SA Roadies Association on settlement agreement & challenges; Committee Report on Arts and Culture Budget

Meeting report

Consideration of Budget Vote Report
The Committee was told that the Department’s expenditure stood at 67% at the end of the third quarter. This was worrying, because it meant the DAC was either under-spending or dabbling in fiscal dumping. Many issues were still outstanding, such as critical vacancies, including the Director General’s post, which had not been filled for quite some time. One of the big issues was oversight, as the monitoring and evaluation department was under-resourced. Some institutions were still historically disadvantaged in terms of funding, compared to others. There had been a decrease in the travel and subsistence budget allocation over the past few years, but there was a slight increase over the medium term expenditure framework (MTEF) period.

The recommendations had been linked to the recurring issues on funding, such as the appointment of a Director General (DG) and the need for the Department to ensure that the Pan South African Language Board (PanSALB) tabled its 2015-2020 strategic plan. It was also urged to strive to spend 100% of its 2016/2017 budget allocation.

The Chairperson emphasized that this report was only a draft and Members could make changes to this report where things did not add up. Looking at the budget, one found that it was not sufficient for the Department to do what it had to do.

Dr P Mulder (FF+) commented that the issues went beyond medium term solutions and reliance on the strategic plan, and said the Committee needed to identify all the issues.

The Chairperson agreed with Dr Mulder, and asked that the Committee look at finding solutions that involved a holistic approach to issues.

Mr J Mahlangu (ANC) said he was trying to understand the findings, which referred to “non-compliance with the National Treasury”. He knew that there had been a decrease in the expenditure since the Committee last dealt with it. If there had been a decrease in 2014/2015, he did not know why it would be brought up in the 2016/2017 plan. He asked for the Committee’s opinion on the “Engelbrecht issue.”

The Chairperson said issues which were not responded to by the Department would be on the Committee’s radar screen until it responded, so that the issues could be put to rest.

Department’s response
The Department said the wording on the decrease in expenditure was confusing, but it had been important to highlight that for the Department, the overall expenditure had decreased. It would work on the wording and also include figures to clarify what it was trying to say.

The Chairperson said the Committee needed to alert the National Assembly that it needed more time, as it would not be able to visit all its entities and interact with them.

Within PanSALB, the Department accepted the recommendations, and was working on addressing the issues.

Mr V Mogotsi (ANC) moved the adoption of the report, and Ms S Tsoleli (ANC) seconded.

The Chairperson: At all times, it was not about us, it was about the artists and the institutions to ensure that the Department was achieving its goals. The committee needs to do their jobs and I appreciate the manner in which we were doing our jobs.

DAC and South African Roadies Association (SARA) on settlement agreement
Mr Freddie Nyathela, President, SARA, said at the outset that this was a small matter that should never have lasted as long as it had. There had been systemic failures from the DAC, the Public Protector and the Portfolio Committee on Arts and Culture, but these failures could be resolved, as would be outlined in the conclusion of the presentation.

From 2005 up until 2 February 2016, SARA had been given promises that had not been met by the DAC and the Public Protector.

The objectives of the agreement settlement were:

• To put the complaint lodged by SARA to rest and amicably resolve all issues attendant thereto.
• To implement the DAC commitments to SARA made variously.
• For the Deputy Public Protector to have oversight in respect of monitoring the progress of the objectives and outcomes of the agreement, and accordingly to put in place an appropriate monitoring mechanism.
• To ensure the DAC operates in strict accordance with the Batho Pele principles in all its dealings with SARA, and that the relationship between the DAC and SARA was compliant in respect of the Promotion of Administrative Justice Act (PAJA).
• DAC committed to respond to SARA’s proposals within 30 days of receipt of such proposals.

SARA had met, adhered to and complied with all its obligations, but then the DAC and the Public Protector had failed dismally to comply with their obligations. This was why SARA was at the meeting today. A report had been provided on all the communications between SARA, the DAC and the Public Protector, and the Committee was asked to refer to them.

In the settlement agreement, there were two proposals, and the DAC had failed to honour its obligations. What the Department had done was to take the international projects out of the other projects and had funded only this one. Regarding the renovation project, it had been agreed that the Department would appoint the Independent Development Trust (IDT) to do a report, and immediately the IDT and other bodies would do renovations to the SARA house. This had not happened. It had been sent from “pillar to post”. The DAC had been urging SARA to accept R10 million for renovations and SARA had been refusing because it was not in line with the settlement agreement. The Department had been wanting to work outside of the agreement. It had increased the amount to R15 million, but this was still not enough to cover operational costs and other expenses. The only support that SARA had been receiving from the DAC had been for international projects.

