ATC161021: Budgetary Review and Recommendations Report of the Portfolio Committee on Defence and Military Veterans on the 2015/16 Annual Report Plan of The Department of Military Veterans (DMV), dated 21 October 2016

Defence and Military Veterans

BUDGETARY REVIEW AND RECOMMENDATIONS REPORT OF THE PORTFOLIO COMMITTEE ON DEFENCE AND MILITARY VETERANS ON THE 2015/16 ANNUAL REPORT PLAN OF THE DEPARTMENT OF MILITARY VETERANS (DMV), DATED 21 OCTOBER 2016.

The Portfolio Committee on Defence and Military Veterans, having considered the financial and service delivery performance of the Department of Military Veterans (DMV) for the 2015/16 financial year, reports as follows:

 

         1.         Introduction

 

1. Description of core functions of the Department

The Department of Military Veterans derives its mandate from the Military Veterans Act (No 18 of 2011), which requires it to provide national policy and standards for socio-economic support to military veterans and to their dependents, including benefits and entitlements to help realise a dignified, unified, empowered and self-sufficient military veterans community.

 

1.2        Mandate of Committee

The Portfolio Committee on Defence and Military Veterans (PCODMV) is mandated to oversee the Department of Military Veterans (DMV) to ensure that the Department fulfils its mandate through the monitoring of the implementation of legislation and adherence to policies, such as the Military Veterans Act and the Military Veterans Benefits Regulations and other related legislation. It must scrutinise legislation which supports the mission statement of Government; the budget and functioning of DMV.

 

1.3        Purpose of the BRR Report

Section 5 (2) of the Money Bills Procedures and Related Matters Amendment Act (No. 9 of 2009) allows for each Committee to compile a budgetary review and recommendation report (BRRR) which must be tabled in the National Assembly.  Section 5(3) provides for a budgetary review and recommendation report to contain the following:

 

• an assessment of the department’s service delivery performance given available  resources;
• an assessment on the effectiveness and efficiency of departments use and forward allocation of available resource; and
• recommendations on the forward use of resources

 

The above is done in October of each year, and the BRRR is also a source document for the Standing/Select Committees on Appropriations/Finance when they make recommendations to the Houses of Parliament on the Medium-Term Budget Policy Statement (MTBPS). The comprehensive review and analysis of the previous financial year’s performance, as well as performance to date, form part of this process.

 

1.4        Methodology in compiling the report

The Report is compiled from the various activities of the Committee. It is inclusive of the Committee’s meetings, oversight visits, reports on budget votes, strategic plans, annual performance plans and annual reports, as well as previously published Committee reports.

 

1.5        Dates of oversight visits

The PCODMV has conducted an oversight visit to:

 

• Gauteng over the period 21 to 24 July 2015 where it visited the Department of Military Veterans Headquarters on 24 July 2015.

 

1.6        Information used to compile the Report

Besides the information on the Oversight visits, other information used in the assessment of the service delivery and financial performance included the:

 

• Committee reports on the 2015/16 budget hearings, strategic plans and Annual Performance Plans reports;
• DMV Annual Report 2015/16;
• The National Development Plan;
• The 2015 Estimates of National Expenditure;
• The 2015 State of the Nation Address; and
• The Auditor-General Report on the DMV.

 

 

1.7        Structure of the Report

This report comprises seven sections:

• Section 1: Introduction – sets out the mandate of the Committee, the purpose of this report (BRRR) and the process to develop this report.

• Section 2: Provides an overview of the key relevant policy focus areas.
• Section 3: Provides an overview and summary of previous key financial and performance recommendations of Committee (2015/16).
• Section 4: Provides a broad overview and assessment of financial performance of the Department for 2015/16.
• Section 5: Voted Funds and Planned Expenditure for FY 2016/17
• Section 6: Key Committee findings. 
• Section 7: Key recommendations.

 

 

1. Overview of the key relevant policy focus areas

 

2.1        State of the Nation Address

The Theme of the 2015 SONA was 20 years of a democratic Parliament. This relates closely to the mandate of the DMV to enhance the quality of life of Military veterans. The President stated that “We continue to deliver houses to our people. Government will also provide 5 000 housing opportunities for military veterans.” He also mentioned the fight against corruption which continues to be taken forward by the Anti-Corruption Inter-Ministerial Committee.  Also applicable is the statement that “To prevent corruption and promote ethical governance, in December I signed into law the Public Administration and Management Act which amongst others prohibits public servants from doing business with the State."

2.2        National Development Plan (NDP)

The DMV contributed to the National Development Plan (NDP) through its various programmes for the financial year 2015/16. The relevant chapters include the following:

Chapter 3: Economy and Employment: Facilitating employment for military veterans contributes to the NDP. It states regarding the (MTSF) goals, that “450 MVs and their dependants were placed in administrative positions in the South Africa Social Security Agency (SASSA) throughout the country,” and that “Under the creation of employment, the Department itself employs at least 133 military veterans and their dependants, constituting 59% of the total Department staff component.”

Chapter 6: An integral and inclusive rural economy: Various benefits provided by the DMV such as education, skills development, health-care, and access to public transport contribute to the NDP. For 2015/16, 3 650 learners were provided with education support for the academic year 2015. 32 military veterans and their dependants graduated from tertiary education institutions. By the end of the year under review, 1 543 military veterans were assisted in accessing training and skills development programmes. As at 31 March 2016, a total of 8 264 military veterans were authorised to access healthcare services. During the year under review, 1 260 military veterans and their dependants received counselling services; and 56 Military Veterans had received compensation for injury in military services as at 31 March 2016.

Chapter 8: Transforming Human Settlements: The provision of houses for military veterans will contribute to the NDP. For 2015/16, 130 houses in partnership with the Department of Human Settlement (DHS) were built for military veterans. In addition, 16 mortgaged houses of military veterans were rescued by the Department from being repossessed by the banks.

Chapter 9: Improving Education, Training and Innovation: Details provided above also apply to this chapter of the NDP.

Chapter 10: Promoting Health: The provision of health care service as stated above contributes to the NDP.

 

2.3        Medium Term Strategic Framework (MTSF) 2014 - 2019

For 2015/16, the DMV contributed to the following MTSF outcomes:

Outcome 1: Improved-quality basic education. During the 2015 academic year 3 650 learners were provided with education support. As at the end of the year under review, a total of 5 482 were provided with education support. 32 military veterans and their dependants graduated from tertiary institutions.

Outcome 2: A long and healthy life for all South Africans. For 2015/165, a total of 14 666 military veterans have access to healthcare facilities. There was an increase of 8 264 (56%) as compared to 2014/15.

