HIV and Aids (Life Skills Education) Grant Under-spending: National Treasury; Department of Basic Education; Eastern Cape, Limpopo, North West and Western Cape Education Departments: hearings

Meeting report

National Treasury on HIV and AIDS (Life Skills Grant) as at 31 December 2010
Mr Edgar Sishi, Director: Provincial Budget Analysis, National Treasury, gave a presentation on the HIV and AIDS (Life Skills Grant) as at 31 December 2010. The purpose of the grant was explained with reference to the Division of Revenue Bill. The total budget included funds rolled-over by the provinces from the previous year. This was the total amount available for the grant. On aggregate, provinces were expected to overspend on the grant, notably the Eastern Cape was expected to contribute to that projection. However, the spending as at the end of the third quarter was still quite low. Certainly, provinces that were expected to overspend or to break even, which was the majority, were not quite on the way to doing so, as could be seen from the percentages. For example, Gauteng was projected to break even but had spent only just under 28% of the grant. Limpopo had spent only 45.6%. North West had spent 51.5% at the end of December. The Western Cape had spent only 42.8%. The Eastern Cape, which had been projected to overspend, had only spent 56.1%. These percentages called into question the reliability of the projections.

Spending at the end of December 2009 and December 2010 was compared. On aggregate there was no growth in expenditure. There was in fact a 4.3% decline in the rate of expenditure compared to the same period in the previous financial year, notably in the case of the Free State, which declined by 3.3%, Gauteng which declined drastically by 57.1%, KwaZulu-Natal which declined by 15%, Limpopo which declined just by 0.2%, and the Western Cape which declined by just under 15%. There were, of course, some provinces that improved, particularly Mpumalanga, whose spending had improved quite dramatically by about 71.5%. Also Northern Cape had improved by 61.3%. While North West was still struggling overall in percentage terms, with about 51.5%, it had nonetheless improved by 48.6% compared to the same period in the previous financial year. The next slide compared the amount actually transferred to provinces and what they had actually spent. Members would be aware that budgets for conditional grants were split into instalments, usually on a quarterly basis. Sometimes the amounts were very large, such as those for the infrastructure conditional grants. The expenditure was monitored on the basis of the previous transfers. Basically, the biggest issue was the spending lagged behind the availability of the cash. It should be noted that the reason, why the cash was available in the way that it was, was the payment requests from national and the provinces: the challenge was that provinces and national departments requested money at a certain rate, but they did not actually spend money at the same rate as they requested it; in particular, Gauteng, Limpopo, and Western Cape had significant expenditure challenges. Some provinces, such as Mpumalanga and the Northern Cape had significantly improved. Eastern Cape, Gauteng, Limpopo and Western Cape had consistently given projections that they were going to break even, or even overspend, but in fact their figures for spending did not bear out those projections. 

The official information that National Treasury had from provinces was at the end of February 2011, the expenditure with just over one month to go before the end of the financial year was at 65.6%, which was still quite low. It was certainly lower than at the same time in the previous year on aggregate. One could see a minus 6.6% year on year growth of expenditure across the various provinces.

The grant thus continued to underspend in a number of provinces. The biggest improver in the whole country had been Mpumalanga, which had turned itself around quite considerably. In this year it appeared that Mpumalanga would spend everything. The Eastern Cape, however, had spent only 63.5%, with only one month remaining; Gauteng only 39.1%; Limpopo just over 52%; and Western Cape with just 46.7% spent with only one month of the financial year remaining.

The Division of Revenue Act required that the provinces provide not just reports on expenditure but also performance reports on the programmes funded by the grant. National Treasury could provide a copy of such a report.

An issue which occurred repeatedly was that of the training of master trainers. Part of the difficulty was that in the past when one had examined first quarter spending which had traditionally been poor on this grant, provinces would typically say that the reason for that was that the best time that they could do training was during the June/July holidays. However, the numbers did not seem to reflect that this had happened in any case, since even at the end of December spending was still quite poor. 

Provinces raised the public service strike as an issue. The difficulty with the under-spending was that last year there had also been poor expenditure. There was a consistency issue with regard to some of the reasons.

The next set of reasons seemed to be more consistent with what had happened in the past: the delay in the procurement process in provincial departments; there seemed to be some kind of a problem with the management of the process of getting the tenders out; there seemed to be a problem in obtaining the service providers to actually provide these services; things were not being done on time; there was also an issue with respect to delays in the payment of invoices to suppliers – Treasury Regulation 8 required governmental departments and entities to pay invoices within 30 days. However, it was quite clear, and not just in respect to this programme, that a number of provinces struggled to make payments on time to service providers, and this was a serious cause for concern, because of the impact that it had on small businesses and the issue of legal compliance with the regulations. KwaZulu-Natal in particular was highlighted as a province where, for some reason, service providers tended to delay the submission of their invoices.

