ATC170523: Report of the Portfolio Committee on Defence and Military Veterans on Budget Vote 19: Defence and Military Veterans Entities: Department of Military Veterans, dated 23 May 2017

Defence and Military Veterans

REPORT OF THE PORTFOLIO COMMITTEE ON DEFENCE AND MILITARY VETERANS ON BUDGET VOTE 19: DEFENCE AND MILITARY VETERANS ENTITIES: DEPARTMENT OF MILITARY VETERANS, DATED 23 MAY 2017

The Portfolio Committee on Defence and Military Veterans (PCODMV), having considered the 2017/18 Budgetary allocation and Annual Performance Plans of the Department of Military Veterans (DMV), reports as follows:

 

         1.         Introduction

 

1. Mandate of the Department of Military Veterans

 

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

 

1. Main Objective of the Department of Military Veterans

 

The main objective of the Department of Military Veterans is to provide national policy and standards on socio-economic support to military veterans and their dependants, as well as policies and standards on heritage and empowerment programmes including those that contribute to nation-building and reconciliation.

 

2.         DMV CONTRIBUTION TO NATIONAL DEVELOPMENT PLAN

 

2.1        Chapter 3: Economy and Employment

 

In 2016, the Department listed the various contributions to the NDP and indicated the achievements such as 1 700 having accessed job opportunities, etc. For 2016/2017, the achievements will be released with the annual report later in the year.

 

2.2        Chapter 8: Transforming Human settlement

 

Through partnerships with Department of Human Settlement (DHS), the DMV will facilitate building of around 1 000 houses. Furthermore, the Department has planned to refurbish houses that are in need of renovations and also support military veterans whose houses are in the process of being repossessed by financial institutions.

 

2.3        Chapter 9: Improving Education, Training and innovation

 

The DMV facilitates self-reliance and contribution to nation-building by military veterans through conducting Recognition of prior learning interventions; and providing education support to 5 482 (3 650 in 2016/17) to military veterans and their dependents, according to its 2017 APP.

 

 

2.4        Chapter 15: Transformative society and uniting the country

 

Military veterans from statutory forces and those from former liberation forces rendered military services without remuneration and as such, were unable therefore to plan for their retirement, hence the Department through its mandate is obliged to service them.

 

2.5        Chapter 10: Promoting Health

 

Since entering into agreement with the South African Military Health Services, the DMV had managed to cumulatively since the 2013/14 financial year, deliver health and wellness service to 15 740 military veterans as at the end of the Fourth Quarter of the FY 2016/17.

 

2.6        Chapter 11: Social Protection

 

All legislated Socio-Economic Support Services for military veterans seek to ensure social protection for members and their families.

 

2.7        Chapter 13: Building a Capable State

 

The Department is working towards being an employer for both military veterans and their dependants by ensuring that recruitment is based on experience and expertise that will ensure efficient delivery on the Department’s mandate.

 

2.8        Chapter 14: Promoting Accountability and Fighting Corruption

 

The approved Department anti-fraud policy will assist in fighting corruption and promoting accountability. The Department will endeavour to implement the requisite disclosures and declaration of interests required by relevant legislation. The Department will ensure that all procurement processes rendered are transparent and are in line with Government legislation.

 

2.9        Chapter 15: Transformative society and uniting the country

 

Military veterans from statutory forces and those from former liberation forces rendered military services without remuneration and as such, were unable therefore to plan for their retirement, hence the Department through its mandate is obliged to service them.

 

3.         Management Performance Assessment Tool (MPAT)

 

The APP acknowledges challenges with improving the DMV MPAT scores since, particularly regarding KPA 2 (Governance and Accountability) and KPA 3 (Human Resource Management and KPA 4 Financial Management). For FY 2017/18, it will attempt to improve its performance with the assistance of the Department of Planning, Monitoring and Evaluation (DPME), on what practices are considered to be the best. “During the 2017/18 financial year, the Department will ensure that areas highlighted above are addressed through an improvement plan which will guide managers on poor performance areas.” Further, the Department will continually utilise MPAT as a tool that provides visibility on the weak areas in terms of management practices and governance and it has targeted itself to give a performance of level 3 (three).

