DPSA, NSG, CPSI & PSC Audit outcomes & 2019/20 Annual Reports; with Deputy Minister

Public Service and Administration

18 November 2020
Chairperson: Mr T James (ANC)
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Meeting Summary

2019/20 Annual Reports
Tabled Committee Reports

The Auditor-General of South Africa (AGSA) briefed the Committee in a virtual meeting on the audit outcomes of the Department of Public Service and Administration (DPSA), National School of Governance (NSG), the Centre for Public Service Innovation (CPSI), and the Public Service Commission (PSC).

The AGSA reported that all the entities had obtained clean audits in the 2019/20 financial year, except for the NSG Training Trading Account (TTA), which had obtained an unqualified opinion. Its financial statements were free from material errors, but it had struggled in the area of laws and regulations.

A Member asked the AGSA if government departments could give it their action plans, stating how they were going to address the AG’s findings, so they could be brought to the Committee for scrutiny. It was also suggested that the Committee should pay attention to the more operational administrative issues that the Department had committed itself to look at, which were not part of the audit report findings.

The principal of the NSG said the entity had nearly failed to comply, because on the day it was supposed to submit its financials, it had encountered a major cyber-attack. People who wanted a ransom had taken over the NSG server so it did not have access for more than a month, and had to go through emergency procurement arrangements until the server was recovered. One of the targets not achieved was the collection of current debt within 45 days, where 56 days was recorded.

The CPSI had maintained its clean audit outcome in the 2019/20 financial year. Of its eight annual targets, two of those targets, which involved the development and facilitation for replication of two innovative solutions, were not achieved.

The Deputy Minister expressed her excitement that the entities in her portfolio had not only received unqualified audit opinions, but also clean audit opinions. She also drew attention to the fact that the NSG was running an important ground-breaking programme, where politicians were attending induction at the school.

The DPSA had achieved 97% of its targets, with only one target not achieved in the area of policy development, research and analysis.

A Member referred to government employees doing business with the state, and said that last year the Committee had been told it would get a presentation from the South African Police Service regarding this matter, but it had been cancelled twice. She asked when the Committee would be getting this presentation.

The PSC had achieved all of its 21 annual performance plan targets, and for the first time in the last five financial years, had obtained a clean audit outcome. A Member asked about progress on the employee housing scheme, and whether any staff members were taking advantage of it. The PSC was told the Committee was keen to hear the outcome of disciplinary proceedings against its suspended Director General.

Meeting report

Opening remarks

The Chairperson welcomes Members of the Portfolio Committee, the Deputy Minister and the office of the Auditor-General to the meeting. The aim of this meeting was:

-To receive audit outcome reports for the 2019/20 financial year from the Auditor-General of South Africa (AGSA);

-A briefing by the Department of Public Service and Administration (DPSA) and its entities on their annual reports for 2019/20; and

-A briefing from the Public Service Commission (PSC) on the annual report for 2019/20 financial year.

 

AGSA on the audit outcomes for 2019/20

Ms Rabelani Muligwe, Senior Audit Manager: AGSA, said the presentation focused on the completed audits of five auditees, namely, the Department of Public Service and Administration (DPSA) , the Centre for Public Service Innovation (CPSI), National School of Government Training Trading Account (NSG-TTA), the NSG-Vote and Public Service Commission (PSC).

Regarding the audit outcomes of the portfolio over the last five years, in the 2015/16 financial year there were two auditees, the DPSA and the CPSI, that were unqualified with no findings (clean audit) but the PSC, NSG-Vote and NSG-TTA, were financially unqualified with findings. However, in the current 2019/20 financial year, there had been an improvement, with four auditees, the DPSA, CPSI, PSC and NSG-Vote, obtaining a clean audit. Unfortunately, the NSG-TTA had an unqualified opinion, where financial statements were free from material errors but struggled in the area of laws and regulations. The AGSA commended the CPSI and NSG-Vote for retaining their clean audit and the movement of two entities, the DPSA and PSC, to obtain their clean audits. There had been no regression. There had been an improvement in the financial statement preparations, as there were no material adjustments effected to the annual financial statements submitted for audit purposes for all the entities. The AGSA also noted that there were no outstanding audits.

In respect of credible financial reporting, all five auditees had submitted their financial statements by the legislated date of 31 July. This had been the case for the previous financial year in 2018-19 as well. There was an improvement in which all auditees submitted the financial statements without error, compared to only three auditees in the 2018/19 financial year. Lastly, all auditees had submitted quality financial statements, as they were free from material misstatements.

In the previous financial year, only one auditee had submitted performance reports without any errors. In the current financial year, the CPSI, DPSA, and PSC had submitted performance reports without errors. The NSG-Vote and the NSG-TTA had no material findings only because they had corrected all misstatements identified during the audit. All auditees in the current financial year submitted quality performance reports.

Ms Muligwe also mentioned that due to the pandemic, the AGSA had reduced the number of programmes that it had to audit.