Problems of performance with the conditional grants were symptoms of deeper problems, and deeper challenges as to management and performance. These were manifest in this programme and in other programmes. 

There was a business plan in process in order to assist provinces to plan how to best spend the money that was being made available to them.

National Treasury was offering training on the business planning tools for conditional grants to provinces and to the national departments in order to assist them improve managing the process.

National Treasury hosted an annual workshop for all the national departments and their provincial counterparts to advise on how to implement the Division of Revenue Act.

National Treasury also had quarterly meetings with the national departments to track the progress of some of these issues.

National Treasury had also done some work in procuring technical specialists and service providers to help specific provinces, for example, the Eastern Cape and Limpopo, in order to improve their processes and internal controls, for example, in supply chain management. However, in the final analysis, it was the people with the authority who must run with the process. If management lacked focus and support, this kind of assistance would not achieve the intended results. This was the message that National Treasury wanted to convey. It was, moreover, disappointing to find that there were cases where an accounting officer had signed a business plan, but it was obvious, from glaring errors in the text, that the officer had not read the plan before signing it. 

Discussion
Mr B Mashile (Mpumalanga, ANC) asked if the money transferred was really spent, and how. Transfers by themselves did not really mean anything.

Mr Mashile asked if a meaningful change was really apparent at community level as a result of the HIV and AIDS (Life Skills Grant).

The Chairperson expected provinces, in their responses, to provide answers.

Mr C de Beer (Northern Cape, ANC) asked what National Treasury did about faults in the provinces' business plans. Did it mark them with a red pen like a test? If this was happening repeatedly, it must be corrected.

Mr Sishi replied that the National Treasury had decided, with the national Department, that, in the future, if business plans were of poor quality, National Treasury would send them back.

Mr Sishi said that National Treasury would continue to make the reports available and indicate the reasons for under-expenditure. It was assisting provinces to improve the quality of their reporting, since it was necessary to acquire a fundamental understanding of the real reasons for underspending. It was not sufficient to report simply that there had been a delay.

Mr De Beer observed, with regard to the research document handed to Members, page 6, that the Northern Cape Provincial Department of Basic Education had failed to submit second and third quarter conditional grant performance reports and had not responded to a letter sent by the Director-General of the Department of Basic Education (DoBE) regarding the issue of non-compliance and offering advice in this regard. Was this the situation? What was being done to correct it? Mr De Beer himself experienced the same problem that officials in the Northern Cape did not respond to letters when he did school visits and sent in issues.

This question was not answered.

Western Cape Education Department. Presentation
Mr Donald Grant, Minister of Education, Western Cape, welcomed the opportunity to report back on the underspending that was reported at the end of the third quarter, to give details of the constraints and why that happened, together with the restorative actions which had taken place, and to give an indication of the summary of expenditure at the end of March 2011, together with the new question that was asked on the quality of the spending.   

Ms Penny Vinjevold, Head of Department, Western Cape Education Department (WCED, the Department), said that it was important to say that, in regard to the underspending which was very accurately represented by Mr Sishi, that the spending was delayed by the resignation of the previous programme manager. Ms Vinjevold accepted responsibility for the fact that the programme manager had not provided sufficient guidance; the plans had been submitted late; and therefore the conditional grant funds were transferred late. The academic catch-up plan had impacted on spending. However, the Western Cape Education Department had moved quickly. It was delighted to have appointed Ms Berenice Daniels, Director: Special Education Services (SES), Western Cape Education Department, to head the special needs directorate and take over the HIV/AIDS grant with a great deal of care. In restoring the situation, the Western Cape Education Department had corrected its procurement procedures and appointed the right people. It had accelerated its LSTM procurement, but it had not done so irresponsibly.

The national Department of Basic Education had assisted the province to ensure that it was compliant.

At the end of March 2011, the Western Cape Education Department was pleased to say that it had spent 95% of the grant; the majority was committed. The Department was now making a concerted effort to ensure that all the things that had not gone well in 2010/11 were corrected; the business plan had been submitted, and Ms Vinjevold had read it. The head of finance had a good reputation: everything was in place to ensure every month there was good, equitable spending, with no need to rush to spend at the end of the financial year. The Minister had asked her to ensure monitoring of expenditure every month.

