DIRCO & ARF 2021/22 Quarter 3 performance, with Deputy Minister

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International Relations

09 February 2022
Chairperson: Mr S Mahumapelo (ANC)
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Meeting Summary

Video

The virtual meeting was delayed by 30 minutes to allow the Portfolio Committee to have a private analysis and discussion of the Quarter 3 Reports due to their late delivery. Thereafter, Department of International Relations and Cooperation (DIRCO) and the African Renaissance and International Co-Operation Fund (ARF) presented.

During the discussions, Committee members’ frustration with the Department’s lack of progress was evident. Members asked if the ARF’s contribution to Cuba to assist with its food security crisis was a loan or donation, and how this impacted relations with the International Monetary Fund (IMF). They requested clarity on South Africa’s stance on the Russia-Ukraine crisis. A progress update was requested on the Free Movement of Person’s Protocol and the One-Stop Border Post programme. Members complained that the Committee was not informed by the Department about fiascos involving South African ambassadors – it only learnt about these through the media.

The proposed youth development programme between South Africa and Nigeria was scrutinised, with Members asking how participants would be selected, and according to what criteria. DIRCO’s dispute with the City of Tshwane for alleged unpaid utility bills was raised as a concern. Members noted with disapproval that only 70% of DIRCO’s budget had been spent by the end of Q3, and warned against fiscal dumping in the final quarter.

There were two main concerns during the discussion. One was an expired ICT contract as the bid for a new tender had to be restarted three times. The irregular expired contract with BT Communications had to continue despite Treasury’s non-approval. Members requested information on the R8.4 million per month payments for bandwidth to BT Communications, DIRCO’s long-term intentions for the contract, and an explanation for the irregular status of the contract. The perpetual absence of Bid Evaluation Committee members, which contributed to bid delays, was condemned and disciplinary action was recommended.

The other criticism was about the creation of a Property Management division within DIRCO separate from the Department of Public Works and Infrastructure (DPWI). Members were concerned that a separate unit did not exist and there seemed not to be a clear property management strategy or qualified individuals leading this endeavour.

In conclusion, the Chairperson highlighted steps for the way forward. This included implementation of a Resolutions Tracking and Implementation Framework to track the progress of all committee resolutions entered into. It also included a dedicated Committee meeting to deal solely with the BT Communications contract and ICT challenges. He urged DIRCO to improve its reporting system and emphasised the importance of predictability and certainty going forward.

Meeting report

Initial committee discussion on receiving the presentation late
The Chairperson noted the challenge the Committee faced in conducting this performance review, since there was a delay in DIRCO’s delivery of the reports to the Committee.

DIRCO knew it had to deliver its documents at least three days before a meeting. This was to allow the Committee ample time to do its own research, scrutinise the report, look at previous reports, and conduct a comparative analysis to gain an informed opinion on Department performance. However, the report was only delivered to the Committee the previous day at lunchtime. Thus, the Committee did not have sufficient time to conduct its own research or undertake an intense scrutiny of the report.

The Chairperson therefore suggested that the meeting be delayed by 30 minutes, so that the Committee could privately go through the documents with its researcher.

Mr D Bergman (DA) noted that the Chairperson and the Committee have been disrespected by this delayed report delivery. However, the fact that the Chairperson was disrespected should not mean that the Committee should be delayed any further. Committee members should not be penalised for administration delays. If the Committee is taken through the reports by DIRCO then it can interrogate the report from this briefing. This will prevent a waste of time. Otherwise, the report needs to be sent back to DIRCO, and they will meet another time. The Committee should not have to delay to do further homework, as a result of DIRCO’s report coming late.

Mr T Mpanza (ANC) indicated that the Committee has experienced this behaviour from DIRCO many times. He did not agree that it is the correct approach always to postpone the meeting. He acknowledged that Mr Bergman’s comments made sense, but persuaded Committee members that a 30 minute delay would not do them any harm. Rather, it would empower the Committee to engage with DIRCO in an informed manner. He conceded that he had not had time to fully read the report himself – he had only glanced over it – and this would not do it justice. However, if the Members were granted 30 minutes privately with their content adviser, they could be more informed and at least have an idea of what areas should be engaged on with DIRCO.

Ms T Msane (EFF) agreed that this behaviour had happened before. She recommended that the Committee take 30 minutes to go through the report. However, DIRCO must know that they have backed the Committee into a corner, forcing it to take 30 minutes of its own time to discuss a report DIRCO should have delivered on time. This conduct is a means of disempowering Committee members, and so the Chairperson should be very firm on this. Should it happen again, the Committee would be left with no choice but to send DIRCO packing. The following day is the State of the Nation Address (SONA), MPs are travelling, and so receiving a report late is unacceptable. This should be the last time this happens.

Mr X Nqola (ANC) agreed to the 30 minute break after which it could return to a fully-fledged session with DIRCO and the media.

Deputy Minister of International Relations and Cooperation, Mr Alvin Botes, supported the Chairperson’s suggestion that the Committee take 30 minutes in private to analyse the report. At all times, the Portfolio Committee should be well-versed with issues at hand. He explained that the Acting Director-General of DIRCO, Ambassador Nonceba Losi, advised him that apology for the late report should be accompanied with the fact that that normally DIRCO is informed in advance about meeting requests. However, DIRCO only received the request to prepare the Quarter 3 performance reports on Friday 4 February. Thus, it had to compromise the three-day rule. the Deputy Minister thought that this was worth mentioning for the sake of clarity. The delay was not due to DIRCO’s lack of commitment to the prescripts of the Committee.

The Chairperson replied that the presumption was that the Quarter 3 reports must be ready now because the PFMA dictates this. However, he did get the Deputy Minister’s point.

