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Memorandum from the Parliamentary Office
NATIONAL COUNCIL OF PROVINCES
FOR WRITTEN REPLY
QUESTION 374
DATE OF PUBLICATION OF INTERNAL QUESTION PAPER: 11/10/2013
(INTERNAL QUESTION PAPER 29 OF 2013)
Mr M J R de Villiers (DA-WC) to ask the Minister of Higher Education and
Training:
1) Whether he has received any reports from any universities regarding (a)
corruption, (b) maladministration or (c) irregular expenditure; if so,
(i) from which universities and (ii) what were the details;
2) in each case, what (a) steps were taken to remedy the situation, (b)
measures were put in place, (c) budget was (i) allocated and (ii) spent,
(d) is the breakdown of the budget and (e) time frame was set to rectify
these problems?
CW504E
REPLY:
1) Yes, I have received reports from universities regarding
allegations of corruption, maladministration and/or irregular
expenditure. Specifically, the reports were received as part of the
Terms of Reference for the Administrators of University of
Zululand, Walter Sisulu University, Vaal University of Technology
and Tshwane University of Technology. In addition, I have also
requested reports from the Central University of Technology and
University of Limpopo (UL) following allegations of irregularities.
Annexure A responds to questions 1 (ii) and 2 (a-d).
2) (e) In the case of Administrators, all work and timeframes are
guided by their Terms of References as gazetted. A letter was also
sent to UL on 22 October 2013 requesting the Council to respond
with a rectification plan within 3 months of receipt of the letter.
(See Annexure A for details).
Compiler/contact persons: Dr Engela van Staden and Ms Pearl Whittle
Ext: 5889 and 5248
DIRECTOR â GENERAL
STATUS:
DATE:
REPLY TO QUESTION 374 APPROVED/NOT APPROVED/AMENDED
Dr B NZIMANDE, MP
MINISTER OF HIGHER EDUCATION AND TRAINING
STATUS:
DATE:
ANNEXURE A
|Universit|1(ii) What were the |2(a) What steps |2(b) Measures were |2(c) Budget |2(d) |
|y |details |were taken |put in place | |Breakdown of |
| | | | | |budget |
| | | | |Allocated|Spent | |
|Tshwane |The Administrator |The first priority |The Administrator |R1 000 |R1 000 |Human |
|Universit|reported on the following|was to stabilise |appointed a Human |000 |000 |Resource |
|y of |irregularities at TUT: |the institution by |Resource (HR) | | |expert |
|Technolog|Events leading to the |dealing with the |consultant with | | |(R510 000) |
|y (TUT) |cancellation of the |appointment of |knowledge of HR | | |Consultancy |
| |contract of the then |Professor Molefe as|challenges in | | |(procurement,|
| |Vice-Chancellor who did |Vice-Chancellor of |higher education. | | |statute, |
| |not have a recognised and|TUT. Based on legal|The Administrator | | |investigation|
| |accredited doctoral |advice received, |made various | | |s (R490 000) |
| |qualification. Human |Professor Molefeâs |executive | | | |
| |Resources was one of the |contract was |management | | | |
| |sources of discontent at |cancelled. |appointments | | | |
| |the TUT. |A procurement |including the | | | |
| |One of the anomalies |expert has been |appointment of the | | | |
| |reported was the |appointed to review|Vice-Chancellor | | | |
| |influence that trade |the procurement |(VC). | | | |
| |unions and student |policies and |Various financial | | | |
| |structures had on |processes of TUT |and procurement | | | |
| |management |and produce a |policies were | | | |
| |responsibilities at TUT. |report to overhaul |approved and put in| | | |
| |The Independent Assessor |its procurement |place during the | | | |
| |has indicated in his |process and its |2012 academic year.| | | |
| |report that the |governance | | | | |
| |Information Technology |arrangements. The |Audit and Risk | | | |
| |(IT) entity had become a |Administrator |Committee has been | | | |
| |law unto themselves and |appointed expertise|put in place with | | | |
| |that serious decisions |in a number of |the establishment | | | |
| |around IT infrastructure |areas such as |of a new Council. | | | |
| |needed to be made. |legal, financial, | | | | |
| | |procurement, Human | | | | |
| | |Resources, etc. | | | | |
| | |An in-depth | | | | |
| | |investigation into | | | | |
| | |the universityâs | | | | |
| | |Information | | | | |
| | |Communication | | | | |
| | |Technology (ICT) | | | | |
| | |Services was | | | | |
| | |conducted which | | | | |
| | |pointed to serious | | | | |
| | |irregularities in | | | | |
| | |the universityâs | | | | |
| | |ICT services unit. | | | | |
| | |Disciplinary action| | | | |
| | |was taken against | | | | |
| | |employees who were | | | | |
| | |found to have | | | | |
| | |transgressed rules | | | | |
| | |and good practice | | | | |
| | |principles. | | | | |
|Water |The Administrator |Six forensic audits|Significant |R14Â 500 |R14 541 |Budget of |
|Sisulu |reported on the |have been conducted|progress has been |000 |016 |R14.5 million|
