ATC201125: Budgetary Review and Recommendations Report (BRRR): Department of Planning, Monitoring and Evaluation (DPME), and brand South Africa: Date25 November 2020

Public Service and Administration, Performance Monitoring and Evaluation

BUDGETARY REVIEW AND RECOMMENDATIONS REPORT (BRRR): DEPARTMENT OF PLANNING, MONITORING AND EVALUATION (DPME), ANDBRAND SOUTH AFRICA: DATE25 NOVEMBER 2020

 

  1. BACKGROUND

The Portfolio Committee on Public Service and Administration (hereinafter referred to as the Portfolio Committee) having considered the directive of the National Assembly as mandated by Section 5 of theMoney Bills Amendment Procedures and Related Matters Act, No. 9 of 2009 to consider and report on the Annual Reports of the Department of Planning, Monitoring and Evaluation (DPME) and Brand South Africa tabled by the Minister of Planning, Monitoring and Evaluation as follows:

 

  1. INTRODUCTION

Parliament derives its mandate from the Constitution of the Republic of South Africa. The strategic objectives of the Portfolio Committee are informed by five strategic goals of Parliament. The functions of the Portfolio Committee on Public Service and Administration as well as Monitoring and Evaluation are as follows:

  • Participating and providing strategic direction in the development of the legislation and thereafter passing the laws;
  • Conducting oversight over the Executive to ensure accountability toParliament towards achieving an effective, efficient, developmental and professional public service;
  • Conducting public participation and engaging citizens regularly, with the aim to strengthen service delivery; oversee and review all matters of public interest relating to the public sector;
  • Monitoring the financial and non-financial aspects of departments and its entities and ensuring regular reporting to the Committee, within the scope of accountability and transparency;
  • Supporting and ensuring implementation of the Public Service Commission (PSC) recommendations in the entire public service;
  • Participating in international treaties which impact on the work of the Committee.

 

  1. PURPOSE OF THE BUDGETARY REVIEW AND RECOMMENDATIONS REPORT

In terms of Section 5 of theMoney Bills Amendment Procedures and Related Matters Act, No. 9 of 2009 the National Assembly, through its Committees, must annually compile Budgetary Review and Recommendations reports (BRRR) that assess service delivery and financial performance of departments and may make recommendations on forward use of resources. The BRRR is also a source document for the Committees on Appropriations when considering and making recommendations on the Medium Term Budget.

Moreover, the Money Bills Amendment Procedures and Related Matters Act, section 5 (3) highlights focus areas on the budgetary review and recommendation report as:

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

 

3.1Method

The Portfolio Committee on Public Service and Administration compiled the 2018/19 BRRR using the following documents:

  • The National Development Plan: Vision for 2030.
  • Medium Term Strategic Framework 2019-2024.
  • State of the Nation Address 2020.
  • Strategic Plans of the DPME and Brand SA.
  • National Treasury (2020) 4th Quarter Expenditure Report 2019/20 Financial Year, Pretoria.
  • Annual Performance Plans of the DPME and Brand South Africa 2019/20.
  • Annual Report of the DPME and Brand South Africa 2019/20.
  • Auditor-General South Africa’s outcomes of audit findings 2019/20.
  • The Portfolio Committee also met with the leadership of the Department and Brand South Africa.

 

  1. NATIONAL DEVELOPMENT PLAN VISION 2030

The Department of Planning, Monitoring and Evaluation supports the National Development Plan’s objective of anaccountable and transparent government. The Department’s focus is on strengthening accountability and improving coordination, and it works with the National Planning Commission to facilitate and monitor the implementation of the National Development Plan. The Department is responsible for mainstreaming the National Development Plan into the work of Government by drafting the Medium Term Strategic Framework to guide Government’s programme. The strategic framework includes 14 outcomes, which form the basis of the new performance agreements between the President and individual Members of Cabinet.