Ms Vinjevold gave details of what the Department spent the money on. She cautioned about “message fatigue”. The Department believed that it was necessary to reconsider how to make the message powerful through its numeracy, literacy and life-orientation programmes, and not external to what children learnt at school. The Department advocated abstention. It made sure that through its peer education programme children talked about HIV/AIDS to each other, with older children speaking to those in grades 8 and 9. The Department tried to make its schools caring and supportive institutions. The Department monitored its programmes and this is where it was able to detect that the message had become stale and that it was necessary to look at ways to refresh the message. The Department sought to engage young people themselves in leadership positions, teachers and managers in making sure that it got the grant across. The Department also made use of its text books and additional materials to present the message in a “fresh and caring way”.

Discussion
Mr Mashile said that the report indicated an improvement. However, Members wanted the actual progress made and the achievements so that the Select Committee could approve the performance rather than the process planned. Members were already aware of the institutional arrangements.

The Chairperson asked why Ms Vinjevold had to wait to be told by the Member of the Executive Council (MEC) or the Minister to start monitoring on a monthly basis. Was this not an obvious requirement?

Ms Vinjevold replied that it was true that she had received monthly reports on the grant and was monitoring it, but in her performance agreement with the Minister he had asked her to concentrate on particular aspects to make sure that they did not happen again. This was all that she meant when she said that the Minister had asked her to ensure monitoring of expenditure every month.

The Chairperson asked what was meant by irregularly appointed staff members.

Ms Vinjevold replied that programme manager had appointed staff members without reference to the proper procedures.

The Chairperson said that the programme manager had resigned in June, yet it took almost four months to appoint a replacement in such an important and critical post, while, in the meantime, two tranches had been transferred. Why was this?

Ms Vinjevold replied that the resignation had been enforced. The Department of Basic Education (DoBE) would attest that the WCED had appointed a good acting programme manager. The WCED had advertised, as required, and had to search extensively for the right candidate.

The Chairperson asked what the percentage of monies already committed beyond the 95% spent at the end of March was, and for details of how money was spent.

Ms Daniels replied that the WCED had spent it on the following: non-fiction and fiction books on HIV/AIDS and life skills to combat the information overload and fatigue from the regular materials. These had been welcomed by schools. The WCED had also provided first aid kits to schools and refurbished sick bays at schools where there were many children who were ill. The WCED had completed the first phase of the peer education master training. As teenage pregnancies were a huge problem in some years, the WCED had run teenage pregnancy prevention seminars.

The Chairperson said that this kind of information was required in the WCED's report, including the targets set and the achievements thus far.

Minister Grant replied that the Select Committee would receive such a report by Monday, 18 April 2011.

Mr Mashile required that this kind of information form part of the whole report, rather than be provided in a separate report.

Mr Mashile asked for details and statistics on the impact of that programme was at the level of the community.

Mr Mashile asked if the WCED had any particular challenges with their grant, its operation and its effectiveness, and if it would seek the assistance of National Treasury and the national Department to enhance its performance.

Ms Vinjevold replied that the WCED would continue to seek the assistance of National Treasury and the DoBE who had both been very helpful. Members were most welcome to visit the WCED to see the work in progress. Ms Daniels could show them some of the materials that the Department provided.

The Chairperson asked if the money committed formed part of the 95%.

Ms Daniels replied that it formed part of the 95%.

The Chairperson told Minister Grant that the Select Committee deplored any kind of under-expenditure. Members would have hoped that the WCED had spent 100%. The Select Committee was not satisfied with a figure of under-expenditure even of 5% on this grant or on any of the grants. This applied to all the provinces.

A Member said that the departments must take stock early in the year to ensure that they were not under-spending, and supported the Chairperson.

Minister Grant said that the Western Cape had spent 99.3% of the budget for the financial year end. HIV/AIDS was very important to the provincial government. The monitoring and tracking was in terms of results. The WCED was also working transversely and cooperatively with the Ministry of Health, Social Development, and also Community Safety to rid the province of the scourge of HIV and AIDS. It was extremely serious in what it was doing.

North West Province. Department of Education. Report on the under-expenditure of the HIV/AIDS conditional grant for the 3rd quarter of 2010/2011 financial year. Presentation
Mr Bolkanyo Elisha, Member of the Executive Council (MEC), Department of Education, North West Province, referring to the North West Province Department of Education's Life Skills HIV and AIDS Annual Report 2010/11, which had earlier been distributed to Members, reported on the province's under-expenditure as indicated in the presentation document. (Please refer to this for further details.)

