DEFF; SANParks; SANBI; Isimangaliso Wetland Park Authority & MLRF 2020/21 Quarter 2 and 3 performance, with Minister & Deputy Minister

Meeting report

Opening Remarks

The Committee elected Mr P Modise (ANC) to act as a Chairperson, because the Chairperson was running late.

Mr D Bryant (DA) moved the adoption of the agenda. Mr N Singh (IFP) seconded.

Apologies were received from Ms S Mbatha (ANC), Ms T Mchunu (ANC) and Ms C Phillips (DA).
Mr N Singh asked to be excused at 10 am due to load-shedding.

Ms Barbara Creecy, Minister of Environment, Forestry and Fisheries, asked to be excused at 11 am to attend another meeting. The Minister asked the Deputy Minister, Ms Maggie Sotyu, to oversee the meeting.

The acting Chairperson asked if there were matters arising from the minutes of the previous meeting.

Mr Bryant asked for a timeframe for the detailed answers from the previous meeting’s questions. He wondered if it would be possible to look at the draft of the last meeting’s minutes.

The Secretariat of the Committee said that today’s briefing would be included in the report, and the draft would be available next week. The draft would then be adopted at the first meeting in May, when the Committee comes back from recess.

Ms T Tongwane (ANC) moved the adoption of the minutes. Mr Bryant seconded.

Oversight visit to KwaZulu-Natal

The acting Chairperson asked for consideration and adoption of the report on the oversight visit to KwaZulu-Natal (KZN).

Mr N Paulsen (EFF) said that the report of the oversight visit to KZN did not address the responses to Members’ previously raised concerns.

Mr Bryant raised a concern regarding the visit to Engen. He said that a bus tour replaced the foot/walking tour, which had prevented the Committee Members from being closer to the facilities for observation.

Ms Phillips was concerned about item 5.2.3 in the report, and asked what the Committee would do about the communities’ concerns.

The acting Chairperson asked for the date in 5.2.1.7 in the report to be changed from 3 December to 4 December. He agreed with Mr Paulsen, Mr Bryant and Ms Philips on their concerns regarding issues raised by the communities, and by the Committee about Engen. He said that the community had asked them to respond in 14 working days, but they had told them that the government did not work like that. They had promised the community that they would revert through mail or any other necessary means of communication.

The Committee Content Adviser said that one of the recommendations was that all the stakeholders or the communities had to interact with the Department of Environment, Forestry and Fisheries (DEFF), so the DEFF had to report on the feedback.

The Chairperson said that the Committee had to develop an action plan for recommendations to conduct a second meeting with all the stakeholders. The action plan should include all the governmental departments, because they were responsible for ensuring that laws were implemented.

He asked for a timeframe to be set by the Committee for an action plan. The action plan must be detailed to reflect who would do what and by when. He added that he was unsure whether this technocratic process would be the administration’s responsibility, or the Portfolio Committee’s.

Mr Bryant said that the Committee needed something formal in terms of item 6.1, to consider the draft recommendations.

The Committee Content Adviser corrected the Committee, and said the report included recommendations on 6.1.1 from the iSimingaliso Wetland Park Authority, 6.1.2 from Engen, and 6.1.3 on community engagement with the stakeholders. He suggested that the Committee needed to look at these recommendations.

The acting Chairperson corrected the Committee Content Adviser, and said Annexure 1 of the report had to indicate each stakeholder’s recommendations and indicate the action or responsibility that each stakeholder must undertake.

The Committee Content Adviser responded that the report contained all of the recommendations. He therefore urged the Committee to meditate on them and offer suggestions.

Mr Bryant said that the document that they had been given did not match the one shown by the Committee Content Adviser. The 6.1 in the report was blank, while the one in The Committee Content Adviser’s document was detailed. He thought that was why they were all confused.

The acting Chairperson said they could not adopt a report that had one sentence recommendations. A section was needed that dealt with recommendations and people who would be responsible for executing the proposed recommendations.

