ATC210513: Report of the Portfolio Committee on Defence and Military Veterans on Budget Vote 26 Department of Military Veterans Dated 12 May 2021

Defence and Military Veterans

REPORT OF THE PORTFOLIO COMMITTEE ON DEFENCE AND MILITARY VETERANS ON BUDGET VOTE 26 DEPARTMENT OF MILITARY VETERANS DATED 12 MAY 2021

 

The Portfolio Committee on Defence and Military Veterans (PCODMV), having considered Budget Vote 26 Military Veterans, and its 2021/22 Annual Performance Plan on 11 May 2021, reports as follows:

 

1.         INTRODUCTION

 

1.1        Mandate of the Committee

 

Section 55 (2) of the Constitution of the Republic of South Africa (1996) states that “The National Assembly must provide for mechanisms (a) to ensure that all executive organs of state in the national sphere of government are accountable to it and (b) to maintain oversight of (i) the exercise of national executive authority, including the implementation of legislation; and (ii) any organ of state.”

 

1.2        Process

 

The Portfolio Committee considered the Department of Military Veterans’ 2020/21 Annual Performance Plans as well as its 2021/22 budgetary allocation on 11 May 2021. The Committee made several observations that led to recommendations to the DMV, to enhance their performance for the remained of 2021/22.

 

2.         FOREWORD BY THE MINISTER

 

2.1        The Covid-19 pandemic

 

The Minister in her Foreword, alludes inter alia to the impact of the Covid-19 pandemic and that it is important that the DMV improve access of health care to Military Veterans and their dependants. “This decision was taken in the previous financial year due to the Covid-19 pandemic and this APP will outline, amongst others, the implementation of accelerated access to health care benefit by Military Veterans and their dependants.”

 

2.2        Intergovernmental Relations

 

The Minister also notes that an important aspect of the DMV’s strategy in dealing with these challenging times of competing demands in a constrained fiscal environment, is the increased emphasis on improved intergovernmental relations on the alignment of delivering benefits to Military Veterans. This is especially important as the Department is in many instances not the final institution responsible to deliver the benefit to Military Veterans. For example, in the case of housing, provincial and local governments have a crucial role to play.

 

2.3        The Presidential Task Team (PTT) on Military Veterans

 

Of equal importance is the work of the Presidential Task Team (PTT) on Military Veterans, led by the Deputy President, which focuses on accelerating a number of areas affecting Military Veterans. These areas include but are not limited to:

 

• The finalisation of the review of the Military Veterans Act 18 of 2011 which is long overdue;
• The re-engineering of the Department organogram;
• Acceleration of empowerment of Military Veterans; and
• Acceleration of the cleansing of the National Military Veterans Database.

 

She stresses that the implementation of these accelerated issues coming out of the PTT will be one of the important activities of this financial year.

 

2.4        Vacancies and Consensus document

 

The APP points out that the DMV will prioritise the finalisation of the appointment of the Director-General and the two vacant posts of Deputy Director-General during this financial year to ensure leadership and stability of the DMV. The Director-General, in turn, points out that the DMV will undertake to implement issues raised by Military Veterans as per a signed consensus document of 22 December 2020 and monitor the developments thereof. It will also develop and implement the Complaints Management System during the 2021/22 financial year.

 

3.         MANDATE, OBJECTIVE AND CONTRIBUTIONS OF THE DMV

 

3.1        Mandate of the Department of Military Veterans

 

The Department of Military Veterans (DMV) derives its legislative mandate from the Military Veterans Act (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.

 

3.2        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.

 

1.  

 

The DMV’s Strategic Plan 2020 – 2025 as well as its Annual Performance Plan 2021/21 list the contributions that the DMV will make to the National Development Plan (NDP), the Medium Term Strategic Framework Outcomes and the Executive Authority Priorities in a tabular format, as follows:

 

 

 

 

 

Table 1: DMV contributions to the NDP, MTSF and Executive Authority’s Priorities

 

4.         COMMITTEE BUDGET REPORT 2020/21          

 

The PCODMV identified the following areas that will be subject to monitoring by the Committee throughout the 2020/21 financial year and beyond:

 

1. The Committee commended the Department on the internal measures taken to combat the spread of the pandemic and encouraged it to further enhance and follow through on these efforts.

