Vessels patrolling from Simonstown: DAFF, DEA, DWA, and the Navy on latest developments; fishing rights: DAFF briefing – discussion postponed

Meeting report

Chairperson’s opening remarks
The Chairperson expressed his disappointment at Mr L van Dalen (DA)'s behavior during the oversight visit to Simonstown. He accused him of exposing the Government on areas of security relating to vessels and ships.

South African Navy Status of DAFF/SA Navy Partnership Presentation
Rear Admiral Bernhard Teuteberg, Chief Director: Maritime Strategy, briefed the Committee on the status of DAFF/SA Navy partnership and provided an insight into the status of DAFF vessels being operated by the SA Navy. The SA Navy was currently managing the DAFF vessels and the contract would come to an end in March 2013. The Navy would like to continue this role. Overall, eight vessels had been transferred over to the Navy. A memorandum of understanding (MOU) governed the function of the SA Navy in managing the shipping functions for an initial period of 12 months, subject to the Defence Act (No. 42 of 2002). The arrangement stipulated monthly reimbursement of all costs associated with shipping management functions. The vessels would need to be handed over or before 31 March 2012. A comprehensive audit would need to be conducted on each vessel by an accredited third party and an service level agreement (SLA) would then be signed. The Shipping Management Functions included crewing (manning) of the vessels (not specialised staff; e.g. scientists, fishing inspectors etc); technical management of the of the vessels, which included maintenance, repair and life-cycle management; provisioning of the vessels; operation of the vessels; and accounting of all aspects relating to the functions. The amount the SA Navy had spent from the months of April to September ranged from R104 045.62 to R5 707 947. However, the Navy was reimbursed only the full amount expended in April, R22 039 for an amount of R1 753 383 expenditure in June, and R4 177 616 of an expenditure amount of R5 707 947 in July. No reimbursements were made for the months of May, August and September, which had expenditure amounts of R1 861 689.29; R4 774 947 and R1 953 131 respectively.

Adm Teuteberg focused on the condition of the South African Ship (SAS) Africana, a research vessel that had 30 service by 2012. He presented a graph showing the cost analysis of keeping it going. He emphasised that the longer the Department kept the vessel going, the more costs it would incur due to the high maintenance work required. He estimated that at it current state, it could last at maximum another five years. He recommended that the Government needed to accept the important role the vessel played and should make a decision to replace her within five years. He also recommended to commence a project study immediately with associated costing; to allow the SA Navy to conduct a proper refit to extend her life by five years and if necessary to lease a suitable vessel to conduct surveys in the meantime. Finally he emphasised that ownership of the vessel needed to be confirmed. The impact of the current events on fisheries could only be provided by DAFF.

The SA Navy would not be able to comment on the contracting of any entity within the private industry to conduct the shipping management function. The SA Navy believed that it could conduct the shipping management function for vessels belonging to Government and that it could create a permanent home and management responsibility for vessels and not just operating them.

On a strategic level, the recent joint meeting between DAFF and the SA Navy was extremely positive. There were some teething problems but some of the misunderstandings have been resolved. An action list had been compiled and was being addressed. The Navy had contact with the Department at all levels and the venture would work only if the partnership was conducted as an equal partnership. In terms of lessons learned, he said that only one command and control system should be used; the DAFF vessels could become a specific squadron within the SA Navy and  bring in benefits like enabling experiential learning for younger Navy members, making the Navy Dockyard more effective and efficient, integrating repair and maintenance,  and bringing vessels under configuration control.