 

  1. MANDATE OF THE DEPARTMENT OF PLANNING,MONITORING AND EVALUATION

The mandate of the Department of Planning, Monitoring and Evaluation is derived from section 85(2)(c) of the Constitution, which enables the President to exercise authority over Members of Cabinet by coordinating the functions of state departments and administration. The primary aim of the Department is to improve government service delivery through planning, performance monitoring and evaluations. The DPME has the following key mandate:

  • Facilitating the development of plans/delivery agreements for cross-cutting priorities or outcomes of Government, and monitor and evaluate the implementation of these plans/delivery agreements.
  • Putting in place and managing guiding frameworks for strategic planning and annual performance planning in national and provincial departments.
  • Monitoring the performance of individual national and provincial government departments and municipalities.
  • Monitoring frontline service delivery.
  • Managing the Presidential Hotline.
  • Carrying out evaluations.
  • Promoting good monitoring and evaluation practices in Government.
    1. Department’s priorities over the medium-term

The priorities for the 2019/20 Annual Performance Plan of the Department of Planning, Monitoring and Evaluation are informed by the National Development Plan as translated in the Medium Term Strategic Framework (MTSF) for 2019-2024. The DPME has, through its outcomes monitoring and evaluation work, developed a number of monitoring and evaluation tools to fulfil the functions below:

  • Facilitating the development of plans or delivery agreements for the cross-cutting priorities or outcomes of Government.
  • Assessing departmental Strategic Plans and APPs to determine and enhance their alignment with the NDP, MTSF, Delivery Agreements and the budget.
  • Monitoring and evaluating the implementation of service delivery agreements.
  • Monitoring the performance of individual national and provincial government departments and municipalities.
  • Monitoring frontline service delivery across the public service.
  • Managing the Presidential Hotline.
  • Carrying out evaluations.
  • Promoting good monitoring and evaluation practices in Government.
  • Providing support to service delivery institutions to address blockages in delivery.

 

  1. DEPARTMENT’S PROGRAMME PERFORMANCE
    1. Department of Planning, Monitoring and Evaluation

6.1.1 Budget Allocated and Expenditure 2019/20

The budget appropriated to the Department of Planning, Monitoring and Evaluation in 2019/20 financial year was R956 939 million. Expenditure for the Department was R914 518 million for all the programmes which is an estimated of 95.6% budget spent. The variance was R42 421. The Department’s under-expenditure was realised on compensation of employees due to delays in implementing revised organisational structure. Programme’s budget that spent below 90% was Sector Monitoring and Evidence and Knowledge Systems, which was due to the delays in the finalization of consultancy projects and lower than projected costs on the newly introduced rapid evaluations. The underspending was mostly reported under compensation of employees as a result of delays in implementing the new organisational structure and filling of funded vacancies. However, the Department has generally spent its budget satisfactorily. 

 

The Department has also incurred an underspending on payments for capital assets due to delays in the procurement of office new accommodation for the DPME. Due to this delay, the department has not utilized the budget allocated for tenant installation. The underspending on this item was also due to lower software expenses.

 

During the year under review, the Department recorded R282.000 in fruitless and wasteful expenditure due to cancellations of travel arrangements and events and damages to vehicles. One hundred and fifty-four thousand rand (R154.000) of possible fruitless and wasteful expenditure was still under investigation as at 31 March 2020. The Department also recorded R168.000 in irregular expenditure, with R61.000 there-of being condoned. A further R894.000 of possible irregular expenditure was under investigation.

 

In terms of Human Resource Management, the Department prioritised posts based on the importance and urgency for filling. All posts were advertised in the DPSA vacancy list and for SMS posts in the national media in order to attract a large pool of suitable candidates and promote open competition. The Department filled 56 posts during the period of 01 April 2019 to 31 March 2020 and the vacancy rate at the end of the reporting cycle was 11.5%, despite experiencing a high staff turnover of 16.9%. with regard to employment equity, the department has 2.1% people with disabilities. In addition, the Department has 59.4% and 50.02% of females occupying SMS positions, which is an improvement from 2018/19 financial year. 

