ATC150511: Report of the Portfolio Committee On Police On The 2015/16 Budget, Annual Performance Plan And 2015/16-2019/20 Strategic Plan Of The Private Security Industry Regulatory Authority (Psira), Dated 07 May 2015:

Police

REPORT OF THE PORTFOLIO COMMITTEE ON POLICE ON THE 2015/16 BUDGET, ANNUAL PERFORMANCE PLAN AND 2015/16-2019/20 STRATEGIC PLAN OF THE PRIVATE SECURITY INDUSTRY REGULATORY AUTHORITY (PSIRA), DATED 07 MAY 2015:

The Committee examined the Budget, Annual Performance Plan for the 2015/16 financial year and the 2015/16-2019/20 Strategic Plan of the Private Security Industry Regulatory Authority (PSIRA). The Committee reports as follows:

INTRODUCTION

The Private Security Industry Regulatory Authority was established in terms of section 2 of the Private Security Industry Regulation Act (2001). The entity is mandated to regulate the private security industry and to exercise effective control over the practice of the occupation of security service providers in the public and national interest, and in the interest of the private security industry itself. The Private Security Industry Regulatory Authority is currently being managed in terms of the Private Security Industry Regulatory Authority Act (2001), which replaced the Security Officers Act (1987).

Structure

The Report provides an overview of the 2015/16 Budget Hearings of the PSIRA and is divided into the following sections:

Section 1: Introduction. This section provides an introduction to this Report as well as a summary of meetings held during the hearings.
Section 2: Key concerns of the Committee during the 2014/15 financial year. This section provides a summary of the key concerns raised by the Committee during the previous financial year.
Section 3: Strategic Priorities of the PSIRA for the 2015/16 financial year. This section provides a summary of the strategic focus areas for the Authority for the year under review.
Section 4: PSIRA Budget and Performance targets for 2015/16. This section provides an overall analysis of the operating expenditure and revenue of the PSIRA for the 2015/16 financial year. This section also provides a programme analysis of the Authority.
Section 5: Committee observations. This section highlights selected observations made by the Portfolio Committee on Police on the annual performance targets and programme specific issues during the 2015/16 budget hearings and subsequent responses by the Authority.
Section 6: Recommendations and additional information. This section summarises the recommendations made by the Portfolio Committee on Police, as well as the additional information requested from the Authority.
Section 7: Conclusion. This section provides a conclusion to this Report.

Meetings held

In preparation for meetings with the Authority, the Portfolio Committee on Police invited stakeholders to comment on the 2015/16 Budget and APP of PSIRA on 14 April 2015. The following comments were made.

African Policing Civilian Oversight Forum (APCOF): The accountability and oversight mechanism in the PSIRA need to be strengthened. It was recommended that the new legislation, regulatory and institutional mechanisms address the need for greater accountability and reporting on transgressions by the sector. This should include data on offences by security officers including domestic violence, deaths, discharge of a firearms, use of force and issuing of equipment by the industry.
Police and Prison Civil Rights Union (POPCRU): The Union stated that the challenges within the private security industry have manifested themselves in many ways which includes non-compliance and lack of proper accountability. The Union made a call to President Zuma to approve the Private Security Regulatory Authority Amendment Bill, 2013, which will strengthen the regulatory oversight of PSIRA, and ensure regulatory compliance in the private security industry.

Further to the preparations, the Committee also received an overview of the budget for the financial year under review by the Research Unit of the Parliament of South Africa on 24 April 2015. The Committee received the following briefing from the Authority:

Briefing on the Strategic and Annual Performance Plan and 2015/16 Budget, operating expenditure, revenue and performance targets.

Key concerns raised by the Committee during the 2014/15 financial year

The following section provides a summary of the key observations/concerns raised by the Portfolio Committee on Police regarding performance and financial issues identified during the 2014/15 financial year:

Head Office Lease

The Committee raised several issues of concern regarding the relocation of PSIRA’s corporate head office from Arcadia to Centurion. The Committee expressed their strongest opposition against the process taken in the relocation of offices of the Authority. The Committee further encourage the Authority to expedite the disposal of the Arcadia premises.