None of the entities in the portfolio incurred unauthorised expenditure in the current and previous financial year.

In the current financial year, fruitless and wasteful expenditure incurred by entities amounted to R8 000 which represented non-compliance (DPSA). In the previous financial year, the amount was R10 000. An employee missing a flight due to incorrect names used to book the flight had amounted to R5 000, and the late cancellation of a shuttle service booked for an employee had amounted to R3 000. This expenditure was reported for investigation.

Irregular expenditure decreased over two years, with the amount being R2.56 million in the 2018/19 financial year compared to R687 000 in the current year. This amount resulted from a multi-year contract awarded in 2018/19. The nature of this expenditure was for mandatory information technology (IT) goods/services not procured through the State information Technology Agency (SITA) for the PSC. Any irregular expenditure from previous years was investigated.

According to the root causes (NSG-TTA), there was slow or no response to improving key controls and addressing risk areas. Management (accounting officers and senior management) did not respond with the required urgency to AGSA’s messages about addressing risks and improving internal controls. Management should also prepare regular, accurate and complete performance reports, supported and evidenced by reliable information.

Discussion

Ms M Clarke (DA) thanked the AGSA for the presentation and the recommendations in the report, such as the recording of financial statements, and asked if the departments could give their action plans stating how they were going to address the findings of the AG report and bring them to the Committee so that it could see how each department would address the issues that had been raised. She would like there to be a resolution regarding this.

Ms M Lesoma (ANC) appreciated and applauded the Department and its entities for achieving their clean audit reports. She said she would like the Committee to pay attention to the more operational administrative issues that the Department had committed itself to look at, which were not material to be part of the audit report findings.

Mr Busani Ngcaweni, Principal of the NSG, asked if the NSG could give their presentation first as several of their members had a ‘training of Ministers’ meeting to attend. The Chairperson granted his the request.

National School of Governance (NSG) Annual Report 2019/20

Mr Ngcaweni stated that the AGSA did not mention that the NSG nearly failed to comply, because on the day that the entity was supposed to submit its financials, it had encountered a major cyber-attack. People who wanted a ransom had taken over the NSG server so it did not have access for more than a month, and had to go through emergency procurement arrangements, such as going to SITA and National Treasury, until their server was recovered. When speaking to the late Auditor-General, Mr Kimi Makwetu, about this misfortune, he had stated that as the new principal of the NSG, Mr Ngcaweni should do whatever it took in the next 14 days to reconstruct all the financials and information that had been lost so that his first term was not greeted with a negative audit.

Ms Phindile Mkhwanazi, Chief Financial Officer (CFO), NSG, focused on the executive summary of the presentation, the highlights of the annual performance, and the financial and non-financial performance for 2019/20.

Executive summary

-The presentation provided non-financial performance highlights of the NSG for the 2019/20 financial year, measured against the approved annual performance plan (APP).

-The APP for the 2019/20 financial year had a total of 27 performance targets for both programmes, in which 23 targets were achieved. This translated to an 85% achievement of performance targets.

-With regard to the training targets, the NSG trained a total of 46 378 against an annual target of 53 783, representing an 86% achievement. The annual revenue generation amounted to a total of R150.3 million.

-The TTA closed the year with a surplus of R14 million in 2018/19, and the closing status in 2019/20 was a surplus of R35.2 million.

 

Highlights of annual performance:

-The online programme – Nyukela - went live on 15 July 2019 as a compulsory offering in response to the directive on minimum entry requirements for the senior management service (SMS). Since going live and by the end of the financial year, 161 learners had enrolled and 136 (84%) had completed the programme.

-The Department of Performance Monitoring and Evaluation (DPME) had partnered with the NSG to develop training material for a training course: “Theory of Change for Planning in the public sector.” The training was delivered to a total of 1 706 learners, which included planners, M&E practitioners, internal auditors, financial officials and programme managers.

-The NSG had developed an experiential learning programme to prepare South African public sector managers for site visits at the coalface of service delivery, named Khaedu. Most African countries requested the NSG to train their officials on the same programme, which was then termed “Khaedu Africa”. In this financial year, a total of 100 senior managers -- 25 from four countries -- were trained.

-For the provision of training for mandatory programmes, the NSG had collaborated with the North West Ikatisong School of Governance (ISOG), resulting in the uptake of 1 019 officials to be trained in various programmes before the end of the financial year.

-The Executive Induction Programme (EIP) for Deputy Directo Generals (DDGs) and Director Generals (DGs) took place on 17-19 March 2020, with a total of six delegates from the national Department, Limpopo, the Eastern Cape, KwaZulu-Natal (KZN) and North West. The guest speakers were Adv Thabo Mokoena, DG of the Department of Mineral Resources and Energy (DMRE), and Ms Mpumi Mpofu, Chief Executive Officer (CEO): Airports Company of South Africa (ACSA).

