied. This is also evident to the fact that, out of the 29765, Only 395 (1,32%) newly-registered educators were foreign nationals.
  • Most the teachers updating and renewing their registration are the academically qualified but professionally unqualified and have been given the last three years to study for the one-year Post Graduate Certificate in Education (PGCE). However, they failed to do so on several occasions. Therefore, their provisional or conditional status could not meet the revised registration requirements of producing proof of PGCE qualification or proof of university PGCE registration for 2019 as well as the police clearance. As a result, the number of educators updating or renewing their registration status was affected.

 

9.2.3.2 Programme 2: Ethics - The purpose of this programme is to promote ethical conduct among educators through the development and enforcement of the code of ethics as well as facilitate interventions and support for schools, educators and school communities on ethical matters. Within this programme, SACE had only two performance indicators with achievements as follows:

  • The number of educators to be trained on the code of professional ethics – The target was set at 10 000 and SACE was able to achieve 10 645 – a positive deviation of 645.

 

  • The number of cases to be concluded annually - The target for the number of cases was set at 550 but SACE was only able to reach 368. A negative deviation of 182 cases.

 

Programme 2 performed very well in terms of indicator number 1 - the number of educators capacitated on the Code of Professional Ethics. This could be attributed to the collaboration between the Ethics Division and other Divisions, such as, Professional Development, Communication and Teacher Professionalization. In terms of the second indicator, had a target of 550 cases to be concluded against the 633 received cases.

As a result, the second indicators performed at 60.9% (386 against the target of 550). The remaining 182 cases have been carried over into the next financial year. All in all, a total of 247 cases could not be finalized. This number includes additional 65 cases carried over, previously, into the 2017/18. All the 65 cases have been investigated and they are awaiting finalisation of the hearings and ratification by the Ethics Committee.

 

SACE received a total of 765 individual incidences reported against educators in the financial period under consideration. By incidences Council means that one complaint or file may have more than one incident or complaint in it. One educator may be accused of 2 or more kinds of breaches of the code of professional ethics, be it say corporal punishment, insubordination, absenteeism, and others. Only one file will be opened but will detail the incidences reported against such an educator.

 

9.2.3.3 Programme 3: Continuing Professional Teacher Development (CPTD) Management System - SACE has a responsibility to manage a system for continuing professional development with the support of the Department of Basic Education and the nine Provincial Education Departments. In line with this, SACE will:

  • Ensure that educators engage in life-long learning throughout their career.
  • Ensure that educators’ classroom practice and professional competence are improved through the provisioning of quality SACE approved providers and endorsed professional development programmes

Within this programme, SACE had six performance indicators as follows:

  • Number of practicing educators signed up for the CPTD system per year. disaggregated by cohort – The target was set at 50 000 PL1 educators and SACE was able to reach a total of 174 473 educators. A positive deviation of 124 473.
  • Number of signed up teachers who are engaged in three types of Professional Development (PD) activities from:
    • Type1: Self-initiated PD activity
    • Type 2: School initiated PD activity
    • Type 3: Externally initiated 

The target was set at 122 700 (Type 1) signed-up principals, deputies, HODs and all PL1 educators; 98 160 (Type 2) signed up principals, deputies, HODs and all PL1 Educators and 73 620 (Type 3) signed-up principals, deputies, HODs and all PL1 educators. SACE performed as follows:

  • Type 1 – 17 988 signed-up principals, deputies, HODs and all PL1 educators. A negative deviation of 104 712.
  • Type 2 – 3 912 signed up principals, deputies, HODs and all PL1 Educators. A negative deviation of 94 248.
  • Type 3 – 6 121 signed-up principals, deputies, HODs and all PL1 educators. A negative deviation of 67 499. 

 

  • Percentage (number) of signed up educators who meet the minimum requirement of 150 CPTD points over the three-year cycle. (disaggregated by cohort-principals and deputy principals, HODs, PL1 educators) – The target was set at 24 847 of all signed up HODs (Cohort2: 2015-2017) meet minimum requirement of 150 CPTD points by Dec 2017. SACE was only able to reach 934. A negative deviation of 23 912.
  • Number of new Professional Development providers processed in the year of submission (in-terms of approved status, not approved status, rejected and in process) - The target was set at 130 and SACE was only able to reach 81 new provider applications. A negative deviation of 49.