Outcome 4: Decent employment through inclusive economic growth. Military veterans were placed at Water and Sanitation in Standerton, Passenger Rail Agency of South Africa (PRASA) and the Department of Agriculture, Forestry and Fisheries (DAFF), and 450 Military Veterans and their dependants were placed in administrative positions in the South Africa Social Security Agency throughout the country. Within the Department itself, 59% of the total staff component is comprised of military veterans and their dependants. A total 1 700 military veterans accessed job opportunities.

Outcome 5: A skilled and capable workforce to support an inclusive growth path. During the period under review, 814 military veterans were provided with business advice support. In addition, 149 military veterans companies were registered on the Department SCM database and services are being procured from military veteran owned businesses.

Outcome 7: Vibrant, equitable, sustainable rural communities contributing towards food security for all. A total of 1 213 military veterans received Social Relief of Distress (SRD) through SASSA. The Department also intervened in and provided them with temporary shelter under the SRD programme.

Outcome 8: Sustainable human settlements and improved quality of household life.  The Department provided 173 families of deceased military veterans with burial support, 15 military veterans were exhumed and reburied with dignity, and 1 260 military veterans and their dependants received counselling services. As at 31 March 2016, 130 houses were built for military veterans. It also rescued 16 houses of military veterans in distressed that were at the risk of being repossessed by the banks during the current reporting period.

Outcome 12 - An efficient, effective and development-oriented public service and an empowered, fair and inclusive citizenship. These include support provided to South African National Military Veterans Association, the establishment of the Appeals Board on Military Veterans, and the Military Veterans Advisory Council. They also mention a Memorandum of Understanding (MoU) that resulted in the employment of 450 military veterans at SASSA, and its promotion of benefits and programmes through events management, social media and media relations.

Outcome 14 - Nation building and social cohesion. It celebrated the 30th commemorative anniversary of three liberation heroes who were killed by the security police in Piet Retief. It participated in the planning for the erection and unveiling of the memorial bust in honour of Dr Ruth Mompati. It also honoured military veterans such as Mac Maharaj; Ike Maphoto; and those involved in the Wankie Sipolilo’s campaign.

 

2.4        Strategic Priorities of Department

The Strategic Priorities of the DMV are closely linked to Government’s medium-term strategies. For 2014/15, the Executive Authority’s priorities included the following:

• Ensuring a fully functional Department of Military Veterans with an independent vote, systems and processes. As at 31st March 2016, the Department filled a total of 133 permanent posts from the 169 funded posts.

 

• Strengthening governance and oversight protocols to give effect to the provisions of the Act:  The Department lists the establishment of the Appeals Board and Advisory Council on Military Veterans, the Audit Committee which is a shared service with the Department of Defence (DOD) and the Turnaround Strategic Initiative (TSI), all of which are operational.

 

• The provision of immediate social services to relieve distress among the most vulnerable military veterans: A total of 1 213 military veterans received SRD through SASSA and intervened in 10 cases of destitute military veterans and provided them with temporary shelter under the SRD programme.

 

• Provision of comprehensive support services to military veterans and, where applicable, to their dependents, subject to availability of resources: These include issues related to Access to health support, Compensation, Education, training and skills development, Facilitation of employment placement, Facilitation of or advice on business opportunities, Burial support, Housing support, and will be addressed in the discussion on the Empowerment and Stakeholder Management programme.

 

• Promote empowerment programmes for and of Military Veterans: These include the Roadshows that were conducted in 5 provinces, the assistance of military veterans to register their companies on the Department Supply Chain Database, and the awarding of 8 farms to military veterans by Department of Rural Development and Land Reform (DRDLR). It also include the eleven MoUs that were concluded with both government departments and the private sector in order to benefit the military veterans and their dependants.

 

• Empowerment of Military Veterans to enhance their contribution to Reconciliation and Nation Building:  During the year under review, the Department assisted in the exhumation and reburial of the remains of 15 military veterans.

 

• Maintenance of a credible and secure national military veterans: This relate to process of finalising the electronic system which will be used to administer the registration of military veterans in the National Veterans Military database which is secured and reliable. As at 31 March 2016, 98% of the 71,811 military veterans registered on the database are bona fide Veterans with force numbers that are verifiable through the Department of Defence (DOD).

 

• Implementation of a high impact communication and marketing strategy and plan: This deals with the promotion of benefits and programmes through events management as well as social media and media relations.

 

2.5.       Overview of DOD Strategic Plan and Annual Performance Plan

The DMV 2015/6 Annual Performance Plan and the Strategic Plan (2015 - 2020) give effect to the mandate of the DMV which translates into the following outcomes:

 

• Administration

This programme is responsible for the provision of Strategic direction through six sub-programmes such as Management; Corporate Services; Financial Administration; Internal Audit; Strategic Planning, Policy Development and Monitoring and Evaluation; and Office accommodation.

 

• Socio-Economic Support (SES)

The provision of socio-economic support to both military veterans and their dependants, is still a mandate that deserves a greater effort by the Department. During the period under review, 130 houses in partnership with the Department of Human Settlement (DHS) were built for military veterans. In addition, 16 military veterans’ houses were rescued by Department from being repossessed by the banks. The total cumulative number of military veterans authorised to access healthcare services during the year under review, is 14 666. During the period under review with regards to the Counselling Benefit, 1 260 military veterans and their dependants received counselling services.

 

• Empowerment and Stakeholder Management (ESM)

1 543 military veterans and dependants were approved for funding for Skills Development and Training Programmes by the Department during the period under review. Under Business Development Support programme, the Department provided assistance to 269 military veterans and captured 32 cooperatives for registration with the Companies and Intellectual Property Commission (CIPC).

 

 

3.         Summary of previous recommendations of the Committee

 

3.1.       2015 BRRR Recommendations

In 2015, the Committee made the following recommendations in its BRR Report on performance of the DMV for the 2015/16 financial year.

 

3.1.1     Budgetary related recommendations:

• The Committee re-iterates that the implementation of the Military Veterans Act, particularly the maintenance of a reliable military veterans database; the fair application of a means-test; the efficient delivery of benefits and services to military veterans; are essential to ensure that military veterans’ quality of life is enhanced and that military veterans receive the necessary support and acknowledgement for their selfless service to society.

 

• The Committee urges the Department to take the necessary steps to address the limitations found on the asset register and to ensure that payments for goods and services are in accordance with the Modified Cash Standards (MCS).

 

• Sufficient and appropriate audit evidence proving that effective and appropriate disciplinary steps were taken against officials who made and permitted irregular and fruitless expenditure, is required. It is recommended that proper consequence management be implemented not only in such cases but also to prevent the recurrence of irregular expenditure, and fruitless and wasteful expenditure.

 

• The poor performance and management in the Department frustrate efforts to improve the military veterans’ quality of life. Critical interventions are required to ensure that resolution of all deficiencies that led to the disclaimer and qualification audit opinions in 2013/14 and 2014/15 financial year, the finalisation and implementation of service level agreements and memoranda of understanding with those stakeholders responsible for the provision of services and benefits to military veterans. 