The Committee Content Adviser said that the report’s inconsistencies were due to the document being converted from Word to PDF.

Mr Bryant proposed that the Committee should move the adoption of the report to the next meeting. The extension would allow the absent Members to apply their minds to the report.

Mr Paulsen, Mr Singh, Ms Phillips and the Chairperson supported Mr Bryant’s proposal for an extension.

The acting Chairperson handed over to the Chairperson of the Committee.

The Chairperson invited the Minister to welcome the presenting teams.

iSimangaliso Wetland Park Q3 performance

Minister Creecy asked Mr Sibusiso Bukhosini, Chief Executive Officer (CEO), iSimangaliso Wetland Park, to present their Quarter 3 performance report.

The iSimangaliso Wetland Park performance report was categorised into four programmes: Corporate Support Services, Biodiversity Conservation, Tourism and Business Development; and Socio-Economic Environment Development. The overall performance scored reported by the park was 90% on target, 6% work in progress, and 4% off-target

Financial performance

The financial report was delivered by Ms Qhamu Mntambo, Chief Financial Officer (CFO).

She said the current ratio of iSimangaliso Wetland Parks’ assets (R222.7 million) to liabilities (R265.5 million) was 0.83. Compared to assets, the higher liabilities were due to the presidential stimulus received in October, and the contractors appointed for this project started only in December.

The revenue generated for the period ending on 31 December was 11% below budget, as the grant income was 11% below the budgeted amount. However, park revenue had increased in the period as some concessionaires had started trading in September, and they had started the billing as they moved to level 1.

SA National Biodiversity Institute Q3 performance

Minister Creecy invited Ms Carmel Mbizvo, CEO, SA National Biodiversity Institute (SANBI), to deliver the entity’s presentation.

Ms Mbizvo said that the challenges that continued to impact on SANBI’s implementation of planned activities were:

• The effect of COVID-19 on marketing services, schools, higher education institutions, the partially operating national botanical and zoological gardens, and fieldwork.
• Budget shortfalls.
• Redesigned stakeholder engagements. Meetings, training courses and workshops were held virtually.
• Implementation of an innovative and adaptive approach to deal with human and financial constraints under the challenging new normal operating environment.

The SANBI report was categorised into four programmes: National Botanical and National Zoological Gardens; Biodiversity Science and Policy Advice; Administration and Human Capital Development; and Transformation. The overall performance for SANBI was 87 % on target, 6 % work in progress, and 7 % off-target.

Financial Performance

Ms Lorato Sithole, CFO, SANBI, said the total current and non-current assets at the end of the third quarter amounted to R876.4 million. The total expenditure -- employee costs, operating expense, capital spending and depreciation -- was R 513 million, which was R1.97 million below budget.

Discussion

Mr Paulsen asked the iSimangaliso Wetland team what the impact had been of the shift from a physical to an online stakeholder survey. How did they ensure they reached the entire stakeholder population’s input? He commended SANBI for their excellent performance, and asked what they were going to do to ensure that the asset to liability ratio was maintained?

Mr Bryant asked SANBI if they were still on track regarding the number of visitors to the SANParks, as highlighted in the presentation. He also wanted to know about the state of indigenous flora species that had been added to the national conservation programme because of the threat of extinction.

Responses

Mr Bukhosini said that the face to face interviews were limited due to the level 1 COVID-19 restrictions, hence the move to online surveys. He said they had analysed and separated stakeholders into those who had access online and those who did not have access. Questionnaires had been forwarded to specific stakeholders so that they could fill in the forms. The collection point was at the traditional authorities’ offices. He stressed that in cases when there was a relaxation of the restrictions, iSimangaliso Wetland Park carried on conducting face to face interaction surveys, while observing the COVID-19 regulations and measures.

Ms Mbizvo referred to the extinction of flora species, and said that SANBI was monitoring this issue. There were different approaches, such as monitoring programmes, citizen scientists and research, to deal with the issue.

