The
Budgetary Review and Recommendation Report of the Portfolio Committee on Sport
and Recreation, on the performance of the Department of Sport and Recreation
for the 2011/2012 financial year, dated 25 October 2012
The Portfolio Committee on Sport and Recreation,
having assessed the performance of the Department of Sport and Recreation,
reports as follows:
1. INTRODUCTION
1.1 The role and mandate of the Portfolio
Committee
·
Consider legislation referred to
it
·
Exercise oversight over the
Department of Sport and Recreation and its statutory bodies, namely Boxing
South Africa and South African Institute for Drug Free Sport
·
Consider International Agreements
referred to it
·
Consider the budget vote of the
Department of Sport and Recreation
·
Facilitate public participation in
its processes
·
Consider all matters referred to
it in terms of legislation, the Rules of Parliament or resolutions of the House
In terms of the Constitution of the
Furthermore, Section 5 of the Money
Bills Amendment Procedures and Related Matters Act, No 9 of 2009 (the Act)
provides that the National Assembly, through its committees, must annually
assess the performance of each national department and submit Budgetary Review
and Recommendations reports for tabling in the National Assembly. The Committee
on Appropriations should consider these when it is considering and reporting on
the Medium Term Budget Policy Statement (MTBPS) to the House.
1.2
The role and mandate of the
Department
The Department of Sport and Recreation is the primary government
institution that is responsible for formulating and implementing policy on
sport and recreation. It reports to and advises the Minister who, in
conjunction with the Cabinet, takes final responsibility for government policy.
The Department is headed by the Director-General, who is responsible for
ensuring that sport contributes towards the maximising access to sport and
recreation and encouraging world-class performances that improves social
cohesion and nation-building.
1.3
Process/ method followed by the
Committee in writing the BRR Report
For the period under review, the Portfolio Committee
on Sport and Recreation, in exercising its oversight role, had interacted with
the Department of Sport and Recreation and analyzed its 2011-2015 Strategic
Plan, the 2011/12 Annual Report, the Auditor-General (AG) Report, the State of
the Nation (SONA) address and the 2011/12 Estimates of the National
Expenditure.
2. STRATEGIC
PRIORITIES AND MEASURABLE OBJECTIVES OF THE DEPARTMENT OF SPORT AND RECREATION
2.1 Strategic Priorities of the Department
The Department’s
Strategic Plan seeks to deliver results along five strategic objectives that
include promoting initiatives that increase the number of participants in sport
and recreation, providing assistance to South African sports people to become
winners in international and continental sports competitions, raising the
profile of sports and recreation through transformation of the sport and
recreation sector, and strengthening the operations and management of the
Department.
The following
strategic focus areas are critical to the success of the Department:
- To contribute to a healthy nation by increasing the number
participants in sport and recreation and the development of talent within
an integrated development continuum.
- To assist South African sports people to become winners on and off
the field
- To raise the profile of sport and recreation through addressing
issues in National Sports Plan
- To streamline the delivery of sport by means of the effective
support systems and adequate resources
- To contribute to making the School Sport the bedrock of our sport
development
2.2 Measurable
Objectives of the Department:
2.2.1 Mass
Participation Programme
Sport and Recreation South
Africa (SRSA) should continue to pursue initiatives that increase the number of
participants in sport and recreation. The Department has to broaden its focus
to the area of recreation and strengthen its relationship with the Department
of Basic Education in the delivery of school-sports programmes. The Department
intends to increase the mass participation base through effective sports
promotion programmes and intensive media campaigns.
2.2.2 Sport Development
The Department intends to focus on facilitating the transition from
mass-based programmes to high-performance programmes through coordinating and
monitoring the important areas of talent identification and development as well
as the delivery of scientific support to national development athletes.
Furthermore, the Department intends to roll out a national Sport Facilities
Plan. The Sports Facilities Plan would enable the Department to monitor the use
of facilities and ensure proper maintenance thereof.
2.2.3 High Performance
The Department intends to improve working relations with its key
strategic partner in nourishing talent in high-performance sport in our
country. Therefore, South African Sport Confederation and Olympic Committee
comes the relevant strategic partner of the Department since its mandate is to
deliver in the focus area of high-performance sport. The Department intends to
improve our country’s international ranking through adequate scientific support
to our athletes.