 

  • Number of new Professional Development Activities Processed in the year of submission (in-terms of endorsed status, not-endorsed status, rejected and in process) - The target was set at 750 new Professional Development and SACE was able to reach a total of 1 024. A positive deviation of 274.
  • Number of endorsed Professional Development Activities subjected to quality assurance by SACE in a financial year - The target was set at 160 activities processed. SACE was able to process a total of 75 leading to a negative deviation of 85.

 

In respect of the practicing educators signed up for the CPTD system per year, the target for the financial year under review was 50 000 educators to be signed up, the actual validated output is 174 473 and the variance is 124 473. The variance demonstrates an overachievement of sign-ups of registered educators. The overachievement, cited above is attributed to automated signed up that was implemented during the period between June 2018 to February 2019 in seven provinces (Limpopo, KwaZulu Natal, Mpumalanga, Northern Cape, North West, Free State and Eastern Cape).

 

Regarding CPTD Outreach Programmes, several outreach programmes have been conducted by Council at the behest of stakeholders such as unions, the Department of Basic Education and other partners as well those initiated by SACE. Outreach programmes incorporate events conducted within districts whose aim is to provide refresher courses on SACE programmes, such as, Registration and Teacher Professionalization, Ethics and Professional Development (CPTD), and this Report places its focuses on the latter. Outreach programmes were conducted in Mpumalanga and Kokstad.

 

Strategy to overcome areas of underperformance:

  • The Council has started embarking on a number of interventions with the objective of addressing inadequacies contributing to underperformance of the CPTD programme. These include the following:
  • The Council has embarked on human resource and performance management actions that includes, among other things, the review of CPTD coordinators Key Results Areas (KRA) to focus in helping schools and providers with reporting and as one way of enabling them to execute this assignment.
  • The Council has procured routers for internet connectivity for coordinators, which is aimed at ensuring that during their school visits, they are able to assist educators and schools with regards to Reporting Type 1 and 2 respectively.
  • In an attempt to improve the Reporting of type 3 activities, letters were written to providers requesting them to send through registers for capturing type 3 activities.
  • CPTD Providers were further requested to provide schedule of their planned training interventions or events, to enable CPTD coordinators to conduct site visits for quality assurance purposes and be able to collect attendance registers for capturing, unfortunately very few of them responded positively.

 

9.2.3.4 Programme 4: Teacher Professionalization – The purpose of this programme is to:

  • To develop a set of professional standards for teachers’ practice that is theoretically informed, contextually appropriate and widely accepted by stakeholders;
  • Develop various strategies and processes of assisting and supporting educators with regard to professional matters and needs;
  • Improve and maintain the status and image of the teaching profession;
  • Facilitate processes of ensuring that more and better teachers join the teaching profession; and
  • Ensure the quality of initial teacher education and ongoing professional development through quality assurance mechanisms and standards. 

 

Within this programme, SACE had only two performance indicators as follows:

  • Set professional practice standards for teaching – The target was set at ensuring that professional practice standards are approved and gazetted. This target was achieved as indicated.
    • Professional designation for teachers developed and registered – The target was for professional teacher designation piloted, finalised and registered on the SAQA Professional Bodies and Professional Designations searchable database. SACE was not able to achieve this target

The designation policy has been drafted and was presented to the Professional Development Committee of Council in October 2018 for noting. A business plan which indicates the timelines for policy developments and submission to Council structures was developed and will be submitted to the Council structures for adoption and tracking purposes. The professional standards for teachers’ practice were developed over a period of 24 months and Council subsequently concluded the adoption process in November 2018.

The Council has further ensured that the quality of initial teacher education and ongoing professional development is addressed by the inclusion of the draft PTSs in the review of Minimum Requirements for Teacher Education Qualifications (MRTEQ) as the (Appendix C: Basic Competences of a Beginner Teacher.