The programme Life Skills HIV and AIDS focused on education, HIV and AIDS prevention strategies such as peer education, substance abuse programmes in schools and provision of care and support to infected and affected children. The activities engaged in with regard to the programme were in the business plan and they included advocacy workshop, teacher training, distribution of Learner Teacher Support Material (LTSM), monitoring, support and management.

The expenditure for the Life skills HIV/AIDS conditional grant registered 52% at the end of the third quarter of the previous financial year; however the province instituted remedial processes to ensure satisfactory performance.  The low third quarter expenditure was due to various circumstances. Despite this slow start, the expenditure as at 31 March 2011 peaked at 100%, as shown by the Treasury report for the Department
This was not attributable to the financial year-end rush or the fiscal dumping, as would be demonstrated in the ensuring slides.

Mr Elisha reported on expenditure patterns for the 2009/10 and 2010/11 financial years (slide 4).

Mr Elisha referred in particular to the causes of under performance in the third quarter (slide 5). Public Servants embarked on strike action in August 2010, for the duration of three weeks. Life Skills HIV and AIDS commenced with the HIV Prevention workshops for 713 teachers immediately after the strike action ended on 08 September 2010.

Life Skills HIV and AIDS activities were not conducted as planned in October due to the catch up teaching programmes, which were the priority of the Department after the strike action.

Training of 376 principals, teachers and school governing body (SGB) members started immediately after the writing of examinations (26 -28 November).

First quarter invoices activities were only received from the service provider on 15 December 2010, which resulted in payments being effected in the beginning of the fourth quarter.

The Department has been granted permission by the National Treasury to participate in transversal tenders RT42-2008MF and RT76-2009ME for the procurement of medical supplies (first aid kits top-ups). Control forms (amounting to R 1 143 297) to procure First Aid Kits top-ups were submitted in July 2010.

 All the Companies that were to supply First Aid Items were put on hold by the Provincial Tender Board due to the implementation of the BAS accounting system.

Service Providers were requested to submit required documents in order to be registered on the BAS system; however the Department struggled to get these documents from the Service Providers well in time. Their reason was that they were also struggling to get original Tax Clearance Certificates from the South African Revenue Service (SARS).

This procurement could only be concluded in the fourth quarter.

In line with Department of Basic Education’s nine priorities for Care and Support for Teaching and Learning (CSTL) the department allocated R3 345 000for the purchase supplies for Orphans and Vulnerable Children. These priorities were intended to improve access and retention in schools. Procurement was scheduled for June 2010, but the Service Provider who was allocated the tender failed to deliver on time. Subsequently, the Provincial Treasury granted permission for the Department to effect direct transfers to selected schools to purchase these supplies for the Orphans and Vulnerable children (OVCs). The transfers were actually paid to schools in January 2011. Strict monitoring was conducted to ensure compliance with the terms and conditions of the transfers.

The Service Provider who was awarded the tender to supply the Hygiene Packs for Orphans and Vulnerable Children did not deliver according to the sample submitted to the Bid Evaluation Committee for approval.
The matter was then referred to Department of Education’s Legal Services on the 30 March 2010, to ensure specific compliance by the Service Provider. This breach of specific compliance resulted in a dispute which led to under-expenditure of R 3 707 000in the Life Skills HIV & AIDS Conditional Grant in the 2009/10 financial year.

Hence R 3 707 000 was rolled over to the Life Skills HIV and AIDS conditional grant in September 2010. The rollover increased the allocation from R 12 912 000 to R 16 619 000. The legal process took eight months; the outcome of the proceedings allowed the service provider an opportunity to deliver the correct goods. The new Service Level Agreement with the same service provider was then signed off on the 16 November 2010.

The Service Provider delivered the first consignment on 06 January 2011.

This had the biggest negative impact on expenditure up to the third quarter.

The North West Department of Education’s Finance Section attributed the transport Claims of HIV and AIDS staff to Cost Centre G44( Cost Centre for the Directorate of Curriculum Services) instead of AB4( Cost Centre for the Conditional Grants and Life Skills HIV & AIDS).

The journal entries were effected in March 2011.

The 2010/2011 target for monitoring was 200 schools, but the Department managed to monitor 236 schools.  This was despite the acute staff shortages in the section (only four staff at head office and nine in the districts for all the projects of this programme). Evaluation of the impact of the programme was conducted in 54 schools in the Dr Ruth Segomotsi Mompati District. The other three districts would be evaluated in 2011 and 2012. 

