JOINT BUDGET
COMMITTEE REPORT ON THE HEARINGS ON THE SECURITY CLUSTER 2006
The Joint
Budget Committee reports as follows:
The Joint
Budget Committee (henceforth ‘Committee’) has to on a regular basis monitor
monthly revenue and expenditure as published by department to determine whether
expenditure is in line with budget projections. The intention of the committee
is to explore if departments spend encompasses the following dynamics:
·
The principle of value for
money.
·
Linkage between expenditure and
stated objectives in Strategic Plans
·
Ascertaining if Strategic Plans are
measurable, achievable and sustainable.
It is for
these reasons that the Committee planned to hear submissions from National
Departments within the Security Cluster, from 14th to
Theme 1: Security Cluster
·
Department of Correctional Services
·
Department of Safety and Security
·
Department of Justice and
Constitutional Development
·
Department of Defence
·
Department of Home Affairs
The report
outlines submissions of the various departments within the Security
Cluster. Section 2 lists the general
concerns and recommendations of the Joint Budget Committee on the MTBPS.
The following departments did not make any submissions
to the Committee:
·
Department of Home Affairs;
The delegation of the following Department of Defence
made submissions to the Committee, but did not have either the executive
authority or accounting officer present:
The Committee accepted that they had changed dates of
the hearings to accommodate departments and would accept that Defence did not
have their Minister or DG and Accounting officers present but acknowledged that
all chief director and head of departments were sufficiently present to allow
the presentation in person.
The Committee reprimanded that this would not
happen in future and that the Department has to be represented by their
Executive Authority in the person of Minister or Director General and Chief
Accounting Officer for future MTBPS hearings to the Committee.
The
Committee’s mandate regarding the MTBPS requires it to consider the
distribution of available financial resources for expenditure against
government policy priorities. This mandate is distinct from that of the
Portfolio and Select Committees on Finance, which deliberate on the
macro-economic, fiscal and intergovernmental dimensions of the MTBPS
respectively.
The
Committee has interpreted its mandate to mean that it should consider the
following:
The hearings aim to addressing these issues, and preparing the Committee
and Parliament for its deliberations and vote on the Budget itself next year.
The
Department of Correctional Services highlighted their strategic objectives
during their presentation to the Committee. These strategic objectives
are: Master Information Systems Plan,
Seven Day Establishment, Integrated Human Resource Strategy, Other Corporate
Projects, Human Resource Development, Security Equipment, Management of Remand
Detainees, Overall of Social Reintegration, New Generation Correctional Centres
and Development and Care.
During the
current financial year the Department have focused on several improvements to
increase the compliance with internal controls. These improvements were
necessary as previous years’ audit reports highlighted queries regarding
internal control issues. The Department has received qualified audit report for
the last couple of years. Some of the improvements of compliance with internal
control are being done continuously. These include on-site verifications
conducted by the departmental inspectorate and Internal Audit Units, as well as
the training of managers in logistics and financial management.
According to
the adjusted estimates per programme (2006/07), inter programme shifting of
funds occurred. The bulk of the funds shifted were to Compensation of Employees
from the Programme Security to align the budget allocation with new approved
posts. Funds were also shifted from
Goods and Services under Programme: Facilities to Programme: Care for the
purposes of financing nutrition.
From the
current state of expenditure per programme, it is clear that after six months
of the current financial year, that most programmes have been spending more or
less the same as the total spending for the vote (41.87%). Only one programme,
the Programme: Facilities have only spent 31.96% of its budget by
The
Committee enquired about the allocation of budgeted funds and financial
problems relating to the New Generation Correctional Centre in
The
Committee questioned the department if they did not take cognisance of the risk
factors associated to building construction. The department had to appoint
private Quantity Surveyors to re-cost the expenses relating to the building of
the facility because with recent boom in building industry and market, the price of materials have escalated dramatically. The actual
costing for
The
Committee enquired about the contracting out of catering services and what
could be done to reduce the cost. The department responded that most facilities
are still doing their own catering. They had taken advice on
The
Committee enquired about the implementation of the strategic objectives and
what the problems were around these objectives. Are they not in a position to
deliver on the stated objectives? The department acknowledged that in setting
the objectives it was too broad which provided a limitation around measuring
the objectives and thus the department is currently in the process of
re-looking at the objectives to better deliver on the targets they are setting.