|Universit|ring-fenced funds that |and concluded. |made in | | |was provided |
|y (WSU) |were utilised to cover |These include: |implementing | | |for the |
| |salaries. The period of |- A physical |internal control | | |appointment |
| |administration has |verification of |systems with the | | |of the |
| |revealed significant |staff together with|result that some | | |turnaround |
| |previously unreported |biometric and |staff members have | | |task team and|
| |amounts that have not |personal |been subjected to | | |associated |
| |featured on prior cash |information coupled|disciplinary | | |costs in the |
| |flows with the result |with qualifications|hearings and | | |following |
| |that nobody knew what the|audit of staff to |dismissed following| | |areas: |
| |university owed. Examples|test for ghosts in |the outcome of | | |Finance, |
| |are the R3 million in|the system. All 2 |forensic audits. | | |Human |
| |group-life benefits paid |000 staff and their|Initiatives to | | |Resource, |
| |by the insurer but not |qualifications have|improve procurement| | |Academic |
| |distributed to |been audited and |processes have been| | |Enterprise |
| |beneficiaries, R8 million|verified, policies |instituted and | | |and Financial|
| |to SARS in late payment |and job |measures to ensure | | |aid support. |
| |of PAYE. The initiation |descriptions and |that procurement is| | | |
| |of reviews of building |payroll costs have |conducted on the | | | |
| |costs, insurance costs, |been reviewed and |primary accounting | | | |
| |student residence leases |benchmarked |system are | | | |
| |as well as the status of |nationally. |underway. | | | |
| |all existing contracts |Audits of printing |Control over | | | |
| |against relevant |function, |expenditure has | | | |
| |legislation revealed |correctness of |been achieved | | | |
| |numerous anomalies |municipal and |through cost-saving| | | |
| |applying across all |telephone charges, |and cost | | | |
| |campuses. The |insurance and |reductions. | | | |
| |Administrator indicated |building costs. |Proper controls | | | |
| |that it is questionable |Review of student |over ring-fenced | | | |
| |whether WSU is receiving |residence leases |funds have been | | | |
| |value for money from |have revealed |instituted. | | | |
| |these contracts and |serious anomalies |The asset register | | | |
| |project managers. |and was further |was re-compiled and| | | |
| | |investigated. |a building | | | |
| | |Bank account |inventory and | | | |
| | |mandates have been |valuation has been | | | |
| | |changed so that |conducted and all | | | |
| | |money may only |conform with | | | |
| | |leave a bank |International | | | |
| | |account on the |Accounting | | | |
| | |signature of the |Standards. | | | |
| | |Administrator, |A new insurance | | | |
| | |Acting CFO and |framework has been | | | |
| | |independent member |implemented to | | | |
| | |of the Finance task|improve | | | |
| | |team. This is an |cost-effectiveness | | | |
| | |ongoing exercise |and financial | | | |
| | |and is being |security of | | | |
| | |managed robustly. |resources. | | | |
| | | |A new and more | | | |
| | | |cost-effective | | | |
| | | |process of student | | | |
| | | |insurance has been | | | |
| | | |implemented which | | | |
| | | |also includes | | | |
| | | |disability | | | |
| | | |insurance. | | | |
|Vaal |The Administratorâs Terms|The forensic audit |A review of the VUT|R931 900 |R931 900 |Budget of |
|Universit|of Reference included a |into the MPL |procurement process| | |R931 900 was |
|y of |forensic review of the |contract was |is underway and new| | |provided for |
|Technolog|appointment of a service |performed, followed|policies and | | |the |
|y (VUT) |provider as a strategic |by disciplinary |procedures as well | | |investigation|
| |and forensic |charges being |as a comprehensive | | |s and |
| |investigation of |instituted against |manual are at an | | |forensic |
| |residence management |the Vice-Chancellor|advance stage. | | |audits as |
| |affairs. |(VC). The VC was | | | |well as |
| | |formally found | | | |operating |
| | |guilty of | | | |costs. |
| | |misconduct and | | | | |
| | |received a final | | | | |
| | |written warning. | | | | |
| | |Forensic audits | | | | |
| | |were also conducted| | | | |
| | |into general VUT | | | | |
| | |procurement. No | | | | |
| | |major abuses were | | | | |
| | |uncovered. However | | | | |
| | |from the | | | | |
| | |investigation it | | | | |
| | |became clear that | | | | |
| | |VUT procurement | | | | |
| | |policies and | | | | |
| | |procedures were not| | | | |
| | |adequate. | | | | |
|Central |Two reports were received|On 13 August 2013, |Please see 2 (a) |No budget|No |Please see |
|Universit|from the CUT following a |Justice JP Daffue | |was |expenses |2(c) |
|y of |decision to appoint an |set aside the | |allocated|were | |
|Technolog|Administrator in June |Ministerâs decision| |. |incurred.| |
|y (CUT) |2012. The first report |to appoint an | | | | |