Non-financial performance

Programme 1: targets achieved:

-Clean audit for Vote, and unqualified audit for TTA issued by Auditor- General.

-All suppliers were paid within the prescribed 30 days.

-An amount of R151.3 million in revenue was generated by the end of March 2020.

-Two international exchanges were facilitated with China and France,

-African Union (AU) Agenda 2063 and United Nations (UN) Agenda 2030 seminar, discussing sustainable development goals (SDGs), was held in March 2020.

-The vacancy rate was 8.2% at 31 March 2020

-One case was reported, and the Department undertook all the processes to resolve the case within 60 days.

-NSG service delivery model was developed and approved by the Ministry of Public Service and Administration (MPSA)

-Continuous Disaster Recovery Plan (DRP) tests were conducted and reports developed.

 

Programme 1: Target not achieved:

The NSG had a performance target stating that the average number of days for current debt collection should be at 45 days or less from the date of debt. Unfortunately, it took an average of 56 days for the collection of current debt. The challenges that were faced included an increase in the number of invoices issued towards the end of the financial year. Further, the national lockdown and COVID-19 pandemic had negatively impacted on the NSG’s ability to increase the debt collection.

 

Programme 2: Targets achieved:

-Completed eight research projects to inform training needs and opportunities.

-Completed 13 training needs analysis with public sector institutions.

-Hosted six research colloquia or workshops.

-Submitted six research articles/papers to promote thought leadership.

-Developed an implementation plan.

-Developed and piloted the diagnostic tool for a public service skills database.

-72 evaluations were conducted during the quarter.

-Completed seven application of learning studies progress reports produced for seven identified training programmes.

-Developed six new programmes/courses in line with a curriculum framework.

-Quality assured 13 programmes/ courses by the NSG quality assurance committee

-Offered 27 existing NSG courses for anytime-anywhere online learning

-Facilitated the accreditation process through the application process, coordinated the Public Sector Education and Training Authority (PSETA) annual site monitoring visit for the purpose of determining the NSG compliance to their required standards in relation to accreditation.

-Managed and facilitated the review of the General Manager and Public Service Administrator occupational qualifications with PSETA.

-16 Training of Trainers (ToTs) or Trainer Learners Networks (TLNs) held by the end of the financial year.

-Signed 14 memorandums of agreement (MOAs) with the public sector departments and other organs of the state.

 

Programme 2: Targets not achieved:

-A target was to train 46 783 new and current public servants through face-to-face and online learning, including compulsory induction and cumulative demand-led training. Instead, there were only -41 802 (90%) new and current public servants trained. The effects of the COVID-19 pandemic had significantly impacted on the performance in the last quarter of the financial year.

-Another target was to orientate 3 000 unemployed youth graduates and interns through the Breaking Barriers to Entry (BB2E) programme. Instead, there were 2 189 unemployed youth graduates and interns orientated, which was a 73% achievement. The decision to appoint interns for a 24-month period had limited the intake on theBB2E programme.

-The aim was to train a cumulative 4 000 public servants trained on mandatory courses (cumulative). Instead there were only 2 387 learners trained (60% achievement). The challenge was that there were delays in implementing the mandatory courses.

 

Financial Performance

-In relation to the Vote Account, the total vote expenditure for the annual budget was R187.9 million, with a spending level of 97%. The under-spending amounted to R4.9 million, which was mainly due to vacant posts which had now been filled.

-On the Trade Account, the training revenue had a positive outcome of R1.9 million more than the budgeted amount.

-Non-cash donations for courses at fair value, was R2.2 million.

-The under-spending on compensation of employees was due to vacancies.

-The accounting surplus for the year was R35.2 million.

 

Discussion

Mr Ngcaweni commented on one of the points had been raised by Ms Clarke. On the issues that had been highlighted by the AG, these matters had been attended to. If other authorities were unable to investigate certain issues because it was too costly and there was no evidence, then the entity ought to officially close itself, and the NSG had not done so until currently. The NSG was having difficulty when explaining hindsight. It had two accounts (NSG-TTA and NSG-Vote), and the NSG-Vote had obtained a clean audit from National Treasury. Up to 70% of the NSG budget was self-made, meaning that it had to sell its training and cover the costs, and had to charge fees.

The difficulty was that there had been years under investment, and it should have made sure that the Trade Account ran like a business. The NSG understood the government’s fiscal constraints and would deal with these matters in two ways. Firstly, it would launch bespoke or custom-made programmes so it could charge a premium, resulting in a margin that was one or two percent higher. Secondly, there were possibilities of exploring a debt stream of income by working with development partners. The NSG also had an European Union (EU) arrangement, where the contract would expire in December. Through the Minister, the NSG had made a declaration that it was interested in continuing the development partnership with the EU. Out of this partnership, he believes that the NSG would gain the necessary resources, such as a robust Information Communication Technology (ICT) system to sell products, recover money on time, and run as efficiently as any other business.

