Chairperson, hon Minister of Public Works, hon Deputy Minister of Public Works, Ministers present here, director-general of the department, members of the Portfolio Committee on Public Works, entities reporting to the department, officials and employees of the department, distinguished guests, ladies and gentlemen, good morning.
The Constitution of the Republic of South Africa is the supreme law of the country and speaks of not forgetting the past, but also requires of us to look beyond that. At the beginning, the Constitution emphasises this with the words "We, the people of South Africa," reminding us that we are one and that the past is there, not forgotten, and helping us to move forward. But I will quote the main reason why, I believe, we are here today, and that is, "to improve the quality of life for all citizens and free the potential of each person".
The quality of life of each citizen is written into our Constitution and requires that we all make an effort to make sure that people do not lose hope in that promise. The Portfolio Committee on Public Works saw this hope from the people when doing its oversight work in various provinces.
The committee believes that the Department of Public Works can contribute to the constitutional obligation of improving the lives of people whilst addressing its own challenges. The Minister of Public Works said that there are challenges in the department, but after broad consultation with the stakeholders, especially the staff within the department, he identified key areas that prevented the department from carrying out its mandate properly.
In 2012, the Minister introduced a turnaround strategy with the immediate focus on stabilising the department by providing strong leadership at ministerial and departmental levels, and evaluating the mandate of the department to determine why and how well it is being implemented.
The Minister reported to the committee that some of the 18 main points that are included in the turnaround strategy will only be implemented in phases. The planned result is the gradual transformation of the department from its current negative image as a department of slow delivery, or no delivery, to that of a department that will ensure that it provides quality service to all its client departments. We all know this is a process that will take time.
The department has a number of challenges, which includes the mismanagement of resources and fraud and corruption, as mentioned by the Minister. The Minister presented a report to the portfolio committee highlighting issues affecting delivery by the department. These included persons suspended and the finalisation of the disciplinary processes, extended through the use of court action.
The report indicated that cases had been resolved or were in the process of being resolved. An example is the request for the resignation of the chief financial officer, CFO, of the department. This was to address the challenge of not being able to fill the positions where persons were suspended and their cases have not been finalised. The Minister emphasised that this did not mean that criminal charges could not be instituted against persons who were guilty of fraud or corruption.
The portfolio committee also found instances of irregular expenditure, which led to large variations in the cost of the Lebombo and Skilpadshek border posts, as well as the Kimberley new generation prison. The portfolio committee was informed during its oversight visit to the Lebombo Border Post that the facility was not being used due to its flawed design and the processing area that was not properly laid out. Also, the area where cash was received did not have any bulletproof glass, which the portfolio committee considered a risk.
In 2012, a joint meeting was also held with the Portfolio Committee on Home Affairs on the challenges it identified at the border posts. The issues identified at the Lebombo border post include the design of the processing area: directional flow of people and traffic between South Africa and the Mozambique border did not function as intended. During peak seasons, such as Easter and Christmas breaks, large volumes of traffic and pedestrians come through the border and that results in long delays. The portfolio committee also learnt that the land was being rented out at R10 per annum.
The systems that must be in place for the client department to be happy with the services they receive from the Department of Public Works will only happen when all structures are fully functional.
The Portfolio Committee on Public Works remains concerned about the department receiving two disclaimers of opinion from the Auditor-General. The Minister reported to the committee that while the turnaround strategy was beginning to transform the department, it would take time before the department received a clean audit.
The Minister also reported that proper systems are being put in place for the department to properly bill client departments, lease accommodation on behalf of national departments, and have the correct procurement and supply chain management systems in place.
The need for proper systems in the department was again highlighted in the findings of the Auditor-General on the 2010-11 financial year. Particular emphasis was placed on the functioning of the Property Management Trading Entity, PMTE. The Property Management Trading Entity received a disclaimer of opinion due to, among others, the lack of adequate systems for identifying and recognising the instances of fruitless and wasteful expenditure. An amount of R6,8 million occurred due to a lack of monthly preparation of supporting documents in the payment of municipal bills, interest paid resulting from late payments, flawed contracts and client departments vacating properties before the leases expired.