 

• The Department should ensure that financial statements, performance and annual reports comply with national standards set, and should be monitored throughout the year to ensure that progress is made in this regard.

 

• The Committee has on a number of occasions urged the Department to ensure that all vacancies are filled with not only suitably qualified personnel, but also with individuals who are sufficiently committed and appropriately skilled to identify the needs of military veterans, and efficiently and effectively ensure good administration of the Department.  It is recommended that decisive steps be taken to ensure the strengthening of recruitment and appointment processes, and that a skills audit is conducted to identify the skills set and needs of existing personnel.

 

3.1.2     Response by Department and Minister of Finance:

The Minister of Finance’s response dated 17 May 2016 to the 2015 BRRR recommendations, refers only to the recommendations made on the Department of Defence.  

 

3.2.       Committee 2015/16 Budget Report

The Committee made the following recommendations in terms of the 2015 Annual Performance Plan, Strategic Plan (2015 - 2019) and the 2015/16 Budget of the Department of Military Veterans:

 

3.2.1     Recommendations on the Budget FY 2015/16:

• The Committee is concerned about the inconsistencies and inaccuracies in performance information contained in tabled reports. It therefore recommends that the Department liaise with National Treasury, the Department of Public Service and Administration, the Department of Performance, Monitoring and Evaluation as well as the Auditor-General, to ensure that these issues are addressed.

 

• The Department should report to the Committee on the progress and success of its action plans to address the disclaimer audit opinion during its quarterly interactions with the Committee.

 

• One of the challenges identified was the leadership component and as such the Department undertook to intervene to address this issue. The Department is therefore requested to report to the Committee on the roll–out and success of this intervention to ensure that this challenge is addressed. While it is encouraging that funds have been set aside for training and development, further information should be supplied on the type and duration of such training.

 

• The Department has been rated very low on the MPAT tool administered by the DPME and indicated that it is addressing this issue. The Department should therefore not only report on the progress, but also on plans to ensure that it does not relapse again in this regard.

 

• Costs associated with activities such as travel and subsistence communication and marketing, and entertainment versus the number of personnel in the Department, have drawn the attention of the Committee on several occasions. The Department is requested to specifically report on these issues to the Committee during its engagement on quarterly and annual reports.

 

• As the Department aims to have verified and captured 100% military veterans by the 2019/20 financial year, it is incumbent that it reports to the Committee on a regular basis on progress made in this regard. This is especially important since an incomplete database complicates planning and may even make the Department vulnerable to possible litigation.

 

• The Department must take care to ensure that senior managers complete the required financial disclosures and that decisive action is taken against individuals who fail to comply.

 

• With regards to the challenges faced by the Department to deliver services through other agencies, the Committee advises that a more vigorous compliance system should be developed to ensure that these stakeholders adhere to concluded agreements.

 

• The Department should report on the progress made in establishing provincial offices as well as how it interacts and liaises with provincial and municipal authorities to source appropriate offices to minimise costs in this regard.

 

         4.         Overview and assessment of financial performance

 

4.1.       Overview of Vote allocation and spending for 2015/16 FY

For 2015/16, the DMV received a final appropriation of R582 201 000. No shifting of funds were registered but an underspending of 40.1% (R233 592 000) against an 8.3% underspending in the previous financial year, is noted (see Table 1).

 

 

 

 

 

 

Table 1: Overview of Expenditure per Programme

Programme R’000	Adjusted Appropriation	Shifts	Final Appropriation	Actual Expenditure	Variance	% Spent
		(brackets FY2014/15 figures)
Administration	157 490	0 (19 541)	157 490 (158 637)	131 641 (143 574)	25 849	83.6%
Socio-Economic Support	266 305	0 (97 477	265 305 (265 550)	136 179 (255 171)	130 126	51.1%
Empowerment and Stakeholder Management	158 406	0 (77 936)	158 406 (79 973)	80 789 (64 318)	77 617	51.0%
Total	582 201	0(97 477)	582 201	348 609	233 592	59.9%

 

All programmes failed to spend their respective budgets with underspending in declining order as follows:

• Empowerment and Stakeholder Management with 49% (20% in FY 2013/14), thus an increase of 29% from the previous financial year.
• Socio-Economic Support at 48.9% (3.9% in FY 2013/14), an increase of 45% from the previous financial year; and
• Administration at 16.4% (9.8% in FY 2013/14) an increase of 6.6% from the previous financial year.

 

The three programmes of the DMV had a total of 20 set targets of which 10 were achieved leading to a success rate of 50 percent, as oppose to 56 percent in the previous financial year.

Total targets set:                                   20     

Targets achieved:                                  10/20    

Targets not achieved:                            10/25     

Success rate:                                        50%

Total Budget Spent (%):                        59.9%

 

4.1.1     Administration

Total targets set:                                   10     

Targets achieved:                                  5/10    

Targets not achieved:                            5/10    

Success rate:                                        50%

Total Budget Spent (%):                        83.58% (R131 641 000/R157 490 000)

Programme 1: Administration is the second “best” performing programme in that it has the success rate (50%) and spend around 83.6% of its budget. Four targets were not achieved. In terms of budget, this programme has spent R131 641 000 of the allocated R157 490 000. This means it recorded an underspending of R25 849 000 or 16.4 percent of the total allocated budget. Underspending was recorded for Management (R45 000), Financial Administration (R1 061 000), Internal Audit (R2 212 000), Strategic Planning, Policy Development, Monitoring and Evaluation (R12 051 000) and Office Accommodation (R10 662 000). Overspending was recorded in Corporate Services with R182 000.

 

4.1.2     Socio-Economic Support

Total targets set:                                   5     

Targets achieved:                                  3/5    

Targets not achieved:                            2/5     

Success rate:                                        60%

Total Budget Spent (%):                        51.1%

Programme 2: Socio-Economic Support achieved 3 of its 5 targets giving it a success rate of 60 percent. It however only spent 51.1 percent of its allocated budget. Programme 2 spent R136 179 000 of the allocated R266 305 000, which is an underspending of R130 126 000 or 48.9 percent of the total allocated budget (see Table 5). The underspending should be compared with the 60% performance.  In terms of sub-programmes, overspending was recorded for the Healthcare and well-being support to the amount of R28 569 000.  Underspending was present in the Database and Benefits Management sub-programme Socio-Economic Support Management with R451 000 and Socio-economic support with R158 244 000.

 

4.1.3     Empowerment and Stakeholder Management

Total targets set:                                   5     

Targets achieved:                                  2/5    

Targets not achieved:                            3/6     

Success rate:                                        40%

Total Budget Spent (%):                                    51%

Programme 3: Empowerment and Stakeholder Management had a total of 5 targets of which 2 have been achieved leading to a success rate of 40 percent. It spent 51% percent of its allocated budget, and 60 percent of its targets were underachieved. This programme has spent R80 789 000 of the allocated R158 406 000, thus recording an underspending of R77 617 000 or 49 percent of the total allocated budget.