Appointment of CFO

The Council appointed another CFO on a 6 month contract and recruitment for a permanent position will commence in March 2015.

Leadership and capacity of Council

The Committee raised concerns around the apparent lack of leadership and the inadequate capacity of the Council of the Authority, as the Council is mandated with the governance of the Authority.

Research

The Committee raised concern regarding the lack of performance in the Strategic Priority 1: Industry Stewardship (Knowledge and Advocacy), in which priority research projects to be completed was prioritised and only topics were identified.

Contingent liability

The Committee expressed concern regarding the fact that the Authority is not budgeting for contingent liabilities and further stated that the Authority has continuously ignored the recommendation made by the Committee to budget for contingent liabilities.

Difference between satellite and regional offices

The Committee questioned what the difference between satellite offices and regional offices are and expressed concern regarding possible labour brokering practices at these offices.

STRATEGIC PRIORITIES OF THE PSIRA FOR 2015/16

The Authority’s 5-year Strategic Plan (2015/16-2019/20) notes that the following strategic priorities/goals will receive attention and will be at the centre of the Authority’s operations during the 2015/16 FY and over the medium term period:

Priority 1: Excellent service delivery (effective regulation)
Priority 2: Effective financial management
Priority 3: Industry stewardship, stakeholder and customer relationship management
Priority 4: Enabling environment with competent and skilled workforce
Priority 5: Efficient and effective processes and systems

More so, pursuant to its mandate, the Authority also indicated in its Strategic Plan that, over the medium term, a focus will also be put on the following strategic objectives:

Ensure good governance and a sound financial control environment;
Ensure that PSIRA has in place effective and reliable IT Systems;
To ensure that PSIRA has a competent, ethical and skilled workforce;
To ensure effective regulation in the security industry;
Enforce minimum standards of occupational conduct in respect of security service providers;
Promote awareness amongst the public and the private security industry on the functions and role of PSIRA in the industry;
Promote the protection and enforcement of the rights of Security Officers and other employees in the Private Security Industry;
Promote the interest of the consumers of private security service;
To ensure that the registration process is transparent and timeous;
Promote high standards in the training of security service providers and prospective security service providers (SSP); and
Ensure that PSIRA is a centre of excellence in private security research.

Table 3 below provides a summary of the responsibilities of each Programme as linked to the above strategic priorities and objectives.

Table 1: Programme responsibilities and outcomes for 2015/16

Programme Responsibilities
Programme 1: Administration	Programme 2: Law Enforcement	Programme 3: Communications, Registration (CRM) and Training
Responsible for the overall strategic management and support service of the Authority	Responsible for enforcing compliance with minimum standards of occupational conduct by security service providers and legal services to ensure efficiency in the prosecution of the contraventions of the PSIRA Act.	Responsible for Stakeholder Management and Communications, Registration and Customer Relation Management, Industry Training, Research and Development.
Outcomes per Programme
Outcome 1: Effective revenue management Outcome 2: Sustainable funding model Outcome 3: Compliance to Corporate Governance and IT Standards Outcome 4: Competent and performing workforce	Outcome 5: Increased monitoring and investigation of security service providers to ensure compliance with existing legislation. Outcome 6: Increased compliance to minimum standards of occupational conduct of security service providers. Outcome 7: Security business licensed to possess firearms in the private security industry is fully accounted for. Outcome 8: Increased compliance to minimum professional standards in training of security service providers.	Outcome 9: Effective and efficient registration process. Outcome 10: Improve the integrity of PSIRA registration certificates Outcome 11: Increased protection and enforcement of private security personnel rights. Outcome 12: Increased awareness on the functions and role of PSIRA in the industry. Outcome 13: Increased efficiency of resolving consumer complaints Outcome 14: Research to strengthen core business and support external initiatives (Law Enforcement, Registration, Industry Training, Marketing, Brand Communication and Stakeholder Management). Outcome 15: Research to strengthen core business and support external initiatives.