 

4.         THE MEDIUM TERM STRATEGIC FRAMEWORK (2014 - 2019)

 

Eight Outcomes are listed to which the Department believes it can contribute as follow:

 

• Outcome 1: Improved quality basic education

 

The Department in embracing the ratification of international convention on social and cultural rights, a determination has been made to ensure that universal access to education, is accrued to all military veterans and where appropriate, their dependants.

 

• Outcome 2: A long and healthy life for all South Africans

 

The provision of healthcare services to the most vulnerable military veterans will continue. To strengthen easy access to healthcare, military veterans help desks were set up at the SAMHS healthcare facilities across all provinces in line with the Ministerial directive of April 2012. This is a positive development with regard to the rolling out of health care services. 

 

• Outcome 4: Decent employment through inclusive economic growth

 

It is imperative for the Department to promote empowerment programmes for and of military veterans and their dependants and this will be characterised by initiatives that embrace widening of access to economic participation.

 

• Outcome 5: A skilled and capable workforce to support an inclusive growth path

 

For 2017/18, the DMV will undertake an exploratory study to provide a skills profile of the military veterans that will inform the country’s skills base. This will assist in developing, confirming and deepening the skills base of military veterans and their dependents.  

 

• Outcome 7: Vibrant, equitable, sustainable rural communities contributing towards food security for all

The Department will enhance this Outcome by the provision of immediate Social Relief of Distress (SRD) to the most vulnerable of the military veterans and their dependants as mandated by the legislation.

 

• Outcome 8: Sustainable human settlements and improved quality of household life

 

It is a prerogative right for the Department to provide adequate housing and improved quality living environments for the military veterans and their dependants.

 

• Outcome 12: An efficient, effective and development-oriented public service and an empowered, fair and inclusive citizenship

Although the budget is still located in Vote 19, Defence and Military Veterans’ Programme 1: Administration under sub-programme Military Veterans Management, the DMV will ensure a fully functional and an independent vote, systems and processes as articulated by the Executive Authority.

 

• Outcome 14: Nation building and social cohesion

 

The empowerment of military veterans and their dependants in enhancing their contribution to reconciliation and nation building, will be characterised by promotion of Military Veterans’ heritage as well as memorialisation and honouring.

 

5.         MINISTERIAL PRIORITIES

 

The DMV shall endeavour to align its programmatic outputs and outcomes to these of the Ministry:

 

• Education Support: The number of military veterans and their dependents supported to study will increase. The DMV has adopted new Education Support policy to be rolled out in 2017/18.
• Housing: The DMV is working with the Department of Human Settlements to accelerate the delivery of houses to military veterans. 
• Social Relief of Distress: The DMV will intensify efforts to deliver the social relief of distress grants building up from the previous financial year.
• Heritage:  A number of celebrations as part of honouring and memorialisation will be held. These include the 30th Anniversary of the Battle of Cuito Cuanavale, amongst others.
• Health Care: The number of military veterans receiving heath care has increased. For 2017/18 the focus will be on imposing the level of medical care provided to military veterans.   

 

6.         DMV OVERVIEW OF THE BUDGET AND PERFORMANCE INDICATORS

 

The DMV Annual Performance Plan give effect to its mandate which translates into the following outcomes:

 

Programme 1(Administration): The main purpose of the programme is to provide management and strategic administration support to the Ministry, and overall management of the department. The Administration programme is divided into six sub-programmes; Management; Corporate Services; Internal Audit; Strategic Planning, Policy Development, Monitoring and Evaluation; and Office Accommodation.