Mr D Moela (ANC) said that this meeting with DIRCO must come to an end. Another meeting must be held with the Minister at an appropriate time to raise this issue. The Committee cannot continue to be undermined in this manner.

The Chairperson confirmed that the meeting with DIRCO would commence again at 11:00.

Mr B Nkosi (ANC) asked that DIRCO officials still present on the platform should leave and rejoin at 11:00.

The Portfolio Committee and its Content Adviser then discussed the reports for 30 minutes.

Chairperson’s opening remarks
The Chairperson welcomed DIRCO and media and noted they have come from the 35th Ordinary Session of the African Union. Some observations from this AU session would compel them to return to some of those issues in future to determine South Africa’s stance on particular matters.

The quarterly report is about the performance of DIRCO as per the dictates of Public Finance Management Act (PFMA), the targets DIRCO has set for itself, the necessary systems it committed itself to implement to achieve its targets, and the Committee is doing its required quality oversight on DIRCO. He hoped that this meeting would enable the Committee to achieve its oversight objectives. The objective of this meeting is to arrive at a synchronised quarterly performance review summary.

DIRCO as the executive arm is implementing programmes on behalf of people of the Republic. Taxpayers’ money constitutes the revenue for the state, which it allocates to departments, provinces and municipalities to ensure delivery of quality services to the people. The same taxpayer pays Portfolio Committee members to perform parliamentary oversight of the state. When all else fails, one can approach the other oversight arm of the state – the judiciary – to deal with any issues. Essentially, at the centre of these three arms of the state are the masses of South Africa. Whatever these arms of government do, they need to bear in mind this fact. The taxpayer ensures these arms are able to do their work. This is the context in which DIRCO and the Committee need to understand accountability.

Finally, he noted that he was looking forward to the SONA the following day. Due to SONA and Members’ travelling engagements to it, he requested DIRCO keep its presentations and responses to questions concise, without compromising on quality.

DIRCO Quarter 3 performance report
Ms Charlotte Lobe, DIRCO Acting Chief Operations Officer, stated that DIRCO achieved a 96% success rate for its Q3 targets.

Under Quarter 1 and 2, the COVID-19 pandemic deeply impacted economies, societies and political systems globally. Diplomatic operations and relations were affected by these disruptions. Consequently, most countries introduced travel restrictions and resorted to digital diplomacy and the use of information and communication technology (ICT) to conduct diplomacy to ensure business continuity.

Ms Lobe presented the performance information and highlighted key challenges and achievements in the implementation of South Africa’s foreign policy:
• Programme 2 International Relations had a 100% achievement rate for Q3. DIRCO achievements in political, investment, trade and tourism relations were noted.
• Programme 3 International Cooperation had an 80% achievement rate for Q3, which included global governance, continental cooperation and South-South cooperation. One of the five targets was not achieved which was a report on South Africa’s obligations to SADC and AU which was not submitted during the period under review.
• Programme 4 Public Diplomacy; State Protocol & Consular Services had a 100% achievement for Q3.
• Programme 1: Administration had a 100% achievement rate for Q3. The targets included Digital Strategy, Audit Action Plan, training programme, outreach, and legal service objectives.

The Q3 Financial Report for Q3 broke down expenditure for each programme.

(See attached presentation for details)

African Renaissance Fund Quarter 3 performance report
Ms Hlengiwe Bhengu, Acting Chief Financial Officer, DIRCO, highlighted the mandate and objectives of the ARF.

South Africa will continue to play an active role in supporting initiatives aimed at enhancing the African Agenda. One of the ARF strategic objectives is the promotion of democracy and good governance, which is in line with South African foreign policy. This is done through support and active participation in the implementation of the AU Agenda 2063.

In pursuing this objective, South Africa had extended the Lesotho Peace process facilitation. This was as per the recommendations of the 41st Ordinary Summit of Heads of State and Government held in the Republic of Malawi, which decided that the role of the SADC facilitator to the Kingdom of Lesotho continue until August 2022. This will maintain peace and stability in SADC, particular in the Kingdom of Lesotho.

The COVID-19 pandemic impact has been global in scale and this necessitates coordinated international action to capacitate all countries to respond effectively. South Africa has pledged to support international efforts to combat COVID-19 in Africa. Additional funding was approved for Humanitarian Assistance for pledges by South Africa to combat the virus in Africa.

In terms of performance, there was an 80% achievement of targets for Q3 under the Administration programme. There was a 66.66% achievement in its humanitarian assistance and promotion of democracy and good governance programmes. The Q3 Financial Report was also presented.

(See attached presentation for details)

Discussion
Mr Bergman congratulated DIRCO on the work it had done in West Africa. The Economic Community of West African States (ECOWAS) countries are a growing region in Africa and are "the countries to watch”. It is positive that South Africa is now “cosying up” to those countries. He remarked with humour that he obviously knew why they were cosying up to Nigeria, but highlighted the advantage of engaging with countries like Senegal and Ghana. For years, he has been trying to say that the “lowest hanging fruit” for South Africa can be found in trade with its brothers and sisters in Africa. Every month that passes without intra-Africa trade is one that misses great opportunities.

The African Continental Free Trade Area (AfCFTA) will bring about these opportunities, but there is still a long way to go in terms of border control. What the Department of Home Affairs is doing now about Zimbabwean permits is going to be an issue. The Republic is going to have to work out a system that will monitor how people can effectively come into the country for 90 days, since this will be the standard in the AfCFTA to which South Africa is a signatory. When South Africa signs this agreement alongside West African countries, this could be a barrier if it is not monitored carefully. In the meantime, the Republic should start getting its “feet in the water” and begin trading. Yet, he noted that it sounds like there are positive improvements and products are already coming in. However, a good start would be to launch Trade Fairs, which would open up trade internationally. This would help tourism and stimulate the economy. If this is what DIRCO is busy with at the moment, then he suggested that the money spent on projects with universities abroad could be better spent within South Africa, stimulating the tourism market and getting trade shows off the ground. This would bring countries into southern Africa and show them what it can offer, resulting in deals benefiting South Africa.

