IEC 2019/20 Annual Report; Home Affairs Budget: Committee Report; with Deputy Minister

Meeting report

Mr Eddie Mathonsi, Committee Secretary, reported that the Chairperson, Adv B Bongo (ANC), was on leave. Mr M Chabane (ANC) was elected as Acting Chairperson.

The Acting Chairperson welcomed Members and the delegation from the Independent Electoral Commission (IEC), and noted an apology from Ms L van der Merwe (IFP).

The purpose of the meeting was for the Committee to be briefed by the IEC on its annual report and financial statements for the 2019/20 financial year. Another item on the agenda was for the Committee to consider and adopt its report on the Budget Vote for the Department of Home Affairs (DHA) and its entities, after the briefings received in previous meetings.

The delegation from the IEC consisted of Mr Glen Mashinini, Chairperson; Ms Janet Love, Deputy Chairperson; Mr Sy Mamabolo, Chief Electoral Officer; Mr Masego Sheburi, Deputy Chief Electoral Officer: Electoral Operations; Mr Mawethu Mosery, Acting Deputy Chief Electoral Officer: Electoral Operations;  and Mr Mosotho Moepya, IEC Commissioner.

The delegation from the DHA consisted of Mr Nzuza Njabulo, Deputy Minister; and Mr Tommy Makhode, the Director-General (DG).

IEC's 2019/20 annual report and financial statements

IEC Chairperson's opening remarks

Mr Mashinini said it had been 14 months since the conclusion of the 2019/20 financial year, and the focus was now on preparing for the upcoming government elections. The elections were a chance for the government to reflect on its successes and the challenges that the country had faced during the delivering of the sixth national and provincial elections in 2019. It was also a time for the IEC to reflect on how it could enhance its systems, controls and performance management, as part of its quest to continuously improve its service delivery.

The IEC had delivered free and fair national and provincial elections on 8 May 2019. The election had recorded a high number of voters (26.6 million) who were registered on the voters’ roll. A record number of 78 political parties were involved, and a record of 570 000 special votes were cast. It had recorded the lowest percentage of spoiled ballots since the 1998 --1.27% in 2019, compared to 1.29% in 1998. The election had also recorded the highest percentage of women elected to the National Assembly (45.25%) which was a major development for South Africa.

The satisfaction surveys from the election showed that there was a continued need to make improvements in the processes of the IEC, particularly with regard to accessibility and participation. The results from the election in 2019 showed that on election day, 68% of voters needed fewer than 15 minutes to reach their designated voting stations. The average waiting time to be allowed to vote had been recorded at 16 minutes. The survey resulted showed a high level of confidence by voters that it was a free and fair election. Voter turnout was recorded at 66%, which continued the declining trend from previous financial years. This needed continuous intervention by the IEC.

A further area of concern during the election and the counting of votes, as well as in the internal and external post-election analysis, was the spectre of potential multiple voting. Voters “shop around” for shorter queues, and the lack of the IEC’s ability to track and monitor voter participation in real time emerged as a threat to the integrity of the election, which had to be mitigated in future. Allegations of double voting posed a risk to the overall credibility of the election, but the investigations showed no evidence to support these allegations.

Audit outcomes for the IEC:

Mr Mamabolo said the IEC had received an unqualified audit opinion from the Auditor-General of South Africa (AGSA) for the 2019/20 financial year, as well as for the previous financial year. It was committed to continue working towards obtaining a clean audit outcome and would invest its resources and time into realising this strategic objective.

For the 2019/20 financial year, the IEC had R 2.14bn in revenue, and R 2bn in expenditure. It had 906 permanent staff members with an average age of 45 years, and a 2.5% staff turnover rate. There were 26.7 million registered voters, and 95% of registered voters had a complete address listed with the IEC. Given that a complete and verifiable residential address was not a universal concept in South Africa, this was a significant achievement. For the 2019/20 financial year, there had been 22 924 voting districts across South Africa. One general election had been held in 2019 for the national and provincial elections, in addition to the 144 municipal ward by-elections that were declared to be free and fair. No elections were set aside through judicial reviews of the procedures followed and implemented.