The Draft PTSs have also formed the bases of the Newly Qualified Teachers Professional Development Portfolio as per the proposed Teacher Professionalization Path 2019. The Approved Providers and Endorsed programme will be required to respond to the adopted Draft PTSs. This will ensure that quality assurance mechanisms and standards respond to the impact/effect on the system as defined in the National Development Plan as advocated. Provincial Teacher Education Committees (PTECs) have been established by the DHET in each province and SACE have been highly engaged in to inform these platforms on matters relating to Teacher Professionalization and SACE mandate at large.

The Council has developed a development plan to guide the process of preparing the sector for professional practice, implement consultative sessions with stakeholders, develop professional designation, set and implement professional standards. Designation policy has been developed and will be shared for public review. Teachers standards have been developed, approved by Council and submitted to DBE. SACE is maintaining continuous communication with DBE to ensure the flawless process that will lead to Gazetted. It should be noted that the process of gazetting is outside the realm of SACE.

The designation Certified Teacher has been researched and the results will be used to inform the process going forward. Consultations with the stakeholders and teacher unions in particular will continue. SACE to continue working with SAQA towards achieving recognition status as fully-fledged professional council still going on.

 

9.2.3.5 Programme 5: Research Policy and Planning – The purpose of this programme is to:

  • To enhance policy and research coordination within SACE.
  • To strengthen the SACE advisory role and service that is informed by policy, research, and consultative processes.
  • To promote research on professional matters and any other educational matter relevant to SACE.

Within this programme, SACE had four performance indicators as follows:

  • Number of research Reports produced in line with the SACE Research Policy and Agenda - The target was set at 3 reports produced. SACE was able to achieve this target with no deviation.
  • Number of policy advice and briefs produced per annum - The target was set at two produced. SACE was able to achieve this target with no deviation.
  • Number of provincial Practitioner based Research conferences/seminars held - The target was set at two and SACE was able to achieve this target with no deviation.
  • Establish the SACE resource centre and virtual library – The target was to ensure a resource centre and virtual library concept approved. This was achieved with no deviation.

 

Three joint Teacher Conferences were held: on the 08 September 2018, a conference was held in KwaZulu-Natal Province, Ixopo Combined School where code of professional ethics was reiterated to the educators. The second conference was held in Mpumalanga Ehlanzeni District at Hoerskool Rob Ferreira on the 9th of February. The third and final teacher conference was held on the 09th of March 2019 in Eastern Cape Kokstad, were a total of 216 teachers attended the conference. The activities during the conferences included: presentations from all council mandates, on location registration, re-print of the certificates, and updating information of the teachers.

 

The Council commissioned a research on Teacher Rights Responsibility and Safety in March 2019. The output from this was the literature review, conducting of focus groups in all 9 provinces and then the output of a handbook. The draft handbook was recently presented to the management of SACE and stakeholders. The focus group were conducted in all provinces, which consisted of the teachers, stakeholders, and provincial officials as respondents to the questionnaire.  This Programme has a draft output of a handbook that will be produced for teachers.  There will also be an advisory policy brief that will be submitted to the minister of Basic Education. The purpose of the handbook is to:

  • Sharpen educators’ understanding of rights, responsibilities and safety issues and their ability to act and respond appropriately when their rights and safety are being eroded;
  • Provoke thinking, debate and discussion about teachers’ rights, responsibilities and safety in the broader education field and teaching profession; and
  • Serve as a guideline in/outside of a classroom when issue of violence arises.

 

9.2.4    Annual Financial Statements

 

9.2.4.1: Statement of Financial Position

Figures in Rand

2019

2018

Assets

   

Current Assets

 

 

Receivables from exchange transactions

2 855 933

2 116 180

Cash and cash equivalents

96 869 381

69 772 815

 

99 725 314

71 888 995

Non-Current Assets

 

 

Property, plant and equipment

63 040 338

63 440 435

Intangible assets

2 656 763

1 312 201

 

65 697 101

64 752 636

Total Assets

165 422 415

136 641 631

Liabilities

 

 

Current Liabilities

 

 

Payables from exchange transactions

11 280 410

8 722 769

Unspent conditional grants and receipts

2 669 765

1 547 642

 

13 950 175

10 270 411

Total Liabilities

13 950 175

10 270 411

Net Assets

151 472 240

126 371 220

Accumulated surplus

151 472 240

126 371 220

 

 

Analysis of Financial Position

The total assets increased by 17 percent due to a retained surplus and cash equivalents.  Non-current assets remained unchanged with no acquisition of material capital assets. The current liabilities increased by 26 percent due to unspent grant and travel and accommodation account. The Council had an accumulated surplus increase of 17 percent due to unspent CPTD grant and salary account appointments made towards year-end.