In pursuing virtual training, Members needed to note that they could not do some of the free online courses with frontline employees of the State who were at junior levels at government organs, as they may not have access to data or laptops, so the NSG had opted to apply for zero-rating for e-learning products. He believed if the NSG was successful in this aspect, it would be a game-changer for the South African public service, but would also mean that the NSG would need to invest in ICT teaching and learning systems.

Ms Lesoma applauded the NSG for a job well done. She was applauding the entity because in the previous year, when it started administration, it was still speaking about reconfiguration of the NSG in terms of the business portfolio and the general part of it. By the look of things, the NSG had a structured balance without any drastic, tangible, or organisational configurations, and had also been known to hold up the losses, which she really appreciated. In response to the action plans mentioned by Ms Clarke, the NSG would provide them going forward. The Committee was still looking forward to the courses made for Members, as it would empower them to do a more live active oversight. Lastly, she congratulated the NSG for their executive training that was under way and in returning value for money, for better performance for all departments and for fewer departments appearing before Standing Committee on Public Accounts (SCOPA).

Ms C Motsepe (EFF) asked the NSG when the moratorium on the filling of positions would be lifted, to allow for the finalisation of an investigation into the repositioning of the centre.

Mr Ngcaweni said that a few weeks ago, the NSG had concluded a memorandum of understanding between the NSG and Parliament. This memorandum of understanding allowed the NSG to return to the programme that was run where Members of Parliament were offered an opportunity to study for a diploma in public leadership at the University of Witwaterstrand. Members would soon be invited to participate in this programme.

The NSG was expanding the idea of partnering strategically with higher education institutions in SA, depending on the prospects that they had, such as finalising an MOU with the University of Johannesburg. In order to bring some of the prospects into the public service, it partnered with an institution because it had the capacity to do so. As the CFO had indicated, they had MOUs with five other universities in the country and trained public servants, especially those at deputy director and assistant director level, and those who wanted to do management development programmes. In all these programmes, either one got credits to a higher diploma, or a module of any other form of recognition that was offered by the universities. By doing so, questions had been addressed around issues of quality. Equally, the NSG had partnered with institutions globally, and earlier that morning it concluded an MOU with a school of global leadership -- a business school in Arizona, US -- where there was a master’s programme available. The NSG was fundraising aggressively, and the university was already offering a 70% discount on the fees.

Mr Ngcaweni added that the NSG was training Members this week, and had partnered with the Wits School of Government and brought some of the best professors in the country to provide a capacity building programme for members of the executive. Executive Mayors, Ministers and Deputy Ministers, and Members of Executive Councils (MECs) from all parts of the country were participating in this programme.

Next Monday, the NSG would start a new programme on agriculture and COVID alleviation with a university in China through a Zoom meeting. In the next two months, the NSG was starting another programme with Ecole, which was a premier school of public policy in Paris, on the EU Commission. This required the NSG to finalise its organisational review, and there were three things to note. Firstly, it was engaging the realignment of the new NSG structure. Secondly, as the DG of DPSA would indicate, there was work under way to amend the Public Administration Management Act (PAMA), and once this act had been amended, the clause that declared the NSG to be a higher education institution would be amended, and it would remain a government department. No job losses were expected, and in this respect, the future of the NSG required the employment of data analysts or economists so that in future, it could produce reports that were complete with analytics that would state who was attending training at the NSG, and the impact of the programmes that it was conducting. The organisational review should be completed by the end of the month, and the PAMA amendment would ensue at the beginning of January 2021. The NSG wanted to find a mechanism in which some of the programmes it offered were exclusive, because it would guarantee financial sustainability.

Centre for Public Service Innovation (CPSI) Annual Report 2019/20

Ms Lydia Sebokedi, Acting Executive Director, CPSI, said the CPSI had maintained its clean audit outcome in the 2019/20 financial year. In the overview of its performance, two of its eight annual targets had not been achieved.

Targets achieved:

-Four quarterly financial reports were submitted to the MPSA, DPSA and National Treasury and non-financial reports were submitted to the MPSA, DPSA, DPME and National Treasury, as per the required timeframes,

-100% implementation of external audit recommendations.

-Revised Pocket Guide to Innovation in the South African public sector disseminated.

-Six knowledge platforms hosted to unearth, demonstrate, share, encourage and award innovation in the public sector at the annual Public Sector Innovation Conference. Public sector innovation awards involved four sector specific workshops on leading innovation in the public service.

-Volume 10 of “Ideas that Work” and the South African Public Sector Innovation Journal published.

-The CPSI participated in the following Southern African Development Community (SADC) or international innovation programmes: 59th Session of the Organisation for Economic Cooperation and Development (OECD) Public Governance Committee on 15-17 April 2019, in Paris, Continental Africa Public Service Day on 17-24 June 2019, in Kenya, Commonwealth Africa Innovation Accelerator Programme on 24 - 26 June 2019, in the Seychelles and Innovation and Digital Transformation of the Public Sector in France from 20-24 January 2020.

