DOC/GCIS & DTPS BRRR

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Communications and Digital Technologies

01 December 2020
Chairperson: Mr B Maneli (ANC)
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Meeting Summary

Video: PC Communications, 2 December

2020 BRRRs

In a virtual meeting, the Committee considered and adopted the BRRR on Department of Communications (DOC) / Government Communication and Information System (GCIS) and Department of Telecommunications and Postal Services (DTPS).

The BRRR on the DOC/GCIS was compiled having considered the performance and submission to National Treasury for the medium term period of the DOC; GCIS; Film and Publication Board (FPB); and Independent Communications Authority of South Africa (ICASA).

The BRRR on DTPS was compiled having considered the financial and non-financial performance for the year 2019/20 of the DTPS; Sentech; State Information Technology Agency (SITA); Broadband Infraco (BBI), National Electronic Media of South Africa (NEMISA), and ZADNA.

Members raised observations on the Auditor General findings dealing with procurement of goods and services without obtaining the required price quotations or competitive bids; significant internal control deficiencies and management not adequately implementing controls to prevent non-compliance that resulted in irregular expenditure; and disciplinary steps not taken against officials who permitted irregular expenditure. The Committee added some recommendations in the meeting which were GCIS should ensure no underspending in future; the Media Development and Diversity Agency (MDDA) should have further engagements with SABC to assist community media; content regulation of streaming services by FPB; getting the future measures of reconfigured entities; obtaining legal opinion on merging entities to have a memorandum of understanding (MOU) during the process. It was noted that the Minister of Communications could not be asked to ensure the independence of ICASA as the councillor controversy did not happen during 2020/21.

Attention was drawn to those entities that had failed to table their Annual Reports by the extended deadline of 16 November so the Committee had been unable to include them in the BRRR – Universal Service and Access Agency of South Africa (USAASA), South African Broadcasting Corporation (SABC), and South African Post Office (SAPO). It was agreed that although the SABC had tabled its Annual Report on 17 November, as the Committee had not interrogated it in a meeting with SABC, it could not include it in the BRRR.

Meeting report

The Chairperson explained that the Committee would consider and adopt the BRRR after having done oversight of the departments and its entities and having been briefed by the Auditor-General. Apologies from the Minister and Deputy Minister of Communications were noted.

The adoption of the BRRR had to be done before 4 December 2020. The Committee had been sent the reports and asked to go through them and forward proposed changes to the secretary. He appreciated those Members who had sent proposals. Members had an opportunity to verify that those matters were corrected in this meeting.

Department of Communications / GCIS BRRR
The Chairperson read through the BRRR page by page. He would spend some time on observations and recommendations for Members to correct items in the report. He asked Members to indicate if there was a page they wanted to talk to.

Mr Thembinkosi Ngoma, Committee Secretary, noted that the document highlighted the changes submitted by Mr Mackenzie so the Committee could accept or reject these additions as they went through the report.

Mr Mackenzie referred to page 18 and asked if “performance information” was different to “programme” or if it was the same. If it was the same, then the sentence was being repeated.

The Chairperson thought that it was a repetition as well.

Mr Mbombo Maleka, Content Advisor, understood the concern but said that the way it was written in the Audit Report was such that it was two different processes. The Auditor-General would assess a particular programme in a department but then, in doing so, they again separately state the usefulness and reliability of the information itself. This had been taken from two components of the Auditor-General’s Audit Report. There was a reason for separating them but he would be guided by the Committee.

The Chairperson said the point was nothing changed in the two sentences except for “industry” and “capacity”.

Mr Mackenzie suggested that it be left as is.

The Chairperson said that in the end the Committee had to own the report. The question was whether the sentence meant something else.

Ms Z Majozi (IFP) proposed the Committee see if they had referenced the Auditor-General correctly. She herself did not understand what is meant by the Auditor-General did not raise and material findings on the usefulness and reliability of the reported performance information. This was a bit confusing.

The Chairperson said that the Committee just needed to understand as the sentences were more or less the same. Mr Maleka could look at this and get back to them. Correcting a duplication was just for the correctness of the report and its flow. They would come back to this point later.

Mr Mackenzie asked if the Secretariat had received and included Ms Van Damme’s contributions.

Ms Salie replied that it had been received but not included. In a WhatsApp message Ms Van Damme mentioned that Mr Mackenzie would bring it up during the meeting.