South African Navy Status of DAFF Vessels presentation
Rear Admiral Bubele Mhlana, Director: Fleet Force Preparation, briefed the Committee about the state of the five DAFF Vessels. The SAS Africana had undergone extensive repairs but still had several operational defects. The SAS Africana had an extremely busy schedule and was presently in her third survey; the pelagic survey due for completion on 14 December 2012. The West Coast demersal scalefish survey was due to commence on 8 Jan 2013 and would be completed just prior to a scheduled Scientific Charter which would span the period of 05 to 26 February 2013. The SAS Sarah Baartman was scheduled to be docked in mid December for her Lloyd's of London class inspection. Class inspections were mandatory and due dates for them were promulgated by the classification authority. Extensive maintenance for such inspections as dictated by Lloyd's necessitated a maintenance period and the vessel was in such a period. The SAS Ellen Khuzwayo was also undergoing engine overhauls as scheduled maintenance and regulated by the number of hours the engines had to run. The overhauls were completed on 05 November 12 and harbour trials started on 06 November 2012. The vessel would commence readiness inspections on completion of maintenance work. The SAS Lillian Ngoyi was about to have a W6 level service. Her engines had reached nine thousand hours service and would have to be completely overhauled. This meant that the engines would have to be removed form the ship. That was work that would be undertaken by the original ship builders and manufacturers of the engines. She should be ready by January 2013. The SAS Ruth First was busy with a South Coast Patrol which would end on 09 November 2012. The vessel would then refuel and take provision for patrols as required by DAFF to continue throughout leave periods. The SAS Victoria Mxenge was on a west coast patrol and had been recalled to conduct the Lloyd's survey. She would be docking on 08 November 2012.

Department of Environmental Affairs (DEA) presentation
Mr Andre Share, DEA Chief Director: Marine Resource Management, gave a very brief presentation about the state of the Algoa, the DEA research vessel. The RV Algoa was managed by an existing management agency which was also managing the SAS Agulhas II. The vessel was only transferred to the DEA after a Ministerial decision was made for its transfer and effected on 12 September. At the moment, the vessel was in dry dock in East London - and the process was nearing completion. The vessel was normally used for research purposes to understand ocean processes relating to the physics, chemistry and biology; deploy and service a system of observational platforms (buoys) around the SA coast; gather climate change data on a long time scale; long term monitoring of environmental parameters; conduct systematic surveys on marine biodiversity; conduct research on marine top predators as indicators of ecosystem functioning and change; understanding interaction between ocean and atmosphere.

DAFF Fisheries Branch report: status of the DAFF fleet of fisheries protection and research vessels presentation
Working arrangements
Mr Sipho Ntombela, DAFF Acting Director-General, confirmed that there were teething problems in the working arrangements with the SA Navy but the parties had managed to resolve them. The meetings held so far between the Department and the Navy were at the top level and the parties agreed that they would cooperate and would look at it as a partnership between the two Departments and would view vessels as Government property. The Department appreciated what the Navy was doing. He also confirmed that the presentation the Department of Environment had made was a true reflection of what had happened.

Research vessels
Dr Johann Augustyn, DAFF DDG: Fisheries, presented the Department's perspective on the status of the vessels. The Department had three research vessels. The FRS Africana (78m) was a multipurpose , deep sea vessel, used to survey the area of distribution of several major fish stocks, including hake, horse mackerel, king lip, monk, sole, squid  and other demersal species as well as small pelagic species such as anchovy, sardines and round-herring. The FRV Ellen Kuzwayo (45m) was a coastal multipurpose research vessel, used to survey West and South Coast rock lobster, line fish, sharks and large pelagic stocks and collect relevant environmental and biological data, using a variety of methods including trap-fishing and long lining. (See slides 36, 38-39)

Patrol vessels
SAS Sarah Baartman was an offshore patrol vessel deployed to protect South Africa's deep sea boundaries against illegal fishing by foreign vessels through inspections, and, if necessary, high speed chase and arrests. The three inshore patrol vessels (Victoria Mxenge, Ruth First, and Lilian Ngoyi) protected coastal resources from illegal fishing through deployment of smaller boats, inspections and, if necessary, high speed chase and arrest. The tender for new management of vessels was withdrawn in March 2012. On 22 March 2012, the DAFF and SA Navy met to discuss the Navy's taking over the management of vessel related functions including research and compliance for a one year period. The DAFF fleet hence came under the Defence Act 2002. On 28 March 2012, the DAFF fleet was transferred to Simonstown and was handed over to the SA Navy on 31 March 2012. The MOU governing the arrangement between DAFF and the SA Navy was signed on 31 March 2012 between the Minister of Defence and Military Veterans and the Minister of Agriculture, Forestry and Fisheries. There was an initial delay of approximately six months while the SA Navy trained staff and attended to various technical issues on the vessels. (See slides 36, 38-39).