Ms Sithole said that SANBI regularly monitored its financial performance on a monthly basis, where the levels of liabilities were reviewed and overall assets were considered. This financial monitoring process enabled SANBI to rectify any issues identified, in order to meet their obligations.

Mr Bryant asked whether the dual pricing for botanical gardens was still on track for implementation by 1 April.

Ms Mbizvo said that SANBI, together with the stakeholders and tour operators, had carefully looked into the dual pricing issue, and they were putting in place measures needed to implement the dual pricing. It was still a work in progress, and they would be implementing it at Kirstenbosch Gardens, but the process required paperwork.

Marine Living Resources Fund Q3 performance

Ms Sue Middleton, acting Deputy Director General (DDG), Marine Living Resources Fund (MLRF), said the performance report was similar to the report that had been presented last week. The only difference was that the number of full-time equivalent (FTE) jobs created under the Working for Fisheries programme had not been included. However, they were on target for Q3, and had caught up with Q2 as well.


She introduced the MRLF’s newly appointed CFO, Mr Witness Rooifontein, deliver the financial Report. She highlighted that he had taken up office on 1 March -- a position that had been vacant since 2010.

Financial Performance
Mr Rooifontein said the total revenue from fees, licences, permits and fines had been R248.9 million, while the total expenditure had amounted to R229.5 million. Mr Rooifontein highlighted that they were 14 % behind in terms of revenue for the current financial year. The areas of concern were the levies. The MLRF was in the process of getting the industries to pay the levies.

He also pointed out that COVID-19 had had an impact on their revenue streams, so they had had to grant exemptions for people to catch fish and pay their levies later. The fishing industry had been coming forward to pay the fees and levies from January 2021.

He said that the financial contributions from the Treasury to repair the Africana had been received, and the process of procuring the engines had already started. The award for the repairs would be made by the end of this financial year so that the repairs could commence.

Discussion

Mr Bryant asked MLRF what their current challenges in terms of collecting funds were, as the collection rate was quite low. He also asked about the expenditure for the procurement of new engines to repair the Africana, and how this process was linked to the fishing right allocation process.

Mr Paulsen said that it was very odd for the MLRF to budget an amount to confiscate peoples’ assets and fish products. He asked when the Minister would present the audit report based on the small scale fisheries allocations that went to the high court, and what consequence management actions had been adopted regarding issues raised in the audit report. How would the MLRF help small scale fisheries while there were delays in the audit report caused by the court action? What were other government departments providing through the DEFF to assist small scale fishers?

Responses

Minister Creecy said that the documents and audit report on the matter involving the high court and the small scale fishers in the Western Cape was available for public access on the DEFF website. The audit had reflected that the Western Cape processes did not provide any basis on which the executive could quickly make a decision. The Minister said the situation was that the small scale fisheries would continue to fish until all the processes were completed. They had asked the court for the status quo to remain so that the small scale fishers would not be disadvantaged. The DEFF partnered with the Department of Small Business Development (DSBD) and other provincial departments regarding small scale fishing cooperatives.

Ms Middleton referred to the late levy payments, and said exemptions had been granted for small scale fisheries to continue fishing with the old permits. She said there was no link between the Africana engine replacement and the fishing rights allocation process.

Mr Rooifontein replied to Mr Paulsen regarding the R14 million budget for the confiscated goods. At the end of each financial year, depending on how much of the confiscated goods was disposed of, the MLRF normally had available stock. Based on this assessment, it anticipated how much they would earn.

He added that in their financial report, they had lumped the Africana repairs amount with the fishing right allocations, but there was no link between them.

Follow-up discussion

Mr Bryant asked how much of the envisaged expenditure would cover the cost of the engines for the Africana.

Mr Rooifontein said that the anticipated cost of the engines was estimated at R45 million, out of a total of R95 million. He added that there were components such as electrical pipes that would need to be accounted for.

SA National Parks Q3 performance

Mr Fundisile Mketeni, CEO, SANParks said the entity’s report was categorised into four outcome goals. These were:

• Sustainable biodiversity and cultural heritage across land and sea.
• Improved diverse and responsible tourism.
• Sustainable socio-economic development programmes.
• A sustainable and transformed organization.