The Chairperson accepted that Ms Van Damme’s contributions would not be included unless Mr Mackenzie had received this. He thought that the points raised on the virtual platform may have been clarified for Ms Van Damme.

Mr Mackenzie referred to page 58 and asked for the meaning of “terminal post”.

The Chairperson said that terminal posts would have been additional and contractual posts that could be terminated at the end of the contract. They would not part of the structure or organogram. This was the explanation the Committee had received from the Auditor-General at the time.

Mr Mackenzie said that the Chairperson was correct and did not forget a thing.

The Chairperson said that the Committee could ask DOC for the proper wording.

Mr Mackenzie said he had input from Ms Van Damme on Committee observations. It was quite lengthy and he asked to read it into the record so the Committee could decide if it agreed. However, the observations did not seem controversial.

For DOC: First, the Auditor-General reported that some of the goods and services with a transaction value below R500 000 were procured without obtaining price quotations as required by Treasury regulations. Second, some of the goods of a transaction value above R500 000 were procured without inviting competitive bids and deviations were approved by the accounting officer even though it was practical to invite competitive bids as required by Treasury regulations 16A6.1 and 16A6.4. Third, there were significant internal control deficiencies that resulted in findings of non-compliance with legislation plus management did not adequately implement review and monitoring controls to prevent non-compliance with applicable laws and regulations for supply chain management which resulted in irregular expenditure.

For ICASA: First, effective and appropriate steps were not taken to prevent irregular expenditure of R3 369 931. Second, disciplinary steps were not taken against some of the officials who incurred or permitted irregular expenditure and fruitless and wasteful expenditure as required by section 38(1)(h)(iii) of the Public Finance Management Act. Third, some goods and services with a transaction value below R500 000 were procured without obtaining quotations as required by Treasury regulation 16A16.1. Similar non-compliance was also reported in the prior year. Fourth, management did not implement adequate controls to prevent and detect non-compliance with laws and regulations which resulted in irregular expenditure.

For GCIS: Of the allocated budget, GCIS spent R425.6 million (97%) which resulted in an underspending of R13.1 million.

Mr Maleka said that all recommendations emanating from the Committee interaction with the Auditor-General were under 10.5 of the BRRR. This was where all the Auditor-General’s recommendations were consolidated into one set and included all the entities. However, this could be separated.

The Chairperson said that the structure did not have to be changed. The way Mr Maleka had put it was helpful so the Committee could know the directives from the Auditor-General and their own observations from the reports received from DOC and its entities, as they were not presented on the same day.

Ms P Faku (ANC) said that the recommendations in 10.5 had to be made by the Committee to all entities as per the Auditor-General’s report – not focus the way Ms Van Damme had said to. However, she did not have a problem if the Committee felt differently.

The Chairperson explained that Ms Van Damme’s observations were just being noted as she was absent. The administration did not receive recommendations for corrections to be made. The Committee noted her observations but they were in the report, so only those not in the report were to be considered. It was agreed that the structure of the report would not be changed as the Auditor-General presented on a separate day to the Department reports.

Mr Mackenzie sought clarity on the points tabled as Committee observations. He asked if the Secretariat would go through the report and check the Observations to see which have been included and which have not.

The Chairperson confirmed that Mr Mackenzie’s understanding was correct as the observations were directly from the report and were not new.

Ms Faku referred to the point that USAASA did not submit its Annual Report. She asked if the Annual Report was tabled yet in the Committee.

The Chairperson said that it was not because it needed to be approved. This matter was also raised with the SABC and SAPO as they did not present to the Committee.

Mr Maleka explained that the only difference was that SABC had tabled it Annual Report but by that time the Committee had already undergone the evaluation of Annual Reports with all the entities. There was thus not time to then re-programme so the Committee could meet with SABC and SAPO. DOC had reported that other entities had not tabled officially to Parliament.

The Chairperson continued to the Recommendations. In reference to the zero-based budgeting recommendation, his understanding was different because he thought that the DOC response nullified the recommendation in that for 2020/21 it was National Treasury and Department of Public Enterprises to act as the pilot departments to practise zero-based budgeting as pronounced by the Minister of Finance. He did not want the Committee to adopt a recommendation unable to be implemented.

Mr Mackenzie agreed.