PSIRA BUDGET AND PERFORMANCE TARGETS FOR 2015/16

Overall analysis

The PSIRA is not funded by any government funding, its revenue streams include annual registration fees from security service providers, fines issued in terms of Code of Conduct enquiries, and other disbursement fees on cost recovery basis.

The Authority has had a difficult financial history over the past decade. The financial position of the Authority was stable in 2003/04, but declined over the following two years up until 2006/07, when PSIRA recorded its first deficit. The Authority performed slightly better in 2007/08 when a small surplus of funds was recorded. However, between 2008/09 and 2012/13 the Authority recorded significant deficits. These deficits were mainly ascribed to rising expenditure while revenue remained stagnant, mostly as a result of the failure to review the annual fees on a regular basis. The operating expenditure of the PSIRA increased by more than 300 per cent over the past decade and while their revenue has increased by 190.9 per cent over the same period it is clear that there was a disjuncture between their revenue and expenses. In layman’s terms, one can say that PSIRA started to operate above their means a decade back as their expenditure increased disproportional to their income.

In 2014/15 FY, the Authority’s revenue was R185 948 million and its operating expenditure was R168 461 million, resulting to a small surplus of R17 487. The 2014/15 surplus seems to indicate that there is a semblance of financial stability. In 2015/16, the Authority’s revenue is projected at R199 657 million and there is no surplus/deficit projected.

The table below shows the operating budget allocation and expenditure estimates of PSIRA for the 2015/16 FY per Programme compared to the previous financial year (2014/15). The allocation to two programmes shows an increase, (Programme 2 and Programme 3) while one programme reflects a decrease (Programme 1).

Allocation and projected expenditure for the Administration programme is R82.3 million for 2015/16 FY compared to R91.1 million in 2014/15 FY. In nominal terms, this represents a decrease of R8.8 million and a real percentage decrease of 13.81 per cent. Nonetheless, the Administration Programme also has the largest expenditure of the three programmes. The allocation and expenditure estimates for the Law Enforcement Programme (Programme 2) are estimated to increase from R60.7 in 2014/15 FY to R73.1 million in 2015/16 FY. This represents a nominal increase of R12.4 million or real percentage change of 14.9 per cent. The Communication, Training and Registration Programme’s allocation and expenditure are expected to increase from R16.5 million in 2014/15 FY to R44.1 million in 2015/16 FY. This represents a nominal increase of R27.5 million or 154.5 per cent (real percent change).

Table 2: Operating Budget per programme

Programme	Budget		Nominal Rand change	Real Rand change	Nominal % change	Real % change
R million	2014/15	2015/16	2014/15-2015/16		2014/15-2015/16
Programme 1: Administration	91 173.0	82 354.0	- 8 819.0	- 12 590.9	-9.67%	-13.81%
Programme 2: Law Enforcement	60 705.0	73 151.0	12 446.0	9 095.6	20.50%	14.98%
Programme 3: Communication, Training and Registration	16 583.0	44 152.0	27 569.0	25 546.8	166.25%	154.05%
Total	168 461.0	199 657.0	31 196.0	22 051.4	18.52%	13.09%

Source: PSIRA 2015/16 APP

The bulk of the Authority’s allocation over the medium term will go towards the Administration programme. According to the 2015/16 APP, this is “mainly for procuring the enterprise resource planning system, which will help to ensure that there is greater efficiency in the authority’s operations and processes”. While the organisation’s current system is outdated and costly to maintain, the new system will allow greater technical functionality and have fewer maintenance costs. It was reported that this business re-engineering process will help to reduce the turnaround time for new registrations from an average of 30 days in 2012/13 to an average of 10 days by 2017/18. In addition, the enterprise resource planning system is expected to reduce the number of fraudulent registrations of individuals and businesses wanting to enter the industry, in line with the agency’s objective of exercising effective oversight of the private security industry.