 

 

Table 1: Appropriation per programme (R’000)

Programme R'000

Final Appropriation

Actual

Expenditure

Variance

Shifting of funds

Virement

1. Administration

188 079

178 728

9 351

-

3 884

2.National Planning Coordination

85931

79 639

6 292

-

-

3. Sector Monitoring Services

82 885

71 298

11 587

-

270

4. Public Sector Monitoring & Capacity Development

86 545

82 576

3969

-

(330)

  1. Evaluation, Evidence and Knowledge Systems

44 037

34 739

9 298

-

(3 824)

  1. National Youth Development

469 462

467538

1 924

-

-

Total

956 939

914518

42 421

-

-

Source: DPME Annual Report 2019/20

 

6.1.2Programme Performance

The Department has six programmes in 2019/20 financial year organised as follows:

6.1.2.1Programme 1: Administration

The main objective of the programme is to provide strategic leadership, management, administrative, financial and human resource services to enable the Department to achieve its strategic and operational goals. The programme’s key focus is to implement revised organisational structure and recruitment of key personnel, improve the quality of performance information, maintain good financial management practices to sustain clean audit outcomes and strengthen communication around the National Development Plan.

Programme 1 has spent R178.7 million of the allocated budget of R188.1 million, which is an estimated 89.4% in 2019/20 financial year. The programme had seventeen (17) predetermined targets. Of total targets, the Department achieved fourteen (14) targets and two (2) were not achieved.  

The average vacancy rate was at 11.5% and was above the 10% acceptable norm in the public service. The target was not achieved due to delays in filling some senior management posts in the sixth Administration. The Department developed a recruitment plan to fast track the appointment process. The Department submitted the Annual Performance Plan to the National Treasury timeously, but not tabled in Parliament as per required schedule due to communique to table Annual Performance Plans (APPs) after the adoption of the Fiscal Framework. Four quarterly performance reports were submitted to the Executive Authority and National Treasury within 30 days at the end of the quarter. A Communication strategy and plan for media engagement was reviewed.

Section (1) (f) of the Public Finance Management Act, states that, “accounting officer of a department must settle all contractual obligations and pay all money owing, including intergovernmental claims, within the prescribed or agreed period”. In view of the above, the Department achieved 100% of the payment of valid invoices within 30 days. In fact, the Department processed payment to suppliers within 7 days. The Department achieved 94% of Senior Management Service (SMS) disclosing financial interest in terms of Chapter 3, C.1 of the Public Service Regulations (PSRs), to their respective Executive Authorities (EAs), particulars of all their registrable interests (e.g. companies and properties) not later than 30 April each year, in respect of the period 1 April of the previous year to 31 March of the current year.

6.1.2.2Programme 2: National Planning Commission

The purpose of the programme is to facilitate and coordinate macro and transversal planning across government and coordinate planning functions in the Department. The key objective of the programme is to institutionalise planning across government by providing guidance on short, medium and long term planning to support the implementation of the National Development Plan Vision 2030.  In addition, the programme supports the work of the National Planning Commission (NPC).

The key focus of the Department on the programme was to finalise a framework on the institutionalisation long term planning.Furthermore, the programme must finalise the revision of planning frameworks and ensure the alignment of strategic plans, annual performance plans and Medium Term Expenditure Framework (MTEF) budget allocations with the Medium Term Strategic Framework (MTSF) priorities.

In addition, the Department continued to work with the Department of Rural Development and Land Reform (DRDLR) to finalise the transfer of the spatial planning Programme. The Department has been working on developing the National Spatial Development Framework (NSDF) with support from the National Planning Commission in order to guide the development of sub-frameworks.

The Department worked in collaboration with National Treasury to ensure that the national budget is directed towards the National Development Plan (NDP)/MTSF priorities. The Department was tasked to develop and implement planning frameworks to align strategic plans and annual performance plans to the frameworks and ensure the prioritisation of resources. The Department also conducts socio-economic impact assessments on new and existing legislation and regulations to ensure alignment with the NDP to mitigate unintended new policies.

Programme 2 has spent R79.6 million of the allocated budget of R85.9 million. The Department had thirteen (13) predetermined targets. Of all targets, the programme achieved eleven (11) and two (2) were not achieved. Target not achieved include Integrated Development Planning Bill and Annual Budget Prioritisation Framework for the 2020/21 financial year. The IDPF Bill was not finalised due to the introduction of the District Development Model (DDM). The development of the Budget Prioritisation Paper will be improved by working closer with National Treasury during the budgeting and prioritisation process. 

The Department developed guidelines for the development of the NDP 5-year implementation plan. Furthermore, a guideline for integrated planning was developed and an assessment report on the review of the planning cycles. The Department achieved four research projects in support of the NPC. The Department submitted assessment reports on the second draft Annual Performance Plans to all national departments. Assessment includes the Annual Performance Reports of the departments in all nine provinces. The Department issued Guidelines for Quarterly Performance Reporting in both the national and provincial departments.