 

1. The Department indicated that the total budgetary impact for internal and external measures, will be included in the Special Adjustment Budget where guidelines have recently been published by National Treasury. While welcoming these measures to assist military veterans and their dependents, the Committee recommended that the department develop and finalise the reprioritisation as soon as possible in order to support the military veterans’ community and give feedback to the Committee on this aspect.

 

1. The Committee stressed that it quite familiar with the process to amend an act and once again queried the timelines given that this process has first been mooted five years ago. The Committee therefore strongly encouraged the Department to speed up these processes as the amendments will assist to streamline the service delivery processes of the Department.

 

1. The Committee was not impressed that certain policies are in draft format while others are new but that these benefits have been delivered and question how such a situation can be justified. However, given the importance of the policies to deliver benefits, the Committee recommended that these processes should be speeded up and that the Department should report on a quarterly basis on the status of these policies.

 

1. The Committee welcomed the response regarding access to military hospitals and sickbays and directed that the Department should continuously ensure that military veterans have such access and that challenges in this regard should be dealt with expeditiously.

 

1. The Department indicated that they co-managed the delivery of houses through the National Department of Human Settlement and that this does not require Service Level Agreements with provinces. Given the under-performance of the Department in delivering houses, the Committee recommended that the Department update it on a quarterly basis on the progress to meet this year’s housing target (710) and to inform it timeously of challenges in this regard.

 

1. The Committee strongly emphasised that the Department should enhance its efforts to make subsided public transport available to military veterans as soon as possible, as many are indigent, rural-based and access to subsidised public transport will not only alleviate their plight but facilitate improved access to benefits and services. The Committee therefore recommended that the Department should update it on progress in this regard on a quarterly basis.

 

1. The Committee wants specific feedback on the target of employment opportunities for military veterans at the quarterly meetings, as employment opportunities will make military veterans less reliant on the Department.

 

1. Regarding the Zeal Health claim against the Department, the Committee stressed that since this matter has been coming on since at least 2016, it wants the Department to update it on this matter on a regular basis till the case is resolved.

 

1. The Committee took note of the slow progress to have a credible database and reminded the Department that they are to provide feedback in this regard at the next quarterly meeting. The Committee recommended, once again, that more effort should be put into verifying and cleaning the database given its centrality for planning and budgeting.

 

1. The implementation of the Skills Audit recommendations is an issue that is viewed as crucial to the Committee, and it was taken aback that incorrect information has been provided to it in this regard. The Committee therefore insists that the Department, at its next meeting, provide it with the correct information as also proposed by the Deputy Minister. The Committee further stressed that it expects disciplinary actions to be taken against DMV employees who have wilfully provided wrong information to Parliament.

 

1. The Committee recommended that the Department should give it feedback on the revised education policy and whether it has encountered any challenges in this regard, as well as the budgetary allocations for these institutions, at the next quarterly meeting.

 

1. The Committee recommended that it should receive continuous briefings on the progress with the implementation of the Change Management strategy. The Committee further recommended that if the necessary skills to drive the change management is not resident in the Department, they should approach the DPSA/PSC to assist them with the technical skills. In addition, the Committee wants the Department to brief it regularly on its Consequence Management efforts, with the Deputy Minister in attendance.

 

1. The Deputy Minister responded to some of the systemic issues such as the Organisational Structure, filling of leadership vacancies and change management. He agreed that he should be kept to his delegated responsibilities, and that these should be made available to the Committee. The Committee thus recommended that the Deputy Minister periodically update the Committee on these issues.

 

1. The Department indicated that the Appeals Board has been in place for five years and that it is currently chaired by Mr Mavuso Msimang. The Committee recommended that a meeting with the Appeals Board be scheduled as soon as possible to address its concerns.

 

1. The Committee encouraged the Department to enhance its efforts to place military veterans who have completed their skills development training and to ensure that it liaise with other government departments regarding initiatives that can benefit military veterans and their dependents.