Performance information per programme:

For the 2019/20 financial year, the IEC had set 27 targets, of which 19 (70%) were achieved. The IEC outlined its performance per programme as follows:

Programme One (Administration)

Seven out of ten targets were achieved (70%). The IEC supported the achievement of the strategic outcome-oriented goal, which provides for its overall strategic management, as well as the centralised support services. This programme focuses on strengthening governance by refining institutional governance arrangements, including the IEC’s committees and structures, exercising oversight, monitoring, evaluation and support. The strategic objectives included are to exercise oversight -- monitoring, evaluation and leadership -- to ensure the effective implementation of the IEC’s core mandate, strategic goals and objectives, aligned with the corresponding budget allocation; to exercise oversight -- monitoring, evaluation and support -- over the provisioning of assurance and risk management services; to build institutional capacity to enable the IEC to deliver on its constitutional mandate; to manage financial resources efficiently to protect the public image of the IEC as an accountable institution; and to provide and maintain a stable, secure and scalable information communication technology (ICT) environment that meets the functional needs of the IEC, to ensure the credibility of electronic electoral processes.

Programme Two (Electoral Operations)

Seven out of ten targets were achieved (70%). The IEC supported the achievement of the strategic outcome-oriented goal, which facilitates the participation of voters in regular free and fair elections, using sustainable systems, people and processes. Activities include the delimitation of voting district boundaries, the compilation and maintenance of the national voters’ roll, and the planning and coordination of activities during registration weekends, on voting day and on special voting days, as well as home visits. The strategic objectives include managing free and fair elections in accordance with the applicable electoral timetables to ensure the efficient and credible execution of the mandate of the IEC; to maintain an accurate national common voters’ roll to ensure the credibility of elections; to ensure efficient election delivery by the timely establishment of accessible and suitable voting facilities and processes and, by applying infrastructure and logistical resources, to meet operational demands for main electoral events; to provide consultative and cooperative liaison platforms between the IEC and political parties to facilitate free and fair elections; and to strive for excellence at the voting station level to enhance the integrity of elections.

Programme Three (Outreach)

Five of the seven targets were achieved (71%). The IEC supported the achievement of the strategic outcome-oriented goal which encompasses civic and democracy education, communications and media relations, research and knowledge management, and stakeholder engagement. The strategic objectives included were to encourage the electorate’s engagement with, and participation in, electoral processes to facilitate the right to vote as enshrined in the Constitution; to achieve a low rate of spoilt ballots as a measure of the effectiveness of civic and democracy programmes; to enhance the IEC’s reputation as a credible and trustworthy electoral management body; and to provide thought leadership in the field of electoral management to strengthen electoral democracy.

Annual financial statements

The basis of preparation remained unchanged from the prior year. Financial statements encompass the reporting as specified in the Public Finance Management Act (PFMA). The annual financial statements had been prepared in accordance with relevant accounting standards. There were no changes in the accounting policies of the IEC.

The IEC’s total revenue for the 2019/20 financial year was R 2.02bn, which was a parliamentary allocation. Additionally, R 57 million was derived from sundry income -- interest earned from short-term investments. The annual budget covered the costs of administration (the remuneration of permanent staff, office rentals and other ongoing costs of equipment and services), as well as the costs of specific electoral events, such as voter registration activities and national, provincial, local and by-elections.

The IEC’s revenue had increase by 3% to R 2.07bn from the previous financial year, resulting from the 2.4% increase in Parliamentary revenue due to it being an election year, and the 0.6% increase, mainly from investment revenue and sponsorship income. Operating expenses had increased by 25% to R 1.93bn. This increase could be attributed to budgeted election expenses, mainly for goods and services. A saving of R225 million was achieved against budgeted costs. A surplus of R133 million was recorded for the 2019/20 financial year, showing a decrease from the R455.8 million recorded for the 2018/19 financial year. The decrease from the prior year was due to expenses relating to the national and provincial elections in 2019. The prior-year surplus was to be carried over for election-committed expenses.

Liquidity had improved from an average ratio of 2.6 to 3.8, with a cash ratio of 3.6 and a current ratio of 3.9. Both could be attributed to the allocation received for investment in the new election management devices to be delivered in the 2020/21 financial year. Cash paid to suppliers and employees amounted to 92% of the total cash flows, amounting to R1.9bn. Capital investment amounted to R73.5 million, of which R20 million had been invested in intellectual property and R54 million in capital assets. This brought capital expenditure over the past three years to R137 million. In the 2019/20 financial year, R12.3 million was spent on repairs and the maintenance of capital assets. Electoral staff costs made up 15% of total expenditure at R286 million for the employment of 200 855 people. Voting station rentals of R18 million made up 1% of the total expenditure reported for 22 924 voting stations.