6.1.2.3Programme 3: Sector Monitoring Services

The programme is responsible for promoting good Monitoring and Evaluation (M&E) practices in government, conducting management performance assessment and support, frontline service delivery monitoring and support and government-wide planning and M&E capacity development and learning. The branch will also be responsible for the proposed Regional Offices. Whereas the OME Branch’s focus is on the management of the outcomes system and the achievement of government’s priorities, the focus of the IPM&E branch is on what can be done to make the organisation function better.

 

Programme 3 has spent R71.3 million of the allocated budget of R82.9 million. The Department had ten (10) predetermined targets, seven targets were achieved and three (3) were not achieved. Three targets not achieved under Programme 3 include monitoring report to Cabinet not produced, two progress reports on the Special Presidential Package on Mining towns and labour sending area and performance agreement of the Executive Authority.

 

The Department produced one consolidated outcome report. Integrated Monitoring Framework was combined with MTSF. The Department reviewed and approved guidelines for Outcomes Co-ordination. A total of 24 MTSF Outcomes reports have been produced and presented to Cabinet. The Department enrolled 35 municipalities as per nomination by provincial departments of Cooperative Governance and five additional self-assessments. Furthermore, the department produced 6 improvement plans for the municipalities.

 

The Department was responsible to coordinate and monitor government departments in implementing projects and fast-tracking services through Operation Phakisa. The Department produced three (3) comprehensive Operation Phakisa Integrated Progress reports. With regard to the Distressed Mining Communities, the Department produced three comprehensive progress reports in a form of briefing notes on Special Presidential Package for the Revitalisation of Distressed Mining Communities and Labour sending areas. 

 

6.1.2.4Programme 4: Public Sector Monitoring and Capacity Development

The purpose of this programme is to develop the country’s long-term vision and national strategic plans and contribute towards better outcomes in government through better planning, better long term plans, greater policy coherence and a clear articulation of long term aspiration. The main responsibilities of the programme is to institutionalise and strengthen planning in government by facilitating the development of sectoral plans, ensuring coherence between plans, policies and service delivery across government, ensuring high-level priorities are fed through into plans across all spheres of government and engaging stakeholders on the output of the planning process to ensure buy-in.

 

Programme 4 spent R82.6 million of the allocated budget of R86.5 million. The programme had nine (9) predetermined targets. Of all targets, eight (8) were achieved and one (1) was not achieved.Target not achieved was the annual report Institutional capacity improvement framework. The Department approved a report on submission of Directors-General Performance Agreements adhering to Heads of Department Performance Management and Development System (HPMDS).  The Department developed strategy for the implementation of the Head of Public Administration.

Monitoring adherence of payment of suppliers within 30 days in the public service remain the responsibility of the Department. A total of four monitoring reports on the payment of 30 days to service providers in the public service were produced on a quarterly basis. An annual and Mid-term overview reports on the status of frontline performance and service delivery was produced. 

6.1.2.5 Programme 5: Evaluate, Evidence and Knowledge Systems

The purpose of the programme is to coordinate and support the generation, collation, accessibility and timely use of quality evidence to support performance monitoring and evaluation across government coordinate and support the generation, collation, access and timely use of quality evidence to support PM&E across government.

 

Programme 5 spent R34.7 million of the allocated budget of R44.0 million. The Department had nine (9) predetermined targets for the financial year. Of the total targets, eight targets were achieved and one was not achieved. Targets not achieved include three (3) evaluations report not approved by the Evaluation Steering Committee, and report on training courses was not produced.

 

  1. BRAND SOUTH AFRICA

7.1 Mandate of Brand South Africa

Brand South Africa(BSA) was established as a trust in 2002 and gazetted as a schedule 3A public entity in accordance with the PFMA No.1 of 1999. Its purpose is to develop and implement a proactive and coordinated international marketing and communications strategy for South Africa; to contribute to job creation and poverty reduction; and to attract inward investment, trade and tourism.

 

BSA aims to make an indirect contribution to economic growth, job creation, poverty alleviation and social cohesion by encouraging local and foreign investment, tourism and trade through the promotion of the Nation Brand. BSAdevelops and implements a proactive and coordinated international marketing and communications strategy for South Africa to contribute to job creation and poverty reduction, and to attract inward investment, trade and tourism.

