Intelligence Services Amendment Bill & National Strategic Intelligence Amendment Bill: deliberations

Meeting report

The Chairperson noted the apologies of those not able to attend. He noted the Committee should be cautious about their questioning, as some questions should not be asked in this forum.

Costing of stand alone National Communications Centre (NCC)
Mr Loyiso Japhta, Executive Director: National Communications Centre, expressed his willingness to give financial details such as figures for salaries to the Committee in a closed session.

He noted that the Committee had asked that the National Communications Centre give some idea as to the costing on the Bill before it. He explained that currently the National Communications Centre (NCC) was a spending agent for the National Intelligence Agency (NIA). This meant that the Director-General of NIA was the accounting officer, and that a chief financial officer, and an audit committee was currently provided via NIA. In the light of the forthcoming changes there were resources allocated in terms of the medium term expenditure framework (MTEF) allocation and human resources already within the NCC. There was already infrastructure, and technical equipment and buildings in place. The financial implications were to do with personnel. The Head of the NCC would become the accounting officer, and that would mean the NCC would have to produce its own Annual Report. Currently the Head of the NCC was at the level of a Deputy Director-General.  It was anticipated that the Head of the NCC would be appointed at the level of a Director-General. It would be imperative, given the provisions of the Public Finance Management Act (PFMA), that the NCC must have its own chief financial officer (CFO). The current incumbent in charge of finance was appointed at a level lower than a CFO. In addition an audit committee would be required. There would be no financial implications in terms of infrastructure and buildings to establish the NCC as a stand-alone department. The NCC was confident that the financial implications would be included in their allocated budget. It was unlikely that they would request additional funding from the fiscus.

The Chairperson asked what extra amount of staff would be employed. Furthermore he asked if there were any more buildings envisaged.

Mr Japhta replied that the NCC was in the process of looking at new buildings, but that this would have happened regardless of the legislation, so any additional buildings would not necessarily be additional finances resultant on that legislation. The current old buildings needed to be refurbished. The NCC would need a chief information officer and staff for support of that office, but he was not completely sure of how many people. He added that there were some difficulties with the building the NCC were occupying, but the Committee could be assured that the proper measures were in place to avoid problems.

Mr M Damane, Head of Department: Finance: NCC, agreed that there would be no added financial implications as a result of the legislation around the NCC and reiterated that part of the expenditure for personnel and infrastructure was already in the baseline allocation. An average of twenty-five people were hired per annum. The NCC was currently running two projects that were also part of the baseline allocation. They were all funded projects.

Adv P Swart (DA) thought that it should be understood that the Committee needed a final figure of what the implementation of the Bill would cost, as it needed to appear at the bottom of the Bill. The Committee did not need to know the details of how much the salaries would be. He also understood that this had nothing to do with normal expansion and normal budgets. At the moment there was an approved budget based on the NCC as it stood. The money that they were allocated would not come about if they were a stand-alone department. The Committee basically needed to know the costing of turning the NCC into a department.

Mr D Bloem (ANC) disagreed. He had not seen a figure at the bottom of any Bill, but he felt that the Bill needed to be far more specific in how much it would actually cost to put the changes in place.

Mr Japhta replied that he had a document with all the precise figures and hoped that the Joint Standing Committee on Intelligence (JSCI) would consider it. He hoped that it would remain confidential.

The Chairperson agreed that he should give the document to the Chairperson of the JSCI, and that the JSCI would consider how much of the information could be revealed in an open meeting.

Dr S Cwele (ANC) asked about the shared services between the intelligence services, how much was applicable to the NCC, and if they envisaged that this arrangement continue. He added that the problem the Committee had was that they were aware that previously another Committee had passed legislation with similar indications, but had not been able to implement it because of the budget. He wanted to ensure that if this Committee were to pass the legislation, there would be budget and capacity.

Mr Japhta replied that the process of how they would migrate the NCC to a stand-alone department had already started. The underlying principle had been presented to the Minister and was approved. Shared services should underpin the migration from a spending agent of NIA to a stand-alone organisation. There were working groups that considered what functions would be given to the shared services and there was a desire to minimise costs. The preparatory work with NIA, Department of Public Service and Administration (DPSA) and National Treasury would develop a plan to implement whatever the lawmakers decided. If the NCC became a stand-alone department, they would be ready to implement immediately.

Mr S Abram (ANC) asked if the NCC presented a plan for the future, and he noted the objective of the Bill. He also noted that it was stated that all government departments were consulted, and he felt that it was too broad. The Committee needed to know if the expenditure envisaged could be justified. There was also the issue of unintended consequences. There were buildings and construction that was in progress. There had been problems in the past with sister agencies, such as the South African Secret Service (SASS) building. All these things had to be taken into account.

Mr Japhta replied that the Bill was presented to all the departments in the security cluster. The NCC was already operational and therefore already meeting its objectives, but what they required was a legal and policy framework. The NCC would consider further whether there were likely to be any unintended consequences.

National Strategic Intelligence Amendment Bill [B38 - 2008]: Proposed Amendments
The Committee went through the amendments that had been tabled.
 
Amendment of Section 6, Clause 5
Mr L Landers (ANC) noted a slight discrepancy in the new clause under the heading “Reporting”. He suggested that it read “The Inspector-General of the Intelligence contemplated in section 7 of the Intelligence Services Oversight Act, 1994 (Act No. 40 of 1994), shall report annually to Parliament on the activities of the NCC, and in such report indicate any contraventions by the NCC of this Act and the provisions of the Regulation of Interception of Communications and Provision of Communication-related Information Act, 2002 (Act No. 70 of 2002)” (RICA)

Ms Kerenesa Millard, Head of Legal Services: Ministry of Intelligence,  replied that if any official contravened RICA then the provisions of that Act would be brought into play, so it was not necessary to mention it here.  It was contemplated that there would be regulations that would set out how the NCC would conduct its activities.