Surveys
During the period, an important pelagic fish recruitment survey was completed and some patrols were carried out by the SA Navy. Two important surveys were missed, namely, the  demersal surveys on the South Coast. This would affect the accuracy of research surveys but would not affect the setting of the Total Allowable Catch (TACs). A new assessment of horse mackerel stocks was missed and would have to be postponed for a year. It would not affect the current assessment of horse mackerel. The FRS Africana carried out a pelagic spawner biomass survey critical for setting the anchovy and sardine TACs in October 2012. Another survey would be carried out for the hake and other demersal fish. The SA Navy would deploy the FRS Ellen Khuzwayo once all crew had been appointed and trained. The FRS Algoa had been transferred to the Department of Environmental Affairs (DEA) to support its functions. The Ruth First and the Victoria Mxenge had been deployed.

Patrols
The FPV Sarah Baartman had an engine software problem and was also due for a scheduled dry docking in November 2012 and would be ready to sail in January 2013. Although there had been a delay in getting the patrol vessels to sea, DAFF had focused its efforts on the monitoring of landing sites and through deployment of its small craft along the coast.

Cooperation
The Department aimed to continue regular meetings at senior official and technical levels between the SA Navy and the Department. Communication channels had been agreed upon to address issues requiring immediate attention. DAFF was awaiting a plan of action from SA Navy to keep the DAFF fleet in class. This was agreed to in order to ensure that the vessels could be smoothly re-transferred to a new management service provider. DAFF intended to outsource the management of the vessels by the end of March 2013 when the MOU with SA Navy would expire. A new tender process for the vessel management of the DAFF Fleet was underway.

Discussion
The Chairperson asked about the deadlines.

Rear Admiral Teuteberg said that the Navy had tried to complete the training and repairs by October this year. Most of the emergency ones had been done.

Rear Admiral Mhlana said that all the vessels maintenance was nearly completed. The Ruth First Vessel was scheduled to undergo classification and the Ellen Khuzwayo had nearly completed its maintenance by early November.

Ms N Phaliso (ANC) wished the Management and Crew of Africana well for a job well done. She remarked that the equipment was getting old and it was costing a lot of money. She was also concerned about the fact that the vessels in SA shores were foreign owned as there was significant impact on fisheries, and communities depending on fishing.

Mr Van Dalen said that he believed the Navy was put under undue pressure in relation to a recent disaster and it was doing the best they could. He was not convinced that research and patrolling went well together. He asked the Department why it had employed an allegedly corrupt company to manage the Government fleet. He also told the Department of Environment that he was not happy with its presentation as it was very thin and that it needed to give more details. Patrol vessels were part of the ecological disaster response fleet. He asked if ships could be deployed to ecological disasters on short notice.

The Department indicated that they could not comment on the status of the company mentioned in Mr Van Dalen's comments.

Ms A Steyn (DA) pointed out that the initial meeting with the Department was on 30 August 2011 and asked why the Department had waited so long to act on it and had put the Navy under an unreasonable time frame to comply with this. She asked if the Department was sure that the Africana would be back at sea on Thursday as it would affect the investigations or studies being done.

Rear Admiral Teuteberg clarified that the first meeting between the SA Navy and DAFF was on 31 August 2011.

Ms Steyn said that the mackerel season was missed and asked the Department of Environment what that meant. She was concerned that the Department was missing important deadlines. She was concerned the there was no urgency from the Departments in trying to solve issues. The MOU would expire on 31 March 2013 and she was wondering if there were discussions, and plans on the table. She asked the Departments again if there was any sense of urgency in the matter as it was the people's livelihoods that were at stake. She wanted the Departments to understand that it was people's lives and their livelihoods that they were dealing with and that there needed to be a great sense of urgency on the things needed to be done.