Further, he was glad that Ukraine was coming into the equation. He was quite shocked, as was the international community, that South Africa had abstained from the vote. It is now evident why. Yet, he conceded that an abstention is better than voting with Russia while they are trying to work out what the situation is.

Mr Bergman then moved on to the “more sensitive topics”. Unfortunately, it needed to be understood that DIRCO has a responsibility to the people living in South Africa, and their behaviour sets the tone for these people. One of the tones DIRCO has set, as Deputy Minister Botes spoke about on a previous occasion, is one of a proud history of fighting for human rights.
However, DIRCO missed a great opportunity in failing to commemorate Holocaust Memorial Day. It was not Jews alone that suffered in the Holocaust; most people here on this platform would have been victims. DIRCO should have assisted the government in commemorating the people who suffered, so that they do not feel like they were left out in the cold. When it comes to something like human rights, DIRCO needs to have a proud and clear track record, not a bipolar one swinging from left to right. Moreover, there should not be a track record of entrenched past loyalty, but rather one of justice, which is more futuristically focused.

He noted that what Russia is doing has been underestimated. It is trying to dictate new borders for Ukraine, and dictate its North Atlantic Treaty Organisation (NATO) membership. This will impact both Europe and Africa. One day, they could find themselves in a situation where another country is telling South Africa what its borders are, and to what union it may belong. These are the consequences they need to be wary of when South Africa aligns itself to specific incidents.

He referred the Deputy Minister to the ARF presentation on Quarters 1 and 2 the previous week that noted money given to Cuba as a loan. However, the Quarter 3 report labels it as a donation. This is confusing and clarity is needed. Cuba is not in Africa, so it cannot be called the African Renaissance Fund, but rather the “Friends of the Africa Renaissance Fund”. Moreover, if South Africa owes money to the International Monetary Fund (IMF), but is donating money to Cuba, it could be interpreted as an insult to the IMF. They therefore need to be careful how they tread in this situation. In future if South Africa approaches the IMF to ask for money, it could respond that since it can donate money to Cuba – a country in fact sanctioned by the IMF – then South Africa cannot genuinely need money from the IMF. Caution is needed in how donations, gifts and loans are perceived.

Mr Bergman focused on the DIRCO business plan. The Department skirted around the details like it usually does. The report was delivered late, and one would think this was because it had been compiled in great detail. However, this was not the case. He asked for the latest information on the ambassadors – specifically those appointed in the past six months. The Committee knew information already from media reports, but DIRCO did not bring this to this meeting. Members did want to rely on “fairy tales”, but rather on information provided by DIRCO itself. There was no mention of the ambassador to Buenos Aires already facing disciplinary charges, nor that the ambassador to China who could not get security clearance, nor that the ambassador to Kazakhstan will not vacate her post even though she has been given another post. They want the facts from DIRCO, but it is very slow in providing this information. He has been asking for this information since the Q1 report. Now they are doing the Q3 report, and he still does not have the information. He asked the Chairperson to impress upon DIRCO officials that for it to do it oversight job, the Committee needs the information. If DIRCO does not send the right people overseas, it reflects badly on the country and its foreign service. The Committee needs to know that the Minister still has the interests of the country at heart, and that the Committee is not being made a fool and still has an oversight job to do.

He noted the dispute with the City of Tshwane about DIRCO’s failure to pay outstanding water and electricity bills for embassies in the city. This could become a diplomatic spat and DIRCO could fall on its face if it is not sorted out. DIRCO should do everything in its power to meet with the City of Tshwane and sort this out before an embarrassing diplomatic incident puts DIRCO in a bad light.

Ms T Msane (EFF) had asked in previous meetings what discussions were happening between Home Affairs and DIRCO on the Free Movement of Persons Protocol. Currently, AfCFTA is in its implementation stage. This will drastically impact the movement of people withon the continent if not addressed. She asked what engagements there were between Home Affairs and DIRCO, as well as with other SADC countries and the continent. Visas are required for more than 50% of travels on the African continent. However, the time frames given in those countries are not enough.

Ms Msane noted that the AU Programme for Infrastructure Development in Africa (PIDA) has the One-Stop Border Posts programme aimed at eliminating the time goods spend at borders on the African continent. She asked how far along this programme was in implementation, and which South African contractors or companies have been identified for the construction of these One-Stop Border Posts.

Ms Msane highlighted the agreement between Nigeria and South Africa for the implementation of a youth development programme. She requested details on how this would work, what programmes it entailed and how youths participating in the programme would be selected. This is because it had come to light that the implementing agent for a previous project for women was a former First Lady of the state. She found this very unbecoming. Most of these programmes seem to benefit only those youth with access to internet and other privileges, not the real youth of South Africa.

On DIRCO infrastructure, she noted with disappointment that it had been yet another quarter of ICT challenges. The ICT service provider for DIRCO is BT Communications. She asked how much it was being paid each month, for how long it had been the service provider, how much longer DIRCO planned to use its services, and who owned this company. DIRCO was dragging its feet on finding a permanent and legal solution to its ICT problems because a certain individual from this company was personally benefitting. The Committee needs to be furnished with this information as it is becoming a considerable hurdle to deal with this every quarter, with nothing done about it.