The Chairperson referred to 11.1 and said he was trying to find where it spoke to the Committee asking for an explanation on work done against the targets to justify budget spent. There was an explanation of how a Bill would work when the Committee asked about the having almost the whole budget spent but the target not being at 100%. The Committee had indicated that it might need explanatory notes on the work done to justify the costs incurred on the Bill development.

Mr Mackenzie read in a new recommendation. On the allocated budget, can GCIS ensure no underspending in the future? Even though 97% of the budget was spent, the R13.1 million could have been put to good use for public education initiatives.

Ms Faku stated that she had no problem with Mr Mackenzie’s recommendation.

The Chairperson agreed. He referred to 11.2 which recommended the Minister must ensure that the GCIS provided a full audit of their printing versus electronic costs. Was this not asking for information the Committee had already received. This was to separate discussion from resolution.

Mr Mackenzie said that he did not recall seeing a report on this.

The Chairperson understood that GCIS would have given the Committee a sense of their printing versus electronic costs but the Committee could ask for it. In the debate, one of the important points raised was that Parliament made decisions and the Committee never followed up on them to see their implementation. Therefore, whatever recommendation the Committee made, it had to also have the capacity to ensure that it is implemented. If it has already been implemented, then at least acknowledge that it was done. The intention was not to delete recommendation but he wanted to ensure the Committee was not asking for something it had already received in reports GCIS had given it. He asked that it be verified if the information had been received.

Ms Faku said that one of the MDDA recommendations had been that the MDDA had to have further engagements with SABC. However, she did not see this recommendation in the BRRR.

The Chairperson noted that the recommendation was to assist community media and asked Mr Maleka to add this.

The Chairperson did not think the recommendation that the Minister should encourage ICASA to maintain its independence should be deleted as it did not make sense given that it was known that ICASA was independent. More importantly, the Committee could not ask the Minister to ensure this otherwise the Minister could be accused of interfering with the independence of ICASA.

Ms Faku did not think the point of encouraging ICASA to maintain its independence had been raised in a meeting.

The Chairperson said that he did not know. However, to give that duty to the Minister would be taking the Committee where they did not want to go.

Ms Faku agreed that it should be removed.

Mr Mackenzie said that one of the defining moments last term had been the ICASA councillor appointment. The Committee and the Minister had virtually gone head to head over the appointment of the sixth councillor. He thus thought that the recommendation on the independence of ICASA spoke to this, which was what the recommendation was trying to address. He thought that it was an important point. However, if the Committee wanted to remove it, it was fine.

The Chairperson noted the law had already given ICASA independence. This was not in the 2019/20 period under review. In the period under review, the point did not really arise. For this reason, he thought that the recommendation should be removed. When the Committee did the quarterly report and the matter arose, the Committee might coin it differently. However, he did not think that the responsibility should be given to the Minister. The Minister could provide other support because the Committee would ask the Minister for a report on the recommendations the Committee said she had to do. He clarified that he was not discouraging Mr Mackenzie’s point but said that this point had not been debated in the period under review.

Ms Faku said that one of the Committee recommendations in light of Covid-19 was ICASA public hearings would have to be done via the virtual platform due to Covid-19 restrictions. She did not see this point in the Recommendations but did not know if there was a need for it.

The Chairperson thought that recommendation (ii) spoke to public hearings which could not happen before due to Covid-19 restrictions on the number of people. The Committee was recommending that the Minister should ensure they met targets for conducting public hearings. The modalities would be left to ICASA on whether it went hybrid or virtual given that the lockdown restrictions had been relaxed on the number of people allowed.

The Chairperson referred to the FPB recommendation on strategies to promote regulation of streaming services especially with the rise of sex, nudity, violence, and strong language. He asked if this was how the Committee wanted the recommendation to be captured. Should it not rather state publication of "prohibited materials” as opposed to explaining what was being referred to. It had to be looked at from what the law said and both the industry and complainant's point of view. “Prohibited materials” would include the classification from an FPB point of view.

Mr Mackenzie heard the Chairperson’s concerns on this point but as he understood it, FPB said that it had spoken to the streaming services and they were getting on board on regulating content.

The Chairperson explained that what the recommendation may be able to control was what was prohibited by law. He asked that Mr Maleka advise if this needed to be reviewed. He also asked Mr Maleka to verify the point in 11.5 that SABC had not tabled its Annual Report by the time the Committee finalised the BRRR. At the time the Committee had to meet the SABC, the SABC was presenting its Annual Report in the media – not Parliament. He asked that Mr Maleka clarify this.

