Tourism Infrastructure Projects & DBSA MOU; with Deputy Minister

Meeting report

Ms T Mahambehlala (ANC) welcomed the Deputy Minister of Tourism. She asked Ms Gomba to be Acting Chairperson as she had been called to an urgent meeting with the ANC Chief Whip.

Deputy Minister opening remarks
Deputy Minister of Tourism, Fish Mahlalela, recalled that the Department had been historically implementing infrastructure projects, starting from when it was the Department of Environmental Affairs and Tourism, which was then split into separate departments. Tourism-related infrastructure projects remained with NDT. The implementation of infrastructure projects had been a mixed bag of challenges and success based on the audit outcome of 2017/2018. This reflected huge discrepancies in how projects were being implemented, leading to the appointment of the Government Technical Advisory Centre (GTAC) to assess the implementation of the infrastructure projects. The conclusion was that the department needed an agent to assist it in the implementation of projects for them to be successful. This was why NDT entered into the MOU/MOA with DBSA. The DBSA is primarily a development finance institution that focuses on the delivery of infrastructure.

Tourism Infrastructure Projects: NDT/ DBSA Report
Mr Victor Tharage, NDT Director-General, explained that NDT would provide a broad context, and DBSA would give a practical understanding of project implementation.

Mr Thulani Nxumalo, DBSA Acting Programme Manager, said the MOA was entered into between NDT and DBSA in November 2020 and may be amended from time to time. This programme entails the implementation of infrastructure build and maintenance projects allocated to DBSA by NDT for the 2020/21 to 2022/23 financial years.

The purpose of the MOA is to communicate information and update the status quo of the infrastructure projects on the Programme. DBSA intended to deliver the objectives outcomes successfully together with NDT. Project Management and delivery would be according to the Framework for Infrastructure Delivery & Procurement Management (FIDPM).

Mr Nxumalo discussed the project management processes according to the FIDPM which ensured implementation of the works DBSA had been appointed for. The achievement of the programme was expected to result in job growth, economic growth and shared value. The scope of work and current progress of the programme were relayed to the Committee (see document).

Ms Shamilla Chettiar, NDT Deputy Director-General: Destination Development, gave background to the MOA with DBSA. NDT had implemented infrastructure projects with mixed success. There had been several evaluations of infrastructure projects funded through the Expanded Public Works Programme (EPWP). The most recent evaluation by GTAC of 2017/18 performance had recommended a change in the implementing model.

The MOA with DBSA came into effect on 20 November 2020 and will terminate on 31 March 2023. The agreement could be extended by agreement and in writing by the parties. DBSA was appointed as an implementing agent of the Department. She discussed why NDT was focusing on destination development and the state's role in this. The reason DBSA was chosen as an agent of implementation was that DBSA provided extensive relationships with built environment professional associations and it had experience in the development of project management capacity.

She touched on the scope and the application of the MOA and noted NDT was using an Asset-Based Community Development Approach in the programme. She explained the roles and responsibilities of those involved; governance; sustainability of projects and operational support.

Discussion
Ms H Winkler (DA) asked if contractors do not complete projects on time or display poor quality workmanship, what consequences will be taken to recoup the funds or appoint new contractors. Were there deadlines in the service contracts to ensure the schedule was kept to? Once a project was completed and handover took place, was there to be a programme for community stakeholders on how to sustainably operate the projects?

Since the MOA expired in 2023, had they considered potential delays in project implementation? Even though they had included extension clauses in the MOA, what was going to happen when they experienced delays? On the challenges experienced by communities, such as the Ngove Lodge in Limpopo, would the asset-based community development model be able to deal with historical community challenges?

She asked for the number of projects DBSA had identified where the original concept and ideas of the communities were changed by the Department of Tourism.

Ms S Xego (ANC) welcomed the involvement of DBSA. It was a good response by the Department to have involved DBSA as it had brought in people with expertise in the built environment.

Given the involvement of DBSA as a government entity, she wished it did not end with the project handover to the communities. There should be a social facilitation process where DBSA assists communities where there was stability to write recommendations on behalf of the project should loans be needed from the bank to assist communities with the project.