Targets not achieved:

-Two targets in Programme 2 were not fully achieved.

-Two innovative solutions were developed. Consultation on innovative solutions to be developed was held. The deviation from this target was that no new solutions were developed in the period under review. No new solution was taken into a piloting phase due to the longer than anticipated duration of the piloting of the two projects from the previous performance cycles, which demanded the full capacity of the unit.

-Two innovation solutions were facilitated for replication. One innovative solution facilitated for replication was the Maternity Filing Project at Bertha Gxowa Hospital. The deviation from this target was because one innovative solution -- the Standing Boxes -- was not replicated by 31 March 2020. The delivery of the Standing Boxes was not finalised by the end of the financial year due to delays in manufacturing. The Standing Boxes were delivered to the Free State replication site in the 2nd quarter of 2020/21.

 

Highlights for Programme 2

-Replication Programme: This programme successfully replicated the maternal health records project from Prince Mshiyeni Hospital (KZN) to the Bertha Gxowa Hospital (Gauteng).

-Research and Development Projects: Phase One of the Home Affairs real-time service delivery monitoring project was concluded and the CPSI continued to support youth digital skills development through the Hackathons, and partnering with youth organisations such as Geekulcha, an ICT organisation.

-Partnerships and Networks: The CPSI partnered with institutions within the National System of Innovation, such as the Gauteng Innovation Hub, the Technology Innovation Agency and the National Advisory Council on Innovation, amongst others; it ensured a consolidated commitment by frontline departments to leverage innovation as an enabler for improved citizen access to vital government services; the CPSI further maintained strong relations with international organisations such as the OECD and UN, to ensure that South Africa stays on par with global innovation thinking and practices.

-Innovation Knowledge Platforms: the CPSI continued to coordinate robust innovation knowledge platforms as part of its efforts to inculcate the culture and practice of innovation in the public sector. Through these platforms, innovation approaches, solutions and models were shared across all spheres of government to avoid re-inventing the wheel; platforms included the Annual Public Sector Innovation Conference and the Annual Public Sector Innovation Awards Programme.

-Ideas that Work: For the first time, the South African Public Sector Innovation Journal was published online. The journal was an important compendium of information and knowledge on public sector innovation aimed at encouraging learning and sharing of expertise in the public service.

-Public Sector Innovation Workshops: The CPSI conducted a number of innovation workshops in different provinces, to encourage public officials to think and practice innovation in their work in order to solve service delivery challenges.

 

Challenges: ICT capacity remained a challenge, which would be addressed through entering in a revised Memorandum of Understanding on shared services between the DPSA and the CPSI.

Discussion

Ms M Kibi (ANC) thanked the CPSI for the initiative that it had taken to help people not to stand too long in queues when visiting hospitals, for example. If this initiative could be used in other provinces, it would assist a great amount. On the issue of having a fear of one person getting sick, this would be a huge problem, and she asked how it planned to address this. She asked if there were there any challenges regarding the ongoing and new innovations due to ICT. When would the new memorandum of understanding be implemented with the Department regarding shared services?

CPSI’s response

Ms Sebokedi responded that the CPSI would engage with provinces to assist as many hospitals as possible in order to reduce queues. With regard to the issue relating to vacancies and following the review that the Minister would approve, she was hopeful that it would be able to solve some of the challenges it had in terms of vacancies, but as for now, there was not much it could do as it posed a high risk.

She would not like to see the CPSI go back to a qualified audit, because it could not separate the delegation of duties within the organisation. It was also engaging with the SITA to second their solution developers to CPSI, which was still in process. It had also looked at human resources (HR), which had three posts, with one post being at level eight. The CPSI believed that it could take this post to a lower level so that it could create another post to assist in IT. ICT would always remain a challenge, especially in procurement, and it was a serious barrier to the innovation agenda.

On the health solution which used data to produce a care for another person, in order to procure it they would need a tender or issue a request for quotation (RFQ), and there was no guarantee that it would get that solution. The procurement bill was still under review, but it might assist to make sure that as government, it was able to procure IT much more easily and would enable the uptake of this innovation into the public service.

Deputy Minister’s remarks

Ms Sindi Chikunga, Deputy Minister of Public Service and Administration, apologised for arriving late, as she had to attend to an OECD international conference, and the Minister was attending a Cabinet meeting. She said that they both took the meetings regarding annual reports very seriously.

She expressed excitement about all the entities in the Public Service and Administration portfolio, not only for receiving unqualified audit opinions, but also for receiving clean audit opinions. She knew that this took some effort by all in the leadership and management to ensure that this outcome was reached. She was aware of the Trade Account and had been briefed by the Auditor-General about it, and would take measures to ensure that tomorrow they received it. She believed that the Department needed to maintain this achievement so that in future there was no regression of any kind. She was aware of some of the issues that the CPSI was raising about positions and that if they were not filled, they might attract a serious finding from the AG, and that was a matter that would be attended to. She looked forward to another year of success.