Mr Maleka replied that the SABC may have made a media announcement on its Annual Report when it had tabled it in Parliament. However, at this point the Committee had already concluded its engagements with the entire portfolio reviewing the Annual Reports. Unfortunately, it was a timing issue and there was no way that another meeting could be set up. His understanding was that the SABC could not be included despite tabling the document. DOC had warned that certain entities would not table in time. It was just unfortunate that the SABC tabled it after the Committee had concluded the review.

The Chairperson was trying to understand the notion of tabling and not tabling. The Auditor-General would have said that the Committee should not speak to those not tabled in Parliament. What was meant as SABC had tabled its Annual Report but the Committee had not interacted with the SABC on it – only the Annual Performance Plan (APP) review. The Annual Report was presented to the media – was this taken to be a presentation to Parliament? This was important for the record so that when the Committee was in the House this question did not arise.

Ms N Khubekha (ANC) agreed with the Chairperson and asked that it be checked. The SABC had not addressed the Committee on its Annual Report as the other entities had done although the Auditor-General had discussed all the audit reports. There was no engagement with the SABC.

The Chairperson said the Committee had to understand this from a process point of view. Immediately after the debate in the National Assembly, the Standing Committee on Public Accounts would present its oversight report on SABC. This went to the point of the Committees itself holding an entity accountable and one of these ways was to interrogate the Annual Report. The SABC had not done this. He asked for assistance in understanding this process.

Mr Maleka said that the Chairperson was correct. In his experience of serving the Committee, there had never been a time where it shortcut its oversight role over the Annual Report. When the report was tabled, the Committee would schedule the entity to appear before the Committee to account. This was an oversight function that the Committee could not eradicate. As the record stated, SABC had not come before the Committee to present its Annual Report. It could not be that the Committee included it in the BRRR when they had not had the opportunity to process the Annual Report as a Committee. Officially the SABC had not tabled by the time the Committee had processed the portfolio's reports. This was not the first time. He recalled that previously SABC had to be scheduled for the following term for the Committee to report separately on the entity.

The Committee Secretary said that it was important to indicate that SABC had tabled. The message should not be the SABC had not tabled. SABC had tabled on 17 November 2020 and it then appeared before the Committee the following day when the Auditor-General presented on the audits. The SABC had tabled very late and thus it was requested that the entities table on time, even thought a cut-off date was set for 16 November 2020. This was so the Committee could consider all annual reports and financial statements on time. The Committee was expected to conduct proper oversight of all the entities. The process of drafting the BRRR actually begun earlier in the year as it was based on the 2019/20 financial year. The SABC had only tabled at the time the Committee was concluding the process. There would not have been enough time for the Committee to properly consider the Annual Report. Thus, it was rescheduled for the first term so the Committee had enough time to interrogate the SABC report.

Ms Khubekha asked when did the SABC table the Annual Report before the Committee. She asked for the specific date.

Ms Salie replied that the process had been started more or less in late October. There was then consistent negotiation and communication with DOC to check who would and would not be tabling. The Committee was informed that SABC would not be tabling, plus USAASA and other entities. The Committee planed its programme and started on 4 and 6 November 2020 with the Annual Reports. It was told that SITA would not be tabling but then heard it would be tabling. SITA was scheduled for 18 November 2020 as the last scheduling. Unbeknownst, a day before meeting the Auditor-General on 17 November 2020, SABC tabled. This was not on the programme and the Secretariat was also not really informed by DOC to ask if space was being made for SABC. As far as the Committee knew, SABC was not going to table by the 16 November 2020 deadline.

The Chairperson said the point was SABC may have tabled in Parliament but the Committee had not performed oversight on the SABC Annual Report as had been done with other entities. This meant that it was a matter that still needed to be looked at. Whilst it may have been tabled in terms of processing, the Committee did not have the Annual Report despite it being in the media. The Committee still needed to engage the Annual Report from a point of oversight.

Ms Khubekha agreed that there had not been oversight and that it should be considered in future.

The Chairperson continued onto the Auditor-General's recommendations.