In addition, she asked for an up-to-date property asset register of immovable assets. In previous reports the Committee was told that DIRCO was busy with 19 maintenance projects, 10 of which were in Africa. However, they have not seen a report on these projects – how much has been spent on these projects and how far along are they?

Ms Msane declared that the Property Management division of DIRCO does not exist. The Department needs to be honest. The last time the Committee had a report on its Property Management division, it was given the CVs of potential candidates who were completely incompetent to run this division. To date, no such division has been set up. What is DIRCO’s plan about the Property Management division? The Foreign Service Bill was passed so now there is the Foreign Service Act of 2019 that needs to be implemented. However, there seems to be no intention by DIRCO to do so. What does DIRCO really want to do with the properties? It appears that DIRCO wants to maintain the status quo, and not set up this independent property division, despite the Portfolio Committee’s recommendations. As Committee members, they were tired. She suggested that DIRCO perhaps needed to go to the Standing Committee on Public Accounts (SCOPA) since this Committee has been repeatedly lied to and misled.

Ms B Swarts (ANC) noted with frustration how the Committee was sounding like a “broken record”. There was a discrepancy between the DIRCO annual performance plan and its budget. Its spending pattern was not aligned with its deliverables. This time DIRCO linked its reporting to the quarterly targets, but its spending told a different story. To what extent is DIRCO creating a synergy between its operations, and the resources required to achieve its mandate? She could not understand how it could underspend while still achieving its targets – who was fooling who?

Further, she questioned how DIRCO was able to discharge its mandate without deploying ICT, given the challenges alluded to in the financial report. It claimed to have approved a digital strategy currently in implementation. She requested provision of the full information on the root cause of the dismal ICT procurement process. She probed if the Committee should suspect underhand dealing as the primary reason for this procurement failure.

On the Property Management division, Ms Swarts asked what the problem was with the Bid Evaluation Committee. What does this have to do with the property management strategy? The Department still needs to develop a strategy in the first place.

She requested a progress update on the milestone report from the Department of Public Works and Infrastructure (DPWI). After the Foreign Service Act came into place, the Committee a DIRCO report and an ex-official – Ms Bernice Africa – gave a report in March 2020 portraying that DIRCO knew how many assets it owned. But the list was compiled without any facts about the properties such as location, size and condition. The Committee thus rejected this report. At the very least, the Committee expected a milestone report that would show how DIRCO had re-aligned the Property Management division. This was not done.

Further, there had been a request to DIRCO for the CVs to ascertain progress on this new division. However, the CVs received showed candidates unqualified to run a Property Management division. The Committee had already advised DIRCO that to achieve the milestone in property management, it needed the assistance of a service provider, and to remove Property Management from the Finance section of DIRCO. It claimed to have done this, but she guaranteed it had not. The Committee has repeatedly given this advice on the milestone report, but to no avail.

When the Committee did its first oversight of DIRCO, it asked how much rental and maintenance it was paying for the Pan African Parliament building. The Department replied that it did not have that information, but Public Works did. This means that DIRCO is paying DPWI to manage something on its behalf, and it does not understand how it is managed.

Since the Foreign Service Act is not yet in force, how can DIRCO even speak about procurement, while the mandate is still with DPWI? She questioned if the delay in the Act’s enforcement was orchestrated to avoid accountability on this front. This displayed DIRCO's lack of capacity to do its work in general, and it hides behind excuses.

Ms Swarts found it disheartening that DIRCO did not prioritise the promulgation of the Foreign Service Act. Those clauses were urgent and practical, such as the clause on immovable assets. Such a clause should have been promulgated ahead of the rest of the Act, without waiting for the regulations and directives to be finalised, as it has serious and immediate financial implications. This was unacceptable.

DIRCO said that as of 31 December 2021, it had spent only 70% of its budget, It should be spending 25% per quarter if it was really doing its work. Due to a lack of proper planning, it is going to have to accelerate its Q4 performance to spend the remaining 30%. How can DIRCO say that it is achieving its objectives when it has not been spending money? DIRCO was telling the Committee that it could “paint a house before it is built”. She noted with frustration that the Committee was tired of reading reports and documents, and taking the time to do oversight, when their recommendations were never implemented.

Ms Swarts angrily pointed out that what Members are saying in this quarterly review, is what they have been saying since the start of the Sixth Parliament. There are always the same problems. DIRCO’S quality assurance is zero. This was evidenced by the late delivery of the report. The Department does not take the Committee seriously, and it never has. But it faces no consequences. She implored DIRCO, for the sake of South Africans who depend on the work they do, to start doing the right thing. In conclusion, she requested a Committee meeting dealing solely with the ICT challenges.

Mr M Chetty (DA) shared the sentiments of frustration and anger displayed by the other Committee members. This behaviour was something that this Committee has had to endure for ages. The DIRCO officials believe they are a law unto themselves, and not accountable to the Committee.

Mr Chetty directed a question to the Deputy Minister – he was quoted the previous week saying that the R53 million given to Cuba was a loan, but today it was presented as a donation. The Committee needed clarity on this and if the Deputy Minister misled the Committee the previous week, by calling a donation a loan. The Committee was concerned, as was raised earlier by Mr Bergman, that such a donation would cause problems given the R180 million owed to the IMF for vaccines. When was this loan or donation made?

Mr B Nkosi (ANC) noted that the Committee’s reaction to DIRCO’s conduct was now beyond shock and anger, since they had learnt to expect this disappointment from DIRCO.

In terms of reporting requirements, DIRCO knew that it must report to the Portfolio Committee on a quarterly basis. The Committee should not have to remind DIRCO officials, since they have a team which is supposed to liaise with Parliament and meet its reporting obligations on a quarterly basis. It was thus not a valid excuse to say that they were reminded only five days before the deadline. There must be an improvement. It should be evident in the nature of the work of the DIRCO monitoring and evaluation team that it must report to the Portfolio Committee on a quarterly basis.