Dr Augustyn explained that, in relation to the missing deadlines on fish stocks, there was movement in that area as the fish were always there; hence the timing was not critical. What the vessels did was to cover the area of distribution. The Department was still within time.

Mr S Abram (ANC) told the SA Navy that it was impeccable. He was happy that the Navy did not leave anything to chance and he wanted to tell its members that he was extremely proud of them. He referred to a point in the presentation where it said no contact had been made since August 2011. He asked why this was as it was now 15 months later and the Departments needed to explain why an important issue like that had been left with no contact between the parties involved.

Mr Abram, referring to slide 10, emphasised that the Department had received a service from the Navy and that the Navy had to be paid. He also pointed to the future plans of the DAFF that there would be meetings between senior officials at technical levels. He asked why such would be future plans and not something that was happening in the present.

Mr Abram asked DAFF on what grounds was the decision based to outsource the management of the vessels by March 2013, especially because when the DAFF was in trouble it ran to the SA Navy to help it with the vessels. He asked the Department why the SA Navy could not carry out that function and to give reasons why DAFF had to outsource the management of the vessels. It was important for the Government to do the vessels maintenance in house. South Africa was not at war, therefore the Navy could take on the function of maintaining the vessels.

Mr L Gaehler (UDM) pointed out that when the Committee visited the vessels they were in a very bad state but reminded the Committee that it needed to remember that the Navy prepared the vessels for war. He also did not see why the Navy could not continue with the management of the fleet and why the management had to be outsourced. The Navy needed to continue with the work as it was contributing to creating the skills needed by the Government.

Mr Gaehler asked what the plan was for replacing the Africana as it was costly to maintain it.

Mr B Bhanga (COPE) agreed with the two Members above and said that the country was not at war, hence the Navy should continue what it was doing in maintaining the vessels. He asked if the age of the vessels affected the output of research, and if the reason for outsourcing had something to do with it.

He asked DAFF what the plan was for paying the money it owed to the SA Navy. He was worried that the Departments seemed so comfortable and there were vessels that needed to be fixed to protect the nation, and they were not operating as frequently as they should be. He asked why the Departments implied that there was no crisis, as it seemed like there was one. There had been complaints about the Africana for years, but to no avail, as there was no long term plan for what SA wanted to achieve. SA was not in control of its waters as foreign vessels were exploiting its resources.

Mr Mtoba said that in terms of quality research and cost and value for money, the Department did not have a choice in how the surveys were conducted. With aging vessels, the Department incurred more costs but the quality of research was second to none. The Department needed to bring down the cost of doing research.

Ms M Pilusa-Mosoane (ANC) supported her colleagues who said that the operation and maintenance of the vessels needed to be given to the SA Navy. She also asked DAFF about its long term plan for the vessels.

Ms Steyn asked about the operational cost of the fleet. She noted that the biggest amount been paid to the SA Navy was R6 million in July and that the cost of the contract that was cancelled was R800 million.

Ms Phaliso said that fisheries were a historically neglected industry. The DEA was supposed to explain the transfer of fisheries to DAFF and say what was transferred but it had said nothing. The building of vessels was something that could be done in South Africa in order to keep the skills in the country.

The DEA responded that the Algoa was transferred from DAFF to DEA and joined the SA Agulhas, and was being managed by the same agency. The brief from the Committee was to report on the status of the Algoa.  The DEA had indicated that the vessel was in dry dock but would be re-launched in the next two weeks, then the DEA would bring a report on its situation. It was the reason for a very small presentation as the DEA did not have a lot of information to give to the Committee.

The fisheries functions transferred from the DEA to DAFF were in terms of the Presidential Proclamation, transferring responsibility for certain sections of the Marine Living Resources Act (No. 18 of 1998) (MLRA) to DAFF. Those sections were available in terms of that proclamation.