 

  1. Budget allocated and expenditure
    1. Summary and Analysis of Annual Financial Statements

Budget allocated to Brand South Africa was R205.9 million and with expenditure ofR201.8 million.In terms of gender equity in Brand SA, females represent 63% of the total workforce with males comprising 37% of the remaining employee profile. Of 63% female representation, 47.37% female are at management level which is lesser than the acceptable threshold. There is 5.01% decrease in female representation at management level due to resignation of female member. Currently individuals with disabilities are not represented within the current staff complement. 

 

  1. Programme Performance

The BSA hasthree programmes which are as follows:

 

7.2.2.1Programme 1: Administration

The programme seeks to provide management and leadership to develop standardised format of guidelines and templates to strengthen the means of verification and collecting and reporting on performance information. The programme had six predetermined targets for 2019/20 financial year. Of total targets, five were achieved and one not achieved. 

7.2.2.2Programme 2: Brand marketing and reputation management

The programme seeks to develop and articulate a Nation Brand identity that will advance South Africa’s long-term reputation and global competitiveness. This includes a focus to research and monitor sentiment and performance of the National Brand to analyse trends and provide insights to inform decision making and communication; and then to both proactively and reactively communicate the country’s value proposition, values and highlight progress being made.Programme 2 had 16 predetermined targets in 2019/20 financial year. Of 16 targets, 13 (81%) were achieved and 3 (19%) targets were not achieved.

 

  1. Programme 3: Stakeholder relationships

The programme seeks to build and leverage collaborative partnership, to participate, to integrate and coordinate efforts and approaches to market the Nation Brand identity and promote the Nation’s value proposition and to interface meaningfully with stakeholders who drive or influence the Nation Brand and its reputation. Programme 3 had 5 predetermined targets in 2019/20 financial year. Of 5 targets, 4 (80%) were achieved and 1 (20%) targets were not achieved.

 

  1. AUDITOR-GENERAL OUTCOMES

8.1 Predetermined objectives

The Auditor-General (AG) audited the financial statements of the Department of Planning, Monitoring and Evaluation comprising of appropriation statement, the statement of financial position as at 31 March 2020. The financial statements are in accordance with Modified Cash Standards prescribed by National Treasury and the requirements of the Public Finance Management Act (PFMA).

8.1.1 Predetermined objectives

The Auditor-General did not identify any material findings on the usefulness and reliability of the reported performance information for the following programmes: National Planning Coordination.

 

8.1.2 Achievement of planned targets

The AG referred to the annual performance report on page (s) 33 to 64 for information on the achievement of planned targets for the year.

 

8.1.3 Adjustment of material misstatements

The AG did not identify any material findings on the usefulness and reliability of the reported performance information for this programme. Programme 4: Public Sector Monitoring and Capacity Development. 

 

8.1.4 Compliance with legislation

The AG performed procedures to obtain evidence that the Department of Planning, Monitoring and Evaluation had complied with applicable legislation regarding financial matters, financial management and other related matters. The AG did not identify any instances of material non-compliance with specific matters in key legislation.

8.1.5 Internal Controls

Internal controls in the department were considered to be relevant to AG’s audit of the financial statements, reported performance information and compliance with applicable legislation. The AG did not identify any significant deficiencies in internal controls.

 

  1. OBSERVATIONS AND KEY FINDINGS

The Committee made the following observations and findings:

 

The Department

  1.             The Portfolio Committee noted and commended the Department of Planning, Monitoring and Evaluation (DPME) for achieving the seventh clean audit in consecutive years. The Department had achieved 97% of planned targets.

 

  1. The Committee noted that the Department was unable to finalise the Integrated Development Framework Bill due to the incorporation of the District Development Model. The Department was advised to speed up the process of finalising the Bill. The Department was requested to brief the Committee in March 2021 on the result of the piloted District Development Model, which seeks to ensure that each district or metro has a single development plan, which will be formulated jointly by national, provincial and local government as well as business, labour and community in each district or metro.  

 

  1. The Department in collaboration with other relevant departments participated in the intervention (Section 100 of the Constitution) in the North West Province to document and develop case studies in order to strengthen existing loopholes in the system that led provinces to be placed under national administration.