Mr Elisha referred to the lack of transport in a largely rural province. Lack of transport posed a challenge for monitoring. Schools were far apart. Life Orientation officials are mainly concerned with monitoring the Life Orientation subject, which was 100% School Based Assessment of the Curriculum, and could not monitor this programme as well.
Mr Elisha listed the challenges: lack of transport; the short academic year (less than nine months); schools far apart on poor roads (Bad road infrastructure created accessibility problems especially to remote schools); service providers unable to deliver on time or according to specifications; delays with transition to BAS; social problems, e.g. poverty, substance abuse, unemployment and child headed families; and Industrial action by employees jeopardised an already fragile school calendar year.

Mr Elisha detailed the province's responses:
1. Transport shortages: - Officials used their own cars.
2. Monitoring: - Contract staff trained to monitor and support programme.
3. Service providers unable to deliver to specifications: - Since all schools in the province had Section 21 status, direct transfers were made to schools to procure the shoes for learners. A strict monitoring and procurement process was in place.
4.  Poverty, Substance Abuse, Unemployment and child-headed families: - Food gardens functional at 182 schools established with communities to augment school nutrition. Substance abuse prevention programmes reached 557 Grade 10 learners, 877 principals and SGB members trained, 379 home visits conducted, 148 learners returned to school, 3 403 ID documents and 1 017 social grants secured .
6.  Delays with Transition to BAS: - This was a provincial competency, but it had now been completed.
7.  Short Academic Year (Approx 9 months): - All training conducted during weekends/holidays. Monitoring was on-going.
8.  Industrial Action: - Activities planned for earlier in the year as far as possible.

As per the report from the North West Provincial Treasury the Conditional Grant for Life Skills HIV/AIDS, AB4 had spent 100% of the allocated R16 619 000 (i.e. R12 912 000 plus R3 707 000 rollover). Despite above challenges, the Department put measures in place. For the new financial year planning and implementation had been strengthened.  
 
Discussion
Mr M Makhubela (Limpopo, COPE) asked about the issue of roads, lack of transport, the shortage of staff, and the service providers, and hoped that these problems would not occur in future.

Mr Elisha replied that there was cooperation with the provincial department of public works. [Poor audibility impaired reporting of Mr Elisha’s responses.] 

Mr De Beer wanted to make a correlation to assess performance management. How many schools were there in the North West Province? How many schools had been reached in the programme? It was difficult to find the information in the presentation.

Mr De Beer observed that the Department was monitoring 236 schools, but 182 schools had food gardens. However, it was difficult to make a comparison.

Mr De Beer wanted to make a comparison; he asked Mr Elisha to present his information in columns to make it easier for the reader.

Mr De Beer asked if circuit managers had transport in this province which was rural and presented many challenges such as gravel roads. The circuit manager was supposed to visit the schools on a regular basis throughout the year, and could take the other official with him who had business at the school.

Mr Elisha replied that circuit managers did have transport, and he noted the need to optimise the use of such transport.

Mr De Beer observed that the substance abuse programme reached 557 grade 10 learners in the province, but he asked how many learners altogether there were in the province. What about the rest?

Mr De Beer said that he was now been bombarded with documents (by the secretariat, not by the Education Department), and could not be expected to read them all in time to ask all the questions that might arise.

Mr Elisha replied that the Education Department had sent its documents electronically by 12h00 on Monday, 11 April 2011, and had brought with it some extra paper documents in case of need. He could not accept the blame for Mr De Beer's predicament.

Mr De Beer apologised for the misunderstanding. He had not referred to the Education Department in particular when complaining of being inundated with documents.

The Chairperson said that he had been informed that there had been some problems with the province’s network.

Mr Mashile also asked for bench marks. He said that it appeared that there was a challenge as to the programme managers in respect of this grant. There might be good leadership, but there was something wrong with people who were directly concerned with administering the grant. You should not have problems with a shortage of staff and transport when there was actually somebody there to manage. This reflected adversely on management. Moreover, he noted the problems with service providers not supplying according to the specification.

Mr Mashile said that if the Department wanted to be creative in making a list of reasons why it was not able to perform, it would give Members a list of 20 pages. It could definitely find all kinds of excuses. However, it was misusing its time in that kind of activity, because it did not help the Department to perform. All Members required was a list of what the Department needed, rather than excuses. It was important for Members to help the provinces to move forward, and for this Members needed to know exactly where and what the problems were. The excuse that the academic year was only nine months was not acceptable. This had never changed. Moreover, budgeting was over a three year cycle. There must be concentration on performance, rather than justifying why the Department had not performed. 