 

Programme 2 (Socio-Economic Support):  The main purpose of the programme is to develop and monitor the implementation of legislation, policy frameworks and service delivery cooperation agreements on compensation for injury in military service, counselling, education, healthcare, public transport, pension and housing benefits to Military veterans eligible for such support. The programme consists of three sub-programmes, namely: Database and Benefits Management; Healthcare and Well-being Support; and Socio-Economic Support Management.

 

Programme 3 (Empowerment and Stakeholder Management): The main purpose of this programme is to manage and facilitate the implementation of military veteran empowerment and stakeholder management programmes. The programme consists of three sub-programmes, namely: Provincial Offices and Stakeholder Relations; Empowerment and Skills Development; and Heritage, Memorials, Burials and Honours.

 

 

 

6.1        DMV Expenditure Estimates for FY2017/18 to FY2019/20

 

The Department of Military Veterans received a total allocation of R622.1 million for the 2017/18 financial year, increasing from R597.6 million in 2016/17. While this reflects a nominal increase of R24.4 million in allocation, when adjusted for inflation it equates to a real percentage decrease of 2.07 per cent. The largest real percentage decrease is for the Empowerment and Stakeholder Management (2.92 per cent), followed by Administration (1.93 per cent) and Socio Economic Support (1.67 per cent).

 

Table 1: Expenditure Estimates for FY2017/18 to FY2019/20

Programme	Budget				Nominal Rand change	Real Rand change	Nominal % change	Real % change
R million	2016/17	2017/18	2018/19	2019/20	2016/17-2017/18		2016/17-2017/18
Programme 1: Administration	143,7	149,8	162,4	173,1	6,1	-  2,8	4,24 per cent	-1,93 per cent
Programme 2:Socio-Economic Support	294,1	307,4	324,4	342,8	13,3	-  4,9	4,52 per cent	-1,67 per cent
Programme 3: Empowerment and Stakeholder Management	159,8	164,9	173,3	183,6	5,1	-  4,7	3,19 per cent	-2,92 per cent
TOTAL	597,6	622,1	660,1	699,5	24,5	-  12,4	4,10 per cent	-2,07 per cent

 

6.2        Programme 1: Administration

Although the programme received a nominal increase of R6.1 million, in real terms, this amounts to a reduction of R2.1 million, which indicates a real percentage decrease of 1.94 per cent compared to 2016/17. Except for Corporate Services and Financial Management with real percentage increases of 20.82 per cent and 7.51 percent respectively, all other subprogrammes received decreased allocations in real percentage. The largest reduction is for Sub-programme 4 (Internal Audit) which received a 36.89 per cent real decrease in its allocation. Sub-programme 5 (Strategic Planning, Policy Development, Monitoring and Evaluation) also received a 25.99 per cent real decrease.  Sub-programme 6 (Office Accommodation) and Sub-programme 1 (Management) received 1.45 per cent and 11.91 per cent real reductions respectively.

Table 2: Nominal and real increases/decreases in the Administration Programme

Programme   R million	Budget		Nominal Increase / Decrease in 2017/18	Real Increase / Decrease in 2017/18	Nominal Percent change in 2017/18	Real Percent change in 2017/18
	2016/17	2017/18
Sub-programme 1: Management	8,4	8,8	0,4	-  0,1	4,76 per cent	-1,45 per cent
Sub-programme 2: Corporate Services	51,7	66,4	14,7	10,8	28,43 per cent	20,82 per cent
Sub-programme 3: Financial Administration	18,2	20,8	2,6	1,4	14,29 per cent	7,51 per cent
Sub-programme 4: Internal Audit	16,1	10,8	-  5,3	-  5,9	-32,92 per cent	-36,89 per cent
Sub-programme 5: Strategic Planning, Policy Development and Monitoring and Evaluation	21,1	16,6	-  4,5	-  5,5	-21,33 per cent	-25,99 per cent
Sub-programme 6: Office Accommodation	28,3	26,5	-  1,8	-  3,4	-6,36 per cent	-11,91 per cent
TOTAL	143,8	149,9	6,1	-  2,8	4,2 per cent	-1,94 per cent