The overall revenue of the Authority is expected to increase significantly over the medium term from the revised estimates of R185.9 million in 2014/15 to R220.6 in 2017/18 FY. This will represent a real percentage change of an increase of 2.45 per cent. Administrative fees will continue to be the main source of revenue generation for the Authority, if things stay as they are- in other words, if there is no alternative revenue generation model. As stated in the 2015 ENE, the Authority expects its total revenue to grow moderately, at an average annual rate of 6 per cent over the medium term. The main contributor to this growth is expected to be revenue collected from administrative fees, in line with the anticipated increase in the number of registered security officers over the medium term. Other contributors to this growth include the reissuing of certificates and identity documents to security companies and security officers, and the renewal of annual fees. The Authority does not anticipate any surplus over the medium term.

Programme Analysis

Programme 1: Administration

The Administration Programme is responsible for the overall strategic management and support service of the Authority. The Programme has the following strategic outcomes:

Effective revenue management
Sustainable funding model
Compliance to Corporate Governance and IT Standards
Efficient and secure IT systems
Competent and performing workforce

The budget of Programme 1: Administration has decreased from R91.1 million in 2014/15 FY to R82.3 million in 2015/16 FY. This decrease is projected to continue in the next financial year (2016/17) and although it’s projected to increase in 2017/18 FY, it is not going to reach the 2014/15 FY allocation. The large portion of the Programme’s budget will go to personnel expenditure.

Table 3: Programme 1: Administration- 2015/16 Budget

Standard Item Expenditure R thousand	Audited Outcomes			MTEF
Standard Item Expenditure R thousand	Actual 2011/12	Actual 2012/13	Actual 2013/14	Budget 2014/15	Budget 2015/16	Budget 2016/17	Budget 2017/18
Personnel expenditure	25 313	30 024	29 625	29 979	33 876	36 084	39 121
Administrative expenditure	41 245	17 851	29 960	35 870	23 623	26 761	29 266
Repair maintenance	722	1 863	2 362	2 603	774	503	566
Travel and subsistence	797	1 188	949	1 469	1 912	1 994	2 104
Lease payments	10 352	11 687	10 892	18 649	14 749	7 658	6 771
Consultancy& Professional	4 581	3 590	2 906	2 603	7 420	5 735	4 965
TOTAL EXPENDITURE	83 010	66 203	76 694	91 173	82 354	78 735	82 793

Source: 2015/16 PSIRA APP

Most of the performance indicators and targets set for the Administration Programme remained unchanged over the past financial year- though some were reworded/rephrased. These include:

· The Performance indicator on audits has been divided into two indicators – one measuring the percentage of audit findings resolved (targeted as 100% for 2015/16) and one measuring the attainment of an unqualified audit opinion.

· Note that the Performance Indicator on Percentage of employees achieving a performance rating of over 3 is noted as a new indicator but in fact a target of 90% achievement was already set for 2014/15.

Programme 2: Law Enforcement

Programme 2: Law Enforcement is responsible for enforcing compliance with minimum standards of occupational conduct by security service providers and legal services to ensure efficiency in the prosecution of contraventions of the PSIRA Act. The Programme has the following strategic outcomes:

Effective revenue management
Sustainable funding model
Compliance to Corporate Governance and IT Standards
Efficient and secure IT systems
Competent and performing workforce

The budget of the Programme has increased from R60.7 million in 2014/15 FY to R73.1 million in 2015/16 FY. This increase is projected to continue over the medium term until 2017/18 FY. The large portion of the Programme’s budget will go to personnel expenditure followed by administrative expenditure.