 

1. The Department agreed on the importance of the Liberation History and stated that it prioritises this whenever the opportunity arises. The Committee commended the Department on this and encouraged it to further enhance this noteworthy endeavour.

 

5.         DMVs ANNUAL PERFORMANCE PLAN 2021/22

The Department of Military Veterans’ APP 2021/22 consists of four main parts namely the DMV Mandate; the DMV Strategic Focus; Measuring DMV Performance and the Technical Indicator Descriptions.

5.1.         Part A: DMV Mandate

This section lists the Constitutional mandate as derived from the 1996 Constitution and refers to its legislative mandate originating in the Military Veterans Act (No. 18 of 2011), the Military Veterans Benefits Regulations and several other acts and policies that relate to its mandate. They also list various institutional policies including the White Paper on Military Veterans, a Beneficiary Support Services Policy and the Subsidised Public Transport Policy. The DMV also states that it does not have any relevant court rulings.

 

5.2        Part B: DMV Strategic Focus

This Part deals with the DMV’s vision, mission, organisational values, situational analysis, external environment analysis, and internal environment analysis.

5.2.1.    Situational analysis

The DMV’s APP states that it operates within a context that requires an analysis of both the external and internal environments, not only to identify internal challenges, but also to leverage opportunities presented by these environments that can help them to achieve their mandate.

External Environment

The APP 2021/22 refers to the impact of the Covid-19 pandemic as well as the impact of the challenges faced by the DMV. The impact of the pandemic is described as severe, especially on elderly Military Veterans and that the database and benefits assisted the Department to support these Military Veterans.  It lists the impact of the challenges as being:

• Deficiency of the legislative regulatory and policy regime.
• Deviation from Coordination and Facilitation in line with the service delivery model.
• Services are not decentralised.
• Budget cuts.
• Organisational Structure that’s misaligned to the mandate.
• Dependency on other functional Departments on Service Delivery.
• Covid-19 pandemic impact and budget cuts.

 

The APP then lists some of the mitigation steps being taken to address these challenges. 

 

Internal Environment

The Internal Environmental section refers to the impact of the Covid-19 pandemic, stating that the DMV was one of the departments that have been affected “hard” by the pandemic necessitating changes to the Strategic Plan and the APP. It further discusses the Health benefit management, lamenting the fact that its operates on a manual system and outlining the benefits of an integrated electronic system. It is especially the management of “bills” from both the SA Military Health Services (SAMHS) and outside/private service providers, often dated 3 to 18 months, that complicate the health care benefit.

5.3        Part C: Measuring DMV Performance

This section is divided into four note-worthy subsections namely Institutional Performance Information; Key risks and mitigations; and Public entities.

5.3.1     Institutional Performance Information

The APP sets out the DMV’s contribution to the Executive Authority’s Priorities, the National Development Plan Vision 2030, and the Medium Term Strategic Framework 2019 – 2024 Priorities.

5.3.2     Key risks and mitigations

This section deals with the Key risks and Mitigating factors in the Department. Importantly, the Department states that it will strive to ensure that a culture of risk management is institutionalised to reduce risk exposure. They will regularly monitor and scrutinise these risks.  The importance of these priorities should be noted against the background of the quarterly and annually reporting on the DMV’s contribution to the NDP and MTSF priorities, while those of the Executive Authority falls within its specific mandate.

OUTCOME	KEY RISKS	RISK MITIGATION
Socio-economic status of military veterans’ community improved and sustained	Inadequate integrated internal and external business systems.	Development of integrated business systems
	Instability in strategic leadership.	Implement the approved recruitment plan
	Misalignment of the organizational structure with the Service Delivery Model (SDM).	Obtain approval and implement the aligned organizational structure and SDM.
	Inadequate legislative regulatory and policy.	Introduce amendments to the Military Veterans Act 18 of 2011.
		Alignment of the regulations to the Act
		Development of policies in line with Amended Act.
	Inappropriate organizational culture	Introduce organizational change management Processes
	Ineffective and inefficient stakeholder management and strategy.	Develop and implement stakeholder management strategy.