 

9.2.4.2 Statement of Financial Performance

Figures in Rand

2019

2018

Revenue

   

Revenue from exchange transactions

   

Revenue

85 424 449

70 602 761

Other income

707 893

270 750

Interest received

3 922 820

2 800 390

Gain on disposal of assets and liabilities

4 410

4 954

Total revenue from exchange transactions

90 059 572

73 678 855

 

 

 

Revenue from non-exchange transactions

 

 

Transfer revenue

 

 

Government grants

14 877 878

8 303 124

Total revenue

104 937 450

81 981 979

 

 

 

Expenditure

 

 

Employee benefit costs

(44 491 354)

(33 648 716)

Depreciation and amortisation

(2 476 530)

(2 664 948)

Lease rentals on operating lease

(980 304)

(630 981)

Debt Impairment

(563 978)

(154 477)

Operating Expenses

(31 324 264)

(25 943 632)

Total expenditure

(79 836 430)

(63 042 754)

Surplus for the year

25 101 020

18 939 225

 

Analysis of Financial Performance

Revenue from operating transactions increased by 17 percent due to increased subscriptions. There was an increase of 44 percent on CPTD subsidy spending with a total revenue increase of 18 percent. Personnel expenditure increased by 24 percent as all vacant positions including four senior positions have been filled. SACE operating expenditure increased by 17 percent with a total expenditure increase of 21percent. SACE had a surplus of 25 million. Approval has been obtained to retain the surplus in improving ICT infrastructure, contingency and increasing client provincial contact points.

 

9.2.4.3: Statement of Changes in Net Assets

Figures in Rand

Accumulated Surplus

Total Net Assets

Balance at 01 April 2017

107 431 995

107 431 995

Changes in net assets

 

 

Surplus for the year

18 939 225

18 939 225

Total changes

18 939 225

18 939 225

 

 

 

Balance at 01 April 2018

126 371 220

126 371 220

Changes in net assets

 

 

Surplus for the year

25 101 020

25 101 020

Total Changes

25 101 020

25 101 020

 

 

 

Balance at 31 March 2019

  1. 472 240

151 472 240

Analysis of Changes in Assets

The total net assets increased by 20 percent due to retained surplus for the year. There was no acquisition of material non-current assets.

 

9.2.4.4: Statement of Cash Flow

Figures in Rand

2019

2018

Cash flows from operating activities

 

 

Receipts

 

 

Membership, registration, reprints and other receipts

85 577 878

69 433 634

Grants

16 000 000

9 743 000

Interest income

3 922 820

2 800 390

 

105 500 698

81 977 024

Payments

 

 

Employee costs

(43 692 808)

(33 872 977)

Payment suppliers and others

(31 294 741)

(22 282 381)

 

(74 987 549)

(56 155 358)

Net cash flows from operating activities

30 513 149

25 821 666

 

 

 

Net Cash flows from investing activities

 

 

Purchase of property, plant and equipment

(1 504 329)

(1 375 675)

Proceeds from sale of property, plant and equipment

6 201

25 573

Purchase of other intangible assets

(1 918 456)

(177 500)

Proceeds from sale of other intangible assets

-

3 222

Net Cash flows used in investing activities

(3 416 583)

(1 524 380)

 

 

 

Cash flows from financing activities

 

 

Repayment of AFTRA deposits

  •  

(155 560)

 

 

 

Net Increase in cash and cash equivalents

27 096 566

24 141 726

Cash and cash equivalents at the beginning of the year

69 772 815

45 631 089

 

 

 

Cash and cash equivalents at the end of the year

96 869 381

69 772 815

 

 

 

 

 

 

 

 

Analysis of Cash Flow

Cash flow into SACE increased by 22 percent with the net cash flow from operations increasing by 1 percent. Africa Forum of Teaching Regulatory Authorities (AFTRA) deposits were temporarily held in SACE account while AFTRA was in the process of opening its account facilities. Net cash flows increased by 11 percent. Cash and cash equivalents stood at R 96.9 million.