Compliance with laws and regulations

The IEC incurred R21.52 million in irregular expenditure for the 2019/20 financial year. The irregular expenditure had decreased by 513% from the previous year. There had been five dismissals, which were as a result of the irregular expenditure incurred. There were no material findings identified by AGSA, as only 2% of the balance of irregular expenditure was identified. The National Treasury had condoned R25.76 million in the reporting period, as there had been no financial loss to the state and appropriate remedial action and enhancements in processes and controls had been implemented. The remaining balance was related to irregular expenditure dating back to 2013, and the IEC was conducting investigations in this regard. Fruitless and wasteful expenditure had amounted to R1.35 million. The IEC reported that 98% of the balance was related to fraud involving petrol cards, and this had been reported to the South African Police Service (SAPS).

Discussion

Ms M Molekwa (ANC) congratulated the IEC on obtaining an unqualified audit opinion from the AGSA, and said the Committee appreciated the work and efforts that had been put in to ensure this achievement. While the Committee could understand the challenges faced by the IEC on the targets that were not achieved, the entity must be encouraged to put in more effort regarding voter registration. Given the upcoming local government elections, it was crucial that more people were mobilised, especially the youth, and encouraged to register to vote. She asked whether the budget allocation of 5% would be enough for election materials, considering the quantities needed for voting and for the registration of voters before the upcoming elections.

Mr A Roos (DA) referred to the IEC’s reasoning that the reduction in voter registration weekends had resulted in the target for voter registration being missed, and noted that the voter registration weekends had again been reduced for the upcoming local government elections. What initiatives would the IEC implement to correct this causal effect? He commended the IEC for getting its irregular expenditure under control. The IEC’s performance had always been around the 70% to 80% segment. What measures had been put in place to ensure a higher performance achievement in the next financial year? Would it be monitoring the advertisements of political parties on the channels of the South African Broadcasting Commission (SABC), and through which measures would this be monitored?

Ms T Legwase (ANC) asked if the process for the realignment of wards been concluded. It was crucial that the Committee was updated in this regard, as when they did constituency work it was clear that voters were confused about their demarcation.

Ms A Khanyile (DA) noted that there were five dismissals which were as a result of the irregular expenditure incurred, and these dismissals were related to the remaining balance of irregular expenditure. She applauded the IEC on its implementation of consequence management. She asked whether the voter management devices would be ready before 27 October for the upcoming local government elections. The issues of low numbers for voter registration and turnout remained grave concerns. What measures had been put in place by the IEC to increase the voter registration and turnout for the upcoming local government elections?

Mr M Tshwaku (EFF) asked what would be done by the IEC to ensure that political parties had the proper oversight to ensure that the elections were indeed free and fair. He said it was not enough to have voters with completed addresses -- the accuracy of these addresses had to be ensured to determine where voters were currently residing. There was a need for more offices of the IEC to be available, especially in rural areas. This would also make it easier for voters to change their addresses. How was the IEC verifying the addresses presented by voters to ensure that they were voting in the correct wards?

Mr M Lekota (COPE) asked for clarity on the allegations that the voting ink identifying voters who had already cast their votes was removable, and that people were voting multiple times. It was important that the IEC could completely rely on this method of checking whether a voter had already voted. There could not be reliable, free and fair elections if there were no mechanisms that guaranteed that people voted only once. This would also make the electoral system vulnerable, because people who were not citizens of South Africa could also vote multiple times in this way.

Mr K Pillay (ANC) agreed with Members’ concerns on the need to address the low voter turnout for elections. What impact would the COVID-19 pandemic have on voter turnout?

The Acting Chairperson commented that the recent amendments to South Africa’s electoral legislation gave effect to certain areas that had been highlighted as concerning by Members. He asked for more information on the measures that the IEC would put in place to mobilise the people of South Africa, especially the youth, to make it easier to register as voters for the upcoming local government elections. When the IEC was struggling to acquire the funding for the new voter management devices for the elections, engagements had been held with the National Treasury and the Government Printing Works (GPW). How would the repayments for the funding affect the IEC’s financial status going forward?