The
Committee enquired about the proactive steps the department was taking to
ensure that they spend the budget available for the rest of the year. The
department responded stating that they have taken proactive steps looking at
expenditure – the fact that they have surrendered funds to treasury is due a
process of introspection. They have set better time frames and have re-planned
to spend funds, except those funds that have already been surrendered by
Treasury.
The
Committee enquired if the costing of salary increases for level 6 and 7
personnel was budgeted for. The Department responded by stating that provision
was made in the budget for the increase from level
The
Committee enquired about the barriers for department, which have been projected
to 2009. The department responded by stating that the barriers related to the
vetting process. The department have created a component in the department for
vetting of selected position dealing with sensitive document.
The
department stated the Inmate programme at Durban Westville provided
difficulties with the integrity in the way it was implemented. In some
instances staff have caused the system to fail.
Purposes for counting and auditing funding would have been centrally located to
departments.
The
Committee enquired why the Balance Score Card has not yet been implemented. The
department confirmed that the Balance Score Card has not been implemented. It
is a process that they are striving to have in place and they are dealing with
it through their strategic plans.
The
Committee enquired about the status of the recommendations made by the Jali Commission. The department replied that the Jali Commission report progress has been given to the
Minister to table in Parliament. They commented that internal capacity was
established to implement recommendation they have identified each
recommendation and constructed steps to respond to it and have a report that
details the responses. The issue of prosecution will however provide a problem.
Implementing the recommendation has financial implications. They would need
funding going forward with the Commission’s
recommendation
The
Committee enquired why a shift occurred in funds from Care under the sub
programme. The department responded that a shift under Care was as a result of
a consequence of an escalation in medical treatment – this necessitated an
adjustment.
The
Committee enquired about the Kimberley Prison Facility and the reasons why the
facility has not been erected as well as the figures that do not telly.
According to the department’s delegation, the construction of new correctional
centres is a sensitive and complex issue. The department regrets any delays and
stated that it is as a result of a combination of external factors. One of the
consequences of the delay is the delay in the employment of new staff.
According to
the department, the billing for new generation correctional facilities rest
with Public Works they spent time on design, with the approval of the White
Paper the designing had to be amended in line with the demands of the White
Paper. Cost indicators were not in line with the latest trends in the building industry.
The department used an independent quantity surveyor and are studying the
reports. The department would adopt a
phased process to see what procurement options they would employ,
once the final recommendation are received the department would then have to adjust
its budget accordingly.
The
Committee enquired about the cost implications of outsourcing the catering
function. The department responded that they did not have the specific cost of
catering. The department explained that the costs to be more than catering. It
also includes installation of a new planning system and training of offenders.
The department
shared that service providers for catering had to use the departments own
produce as part of the contract. The process is not simple to have proper
planning system, which they did not have before. Since the question around cost
arose, the department informed the Committee that mass catering is better to
have it outsourced while they were upgrading.
The
Committee enquired about the announcement in the State of the Nation address in
2005 and 2006 the department flagged that they would be building four new
correctional facilities what has happened to this in the process. The
department answered by stated tat the escalation in terms of costs in the built
industry will determine if it would be four or five facilities that would
finally be built but they are talking to Treasury. They were aware that Leeukop and Pollsmoor were
identified as sites for upgrades but due to the fact that those facilities are
built on prime land they have had pressure from the private sector and thus
withdrew those two sites marked for development.
The
Committee enquired about the IT facilities within Correctional Services and
wanted to know if all facilities had access to IT. IT is centralised from head
office they cannot answer, not all have IT specialist but yes all facilities have
some form of an IT person. What % of correctional centres is connected? All
centres are basically connected.
The
Committee enquired whether the Department would in position to spend their
budget this year. The department stated that they have the capacity to spend
their budgets. The spending expenditure patterns of past
years indicates that they would be able to spend the budget by at least
98%, they committed not to spend in the March boom only.
The
department reminded the Committee that the originator of 8 prisons was the
State President and Parliament and they did not come to parliament they have
interacted with the portfolio committee on security.
The
Committee enquired about what was informing these projections? Why? Why? The
Committee stated that they needed to have more time and that the department
should come properly prepared with the relevant to financial information next
time to answer in-depth.