Mr Nkosi shared Mr Bergman’s optimism on the detailed report on political engagement, promotion of trade, economic diplomacy and tourism. But he wanted to ask if DIRCO had the capacity to monitor all these agreements, including the details on specific sector obligations arising out of those engagements. Does DIRCO have the capacity to enable and implement these agreements? Is there an inter-departmental mechanism to ensure these agreements are translated into concrete programmes for the mutual benefit of the countries involved? Without an enforcement mechanism, DIRCO simply becomes a lobbying agency with no capacity to monitor if agreements are translated into concrete economic programmes.

On the low expenditure, Mr Nkosi agreed that if expenditure was delayed in prior quarters – and was less than the predictable 25% per quarter – then the last quarter would see a mass spike in spending. When faced with this problem, departments tend to spend the money without economic efficiency simply to avoid its return to Treasury. In the Q1 presentation, the Committee warned DIRCO about spiked spending difficulties, due to shifted targets as a result of the pandemic. He asked if, in response to these warnings, concrete plans had been made to ensure that the money would be spent efficiently, effectively and economically in the last quarter.

Mr Nkosi noted that the delays in payment to BT Communications contravened the 30-day payment requirement to service providers. What was the impact of this on service providers, and how would this contribute to expenditure?

Referring to the Audit Action Plan, the report said that it had been sent to Treasury and was being monitored continually. The Committee had previously requested this Audit Action Plan to ascertain progress on the findings of the Auditor-General. He requested that this plan and its progress be shared with the Committee.

Mr T Mpanza (ANC) had not intended to say anything but he had been provoked to speak. He thought that DIRCO should be given the benefit of the doubt that in Q4 they would provide a very much improved presentation addressing all the concerns raised in the previous quarters.

He agreed with Mr Nkosi about quarterly spending and cautioned DIRCO to guard against the tendency, prevalent in almost all government departments, to engage in fiscal dumping.

He seconded the proposal for a Committee meeting solely addressing ICT matters. They needed to spend more time focusing on Programme 1: Administration in which most of the challenges occurred – being ICT, property management, procurement and supply chain. This programme is the backbone of DIRCO. If it is not dealt with, the whole oversight exercise becomes a futile one.

The Chairperson congratulated DIRCO for the relations it has been building across the globe for the benefit of the Republic of South Africa and its people. There are many agreements which are going well, and positive memoranda that have been entered into.

He suggested that the Committee focus on the quantification of agreements. Such quantification is not practice since the PFMA does not require it, so even in the Medium Term Expenditure Framework there is no quantification in some areas. Yet, he believed quantification was necessary to show people that there is value for money, based on what the country invests in international relations. The quantification must show how many agreements have been entered into, with how many countries, and the total monetary value of each agreement. This is necessary to demonstrate the extent to which the country’s international investments have impacted on poverty, inequality and unemployment in percentage terms, as set out in the National Development Programme. If this much money has been invested in these agreements then one needs to see, in tangible terms, the impact on the challenges South Africa faces as a society.

South Africa is doing a lot of work around the maintenance of peace, either through deploying its own forces within the African continent, or through deep diplomatic engagements internationally. Through intelligence work DIRCO should be able to predict what is likely to emerge in particular countries as a result of these efforts. It needs to be demonstrated what possible scenarios or catastrophes have been avoided through this investment of taxpayers’ money. It is necessary to show how the inter-departmental collaboration and engagements have quantitatively contributed. In this way, DIRCO can depend on empirical evidence to inform its reports to Parliament.

The Chairperson also proposed a quantification approach for statesmen. The Department should be able to say that the reason they deployed statesmen in a particular area of work is because of how they are perceived in that particular country. In this way, they can look at South Africa’s status in terms of the global perception graph, and ascertain if it is getting worse or better. Everything revolves around the effective spending of taxpayers’ money. If negative perceptions are not dealt with, it may repel investors or persuade other countries not to politically engage with South Africa. Quantification is essential to have tangible results in the end.

Ministry response
Deputy Minister Botes asserted that the ARF is not an instrument which focuses solely on matters of Pan-African solidarity. It is an instrument at its disposal which, broadly speaking, helps DIRCO deepen its foreign policy implementation.

In terms of Cuba, this decision was made as a result of a foreign policy priority on South-South cooperation and global solidarity. Importantly, he frowned upon statements made by some Members that South Africa has a particular obligation towards institutions on the basis that Cuba is under sanctions. It must be emphasised that Cuba is under unilateral sanctions. This was not endorsed by the UN. In fact, in June 2021, an overwhelming majority in the UN General Assembly voted in favour of lifting the unilateral blockade against Cuba. 184 countries, including South Africa, were against the imposition of this blockade.

On food security for Cuba, the Deputy Minister reminded Members that DIRCO, together with the ARF, has previously made interventions for food security in Zimbabwe and South Sudan. The food security intervention in Cuba was concomitant with DIRCO’s objectives and past actions. In the previous Committee meeting, it was never said that this R50 million contribution was a loan. It must be clarified that this was a committed contribution to intervene in Cuba due to the massive food security challenges it faces. It was a donation – there is no ambiguity.

On Mr Bergman’s concerns on Russia-Ukraine, South Africa’s position is to support the implementation of the Minsk I and Minsk II Agreements, and to call on the full working methodology of the Normandy Format, to bring about the cessation of hostilities between Russia and Ukraine. They must publicly raise this specific matter.