6.         DMV PROGRAMMES FOR FY2021/22

The 2021/22 ENE acknowledges the contribution of military veterans in the creation of a democratic South Africa and as such the DMV will over the medium term, continue to focus on delivering key benefits such as health care, housing, education, training and skills development programmes to military veterans and their dependants.

6.1        Programmes and sub-programmes

6.1.1     Overview of the FY2021/22 Budget and MTEF Estimates[1]

The APP emphasises that the DMV is now under Vote 26 in the ENE to ensure it accounts for its own budget with its own accounting and budgeting systems.

The Department’s budget will increase from R654.4 million to R663 million over the MTEF period 2021/22 to 2023/24. This should be viewed against the allocation of R683 million in 2020/21 where R137 million was taken from DMV to assist the national fight against the Covid pandemic. However, context is important in that the 2020/21 adjusted budget made provision for the R137m. Nonetheless, the 2021/22 allocation remains lower than the main allocation of 2020/21 with R28.7M.

	VOTE 26: MILITARY VETERANS
Programme		Budget
R million		Original 2020/21	Adjusted 2020/21	% of budget	2021/22	% of budget
Programme 1: Administration		138.5	138.9	28.9%	130.8	19.98%
Programme 2: Socio-economic Support		401.4	238.4	49.6%	385.9	58.9%
Programme 3: Empowerment &Stakeholder		143.1	103.1	21.4%	137.7	21%
TOTAL		683.1	480.4	100%	654.4	100%

 

The table above indicates that 49.6% of the budget in 2020 went to Programme 2 while this increased to 58.9 % for 2021. Besides Programme 2 being the largest with a R385.9 million allocations, it is also the main service delivery programme as it disburses eight of the eleven Military Veterans’ benefits. Programme 3, the other service delivery programme, is allocated the second largest portion of the budget with 21%, while the Administration Programme will receive around 20%.

 

 

	VOTE 26: MILITARY VETERANS
Programme		Budget			Nominal Increase / Decrease in 2021/22	Real Increase / Decrease in 2021/22	Nominal Percent change in 2021/22	Real Percent change in 2021/22
R million		Original 2020/21	Adjusted 2020/21	2021/22
Programme 1: Administration		138.5	138.9	130.8	-  8.1	-  13.4	-5.83 %	-9.63 %
Programme 2: Socio-economic Support		401.4	238.4	385.9	147.5	131.9	61.87 %	55.35 %
Programme 3: Empowerment &Stakeholder		143.1	103.1	137.7	34.6	29.0	33.56 %	28.18 %
TOTAL		683.1	480.4	654.4

 

The table shows that the DMV’s budget has increased with R174 million from the previous year, but if compared with the original budget of FY2021, it decreases with R28.7m. The biggest increase in real terms was in Programme 2 with R131.9 million or 55.35% from the previous year, but in comparison with the original FY2020/21 allocation of R401.4m, it decreases with R15.5m. It is assuring that both the two service delivery programmes received an increase in both nominal and real terms, but the decrease in Programme 1 should be looked at given the pivotal role of the strategic, administration and financial management of the Department. 

6.1.2     Programme 1: Administration

Purpose and performance targets

The main purpose of the programme is to provide management and strategic administration support to the Ministry, and overall management of the department. The following table shows the Programme’s annual and quarterly performance targets for FY2021/22 to FY2023/24.

Programme 1: Budgetary allocation

The Programme’s budget decreased from R138.9 m in FY 2020/21 to R130.8 in FY2021/22 or, put differently, decreased by 5.83% in nominal terms and 9.63% in real terms. However, in terms of the original allocation in FY2020/21, it decreases with R7.7m.  This is mainly attributed to the reduction in the sub-programmes 1 to 3 namely Management, Corporate Services and Financial Administration. It is especially Corporate Services, with a reduction of R10.6m that is noteworthy. It is encouraging to note that the allocation to Internal Audit has been increased – albeit with only R500 000 - given the historical challenges in this environment. This should however be compared with the original allocation of R11.4m in FY2020/21, which brings the allocation in line with the current FY.Similarly, the R7 million increase in the Sub-programme 5: Strategic Planning, Policy, M&E, is welcomed given the Auditor-General’s comments on this aspect, especially those relating to policies and procedures.