The
Committee reminded the department that it has a monthly oversight function over
budgets and they should anticipate more interaction with the Committee. The
Committee requested the department to within 7 days to report back to the
Committee on all unanswered questions.
The department was welcomed by the Committee who
expressed their thanks for the National Commissioner of Police, Commissioner
Jackie Selebi’s for attending the hearings and in
taking the function of the Committee’s requirement seriously. The National
Commissioner was invited to make opening remarks.
An overview
of budgeted versus spending for the first 6 months of the 2006/07 financial
year reveals that all programmes are spending close to the total spending % of
the vote (45.6%). The programmes of the Department are: Administration, Visible
Policing, Detective Services, Crime Intelligence and Protection and Security
Services. Programme: Visible Policing has been identified as one of the
high-level medium term policy priorities of the department. Spending as
outlined in the New Economic Reporting Format Expenditure table reveals that
current payments are closely related to the 45.6% spending of the vote. Of
significance is the 21.6% spending on buildings and other fixed structures. Also, after six months, the Department has
already spent 73.1% of their allocation for transfers to provinces and
municipalities.
The key operational priorities of the South African
Police Services include amongst others, dealing with organised crime, combating
serious and violent crimes, particularly in the high crime areas and enhancing
the control over ownership and possession of firearms, the enhancement of
service delivery especially through sector policing, and combating crimes
against woman and children.
Furthermore,
the department stated that it was operating under the principle of value for
money for projects involved. It had linked the strategic plans with strategic
objectives which are measurable achievable and sustainable but that time will
really tell in they will be sustainable.
The Committee
noted that it was an interesting presentation but enquired about the spending
trends and the assurance that the department would be in position to spend its
budget. The department responded by stating that they had started the budget
with R 17 billion six years ago and currently they receive 28 billion. Spending
patterns indicate that they have used the budget and have given Treasury back
only R1 000-00 in change.
The
Committee enquired about priority setting of spending and the assurance that
the department would spend the money given for the 2010 World Cup. The
department assured the Committee that when money is given for priorities the
department ensures money are located according to
those priorities. They managed the
The
department reported that the IT system is efficient to indicate staff turnover.
It took the South African Police Services 4 years to develop and locate issues
internally. The Committee enquired about
the remuneration of the police officials to ensure that they can improve the
life of those people through a decent wage system. Also, the question was
raised by the committee whether any form of alternative incentive systems were
available as the merit system in education to compensate teachers The Department of Safety and Security has
raised the salaries of the police by over 34% over the last three years. The
increase only applies to the ranks between constable and senior superintendent.
Furthermore, the difference between a senior superintendent and a director has
become very small. Everyone has a right to promotion. However, the department
can only promote so many people per annum. The promotion policy of the
department is based on performance – the employee must convince the department
that he/she is actually performing. In the past you were in a rank and then
automatically being promoted.
Furthermore
the department stressed that every one has the right to promotion but this can
only happen within the confines of the budget and therefore it is based on
performance. Those who demonstrate good performance in any acceptable form will
receive additional monetary awards. The department sited the example of photos
that were given to an official to arrest those involved in cash heists; the
official managed to arrest 48 of the 49 suspects appearing on the pictures
without having address or even names - he received the monetary award to
encourage teams to work well.
The
committee enquired why it takes more than one year to obtain a gun licences.
The department responded by stating that gun licences is an issue which are
approach differently by two groups of people. On the one hand, there are those
who ex exert pressure not to issue licences for
various reasons, and on the other hand you have those who apply for gun
licences. In some instances people wait for more than one year to get their gun
licences. The National Police Commissioner promised that if he’d be forwarded
with names, he would investigate why there was a delay. The committee enquired
about the lack of vehicles to respond to crime. The department responded that
they have purchases a new fleet of cars for this purpose.
The
Committee enquired about the maintenance associated with the asset. The
department responded on vehicle maintenance and stated that they spent at least
R 1 billion on fuel per annum, which is related to globalised
market increases. There are certain core aspects pertaining
to work performance which links to over spending funding on vehicle fuel and
oil - the same applies to repairs and maintenance related to market increases.
The department changed the system of procuring for maintenance services by
given selected garages permission to work on a threshold basis for maintenance
and rather than following the tender procedure route which may hamper the
timely maintenance to vehicles.