Mr Elisha appreciated Mr Mashile’s comments, but said that the “excuses” were rather inhibiting factors. The Department had taken remedial action.

Mr S Montshitsi (Gauteng, ANC) observed very little allocated towards training of teachers to take over HIV/AIDS education. There were many projects not directly related to HIV/AIDS. He asked about the spread of funding.

Mr Montshitsi asked how the other sectors were related to education in regards to utilising the HIV / AIDS grant.

Mr Mashile observed that monies had been transferred directly to schools to procure shoes for learners. He asked for clarity. Had this been reported to the National Treasury?

The Chairperson told Mr Elisha that he concurred with Mr Mashile’s observation that the pattern how the Department was spending indicated that there were still some challenges. Some of these challenges were recurring. Hence it was relevant to ask why the Department had decided to renew the contract with the same service provider who had caused delays and the roll-over the previous year. It would seem that the court order had been in favour of the Department. This was why the service provider was forced to deliver the correct goods. Was there also a judgement in terms of costs? If there was, it had to be asked if this judgement was in favour of the Department, and if that service provider had paid legal costs to the Department.

The Chairperson asked if there had been monitoring of the schools to which funds had been transferred directly to ensure that those funds had been used for the intended purposes. How many schools were involved? What implications did this have on contracts that had already been awarded?

Mr Elisha referred to the North West Province Department of Education's Life Skills HIV and AIDS Annual Report 2010/11, page 15. He spoke of the intended impact, and, on page 16, of the collaboration with other stakeholders. The Education Department had terminated the contract as it did not want delay at the level of the schools. No contractor had taken the Education Department to court. The Education Department had, though the court, obtained exactly what it had requested from the service provider concerned.

Mr Elisha said that the North West Province Department of Education and North West Province Treasury were monitoring the programme to ease the problem.

Mr Charles Raseala, Superintendent-General, Department of Education, North West Province, added that the North West Province Department of Education would be happy to supply the report.

The North West Province Department of Education added that it was making some of the posts permanent. It could supply full figures for the previous years.

The North West Province Department of Education said that there were service level agreements with each school. There should be a file per school.

The Chairperson asked how often the Education Department did its reconciliation. How had the money been used?

Mr Mashile said that North West was rolling over a service: the Select Committee disapproved of that.

The Chairperson said that the North West's achievements contradicted its challenges. He asked for clarification. How did North West spend about 48% of its grant in three months? At the end of February it had spent 52%. What had it done to move from 45% at the end of December to 99%? He asked North West to take Members on a journey as to what it had done in the three months. On what was the 33% committed? The North West Education Department should be more “elaborative”. There were incorrect debits.

The Chairperson asked the North West Education Department to go back and verify if the money had been used for the correct purpose. It was clear that there was no certainty that the money had been spent as expected. The Chief Financial Officer could not confirm some of the matters, but a report must be prepared in 14 days.

The Chairperson asked Mr Sishi about the previous year’s submission made by the province on which the Select Committee was concerned that some of the issues were out of line with the conditions and objectives for the grant; the Select Committee had decided that the provincial plan on this particular grant should be sent to Mr Sishi’s office and that National Treasury should confirm that the provincial plan was in fact in line with the objectives of this particular grant. He would ask Mr Sishi to address the Select Committee later about this matter.

Mr Sishi replied that the plan was approved at the level of the national department. He referred to the Key Performance Indicators (KPI) reports.

The Chairperson asked Mr Sishi to please check his records and communicate with the department concerned again so that the Select Committee did not have to refer continually to this matter again.

Limpopo Department of Education
Professor Molefe Ralenala, Chief Director, Limpopo Department of Education, in the presence of Mr Dickson Masemola, MEC, Limpopo Department of Education, briefed the Select Committee with particular reference to teacher development, the wastage in LTSM procurement, the misunderstanding in this regard, because of the branch LTSM committee, and the roll-over of funds which led to the roll-over of services, for which the Department acknowledged responsibility. The General Manager of Finance had been suspended. The Department was now in a position to deal with the wastage. It was an accumulation of what had been happening in the previous months.

Discussion
The Chairperson asked the Department to confirm its figures.

Prof Ralenala said that the figure of R282 million was a typographical error. It was instead R28 million.

The Chairperson said that it could not use the issue of disruption as an excuse. He asked if its achievements were correct.

Prof Ralenala said that the disruption was not in all the districts.