She also wanted to note that the NSG was running another important ground-breaking programme, where politicians were attending induction at the schools. This talked to the priority of the country to build a capable, capacitated, ethical and developmental state. This was important, because it meant that everyone was recognised -- it was not only for the portfolio of Public Service, but for every person in South Africa. Even with the DPSA, the Members should expect that it would be talking about a clean audit, which was an unqualified audit without any findings from the AG. She was also excited on the auditing of personal protective equipment (PPE) contracts and tenders, where it had also been given a clean bill.

Despite the difficulties from the pandemic, the Department still tried to do things the right way. It was still engaging on the issue of the Wage Bill, and would not want to pre-empt the outcomes of such negotiations, but they were trying their best to have engagements with the labour unions on issues related to that.

She again apologised for arriving late, as this was one portfolio committee meeting that the Department normally did not want to miss because it was not only accounting for what it had done, but also for the funds and budget that had been approved by Parliament last year.

Department of Public Service and Administration (DPSA) Annual Report 2019/20

Ms Yoliswa Makhasi, Director-General, DPSA, said that she was not going to go in detail on the Department’s achievements in the previous quarter, because she wanted to give an update on progress in some of the key areas that the Committee had been monitoring in the past. For the 2019/20 financial year, the Department had achieved a clean audit opinion.

The DPSA had achieved 97% of its targets with only one target not achieved, which was under Programme 2: Policy Development, Research and Analysis.

Programme 1: Administration

The programme had six annual targets, and all six were achieved:

-The interim and annual financial statements were submitted to National Treasury.

-The bi-annual reports on the compliance with the broad-based black economic empowerment (BBBEE) status level of contributor were completed, as prescribed in the preferential procurement regulations 2017.

-Quarterly reports on the implementation of the APP were submitted to relevant authorities.

-Progress reports on the implementation of the internal audit and risk management plans were submitted, with a specific focus on the audit of human resources, asset management, supply chain management, financial statements and information technology.

-The reports on the DPSA’s compliance to financial management, human resources and labour relations prescripts were submitted. Among the things covered in the reports were areas of compliance such as strategic management, audit and risk management.

-Quarterly reports on the implementation of the Department's bi-lateral and multi-lateral agreements and programmes were submitted.

 

Programme 2: Policy development, research and analysis

The programme had eight annual targets, and achieved seven (87%):

-The institutionalisation of selected aspects towards the draft regulations for the Office of Standards and Compliance (OSC) was conducted through consultations held with national departments. 

-The business case on the structure and governance of the Office of Standards was compiled.

-The report on support provided to departments to improve on areas of non- compliance with public service legislative and regulatory prescripts as identified in the 2017/18 AG’s report was developed.

-The report on the revised public administration performance information areas for inclusion in the annual report format for auditing by the AG was produced.

-The report on the implementation of recommendations made towards the establishment of a national administration to support the Public Administration Management Act was submitted.

-The report on linking organisational productivity assessment with the performance management and development system (PMDS) was compiled.

-The report on the state of readiness of departments to the organisational functionality assessment tool was compiled.   

 

The following annual target was not achieved: Further consultation with selected national and provincial departments towards the legislative drafting of the draft White Paper for the transformation and modernisation of public administration conducted. The reason for non-achievement was that the draft White Paper was not timeously submitted to the MPSA for approval before consultation on the document.

Programme 3: Public service employment & conditions of service

The programme had achieved all seven of its annual targets:

-The report on the average percentage of funded vacant posts on the Personnel Administration System (PERSAL) was submitted.

-Policy implementation support was provided to national departments and provincial administrations on the implementation of the revised SMS PMDS by a national workshop, and nine provincial workshops conducted.

-The report on the graduate recruitment scheme framework was compiled.

-The annual report on the appointment of persons into developmental programmes within the public service was submitted.

-Quarterly analysis reports on the average number of days taken to resolve disciplinary cases and precautionary suspension cases by national and provincial departments were compiled.

-Quarterly reports on the implementation of the Government Employee Housing Scheme (GEHS) were submitted.

-The report on the establishment of the housing finance solution for the GEHS was produced.

 

Programme 4: Government Chief Information Officer

The programme achieved all four of its annual targets:

-The priority e-Government initiatives to support digital transformation for the public administration were submitted by the required deadlines.

-Public service information security standard was submitted as required.

-The revised corporate governance of ICT policy framework was also submitted.

-The report on ICT expenditure by all national and provincial departments in managing the cost related to information technology (IT) procurement within the Public Service indicated that above R40 billion had been spent since 2015- 2018/19 financial years. ICT expenditure in 2018-19 had recorded an increase of 11% compared to the base ICT expenditure of 2017-18.

 

Programme 5: Service delivery support

The programme had achieved all six of its annual targets:

-The report on the implementation of the operations management framework by three prioritised departments -- Human Settlements, Energy and the South African Social Security Agency -- was developed

-The report on the institutionalisation of the framework for the establishment, promotion and maintenance of service centres was submitted by the required deadlines.