Ms Faku referred to the recommendation that the Committee should follow up on all unauthorised, fruitless, wasteful and irregular expenditure. The Committee needed to be firm and she did not feel that the wording was firm enough – especially considering the recommendations that had been received from Parliament today. The Committee had to ensure that they did not just "follow up" as this was not a strong message that work was being done. She understood that what was said earlier focused on SABC but all entities needed to have consequence management.

The Chairperson understood Ms Faku’s point. Perhaps it should read: “the Committee will, through oversight, ensure that all unauthorised, fruitless and wasteful expenditure is investigated and acted upon by the entities and the DOC”. This would speak to investigation as well as consequences.

Mr Mackenzie had a sentence he was going to suggest for ICASA but it might be what Ms Faku was looking for. He read: “As identified by the Auditor-General, investigation must commence and disciplinary action taken against staff who permitted fruitless and wasteful expenditure.” He wanted to include this specifically under ICASA but it was a very strong statement. He understood what Ms Faku was saying. He liked how the Chairperson rephrased it as it was also quite strong and firm.  

The Chairperson said that the point was that the Committee now extended the recommendation to apply to all entities. The Committee needed to focus this scope on all the entities.

The Committee adopted the BRRR. The DA reserved its position on the report.

Department of Telecommunications and Postal Services (DTPS) BRRR
The Chairperson went through the report page by page with Members indicating suggestion.

Mr Mackenzie asked what the Rapid National Centre was as he had never heard of it.

The Chairperson asked Mr Maleka to provide clarity if it was a Disaster Recovery Centre.

Mr Maleka replied it was written like that in the Annual Report but he would verify this.

Mr Mackenzie asked if it was correct that the procurement and industry programmes registered 0% performance against their targets.

The Chairperson confirmed that the report stated 0% target achievement for both procurement and industry.

It was noted that the requirement for payment to creditors within 30 days was driven by a policy directive rather than by law.

The Chairperson said the Committee still had four entities outstanding: SABC, SAPO, Universal Service and Access Fund (USAF) and USAASA. He was not sure what to do as this was the last meeting of the year but he wanted to raise the next point whilst dealing with the BRRR. He was sure that the Committee would agree that due to the number of entities it dealt with, it can get overwhelmed in terms of doing proper oversight. He suggested that with the reconfiguration presented by DTPS, they probably had to look at getting the timelines on the measures and what was required in law. The Committee needed to have a legal opinion on the possibility of having those that would be merged having an MOU in terms of working together.

This was so that when the Committee called these entities before them, it would be able to group them on the basis of what they were supposed to be in future and the MOU between themselves. Otherwise, the Committee may not be effective. In seeking thoroughness, the Committee could get really overworked to the point of not being effective in the way it did its work. As a result, some entities would not receive similar attention to what the Committee was giving to others such as SABC and SAPO. Looking at legality was important as what the Committee did had to be within the law. There were already situations where SITA and BBI work together, and Sentech with USAASA. There was no time to really look at this, otherwise the Committee would talk reconfiguration and performance measures of entities but never follow it up with concrete action. The Members should determine if this was something to include in the BRRR.

Mr Mackenzie liked what the Chairperson said and it was important to include it in the BRRR. It was a useful point to the DTPS on how to present to the Committee going forward.

The Committee adopted the report with the Chairperson's added recommendation. The DA reserved its position.

Closing remarks
The Chairperson said, as agreed, all other matters would be dealt with next term when the Committee returned as Parliament was now rising. This included the work that the administration would continue to do on the MDDA and SABC process. As this was the last Committee meeting, he thanked Members for their commitment. As could be seen from the BRRR, the Committee had dealt with a lot. More importantly, he appreciated the unity and maturity displayed in the way Members had handled the difficult matters that came before the Committee. He appreciated that the Committee had put South Africans first while putting aside any differences in terms of orientation, both politically and ideologically, to ensure that at the end South Africans benefitted from the contribution that needed to be made as the electorate. He knew Members were tired. They could rest assured that, as they took the break to rest, they could look back and see that they had made a contribution. This was especially as most of the Members in the Committee were new and a lot had been expected to hit the ground running. The way the Committee worked as a body, it could proudly be said that they had been able to discharge their duties under difficult conditions and with much work to do out there. The year closed with the SABC matter still present. Members were to keep an eye out so when the need arose and the Committee reported for duty, they would be able to do so in the interest of South Africans.

Meeting adjourned.
 

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