In general, the Department realised that the above strategic focus areas
needed to be supported by strong regulatory frameworks, adequate financial
resources, reliable sports information and functional sports academies. The
Department will continue to work closely with departments such as Basic
Education, Tourism and Health in order to further the spirit of co-operative
governance. In addition, the Department intends to intensify its coordination
efforts of the 2013 government guarantees to ensure the hosting of a successful
2013 African Nations Cup. The Department further intends to finalise the work
of the Transformation Commission on Sport and Recreation that will set the tone
for transformation, based on sport development in our country.
3. ANALYSIS OF PROGRAMME PERFORMANCE
The activities of the Department were organized under
the following Programmes:
3.1 Programme 1: Administration
Corporate
Services: This Unit dealt with human resources and outlined the Department’s
Human Resources strategy. This strategy included a clear retention strategy
although the Annual Report (hereafter, the Report) failed to indicate the
skills retained. The Department had set a target of 2 per cent for the
employment of people with disabilities. Therefore, the Department had exceeded
its own target in employment equity. The current rate of vacancies as reflected
in the Report had been due to integration of staff from the Sports Commission
and the Department had approximately 37 vacancies in the current financial
year. This integration has improved the vacancy rate in the Department. The Department outlined that the Audit Unit
was not fully staffed and that slowed down performance. Notwithstanding the
above, the Department has not yet met all the employment equity targets as
prescribed by the Department of Public Service and Administration (DPSA). The
Human Resources Unit had put in place a performance management system and was
constantly monitoring it. The employees of the Department were each entitled to
36 days leave per annum. In addition, employees were entitled to 36 days sick
leave per annum. In addition, the performance systems and individual agreements
were not concluded since negotiations were continuing with the relevant
parties. The Department was currently developing a succession plan. There were
three vacant posts within the Senior Management Services (SMS) of which one
must be a woman in accordance with DPSA equity targets.
3.2 Programme 2: Sport Support Service
This programme
comprises of four sub programmes; namely, Sport and Recreation Service
Providers, Club Development, Education and Training, and Scientific Support. It
comprises an integrative financial support service that is specifically for
Boxing South Africa (BSA) and SAIDS. Only four of 61 National
Federations received financial support.
The reason for this variance was that some National Federation grants were
withheld because they did not meet the deadlines and requirements for funding.
The
Department reviewed its overtime policy since it was an operational requirement
that officials work during weekends. Therefore, officials were
no longer rewarded for working in the field or weekends. One hundred and eighty
nine capacity building training sessions (target
met) were provided to the clubs and sports equipment was provided to 41 clubs in our communities.
3.3 Programme 3: Mass Participation Programme
The purpose of this
programme is to increase the number of participants in sport and recreation
with special emphasis on disadvantaged and marginalised groups. The programme
also transfers conditional grants to provinces to promote mass participation in
communities and schools. Achievements for the current year include among others
the following:
- 9 104 people trained as coaches,
administrators and facilities managers
- 2 013 hubs, schools and clubs had
received sports equipment
- Over 28 008 people participated in sport
promotion projects
- Over 1 600 school athletes would participate in
this year’s School Olympic Tournament
3.4 Programme 4: International
Liaison and Events
The purpose of this programme is to coordinate
all international and intra-governmental relations and support the hosting of
identified major events. The Department hosted a
successful 123rd International Olympic Committee Session
from 7 to 12 July 2011 in
Following the success of the first phase of the
Youth Development through Football (YDF), the German government extended its
support by another 18 months making a further contribution of Euro 1, 6
million. The second phase will build on the achievements gained during the
initial phase, specifically, focusing on consolidation and sustainable
integration into the national structures and programmes.
The measurable objectives were to assist
national federations and other stakeholders in promoting
Nineteen major international events received
intra-governmental support per year against the targeted 15 because
3.5 Programme 5: Facilities
Coordination
The purpose of this programme is to coordinate
the provision and management of sustainable sport and recreation infrastructure
by municipalities. In addition, it oversees the procurement of gymnasium
equipment to certain municipalities as part of the Government’s drive towards
speedy delivery of sports services. A database was developed and updated
subsequent to the completion of an audit of provincial facilities. One hundred
and sixty three municipalities have been lobbied to build sports facilities,
utilizing the Municipal Infrastructure Grant.