IEC's response

Mr Mamabolo referred to the questions on the realignment of wards to voting districts, and said the Municipal Demarcation Board handed over the wards to the IEC, and the process to align the final wards to the voting districts was under way. The IEC was working to resolve the 1 200 voting districts that had been split, and political consultations processes were taking place. The only outstanding task was for the communities in the split portions to be registered, which would be done through a targeted registration campaign in June. The IEC was considering additional modalities for voter registration. It would implement electronic voter registration ahead of the local government elections on 27 October. There would be built-in safeguards to ensure that a person who voted had been registered. Further announcements regarding the electronic voter registration would be made in due course.

The trends regarding voter turnout were interesting, because the decline experienced in national and provincial elections (NPEs) was not prevalent in local government elections. Previously, in 2011, the voter turnout had improved from 48% to 58% which was retained until 2016. It was unclear what the impact of the COVID-19 pandemic would be on the voter turnout for the upcoming elections. If there had been no pandemic, the IEC would have pushed extremely hard through its programmes on voter education and communication, to push voter turnout into the 60% area, as it was especially important to ensure that the turnout increased with every ensuing election. There were no indicators as to how voters would react to the reality of the COVID-19 pandemic, and the extent to which it would discourage voter turnout for the upcoming local government elections. There would still be programmes to explain the safety measures that the IEC were introduction at the voting stations.

Significant resources had been spent on encouraging young people to register, and online and radio advertisements were scheduled for when there would be a high listenership of the youth. The launch of the upcoming local government elections had not happened yet, and the IEC would later update the Committee on the scheduled date for launching. Thereafter, a media campaign would also be launched to encourage voter participation. The appointment processes of presiding officers were under way, which would also allow for people or political parties to raise objections.

The voters’ roll was important, as it played a pivotal role in protecting the integrity of the elections, based on the accuracy of voters’ information and its verification. During the election period, political parties were also given copies of the voters’ roll, with the expectation that they would inspect the roll ahead of the certification. If objections were raised by the political parties, those objections were considered by the IEC before the voters’ roll was certified.

Regarding the question about the IEC acquiring the funding for the new voter management devices for the elections, engagements had been held with the National Treasury and the GPW. There was no lawful procedure to facilitate these payments, meaning that the funding for the voter management devices had to be financed via a direct transfer to the IEC by the National Treasury. He confirmed that the voter management devices would be ready for the upcoming elections.

Mr Mashinini said he appreciated the commendations from Members and the recognition of the hard work of the IEC, especially given the hard work put in by its employees ahead of the upcoming local government elections. South Africa did not have mechanisms or laws for compulsory voting and participation -- if one did not participate in the elections in other countries, one could get fined. Voting was voluntary, and this had an impact on voter turnout and participation. There were also numerous factors that discouraged voting, which the IEC did not have control over. Between 1994 and 1998, the IEC had ‘deep pockets’ to promote the elections, but this was no longer the financial situation of the entity, which meant it had to be creative with its limited resources. This included investing in social media, because young people were more likely to be informed on these platforms than by the evening news, for example.

Deputy Minister Njabulo said the DHA did not conduct managerial oversight over the IEC, as the entity had to maintain its independence to facilitate free and fair elections. The IEC’s ability to host the upcoming local government elections in the uncharted territory of the COVID-19 pandemic must be noted and appreciated. He implored political parties to get involved in the mobilisation of people, to get them to register and vote in the upcoming elections.

Portfolio Committee on Home Affairs Report: Vote 5 Annual Performance Plans and Budget of the Department of Home Affairs, Electoral Commission and Government Printing Works

Committee Secretary Mathonsi presented the draft version of the Committee’s Report on Budget Vote 5 relating to the APP and the budget of the DHA, the IEC and the GPW, as the entities of the DHA. He said that it was necessary for Members to consider only the section on recommendations in the report, as it was the only area where contributions had been received for further amendments. Amendments had been made to the recommendations section regarding the IEC and the GPW.

The Acting Chairperson asked Members to indicate their support or lack of support for the report.

The amended report was adopted. The EFF abstained from voting on the report.

The meeting was adjourned.