The Chairperson said that the government did not pay for operational costs. The Department worked within a framework and if they went outside it, then the Committee’s duty was to ask it why it was doing so. It was not the Department’s mandate to be involved in infrastructure, as that was the responsibility of the Department of Public Works.

Ms Monica Newton, Deputy Director-General, DAC, responded on the details of the agreement, as contained in section 4. Some of components were related to substance. Wording was very important, as the Department had said “it would consider”, and this was not a guarantee of funding.

On 1 April 2014, two proposals had been put forward -- a building renovation proposal amounting to R39 million, and a funding proposal amounting to R17 million. SARA and the DAC had different understandings of the proposal agreements, and the wording perhaps needed to be rephrased. The DAC had revised its decision to provide complete funding and had offered R10 million. SARA’s view had been that the IDT should compensate this on behalf of SARA. The complexities of this agreement presented problems. If the DAC renovated a building which was not its own, then who was responsible? With this view the Department had revised the budget to R15 million, with a provision that SARA would appoint professionals who would run this project.

The DAC was aware that SARA had approached the Arts Foundation for funding, but was not aware of the details. It had asked for information about SARA’s other sources, but this information had not been provided. The DAC had continued to engage with SARA on various levels and had supported subsequent applications from SARA.

The DAC had had challenges in maintaining the harmonious relationship with SARA. As the Deputy Public Protector had pointed out, relationships should remain civil and harmonious between SARA and the DAC.  The Department had indicated to Sara that it would like to see this project finalised within the current financial year.  One of the challenges had been the submission of an implementation plan, because the DAC could not do this for SARA. The solution would be to work together with SARA.

The DAC had appointed a project manager and had confirmed in writing yet again its intention to support the renovation project. Its understanding was that SARA would appoint qualified contractors to do the work. While there had been challenges, the DAC’s view was that it was operating according to the settlement agreement. It felt like it was making progress and would like to continue to work with SARA.

Discussion
Ms S Tsoleli (ANC) said it was very important that the Committee addressed the issue where SARA felt it had failed. How had it failed SARA when this was the first time that it was meeting SARA as a Committee?  Looking at the agreement, both parties have agreed that it was the issue of renovations and operational costs that had not been implemented. She did not get a sense of where the problem was when looking at the agreement, because the DAC had made a commitment by giving R10 million, and had said that it would not deal with renovations because it was not its responsibility. What was the problem with the R10 million being given to SARA by the DAC to do the renovations -- why had it not accepted this?

Mr T Makondo (ANC) asked what the items under operations were that did not include salaries. He understood that the IDT had said the building had gone beyond its life span, so what had informed the DAC against the advice of the IDT to put aside R10 million to be invested in something that had gone beyond its life span? On the obligations of the parties as outlined, there was an assertion that the two parties involved must try by all means to harmonise their relations and ensure that in their interactions, they were civil. Sitting from here, it had been difficult to listen to the tone and language that he had heard, and he thought it went against the obligations set out in their meeting. He doubted whether if there was any respect between the parties, and whether the Committee could expect this agreement to be finalised. What could the problem for SARA be if the R15 million was transferred to them and they implemented the renovations by themselves?

Mr Makondo said it was a problem that the Committee had been referred to as a “failure” in terms of how it conducted its oversight. The Committee had a constitutional responsibility to make sure that when the Department was implementing its plans, it was done according to the law. He wanted to put it to the DAC that it had the responsibility to assist different organisations with training, and he would have a serious problem if a proposal for training had been submitted and the Department was not assisting, because that was against the law.

Dr Mulder asked whether all the parties involved were present at the meeting on 4 April.

Mr Mahlangu said he had not yet established what Mr Nyathela wanted the Committee to do. What does he want it to help him with?

Mr Nyathela said SARA wanted the DAC to comply with the settlement agreement and not impose conditions or want to change the agreement.

Mr Mahlangu continued that there was no way this Committee would be party to breaking the law. Its responsibilities were governed within the constitution and the rule of law.

Response by SARA
Mr Nyathela said he would first like to apologise for his tone during the presentation. It was not his intention to disrespect anybody or to undermine Members of the Committee. SARA had arrived at the conclusion that the Committee had failed it because it had been meeting with the DAC, and SARA had had access to all the minutes of those meetings. SARA had been sending communications about the DAC and complaining, but nothing had been happening, which was how it had arrived at that conclusion.

