Report of the Portfolio Committee on Justice and Constitutional Development on Hearings on Annual Reports and Strategic Plans of Chapter 9 Institutions, dated 27 October 2004:
The Portfolio Committee on Justice and Constitutional Development, having considered the Annual Reports and Strategic Plans of the Chapter 9 Institutions, referred to it, reports as follows:
The Portfolio Committee will also hold hearings with the Department of Justice and Constitutional Development, on 28 and 29 October 2004, on the following matters:
• Annual Report of the Department;
• Medium Term Budget Policy Statement;
• Medium Term Expenditure Framework;
• Quarterly Financial Statements of the Department.
INTRODUCTION 1. On 12 October 2004, the Portfolio Committee called together all three Chapter 9 Institutions to hold hearings on their Annual Reports submitted for the financial year ending in March 2004 and their Strategic Plans for the same period. It was the first occasion where all three Institutions appeared simultaneously before the Portfolio Committee, a decision that fostered discussions on possible collaboration between the Institutions as well as highlighting similarities in the challenges faced by them.
2. During the budget hearings of June 2004 the approach was forward looking, but in line with past practices of the Portfolio Committee, consideration was also given to the Annual Reports of the Institutions that appeared before it. As a result the focus of the hearings in October was less on the Annual Reports, and more on the report card of the Institutions for the previous year such as their achievements, challenges in regard to their strategic plans for the previous year, possible areas of collaboration and their strategic plans in the year going forward.
3. The first part of this report deals with the achievements and challenges of the Institutions during the reporting period. The first part of the report also deals with the discussions that took place around the ‘‘emphasis of matter’’ as recorded in the report of the Auditor-General to Parliament. In the second part of the report the focus then shifts to the strategic plans for the year going forward of each institution and the third part of the report summarises the recommendations of the Portfolio Committee and the undertakings given by the Chapter 9 Institutions.
PART 1
A South African Human Rights Commission (SAHRC) 1. For an overview of the achievements and challenges of the SAHRC, see South African Human Rights Commission — Highlights and Constraints: 2003-2004, as submitted during the hearings. See further, Key Achievements of the South African Human Rights Commission 1995-2004 for a comprehensive overview of the role played by the SAHRC since its inception until 2004.
2. For the input by the SAHRC on possible areas of collaboration with other Chapter 9 Institutions, see the document entitled Collaboration amongst Chapter 9 Institutions.
3. The Portfolio Committee further engaged the SAHRC on the Report of the Auditor-General to Parliament on their financial statements for the year ended 31 March 2004. The Portfolio Committee specifically inquired as to the emphasis of matter as stipulated by the Attorney- General. The following responses were forwarded by the SAHRC:
• The AG emphasised that the SAHRC submitted their financial statements late: The CEO of the SAHRC explained that the process was delayed due to, much publicised, problems they experienced with their CFO. They did however submit their statements as soon as they were finalised and provided an explanation to Treasury. The Portfolio Committee advised the CEO to also provide an official explanation to Parliament.
• The AG emphasised that reconciliations were not prepared on a monthly basis throughout the period under review: The CEO explained that they did correct the problem towards the end of the financial year and they do now reconcile the relevant accounts on a monthly basis.
• The AG emphasised that for the year under review the staff advance policy was not adhered to: The Portfolio Committee raised issues with the CEO around the financial risk that the institution is exposed to if they do not adhere to their staff advance policy. The CEO in turn explained that they have amended and updated their policy on staff advances and took steps to limit the risk to the institution in the following manner: (1) Staff can now have access to more than one salary advance per year; (2) Only permanent staff who have been in the employ of the SAHRC for a certain period of time qualify (they have thus accrued certain benefits over time); (3) Staff are not allowed to take a bigger salary advance than their net salary per month; (4) Should a staff member resign they have to give notice and the amount can be reclaimed from them in this period since it would not exceed their net salary at any given stage.
• The AG emphasised that the internal audit function was not operational for the full period under review and further that the internal Audit Committee did not fulfil its mandate: The CEO explained that they have employed a new audit company due to problems experienced with the auditors. As far as the internal Audit Committee is concerned they have convened a new Committee that meets and will meet regularly in the new financial year.
• The AG emphasised the SAHRC’s failure to develop and implement a framework for a supply chain management policy: The CEO explained that they did introduce a supply chain management policy three months before the end of the financial year and they are currently working to ensure that the regulations are finalised before the end of this financial year.
4. The Portfolio Committee indicated that all three Institutions experienced difficulties with the proper functioning of the internal Audit Committee. The Portfolio Committee requested all three Institutions, through the CEO’s Office, to report briefly every mid-year of the financial period, after the second meeting of the Audit Committee has taken place, on any difficulties that they are experiencing within the Audit Committee. This report should be submitted to the Public Protector and the Commissioners (in the case of the SAHRC and the CGE) as well as to Parliament.
