Hon Minister of Public Works and hon Ministers and Deputy Ministers who are here, hon members, hon Chairperson, as the ruling party the ANC believes that the epitome of a successful government is good service delivery. However, in order for service delivery to be a success, it must uphold certain standards, such as grappling with core issues and leading to a spirited drive to respond to the needs of the people and to transform their lives for the better. Therefore, the department has a role to play in responding to these needs.
For the department to be able to fulfil its mandate of managing the accommodation, housing, land and infrastructure needs of the national departments, leading and directing the implementation of the EPWP and promoting growth, job creation and transforming the construction and property industry, it must have sufficient human capacity. We appreciate the progress made by the department to fill the vacant posts, as there was an improvement in the decline of vacancies from 22% to 16% in 2008-09. The department intended to fill all vacant funded posts by 30 June 2011.
Out of 1 363 vacant posts reported by the department in 2010-11, the department has been able to fill 420 posts. Although there was progress, we appreciate what has been indicated by the Minister, namely that the vacant funded posts will be filled as soon as possible. After all, if too much time is taken to fill vacancies or vacancies are not filled at all, service delivery will be impeded and the operation and performance of the department will be affected. We appreciate the commitment made by the department of intending to fill 95% of its posts over the Medium-Term Expenditure Framework, MTEF, period.
Section 38(1)(f) of the Public Finance Management Act, PFMA, Act No 1 of 1991, when read with Treasury Regulation section 8.2.3, mandates the department to pay creditors within 30 days from receipt of the invoice. This prompted the department to make a commitment by initiating the Reyapatala programme to adhere to these prescripts.
Progress has been made by the department as it was able to pay 66,7% of service providers on time, but it has to put more effort into ensuring that all service providers are paid within 16 days from receipt of the invoice to avoid interest accruing, which will result in wasteful expenditure and must be avoided at all costs. Minister, I think that in the 2010-11 financial year, R6,6 million was paid to service providers after 30 days. Payment of service providers on time will stimulate the growth of emerging and small enterprises.
One of the mandates of the department is to provide office accommodation to national departments and its entities. Therefore the department is expected to pay the landlords. The client departments should pay the Department of Public Works. From March 2008, the money owed by the departments was R419 million and R48 million was owed by entities. These amounts were outstanding for a period of more than two years.
As at February 2012, the department paid an amount of R3,4 billion to the landlords, but the department was able to pay back R2,5 billion, meaning that the outstanding amount is R839 million plus. These amounts keep on increasing year after year.
This problem of nonpayment by client departments is one of the factors that led to the department getting the disclaimer audit opinion. Furthermore, the failure of the departments to pay the Department of Public Works has a negative impact on the implementation of departmental programmes as it compromises service delivery and other programmes. The department, through the accounting officer, has to take appropriate action to make sure that the money owed is collected, and the portfolio committee and Treasury must intervene by calling all the defaulters to account.
There are other staff members who owe the department. In 2009-10, the amount owed was R4,5 million, which has increased to between R4,5 million and R9 million in 2010-11. The department has to make sure that this money is collected from the implicated staff officials.
We appreciate the fact that the department has been able to consistently spend over 90% of its budget. As the committee, we don't expect any underspending, but the spending of the department is satisfactory.
The supply chain management framework, when read with the preferential procurement policy framework of 2000, indicates that the procurement system must be fair, transparent, competitive and cost-effective. The department has to improve in terms of compliance. If quotations are needed for the procurement of goods, let it be so. If some officials ignore the policies, let disciplinary steps be taken on time against the transgressors. An amount of R1,2 million resulted in irregular expenditure because officials had deviated and failed to get quotations from bidders, as required by law, in the 2010-11 financial year.
Treasury regulation 9.1.1. indicates that accounting officers must take effective and appropriate steps to prevent and detect wasteful and fruitless expenditure and report to Treasury. Let the accounting officer comply with this regulation.
We appreciate the progress made by the department in ensuring that some employees declare their interests to the executive authority, as required by the Public Service regulations of 2000. Those who have not done so must do the right thing at the right time, failing which they have to be punished.
The department is commended for its efforts to increase revenue generation from R3,8 million in 2009-10 to R4,8 million in 2010-11. The intervention strategy to increase revenue generation has borne fruit. South Africa's major challenge is the shortage of skills. We appreciate the programme of the department to train interns in engineering and spatial planning through the infrastructure skills development grant. An amount of R281 million has been allocated over the medium-term expenditure framework to provide training to over 2 000 graduates. This programme and the department initiative of using retired built - environment professionals and certified artisans will bridge the gap in the shortage of technical skills, which are mostly needed by the department and municipalities to accelerate service delivery and to ensure effective implementation of infrastructural development. The revival of departmental workshops to train artisans in all the regional offices, in partnership with the Department of Higher Education and Training, will improve skills transfer and create jobs.
Considering the budget allocated for consultants - which is R55,5 million and which will increase during the MTEF period to between R61,6 million and R65,3 million in 2013-14, to provide support to municipalities in the implementation of infrastructural projects on the EPWP - the unlimited use, Minister, of consultants will compromise the transfer of skills and job creation, as you have indicated, while the department is in need of technical skills. Owing to the shortage of skills, the department has opted to use consultants. This is a good idea, but more focus must be placed on building internal capacity to minimise the overuse of consultants, which sometimes compromises job creation. That is because money that is supposed to be used to create jobs is spent on consultants. It is wasteful and fruitless expenditure to hire people to do the work, while, at the same time, continually appointing consultants to do the same jobs. Clear terms of reference, as you have indicated, should be developed for consultants to transfer skills. When they exit, the department should have the capacity to continue where the consultants left off.
The internal audit unit needs to be adequately resourced to ensure that the unit is able to identify internal control deficiencies and make recommendations on time. Also, the office of the chief financial officer needs to be capacitated to strengthen the internal controls to avoid cases of officials without the delegated powers signing for amounts to talling R1,6 million in 2010-11. Warning letters alone will not be a solution. The Public Finance Management Act, Act No 1 of 1999, was passed in 1999. It is now 2012, so no one can claim not to understand the Act.
Hhayi-ke, uma kunjalo Ngqongqoshe kumele wenze okuthile ngalokhu. [If that is the case, hon Minister, then you need to do something about it.]
Minister, you must act.
The Public Audit Act, Act No.25 of 2004, gives effect to the provisions of the Constitution of establishing and assigning functions to the Auditor- General to audit government departments at all levels and public entities and to report to Parliament. Minister, the Auditor-General has made some recommendations. Let those recommendations be implemented.
In conclusion, I want to indicate that the Employment Equity Act, Act No 55 of 1998, was passed to address disparities in employment, as has been said by my colleagues. Little has been done to recruit people with disabilities. However, the department has made some improvement.
Minister, I want to say that, as the ANC, we support this Budget Vote. While some people are dreaming of success, others, such as the ANC, wake up and work hard for it. The department is functional. Challenges are part of life, and we have to confront them. Minister, we trust the department. I thank you. [Applause.]