The Chairperson said that the Limpopo Department of Education was in breach of Regulation 8. Why?

The Chairperson said that the Limpopo Department of Education had made orders long before December. Why had it not detected the problems before? What action had it taken? It had applied for a roll-over.

The Chairperson was not impressed with the Limpopo Department of Education's report.

Mr Mashile criticised the Limpopo Department of Education's planning information, as a result of which the staff members were over-achieving their targets.

Prof Ralenala said that there was under-targeting.

Mr Mashile wanted the Department to highlight its use of committed funds.

Mr Mashile said that unpaid invoices attracted interest, with resultant escalation of costs.

Mr B Nguni (Free State, ANC) called for specifics.

The Chairperson rejected the presentation and called for a new report.

Prof Ralenala agreed to prepare a revised report and submit it to the Select Committee.

Eastern Cape Department of Education
The Chairperson said that the Eastern Cape Department of Education was in the intensive care unit (ICU) whereby it was undergoing a Section 100 Intervention.

Mr Mandla Makhuphula MEC, Department of Education, Eastern Cape, referred to assessment of monitoring, capacity, project function, challenges and corrective action. There had been a decrease in the number of schoolgirl pregnancies.

Discussion
Mr Montshitsi asked if there was a plan to improve the schools.

Mr Nguni asked how much the province spent on LTSM.

Mr Nguni asked if there were any problems with service providers.

Mr Makhublea asked about the fourth quarter.

Mr Mazosiwe agreed with the Chairperson about the seriousness of the Section 100 intervention. Money had been spent for other than the intended purpose. He was concerned that the province had spent only 56% of its grant.

Mr Mashile said that some of the numbers were too huge.

Mr Mashile asked if the Section 100 Intervention had impacted on this particular grant.

Mr De Beer asked how many schools were involved.

Mr Mozosiwe asked about the number of targeted schools. Members needed the mandate of that grant.
 
Mr Mashile asked if the national Department of Basic Education was really facilitating provinces to learn from each other.

Mr Montshitsi said that a province should be able to have this kind of information at its finger tips. The more the National Treasury directed the process the better.

Mr De Beer said that there were several universities – Nelson Mandela, Rhodes University, Grahamstown, and Fort Hare -  in the Eastern Cape and wondered if the Eastern Cape Department of Education was making use of these resources in terms of general and financial management and educational issues. It was not necessary to import such expertise from other provinces.

The Chairperson advised the Eastern Cape Department of Education that its report raised many questions, as was the case with Limpopo. The Select Committee would call the Department every quarter until it satisfied the Select Committee that it was spending this grant correctly.

Mr Makhuphula accepted the need for corrections and agreed that some of the figures were not accurate. He conceded that the report was thin and asked for more time to revise it.

The Chairperson agreed and instructed, as with Limpopo, that the Department must rewrite its presentation with corrections, and resubmit it.

The Chairperson said that, in view his decision, the Eastern Cape Department of Education was therefore not expected to answer the Members' questions at this time.

Gauteng
Mr Montshitsi observed that Gauteng was not present.

The Chairperson confirmed the province's absence, without formal apologies, other than a short message service (SMS) text message from the MEC that the province wanted to attend on Thursday, 14 April 2011.

The Chairperson said that Gauteng had performed “very badly on this grant”. Perhaps the Select Committee would call Gauteng to attend when Limpopo and the Eastern Cape reappeared.

Department of Basic Education. Presentation
[Mr Themba Kojana,] Acting Deputy Director-General, Department of Basic Education, said that there was a moratorium on conditional grant activities. National Treasury had been reluctant to grant the roll-over.

In relation to the Department of Basic Education and its function to monitor the implementation of policy to support provinces to adhere to the prescripts of the grant, to ensure the following, as stipulated: training of educators, the place of the programme within the curriculum, the issues of educational activities for learners, capacity building for school management, and provision of support activities, on 24 November 2011 the Department wrote to the provincial heads of department (HODs) bringing to their attention the other expenditure on the HIV/AIDS (Life Skills) programme. The Director-General noted matters that were affecting the different activities and the subsequent public service strike issues. Firstly, it was around the non-approval of activities in the approved business plan; secondly, it was around the delay in the approval of specifications; thirdly the delayed payment of invoices for activities that had been conducted; and lastly, the moratorium on conditional grant related activities. Furthermore, the Director-General in that communiqué expressed the view that the National Treasury was reluctant to grant the roll-over of funds. The Director-General asked the HODs to intervene in ensuring the implementation of facilities and ensuring the conducting of the conditional grant programme. Hence, the Select Committee would note in the reports from provinces that they did indicate that there was a meeting in November 2010 precisely to consider all these matters. The peculiarity of this particular financial year was precisely because of activities such as the World Cup planned by the country. Just subsequent to that there was the protracted public service strike which pushed the priorities of education and caused a reassessment of them to determine what should be the focus in an academic year shortened for practical purposes. The focus inevitably became curricular and ensuring that children passed their examinations.