4.2        Financial statements

 

The following should be noted:

• Unauthorised expenditure: The amount is indicated as R 232 797, while no unauthorised expenditure was incurred for the financial years 2013/14 and 2014/15.

 

• Irregular expenditure: In terms of irregular expenditure, the closing balance was R50.182 million, the irregular expenditure for 2015/16 is R 123 693 000 for 12 cases of noncompliance with procurement processes (R1 607 000); 13 cases of non-compliance with SCM processes (R13 561 000); Noncompliance with Department approved financial delegations to the amount of R106 489 000; Requirements of pay progressions not followed (R227 000); and Procurement processes were not followed (R 1 809 000)

 

• Fruitless and wasteful expenditure: This amount is R811 000 for the financial year as oppose to R1.572 million in the previous period. It relates to Expenditure incurred for bookings of S&T where military veterans did not show up (R361 000); Interest paid to overdue of account (R4 000); LOGIS system payment (R3 000), and Medical schemes payments made for beneficiaries that are not listed on the database (R443 000). More concerning is the amount of R853 000 that is under investigation and relates to possible fruitless and wasteful expenditure of dental fee invoice paid for military veterans under investigation.

 

• Contingent liabilities: The total for Liabilities was R235 027 000 against last year’s R5 891 000. It relates to Claims against the Department of R205 580 000 up from last year’s R5 706 000 and Intergovernmental payables of R29 447 000 up from last year’s R5 891  000.

 

4.3        Compensation of employees

The Annual Report indicates a vacancy rate of 22% by 31 March 2015 with 131 posts being filled and 61 employees to the establishment. The APP lists staff compliment of 169 with 60 additional employees as at 31 March 2016. The costs associated with personnel are indicated below.

Table 2: Comparative Compensation of employees

	2015/16	2016/17	2017/18	2018/19
Programme 1: Administration	R56.5m (102)	R59.6m (102)	R65.6m (102)	R71.2 m (102)
Programme 2: SES	R15.4m (21)	R16.2m (21)	R17 (21)	R18m (21)
Programme 3:ESM	R25.6m (46)	R27 (46)	R31.3m (46)	R33.1m (46)
DEPARTMENT	R97.5 m (169)	R102.7 (169)	R113.8m (169)	R122.3 m3 (169)

 

 

 

Table 3: Personnel figures- 2015/16 to 2018/19

Performance indicator
Percentage staffing of vacant funded posts		90 (152)	90 (152)	90 (152)	90 (152)

 

4.4        Report of the Auditor General (AG) FY 2015/16

 

4.4.1     Qualified Audit Opinion

The Department received a qualified audit opinion and the basis for this was informed by the following:

Movable tangible capital assets:

The Auditor-General (A-G) was unable to obtain sufficient appropriate audit evidence that the Department had properly accounted for all movable tangible capital assets due to limitations in the asset register. The A-G was unable to confirm movable tangible capital assets by alternative means.

4.4.2     Emphasis of matters:

These include:

• Restatement of corresponding figures: The corresponding figures for 31 March             2015 have been             restated as a result of errors discovered during the year ended 31           March 2016 in the financial         statements.
• Material underspending of the budget: Underspending is present on current payments   and       payments for capital expenditure for all three programmes to the amount of R233 592 000 up from R 41 525 00 in the previous financial year.

 

4.4.3     Significant uncertainty:

The Department is a defendant in a contract cancelation lawsuit. The ultimate outcome of the matter cannot presently be determined and no provision for any liability that may result has been made in the financial statements.

4.4.4     Predetermined Objectives:

The A-G performed procedures to obtain evidence about the usefulness and reliability of the reported performance information in the following programmes:

• Programme 2: Socio-Economic Support. A total of 20 percent of the targets in relation to Socio-Economic Support Services were not specific and measurable. A total of 20% of the indicators were not well defined.  In addition, adequate and reliable corroborating evidence could not be provided for the reported achievements against planned targets of 50% of indicators.

• Programme 3: Empowerment and Stakeholder Management. A total of 40 percent of the indicators were not well-defined and 60% of the targets were not measurable. In addition, adequate and reliable corroborating evidence could not be provided for the reported achievements against planned targets of 20% of indicators.

 

4.4.5     Compliance with legislation:

• Strategic planning and performance reporting:  Effective, efficient and transparent systems of risk management and internal control with respect to performance information and management were not maintained as required by the PFMA.
• Annual Financial statements: The financial statements submitted for auditing were not prepared in accordance with the prescribed financial reporting framework and supported by full and proper records as required by the Public Finance Management Act. Material misstatements of accruals, prepayments, lease commitments, irregular expenditure and transfer payments identified by the auditors in the submitted financial statements were subsequently corrected, but the lack of adequate supporting records for movable capital assets resulted in the financial statement receiving a qualified audit opinion.
• Procurement and contract management: Goods and services with a transaction value below R500 000 were procured without obtaining the required price quotations and Goods and services of a transaction value above R500 000 were procured without inviting competitive bids.  Contracts and quotations were awarded to suppliers whose tax matters had not been declared by the South African Revenue Services to be in order.
• Expenditure management: Effective internal controls were not in place for payment approval and processing, and money was spent without the approval of the accounting officer and/or a properly authorised official. Effective steps were not taken to prevent irregular expenditure. The value of R173 875 000 as disclosed in the financial statements is still being investigated by management to quantify the full extent of the irregular expenditure. Effective steps were not taken to prevent fruitless and wasteful expenditure, and the value of R811 000 is still being investigated by management to quantify the full extent of the fruitless and wasteful expenditure.

4.4.6     Internal control:

Several issues regarding internal control resulted in the basis for qualified audit opinion. The issues identified include the following:

• Leadership: The accounting officer did not exercise effective leadership and oversight responsibility regarding financial and performance reporting, compliance and related internal controls. Various material misstatements, limitations with regards to information supporting the annual financial statements, findings on the performance report and non-compliance with regulations were identified. Documented policies and procedures were not in place to guide financial and performance activities and prevent non-compliance with legislation. Key positions remained vacant over long periods, with the result that action plans developed to address prior year audit findings were not monitored and properly implemented.

• Financial and performance management: Management did not implement effective controls to ensure that information contained in the financial statements and performance report was reliable before submission for audit. This was mainly due to inadequate reviews and lack of proper record management systems. Management did not review and monitor compliance with regulations, resulting in numerous findings on compliance with legislation.