The SANParks been on target with 85% of their goals, 4 % were still works in probress, and 11 % were off-target.

Financial Performance

Mr Dumisani Dlamini, CFO, SANParks, said total revenue year-to-date had amounted to R1.584 billion, and was R183 million more than the estimated budget of R1.401 billion. This positive variance was achieved through unrecognised operating income, including the Expanded Public Works Programme (EPWP) grant income and unbudgeted infrastructure liability income.

Due to a delay in maintenance spending and saving in operating costs, the total year-to-date expenditure of SANParks was R1.629 billion, which was R200 million below the R1.829 billion budget

Discussion

Mr Paulsen asked SANParks how they would ensure that all expenditure would follow good supply chain management (SCM) practices. He stressed that the financial performance from last year must never be repeated again in the future.

Mr Bryant said he did not understand why an entity like SANParks would rate itself highly in terms of rhino poaching targets. Poaching was a criminal offence, so the aim should be zero rhino and elephant poaching, not a set of numbers to allow poaching. Mr Bryant said the audit tender should not be delayed any further, because it was an essential aspect.

Response

The Deputy Minister thanked the Members for their questions, and invited the SANParks team to comment.

Mr Mketeni responded regarding supply chain management, and said SANParks had a procurement plan that had to be submitted to the Treasury, and a set of committees and programmes in terms of the rollout. They had realised that their SCM and systems were not speaking to each other in the past. However, they were seeing a decline in irregular expenditures because they had questioned people, facilitated determination tests and applied consequence management. He said that most of the challenges regarding SCM were now historical.

He said Mr Bryant had been right to question the rhino and elephant poaching targets. However, SANParks analysed the trends, and setting zero poaching targets would be superficial. One had to compare the large size of the Kruger National Park (KNP) against other SANParks. The size of KNP made it difficult to put a zero target for rhino and elephant poaching.

He said the board had increased the entity’s capacity and approved a turnaround strategy and audit plan to deal with the delay on the internal audit tender.

Mr Dlamini emphasised that SANParks’ policies and standard operating procedures for SCM were very strong, but most of the employees were not aware of them. They had launched a magazine, developed an action plan, and conducted workshops and engagements to make sure that expenditure was in accordance with supply chain management policies.

Dr Luthando Dziba, Managing Executive: Conservation Services, SANParks, clarified the percentages applied to rhino populations. He said the decline in the rhino population in KNP was the annual target, and the quarterly target that they were reporting against was based on the annual surveys that would have been planned and conducted.  What they had reported in Q3 was that the population surveys in KNP had been planned and complemented, and the data analysis was under way. They had therefore not come to the point of reporting on whether they had been able to achieve the target of halting the rhino population decline in the KNP.

He said the growth in rhino poaching in the KNP had peaked in 2014. There had been numerous anti-rhino poaching interventions that SANParks had implemented, which had cost over R200 million per annum. They had seen a decline in 2019/2020 in the KNP, and they would report a decline in 2020/21 in due time. They were benchmarking their target to reduce rhino poaching based on the data and trends from the previous years. They would like to see rhino poaching at zero, but the reality was that rhino poaching remained a big challenge for SANParks and the whole country.

The Chairperson invited further comments from the Committee.

Mr Bryant thanked the officials for their responses, and stressed that he did not doubt any of SANParks’s efforts to reduce the number of rhino and elephant being poached. However, they did not want a sense of complacency to set in. One would read through these targets and think that SANParks was somehow achieving them by allowing a certain amount of criminal activity to take place, particularly within the KNP boundaries. He was just urging SANParks to try to be a bit more ambitious.

The Chairperson said that Mr Bryant’s desire reflected that of the Committee - targets always had to be challenged.

Deputy Minister Sotyu said she had taken note of Mr Bryant’s comments, and stressed that the DEFF was trying its best to achieve its targets.

The meeting was adjourned.