The measurable objectives were to contribute
towards skills development of facilities managers. The greater percentage of
the allocated budget for this programme is used for the compensation of
employees and the purchasing of equipment. FifteenYouth Development against Violence through Sport
(YDVS) facility projects were implemented (target met).
The
2010 FIFA World Cup Country Report
has been finalized. The report is a collation of evidence gathered from
commissioned and empirical research, and from the findings contained in
stakeholder reports. It also provided the country with the socio-economic
benefits generated from hosting the 2010 FIFA World Cup. This Country Report
would later be tabled before the Committee for its consideration.
4. The Analysis of Departmental Grants and Expenditure Trends
4.1 Analysis
of Expenditure Trends
During the period under review, the Department under-spent on its
allocated budget by less than 1 per cent on average. In
4.2 Conditional
Grant Expenditure
The Department administers the Mass Sport and Recreation Participation
Programme Grant, which is aimed at facilitating
mass participation within communities and schools through selected activities,
and the empowerment of communities and schools in conjunction with relevant
stakeholders. The monetary value of the grant allocations and expenditure has
increased gradually over time; however, the total grant allocation has never
been fully expensed. The expenditure rate of this grant for the period 2006/07
to 2010/11 averages at around 93.3 per cent (Figure 1).
Figure 1: Sport and
Recreation Conditional Grant Expenditure Trends for the period 2006/07 to
2010/11
Source: National Treasury (2006/07-2010/11)
The Annual Report[1]
of the Department is not easily accessible as the reporting format presents the
performance information in a fragmented manner and therefore an assessment of
performance outcomes against the targets cannot be concluded. Notwithstanding
the limitations of the Annual Report, some performance information is reported
in the Division of Revenue Bill [B4-2012]. In 2010/11, the grant funding
provided for the training of 3 298 people in sport and development compared to
14 679 people in 2009/10; 45 mass mobilisation campaigns were held, the same
number as in 2009/10; and 5.1 million people participated in the programme via
schools and community clubs compared to the 4.5 million people that
participated in 2009/10.
According to the Annual Report, challenges at the provincial level
include: underage participants; the non-arrival of transport requested to
transport participants; and purchase orders of sporting gear being placed late
thus affecting some deliveries. At the national level, challenges with the
co-ordination and implementation of the programme is primarily attributed to
delays in provinces confirming their accommodation and last minute withdrawals;
prolonged memorandum of understanding (MOU) discussions between the Department
and provinces; and the SRSA not attending the majority of the plenary meetings.[2]
4.2.1 Irregular,
fruitless, wasteful and unauthorised expenditure
The Department incurred irregular expenditure amounting to R49.2
million, unauthorised expenditure amounting to R1.5 million; as well as
fruitless and wasteful expenditure amounting to R7.2 million. Table 1 below
succinctly demonstrates the pattern of irregular, fruitless, wasteful and
unauthorised expenditure from 2006/07 to 2010/11.
Table 1: Irregular, fruitless, wasteful and
unauthorised expenditure for the
period 2006/07 to 2010/11
|
Year
Incurred |
Irregular
Expenditure |
Fruitless
and wasteful expenditure |
Unauthorised
Expenditure |
|
2006/07 |
R0 |
R2 000 |
R833 000 |
|
2007/08 |
R8 937 000 |
R0 |
R675 000 |
|
2008/09 |
R34 861 000 |
R4 979 000 |
R30 000 |
|
2009/10 |
R2 964 000 |
R2 176 000 |
R0 |
|
2010/11 |
R2 513 501 |
R0 |
R0 |
Source:
Auditor-General (2006/07-2010/11)
Crucially important is to note the seismic shifts in the Department’s
expenditure trends from 2008/09, with future projections up to 2014/15 included
in the following sections.