 

4.5        Risk management

The risks identified are similar to those of the previous two financial years and these remained for the FY2015/16. These impact on good governance and include the following:

• Administration: The risks include:
  • A lack of adequately skilled and dependable human capital,
  • Inadequate IT infrastructure and lack of internal IT capacity,
  • Lack of Department ownership of systems (dependency on DOD),
  • Lack of integration of systems (Persal, BAS and LOGIS),
  • Lack of security policies and procedures, and
  • Lack of contract/supplier management to adequately address supplier contracts.
• Administration, Socio-Economic Support and Empowerment and Stakeholder Management: These risks include the Fraud and corruption due to unethical conduct; Inadequate or weak internal controls; insufficient capacity to deal with management of fraud and corruption.
• Socio-Economic Support and Empowerment and Stakeholder Management: Dependency on service delivery agencies (other government departments for rolling out of service delivery benefits).

 

4.6        Fraud and corruption

 

• The Department’s fraud prevention plan and progress made in implementing the fraud prevention plan

The Department has an approved Fraud Prevention Policy and Plan respectively, which are updated on an annual basis. Due to capacity constraints, no formal awareness workshop was conducted during the financial year under review.

 

• Mechanisms in place to report fraud and corruption

The Department’s Fraud Prevention Plan that outlines Whistle Blowing procedures to be followed when reporting suspected fraud and corruption. Significant strides will be made to rollout the fraud prevention plan through posters at strategic areas within the Department; - Intranet and maintenance of the fraud and corruption risk registers.

 

• Procedures

The Department has procedures to manage:

• Confidential Whistle Blowing;
• Anonymous Whistle Blowing; and
• Handling of allegations.

 

4.7        Minimising conflicts of interest

 

The Department uses the following procedures for handling conflict of interest:

• The Department participate in the E-Financial Disclosure (E-FD) and timeously submits all required information about its business interest electronically to the Public Service Commission i.e. by 30 April of each financial year as legislated;
• Senior Management Service (SMS) are annually required to complete and submit the E-FD. SMS members in the Department who do not comply with the E-FD may be charged with misconduct according to regulations;
• All SCM members involved in the procurement process in the Department must be vetted and undergo a security vetting process;
• All Bid Committee members are obliged to sign conflict of interest forms to avoid any potential conflicts that may arise; and
• All SMS members currently disclose any conflict of interest electronically on an annual basis to the DPSA. This process is effectively managed by the departmental Human Resources Management.

 

4.8        Quarterly reports 2015/16

 

4.8.1     First Quarterly report

The Department of Military Veterans presented its 1st Quarterly Performance to the PCODMV on 19 August 2015.

 

Non-financial performance

Although 22 Annual Targets were set for the financial year, the Department committed to 18 performance targets over the quarter under review, with 4 performance indicators having no targets for the first quarter. It attained 72% overall performance in the 1st quarter.

Financial performance

As at 30 June 2015 the department spent 10% of its budget which constitute to R61 million with the variance of 14% (R84 million) in the first quarter of FY2015/16. The overall underspending of 14%, and especially Programme 2 and Programme 3 with an expenditure of 9% and 10% respectively is concerning. Accordingly, the Department should monitor the spending in these programmes since they are the main service delivery programmes

Observations

Against the background that there are challenges besetting the Department, especially the Disclaimer audit opinion in the previous financial year, it is imperative that the Department turn around its performance to effectively and competently deliver benefits to military veterans. It is unacceptable for instance that no progress has been made with providing subsidised public transport, and little progress with the delivery of houses and that there are challenges with the military veterans’ database. Given the budget allocated to the Department, the underspending needs to be addressed and systems should be in place to do this in a proper and effective manner.

4.8.2     Second Quarterly report

The Department of Military Veterans presented its 2nd Quarterly Performance to the PCODMV on 15 October 2015.

 

Non-financial performance

The APP indicates that 22 Annual Targets were set for the financial year, and the Department committed to 16 performance targets over the quarter under review, with 6 performance indicators having no targets for the first quarter. Of the 16 performance targets which the Department reported on, 10 targets were achieved, which constitute to 66% overall achievement of the targeted performance compared to the performance commitments set for the 2nd quarter. It indicates that the Department has regressed from an overall percentage of 72% in the first quarter to 66% in the second quarter.

 

Financial performance

As at 30 September 2015 the Department spent 23% of its budget which constitute R134 million with the variance of 27% (R291 million) in the second quarter of FY2015/16.

Observations

It is imperative that the Department turn around its performance to effectively and competently deliver benefits to military veterans. Given the budget allocated to the Department, the underspending needs to be addressed and systems should be in place to do this in a proper and effective manner. The payment of invoices within 30 days, the lack of staff in the Internal Audit, the little progress on cooperatives, as well as the employment of disabled people in the Department, should also receive attention. It is hoped that with the assistance of the Task Team assembled by Minister to turn around the Department, will soon be able to deliver on its mandate.

 

4.8.3     Third Quarterly report

 

The Department of Military Veterans presented its 3rd Quarterly Performance to the PCODMV on 9 March 2016.

 

 

Non-financial performance

The Quarterly Report indicates that the Department has set itself 19 targeted performance indicators indicates during the 205/16 financial year. Of the 19 performance targets which the Department reported on, 10 targets were achieved, which constitute to 53% overall achievement. It indicates that the Department has regressed from an overall percentage of 72% in the first quarter to 60% in the second quarter and 53% in the Third quarter.

 

Financial performance

As at 31 December 2015 the Department spent 75.3% (R438.652 million) of its adjusted budget (R582. 201 million) in the third quarter of FY2015/16.

 

Observations

The Department is beset by various challenges ranging from underspending, poor performance on its quarterly targets, an incomplete database which hampers planning, as well as personnel who are not performing optimally. With the appointment of the Turn-around Team, it was hoped that the Department will improve its performance to effectively and competently deliver benefits to military veterans. The Committee could not determine whether this is the case, hence the intention to invite the Turn-around Team to share its progress with the Committee.

 

4.8.3     Fourth Quarter report

While the audit opinion for FY 2015/16 is being awaited, the Department has submitted its Fourth Quarterly report which was presented to the Portfolio Committee on Defence and Military Veterans on 6 September 2016. Given that much of the information is taken up in the 2015/16 Annual Report as discussed above, this section is not further discussed.

 

 

5.         VOTED FUNDS AND PLANNED EXPENDITURE FOR FY 2016/17

 

5.1        Allocated Budget 2016/17

The Department is working towards obtaining its own separate budget vote to ensure that it is accounting for its own budget with its own accounting and budgeting systems. It has been allocated a budget of R597.6 million for the FY2016/17, an increase from the R582.2 million in the previous financial year. The biggest allocation is to Programme 2: Socio-Economic Support Services (SES) with R294.1 million followed by Programme 3: Empowerment and Stakeholder management (ESM) with R159.8 million followed by Programme 1: Administration with R143.7 m. This is in sync with the mandate of the Department, where Programmes 2 and 3 are the main service delivery programmes.