Ms Xego referred to the Treasury communication about halting tenders due to the preferential procurement regulations court case. DBSA had been contracted for three years and delays could happen. She was not making any recommendations but merely drawing attention to the 2023 timeframe as some of the projects were still at a design stage.

She asked how the agreement was serviced as no financial costs were highlighted in the presentation. Since the Committee was doing oversight, it was interested in the financial implications. They needed to be told if the agreement had a grant and if it had financial implications. Were the funds transferred to DBSA? Who was paying whom? What were the financial costs of the 78 projects? If that information was not readily available at the meeting, NDT needed to be ready to present the information in future.

Ms Xego asked who was responsible for the project proposal, design, plans, and who identified the scope of the work. She wanted to understand who did what between NDT and DBSA. She asked more about the financial costs and the type of MOA. The presentation noted the Mnisi resort project had been formally cancelled. Why was it cancelled since it was already included in the projects? Was there no design? Was it because of financial challenges?

Ms P Mpushe (ANC) appreciated the work done so far. As raised by Ms Xego, what was the total value of all the projects? She was interested in the value of each, especially Ngove Lodge. She was shocked that R30 million was needed to refurbish the Ngove Lodge project. She asked DBSA to give the Committee assurance that it had the requisite capacity to deliver on the MOA given that there were 78 projects that needed to be implemented simultaneously.

Ms Mpushe asked if DBSA had experienced any internal supply chain management capacity constraints. Were there any other challenges DBSA was facing apart from the Treasury tender moratorium? Given the challenges experienced by the community at Ngove Lodge in Limpopo, would the asset-based community development model be able to deal with the historical community challenges? There were others like Ngove Lodge. Since DBSA was preparing design development and documentation which is work in progress, did this mean that it had engaged the community on this during its visit? This is to ensure the community has a sense of ownership of the development project.

She asked NDT if there was any intention to enhance its internal capacity to be able to implement infrastructure projects post-DBSA MOU. She also raised consequence management for contractors that did not complete their work. She asked the Deputy Minister if there have been improvements since the MOU with DBSA. She asked if there had been engagement with Treasury on the tender moratorium.

Ms Mpushe noted the Mnisi Resort in Mpumalanga was withdrawn and asked for the reason.

Mr M De Freitas (DA) asked since 78 different projects were taking place simultaneously, how was each project's progress monitored to ensure deadlines were met. Was there a method for how the projects were monitored? As there were different service providers for each project, how were the service providers chosen, and did each project go out to tender? He asked how the projects were identified and noted that there were game farms and lodges amongst these. Were all the projects owned by government or were there also private projects? If there were private projects, why was government getting involved?

Mr De Freitas noted that most projects were still in the concept design phase and it was June 2022. Would it be realistic to say the projects would be completed by 31 March 2023? Or will some projects be completed and others not? He asked for more about the contracts themselves. Were there penalty clauses should deadlines not be met or the budget exceeded?

Ms L Makhubela-Mashele (ANC) appreciated the presentation. She asked how the funds for the projects would be transferred to the implementing agency. Would NDT pay the contractors or would there be a budget transfer to DBSA to pay the contractors? Ms Chettiar had said that there were projects where communities were involved and took ownership. This made it easy for NDT to work with these communities and ensure the infrastructure was well maintained. But what about communities that do not want to take ownership, such as Ngove Lodge, which often causes theft, vandalism and the dilapidation of infrastructure. What systems were in place to ensure that communities fully participated in the project's implementation. They had invested over R30 million to date. This was going to waste because there was no community participation and the community did not want the project. How does one avoid a repetition of Ngove Lodge where resources were wasted and the infrastructure was deteriorating?

Ms Mpushe asked if NDT had quantified the losses at Ngove Lodge from theft? Had anyone been charged with theft and had anything been recovered?

Ms M Gomba (ANC), Acting Chairperson, asked if Phiphidi Falls, which the Committee had recently visited, formed part of the 78 projects. Was there any community involvement in the projects? It seemed that some of the projects had happened without proper consultation with the community. These communities end up not taking responsibility for the project in which government had invested a lot of funds.

Ms Gomba asked about the overall expenditure for the projects as no mention was made about funds for the 78 projects. There was no transparency about the funding. She was happy that all 78 projects were identified in the presentation so the Committee could play its oversight role and ensure that what was presented would be implemented.