B Commission on Gender Equality (CGE) 1. For an overview of the achievements and challenges of the CGE see Commission on Gender Equality — Report on Highlights 2003-2004, a slide show presentation made by the CGE during the hearings. See also further Commission on Gender Equality Report to the Parliamentary Ad Hoc Committee for Justice and Constitutional Development outlining the achievements and challenges of the CGE since its inception in 1997.Afurther elaboration on these aspects can be found in Commission on Gender Equality Highlights of the Ten Year Review of CGE, which reviews the work of the CGE since its inception in 1997 until the end of the 2003 financial year.
2. See Commission on Gender Equality — Possible areas of synergy between CGE and other Chapter nine Institutions for the input by CGE on possible future collaboration with other Chapter 9 Institutions.
3. The Portfolio Committee further engaged the CGE on the Report of the Auditor-General to Parliament on their financial statements for the year ended 31 March 2004 (See relevant section of the CGE Annual Report 2003/2004). It was pointed out that the Annual Report contained insufficient details on the effectiveness of the Internal Audit Committee during the year under review. The CGE is to amplify or correct that aspect, of their Annual Report. The Portfolio Committee specifically inquired as to the emphasis of matter as stipulated by the Attorney-General. The following responses were forwarded by the CGE:
• The AG emphasised that the CGE failed to develop and implement a framework for a supply chain management policy: The CEO indicated that they are in the process of putting
a system in place.
• The AG emphasised that the CGE failed to put in place a fraud prevention plan as required by the PFMA: The CEO explained that they are busy drafting such a plan and should
finish it by December 2004.
• The AG emphasised that the CGE had a working capital shortfall: The CFO indicated that their assets will cover the shortfall.
C Office of the Public Protector (OPP) 1. For a detailed overview of the achievements and challenges of the OPP since its inception in 1995 until the end of the financial year in March 2004, see Report in response to the request by the Chairperson of the Portfolio Committee on Justice and Constitutional Development relating to inputs by relevant Chapter 9 Institutions.
2. The Portfolio Committee further engaged the OPP on the Report of the Auditor-General to Parliament on their financial statements for the year ended 31 March 2004 (See relevant section of the OPP Annual Report 2003/2004). The Portfolio Committee specifically inquired as to the emphasis of matter as stipulated by the Attorney-General. The following responses were forwarded by the OPP:
• The AG emphasised that the OPP failed to implement approved and formalised policies on asset management, bank and cash management and human resource management: The OPP indicated that they are in the process of putting these policies in place. The Portfolio Committee requested the OPP to inform it, per written note, once all the policies as per the
Attorney-General’s concerns have been put in place.
3. The OPP was established in 1995 but only adopted a strategic plan in March 2004. The PP explained that there was no plan in place for the first eight years since the establishment of the OPP but that since he took office in 2003 he prioritised the drafting of a strategic plan which was adopted in March 2004 and which will be revised on an annual basis with regular cycles for monitoring and evaluation. It was therefore not possible for the Portfolio Committee to analyse the
performance of the OPP for the financial year under review in reference to a strategic plan for the year under review.
PART 2
DISCUSSIONS ON STRATEGIC PLANS FOR 2004-2005
A South African Human Rights Commission (SAHRC) 1. See SAHRC Strategic Business Plan 2004/05-2006/07 for an overview of the strategic plan of the SAHRC.
2. The SAHRC emphasised the fact that the promotion and protection of human rights inevitably includes an element of ‘‘unplanned’’ work for unexpected human rights issues might arise during a financial year and the strategic plan is therefore not set in stone.
3. Upon review of the strategic plan of the SAHRC the Portfolio Committee noted that some of the outputs stipulated were too vague or general especially in reference to the key service delivery outputs and the areas of priority such as activities to be undertaken by Commissions and the organisational strategies. In reference to the actions stipulated in the strategic plan the Portfolio Committee requested more detail under each heading indicating clearly what projects will be undertaken whilst also stipulating specific time frames, and individuals responsible.
B Commission on Gender Equality (CGE) 1. See Consolidated Progress Report on 2004/2005 CGE Plan of Action, Strategic Plan 2005/2006 and Commission on Gender Equality — Annual Strategic Plan 2004/2005 for an overview of the strategic plan of the CGE.
