Compensation Fund New Action Plan; with Deputy Minister

Meeting report

The Chairperson said the third and fourth quarterly performance report would not be discussed. This emanated from the previous sitting, at which she had emphasised that departments and their entities must adhere to submission timeframes for reports and presentations.

Compensation Fund's new action plan

Mr Vuyo Mafata, Compensation Fund Commissioner, gave an overview of the presentation. He said that the action plan detailed the key activities which had to be implemented and completed within the shortest possible time, which is between June 2021 to November 2021.

(See attached document for details)

The Chairperson thanked Mr Mafata for the presentation, commenting that the situation with the Compensation Fund was always a major concern. The Committee had requested a detailed action plan.

Discussion

Mr M Bagraim (DA) applauded the Chairperson for always providing feedback and responding on matters of concern. The Committee had seen heard and plans from the Compensation Fund (CF) before. This one was sounding hollow. It was good to make plans, but the implementation of these plans was a problem. The plans presented now could be criticised only in the coming six months. The findings addressed in the plan had been reported on for the last five years. Could this be explained?

Ms H Denner (FF+) sought clarity on slides 5 and 6, and asked whether progress had been made. Could the minutes be made available and circulated? She said slide 5 referred to the inputs of the Auditor-General of South Africa (AGSA). Since the Compensation Fund was awaiting formal correspondence from AGSA, had there been follow-up sessions, and were the findings in the reports not followed up on?

She wanted to know on which dates the action plans in slides 10-16 had either been achieved or not achieved, as the set time lines shown in slides 14-16 had passed.

Mr M Nontsele (ANC) said that he had experienced poor connection, and sought clarity on consequence management.

The Chairperson responded that Mr Nontsele had missed some information due to the bad connection. The plan had been discussed during interaction with the Auditor-General.

Responding to the questions raised by Ms Denner, she said that if there was oversight conducted by the Ministry; the Committee would have to ask the Ministry about the outcomes and recommendations, and not the Commissioner. The Minister and the Director-General (DG) would have to take the Committee through that discussion.

Responses

Mr Mafata said Mr Bagraim was correct -- action plans had been presented to the Committee before. Subsequently, other action plans had been developed because the first plans had addressed only the basics, when the organisation was in a terrible situation and unable to function. New action plans had to be developed to stabilise the situation, as the organisation was almost unable to function in 2015. An operational plan had to be developed that would have an impact on the Compensation Fund, enabling it to function and ultimately to ensure a clean audit.

The first part of the plans indicates the controls that had been implemented, based on the previous action plans. The current action plan which has been presented addresses the challenges and controls arising from the previous plans. This was to ensure the controls were implemented and monitored, and also to ensure an improvement in the control environment.

At the end of August, a progress report was compiled which provides details on follow-ups and timeframes. In July, there had been a process of concurrently implementing some activities, with consultations on previous activities that had to be implemented. The progress report answers most questions that had been asked. Going forward, progress reports would be produced and circulated on a monthly basis and, if necessary, would also be presented to the Committee monthly.

There had been follow up discussions with the Auditor- General (AG). The action plan was produced in June, and a draft of it was presented to the Minister. The AG had checked to see if the design adequately addressed the findings and controls that had been highlighted, as well as the discussions with the Committee. Feedback from the AG had identified weaknesses in the action plan, and this had resulted in more follow up sessions. Some weaknesses were valid, while others resulted from a misunderstanding of activities.

The areas that had to be addressed were discussed with the “clean audit” coordinator.  The main discussions were on controls, as there were not enough monitoring and preventative controls in the action plan. During July, management had to review the action plan to ensure monitoring and preventative controls were adequately included. This processes was concluded with senior managers at the AGSA. Feedback from the AG had confirmed their satisfaction with the design of the action plan, and formal written confirmation to this effect was awaited.

Further discussion

The Chairperson said that when the AGSA presents, it would be important that it addresses what had been presented by the Compensation Fund. This was not the first plan from the Fund. It was the responsibility of the Committee to ensure compliance to the plan. The Committee must ensure the implementation and actions were monitored according to the timeframes, and by when the Fund would report. If not, the same matters would arise in the coming quarters, with new team members involved in the Compensation Fund. What were the timeframes for the Fund to report back to the Committee? This would ensure proper monitoring of the plan. She asked Members for input on the setting of timeframes.

Ms Denner said the progress reports must still be finalised, as indicated by Mr Mafata. This could be used as basis to come up with a set timeframe. The Compensation Fund could present the progress report to the Committee by the end of September.

Mr S Ngcobo (IFP) agreed with Ms Denner's suggestion.

The Committee Members all agreed with the timeframe set for the Compensation Fund to report.

The Chairperson said the comments and suggestions were valid. This time around, the Committee meant business, and the suggestions and comments had to be taken seriously by the Compensation Fund and the Department.

Concluding remarks

Ms Boitumelo Moloi, Deputy Minister of Employment and Labour, said progress had been made, and the Department and the Compensation Fund would be able to report on matters not achieved. Feedback would be provided in September.

The Chairperson said the Committee had requested an action plan because there were major concerns. The concern was about the ordinary people who had to receive services from the Compensation Fund, as this was one of the most important spheres of the labour environment.

She told the Commissioner and the managers who were taking their work seriously that she hoped that when the AG provided feedback to the Committee, that it would indicate real change. The Commissioner, as the captain of the ship, must ensure there were results based on the outcomes that must be reflected in the reports. The work would not all be done by the month end, but it would be good to see that some challenges had been corrected by the end of the term.

The report that was due by the end of September must be submitted seven days before month end. Members of the Department and the Compensation Fund must be prepared and adhere to the submission due dates.

She thanked the Deputy Minister and Members for their commitment to address all the challenges. Learning that the Compensation Fund had disclaimed audit opinions, as highlighted by the Auditor-General, had been a bitter pill to swallow. The team and managers led by Mr Mafata must ensure that the situation improves.

The meeting was adjourned.