 

In terms of performance indicators, Programme 1 includes 9 set targets for 2017/18, which is a reduction as compared to 12 set targets for 2016/17. More importantly, 6 of these targets are new. A total of 9 targets from 2016/17 no longer appear in the APP. The three retained targets include Percentage of approved Communication Strategy activities implemented, Percentage of cases from the Presidential Hotline resolved, and Percentage of legitimate invoices paid within 30 days of receipt.

6.3        Programme 2: Socio-Economic Support         

Programme 2 received a real percentage decrease of 1.67 per cent in its allocation. This should be considered a concern since the programme relates to the core business of the DMV, namely delivering services to veterans. Sub-programme 1 (Database and Benefits Management) and Sub-programme 3 (Socioeconomic Support Management) received reduced allocations of 7.61 per cent and 8.55 per cent respectively. The reduction for Database and Benefits Management is a concern. Nonetheless, there is also an important increase of 26.81 per cent in Sub-programme 2 (Health Care and Wellbeing Support). This shows that emphasis is being place on the provision of health care services for military veterans as per Minister of Defence and Military Veterans priorities. 

In terms of economic classifications, the allocations remained relatively stable. There is an increase in the allocation for Goods and Services from R34.2 million in 2016/17 to R53.4 million in 2017/18. There is also an increase in the allocation for Contractors from R24.5 million in 2016/17 to R34.4 million in 2017/18. Contrary to 2016/17 in which there was a decrease in the allocation for Travel and Subsistence from R6.2 million in 2015/16 to R2.6 million, this year the allocation increases substantially to R10.9 million.

In terms of performance indicators, Programme 2 has four strategic objective annual targets and four 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 3: Nominal and real increases/decreases in the Socio Economic Support Programme

Programme	Budget		Nominal Increase / Decrease in 2017/18	Real Increase / Decrease in 2017/18	Nominal Percent change in 2017/18	Real Percent change in 2017/18
R million	2016/17	2017/18
Sub-programme 1: Database and Benefits Management	11,2	11,0	-  0,2	-  0,9	-1,79 per cent	-7,61 per cent
Sub-programme 2: Health Care and Wellbeing Support	56,9	76,7	19,8	15,3	34,80 per cent	26,81 per cent
Sub-programme 3: Socioeconomic Support Management	226,0	219,7	-  6,3	-  19,3	-2,79 per cent	-8,55 per cent
TOTAL	294,1	307,4	13,3	-  4,9	4,5 per cent	-1,67 per cent

 

6.4        Programme 3: Empowerment and Stakeholder Management

Programme 3 received a real percentage reduction of 2.92 per cent. In terms of subprogrammes only Sub-programme 2 (Empowerment and Skills Development) has the reduction of 12.17 per cent as compared to 2016/17. Sub-programme 1 (Provincial Offices and Stakeholder Relations) and Sub-programme 3 (Heritage, Memorials, Burials and Honours) received increases of 4.5 per cent and 37.64 per cent respectively.

In terms of economic classifications, the allocations remained stable between the 2016/17 and 2017/18, with little noticeable variations. Only Stationary received a slightly increased allocation. In contrast, Training and Development, received a decreased allocation of R66.4 million in 2017/18 as compared to R71.3 million in 2016/17. No allocations were made for Machinery and Equipment, and Software and other intangible assets.

In terms of performance indicators, Programme 3 has four strategic objective annual targets and five annual performance targets. Only one target, “Number of agreements established at continental and international levels per year”, was removed.