The
Committee enquired about the building of police stations located close to the
people in the rural areas. The department retorted by stating that they would
like to locate these facilities close to people but that in most instances the
land belongs to the chiefs and the chief decides were the facility would be
located on his land. The process of demarcation of land is also cited as the
problem but they are seriously interested in constructing law enforcement units
within rural areas. The committee cited
that if constraints arise in the construction sector, then the department is
not doing enough to engage the private sector in stating their future needs.
The Department of Justice and Constitutional
Development has history of under spending and has received qualified audits for
the last 4 years. The department has five programmes - namely, Administration,
Court Services, State Legal Services, National Prosecuting Authority and
Auxiliary and Associated Services. A comparison between the first six months of
the current and previous financial years reveals that expenditure in the
Programme: Court Services has increased by about 27%, while expenditure in the
Programme: Administration decreased by 8.3%.
Comparisons
based on the new economic reporting format economic classification, reveals
that expenditure on software and intangible assets increased by 12847. 4%. The
department’s spending patterns are in line with spending for other departments
in the security cluster. At the end of September 2006, the department has spent
38% in terms of current payments. Goods and services which form part of this
category was 33% spend, while compensation of employees was spend at 42%.
Overall, the department has spent 41% of the budget at the end of six months of
the current financial year.
The
Committee guided the department to rather put their weak foot forward whilst
they interacted with the committee. The committee referred the department to
the savings components that they were reflecting which was indeed under
expenditure and not true savings. Both virements and
roll-overs happened during the first six months of the year. The shifting of
unspent funds was used to provide for expenditure for a digital network system
to the amount of R 41.8 million. The digital network system was introduced to
replace the old analogue system in courts. R 35 million was rolled over to
finance x-ray machines and metal detectors at courts, while R 114.8 million was
used to fund digital court recording equipment.
Approximately
R 101 million was shifted from Compensation of Employees and Machinery and
Equipment to Goods and Services. The shifting of funds from Compensation of
Employees to Goods and Services was as a result of the non-filling of posts.
Between programmes, funds were also transferred from Machinery and Equipment to
Buildings and Software. Virements for software were
as a result of the March payment for software licences.
The policy
priorities in the Department are as follows: Expanded Capital Works Programme,
Increasing Capacity and Enhancing Efficiency, SIU and LAB Increasing Capacity,
Statutory Appropriation and Reducing Criminal Case Backlogs. In terms of
capital works, there are currently in hot areas courts with no air
conditioning. Some courts do not have proper functioning facilities. The huge
case backlog also highlighted that there is not enough courtrooms, which
necessitates an increase budget for capital works. According to the
Director-General of the department, two areas have not been budgeted for but
should be regarded as important. These are the Justice Deposit Account System
and the E-Schedule System (all dockets coming into courts will be captured so
if it gets lost, if can still be retrieved).
The
Committee enquired about the reasons for the high expenditure patterns in March
based on there spending trends the peak for the department should really be in
December. The department responded by saying that institution shuts down in
November and December and therefore there is no peak in spending at this time.
The department is involved in the tender process due
to re-prioritisation and this will only be started in the new
year. They went through Treasury through the emergency certificate to
procure the security equipment. Treasury warned that it should not be a norm.
The
Committee expressed that they could appreciate the magnitude of challenges the
department faces but state that at a point of implementation that this was the
responsibility of the department. They enquired that new legislation is in the
offering pertaining to redefining the crimes of rape, how ready is the
department to ensure beneficiaries do not become victims again. The department
responded by stating that when it comes to sexual offences, no secondary
victimisation will happened as they have embarked on an education strategy of
staff in line with the Victims Charter. The department noted that the real
challenges lies with the police in bringing the perpetrators to court in good
time.
The
Committee enquired around staffing capacity and the problems with filling of
vacant posts. The department responded that the Court services brought in
temporary staff to deal with the capacity shortages. They stated that currently
the NPA has been advertising for staff but retention is a huge problem. The
Department of Justice and Constitutional Development has about 16000 employees.
A large chunk of positions are in the below salary 8 level. It is here that
there is a high turnover of staff. With the high turnover come high vacancy
rates that account for the huge under expenditure. The challenge for the
department is always to fill positions.