 

9.2.4.5 Audit Report

SACE received an unqualified audit opinion for 2018/19. There were a few misstatements of information identified and corrected.

 

  1. Portfolio Committee Observations Members noted the general outcry in respect of violent activity at schools that seemed to be due to negligence/absence of educators. Members queried how SACE was addressing the current poor image of our educators.
  • In respect of corporal punishment Members queried whether SACE had engaged educators on alternate methods/measures to be utilised.
  • Members noted the regression of Umalusi audit and queried how the Council would ensure that their internal controls would be strengthened.
  • Members also queried the verification of certificates by Umalusi when this was not in their mandate.  Members noted with concern that the vacancy rate at Umalusi was fairly high with high staff turnover. Members queried how this affected the work of Umalusi – and where the current vacancies were located in the organogram.
  • Members also queried reasons for the delay in certification, specifically for TVET Colleges.
  • Members queried the processes for ECD practitioners receiving the necessary qualifications – and the duration for attaining such qualifications.
  • Members queried how the newly introduced General Education Certificate would impact on the mandate of Umalusi.
  • Members noted the SACE engagements with educators and queried what the recommendations to assist educators had emerged - and whether these recommendations could be shared with the Portfolio Committee.
  • In respect of incidents of sexual abuse, Members queried why SACE was not able to report these to SAPS as they become aware of them for investigation. There were provinces who were not reporting on such cases (not that they did not exist). Members needed to understand what SACE was doing to encourage provinces to report matters.
  • Members also queried when SACE provincial offices would be established in all provinces.
  • Members queried the processes and timeframes for the clearance certificates for foreign educators. Members further queried the current statistics on foreign educators in the system.
  • Members noted that Umalusi had experienced a decrease in their budget – but their targets had not been decreased – how this affected the work of Umalusi.
  • Members also queried the rationale for using consultants when Umalusi could employ such expertise on a fulltime basis.

 

10.       Responses by Umalusi and SACE

10.1 Umalusi – The Council was looking to improve its internal controls and produce an improvement plan on all findings of the Audit Committee. In respect of verification of certificates, Umalusi continued to verify certificates issue by Umalusi. The Council was in engagements with SAQA in respect of areas on contestation on the new envisaged legislation to be promulgated for implementation. The Council had also advised the Minister on matter pertaining to on-line/distance centres.

 

The vacancy rate may be due to two important areas i.e. workload and employee categorisation. The Council was losing institutional memory with the high staff turnaround. With the employee categorisation, it was evident that one group was being better remunerated than the other. The Council had brought the vacancy rate matter to the attention of the Minister and Department. It was compulsory for staff leaving the employ of Umalusi to serve a 30-days’ notice. Umalusi used this time to do the necessary recruitment and appointment of new incumbents. Regarding the use of consultants, much of the work of Umalusi was seasonal and it would be fruitless to employ experts on a full-time basis. It was less expensive to utilised these specialised services if, and when required. Currently the vacancy rate has been reduced to 6 percent and there were only eight staff that still needed to be appointed.

 

The backlog with certification was mainly due to the non-payment of private TVET Colleges. The Council was engaged with the Department of Higher Education and Basic Education on the matter. The Council also highlighted the challenges in respect of the reliability of learner data-sets for individual candidates.

 

In respect of the General Education Certificate (GEC), Umalusi indicated that the Department needed to submit the qualification for registration. If Umalusi was satisfied with the GEC, it will be registered with SAQA. There would be a need to increase capacity to adequately quality assure the GEC once it was received by Umalusi. Umalusi quality assured a huge system and only had a limited budget to do so. There was a need to ensure that the Umalusi budget was increased substantially for it to be effective in its work.