4.3 Administration
Expenditure grew from R74.1 million in 2008/09 to R108.8 million in
2011/12 due to the filling of posts in the Office of the Chief Financial
Officer and Corporate Services sub-programmes. Expenditure on compensation of
employees also increased from R37.3 million in 2008/09 to R56.1 million in
2011/12. Over the medium term, expenditure is expected to grow to R131.8
million in 2014/15, which is due to increased municipal and office
accommodation charges. Expenditure for consultants has declined but is expected
to increase over the medium term due to the need for legal services. Of the 35
vacancies in the Department, 28 were in the Administration programme. The
objective of this programme is to provide overall and centralised support
services. This means that administering, guiding and managing Sport and
Recreation is the core business of this programme. The utilization of
technology to capture South African athletes in one database is an important
aspect and should reside in this programme, as it could also lead to job
creation.
4.4 Sport support services
This is one of the key programmes of the Department with a focus on
increasing participation through providing financial support, strengthening
high-performance sport, promoting sport at a community level and empowering
sport human resources through the training of coaches, administrators and
technical officials. Key sub-programmes include Programme management, Sport and
recreation service providers, Club development, Education, and Scientific
support. The budget for this programme is expected to increase from R162
million in 2011/12 to R228.3 million in 2014/15 due to additional allocations
to BSA and the increased number of sports federations supported from 61 in
2011/12 to 70 in 2014/15. In preparation for the 2012 Olympics and the
Paralympics, expenditure for the Scientific sub-programme will increase.
Support for sporting bodies also increases during this period. The programme
makes transfers to Lovelife, the South African Sports Confederation &
Olympic Committee, Boxing South Africa and the South African Institute for Drug
Free Sport. Expenditure for consultants increased during this period in
preparation for the 2012 Olympics. It is suggested that the Committee enquires
about the tangible impact of these increases.
4.5. Mass participation
The Mass Participation
programme is the largest programme of the Department and promotes the
sustainable participation of people previously excluded, strengthening of
school sport through the training of coaches, developing school sports by
monitoring service level agreements with federations and the identification of
talent. Key sub-programmes include Programme management, Community Mass
Participation and School Sport. The Community Mass Participation sub-programme
is the largest component of this programme and is expected to increase over the
medium term. Participants in SRSA events increased from 12 165 participants in
2009/10 to 28 000 in 2011/12. The budget for this programme increases from
R500.8 million in 2011/12 to R584.3 million in 2014/15. The Community Mass
participation sub-programme is expected to increase from R472 million in
2011/12 to R537 million in 2014/15. The School Sport sub-programme is expected
to increase from R27.3 million to R44.5 million over the medium term. Mass
participation is a programme that is meant to promote programmes by focusing on
increasing number of participants in sport and recreation. It is crucial to
note that the results and impact of this programme are not clearly visible.
4.6 International liaison and events
This programme manages international exchange programmes, supports
travel arrangements for sports people, and encourages the staging of major
sports events in
4.7 Facilities coordination
This programme established a sports geographical information system and
lobbied municipalities to build sports facilities. It facilitates the provision
of multipurpose sports facilities, builds upon the legacy of the 2010 FIFA
World Cup, and provides technical assistance for sport infrastructure and the
training of facility managers to ensure the proper maintenance of sports
facilities. The two sub-programmes include Planning & advocacy and
Technical support. The programme is also involved in overseeing the donor funds
received from the German Development Bank, Kreditanstalt fur Wiederaufbau (KfW),
for developing infrastructure associated with the Youth Development against
Violence through Sport Project. This programme was responsible for purchasing
mobile gyms for designated municipalities. Over the medium term, this programme
increases from R8.7 million in 2011/12 to R9.5 million in 2014/15. Over the
medium term, expenditure on contractors is expected to increase from R712 000
in 2011/12 to R5.2 million in 2014/15 for the development and maintenance of a
sports facilities database using the geographical information system that will
inform the national facilities plan. At the local level, the Municipal
Infrastructural Grant (MIG) and Urban Settlement Development Grant (USDG) are
grants that the majority of the people are not aware of, these grants are
specifically meant to build sport and recreation facilities and this is
sometimes used on programmes that are far from Sport and Recreation
essentialities.
5. ANALYSIS OF ANNUAL REPORT AND AUDITED FINANCIAL STATEMENTS
5.1
Statement of Financial Performance
The total revenue of the department amounted to R4.9 billion comprising
the R4.7 annual appropriation and the R217.1 million departmental revenue.