Table 4: Allocated Budget 2016/17

Programme	Budget		Nominal increase/ Decrease	Real increase/ decrease	% of budget (2016/17)
	2015/16	2016/17
Programme 1: Administration	157.5	143.7	-13.8	-22.7	24%
Programme 2: SES	266.3	294.1	28.8	9.6	49.2%
Programme 3: ESM	158.4	159.8	1.4	-8.5	26.7%
TOTAL	582.2	597.6	15.4	-21.6	100

 

The overall reduction in the Administration allocation vis-à-vis an increase in the Socio Economic Support Services programme may be viewed as a step in the right direction as it directs money towards service delivery oriented programmes. If executed correctly, this would align the budget with the primary mandate of the DMV and thus support the NDP and MTSF goals. However, in past financial years the ability of the DMV to spend its funds has severely undermined service delivery and this should be monitored throughout the 2016/17 financial year.

5.2        DMV selected performance indicators and targets

The DMV Selected Performance Indicators and Targets for FY2016/17 to FY2018/19 form the basis of the DMV contribution to the National Development Plan.

 

 

 

Table 5: selected performance indicators and targets

Indicator	2014/15	2015/16	2016/17	2017/18	2018/19
Total number of deserving military vets with access to health care services	6 795	13 923	14 500	15 000	16 000
Number of military vets with decent housing per year	0	1 000	1 000	1 000	1 000
Number of military vets memorial sites erected per year	2	4	2	2	3
Number of military vets with access to training and skills development per year	2 450	3 000	3 500	4 000	5 000
Number of private sector companies in partnership with DMV per year	15	25	60	60	60

 

5.3        Programme 1: Administration

In line with the overall real percentage reduction of the programme, the majority of sub-programmes received a real percentage reduction. The largest reduction is for Sub-programme 6 (Office Accommodation) which received a 31.4 per cent real reduction in its allocation. Sub-programme 5 (Strategic Planning, Policy Development, Monitoring and Evaluation) also received an 8.36 per cent real reduction.  The Internal Audit Capacity is the only capability to receive an increased allocation in this programme.

In terms of economic classifications, two major decreases should be noted. First, the allocation for Communication decreases from R12.6 million in 2015/16 to R5.2 million in 2016/17. Second, the allocation for Infrastructure and Planning Services decreases form R20.3 million in 2015/16 to R7.5 million in 2016/17. Finally, the allocation for contractors increases from R1.5 million in 2015/16 to R6.4 million in 2016/17.

 

 

 

 

Table 6: Nominal and real increases/decreases in the Administration Programme

Programme	Budget		Nominal Increase / Decrease in 2016/17	Real Increase / Decrease in 2016/17
R million	2015/16	2016/17
Sub-programme 1: Management	8.1	8.4	0.3	-  0.2
Sub-programme 2: Corporate Services	56.9	51.7	-  5.2	-  8.4
Sub-programme 3: Financial Administration	17.4	18.2	0.8	-  0.3
Sub-programme 4: Internal audit	14.7	16.1	1.4	0.4
Sub-programme 5: Strategic Planning, Policy Development, Monitoring and Evaluation	21.6	21.1	-  0.5	-  1.8
Sub-programme 6: Office Accommodation	38.7	28.3	-  10.4	-  12.2
TOTAL	157.5	143.7	-  13.8	-  22.7

 

Performance Indicators for Programme 1: Administration

Programme 1 includes 12 set targets for 2016/17. The majority of these refer to the routine submission of required documents such as APP’s and Strategic Plans. The target for the payment of ‘legitimate’ invoices is set at 90 per cent.

Table 7: Selected performance targets for Programme 1

Performance Indicator	Audited Outcome	Estimated Performance	Estimated Performance
	2014/15	2015/16	2016/17
Percentage of Communication Strategy activities implemented	New target	50%	75%
Percentage cases from the Presidential Hotline resolved	New target	100%	100%
Percentage of staff attending training initiative	New target	100%	100%
Percentage of signed performance agreements submitted to HRM	100%	100%	100%
Percentage staffing of vacant funded posts	80%	90%	90%
Percentage of legitimate invoices paid in 30 days	New target	New target	90%

 

5.4        Programme 2: Socio-Economic Support Services (SES)         

Programme 2 received a real percentage increase in its allocation of 3.6 per cent. This should be lauded as the programme related to the core business of the DMV, namely delivering services to veterans. The overall increase is largely attributed to the 37.93 per cent real increase in the allocation to Health Care and Wellbeing Support. Of concern, however, is the 12.45 per cent real decrease in the allocation to the Database and Benefits Management, which Members of the PCDMV have previously identified as an area of concern for the DMV.

In terms of economic classifications, the allocations remained relatively stable. There is an increase in the allocation for Contractors from R17.3 million in 2015/16 to R24.5 million in 2016/17. The allocation for Travel and Subsistence decreases from R6.2 million to R2.6 million over the same period.

Programme	Budget		Nominal Increase / Decrease in 2016/17	Real Increase / Decrease in 2016/17
R million	2015/16	2016/17
Sub-programme 1: Database and Benefits Management	12.0	11.2	-  0.8	-  1.5
Sub-programme 2: Health Care and Wellbeing Support	38.7	56.9	18.2	14.7
Sub-programme 3: Socio economic Support Management	215.6	226.0	10.4	-  3.6
TOTAL	266.3	294.1	27.8	9.6

Table 8: Programme 2: Socio-Economic Support Services

 

Performance Indicators for Programme 2 (Socio Economic Support Services)

Programme 2 has five strategic objective annual targets and five annual performance targets. Selected targets which are key to service delivery to military veterans are reflected in the table below. Of specific concern is the targets related to housing and the finalisation of the database, as past performances in this regard has been significantly lower than the set targets.

Table 9: Selected strategic and performance targets for Programme 2

Performance Indicator	Audited Outcome	Estimated Performance	Estimated Performance
	2014/15	2015/16	2016/17
A secured military veterans database	31%	80%	85%
Days taken to register veterans on the database	-	-	60 days
Number of military veterans with access to healthcare	6 795	13 923	14 500
Number of military veterans with access to decent housing	0	1 000	1 000
Number of bursaries provided to veterans and their dependents	645	3 650	4 000
Number of military veterans provided with counselling	New target	New target	1 500

 

5.5        Programme 3: Empowerment and Stakeholder management (ESM)

In line with the general real percentage reduction in the allocation to the DMV, all sub-programmes of Programme 3 received a real percentage reduction. The largest reduction is for the empowerment and skills development capability (6.0 per cent). In terms of economic classifications, the allocations remained stable between the 2015/16 and 2016/17, with little noticeable variations. Both Stationary as well as Machinery and Equipment received slightly lower allocations. This can most likely be attributed to the fact that the programme is by now well established and is in less need for Machinery and Equipment.