Who was supposed to receive the handover and the occupancy certificate for the community project? There was often a misunderstanding between NDT and the community when it came to the handover of the project. She was worried that if there was a challenge with the handover, it meant there would be a challenge in the maintenance plan going forward. Such misunderstandings showed that the maintenance plan was not in place and the community would not be ready to receive the projects and take over. It was important for NDT to explain the maintenance plan. What was the maintenance status quo when it came to those community projects?

Ms Gomba had a question about the Preferential Procurement Regulations (PPR). She had heard that DBSA was requested to remove the 2017 projects and asked why the projects had to be removed from the plan. Who would be audited by the Auditor-General for the programme budget – which was not presented to the Committee. It was important for the Committee to understand who was reporting to whom. Museums fell under the Department of Arts and Culture but there was mention that they would fall under the same construction work that was going to be done for the Department of Tourism. Which department was funding the renovation of museums? If there were problems with the expenditure and implementation, who was going to be held responsible and accountable between the three?

Deputy Minister response
Deputy Minister Mahlalela wanted to give clarity on the financial aspect. NDT is making the presentation based on the request sent to NDT and DBSA by the Committee, which was specific on what needed to be reported. The presentation was responding to the correspondence and this excluded financial explanations. He reminded the Committee that last month they presented the Annual Performance Plan (APP) which had listed all 78 projects and the budget allocation for each. The Committee went through the APP and there was the Budget Debate on it.

All the financial information was available in the hands of the Portfolio Committee, based on the APP. The projects were not outside the APP but were presented in the APP and the Committee had agreed to the projects. NDT would come to the Committee each quarter with the progress report. This would indicate the milestones made in the implementation of each project. This would enable NDT to be held accountable for the progress made.

The second issue he wanted to clarify was the categorising of the projects. Some historical projects dated back to when the Department of Tourism was combined with Environmental Affairs. They explained the historical challenges around those projects. Through the GTAC investigation, it was established that these were not desirable. This was because no due process was undertaken in the way the projects were conceptualised which led to them not being feasible.

Some of the projects were feasible for something else other than tourism. He recalled that this had been explained in the March meeting when they presented the challenges of some of the historical projects which were inherited and the new process undertaken to address the historical challenges. NDT was the owner of the project and was accountable to Parliament. NDT presented the budget to Parliament and the approved budget would be allocated to NDT and not DBSA.

DBSA response
Mr Nxumalo replied about consequence management and contractors failing to complete the work. In all DBSA contracts with contractors, there are penalty clauses should a contractor fail to complete work on the date given with a monetary penalty stipulated. DBSA had a ten percent guarantee which contractors needed to submit upfront before the work could begin. This guarantee would be kept where contractors failed to complete the work so it could be used to complete the work with other contractors. They always had a way in which funds could be recovered. A portion of the contractor invoice was deducted each month and this retention amount was kept aside. They had the retention, the guarantee, and penalty clauses stipulated in the contracts should a contractor fail to complete the required work.

On DBSA involvement in projects where changes were made to what the community wanted, an answer was already given. DBSA was engaged to continue to implement the works that had a specific scope. DBSA did sit down with the communities and the reserves. The scope would not be implemented without discussions happening. Some discussions were still ongoing. Some suggestions were not feasible for tourism or would not assist the facilities or were costly in rehabilitating the facilities.

On the timeframe of the MOA, NDT would be able to assist with that question. There was a clause in the MOA which stipulated an extension. There were multi-year projects, with those they were looking at fitting in within six to eight months. DBSA and NDT had about 40 projects which were maintenance projects and they would take about three months. An extension could be granted depending on the communications DBSA and NDT would continue having. He assured the Committee that all the projects would be implemented accordingly as per the scope concluded and signed between DBSA and NDT. They were putting all their resources into the work. In as much as they had 78 projects, DBSA had contracted professional service providers who were managing implementation of the projects. The appointment of the service providers was done through a tendering process and had been appointed according to procurement policy. They would add to the internal capacity DBSA already had.

Ms Gomba, Acting Chairperson, said she was concerned about the audit. If the tranche was going to DBSA to implement, how were the Committee going to monitor the procurement process? It was the Committee’s duty to ensure state funds were used properly and to check if policies and plans were implemented according to government regulations. If DBSA was not going to account to the Portfolio Committee, but account to NDT, the Committee needed assurance it would see the audit done on DBSA, its procurement and spending of the budget.

