THE PORTFOLIO COMMITTEE ON DEFENCE,
HAVING CONDUCTED DEPARTMENTAL HEARINGS ON THE ANNUAL REPORTS OF THE DEPARTMENT
OF DEFENCE AND ARMSCOR ON
1.
INTRODUCTION
The Committee, as part of its
oversight function over the Department of Defence (DoD) and the Armaments
Corporation of South Africa Limited (Armscor), conducted hearings on their
annual reports. These reports indicated to what extend the reporting entities
achieved the objectives and measurable deliverables as stated in their
strategic business plans. The reports also included an internal audit (Armscor)
and an Auditor General audit (DoD) of the financial statements. This would
indicate to the Committee how the entities applied the budget, whether government
guidelines were adhered to and whether expenditure flowed from the strategic
plans.
This report is based on the
Presentation by the Department of Defence on their Annual Report on the
2. ANNUAL REPORT
The DoD Annual Report for
FY2005/06 aims to account for the performance of the DoD against the approved
Departmental Business Plan for the period
The DOD’s mandate is
derived from the Constitution of the
2.1.3 Vision
The vision of the
department is ‘effective defence for a democratic
2.1.4
The mission is ‘to
provide, manage, prepare and employ defence capabilities commensurate with the
needs of
2.2 Defence
Administration
The Committee identified
the issue of the integrated financial systems, and the Department needs to have
a discussion with National Treasury and report back to the Committee with an
approved document before the end of this financial year (end of February 2007)
The Committee needs a
presentation on the status of the White Paper on Peace – Keeping Missions and
the role that Foreign Affairs are playing in compiling this document.
The Committee recommended
that the planning enabler tool (GEJIMA) should be implemented in the very near
future.
The Committee also requires
feedback on the issue of lack of capacity and loss of skills in the Military
Legal Services within the next 6 months.
2.3 Force
Employment
The Committee supports
the Rejuvenation strategy to built a young dynamic force and to built the
capacity of junior leaders.
The Committee needs a
presentation on the plan of action with regard to the rejuvenation of the South
African Defence Force.
2.4 Landward
Defence
The Committee through out supports the allocation of
more funds towards:
i.
Affordability of the South African Army – reprioritisation vs.
the operating budget.
ii.
State of
iii.
Prime mission equipment.
iv.
Ammunition – Lack thereof to improve training, e.g. Oudtshoorn
v.
Revitalisation of SA Army’s Technical Support Corps
capability.
vi.
Retention of Skilled personnel.
2.5 Air
Defence
The Committee through out
support the allocation of more funds towards:
i.
Retaining the skills and experiences shortages.
ii.
Deteriorating aircraft systems which affect the training of
personnel.
iii.
SAAF force preparation and force employment funded at cost
of longer term need.
2.6 Maritime
Defence
The Committee support the integration of the
Strategic Defence Packages.
The Committee support the
allocation of more funds to retain the technical skills and expertise of the personnel
in South African Navy.
2.7 Military
Health Services
The Committee through out
supports the allocation of more funds towards:
i.
Rejuvenation of the health care professionals on all levels.
ii.
Funding for health equipment.
2.8 Defence
Intelligence
The lack of personnel and
also the location of the Defence Intelligence Headquarters needs urgent
attention.
The Committee needs a
report on whether the Intelligence Headquarters has moved within 2 months.
2.9 Joint
Support
2.9.1 Joint Support Office
The
Committee need a briefing from the Department with regard to ICT (Information
and Communication Technology) obsolescence to which extend is this a challenge
to replace this equipment.
The Committee also need an update
on the Wahlmanstahl land claims.
2.9.2 DoD
Logistic Agency
The Committee requires feedback
within 3 months with regard to the Asset management system which is not fully
compliant with GRAP (Generally Recognised Accounting Practice).
The Committee recommends an
oversight visit to investigate the following two issues:
- DoD Air Supply Unit –
deteriorating facilities and lack of equipment.
- DoD restructuring process
– DODW (Departmental Organisational
Development Workgroup) process to finalise the matter of material/logistics.
2.9.3 Human Resources Support Centre
The Committee needs to know who
qualifies for the NSF pension, it is stated that 11 558 applications was
forwarded to the GEPF and that 5 000 names was verified for the
administration of the Military Veterans.
Therefore the Committee will liaise with the Department of Defence with
regard to this matter. The committee further recommends that these options
should be advertised and that more imbizo’s should be held so that more
beneficiaries are reached.
The Committee wishes to
congratulate the Department on the passing rate of its youth foundation
learners which consist of 243 learners 98 % (passed) of which 238 are now
employed in the DoD.
2.10 Special
Defence Account
The Committee needs a
briefing on the acquisition plan of the Department on the successful
identification of the preferred bidder and approvals as well as initiation of
negotiations with regard to the supplier of the Tactical Intelligence Systems.
3. REPORT
OF THE AUDITOR – GENERAL
3.1 Emphasis of
Matter (EOM)
There is a general
concern that the AG’s report suggests that the Department is moving backwards
with regard to qualifications. (refer to P 40 of Annual report presentation).
3.1.1 The
Committee wishes to congratulate the Department on the improvement made on the
Personnel Expenditure: Commuted Overtime and Employment equity (refer to P 42
of Annual report presentation).
3.2
Qualification: Functional
& User Breakdown
The Committee recommends
that the accounting system in the office of the Departmental Revenue should be
improved.
3.3
Root causes attributed to
the qualification
The Committee recommends
that the following issues should be addressed and improved:
-
Non-compliance with regard to controls of policies and
procedures.
-
The lack of independent review and reconciliation (internal
controls).
-
Lack of skilled, competent and trained staff.
-
The lack of an appropriate integrated computerized system.
3.4
Qualification: Corrective
Measures
There should be an
improvement on the following issues:
-
Travel and Subsistence.
-
Departmental Revenue.
-
Housing Loans Guarantees.
-
Rank Review Audit.
-
Capturing of Leave
The Committee needs a
briefing in correlation to the 60 month time frame needed for the Personnel
expenditure: Unrealistic establishment referred to on page 60 in the Annual
Report presentation, the Portfolio Committee does not accept such a long time
frame as a remedial measure.
The Committee also needs a
briefing with regard to the 60 month time frame needed for the Information
systems audit referred to on page 61 in the Annual Report presentation.
3.5
Emphasis of Matter:
Action Plans
The Committee agrees that
improvement is needed for the physical asset and software and other intangible
assets.
4.
CONCLUSION
There is a need for consideration of
the Military Ombud Person within the SANDF.
The Committee also noted the
challenges raised in the DoD Annual Report and the issues raised by the Auditor
General and will monitor steps and time frames as indicated to remedy the
situation.
The Committee commended the DoD and
Armscor on their achievements despite budgetary constraints and therefore
further suggests that the Department should continue to pursue National
Treasury to allocate more funds in all the 9 programmes.