Finally, he commented that ECOWAS is a growing region. For example, three of the countries are in the top 10 performing economies as envisaged for 2022. Thus, DIRCO’s objectives in West Africa are to advance national interests using the pillar of economic diplomacy.

The Deputy Minister passed over to Ambassador Losi, but she was not present on the platform so Ms Lobe took over.

Mr Nkosi interjected, asking why the Acting Director-General was not on the platform. It was unacceptable that she was absent. She was supposed to be driving this process and must answer the questions herself. They simply could not proceed without her; there must be an explanation why she was not leading the team.

Mr Chetty agreed. This behaviour was unacceptable – it was an insult, disrespectful, and it undermined the Chairperson and the Committee.

Ms Swarts wondered how many of their questions, comments and inputs the Acting Director-General had actually heard. As the accounting officer, she was supposed to respond to what Committee members have been asking.

The Chairperson asked the Deputy Minister to contact the ambassador and find an explanation.

The Deputy Minister responded that Ambassador Losi had lost connectivity and was trying to reconnect. She would rejoin the call as soon as she could, but in the interim Ms Lobe and Ms Bhengu would lead the responses.

Department response
Ms Lobe responded to concerns about the youth development and empowerment agreement between South Africa and Nigeria. The agreement was aimed at strengthening people-to-people mechanisms as instruments of diplomacy. DIRCO acknowledged that the youth in these countries were the most resourceful part of the population, and a great asset in terms of nation building, sustainable development, and peace building. The programme aims to invest in youth in terms of skills development and creating access to credit and finance. This objective of economic and financial inclusion is an important element of youth development. Both countries would utilise a programme of youth investment, ensuring that young people could participate in markets not only in South Africa and Nigeria, but also in those throughout the AfCFTA. There was a need to utilise young people as assets for sustainable economic growth and development. DIRCO has identified the need to continually use the agency of youths to deal with the nexus between security and development. President Ramaphosa and President Buhari have agreed that through government efforts, they would forecast on how best to strategise youth development which focuses on young people throughout the continent. Currently, the average population age on the continent is 24 years, while the average leadership age is 64 years. This means that as they proceed, they must look at how to close this generation gap as a means of promoting youth empowerment on the continent.

Further, the two presidents were in agreement on the need to have the Nelson Mandela Annual Youth Dialogue extended to other countries on the continent, not just South Africa and Nigeria. DIRCO was currently working with the Department of Women, Youth and People with Disabilities (DWYPD) to host a Nelson Mandela Youth Dialogue for 2022. This would occur in South Africa in its Youth Month as 16 June is not only Youth Day in South Africa, but also Pan-African Youth Day.

The Chairperson noted the question on the criteria for young people to be identified to be part of this programme.

Ms Lobe replied that in the first preparatory meeting on the Nelson Mandela Youth Dialogue, they agreed that DWYPD, particularly the National Youth Development Agency (NYDA), would coordinate participation in the Dialogue. It was agreed that due to DIRCO’s footprint on the continent, it would liaise with different resident embassies to ensure they assist various youth organisations in delegating youths to participate. Once this was finalised, DIRCO would return to the Committee and report specifically on the established criteria. They acknowledged that not all young people have access to virtual platforms, but the Youth Dialogue would be hosted in South Africa in 2022 as a hybrid session, with some participants being physically present and others online. Further, one of the objectives with this dialogue was to focus on South Africa’s way of doing things – displaying its institutions, frameworks and policies that support the youth development objective, and how it is mainstreamed in government work.

Ambassador Nonceba Losi apologised and confirmed that she had connectivity problems. The Chairperson advised that in future she should send a message to her colleagues so the Committee is aware of the problem. Ambassador Losi apologised again and called on the Head of Internal Audit to continue with the response

Mr Nyameko Goso, DIRCO Chief Director: Internal Audit, stated that the Intra-African Trade Fairs had started. In November 2021, it facilitated the Intra-African Trade Fair in Durban. Working with like-minded organisations, which also facilitate these trade platforms, would be the approach going forward. Some organisations have been suggested already, which DIRCO aims to pursue and support in initiating these efforts. It is true that through these platforms, and the product knowledge they bring, there will be increased trade among countries and businesspeople on the continent.

Ms Bhengu confirmed that BT Communications as the ICT service provider was paid R8.4 million per month for the bandwidth. The contract expired in December 2020, and DIRCO had since paid R105 million from expiry to date. The Department intended to move out of this contract, and the termination process had already been concluded by the Bid Committees that month. The appointment of a new company was currently being recommended to the Acting Director-General. The ownership profile of the company could be sent to the Committee, with the Acting Director-General’s permission.

The Chairperson asked why DIRCO had allowed the contract to lapse. Contracts are predictable; why had they not prepared in advance for this? Why had they not already started the process six months for contract expiry to ensure an immediate replacement?

Mr Nkosi asked if after the contract expired, DIRCO had approached Treasury for permission to extend the contract, and if such permission was granted.

Ms Bhengu explained that when the BT Communications contract expired on 10 December 2020, it was then extended on a month-to-month basis until 10 March 2021. It requested National Treasury permission for these extensions in terms of the PFMA, but Treasury did not grant the extension. This refusal was simply because the initial contract was already regarded as irregular. However, DIRCO needed BT Communications to continue so that it could finalise the bids for the new tender. The Department advertised the bid early in July 2020, but this bid had to be cancelled due to challenges in the terms of reference drafted by DIRCO. It re-advertised in February 2021 and managed to finalise the process up to the stage of evaluation. However, after evaluation, six bids were disqualified from the total received, with the rest failing to meet the stipulated requirements set by DIRCO. The Bid Evaluation Committee therefore recommended that the tender be cancelled again. It re-advertised the bid in April 2021. Ms Bhengu said that she would not go through all the details, but wanted to demonstrate that bid processes were taking place, but several glitches along the way hindered its efforts. The Department was trying to move forward and had the full intention to replace BT Communications as service provider. The process of contract replacement was in its final stages.