She was very worried how the question was replied to lightly It was not a question to be answered lightly. This money was going to be spent by DBSA on behalf of NDT and the Committee needed to have insight into how the funds were spent and what processes were followed. She wanted both DBSA and NDT to respond to the question given that they were funds for the Department of Tourism.

Mr Nxumalo replied that DBSA was part of government and was guided by the Public Finance Management Act (PFMA), the Preferential Procurement Policy Framework Act (PPPFA) and regulations. DBSA was audited by the Auditor-General, even in cases where they worked for other departments, that work would get audited by the AG. DBSA and NDT were open to auditing and to answer any questions when called upon.

Deputy Minister Mahlalela wanted to allay the Chairperson's fear. DBSA was a government entity and they had appointed DBSA as an implementing agent which was normal in government. He gave the example of police stations and courts which were not built by the South African police or the Department of Justice. There was an implementing agent, which would be Public Works, but the budget would not be with Public Works but would instead be with the departments concerned. Similarly, DBSA was an implementing agent, implementing projects on behalf of NDT. Since DBSA is a public entity, it follows the same requirements such as the PFMA and Treasury regulations as Public Works does. GTAC and the AG recommended NDT have an implementing agent as it had capacities that NDT did not have. However, accountability remained with NDT. The Department had the overall responsibility to ensure that DBSA performed as required.

He noted in the presentation that DBSA had explained how the procurement process was done and the role NDT played in ensuring procurement policies were met. NDT was responsible for ensuring all transformative agendas, inclusivity and community involvement and participation were taken into consideration. They had a team that ensured this was adhered to. He assured the Committee that it would be informed if it needed information from NDT or DBSA.

In response to the Acting Chairperson asking who would respond to why the 2017 projects had to be removed, the Deputy Minister said that NDT would deal with that question.

Mr Tharage said that his team was not sure which 2017 projects were being referred to. He asked for clarity about the projects so they could respond.

The Acting Chairperson explained she raised this because Mr Nxumalo had mentioned that NDT had requested not to include the 2017 projects and to remove them from the "PPR".

Mr Nxumalo explained that he was referring to the 2017 Preferential Procurement Regulations of 2017. When National Treasury sent out the moratorium circular to suspend all tenders this year, DBSA had requested an exemption so that it could continue with tenders. DBSA received approval which had conditions where they were told to remove all the PPR of 2017. New correspondence came in the previous week that advised that all the PPR of 2017 were valid and could be included in all tenders going out. That might have been where he and the Chairperson might have missed each other. It was about the Preferential Procurement Regulations of 2017.

The Deputy Minister added that the Preferential Procurement Regulations of 2017 were set aside by the court in February. Treasury communicated that due to the court’s outcome, procurement could not proceed within the context of the 2017 PPR. Treasury had misinterpreted the court, thinking that they had to stop procurement. Treasury has issued a correction stating they could proceed with the PPR of 2017 as is until further notice.

The Acting Chairperson thanked them for the explanation.

NDT response
Director-General Tharage replied that there was a provision in the MOA with DBSA which was an extension clause negotiated with Treasury, in anticipation that projects could face challenges in their execution. They needed to ensure they made provision for this.

The audit question had been adequately replied to. He added that the AG looks at the practices of the appointed agent and if the agent was living up to PFMA requirements. On how NDT monitored progress, the DDG had spoken about the technical committee that met on a fortnightly basis which would feed on to a Committee that met monthly which he chaired. This Committee went through all these matters. DBSA was finalizing a system to allow NDT to have real time data about projects on the ground. This would provide more information on the sites and where they were in contract payments and other aspects.

Mr Tharage explained that this was a commercial agreement between DBSA and NDT. DBSA did this for a fee, which NDT would ensure was paid considering the work that DBSA was doing. The fee depended on the size of the project. If a project was small, the fee would be higher and if it was big, the fee would be lower, ranging from 6.5% to 9% of the project value. Based on the previous trends where projects had failed, the fee was comparatively low when they looked at what was charged for some of those projects.