-The service delivery model (SDM) for the public service was developed and submitted to the Director-General.

-The report on the assessment of the implementation of the SDIPs by all national and provincial departments was compiled.

-The report on implementation of the Batho Pele standards by all national and provincial departments was submitted.

-The report on the inspections and unannounced visits conducted at service sites was compiled.

 

Programme 6: Governance of public administration

The programme had achieved all four annual targets:

-The proposal on the establishment of the Head of the National Administration and Head of the Public Service was developed.

-The guidelines to support the implementation of the revised Determination on Other Remunerative Work were developed.

-The report on the adherence by public service employees in national and provincial departments to the directive on conducting business with an organ of state was completed.

-The report on the adherence by designated employees from national and provincial departments to the legislative framework regarding the electronic disclosure of financial interests (e-Disclosure system) was submitted.

 

Human resource management (vacancies)

-As at March 2020, the Department had a vacancy rate of 13.4%. The vacancy rate fluctuated as a result of retirement, transfers, resignations, discharged due to ill-health and dismissals.

-In addition, due to the reduction of the compensation budget by the National Treasury, the Department had prioritised fewer posts to be filled.         

-The high vacancy was as a result of the filling of posts being put on hold until the revised structure had been approved

 

Financial information

Mr Masilo Makhura, Chief Financial Officer, DPSA, presented the financial information. He said the total expenditure of all the programmes for the current financial year amounted to R505.5 million. Other financial information included:

-Transfers and Subsidies:  Expenditure as at the end of the financial year amounted to R508.244 million, or 99.9% of the allocated budget of R508.502 million. These were mainly transfers to the National School of Government, the Public Service Commission, and the Centre for Public Service Innovation, as well as transfers to foreign organisations and international organisations. The transfers also included payments made to households in respect of the leave gratuities.

-Payments for Capital Assets: Expenditure as at end of the financial year was R3.262 million, or 71.2% of the allocated budget of R4.579 million.

-30 Days: No payment exceeded the 30 days’ period during the 2019/20 financial year

-Unauthorised expenditure: No unauthorised expenditure was incurred during the 2019/20 financial year.

-Fruitless and wasteful expenditure: No fruitless and wasteful expenditure was incurred during the 2019/20 financial year.

-Irregular expenditure: No irregular and unauthorised expenditure was reported during the 2019/20 financial year.

Discussion

Ms Clarke referred to state employees doing business with the state, and said that last year the Committee was going to get a presentation from the SAPS regarding this matter and it had been cancelled twice. She asked when the Committee would be getting this presentation.

Ms Makhasi responded that she was not aware of this presentation, and suggested that the Committee activate an invitation to the SAPS. The Department would then certainly attend in this regard.

Mr Makhura noted Ms Clarke’s comments on the SAPS presentation, which was supposed to have taken place in the previous quarter. The DPSA would respond to the group on the side for the Committee.

The Chairperson thanked the Department for their presentation, as well as the Deputy Minister.

Public Service Commission (PSC) Annual Report 2019/20

Adv Richard Sizani, Chairperson: PSC, was accompanied by the Acting DG: Ms Irene Mathenjwa, and the CFO: Mr Zweli Momeka. He said there was an Acting DG, as the PSC’s Director-General was still going through a disciplinary process which was being handled by Minister Mchunu. However, the disciplinary process was in its final stages.

Ms Clarke said the PSC should, after having tabled the Report to Parliament, published the results on the state of the public service with regard to the adherence to the Constitutional Values and Principles (CVPs) to the members of the public by utilising platforms such as media conferences and social media as a way of popularising its work.

Summary of performance

Ms Mathenjwa said the PSC had attained all its APP targets in the 2019/20 financial year, with a total of 21 targets achieved. It had also delivered on an additional 78 outputs outside the APP targets which were achieved. Noteworthy outputs would be reflected under the relevant programmes (See document).

Mr Momeka discussed the overall financial performance. In the 2019/20 financial year, the final budget expenditure amounted to R278.2 million. Under-spending amounted to R3.7 million. The reasons for variances included:

-Suppliers’ invoices were delayed due to Covid-19 related complications.

-Some orders could not be paid by suppliers due to Covid-19 related challenges.

-There were SITA-related delays in procuring a new video conference facility. A roll-over request of R2.3 million was submitted to National Treasury for consideration.

For the first time in the last five financial years, the PSC had obtained a clean audit outcome. In this regard, there was no fruitless, wasteful or unauthorised expenditure incurred. None of the procurements during the financial year under review was declared irregular.

Overview of performance information: Targets achieved

 

Programme 1: Administration

-The APP for 2020/21 was tabled in March 2020.

-The PSC had obtained an unqualified audit opinion in July 2019; implemented the audit improvement plan; had a positive outcome of the interim audit on performance information; and a clean audit for the 2019/20 financial year.