 

 

 

 

 

 

Table 4: Nominal and real increases/decreases in the Empowerment and Stakeholder Management Programme

Programme	Budget		Nominal Increase / Decrease in 2017/18	Real Increase / Decrease in 2017/18	Nominal Percent change in 2017/18	Real Percent change in 2017/18
R million	2016/17	2017/18
Sub-programme 1: Provincial Offices and Stakeholder Relations	44,2	49,1	4,9	2,0	11,09 per cent	4,50 per cent
Sub-programme 2: Empowerment and Skills Development	100,7	94,0	-  6,7	-  12,3	-6,65 per cent	-12,19 per cent
Sub-programme 3: Heritage, Memorials, Burials and Honours	14,9	21,8	6,9	5,6	46,31 per cent	37,64 per cent
TOTAL	159,8	164,9	5,1	-  4,7	3,2 per cent	-2,92 per cent

 

7.         PROPOSED AMENDMENTS TO THE MILITARY VETERANS ACT, AND REGULATIONS

The Amendment of the Military Veterans Act, No. 18 of 2011 and the Military Veterans Benefits Regulations of 2014, will play a significant and critical role with regards to the inclusion of the dependants of the military veterans in all benefits. It is however envisaged, that the possible engagement with relevant stakeholders will be conducted so as to meet all requirements for this endeavour.

8.         COMMITTEE OBSERVATIONS

The Committee made the following observations in terms of the 2017/18-2019/20 Annual Performance Plan:

 

1. The Committee commends the DMV on its new Organogram, and encouraged the department to ensure that it is fast-tracked so that benefits are delivered to deserving military veterans.
2. The Committee commends the DMV for including the military veterans’ demographics for the first time in the Annual Performance Plan.
3. The Committee commends the DMV on improving on the delivery of houses. Although only 130 were achieved last year, it was indicated that about 1 400 will be achieved in 2017/18, which is higher than the planned 1 000. This is a positive development. However, it must be ensured that the beneficiaries of the houses are those on approved lists.
4. The Committee, is however, concerned about the 3 989 military veterans that are under the age of 35.
5. The Committee is concerned about underspending of the Department, while some beneficiaries have not received the benefits.
6. The Committee is concerned about the Database verification, which is central in the distribution of benefits to deserving military veterans. Furthermore, the reduced allocation for Database Management is also concerning.
7. The Committee is concerned about the Internal Audit capacity, which has also received reduced allocation. Internal Audit was identified by the Committee since the establishment of the Department as a risk. The Auditor General, as well as the Standing Committee on Public Accounts, also raised concerns about internal audit. 
8. The Committee is concerned about the vacancy rate of 21 per cent.
9. The Committee is concerned about the over-expenditure for education benefits, as well as over commitment while there are inadequate funds.
10. The Committee is concerned about Communication. This should be made a priority. 
11. The Committee is concerned about the delays in the Transport benefit for military veterans.
12. The Committee is concerned about the long standing issue of skills audit. This will ensure that benefits delivery is fast-tracked.

 

9.         RECOMMENDATIONS

1. The Committee recommends that the DMV ensures that both underspending and overspending are avoided. The Committee will monitor this closely on a quarterly basis.
2. The Department must ensure that over-expenditure for education benefits, as well as over commitment while there are inadequate funds do not compromise the delivery of other benefits.
3. The Committee recommends that the DMV and DHS work closely together to ensure that houses are delivered for the military veterans.
4. The Committee recommends that verification of the Database be completed as soon as possible.
5. The Committee recommends that verification of the 3 989 military veterans under the age of 35 be done, and report be provided.
6. The Committee recommends filling up of all funded posts as soon as possible to ensure that benefits are delivered.
7. The Committee recommends that measures be put in place to ensure that Internal Audit is adequately capacitated.
8. The Committee recommends that the DMV constantly engages with relevant stakeholders to ensure the delivery of benefits to military veterans.
9. The Committee recommends that the Transport benefit be finalised as a matter of urgency.
10. The Committee recommends that skills audit be finalised as a matter of urgency.
11. The Committee recommends the prioritisation of the Communication strategy.

 

 

Report to be considered