The Mnisi project was on their books and was a project they had intended to complete. There was a parallel process where the community had decided to engage a private company so that it could be a joint venture. When it becomes a joint venture with private content, it disables government from building a project and giving it into the hands of a private company. The purpose was for the community to approach a commercial bank and development finance institutions to fund the completion of the project. The community was able to secure the funds and the project was still proceeding without government. NDT had done the handover paperwork even though they were prepared to continue with the community. Since the community did not want to continue without the private partner, NDT could no longer be involved because the rules did not allow it to give funding to private individuals.

On the identification of projects, the Deputy Minister had already highlighted that most of them were historical. The projects were identified in collaboration with the provinces. They recently had a Tourism Indaba where a report like this one presented today was shared to keep communities updated. The Department had to go through an intense discussion with these communities, which the Director-General had visited to discuss the projects. There were some instances where requests made could not be fulfilled from a financial point of view. That was where they had to do more development facilitation to ensure that they would be able to reconcile. The Department had a lot of pressure from the communities. He had received a letter from a municipal manager where community members asked the specific amount that a particular project was going to cost. It was a strange request because NDT had already clarified that it could not inform communities of the exact amount for the project as this could circumvent the bid process. They needed to protect that information so that there could be a process of competitive bidding.

Mr Tharage said that the DDG would reply about the Ngove thefts as she had been on site with the Committee. NDT was looking into how to get sustainability. They experienced problems where beneficiaries were taken through an assisted programme of securing the services of someone to run the completed facility. They found that the community wanted a certain person and not necessarily wanted to follow due procurement process. Once this happened, government could no longer be involved. The DDG would speak more on how it would overcome these challenges.

On the projects that were part of the Department of Sports, Arts and Culture (DSAC), all the projects were in the context of ensuring they dealt with destination development. As policy, DSAC had announced that it was pursuing the development of the liberation heritage route. The development of this route was in part the responsibility of the Department of Tourism. It looked at the numbers that were coming to the place and what they were coming there for. For example, in the amaHlubi area in KwaZulu-Natal, they found traffic was coming on the basis that it was a historical place in the history of the British and Zulu people. A lot of people were coming from the UK and made this destination a part of their itinerary. This included the battlefields. It was in their best interest to ensure that iconic products serving as the best attractions were well kept. This was why it was part of Tourism budget vote.

Ms Chettiar replied about how they worked with communities to ensure that they took ownership of the projects once a project was completed. Projects initiated were often not NDT's idea but were instead historical ideas. The projects were submitted to the then Department of Environmental Affairs and Tourism and had the involvement of the province working with the communities. These were ideas from the community and were not imposed on the community.

Every project had a steering committee of which the community was a central part. The department brought in the provincial and local governments. This would ensure that the departments important for the success of the project are involved in the project steering committee. It was comprised of representatives from NDT as well as DBSA, along with contractors or the professional services team. The steering committees meet monthly or more frequently depending on the stage of the project. Where consultations were taking place, there would be more meetings. Once the project begins, the meetings happen monthly to monitor the progress.

Ms Chettiar said there were two elements to the work of the project steering committee. One was to monitor the actual construction of the project to ensure it was on track and the other was to address the long-term sustainability of the project and how they work together with the owning entity and other agencies that might be able to assist NDT in bringing the skills that they require. For example, in the KwaZulu Natal projects, the community was an owning entity. What they did was to work with the community and bring in legal support to ensure the trust was properly constituted and they had proper consultation on how the project would be run beyond completion. They supported the community in electing the trust that would manage the project. They needed to support the community to look at how they would run the long-term operations, on governance processes or even selecting an operator.

Each project was unique, and government needed to run open processes. In some instances, the owning entity preferred to run the process themselves because of a particular operator they already have in mind that they want to work with. They allow the owning entities to dictate how and what the nature of support they require from government, which can be governance training or long-term sustainability. For each project, there was a team that would work on long term sustainability with the community owning the entity. Within this process, operational funding and long-term maintenance are looked at. Once project was handed over, it was very clear to the owning entity what responsibilities it was taking on.

Ms Chettiar stressed that NDT did not impose concepts on communities. The projects and ideas came from the communities, and NDT works with the communities. Even within that space, some negotiations would take place between NDT and the communities. The department would like to lead projects like Phiphidi Falls, that are operational and well run so that they do not burden communities. The department and the communities did not always agree; however, there was a healthy relationship between the two. It was one based on honesty, trust and open communication.