-All 3 641 valid invoices were paid within 30 days of receipt.

-The four interim financial statements were submitted to National Treasury quarterly.

-A Section 15 notice was submitted to the Department of Justice and Constitutional Development in March 2020.

-45 out of 78 (58%) BBBEEE suppliers were appointed by March 2020. The APP of 10% was exceeded.

-All four risk management reports were produced.

 

Programme 2: Leadership and management practice

-As at 31 March 2020, 806 grievances were registered, of which 725 (90%) were for levels 2 to 12. Of the 725 cases, 549 (76%) were concluded, of which 460 (84%) were concluded within 30 working days of receipt of all relevant information. The target was exceeded by 4%.

-The 806 cases mentioned above included 81 cases involving SMS members, of which 61 (75%) were concluded, and 56 (92%) within 45 days. The target was exceeded by 12%.

-Two bi-annual reports and one factsheet were produced.

-Two communiqués were produced in September 2019 and March 2020 respectively.

-The report/guide for executive authorities, heads of department, senior management and other staff on prescripts and legislative requirements for the new administration; the report on contract appointments in the Public Service; and the report on the performance of selected departments in the public service, were signed off.

 

Programme 3: Monitoring and evaluation

-A total of 58 engagements were held. The target was exceeded due to invitations, the seizing of opportunities, and requests from stakeholders.

-12 reports on the evaluation of departments were produced.

 

Programme 4: Integrity and anti-corruption

-As at 31 March 2020, there were 315 complaints on the database, of which 225 were finalised and 90 were in progress. Of the 225 finalised, 216 (96%) were finalised within three months of receipt of all relevant documents. The target was exceeded by 26%.

-One factsheet was produced in November 2019.

-All 1 591 National Anti-Corruption Hotline (NACH) cases were referred within seven days of receipt of case reports.

-An overview report was produced in March 2020.

-A report on the “Assessment of professional ethics in the Public Service” was produced in March 2020.

-All 42 employee relations (ER) cases were finalised within 45 days from the date of receipt of all relevant information. The target was exceeded by 10%.

 

Discussion

Ms Lesoma said she had a challenge earlier on when dealing with the DPSA. She requested that in future, the Department should provide the Committee with a picture with regard to progress on the employee housing scheme. Were there any people or staff members taking advantage of the scheme, and would it positively impact on the lives of their workforce in relation to the big project that had been launched by the President?

Secondly, she was not applauding fish for swimming, but wanted to give credit to the DPSA for a job well done and making the Committee proud. She was sure that the DPSA would also share their experience of how they do things with other departments. She requested the DG to share the presentation slides regarding what needed to be done, and also to deal with the issue of public servants dealing with the state. In the near future, the Committee would be waiting with eagerness to see the finalisation of the concurrence of the regulations so that it could also look at the other spheres of government. This would make a difference in the public sector, not only moving towards a single public service, but also in terms of good corporate governance.

There had been no mention of the issue surrounding the suspension of the Director-General, and they would be waiting for the Minister to take the Committee into his confidence at his earliest convenience. The PSC also needed to do more to improve the public perception that might have been created, so that it could lead by example. In the near future, the PSC should come back and report on other areas that had not necessarily been looked at by the Committee. As a result of COVID-19, on site oversight could not be done, but the PSC should consider how they could take advantage of their COVID-19 experience by using technology in other areas.

PSC Response

Mr Sizani welcomed Ms Lesoma’s comments. The PSC had written articles in the papers and were now looking for an expert within the organisation to try and internalise the values and review its systems and processes.

Regarding the webinar, the PSC had been talking to people in Egypt, and most of the NGOs had explained the public service and what it does. More importantly, it had also increased the number of articles in the papers and the issuing of statements. He accepted that this was not the finest moment for the PSC, and was trying to correct this.

Ms Makhasi said that the PSC took cognisance of the issue involving their public image. As indicated, it was also in the process of internally having conversations amongst themselves about the image and posture of everyone within the Commission, and also at the level of the office.

On reporting back to the Committee, the PSC would package a couple of things, including the report on the scrutiny of the financial disclosures. It would also be looking into the use of technology to advance their work, and had already started with video conferencing, but this was more for the PSC’s internal communications.

Ms Makhasi responds to Ms Lesoma regarding the slides. From the PSC side, when doing the scrutiny, it would look at various areas such as assets, directorships, and the central supply database as well. After this, it scrutinises the information to see whether it picks up potential conflicts of interest, or actual conflicts of interest. The Commission would then write to the Executive Authority, outlining all officials that would be implicated in a particular department. Written warnings were being issued, and disciplinary issues were being executed where an actual conflict of interest was picked up. This was how the Commission was raising the matter of potential or actual conflict of interest when people were doing business with the State.

The Chairperson thanked the Deputy Minister and the Chairperson of the PSC for the presentation.

The meeting was adjourned

 

 

 

 

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