2. The CGE indicated that they have revised their practice around the drafting of their strategic plan and instead of scheduling it close to the end of the financial year they now set out to do it already in September of each year in order to align it better with the next financial year. The
Portfolio Committee recommended that the CGE should include its restructuring activities in the strategic plan with specific time frames attached thereto. The other recommendations of the Portfolio Committee are set out below as they relate not only to the strategic plan of the CGE but impact on all Chapter 9 Institutions.
C Office of the Public Protector (OPP) 1. In the absence of a strategic plan for the financial year under review the Portfolio Committee examined the March 2004 strategic plan in order to advise the OPP on aspects that should be revised when revisiting its strategic plan in February 2005. The recommendations of the Portfolio Committee are set out below as they relate not only to the strategic plan of the OPP but impact on all Chapter 9 Institutions. 2. See The Corporate Strategy and Business Plan — March 2004 for an overview of the strategic plan of the OPP.
PART 3
A Recommendations 1. The Portfolio Committee recommended that the Annual Reports of the Chapter 9 Institutions should in future include a report card against which the strategic plan for the financial year under review could be examined. In reference to the strategic plans, each institution should indicate which objectives were met, which were not met or which were only partly met or are ongoing. This will allow the Institutions to account in a more systematic way.
2. The SAHRC’s exercise pertaining to human resources should be emulated (see relevant section of the Annual Report of the SAHRC). Implications of human resource policies should be indicated in tabular form as done by the SAHRC. Tables should also include reports on disciplinary matters.
3. The Portfolio Committee made the following recommendations upon having considered the strategic plans of the Chapter 9 Institutions:
• Strategic plans must indicate specific outputs in terms of specific projects that will be undertaken. Therefore the Institutions should avoid vague and general outputs but should rather link it to specific activities which are measurable.
• Strategic plans should in future include a column allocating projected budgetary implications to the various activities set out in the plans. This will assist the Committee during budget hearings to measure the projected costs against the actual costs incurred.
• Strategic plans should indicate the person responsible for specific activities that are mapped out in the plan.
• Strategic plans should indicate the dates by which the targets must be met.
• If any activities were carried over from the previous strategic plan, i.e. which could not be met in the previous financial year, this should clearly be indicated under a separate title.
4. In reference to possible future collaboration amongst Chapter 9 Institutions the following recommendations were forwarded by the Portfolio Committee:
• Collaborative activities between Chapter 9 Institutions should already be included in the strategic plans of these Institutions. This must involve interactive strategy sessions between relevant Institutions supporting Democracy, prior to strategic plans being drafted.
• Chapter 9 Institutions should undertake to collaborate not only in reference to resource sharing through ‘‘one stop shops’’ in all the provinces, but should undertake to engage similar systematic
problems holistically whilst adhering to their individual mandates and independence. Collaboration must also be seen within the broader context of mandates and substantial work of each Institution.
• Discussions should be held, to develop an effective relationship with the Constitutional Development Unit, of the Department of Justice and Constitutional Development, in order to facilitate mutually beneficial outcomes in matters relating broadly to the Institution’s interaction with the national executive authority.
5. The Portfolio Committee recommends that the great divide between the administrative organs and the Commissioners, as specifically identified within the CGE and the SAHRC, be resolved through development of mechanisms such as protocols or a bridging structure such as an integrated committee consisting of a few Commissioners or the Chairperson and identified administrators to deal with matters of institutional synergy, strategy and policy.
6. The Portfolio Committee recommended that the Chapter 9 Institutions should investigate the possibility of undertaking a joint review of their organisational structure and practices to highlight areas of inefficiencies, ineffectiveness, best practices and an organisational vision for the next ten years.
B Undertakings 1. All three Chapter 9 Institutions undertook to provide the Portfolio Committee with a brief report, every mid-year of the financial period after the second meeting of the Audit Committee has taken place, indicating any difficulties that they are experiencing with the functioning of the Audit Committee. This report should be submitted to the Public Protector and the Commissioners (in the case of the SAHRC and the CGE) as well as to Parliament in terms of the PFMA.
2. The CGE undertook to provide the Portfolio Committee with a short report on the internal Audit Committee indicating the functioning and effectiveness of the Committee. This report should be submitted within the next two to three weeks.
3. The OPP undertook to inform the Portfolio Committee per written undertaking, once all the policies as per the Attorney-General’s concerns have been put in place.
4. The CGE and OPP undertook to provide the Portfolio Committee, within the next three weeks, with a report card of their achievements and challenges against their relevant strategic plans (in the case of the CGE) for the financial year under review (2003-2004).
5. All three Chapter 9 Institutions undertook to provide the Portfolio Committee, through the Constitutional Development Unit, with their revised strategic plans for the year going forward, taking on board the recommendations in regard to priorities, specific budget implications, due dates and responsible individuals within the next three weeks (i.e. 2nd week of November 2004).