| |detailed the merits |Administrator | | | | |
| |and/or demerits of the |following CUTâs | | | | |
| |allegations contained in |review application | | | | |
| |the anonymous letter to |to declare invalid | | | | |
| |the Minister. In his |the Ministerâs | | | | |
| |report, Advocate Lubbe |decision to appoint| | | | |
| |found merit on most of |an Administrator. | | | | |
| |the allegations contained|Justice Daffue | | | | |
| |in the anonymous letter. |however ruled that | | | | |
| |He indicated that there |no sufficient | | | | |
| |was evidence of financial|justification | | | | |
| |irregularities at CUT, |exists to set aside| | | | |
| |however that whilst there|the Report of the | | | | |
| |is merit in the |Independent | | | | |
| |allegations, they were |Assessor. The | | | | |
| |not final and based on |Minister was | | | | |
| |any prima facie evidence.|granted leave to | | | | |
| |The KPMG report was never|appeal by the | | | | |
| |made available to the |Supreme Court of | | | | |
| |Minister during this time|Appeal on 21 | | | | |
| |and was only received |September 2012. | | | | |
| |after the appointment of |Following legal | | | | |
| |an Administrator. |advice received | | | | |
| | |from Senior Counsel| | | | |
| | |for the Department,| | | | |
| | |the Minister has | | | | |
| | |withdrawn his | | | | |
| | |appeal against the | | | | |
| | |judgment in light | | | | |
| | |of the enactment of| | | | |
| | |the Higher | | | | |
| | |Education and | | | | |
| | |Training Laws | | | | |
| | |Amendment Act, No. | | | | |
| | |23 of 2012. The CUT| | | | |
| | |Council has | | | | |
| | |appointed a | | | | |
| | |Commission of | | | | |
| | |Inquiry to complete| | | | |
| | |the investigate | | | | |
| | |undertaken by KPMG | | | | |
| | |and Advocate Lubbe.| | | | |
| | |The outcome of the | | | | |
| | |judicial inquiry, a| | | | |
| | |copy of the full | | | | |
| | |report and detail | | | | |
| | |of measures put in | | | | |
| | |place by the | | | | |
| | |Council will be | | | | |
| | |requested. | | | | |
|Universit|Following a report |The Chairperson of |The Minister have |R750 000 |R750 000 |DHET |
|y of |submitted by the Public |Council of the |met with the EXCO | | |contribution |
|Limpopo |Protector into alleged |University of |of the University | | |towards the |
|(UL) |maladministration and |Limpopo was |of Limpopo Council | | |forensic |
| |further submissions by |requested to |on 12 | | |investigation|
| |whistle blowers of |conduct a forensic |February 2013 to | | | |
| |financial irregularities |investigation into |discuss the | | | |
| |at UL, the Department |the allegations of |findings of the | | | |
| |requested the Council of |irregularities. It |forensic | | | |
| |UL to conduct a forensic |was also requested |investigation. The | | | |
| |investigation into |that this |Chair of Council | | | |
| |alleged irregularities on|investigation |presented the | | | |
| |financial |should be informed |managementâs | | | |
| |maladministration and |by an independent |response to the | | | |
| |poor governance at the |forensic |findings of the | | | |
| |University of Limpopo. |assessment. Ernst &|Forensic Audit at | | | |
| |The detailed report |Young were |this meeting. The | | | |
| |contained, amongst |appointed to |Department has | | | |
| |others, the following |conduct the |assessed the report| | | |
| |allegations of |forensic |as well as a | | | |
| |irregularities: |investigation. The |summary of the | | | |
| |Irregularities in the |copy of the report |findings, | | | |
| |appointment of senior |was submitted to |recommendations and| | | |
| |staff; |the Department on |managementâs | | | |
| |Mismanagement of funds; |21 January 2013. It|responses.. The | | | |
| |Harassment of managers; |was agreed that the|Minister has also | | | |
| |Disregard of processes |Department and |requested the | | | |
| |and policies; |University of |Council to provide | | | |
| |Fraudulent manipulation |Limpopo would share|a report that | | | |
| |of University records and|the cost for the |should include a | | | |
| |reports; |forensic |rectification plan | | | |
| |Undue influence and |investigation. |and implementation | | | |
| |conflict of interest; and|Ernst & Young |strategy with | | | |
| |Lack of work ethic. |charged a fee of R1|timelines, | | | |
| | |580 697 of which |indicating how the | | | |
| | |the Department paid|Council intends to | | | |
| | |R750 000 in terms |address and improve| | | |
| | |of this agreement. |internal control | | | |
| | |The cost for the |deficiencies in the| | | |
| | |forensic |human resources as | | | |
| | |investigation |well as the | | | |
| | |covered |procurement | | | |
| | |professional fees |functions, | | | |
| | |amounting to R1 567|including contracts| | | |
| | |031 and travel and |management and | | | |
| | |other expenses |financial | | | |
| | |amounting to R13|management. | | | |
| | |615. | | | | |
| | | | | | | |