 

  1. The Committee noted the progress and effort with regard to developing strategies for appointing the Head of Administration to be located in the Presidency.

 

  1. The Committee appreciated the efforts made by the President in collaboration with the Department of Planning, Monitoring and Evaluation to finalise and sign performance contracts on the 18 October 2020 with the Ministers. The Committee was concerned about delays in finalising the performance contract of the Deputy Ministers.

 

  1. The Committee appreciated the Department’scommitment to brief the Committee on the COVID-19 expenditure once concluded. 

 

  1. The Committee welcomed the launch of the new app of the Presidential Hotline called Khauleza.The app will accelerate call resolutions and increase accessibility to the hotline.

 

 

Brand South Africa

 

  1. The Committee noted an improvement of audit outcomesat Brand South Africa in the 2019/20 financial year. The organisation had achieved 98.34% of its planned targets.

 

  1. The Committee was of the view that Brand South Africa has to move with speed in concluding the suspension of the Chief Executive Officer since the Board has been fully appointed. Delay in finalising this critical position for the organisation impacts on the stability and good governance of the entity.

 

  1. The Committee was concerned about increasing vacancy rate from 14% in the 2018/19 financial year and 19.3% in 2019/20 financial year.Although the Committee noted that an increase in the vacancy rate was due to a combination of factors such as resignation and dismissals, Brand SA has to prioritise the filling ofeight critical funded positions.

 

  1. Brand South Africa’s target to employ 2% of people with disabilities in the entity had decreased from 2% to 0% in the 2019/20 financial year. The Committee urged Brand South Africa to commit to appointing people with disabilities. The organization can attract these potential employeesfrom the higher learning centres before completing their highest qualification and give them internship programme.

 

  1. The Committee urged Brand SA to attend to all audit outcomes findingsand ensure that the organisation worked on tightening internal controls in areas highlighted by the Auditor-General South Africa. 

 

 

  1. RECOMMENDATIONS

The Committee recommendsthe following:

The Department

 

  1. The Department should swiftly finalise the Integrated Development Framework Bill after having incorporated best practices and lessons learned from the District Development Plan. The Department should table the Bill at least by the second term of 2021/22 in Parliament.

 

  1. The Department should take the lead in documenting case studies on the North West province being put under Section 100 of the Constitution. Documented case studies should be used to develop regulations that will guide interventions to prevent or implement the process towards invokingSection 100 of the Constitution.

 

  1. The Department should work closely with the Department of Public Service and Administration in developing strategy for the establishment of the Administrative Head as envisioned by the National Development Plan to manage career incidents of the Heads of Department and to stabilise the political-administrative interface.

 

  1. The Department should take steps towards disciplining officials who comply with the Financial Disclosure Framework outside of the compliance period.

 

  1. The Department should provide a report on the status of lifestyle audits for the Executive Authorities as soon as it becomes available, in order to comply with the purpose of eliminating corruption.

 

  1. The Department should finalise and presenta comprehensive report on the delegated authority of all Deputy Minister’sin government by March 2021.

 

  1. The Department should ensure that internal controls are effective to curb wasteful and fruitless and irregular expenditure.

 

Brand South Africa

 

  1. Brand South Africa should move with speed in concluding the disciplinary process of the Chief Executive Officer since the Board is fully appointed.

 

  1. Brand SA should fill critical positions to ensure stability and accelerate performance of the organisation. In filling critical positions, people with disabilities should be prioritised since the organisation currently does not have representation of people with disabilities.

 

  1. Brand South Africa should address and strengthen all areas identified in the AuditorGeneral’s audit outcomes and report on progress to the Committee byMarch 2021.

 

  1. CONCLUSION

The Portfolio Committee commended the Department of Planning, Monitoring and Evaluation for achieving clean auditsover the consecutive years up tothe 2019/20 financial year. However, the achievement of clean audits needsto be translated intoimproving service delivery across government through planning, monitoring andevaluation.

 

Brand South Africa will undertake coordinated initiatives to build South Africa’s reputation and to contribute to the country’s global competitiveness. Brand South Africa continuesto build bridges across the continent, which is a noble gesture.

 

Report to be considered

 

 

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