All people on contract will not be renewed. Posts will be advertised. If
none of people who apply qualify then the contracts will be allowed to run
through. According to the Director-General, the department has never looked at
it from the point of view of its core business. The core business is advisory
services. In light of this, the type of employee should be at a higher level –
more an administration type employee. The minimum qualification in the
department nowadays is a tertiary qualification with two years experience.
Those who are not qualified must be allowed to go through the SETA’s.
The
Committee enquired about the location of courts to allow people easy and close
range access to the court, where people would rather opt not to attend because
it was too far. The department responded by stating that the Magistrate
Commission where looking into the under utilisation of the 500 to 600 courts,
and state that 40 courts carrying load is essentially carry the load of hearing
cases located in urban areas which results in long waiting list for trials to
come to court. The department responded that it has 366 magisterial districts,
which has one court to services 9 0000 people. The department stated an example
of
The
Committee enquired around the management of caseload and the Court Roll. The
department stated that it was dealing with case backlog by re-employing retired
and new staff to attempt to bring trial dates nearer - this will happen next
year. The process will cost about R 60 million to implement.
The
Committee enquired about JDAS and asked if it was provided by CSIR, or a
private provider. The department responded by stating that Microsoft provided
it.
CARA
minister committee, official committee place bids what they need for. Make
recommendation to ministers committee to made to cabinet they decide
Victim,
Rehab etc
The
Committee enquired further around filling of vacant post. The question was
raised whether the plan is to employ the temporary staff on a permanent basis.
The department responded by stating that the staffing of post in high instance
is done with consultants and temporary staff. The biggest challenges they face
was that they never looked at it from the core business, which is advisory
service and how to respond to legislation on the administrative function. The requirement then for the new cadre of
employee is a degree qualification for recruitment purposes. For the currently
employed staff not having the degree qualification is to push them through SETAS
accredited training programmes.
With the
implementation of digital system the Stenographers became redundant since these
people generally held low-level qualification. It is difficult to deploy them –
the department however state that their redundancy is not huge since this
function was usually performed on an hourly basis. Those who are employable are
absorbed into the system and placed at entry levels of clerk positions and put
through learnerships. Employment is dealt with
contractually or through adverts for position.
The
Committee enquired about the huge under spending of last year and that this
repeat pattern would not be good for the department specifically since court
services are the departments focus. The department responded by saying that the
raised questions do not come as a surprise and that they have had repetition of
under expenditure last year (R 1 million), while this year it is estimated at R
500 000 under spending. The Committee enquired about the department’s
involvement in multipurpose centres. The department responded that they would
look into the MPC system.
The
Committee enquires about proactive solutions to the HR problems. The department
also suggested that its problem is an issue of governance and is a systems
problem. They are looking into the short-listing process and will be looking at
outsourcing the HR function to respond to the short-listing exercise.
The department stated office space is an issue because
of the expansion of the HR function to grow the staff establishment. The
department warned that they would have to disappoint the committee with some
under spending due to these constraints. The department also cautioned that due
to the automation on IT system they may need less people so his reluctance to
go and recruit mass new employees may cause more problems than it would assist
at this point. The department also cited that they fronted payments to service
like psychiatric service, which they have to claim back from other departments
may also reflect negatively on their financial management.
The
Committee thanked the department for their fort rightness and assured the
department that the Committee was created to ensure no surprises with the
budget. The committee expressed that it was glad to hear the department was in
the process of working on matters where they were experiencing major issues.
The department was advised to work with the portfolio committee. The department
was also reminded that the committee reviews month spending patters and that
the department would might be called in future to interact with committee.
The
Committee strongly emphasised to the department that they wish to be addressed
by the executive in the personage of the Minister or the Accounting Officer. The
Committee would like to note the changes in schedule was
on the committee’s side and thus would hear the presentation on behalf of the
requisite persons. The committee considered that the replacements were
high ranking accounting chiefs. The Committee strongly reminded the
department that it is normal to send departments back if those who are not
entrusted with financial accountability are not present to account to the
committee.
The Joint
Budget Committee considers on a monthly basis expenditure of departments and
informed the department that it may be called back at any point to account to he Committee. From the on set the department
was cautioned that in the light of its non -attendance to the MTEF hearings
this was not the platform for that accounting. The Committee reminded the
department that what their expectation is that the department speaks to it
strategic plans, objectives achieved and budgets in line with the period spend.