There has been vandalism at the Ngove Lodge project, and those instances are reported to the police where a docket is opened and SAPs investigates the theft. Quantifying what was stolen would be provided in the case report. The department has a record of all the case numbers and receives feedback on matters from law enforcement.

The Ngove project was an unfortunate circumstance. It was important to say that when the Hosi provides feedback on the history of the project, the community had hoped to have a project in the mountains. What they realized once the planning started, was that if they were to continue with the project in the mountains it would cost a lot of money for bulk services and geo-technical work. The community decided to move the project to where it is located given that the funding would not be able to support the project it envisioned in 2003. This caused them to move the project to the current site. The Ngove Project was not something forced on the community and the DG, herself and the previous DDG did engage with the communities.

On DBSA completing the projects by March 2023, Ms Chettiar replied that the framework contract allowed the completion of projects as indicated. All the projects had funding. They would, where necessary, extend the contract to ensure all the projects were completed. Involvement with the projects did not end once the construction was completed. NDT supported the projects with their individual sustainability plans to ensure they were operational and run correctly.

On the maintenance programme that DBSA was rolling out for them, Ms Chettiar recalled that NDT had developed the Tourism Sector Recovery Plan following the COVID-19 pandemic. One of the elements of work in the tourism sector was the protection of tourism supply. This was where maintenance of state-owned assets came into play. The APP has two maintenance projects. The one was in national parks run by SANParks and the provincial maintenance programme, which are provincially owned assets where DBSA was helping roll out the project. That was part of the APP and the Tourism Sector Recovery Plan looking at the protection of tourism supply.

Mr Tharage said that it was important to state that the procurement moratorium was no longer in force. The court order was in abeyance and DBSA would be able to tender. There would be skills transfer to address the capacity issue. There were skills that could be transferred and those that would not transfer easily. NDT colleagues would be able to monitor projects and follow through on commitments in project plans to manage contracts. However, they could not convert them into engineers. NDT would be unlikely to have the resources to keep engineers on its payroll. Whenever that expertise was required from time to time, it would then be able to source them.

DBSA made the payments to contractors as part of the overall management of the project. Percentages were retained to manage risks and guarantees that they were expected to have. The payment of all the third parties was made through DBSA. They made this framework as it allowed NDT to do the transfer to DBSA and then DBSA would give NDT a full account. Before an appointment is done, DBSA consults with NDT to see all necessary processes had been followed. Overall, NDT transferred funds to DBSA which would make third party payments.

The Acting Chairperson still wanted clarity on who was supposed to spend money on the Arts and Culture museums. Was there an MOU between NDT and DSAC about this expenditure?

She raised again the question by Mr De Freitas if any private projects were funded by government such as guest houses. Ms Mpushe had asked about consequence management which was not replied to. She noted the assurance the Committee needed that the projects would be completed on time. Were NDT and DBSA realistic that the projects would be completed by March 2023?

The Deputy Minister replied that the projects were community projects and not owned by NDT. This was why the projects would get handed over to the communities once they were completed. It was why they talked about project sustainability. No private project was being funded by government. The Mnisi Lodge took a private route which project the NDT threw out. They only funded community projects.

He agreed that the heritage and museum projects were part of Arts and Culture but the Department of Tourism had a responsibility to ensure that these tourist attractions were maintained at an acceptable standard. It was the same as the SANParks projects. If a department owner was unable to service the project, it would then have a discussion with NDT to see how they could share responsibilities to ensure that the tourist attractions remained at the level expected of a tourism destination. Consequence management was replied to by Mr Nxumalo.

Mr Tharage replied that they were realistic about the 2023 deadline. During 2020 and 2021 they lost a lot of time due to COVID. There were supply chain challenges due to the confusion around the interpretation of the Constitutional Court judgement on the PPR of 2017. All these issues needed to be factored in. They would be pushing to get most of the projects out by 2023.