 

10.2 SACE – SACE currently had around 11000 registered foreign educators on their system. The Foreign Educators clearance and screening comprised police clearance, verification of qualifications and verification of entry permits. SACE collaborated with the Department of Home Affairs to verify entry permits of Foreign Educators. SACE was in agreement with intergovernmental relations in respect of the child protection register. The Council was continuing to ensure provincial offices being established – this was ongoing and in phases as SACE had limited budget. There was agreement on societal issues impacting on schools and there was a need to establish a formal relationship with the SA Council of Churches as a platform to engage communities on societal ills. SACE was also engaging with PEDs to ensure that sexual abuse cases needed to be reported to SAPS.

 

Educators had raised many issues with SACE on policy implementation which SACE needed to share with the Minister and Department to strengthen implementation. SACE would share its findings and report on roadshows with the Portfolio Committee.

 

SACE was still in the process of buying its own property but this has been delayed due to limited and high bids received. This process was ongoing and SACE was of the view that leasing was not an option. rather that leasing.

 

 

11. Overall Portfolio Committee Recommendations

 

Based on the observations made from inputs received, the Portfolio Committee requests that the Minister ensure that the Department consider the following recommendations:

 

  • Provide Parliament with a comprehensive Action Plan with timeframes to address the 2018/19 AGSA’s audit findings, within two months of the adoption of this report by the National Assembly. The Department is also requested to report quarterly on progress made in addressing the deliverables of the Action Plan. The Action Plan should include a focus on how the Department will address the following:
  •  
  • The internal control deficiencies regarding the monitoring and accounting of the ASIDI programme, including immovable tangible capital assets and controls to prevent and detect instances of non-compliance when procuring goods and services
  • Irregular expenditure as well as fruitless and wasteful expenditure
  • Findings with regard to planned targets in Programme 2 and reported performance information in Programmes 3 and 4.

           

 

  • Intensify the implementation of consequence management for errand companies and officials of the Department, including addressing delays in the procurement of new contracts to replace non-performing contractors.
  • Ensure that all prior audit findings are addressed adequately. The Internal Audit Committee should work closely with management and AGSA on the issues raised during the audit to moderate material misstatement and significant changes in the finalisation of the annual report
  • Intensify the support to the relevant Provincial Education Departments to ensure effective and efficient utilization of conditional grants, particularly the Learners with Severe to Profound Intellectual Disabilities conditional grant which continues to underperform.
  • Ensure that leadership oversight from Deputy Director-General, Chief Director and Director levels becomes more effective in certain areas. Branches should improve intensive quality assurance.
  • Deal swiftly with capacity challenges in ASIDI, Finance and Supply Chain Management. Also ensure that there are regular monthly reconciliations prepared to prevent misstatements in the financial statements.
  • Consider taking action against PEDs who do not comply with equity provisions by the Department.
  • Put more effective/stringent penalties against Implementing Agents who perform poorly in relation to the ASIDI programme.
  • Together with relevant authorities, fast track the implementation of plans to allocate ring-fenced funds for learner transport.
  • Consider appointing technical expertise/technical professionals and have them based in needy PEDs for them to be much more effective.
  • Based on the Department of Basic Education comprehensive briefing and presentation on the proposed Grade 9 Exit Certificate (General Education Certificate (GEC)), public awareness program is recommended in all provinces to ensure that critical stakeholders are informed of GEC.

 

  1. Portfolio Committee Recommendations to the South African Council for Educators (SACE)
  • Submit an action plan, with reasonable targets and time-frames in response of actions on issues raised by the Auditor-General.
  • Take the necessary steps to address the current poor image within the sector.
  • Ensure constructive engagement with educators in respect of alternate methods/measures of punishment to be utilised.
  • Ensure that PEDs are encouraged and assisted with reporting cases of sexual misconduct at SAPS where found.

 

  1. Portfolio Committee Recommendations to UMALUSI
  • Submit an Action Plan, with reasonable targets and time-frames in response of actions on issues raised by the Auditor-General. Umalusi should also submit a progress report to the Portfolio Committee on the implementation of the Action Plan during the Third Quarter of 2018/19.
  • Ensure that Internal Controls within the Council are strengthened.
  • In collaboration with the Department, fast-track the filling of all vacancies within the organisation as this negatively affects the work of the Council.
  • Consideration should be made to increase the budget of Umalusi due to its expanded mandate.

 

Report to be considered.