6.1.3     Programme 2: Socio-economic Support

Purpose and performance targets

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.  Programme 2: Socio-economic Support lists the following annual and quarterly targets: 

 

The Committee noted the striking change in the Output indicator of “Number of military veterans who are verified and captured on the national military veterans’ database” being amended to the “Number of approved Non-statutory forces received from the verification panel for inclusion in the Database.”  The historical trend for the Compensation benefit has decreased, hence the reduction in the target from 200 to 100 but given this reduction and effectiveness in delivering the benefit, clarity is required around the planning to migrate it to the Government Pension Administration Agency (GPAA)

 

Programme 2: Budgetary allocation

Programme 2, the main service delivery programme, saw its budget increased by R147.5 million for the FY2021/22 which in real terms is an increase of 55.35%, but in comparison with the original FY2020/21 allocation of R401.4m, it decreases with R15.2m. This is mainly attributed to the increases in especially the sub-programmes Socio-economic Support Management, and Healthcare and Wellbeing Support with R123 million and R22.6 million respectively. As pointed out above, some of the targets have been revised downwards, yet the Programme’s budget increased with R147.5 million and the Committee can request the Department to elaborate further on this observation.

6.1.4     Programme 3: Empowerment and Stakeholder Management                           

Purpose and performance targets

The main purpose of this programme is to manage and facilitate the implementation of military veteran empowerment and stakeholder management programmes. The APP lists the following performance targets for FY 2021/22 to 2023/24:

PPI 301 has been changed from “Number of memorial activities for military veterans” to “Number of memorial lectures” and raised the question about the reasons for this change since consultation with relevant stakeholders will be done in the first quarter. Concern is also expressed around the target for the memorial sites per yearthat has not been met in 2017/18; 2018/19 and 2019/20, was this target discontinued for 2020/21 and re-installed for the current financial year.

 

 

 

Programme 3: Budgetary allocation

The programme consists of three sub-programmes, namely a) Provincial Offices and Stakeholder Relations; b) Empowerment and Skills Development; and c) Heritage, Memorials, Burials and Honours.

The budgetary allocation for Programme 3 increases with R34.6 million which in real terms is an increase of 28.18%,but in comparison with the original FY2020/21 allocation of R143.1m, it decreases with R40m.This is mainly attributed to increases in subprogrammes 1 and 2 with R22.4 million and R9.1 million respectively between the previous and current financial years. As Provincial Offices are such a critical issue for the Department, the Committee should enquire how much, where and when the increase of R22.4 million will be allocated to the establishment of these offices.

7.         HUMAN RESOURCES

The APP outlines the human resource allocation in the Department as having 264 posts (261 in 2020/21) with 43 (26 in 2020/21) vacancies, 128 permanent employees (144 in FY2020/21) and if vacancies are added to the permanent employees it accounts for 171 employees (170 in 2020/21), with contract workers being 61 (63 in 2020/21)

	Permanent Employees	Contract Workers	Vacancies	Interns	Total
FY2020/21	144	63	26	28	261
FY2021/22	128	61	43	14	264

 

The Table shows a decrease of 16 permanent staff over the last two years, which is concerning given the already delicate situation with the retention of personnel as well as the number of vacancies. The latter has increased from 26 to 43 further complicating the challenges in the personnel environment. The Department should indicate how they plan to retain personnel, and more importantly as a priority, whether their approved recruitment plan is delivering the intended results.

 

8.         COMMITTEE OBSERVATIONS

 

During deliberations with the Department of Military Veterans on 11 May 2021, Members of the PCODMV made several observations related to the budgetary allocation, the performance indicators and the targets in the APP of the Department. The following were noted:

1. The Committee raised various questions around the operation of the Presidential Task Team on Military Veterans (PTT). Although the response was that the intervention by the Presidency was due to complaints from individual military veterans and associations, this does not absolve the Department of its responsibilities and the Minister still has to account for the Department.
2. It was observed that different responses regarding the existence, functionality and staffing of provincial offices, have been presented to the Committee recently. While the Department was instructed to submit a list with information on provincial offices by noon the next day, clarity was still sought on the location and functionality of all provincial offices. This also relates to the office in the Western Cape given that there was an awareness of a DMV office in Cape Town.
3. It was noted that some of the challenges besetting the DMV, and part of the reasons for its continued poor performance, was the issue of relevant competencies and experience, and the Committee wanted to know whether there is any progress in this regard. The response was the issue relates more to the organisational culture and the spirit of team work that are missing. The Accounting Officer felt that the appointment of a new D-G for five years can build a more appropriate organisational culture and team spirit.
4. The inadequate legislative regulatory and policy risks were noted as long outstanding risks and the Committee wanted to know what is being done to expedite this process.
5. It was once again pointed out that certain officials in the Department respond to queries by military veterans through referring them to the relevant official in writing. Besides this taking time and exacerbating the circumstances of the relevant military veteran, it speaks of indifference as the official should direct the enquiry to his counterpart in the Department directly.
6. The Committee observed that it should be clarified why certain targets have been decreased and others should be set higher, such as the target for an unqualified audit opinion which should be amended to a clean audit opinion. This against the background that even when sufficient funds were allocated to the Department, it still underperformed and failed to meet all its targets.
7. It was pointed out that the DMV might have various excellent policies, but if these are not funded by National Treasury it will lead to underperformance and the concomitant frustration for military veterans.
8. Members enquired whether the DMV is taking advice from both formernon-statutory and statutory forces on the acknowledgement of previous service; for instance, with the awarding of medals, etc.
9. The Department was requested to outline the timeframes for the filling of vacancies and it responded with details of the posts of the D-G, the two vacant Deputy D-G posts as well as the other vacancies. This against the background of the high unemployment rate in the country as well as the challenges posed by the Covid-19 pandemic.
10. The Committee observed that the Department often refers to the strengthening of relationship with sister departments, but have never provided specific information on how this will be achieved.

 

9.         RECOMMENDATIONS

 

The PCODMV identified the following areas that will be subject to monitoring by the Committee throughout the 2021/22 financial year and beyond:

 

1. The Committee agreed that since it has not received any official report on the PTT, the DMV should, at its next engagement with the Committee, provide a detailed report on its interaction with the PTT and what is exactly is expected from the DMV.
2. The DMV should provide the Committee with a report on all provincial offices, including its location, functionality, the staff and their qualification levels by the end of June 2021. In addition, the Committee requires an indication of the timeframes for finalising all provincial offices.
3. The Committee recommends that the DMV should report whether the qualifications of all Senior Management Service (SMS) members have been verified with South African Qualifications Authority (SAQA), and if some are outstanding, when these will be completed. The DMV should also going forward, on a regular basis, report whether progress is being made to address the organisational culture and the lack of a spirit of team work.
4. It was recommended that the DMV should address the inadequate legislative and policy risk as a matter of urgency, as it is central to addressing various other challenges to effectively deliver benefits to military veterans and their dependents.
5. The Committee recommends that the Department should provide it with the names, titles and contact details of all senior officials in order to allow Members to direct their queries from military veterans to the relevant section/branch speedily.
6. It is recommended that the DMV should provide the Committee with a report on how the targets were determined, the specific reasons for adjustments and specifically whether these were adjusted in line with the allocated budget for FY2021/22, by the end of June 2021.
7. The Department was encouraged to state up front whether the various policies are appropriately funded by National Treasury, otherwise it will defeat its purpose if these are not funded or underfunded.
8. The Department should, in writing, provide the Committee with the timeframes for filling all vacancies as well as whether it intends to acknowledge previous service from both former non-statutory forces and statutory force members.
9. The Committee recommends that the Department should provide it with specific information on how it plans to strengthen relationships with sister departments, given that this issue has been consistently raised since the advent of the 6th Parliament.

 

 

 

 

Report to be considered.

 

 

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[1]All tables used in this report reflect the original 2020/21 allocation, the adjusted 2020/21 allocation and the 2021/22 allocation. However, net and real percentage changes are calculated on the adjusted 2020/21 allocation and the 2021/22 allocation.