Table 4: Programme 2: Law Enforcement- 2015/16 Budget

Standard Item Expenditure R thousand	Audited Outcomes			MTEF
Standard Item Expenditure R thousand	Actual 2011/12	Actual 2012/13	Actual 2013/14	Budget 2014/15	Budget 2015/16	Budget 2016/17	Budget 2017/18
Personnel expenditure	33 206	40 680	40 051	44 362	51 576	57 522	61 992
Administrative expenditure	5 616	5 374	9 863	8 280	10 470	11 090	11 679
Repair maintenance	118	294	145	270	153	167	175
Travel and subsistence	3 797	1 634	2350	3 616	6 966	7 926	9 182
Lease payments	1 977	2 581	3034	3 377	3 906	4 143	4 429
Consultancy& Professional	152	550	601	800	80	84	89
TOTAL EXPENDITURE	44 866	51 113	56 044	60 705	73 151	80 932	87 546

Source: 2015/16 PSIRA APP

In the 2014/15 APP, the Law Enforcement Programme had no listed sub-programmes, but this was corrected in the 2015/16 APP. The following performance indicators are new (were not stated in the 2014/15 APP):

% of site inspections conducted at the retail sector
% of inspections conducted at health service sector
% of inspections conducted at educational facilities
% of inspections conducted at industrial and corporate facilities
% of site inspections conducted at residential areas

Two indicators are recorded as new indicators even though targets were already set for them in the 2014/15 APP. These are:

Percentage of inspected SSPs (businesses) complying with the minimum standards per year (target of 60% for 2014/15)
Percentage of inspected SSPs (Security Officers) complying with the minimum standards per year (target of 60% for 2014/15)

Two indicators have incorrect targets stipulated as the baselines for 2014/15 (or do not reflect that these targets as stipulated in the 2014/15 were not achieved). These are:

Number of security businesses inspected to assess compliance with the PSIR Act (target of 3 870 set for 2014/15 and not 3 520 which was the target set for 2013/14); and
Number of security officers inspected to assess compliance with the PSIR Act (target set of 22 270 and not 20 244 which was the target set for 2013/14).

Programme 3: Communications, Registration and Training

Programme 3: Communications, Registration and Training is responsible for stakeholder Management and Communication, Registration and Customer Relations Management, Industry Training, Research and Marketing. The Programme has the following strategic outcomes:

Increased compliance to minimum professional standards in the training of SSP’s
Effective and Efficient registration process
Improve the integrity of PSIRA registration certificates
Increased protection and enforcement of Private Security Industry Personnel rights
Increased awareness on the functions and the role of PSIRA and the industry
Increased efficiency of resolving consumer complaints
Research to strengthen core business and support external initiatives (law enforcement, registration, industry training, marketing, brand communication and stakeholder management)

The budget of the Programme has increased from R16.5 million in 2014/15 FY to R44.1 million in 2015/16 FY. This increase is projected to continue over the medium term until 2017/18 FY. The large portion of the Programme’s budget will go to personnel expenditure followed by administrative expenditure.

Table 5: Programme 3: 2015/16 Budget Communications, Registration (CRM) and Training

Standard Item Expenditure R thousand	Audited Outcomes			MTEF
Standard Item Expenditure R thousand	Actual 2011/12	Actual 2012/13	Actual 2013/14	Budget 2014/15	Budget 2015/16	Budget 2016/17	Budget 2017/18
Personnel expenditure	6 325	5 927	6 721	8 649	10 778	11 586	12 455
Administrative expenditure	4 915	5 504	8 470	7 622	31 068	35 387	35 427
Travel and subsistence	47	156	489	240	1 560	1 667	1 790
Lease payments	52	79	68	55	96	102	107
Consultancy and Professional	185	15	215	17	650	482	506
TOTAL EXPENDITURE	11 524	11 681	15 963	16 583	44 152	49 224	50 285

Source: 2015/16 PSIRA APP

COMMITTEE OBSERVATIONS

General

The Committee made the following general observations during the 2015/16 budget hearings:

Governance Framework: The Committee welcomed the directive from the Minister of Police to the Council of PSIRA to embark on a thorough review of its governance framework to align it to the King III guidelines. The review includes the following aspects of which the Committee requested a progress report:

Appointment of new Chairperson: The Committee welcomed that the appointment of the new Chairperson of the PSIRA Board, Professor Ntombifikile Mazibuko and wished her success in her new role.
Council Charter: The Committee noted that the review also includes the development of a Council Charter guided by the King III guidelines. The Committee also welcomed this development.