Mr Japhta added that if a similar contravention occurred in respect of activities conducted by the NCC as in respect of activities covered by the RICA, then there should be parities allowing for similar sanctions.

Dr Cwele did not understand why it was made a stand-alone function considering that the Inspector-General had a review function.

Ms Millard replied that the reporting regarding the Inspector-General was a recommendation that came from Cabinet, to the effect that it should be made clear that there were assurances provided. Once the NCC was established as an intelligence structure, then automatically the oversight of the Inspector-General and the JCSI would apply. The amendments in the schedule brought into play the oversight of the NCC by the Inspector-General.

Adv Swart thought that the Committee should either restructure Clause 5(d), or leave it as it is and create another offence with a suitable penalty.

The Chairperson noted his comment, and asked that the drafters take a look at that clause.

Mr Bloem asked if the clause, instead of reading “report to Parliament” should not say “report to the JSCI”.

The Chairperson noted that if the NCC became stand alone then all the proper oversight bodies would be instituted, and regardless of what the legislation said they would have to report as did all other intelligence agencies.

Mr Landers felt that the offences and penalties should be considered and it should be decided whether these should be consistent with the RICA.

The Chairperson noted the reason for Mr Landers’ view but said there were no similarities to the RICA.

Amendment of Section 2, Clause 2
Dr Cwele asked if the only objectives were listed in 2(b).

Mr Japhta replied that perhaps that the objectives of the NCC should not be reflected in the legislation.

Dr Cwele clarified that it wanted to know if the list was exhaustive. He found incomplete and vague things to be problematic.

The Chairperson noted that the issue was raised at previous meetings.

Ms D Smuts (DA) thought that an agency such as the NCC could not be allowed to collect signals without set parameters. There should be a limitation.

Adv Swart noted that the objectives set out were broad. They stated all the security issues. There was the issue of “advance” as written in 2(b)(ii). However, he queried where the balance was between advancing and security.  There were many countries in the world that used such agencies to advance their economical well-being. The reality was that South Africa had to be a player in the global economy, and consideration had to be given whether they were infringing upon the rights of people living either in the country or outside.

Dr Cwele asked which service providers were being referred to, and why should this be relevant to the Bill. Furthermore he asked what was the intention of 2(h).

Mr Japhta asked that discussion on 2(f) and (g) be done in a closed session, because these spoke to the core of the NCC’s activities. In regard to clause 2(h), he noted that there was a need to analyse patterns and trends.

The Chairperson agreed and realised that this needed to be understood before they passed the Bill.

Amendment of Section 2A, Clause 3
Dr Cwele wanted to know what “vetting field work units” were.

Ms Millard replied that it was the name given by Cabinet to the committees that would be established to assist NIA with security clearances.

Adv Swart asked if clause 3(d) was revised with the intention to delegate to lower levels of security clearances.

Ms Millard replied that the intention was not to delegate to lower levels. During the discussion there had been consideration given to whether the Committee would be satisfied with “any suitable official”. She pointed out that there was a clause in the Bill allowing the Director-General to delegate.

Mr Bloem asked that a rank should be stipulated.

Dr Cwele asked what was the motivation for this delegation, and asked that, if there was a need to delegate,  then the delegation should be to a high ranking official.

Ms Millard replied that the Director-General would make the final decisions as to the official to whom delegations would be made. The vetting field units could not use RICA because they had no authority.

Mr Japhta added he would be interested in having a discussion around the vetting field units with NIA.

The Chairperson noted that there was a need to deal with security clearances.

Mr Abrams noted that responsibilities should be clearly stated because these could be abused and cause major damage.

Adv Swart asked if there were any procedure in court regarding the appeal of the security clearance decisions. He added that the Committee should look at the provisions for RICA.

Proposed Amendments to the Intelligence Services Amendment Bill [B37 - 2008]
Schedule, Part A
Adv Swart noted that in the column named ‘Extent of amendment”, there was a reference to the “Office”, and asked if it stipulate which office.

Ms Lufundo stated that it was already defined.

Amendment to Section 12, Clause 9
Adv Swart noted that the issue regarding the PFMA needed to be discussed.

Ms Millard replied that the insertion into the Bill was intended to cater for the situation where the existing PFMA might be amended.

Adv Swart asked whether, if the PFMA was repealed, this would suffice for what was required, and if not then suggested that this section should be left to read “with the concurrence of the Minister of Finance”.

Mr Landers noted that the Minister of Finance had the authority to supply guarantees, indemnities and securities. 

Dr Cwele wanted to know why this was being re-stated.

Mr Landers noted that he would find it problematic that property was bought without guarantees, indemnities and securities.

Adv Frank Jenkins, Parliamentary Legal Adviser, commented that the new PFMA had been circulated for comment. If the amendment was followed, this would create an exceptional circumstance pertaining to the Intelligence community.

Ms Millard replied that there was no intention to create a special circumstance for Intelligence. She added that the recommendation came from National Treasury during their process of consultation. Section 70 of the PFMA was similar to what was being stated in the body of the Clause and National Treasury said that it would be better to include it in terms so that there was not a need for further amendment if the PFMA was to be changed.

The Chairperson posed the question to the Committee whether they should bring in National Treasury to discuss this issue.
 
Adv Swart did not think so. He said that eventually, when a new PFMA clause came into effect, it may be different, but he felt that the Committee should retain what was in this Clause.

The Chairperson suggested that the drafters take a look and decide if there should be a presentation, and they should consult with National Treasury.

Oversight Visit to India
The Chairperson informed the Committee that the oversight visit was to be postponed, due to some misunderstandings in the translation of the correspondence.

The meeting was adjourned.