The
Department of Defence has nine programmes. These include Administration,
Landward Defence, Air Defence, Maritime Defence, Military Health Support,
Defence Intelligence, General Support, Force Employment and Special Defence
Account. Only 21% have been spend on “Largest
projects” (that is projects in excess of R 15 million) as part of the
Programme: Special Defence Account for the first six months of the year.
Likewise, only 16% have been spent on Special Projects as part of the
Programme: Special Defence Account. The spending performance for above two
project descriptions is far below the average spending of 33% for the entire
programme.
A comparison between the Total Estimated
Expenditure (2006/07) and the available funds (which include adjustments)
reveal that an over expenditure is expected in all programmes. The GFS
classification in terms of the New Economic Reporting Format reveals that an
over expenditure of almost R 21 million is expected for Compensation of
Employees. A saving is however expected in Goods and Services to the amount of
approximately R 18 million. An analysis of transfers and payments reveal that
although provision was made for transfers to foreign governments and
international organisations, there are no funds available for this purpose,
hence an expected over expenditure in that regard. This over expenditure is
however expected to be offset by a saving in the transfers to Public
corporations and private enterprises of the same amount. Reasons for under
expenditure as shown through the cash flow report are: the under expenditure is
mainly due to the lack of payment of goods and service as a result of: the
protracted procurement processes (tenders), integration of logistics systems,
and industry’s capacity to deliver maintenance and repair services for
B-Vehicles.
The Department of Defence has numerous strategic
plans. One of the key issues in the department is the issue of sustainability
in terms of costing nature of defence. In this regard the department relies
heavily on developments in the defence industry. This reliance on the defence
industry requires that the baseline should be amended so as to make provision
for new developments.
The
Committee enquired about the sale of goods and services - what kinds of
equipment does this refer to. The department responded by stating that it
refers to equipment of
The
Committee enquired as to the process involved with the disposal of assets. The
department responded that the process if fairly standard when comes furniture and office equipment through Auctions. When
it comes to other military equipment Armscor
processes the disposal of aircraft and military vehicles. When it comes to
items purchased from foreign countries they are contractually bound to use
NCACC to approve the sale of disposal assets. It has become necessary for them
to start a Directorate NCACC, and the person started last month to deal
specifically with this issue.
The
Committee stated they were happy to hear that the department could for fulfill its international obligations but enquired how the
UN payments were accounted for and importantly who would be the recipient of
the funds - the Department of Defence or National Treasury. The department
responded and stated that the UN funds the department is supported by
government, the re-imbursement are done to the department, defence is the
collecting agent It is paid over to the national
revenue fund.
The
Committee asked about the status of Military Hospitals. The department
responded that Hospitals are an issue but they are in the process of upgrading
1,2,3 Military Hospitals and is building a sick bay in
Luwantla, and at Tabatswanit
a hospital is being built. The department is going out to tender R 50 million
to spend on upgrading military hospitals. They have to replace metres cabling
in the old hospitals. The final phase of completing the new hospital is scoped
for completion within in an 18-month period. Process of re-cabling will start
in a year time. The department admitted that the condition of facilities is not
good – it must be brought back to back to design functionality. Following the
rules specified that facilities must be used productively the department is in
process with the forum Land Management, which was established in 2005 – this forum
comprises the Departments of Land Affairs, Public Works and Defence.
The Committee enquired why certain facilities were
left in a state of decay. The response from the department is that it is
following the process of handing back buildings to the Department of Public
Works. Commando facilities are probably what the committee is referring to and
this is been handed back to Public Works.
The department stated that property that are handed
back to Public Works still carry the Defence identifiable yellow notices to
create the impression that it is still the property of the Department of
Defence. The department further stated that State assets are been looked after
but financial restriction and capability issues may create an issue.
The
Committee required an explaining relating to maintenance of buildings and
equipment and funds given. The department responded stating that funds given
are productively utilised and spent. The department also stated that they are
not the agents to do the repairs. Public Works do repairs the department
provide the priorities repairs lists for Public Works to execute. The
department expressed that it faced capacity issues in the technological side,
project like the Gua- train is gaining greater
importance over their projects from contractors, they
are also not fulfilling their obligation due to capacity.