Erratum on incorrect figures: The Authority highlighted several mistakes in its 2015/16 APP, which include the omission of a table on the quarterly targets for the sub-programme: Human Capital (Administration Programme) and the incorrect statement of the percentage of inspected SSPs (both businesses and officers) as new performance indicators. The Authority stated that an erratum will be tabled.

Lease of corporate Head Office: The Committee stated that the lease agreement of the PSIRA Corporate Head Office lease will lapse in July 2016 and requested the Authority to indicate what contingency measures have been taken in this regard. The Authority stated that the lease was extended for one year to the cost of R10 million per annum. The Authority stated that there remains significant uncertainty regarding the future of its old premise in Arcadia. It was further stated that the feasibility study by National Treasury is still in flux and will be completed soon. The Minister of Police has the final determination on the Arcadia premises. The Committee encouraged the Authority to do everything in its power to expedite the process.

Expansion of private security to poor areas: The Committee stated that the majority of aggravated robberies take place on streets and noted that the private security can play a crucial role in alleviating the burden of the SAPS through increased visibility. The Committee further stated that private security is a luxury service affordable only by affluent communities and that the extra layer of security provided through private security should be accessible to less affluent and indeed poor communities. The Authority should play a leading role in ensuring equitable ownership to poor communities and requested the Authority to indicate the steps take to engage the industry. The Authority stated that that companies must review their models to provide access to poor areas and that the Authority has started engagements through workshops, specifically aimed at businesses that want to enter the industry. The Committee encouraged the Authority to prioritise these engagement and play a leading role in the transformation of the industry to allow for an equitable spread of services to all communities.

PSIRA Amendment Bill, 2013: The Committee requested an update on the status of the PSIRA Amendment Bill, 2013. The Authority stated that the Amendment Bill has received significant criticism and is still due for signature by the President.

Integrity: The Committee requested the Authority to indicate whether the Senior Management Structure (SMS) is vetted and have valid security clearance certificates. The Authority stated that the process in underway and that only the Director of PSIRA has clearance.

Programme 1: Administration

The Committee made the following observations during the 2015/16 budget hearings on Programme 1: Administration:

New Information Technology (IT) system and subsequent consultants: The Committee raised concern about the development of a new IT system, specifically regarding the budget allocations towards the software and consultancy fees associated with the development. In total, the Authority will spend R35 million on the software alone across the medium term. The Committee raised concern around the training of employees and the transfer of skills. The Authority stated that the new IT plan was presented to Council and approved. The project runs across the medium term (2015/16 – 2017/18) and will be finalised in the outer year of the MTEF. The project forms part of the Business Process Reengineering plan and will be phased into the organisation. The new system will first focus on the most crucial aspects of the organisation, which is registration and billing. The contract has a strict governance framework attached to it and includes penalty clauses for any overruns, which is overseen by the Audit Committee.

Security Industry Alliance (SIA) court case and new fees structure: The Committee requested an update on the impact of the SIA court judgment (in favour of the SIA) on the newly developed tariff regulations and also requested an update on the consultation process following after the Draft Regulations were gazetted in February 2015. The new regulations took on board comments and arguments by the Supreme Court of Appeal (SCA) and provisions of the Promotion of Administrative Justice Act (PAJA), 2000 (Act 3 of 2000). The consultations were open for four weeks and included consultative workshops in all provinces. The final new Annual fee regulations come into effect on 01 April 2015 and refunds and credit notes will be adjudicated after the finalisation of the new annual fees. The Authority provided some detail on the comments received on the published fees regulations and noted that most submissions expressed satisfaction with the new fee structure. The Authority further stated that the key cutting fraternity poses a challenge as it had submitted that most key cutting businesses are a ‘one man band’, but that the Authority needs to establish the validity of these claims. The Committee asked why the Authority based the fees on the size of companies and not the turn-over of companies. The Authority stated that it does not have the information and has no way of verifying the information provided by companies (if they did provide such). Additionally, the Authority stated that the fees will be reviewed when the Private Security Levies Act, 2002 comes into operation and will then be based on the turn-over of companies as the Act requires companies to declare turn-over.