The Chairperson referred to the Service Level Agreement (SLA) and asked if there could be any recourse to Smit Amandla as there was a vessel that had been seriously ruined and costs had been incurred by the SA Navy. Such costs needed to be passed on to somebody.

Rear Admiral Teuteberg thanked the Members for their honest feedback and said that he had to clear up some misunderstandings.

There had been several meetings with DAFF and he had attended all. He also said that the SA Marine Safety Authority (SAMSA) had never contacted the Navy about the Navy's oil spill equipment and, if it did, the Navy would have happily shown the equipment to SAMSA. He had been in the SA Navy for 39 years and would never send a ship to sea in which he himself would not sail. He was confident that the SA Navy would not compromise standards in safety. They had numerous publications on equipment and vessels and their maintenance. For the DAFF vessels, the Navy was drawing up the minimum sea level requirement for every single DAFF vessel and ensuring they complied with all the naval standards. He emphasised that he would never send out the men and women of the Navy into danger.

Even though the Navy was not engaged in war duties, it was working, together with Tanzania and Mozambique, on keeping the Northern Mozambique Channel clear of piracy. A person was recently killed in an anti-piracy operation. The Navy was deployed there to make sure the seas were clear.

The Navy was investigating the problem of the water in the fuel tanks. The  system had already been flushed out. The vessel would be back at the sea later in the week.

Rear Admiral Teuteberg was concerned about the date of 31March 2013 as the SA Navy wanted to carry on doing work for the vessels of DAFF in terms of the class plan. The SA Navy was the first navy in the world to place vessels under classification society rules and was well versed with the procedures. It understood that keeping vessels in class was important but it was not possible to present vessels about which one was not happy before inspectors. He had given the DAFF (Dr Augustyn) half the plan for taking the vessels into class.

Ships in Government service were a long standing issue as SA still did not have a maritime policy and perhaps it was time for that, followed by a strategy to deal with protecting resources from pollution and misuse.

Mr Ntombela said that the Department appreciated what the Navy was doing. The standards were very high and the work was different from commercial fishing. This was one of the reasons for the delay in vessels going out as the Navy had to satisfy itself that the maintenance level was up to standard. The Admiral had indicated that the vessels had to be classified as defence vessels before they could set sail.

Mr Ntombela said that the allegation that there was a corrupt company was unfortunate. At no stage did the Department say that a company was corrupt.

Mr Van Dalen interjected that the Department had indicated that a company was corrupt.

Mr Ntombela said that the Department was in agreement with the DEA that it would not comment on the case. It was unfortunate that it came out in the presentation,  as the Minister had not yet made a decision on whether the management of the vessels would be outsourced or not. 

Mr Ntombela agreed with Adm Teuteberg that there had been a misunderstanding on the financial status. He appealed to the Committee to trust the Department. It was working on the issues but was getting the sense that it was not trusted. It was a complicated issue.

He added that he was in agreement with the Members and their preference not to outsource but to allow the Navy to operate and maintain the DAFF fleet. He would communicate such a view to the Minister.

Dr Augustyn said that the SLA with Smit Amandla was similar to one the SA Navy had  with the Department, although it was a complete package. The difference was that DAFF had oversight on the ships while the agent managed them. DAFF had to sign off on invoices before they were paid. The commercial survey was part of the stock assessment model and delays would affect the accuracy of the model but would not result in decline of the TAC.

The horse mackerel was not a set TAC as the Department did not have the resources to survey the mackerel over a long period of time. It had been using data from commercial surveys but did not have accurate measures. The horse mackerel occupied the top and the bottom of the ocean. The budget the Department had did not allow it to do an additional survey and it was missed this year but it would do it next year. In terms of patrol, a period was missed.

Dr Augustyn said that the replacement plan for the Africana had been discussed in the past two to three years. A request had been submitted to National Treasury for R800 million to replace it, but the request had not been successful yet. The Committee had heard that the next five years would be the limit and he hoped that the attention given to the vessel in the presentations would help push the Department's case to Treasury. A standby vessel was needed in case the Africana failed.