There had been progress on the 19 maintenance projects, nine of these projects had been finalised. Ten were still in progress and DIRCO was currently trying to finalise them. On maintenance of missions in Namibia, there were six projects on the list and five had been completed with only one still outstanding. This was beyond DIRCO’s control as it was waiting for the company to deliver the lift that needed to be replaced at the mission. Since then, the mission had also added about four maintenance projects it wanted DIRCO to do. All four had been approved – two were already in a completion stage, and two were still in progress. The Department could also avail reports on these 19 projects.

Ms Bhengu conceded that DIRCO did not have the relevant skilled officials in the Property Management unit when they previously engaged with the Committee. But since then, the candidates had been re-considered, and a Chief Director of Property Management was coming in on 1 March who was qualified for the role. A director was to be interviewed in February, who they believed was qualified to do the work. She asserted that an updated immoveable asset register did exist and would be made available to the Committee.

In December, DIRCO approved an immovable property strategy looking at milestones for work needing to be done. In terms of the Foreign Service Act, this Property Management unit had already dealt with the regulations on immovable property. The unit had also looked at the Foreign Service Code which regulates the operations of the missions abroad. Those chapters on immovable property had been updated in line with the Act. The only problem as noted previously was that Bid Evaluation Committee members did not honour their invitation to meetings. This matter had been escalated to the level of the Acting Director-General. This had now been dealt with and a solution found. Thus, bid evaluations were going forward.

Ms Bhengu responded to Ms Swarts’ questions on the synergy between the operations and spending of DIRCO in Q3. In this regard it had to be said that the spending of DIRCO is 70% administration. The budget relating to core business is primarily for employee compensation. But, the core business expenditure in Q3 was only for state visits taking place in West Africa and Finland. Most of the work done in Q3 did not require DIRCO to spend. The missions have either done their work virtually, or the work does not need budget. The goods and services budget of DIRCO is 70% administration – it is mostly leases for offices, accommodation for heads of missions and staff, foreign municipalities, medical services, and educational services. Core business spending mainly constitutes the compensation of employees, and this compensation budget is too small.

She confirmed that the Department was planning its spending effectively and economically, noting that the spending expected in March was only on ICT goods and services. There had been delays with ICT goods delivery, only arriving in January 2022, and payment would flow out only in February or March 2022. There was also a challenge where the mission expenditure had not been interfacing into the Basic Accounting System (BAS) of DIRCO and this would increase the expenditure of DIRCO. Expenditure of about R14 million for the repatriation of South Africans during the pandemic was only being reported in February and March 2022. This was because in DIRCO was working with South African Airways to reconcile the books and agree on the exact amount owed by DIRCO to the airline.

The final trigger of a spike in expenditure would be the Pan-African Parliament payment for the Close-out Report of work done by DPWI in 2016, 2017 and 2018. DIRCO had discussed this with National Treasury and it agreed DIRCO must reprioritise its budget to pay for this Close-out Report.

Adv Sandea De Wet, Office of the Chief State Law Adviser: International Law, DIRCO, dealt with the questions on DIRCO’s implementation of agreements. For all agreements signed on a particular aspect – for instance on agriculture, water or development – there were specific line function departments responsible for the implementation of these agreements. DIRCO reports to Cabinet twice a year to account for whether agreements are still in existence or not. Work was being done to ensure that agreements are given effect to, not only for DIRCO’s benefit but also for countries on the African continent which can benefit from these agreements. There were a number of agreements that had recently been signed, and it was clear that the line function departments were actioning these agreements. She stressed that DIRCO had been on record in Cabinet indicating that departments should be careful to enter into agreements if it lacked capacity to do so. This would not reflect well on South Africa, and so in such a case it should focus its attention on existing agreements.

Ambassador Losi acknowledged the request on the provision of ambassador appointments, and would take this request to the Ministry. She also undertook to provide an immovable assets register.

She assured the Committee that the dispute with the City of Tshwane had been noted by DIRCO, and they had engaged with the City already. There had been an email from the City’s debt collectors that DIRCO did not owe any amount to the City, and was not in arrears. The Department thus requested the media to retract its statement on DIRCO’s alleged unpaid accounts. However, it had developed working relations with the City, and would continue to engage with them on any amounts owed by embassies, so it could intervene timeously before water and electricity were cut. She noted that DIRCO only pays the rates and taxes for embassies, not their water and electricity bills. She had already requested DIRCO to meet the City officials at least once a month.

Further discussion
In a heated comment, Ms Swarts claimed that the Department still failed to take the Committee seriously. The Committee has continued to appeal to DIRCO to hire a chartered accountant as its CFO. It cannot tell the Committee it has spent 70% of its budget on Administration. This means the Department has not delivered anything – what are they presenting to the Committee? When looking at the alignment of the budget, and the areas in which DIRCO claims to have underspent, how can they say that 70% is spent on Administration?

Further, she questioned why Finance was still reporting on property. The Committee previously said that legally Property Administration and Finance cannot be under one section. The Department has repeatedly told them that the Acting Director-General has since separated the two units. But, a property strategy report has not been given by someone skilled in property management. They must stop playing mind games with the committee. Who has prepared that property report? Who has done the asset register? The Committee has done oversight of all the missions, which showed them buildings that were collapsing and not being maintained.

Information on the 19 properties was supposed to be presented to the Committee in a written report. Now the Committee has been told that the report is ready but has simply not been delivered? This means that in the previous month when they requested the report, DIRCO defied the Committee by not providing it. The Department does not follow time frames.