The Chairperson replied that SARA was not a public entity. The Committee performed an oversight role over the DAC when it implemented its own objectives. The Committee did not control its mandate. She asked SARA not to ridicule the Portfolio Committee because it was doing its work to the best of its ability.

Mr Nyathela acknowledged this, and retracted his point on the “failure” of the Committee.

He said the issue of the renovations and operations had not started recently. These commitments had been made as far back as 2006. The Public Protector had found that the DAC would not be able to conduct renovations but would be able to assist. On the issue of the R10 million, when it had first come up, it was not about giving it to SARA -- it was about giving it to SARA so that it could move out of its building in Newtown and find accommodation elsewhere. It was agreed that the DAC would appoint the IDT to do the assessment and the Department would submit a project implementation plan and then, through the IDT and other relevant bodies, the renovation would take place.

Operational costs included expenses such as salaries, telephones, stationery, etc.

He said SARA would welcome becoming a public entity, because it had been created for the youth of this country, if that meant the Committee would be holding it accountable and providing funds instead of the DAC.

Response by DAC
The DAC responded on a point of clarity, that it had received a report at the time that there had been considerations about whether the building would be approved. The City of Johannesburg had not shut the building down or anything. The recommendation had been that investing a lot of money in the building was not conducive. The assessment was then that if work could be done to make the building safe and usable to operate in, then that was where the R15 million would come in.

There were issues in the building that needed to be dealt with and therefore the DAC acknowledged the need to renovate.  In the case of public entities, it worked through the Department of Public Works to do the work. With non-state entities, it gave the entity money and it appointed a suitable contractor.  As a Department, it supported operational expenses up to a maximum of 10%.

The Chairperson asked what the DAC’s policy said about renovations.

The DAC said the policy created a hierarchy of needs which it considered through an external infrastructure committee, which sees the full picture of needs.

The Chairperson asked what the problem was now that made it unable to implement the agreement.

The DAC said the issue was the argument as to who would do the work. The point of view from SARA was that they would like the DAC to appoint the IDT to do the work, whereas the DAC was of the view that it should give SARA the money and they should implement the renovations themselves. It was not the Department’s mandate to oversee renovations of non-state entities.

The Chairperson asked Mr Nyathela what SARA’s issue was regarding the matter of facilitation with the DAC.

Mr Nyathela said that just as the DAC had pointed out that it was not in the area of renovations, the same applied to SARA. Both were in the field of skills innovation. In the settlement agreement, it had clearly been stated that the IDT and other bodies should oversee the renovations -- and then, all of a sudden, they were not complying.

Ms Tsoleli said the Committee was not going to break the law. Its role was to uphold the constitution and make sure the law was followed to the letter. What was the problem with SARA accepting the R10 million? SARA could not expect the DAC to implement on its behalf when it had been the party to request the assistance.

Mr Makondo asked what the implications were of appointing SARA staff to assist a private organisation to implement the building renovations. The Committee could not assist Mr Nyathela to push the Department to comply with the settlement agreement, because in its view it was against the law. The Department could not assist with the building or renovation of a building for a private entity.

Ms N Bilankulu (ANC) said that after listening to Mr Nyathela, she wondered if there was someone from SARA who could present on his behalf. It seemed to her that Mr Nyathela was using what had been said in meetings to insist that the Committee tell the Department what to do.

Mr Nyathela said that since the very beginning, it had always been about the youth. The building or equipment was not registered in the name of “Freddie Nyathela,” but under the “SARA Trust”.

Dr Mulder said that governments changed and budget cuts also happened. While fighting this issue, SARA might lose everything. He advised that in some cases one needed to compromise in order to achieve a goal.

Mr M Rabotapi (DA) asked on what basis the Department had agreed to fund this agreement.

The Chairperson thanked the Members for such an engaging discussion. She went on to reiterate what Dr Mulder had said about making compromises in order to achieve goals -- even if it was not all of them, at least it was better than nothing. She urged the DAC and SARA to find a middle path and cooperate with one another, and also to respect each other.

Approval of minutes
The Committee considered the minutes of April 12 2016. Mr Mahlangu proposed their adoption, and Mr Rabotapi seconded. The minutes were adopted.

The minutes of 19 April were considered. Dr P Mulder (FF+) moved their adoption and Ms S Tsoleli (ANC) seconded. The minutes were adopted.

The meeting was adjourned.