Revenue: The Committee raised concern about the lack of a comprehensive breakdown of the Authority’s estimated revenue for the 2015/16 financial year. The inclusion was also request by the previous Committee and an explanation for the omission was requested. The Authority stated that the breakdown in terms of economic classification was not purposefully omitted and will be provided to the Committee.

Surplus funds: The Committee expressed concern about the depletion of the Authority’s surplus fund over the medium-term and requested an explanation. The Authority stated that the over-billing based on the previous fees structure created the depletion as credit notes had to be passed to refund companies. In order to mitigate against a deficit, projected expenditure in Programme 3: Communications, Registration and Training will be reduced, especially in the printing and advertising environments.

Unknown fees: The Committee asked whether the significant challenge regarding unknown fees being deposited into the PSIRA account, which lead to a qualified audit in 2013/14, was addressed and rectified. The Authority stated that it is unfortunately an area that will never be fully dealt away with, as it is the nature of the industry. However, the Authority stated that significant gains have been made and that the interventions, especially in terms of increased control mechanism, are yielding positive results. The Authority further stated that awareness campaigns were prioritised to educate the industry and led to significant reductions in the amount of unknown fees. Additionally, a control amount or material threshold is allowed by National Treasury (R800 000), and the Authority is well below the threshold amount.

Appointment of Chief Financial Officer (CFO): The Authority stated that the Council appointed another CFO on a six month contract and that the CFO will remain until a permanent CFO is appointed. The Authority stated that the post was advertised.

Programme 2: Law Enforcement

The Committee made the following observations during the 2015/16 budget hearings on Programme 2: Law Enforcement:

Inspection capacity: The Committee questioned whether the Authority has adequate inspector capacity to effectively regulate and conduct inspections on companies. The Authority stated that it wishes to have a specific ratio between inspectors and security provides (guards) for which the Authority needs an additional 100 inspectors. To mitigate against the insufficient capacity, the Authority stated that it employs targeted strategies to ensure delivery on its mandate. The Authority will employ fifteen additional investigators during the 2015/16 financial year. The Authority stated that it will capacitate a complaints office to address quality of service by security providers to assist with targeted compliance inspections.

Review of Law Enforcement Strategy: The Committee requested the Authority to expand on the performance target for the annual review of the Law Enforcement Strategy. The Authority stated that the annual review is necessary to ensure that non-compliant companies are compliant as new evasion strategies are continuously developed and the Authority must keep up with these strategies.

Sectors: The Committee welcomed the inclusion of performance indicators for sector specific compliance inspections and requested the Authority to elaborate on the determination of the sectors. The Authority stated that it received the most complaints from the retail, heath, educational, corporate and residential sectors and as such developed specific indicators to monitor compliance by these sectors. The Authority further stated that the targeted weights was based on the number of complaints and that the percentages of the targets for the five sectors adds to 100 per cent.

Firearms: The Committee requested an update regarding the integration of firearms used by the industry with the South African Police Service (SAPS) database (Central Firearms Registry/CFR). The Committee further asked the Authority whether the Firearms Compliance Committee has been established. The Authority stated that the formal agreement with the SAPS will be signed in May 2015, but that the working relationship established between the SAPS and the Authority is ongoing and effective. The Authority receives quarterly reports from the CFR on firearms registered in the industry. The Authority will receive an updated database within the current financial year. In terms of the Firearms Compliance Committee, the Authority stated that the Committee was established and is the reason for the target being removed from the APP. The establishment of the Committee led to the inclusion of the performance indicator for the number of security businesses licenced to possess firearms inspected.