The committee therefore remains concerned about the department's lack of proper systems and controls, especially the challenges experienced in its leasing, procurement, supply chain management, SCM, and billing systems. The committee has raised these concerns with the department before, because some departments have had to do work that would ordinarily be done by the Department of Public Works. The departments felt that the work that needed to be completed was done too slowly. Now the Department of Public Works must claim back its mandate.
The department identified the following areas that impacted on its service delivery: A lack of capacity to clear the entire backlog in payments to municipalities and of experts to assist with the management of its property portfolio.
The department must still complete an effective, usable immovable asset register by 2014. Completing the asset register is important for government. It will then know what it owns, what state it is in, and how it can be used. The department has been struggling to complete the asset register. In response to these capacity constraints, the department appointed Ernst and Young as service provider to assist in the completion of the outstanding issues relating to the immovable asset register. But the asset register must be managed and maintained by officials within the department and not be dependent on consultants.
The committee has raised the issue of the department's capacity constraints. This has negatively affected the department's ability to carry out its mandate. It is currently undertaking a skills audit to understand the available skills in the department, and what vacancies it must fill. The department has already identified that technical skills professionals like engineers, architects, project managers and quantity surveyors must be appointed.
A call was also made to retired professionals to come and mentor graduates so that they can also have proper experience, so that they can qualify to be engineers, or architects with the built environment professional councils. The Council for the Built Environment, CBE, is responsible, along with the six professional councils, for overseeing the transformation of the built environment professions.
The participation of women in the different built environment professions does not reflect the demographics of the country, especially in engineering. The committee was concerned about the number of unemployed graduates who were not able to qualify as they did not receive proper training. This is because there is a shortage of engineers, project managers and quantity surveyors.
The department is also working together with the Departments of Public Service and Administration and Higher Education and Training to train artisans and technicians. The opening of workshops is planned to allow the department to improve its maintenance programme. This is important because it gives unemployed youth a chance to be trained to get proper jobs. But the workshops are currently not functioning properly and will be piloted in Pretoria and Cape Town.
The training of artisans and technicians is a medium to long-term strategy of the department. The training can eventually allow the department to reduce the outsourcing of its maintenance function. Employing artisans and young people trained to undertake maintenance of government buildings will eventually be more cost-effective. If the buildings are well maintained the life cycle of these assets can be extended.
The department will also introduce legislation to Parliament. The Agrment South Africa Bill will create Agrment South Africa, an entity reporting to the department as a juristic person. Usually when Public Works is mentioned it is to find out what it does wrong. But sometimes things can also be done right. The work done by Agrment South Africa is one example, and it successfully implemented its mandate to test and certify innovative building technologies which are safe for the public to use, cost effective and energy efficient.
Agrment is the smallest entity, receiving an allocation of just under R10 million from the department for the 2013-14 financial year. But, it has made a large contribution to the work of the department, as well as other departments, including Science and Technology, Human Settlements and Transport. The work of Agrment includes the technical certification of many new labour-intensive construction methods, such as the development of criteria for using thin concrete technology in road construction, which was developed and implemented in Gauteng and the Eastern Cape, and the environmental assessments, such as thermal performance and energy efficiency, that contribute towards environmental sustainability.
The chief executive officer, CEO, of Agrment SA presented its Annual Performance Plan to the committee and said that the vision of the entity is to make building cheaper and simpler so that people can build their own houses, especially in the rural areas. The committee agrees with this and suggests that the department encourage the use of the products certified by Agrment. It should facilitate the introduction of these products to more government departments, municipalities and entities. This is something that has gone right, and it says that if there is commitment, things can work.
The department also has two additional entities reporting to it, one of which is the Construction Industry Development Board, CIDB, which is tasked with the transformation of the construction industry and monitoring its progress. The CIDB presented a report by the Competition Commission on collusion in the construction industry. The committee was informed that collusion by big companies in the construction sector led to the exclusion of contractors at grades lower than 8 or 9 from progressing in the construction industry.
The committee learnt from its oversight of the provinces that emerging contractors were negatively affected by bigger companies. The smaller contractors struggled because they did not have a large capital base, could not easily get loans from banking institutions and sometimes failed due to late payments from the main contractor or government.