The very same educators who were of key importance in the curriculum had to focus on teaching and learning.

Discussion
The Chairperson asked the Department to avoid raising issues that could have been challenges. The provinces had spoken for themselves, and their challenges were different from one another. It seemed to the Chairperson that the Department wanted to justify under-expenditure. What ever reasons the Department might give, the Select Committee condemned under-expenditure. Even if the DoBE appeared to be happy at national level with the reasons that the provinces had advanced, the Select Committee was not happy, not withstanding the World Cup and the strike of which Members were well aware. There was no excuse for halting all activities just because of these reasons. The Select Committee would never accept that.

Members indicated agreement.

The Chairperson said, moreover, that the Select Committee had made this clear to all the provinces that had presented. It was quite disappointing to hear the national Department try to justify under-expenditure as well.

The Chairperson asked the Department to respond to the issues raised by Members including the Department's approval of the report that expenditure was not in line with the intended purpose.

The Department apologised. The Department did hold inter-provincial meetings, in which experiences were shared. The Director-General had noted the challenges and had advised the provinces on what ought to be done differently.

The Department had noted at the national level the need to ensure capacity and skills to monitor adequately and provide support to the provinces.

Mr Mozisiwe hoped that the programme manager would give the specifics, as he was worried about glossing over. There was a law that allowed the Department to coordinate issues with provinces. This was the Division of Revenue Act (DoRA). The Select Committee wanted to ascertain what national departments were doing, so that ultimately the Select Committee did not receive the kind of reports that it was now receiving.

Mr P Zulu (IFP) wanted to hear from the national Department if it had a plan to assist the Limpopo and North West provincial departments of education. 

Ms Faith Kumalo, Chief Director: Health in Education, DoBE, referred to the purpose of the grant. (National Treasury presentation, slide 2). She spoke of the competitive advantage that education had with regard to disseminating correct information through the curriculum. The DoBE did this very well. She acknowledged the need to strengthen delivery of life skills in the curriculum, and to monitor and measure delivery better. She spoke of the issue of impact and research was available through collaboration with the Human Sciences Research Council (HSRC). Indeed there was room for improvement. Knowledge levels were high, but the Department was aiming for maximum saturation. It was also important to ensure a caring and supportive environment for children affected by HIV/AIDS. South Africa was one of six countries that were implementing an initiative of the Southern African Development Community (SADC) to ensure that the vulnerable children in particular could enter schools, stay in schools, and achieve in schools. The Department aimed that teachers could identify the particular needs of vulnerable children. At the same time, the Department was not seeking to duplicate the work of the Department of Social Development. Schools were the most numerous public institutions. Therefore the Department was managing the process.

Ms Kumalo referred to the importance of promoting safety for children and preventing harm to them from drug and sexual abuse. The Department had taken a holistic approach and recognised that it was not just a matter of providing information. The factors that drove HIV infection were structural and societal. It was therefore necessary to have an integrated response, and educators must be fully involved in all these areas. The no fees policy and the National School Nutrition Programme (NSNP) decreased the HIV/AIDS risk by bringing children to school and helping them to stay in school. However, more money was needed, However, Ms Kumalo conceded that the Department had failed by not ensured efficient spending, and Ms Kumalo accepted shared responsibility for that

Ms Kumalo appealed that the National Treasury and the Select Committee realise that it must be the DoBE plus others, since the HIV/AIDS epidemic necessitated a more holistic and integrated approach.

The Chairperson agreed with the need for collaboration, but said that expenses were the responsibility of the other departments involved.

Ms Kumalo said that many of the life orientation teachers had already been trained, and the Department was expanding the training.

The Chairperson agreed with Ms Kumalo on most of what she had said, but hoped that the Department's acknowledgement that it had fallen short was not just for the purpose of the meeting.

The Chairperson said that the Select Committee would expect, at the next round of public hearings, some serious improvements in spending on the HIV/AIDS (Life Skills Education) Grant, and that the Minister of Basic Education should attend these hearings.

The meeting adjourned.