The Committee enquired about
preventative measures in the department – whether these preventative plans in
terms of maintenance are in place. The department responded stating that they
do have a proactive programme focussed on preventative maintenance first and
lastly on new facilities development. The have identified mission critical
areas like upgrading of military hospitals and large project like Waterkloof Airbase upgrade since the facility accommodates
the President and other VIPS regularly.
The
Committee asked for an explanation on the item Landward.
The department responded that Landward provide
inventory executed by the service of the national army, specially referring to
sub programmes artillery and infantry.
The Committee enquired about the media reports on
defence issues. The department responded by stating that the media reports the
Minister have been answering the concerns of the people around the peace
keeping mission they have programmes in place.
The
Committee enquired around capacity of the department. The department responded
on how they operate in external operations the department was busy with a
complete transformation aligning capabilities from defensive to supportive.
They were aligning the accounting systems that were manually operated. Defence
generally were not ready for those operations externally through the internally
computerised the system. With a mission like
The Committee enquired about the systems of control in
place for these external missions. The department stated that a Board of
enquiry is used to ensure and to maintain the commanding systems. Command and
Control system protocol in place. The department discovered their weaknesses in
the accounting system and it was an issue. They were not warned beforehand, and ready for
The
Committee enquired further around the media leaks if the system identifies
where it came from or how it was sniffed out. The department responded that it
had not yet confirmed how the press got hold of the whole Board of Enquiry
transcripts but stated that the media made their own interpretations.
The
Committee enquired around the scarcity of technical capacity and what was in place
from the department’s side. The department responded that technical service is
generally a scarce skill and they have programmes in place to reduce the
scarcity but it does have an implication on the budget. Bursaries are also
available in the areas of scarce skills
The
Committee referred to the graphical representation by the department to explain
the 2006/07 cash flow in detail. The Committee noted that it is always best to
show information against a baseline measurement. The department responded by explaining
that the green is drawings, while blue is actual expenditure for the month. The
carry over is not reflected.
The shape of
graph is it normal the major contributors in peaks is related to current
programmes undertaken and should see a decline in future to such a
representation. The department assured the committee that their spend is even
but if a March Boom or Hockey stick seems to appear the department is dependant
on the Department of Foreign Affairs for the Military Officers VIP protection programme
submissions of invoices to pay, they only get this at the end of the financial
year. As a proactive measure the departments are liasing
to improve the system.
The
Committee enquired what the impact of scarce skills losses have on the
department. The department responded that scarce skills are lost like in any
other department who faces the challenges they are unable to compete with large
salaries of private sector. Even thought they are tied in by contracts, private
sector buys out that contract.
The
Committee enquired about how the budgets were used to retain scarce skills. The
department responded that they have incentives schemes for rural areas. Pilots, Technicians, and
the Navy have put in place the incentive to personnel to receive. They realise
incentive scheme’s are not enough, and the environment
they work in plays a huge role. Tertiary institution studies are being paid for
personnel showing an interest in enhancing skills. They are researching with
international institutions to find out how they succeed in retaining staff. The
budget is sighted as a problem that impact on their ability to retain staff.
They are developing the Internship programmes and it will be brought into the
departments to acquire the skills needed. MSD programme.
The
Committee enquired about youth taken into programmes, what are the departments
doing to ensure they contribute to the science and technology shortfalls and
skills. The department responded that the Youth Development Programme is aimed at
taking youth in to improve matric marks relating to
maths and science with the intent of rewriting matric
to get better marks to go tertiary institutions or so that youth could be
absorbed in the MSD programme. The youth are also trained in life skills to go
to university or find jobs in other programmes the reason for this is sited as
the youth coming through this programme is generally disciplined to succeed in
the future thus aligning the departments initiatives to ASGISA
The
Committee enquired about the transfer of funds between departments and the vat
compliance. The department responded that transfer the department complies with
legislation and are in line with them. Vat, Armscor
gets out of their budget, they had to pay more to
retain staff of particular value.
Logistics
agency is responsible for monitoring the systems. They have inspectors to
reviewing that structures are in place and check that they have the logistic
training in place. Also to maintain systems they have internal audits that the
systems are effective.