Programme 3: Communications, Registration and Training

The Committee made the following observations during the 2015/16 budget hearings on Programme 3: Communications, Registration and Training:

Internal stakeholders: The Authority stated that regular engagements with internal stakeholders is key to the success of the Authority as stakeholders must understand the mandate of the Authority and regular communication from the Authority ensures that mixed messages are not being communication within the industry.

Strategic shift: The Committee raised concern about the shift of resources away from Programme 2: Law Enforcement, which is the core business to Programme 3: Communications, Registration and Training. The Authority stated that the two programmes were merged, but that it was separated in consultation with National Treasury. The Authority further stated law enforcement is not the sole mandate of the Authority and that communication to the industry, registration of service providers and training to service providers is an equally important mandate of the Authority.

Awareness campaigns: The Committee requested more details on where the awareness campaigns are run and more specifically what are the nature of these campaigns. The Authority stated that awareness campaigns are targeted to a specific section of the industry and that most campaigns are run in the Daily Sun and Sowetan newspapers. The Authority further stated that the SABC sponsored free airtime on several radio stations, which assists the Authority significantly.

Training and qualifications: The Committee stated that Outcome 9 calls for an increased compliance to minimum professional standards in the training of SSP’s and questioned whether this also related to longer training of SSPs. The Authority stated that engagements with the service providers are underway and the extension of training will be prioritised.

Annual Pan-African Forum: The Committee noted that the Authority plans to host an annual Pan-African Forum on the private security industry and questioned what funds would be used to host such a forum. The Authority stated that the forum will be hosted with funds from sponsorships.

RECOMMENDATIONS AND ADDITIONAL INFORMATION

This section provides a summary of the recommendation made by the Committee and also a summary of the additional information requested during the 2015/16 budget hearings.

Additional information

The Committee requested additional information through written responses to supplement the information gathered during hearings on the 2015/16 budget hearings of the PSIRA:

The Committee requested that the Authority should provide a timeframe for the completion of the governance framework review and also to submit a report on the findings once completed.
The Committee requested a comprehensive breakdown of the estimated revenue for the 2015/16 financial year.

Recommendations

The Committee made several recommendations to the Authority during the 2015/16 budget hearings. These included the following:

The Committee recommends that the review of the governance framework with the objective to align it to the King III Guidelines should be prioritised. In addition, the findings and outcomes of the review should be shared with the Committee upon completion.
The Committee recommends that the Authority must report on the complete economic classification of expected operating expenditure and revenue in their Annual Performance Plan in coming years.
The Committee recommends that the Authority must increase its focus on the capacitation of its core Programmes.
The Committee recommends that the extension of the corporate head office lease should not be extended any longer than necessary in order to mitigate against unnecessary expenditure.
The Committee recommends that the Authority should engage the National Treasury to expedite the conclusion of the feasibility study that was conducted on the Arcadia premises in order for the Authority to move forward in finding a permanent location for the corporate Head Office.
The Committee recommends that the complaints office should be capacitated as a matter of urgency.
The Committee recommends that the research done in partnerships with academic Institutions, like Wits University should be forwarded to the Committee upon completion.
The Committee recommends that the investigation into the concerns raised by the key cutters fraternity on the inability to afford the new annual fees should be expedited and the outcomes, as well as the solutions, be communicated to the Committee.
The Committee recommends that challenges on the implementation of the Private Security Levies Act, 2002 should be addressed. The Authority is encouraged to share the challenges with the Committee in order to find solutions.

CONCLUSION

The Portfolio Committee on Police noted improvement in the operations of the Authority and especially welcomed the inclusion of sector specific compliance indicators. The Committee further stated that improved stakeholder engagements and trust by the private security industry are crucial for the successful implementation of the Authority’s mandate. As such, the reinvigoration of the complaints office to address the quality of service by security providers is welcomed. In conclusion, the Committee indicated that it will continue to fulfil its Constitutional mandate which is guided by the Parliamentary rules in conducting the oversight on the functioning of state owned entities, including PSIRA, in order to ensure the proper and effective functioning and compliance with the legislative mandate and policy requirements of the Authority.

Report to be considered.

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