Table 10: Nominal and real increases/decreases in ESM Programme

Programme	Budget		Nominal Increase / Decrease in 2016/17	Real Increase / Decrease in 2016/17
R million	2015/16	2016/17
Sub-programme 1: Provincial offices and stakeholder relations	43.3	44.2	0.9	-  1.8
Sub-programme 2: Empowerment and skills development	100.5	100.7	0.2	-  6.0
Sub-programme 3: Heritage, Memorials, Burials and Honours	14.6	14.9	0.3	-  0.6
TOTAL	158.4	159.8	1.4	-  8.5

 

Performance Indicators for Programme 3: ESM

Programme 2 has five strategic objective annual targets and five annual performance targets. In line with the Accounting Officer’s priorities, the DMV looks to support 100 veteran’s businesses in 2016/17. Furthermore, the target for burial support will be a welcome addition to the list of targets as it is a factor that affects hundreds of families of veterans around South Africa.

Table 11: Selected strategic and performance targets for Programme 3

Performance Indicator	Audited Outcome	Estimated Performance	Estimated Performance
	2014/15	2015/16	2016/17
Number of private sector companies and organs of state in partnership with the DMV	107	25	60
Number of veterans with access to training and skills development	2 450	3 000	3 000
Number of veteran’s business entities supported per year	New target	40	100
Number of international engagements per year	1	25	30
Number of veteran’s families supported with burial support per year	New target	New target	200
Number of memorial sites erected per year	0	4	2

 

5.6        Personnel information and salaries

Similar to 2015/16, personnel figures are set to remain at 169 for 2016/17. The total cost associated with employees rises from R97.5 million in 2015/16 to R102.7 million in 2016/17. Personnel figures are expected to remain stable over the MTEF period. It should be noted, however, that a number of additional personnel are working at the DMV which are seconded from the Department of Defence. The additional personnel numbers are as follows:

• Programme 1: 39
• Programme 2: 19
• Programme 3: 3

 

Furthermore, Programme 1 has a vacancy rate of 22 per cent while Programme 3 has a vacancy rate of 33 per cent. This is of concern as it may hamper service-delivery. Finally, during a recent engagement between the DMV and the Standing Committee on Public Accounts (SCOPA), it was made clear that there is a significant capacity shortage in terms of the DMV’s Internal Audit capability. This was, in part, as a result of personnel limitations

 

5.7        Expenditure - Looking forward (1st quarter of the 2016/17 FY)

The Department of Military Veterans (DMV) received a total allocation of R597.6 million for 2016/17 to be spent over its three programmes. The DMV has had significant problems in spending its allocated budget and achieving some of its performance targets in the past. Tracking Quarterly Expenditure is thus essential to ensure delivery on the DMV mandate.

 

The briefing to the Committee on 7 September 2016 indicated that at the end of the first quarter, DMV spending was lower than projected with 15.26 per cent of the total allocation spent against a projection of 22.62 per cent. Spending was particularly low in the Socio-Economic Support and Empowerment and Stakeholder Management Programmes which relates to the primary service-delivery programmes of the DMV.

 

Slow spending on key performance areas

 

• Only 5 percent spent on Health care Support
• Only 5 percent spent on Housing
• Only 11 percent spent on Social Relief of Distress
• Only 4 percent spent on Skills Development

 

Areas of high spending

 

• •Payment to Capital Assets for Quarter 1 (R1.54 million) was higher than projected (R1.425million).
• •Spending on Education Support has already reached 91 percent of the total allocation by the end of the First Quarter.

 

Areas of concern: Programme 1 (Administration)

 

• One unsettled case from the Presidential Hotline remains, yet the target is marked 'achieved'.
• The signing of Performance Agreements is a recurring concern and should be addressed urgently.
• The percentage of invoices paid in 30 days are low and needs to be addressed.

 

Areas of concern: Programme 2 (Socio-Economic Support)

 

• In line with slow spending trends, housing and counselling support targets were not achieved.

 

Areas of concern: Programme 3 (Empowerment and Stakeholder Management)

 

• No agreements were signed with private companies/organs of state.
• No continental/international agreements signed by the DMV during Quarter 1.

 

         5.8        Oversight visit reports: summary of key service delivery issues.

The Committee did a walk-about in the Department of Military Veterans’ Headquarters in Hatfield on 24 July 2015 and engaged with various staff members. Challenges discussed related to those in especially the Service delivery programmes such as:

 

• The slow progress to deliver houses to deserving military veterans.
• Allocation of bursaries and coordination with schools and institutions of higher learning.
• No progress with the benefit related to subsidised public transport.
• Assistance to facilitate employment for military veterans.
• Communication and marketing strategies and the effectiveness thereof.
• Filling of vacancies as it impact on service delivery.
• The slow progress with skills development

 

6.         COMMITTEE OBSERVATIONS: DePARTMENT OF military VETERANS

 

Appreciation

• The Department was commended on the strides they have made to improve the performance, especially as it relates to certain benefits such as the progress made with bursaries; health benefits; the 450 military veterans employed at SASSA; the 56 veterans receiving compensation for injury in military services; the 1 700 military veterans who accessed job opportunities; and the exhumation and reburial of the remains of 15 military veterans. 
• The Committee also commended the Department on the 8 farms awarded to military veterans; the 32 military veterans and dependants who graduated from tertiary institutions; the progress being made by the Turnaround Strategic Initiative (TSI), and the appointment of an Acting D-G to address the instability at the top of the Department.
• The Committee was impressed by the actions of the Department to facilitate 1 213 military veterans to receive Social Relief of Distress (SRD) through SASSA and the intervention to provide temporary shelter under the SRD programme.
• The Committee commended the Department on its SRD interventions and the compassion it has shown to alleviate the plight of these military veterans. It was further encouraged to continue with such actions to speedily address the situation of those military veterans in dire straits.

 

Financial Performance

• The lack of consequence management and the reporting thereof was raised as a concern by the Committee, especially regarding issues such fruitless and wasteful expenditure (R811 000).
• Particular concern was expressed on the amount of Irregular Expenditure of R173 million, which is nearly a third of the total budget of the DMV of R582 million and considering the 40% underspending of R234 million which was recorded.
• The Auditor-General raised concern around the Supply Chain Management and Procurement processes and the Department admitted that it has recurring challenges in this regard.
• Concerns were raised on funds being “parked” at for instance NSFAS (R112 million) and the Department of Human Settlement (DHS), and the reasons therefore as well as plans with it.
• The Contingency liability of R235 million and especially the claims against the Department to the amount of R205 million, is concerning to the Committee.
• Performance rewards have been paid to 93 of the 133 employees to the amount of R1.5 million with no one in the leadership position receiving any reward. Given the poor performance and underspending, the Committee was concerned about these rewards.