Mr Mtoba said that the other area that needed to be dealt with was the safety of the coastline and it was  a serious concern. There were patrol vessels and there was a small craft doing the work, but it was not enough to do the patrolling. This was one area, the Department felt, would make a good collaboration with the SA Navy and other law enforcement bodies and it would benefit the country. Dealing with the problems of patrolling required a multidisciplinary approach.

Mr Gaehler said that he was not happy with the answers given by the Departments. He asked the Department to give details of the SLA with the previous service provider, and if there were conditions in that SLA. He asked in what condition the vessels should be brought back to the Department. If such conditions were not provided in the SLA; why not?

Mr Gaehler said that when the Committee visited the vessels in Simonstown, it found that the SA Navy had given DAFF an office which it did not occupy. He asked why.

He said to the DEA that he was from a small place where local fishermen were very poor and had been given problems by DAFF and DEA. They did not receive licenses to fish. What was the problem?

Mr Abram said that the Departments had not given the problems raised by the Committee the responses deserved. He said to Mr Ntombela that it was not about trust in the Department but it was about the information placed before the Committee by the Department.

Mr Abram also pointed out that the matters brought up by the Committee were based on the information provided by the Department in its presentation. The DAFF was awaiting a plan from the Navy to keep fleet in class (Slide 43, bullet 2).  Outsourcing of the management of the vessels had also been mentioned. Mr Abram raised his voice when he stated that the Department must not present one thing in writing and say another.

He thanked the Navy for its attitude that it would not allow anyone to go to sea in a vessel that was not safe. This was a good principle. If the Navy was saying that it did not have all the staff required, it was easy to get the staff. If R800 million was going to be paid in a tender, then less would be paid to the Navy for the management of the fleet. He also thanked Mr Mtoba for acknowledging that there was room for working together. The Department had to get its ducks in a row and make up its mind on what was good for the country.

Mr Van Dalen wanted to know what the Acting DDG was communicating to the Minister as she had issued a statement that the SLA with the service provider was questionable.

Ms Steyn told Dr Augustyn that she was concerned about what would happen if the vessel was not able to sail in two weeks. She fully trusted the Navy but she wanted to ask if there was a vessel on stand-by.

Mr Bhanga said that it was most important that people understood that it was the bread basket of the country that was being discussed. The Department had raised many questions in its dealings and the alleged corruption investigations that had been undertaken. He also supported the idea of giving the management of the DAFF fleet to the Navy. He asked the Department to ensure that the Committee would be fully  involved in making the decision

Ms Pilusa-Mosoane was not happy with the DEA. The nature of their presentation meant that it was not taking the Committee seriously, and it was not really saying much about the vessels.

The Chairperson said that the SLA question related to contractual agreements entered between DAFF and Smit Amandla in 2005 and that, after five years, it would be renewed year upon year. He asked what Smit Amandla's responsibility was to the vessels. The Committee had seen the state of the vessels with Members' own eyes.

Ms Steyn asked about the implications for the Navy which had the function of patrolling and policing. When the Army was sent to Marikana, the President had to sign some documents to allow the Army to proceed. She asked if this would be the case with the Navy as well.

Mr Ntombela said that this was why the DAFF apologised to the Committee for what had appeared on the screen, because it was not correct, as a a decision had not yet been made.

DAFF - 2013 Fishing Rights Allocation Process presentation
The Department made a brief presentation on fishing rights. It covered the legislative background, policy considerations, processes to be undertaken, rights allocation  process, proposed road map, and Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis (see slides 3-13). It then reviewed the small-scale fisheries implementation plan process and road-map, noting the objectives of the small-scale fisheries policy, the objectives of the policy's implementation plan, achievements to date, implementation framework, road map, action plan, and policy decisions to be taken (see slides 14-23). It then reviewed the progress on the stock recovery strategy for hake, abalone, west coast rock lobster, and south coast rock lobster, with particular reference to fluctuations in catches (see slides 24-34).

The Committee postponed the discussion until the following week.

The meeting was adjourned.