Mr Tharage noted that the Deputy Minister had covered most of the questions and that they had an MOU with the Department of Arts and Culture. They had an MOU with the Department of Environmental Affairs. On all the projects in the APP, they had been very transparent in what they wanted to do. Giving the example of the amaHlubi community, these museums belonged to the communities and were not managed and owned by DSAC. The money used for this was appropriated for in the Tourism budget as per the APP.

Mr Tharage said it was part of a broader strategy to ensure that tourism destinations did not deteriorate. The emphasis was placed on ensuring they were not losing the supply side. This is why they did work in places like Robben Island where they now have a mini solar power station on site. This saved millions on diesel per annum. The diesel polluted the environment. These were some of the things that drove them to create destinations that Members would be proud of and were appealing to the market.

The Chairperson was happy with the responses and they had replied adequately to the questions.

Ms Mpushe wanted to follow up because she was not satisfied with the response about theft at Ngove Lodge. Was the response implying that the Committee had to contact SAPS for quantification of the lost items. NDT had provided assets to Ngove. She wanted a response that outlined what NDT had provided, what was stolen and the cost implications of this.

The purpose of this meeting was not understood by NDT. What provoked the meeting was the Committee oversight visit to two projects in Limpopo. The DM should be aware that they would not be able to table the Committee Report on the oversight visit before having this meeting with NDT and DBSA. It might coincide with the fact that the APP was tabled. She wanted the Committee to get a detailed report on each project and the budget allocated, with the GTAC recommendation that NDT should proceed with the projects in parallel with addressing the sustainability model at a R17.7 million estimated cost then.

Ms Mpushe said a lot of issues were raised in the GTAC report about the feasibility studies that were not done. On its visit to Limpopo, the Committee found that there were about 57 projects which were like what was happening at Ngove. The initial project at Ngove was meant to be a cultural village but upon implementation, something else was constructed and not what the community wanted. There was a misunderstanding on the project funding as it was a project which had structures already erected and NDT had to make additions to the structure. This was why they wanted a detailed report on the Ngove project. It had been 20 years since the Ngove project was not completed. It was wasteful expenditure and no monitoring was done on the project. The current structure is being vandalised as the community did not want to own what was done by NDT.

If NDT has not imposed the current structure, what forms the current design and not what was agreed about with the community? The Committee had the responsibility to go back to the communities with responses that would lead to an amicable solution so they could have ownership of the Ngove project. The Committee did not want a continuation of what it had observed at its visit. It was true NDT replied about consequence management but it only dealt with current projects. The GTAC report was on projects undertaken historically. Had there been consequences for wrongdoing based on the GTAC report findings and recommendations? If there was no feasibility study and contractors did not complete their work, then someone is responsible.

The Chairperson said that Ms Mpushe’s questions were valid. She wanted to ask the committee secretary for clarity on why this meeting was requested but he had network difficulties.

Deputy Minister Mahlalela explained that NDT understood the meeting was not in the context of the Committee oversight visits. Recalling the 3 May meeting on the Annual Performance plan, the DBSA MOA was raised. The Chairperson wanted them to make a presentation on the MOA so the Committee could understand its modus operandi. NDT was not aware that the meeting went beyond the MOA and included the oversight visits by the Portfolio Committee. He referred to the historical projects that were implemented when NDT started the process years back in 2002/03.

On consequence management, NDT had already reported that some officials had been suspended, some charged, and some had criminal cases opened against them. It updated the Committee on what was being done about the challenges detected by Auditor-General in the 2017/2018 audit and the GTAC report. The new process was to remedy all that had been identified through GTAC and Auditor-General reports and this came with a new DBSA MOA approach. NDT understood that it was to present progress in the new MOA approach.

On the Ngove project, the Deputy Minister and DG had not been there but the DDG had. That was why they had asked her to respond, except she did not respond to the Committee's satisfaction.

The Chairperson said the Deputy Minister had clarified the matter and Ms Mpushe had been adequately replied to. She understood the Deputy Minister on how the meeting invitation happened. Perhaps the Committee would have to find space to make recommendations to the National Assembly on the concerns raised by Ms Mpushe. She thanked everyone for their valuable contributions and excused NDT and DBSA.

Ms Mpushe proposed as a way forward that the Committee request NDT to provide a detailed written report on the value of the projects and not necessarily to have another meeting.

The Committee adopted the 31 May 2022 minutes and the meeting was adjourned.