The total expenditure amounted to R4.5 billion comprising R673 million
total current expenditure; R3.8 billion total transfers and subsidies; and
R48.7 million total expenditure for capital assets. The surplus for the year
amounted to R348.6 million.
5.2 Analysis of Auditor-General Opinion for
the 2011/12 Financial Year
For the financial year under review, the Department received an
unqualified audit report. The reasons cited for the unqualified audit report
were that the Accounting Officer ensured that full and proper records of the
receivables for the departmental revenue was kept as per prescribed norms and
standards.
The audit report also pointed to irregular expenditure of R38. 4
million, which was incurred by not adhering to the internal
delegation of authority and tender processes. These were picked up by the
internal controls established by the Department and all cases were evaluated
and condoned by the Accounting Officer during the year. An amount of R2. 2
million was incurred as fruitless and wasteful expenditure due to double hotel
bookings and payments for venues that were not used.
6. Report
OF the Committee on Public Accounts
Because the Department had received an unqualified
audit, it was yet to meet with the Committee on Public Accounts, wherein,
recommendations by the Committee will be made. That meeting is yet to take
place.
7. PERSPECTIVES
OF THE COMMITTEE ON THE QUARTERLY EXPENDITURE REPORTS
7.1 To date, the Committee’s
method of work does not include quarterly evaluation of Departmental spending
and performance. This part of the report is based, therefore, on expenditure
information supplied by National Treasury.
7.2 Notwithstanding
the above, both the Committee and the Department recognised the urgent need for
regular interactions and quarterly reporting in order to ensure accountability
and improve effective service delivery.
8. Observations
- The overall
expenditure of Programme 3: Mass Participation grew substantially from
2006/07 to the 2010/11 financial year. Notwithstanding this growth in
overall expenditure, there is no reliable evidence that leagues and clubs
were established in communities.
- The
Committee noted that the Department had withheld transferring conditional
grants to provinces until such provinces had submitted their business
plans on implementation of the mass participation programme.
- The
Committee was concerned that even though the Department approved an
additional grant to BSA, its liabilities continued to exceed its assets.
- The
Committee expressed concern over the performance of the Chief Financial
Officer duties by a financial consultant at BSA.
- The
Committee commended the efforts of the Minister of Sport and Recreation in
establishing the Transformation Commission with the aim of facilitating
the broader transformation agenda for sport in our country.
9. Recommendations
For the 2011/12 financial year, the Department had been
allocated R820,880, million
and based on the Department’s strategic focus on the School Sport Programme,
allocations for the MTEF period will be dramatically reduced from the 2010/11
financial year and beyond. The implication is that those financially struggling
Federations will have to work hard to sustain themselves financially through
attracting private sponsorships.
Based on the analysis of the Department’s budget for
the year under review (2011/2012), the Committee recommends that the Minister
for Sport and Recreation should ensure that:
- The Department
strengthens its Information Technology Strategy to improve the capturing
and collation of data within the Department.
- Additional
funding is allocated to sport support services to enable it to provide
funding to Federations and agencies with a good track record of improving
sports facilities and distributing sports equipment to disadvantaged and
rural communities.
- Additional
funding is allocated to BSA to fill all key vacant strategic positions to
ensure that governance issues raised by the Auditor-General were
effectively dealt with by the Board and Management.
- The
Department moves swiftly with initiatives to amend the South African
Boxing Act as well as the South African Institute for Drug Free Sport Act.
- Leadership
within the public entities under SRSA should be strengthened to achieve
good corporate governance in sport.
10. Conclusion
The Committee was fairly satisfied with the service
delivery performance of the Department. However, the Committee would like to
urge the Director-General to adequately address the recurring matters of
emphasis reported by the A-G that range from internal control, irregular
expenditure, unauthorised expenditure,
insufficient visits to hubs and supply chain management to mass
participation. The Department has after many years received an unqualified
audit report with no matters of emphasis from the A-G. The Committee held the
view that the resources of the Department are utilised efficiently with the
view to achieving the targets set out in its Strategic Plan.
Report
to be considered