The Independent Development Trust, IDT, has been tasked to assist in the eradication of mud schools and unsafe structures. The IDT has used innovative construction methods to speed up the process. The committee observed the schools built in the Eastern Cape, but was concerned that the projects were not using the Expanded Public Works Programme, EPWP, principles of skills development. Also, labour needs intensify due to the short duration of these projects.
The replacement of inappropriate school buildings and the provision of basic services have been a matter of concern since 2007. In December last year, the Minister pledged the department's support to the Department of Basic Education and other stakeholders in the implementation of the Strategic Integrated Project 13 and the National School Build Programme, SIP 13. This is to address the inheritance of apartheid spatial planning by ensuring that there is uniformity in planning, procurement and contract management in the school refurbishment and building projects.
And I again quote from the Constitution:
Respect those who have worked to build and develop our country; and believe that South Africa belongs to all who live in it, united in our diversity.
This year is the centenary of the 1913 Natives Land Act. This is the proper title that states who was most affected by that legislation. But we do not forget that other people, for example the San, also lost their land. I mention this because members of the public expressed fear that the introduction of the draft expropriation Bill will lead to land grabs with no compensation. But this is not the intention of the draft Bill, as it wants to bring the existing Expropriation Act, No 13 of 1975, in line with the Constitution, section 25, the property clause, which is under the Bill of Rights.
The aim of the Bill is to provide for the expropriation of property for a public purpose or in the public interest, subject to just and equitable compensation, and to provide for matters connected thereto.
The draft expropriation Bill has already been published by the department for public comment on 13 April this year. In answer to a request made by the committee, the Deputy Minister of Public Works briefed the committee on the contents of the Bill. The information session assisted the committee and prepared it for its own engagement in public participation processes and deliberations of the draft Bill once it is tabled in Parliament and referred to the committee.
Section 9(3) of the Constitution clearly states a number of areas where citizens may not be disadvantaged. I will mention a select few here:
The state may not unfairly discriminate directly or indirectly against anyone on one or more grounds, including race, gender ... age ... disability ..
The country must deal with high rates of unemployment, poverty and inequality. In 2004, the Department of Public Works was tasked with leading Phase 1 of the Expanded Public Works Programme, EPWP. The EPWP is one of government's main programmes to reduce poverty and provide skills development to marginalised communities, especially those who live in rural areas. The programme uses labour-intensive methods on infrastructure projects so that ordinary people can work, learn a skill and get a daily stipend for the work.
We are now in Phase 2 of the programme, and it must create 4,5 million work opportunities by 2014. From 2009 to date, the programme produced 2,6 million work opportunities and will continue to scale up the participation in the programme. The committee, from its oversight visits to the provinces, recommended to the department that low-income municipalities receive assistance in creating work. The grant was amended to give low- income municipalities a chance to create work opportunities for them. They receive 40% of the grant upfront and the other 30% each once they have reported on the work opportunities created.
The committee is pleased that low capacity municipalities can take part in the EPWP. The targets for youth and women have been reached. But the committee is concerned about the 2% target for people with disabilities that has not been reached. The committee suggested to the department that they engage with organisations that represent people with disabilities so that they can also take part in the programme.
Finally, I end where I started, with a quote from our Constitution, that we are here to "improve the quality of life of all citizens and free the potential of each person".
We must all do this, and the department is expected to fulfil its mandate and implement it for the good of all. The budget of the department must be used for all people, but especially for the poor and marginalised communities in the rural areas, where economic development is usually very slow, so that they too can see their quality of life improve.
Tonakgolo, ngwane?o, o ?omile. Le ?omile, le fetot?e kgoro. Bomaganagobot?wa, bomaganagokwa, ba tlile go tla mo ba re ga o dire selo. Ipot?e gore o a ?oma. Maloko a Komiti ya Phothefolio, re ?omile, re a ?oma, re sa tlile go ?oma. Afrika Borwa e tla ba se e le go sona ka lebaka la Kgoro ya Me?omo ya Mmu?o. (Translation of Sepedi paragraph follows.)
[Hon Minister, my brother, you have done well, you have changed this department. The stubborn people, those who do not want to hear, who do not want to listen, will come here and say you have done nothing; but tell yourself that you have done your job. Members of the portfolio committee, you have done your job. We are doing our job, and we will continue to do it. South Africa will become what it is destined to be because of the Department of Public Works.]
Thank you very much. [Applause.]