The
Committee enquired about the Sudan Peace Force and the budget issues and
problems uncounted within the allocation. Te department responded by stating
that the
The
Committee stated that Peace Keeping support operations should ensure that a
system is aligned to the home operation system. The department stated that they
are working on
a system of support. The department
indicated that their operation are guided by the UN doctrine, by South African
rule an operation is needs to be supported by a squad, UN only requires one
person this may affect the accounting system which may not be aligned to the
domestic system. They will have losses but they are attempting to control
losses and hopefully will be linked to a computerise system.
The
Committee enquired about the qualified audited reports the departments have
been receiving and if this will change in future. The department responded to
the audit questions by meeting the SPDs – Coverts
brings in new technology which they class as a quantum leap but it brings new
challenges implies more navigation time; more training time; fuel cost are
more. When they speak about sustainability the cost increase in operating the
new systems of modernisation
The
Committee enquired if internal audit systems are working. The department
responded to internal audit and stated that it is working – they will qualify
their work, they could not take internal audit since they were auditing on
different system. They are reporting to the audit committee on a quarterly
basis. The report in turn is given to a monthly budget committee. Last week
they has a meeting they looked at internal audits they were engaged working
paper of internal audits they think they can change their opinion they would do
assessment at the end of the year. Their internal audit does not audit the
financial statement.
Training
company at a cost of R70 000 to train internal staff to come up to speed with
the process. Have a committee consisting of internal and
external personnel for objectivity.
The
Committee enquired
They have
received unqualified audits for the past five year. They stated that they will
not received an unqualified audit report in 2007. Very
little the department can do with qualifications IFMS Treasury stated that the
system will be provide and t hat departments should not be spending on an
accounting system They can clear what they can but treasury state that the new
system will come into play in 2015.
Relationship
How do they
spend their money – Capital Expenditure programme 72 million was spent in order
of priority on capital project they spent more due to the nature of built
environment they normally over plan that money is spent on priorities.
Thei year they have 74 million. The have two projects
which lie with Public Works and it is too late in the year to strategy on these
project. They think they may have a slight roll over which will be spent the
following year.
Development
of funds, they received a 1 billion which was spilt to accommodation public
works are charging at a nominal rate so that can maintain own facilities.
Leases this have been devolved so that they can the leases themselves.
Municipal Service . They hope to receive an equitable
return but public works are not in a position to answer they decide on who get
what so they are not assured of money they normally get 80 million on
devolvement. They are custodians so they have the liability. They are in
process of working with the department of ensure that their priorities are
taken into consideration.
Hand
buildings back procedure they notify them in time. The Army has complied a list by physical handover of facilities they need
to provide their own security guards. ICT they have addressed partly, they are
not running the PERSL in logistic they are running three systems ARMY, NAVY,
DEFENCE it was based on cash accounting. Government is on accrual accounting
system. They would go over through a model system in logistics to learn lessons
for the change of the other systems. Migration system PFMA, Electronic
Maintenance, Effective cooperate system is a bigger plan for systems overall. Project are
underway
The
Committee enquired about the protracted procurement process and what caused
this. The department responded to the
procurement system and stated that it is a difficult one, they share it with
logistically with another departments and the issues are
approval at different levels. Recording suppliers on a database they are still
developing the procurement system.
The committee enquired about the exact budget
allocation for the Sudan Peacekeeping mission. The department stated that the
The
Committee enquired if there was a further increase. The department replied
that
If you had
deployment of 10 years you can see a 40% under estimations this makes your
budget untenable. You have to go to planning to address the matter. The
political level gives instructions and this is a challenge, which cannot be
budgeted for. Doctrines used different and thus the single biggest challenges.
The
Committee enquired on how complete the departments Asset register is. The
department responded that the Asset register is a major challenge and deals
with the reconciling of the 10 or more systems. It is not reconciled with what
is used on the ground. They are in the process of ensuring a more accurate
register which is a huge challenge. When transformation took place it was a big
department they have started these processes only recently. They hope to have
it 90 –95% correct, and are in process of increasing the accuracy.
The
Committee enquired as to where the MSD can apply for access which important for
constituency purposes. The department replied that they should apply directly
to recruitment centre in
Closing
remarks by the committee were that clarity must be provided on issues the
department is not clear on. The Committee assured the department that they will
keep an eye on the budget and that the line is closed if they were to ask for
more funds.