 

Non-financial Performance

• The Committee was concerned that many of the issues are of a recurring nature and that it has previously recommended to the Department to address these issues, but little progress has been made to address these issues.
• It was noted that there was no report back on progress made to address the poor MPAT scores the Department has received, while in previous years this has been done. Although over-optimistic, the Department planned to achieve the highest level namely level 4, while the DOD was aiming for 2.5.
• The issue of “incompetent staff” was raised against the background that 109 of the 133 staff members underwent training but no skills audit was conducted beforehand. It was indicated that the Department has started with the skills audit last year but met with challenges and the TSI has identified staff to assist with it and progress is being made.
• The Committee noted that nearly all the funds for the Provincial offices has been spent and that not all provincial offices are up and running. This is mainly a challenge in rural provinces where military veterans need access to the benefits. 
• The Committee enquired about the DMV’s relationship with SITA as the latter has indicated at a meeting with the Committee that the relationship is not conducive to optimal functioning.
• Concern was expressed on the 59% of staff at the DMV being military veterans, and it was indicated that competent military veterans should not be hindered from joining the Department, but on the other hand those not adhering to requirements, should not be enlisted. Appointing people not suitable for positions hinders service delivery to the military veterans which they direly require. 
• The differing totals of staff employed by the DMV was also raised as a concern, as it differed from 169 to 227 to 280.
• The database’s 98% verification came as a surprise as it was 37% for the previous year and no such progress has been reported in the quarterly reports. This against the background that training could not be properly rolled because of the inaccuracies in the database and that military veterans’ pension could not be rolled out as the accuracy of the database was under review.
• The Committee noted the differing figures on the number of SLA’s and MOU’s such as 10, 11 and then 107, although it was indicated that first two are for in-years and the 107 is a cumulative figure.
• The Committee raised concern around internships and the eventual utilisation of these interns as well as the contract workers who are often doing the work of permanent people. The Department has a vacancy rate of 21% and most of posts are in the service delivery programmes which complicates the achievement of targets and necessitates the restructuring of the Department. In addition, the fact that most posts will be filled at provincial level, might be to the detriment of filling critical posts at the headquarters.
• The Committee noted that while the Annual Report shows no disciplinary cases, there were four cases of misconduct, which do not add up and should be explained.
• The slow delivery of houses (130/3000) and no progress on subsidised transport was raised as a serious concern, but note was take on the intention to utilise alternative delivery models to deliver houses.
• Concern was expressed at the functioning of the Call center, especially since some Members have experience of the challenges military veterans have to contact/access the Department as well as the numbers on the contact lists of the various directorates and sections in the Department. 
• The Department was informed of the challenges being experienced to access Burial support where a waiting period of up to a year has been experienced, which contradicts the intention to treat military veterans with dignity, in particular their burial.
• The Administration programme, and especially the sub-programme dealing with Strategic Planning, Policy Development and Monitoring and Evaluation underspent by 57% which is concerning given the tasks of this sub-programme and the challenges facing the Department.

 

7.         COMMITTEE Recommendations

 

• The Committee encouraged the Department to enhance its efforts to address the underspending and underperformance through the TSI and the Acting D-G to improve the lives of military veterans.
• The Department is not putting its weight behind the objective of being independent. The Department was urged to ensure that all systems are in place to ensure that it is able to exist independently from the Department of Defence.
• The Department should submit a report on progress regarding the MPAT at the next meeting, preferably when it reports on the performance of the Second Quarter for FY 2016/17.
• A Skills Audit is essential to properly plan training and the Department was requested to present a report on this at the next meeting, especially as the vacancies and skills gaps in the service delivery programmes are detracting it from functioning optimally.
• Only 72 percent of Performance Agreements were signed. The Department was urged to ensure that 100 percent is reached. 
• The Department should report back at the next meeting on the progress made with provincial offices as these are crucial to reach out to military veterans all over the country. It should similarly ensure that these offices are properly staffed to facilitate access to the Department and the various benefits as seamlessly as possible.
• The Department should give feedback on efforts to improve the relationship with SITA, inter alia the instruction that IT-related equipment should be procured through it, as well the status of their monthly meetings to improve their relationship.
• The Department indicated that they are following the normal recruitment processes especially regarding the appointment of military veterans. The Committee encouraged it to ensure that these processes are strengthened and that the “best person” for the job should be employed.
• The Committee recommended that the Consequence Management regime of the DMV be strengthened and that it should report at the next meeting on the cases and steps taken against persons who were found to be responsible for instances of Irregular and wasteful expenditure and other serious transgressions.
• The Department was requested to report back on progress to overhaul the SCM and Procurement processes in the Department in total with the assistance of National Treasury and the DPSA. It is especially the training intervention that is welcomed and the Department should report on progress in this regard on a regular basis.
• The Committee was informed that some of the funds “parked” at NSFAS, has since been utilised for the current academic year and it was encouraged to ensure that these funds were properly accounted for and utilised.
• The Committee wants clarity on the exact number of the people employed at the DMV and these statistics should be inclusive of contacts workers, interns etc and it should report back at the next meeting.
• The Committee recommended that the Department should prioritise the Database through enhancing its verification processes with military veteran organisations such as SANMVA and the assistance of the TSI to make progress on this issue. This is crucial since some of the benefit roll-outs seem to rely on an accurate database, and also because an inaccurate database can open the Department to possible litigation.
• The Department was told to ensure that its reports on SLA’s and MOU’s need to be as complete as possible, thus listing both the in-year numbers as well as the cumulative number of the SLA’s and MOU’s, when it reports to the Committee.
• The Committee encouraged the Department to ensure that interns and contract workers are being treated fairly in particular when they are performing very well in especially service delivery programmes that are struggling to perform.
• The Department should at its next meeting with the Committee report on its disciplinary cases i.e. the numbers, offences, outcomes etc.
• The Department was requested to report to the Committee on its new structure as soon as it has been approved by the Executive Authority.
• The Committee wants the Department to report on a quarterly basis on progress with housing and the transport benefit, in which the Department performed poorly in previous years. 
• The Call center challenges should be prioritised, especially since the Department has indicated that some of the functions will migrate from SITA to DMV. It should report to the Committee on this, with a view a joint meeting with both parties to assist addressing these issues.
• The Committee recommended that the DMV looks into the challenges around the pay-out of Burial support funds as a matter of urgency to ensure that the last respects are paid to military veterans in a dignified manner.
• The Department was encouraged to improve the performance of the Strategic Planning, Policy Development and Monitoring and Evaluation sub-programme through proper and speedy staffing a well as Management playing a bigger role to take responsibility of their respective policies.
• The Committee recommended that the Department should report back on the outstanding issues at the next meeting and especially progress regarding the recurring issues to allow the Committee to track progress in this regard.

 

Report to be considered.