She implored DIRCO to learn to accept advice, and to accept that the Committee was not the enemy but doing oversight to assist DIRCO to achieve its objectives. However, DIRCO tries to outsmart the Committee with its explanations. The bottom line was that DIRCO was paying an irregular tender, and they have not responded properly to this.

Mr Chetty noted that the Deputy Minister made it very clear that it was a donation to Cuba for food security, despite many on the African continent starving. In today’s presentation it stated that R53 million was given to Cuba. In a 2020 presentation it stipulated a loan amount of R130 million. What was the total amount given to Cuba? What payment has been received from Cuba for the 2020 loan, if any? He appealed to DIRCO to provide straight answers, with no stories.

Ms Msane said that when she joined the Committee in 2019, they were fortunate because they had a member who was part of the Fifth Parliament and who provided the research on the resolutions and achievements of the previous terms. They established that, although they represented different political parties with different visions, they agreed on certain points. The most important of these was that taxpayer money must be used to benefit the country and taxpayers. The Committee did not attack this Department from the start, but it seemed that this Committee was becoming an enemy to DIRCO, which should not be. The challenges should be shared between DIRCO and the Committee, unless DIRCO had ulterior motives apart from servicing and representing the country. The Department’s conduct would perhaps lead to the determination that there were ulterior motives and beneficiaries.

Ms Msane noted that Treasury had not agreed to the R8.4 million paid to BT Communications. However, DIRCO continued to make these monthly payments outside the binding provisions of the law. Further, the DIRCO CFO claimed that the R8.4 million was for bandwidth – how could this amount be paid for bandwidth? Clarity is needed – were they paying for ICT consultation, or simply for bandwidth? It needs to be clear what taxpayers are paying for.

The Committee was also failing. It should have had a list of all the items DIRCO keeps promising them, so that when they come into a meeting, they can ensure that the presentations deal with the relevant issues. She questioned the vague meaning of “final stage” for the 19 maintenance projects. Project management needed to be specific. According to her, as a civil engineer, “final stage” constitutes the handover stage, meaning that the project is 100% complete. Clarity is needed on this. This was further evidence that Property Management must be separated from Finance. The Committee needed a timeline for when it would receive property management reports. The asset register has been requested for months. Why had they not furnished the Committee with the documents requested? Was it because they need to go and “cook” them? R8.4 million for an irregular contract was a lot of money, and it needed to be accounted for.

Finally, Ms Msane referred to a 2021 report stating that DIRCO owed R288 million to the Department of Home Affairs. She asked if this amount had been settled, and in what position this placed DIRCO.

Mr Nkosi suggested that they request the Department in the next meeting to report fully on the status of the BT Communications contract and provide all the required information in response to the questions. DIRCO needed to inform the Committee what disciplinary action had been taken against the Bid Evaluation Committee members whose absence was responsible for the delays in the implementation of the tender and possible wasteful expenditure.

On implementation of the agreements, Mr Nkosi requested a progress report on the International Cooperation, Trade and Security Cluster, chaired by DIRCO, to coordinate trade and industry. Was DIRCO still convening this cluster, how often, and what were the inputs? If noted, he asked why.

Mr Mpanza emphasised the frustration evident in the member inputs. Yet, before the Committee was accused of attacking DIRCO rather than assisting them, he proposed that they have another session where they isolate issues and deal with them in detail. A number of issues had been raised, and through focused meetings they could try to understand why the Committee had been raising these issues for almost three years without any progress. He suggested itemizing issues bothering the Committee, and then having very close sessions with the executive to iron out these issues and find a way to go forward. He was not someone to throw in the towel, but what they as a committee were experiencing was torture, to say the least. Committee members were traumatised, since they had exhausted every option in imploring DIRCO to address these issues. But DIRCO was stubborn. This was very disappointing, and he understood the frustration of the Members. The Department was not taking the Committee seriously. The ship was sinking, and something had to be done to rescue the situation.

Chairperson’s closing remarks
The Chairperson summarised the main points and highlighted the way forward.

• The Department would send documents on the status of the BT Communications contract, and they would have dedicated Committee meeting on the BT Communication contract and ICT issues.

• There would be a report on the action taken about the perpetual absence of some members of the Bid Evaluation Committee.

• A profile on BT Communications would be provided to the Committee, and linked to that would be the financial implications arising from how the contract had been managed. This includes the extension of the agreement, its irregularity, and what Treasury said to Department.

• There would be a monthly update by DIRCO on the appointment of ambassadors.

• There would be a further update on immovables and a resolution taken on the location of those immovables for effective management purposes.

• All details would be provided on the financial implications of the institutionalisation of the Pan-African Parliament.

• They would have a framework for the new financial year, called the Resolutions Tracking and Implementation Framework, which would avoid disagreement on which resolutions were taken, when, and their content. It would manage the tracking of committee resolutions and their progress. This should be a standing item in all meetings.

The Chairperson noted the frustrations of Committee members were understandable. They were not being unfair to DIRCO but simply critical based on historical matters they have been dealing with for months, without progress. A level of turbulence was expected, which would ultimately contribute to qualitative oversight by the Committee.

He reminded Members that there was still an outstanding meeting with the Minister, where they would discuss any other unsettled matters. This was part of the programme for the Committee oversight visit to DIRCO in Pretoria.

He allocated DIRCO 10 days to deliver the requested documents to the Committee. This was a sufficient amount of time, given that these issues had been on the table for some time.

Finally, he stressed that they needed predictability and certainty going forward – a quantitative analysis of impact was vital, despite this not being the standard of reporting.

The Chairperson thanked all Members in attendance. The meeting was adjourned.

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