NATIONAL ASSEMBLY
FOR WRITTEN REPLY
QUESTION NO. 2574
DATE OF PUBLICATION IN INTERNAL QUESTION PAPER: 14 NOVEMBER 2014
(INTERNAL QUESTION PAPER NO. 25)
Mr M G P Lekota (Cope) to ask the Minister of Health:
Whether he has taken appropriate disciplinary and remedial action against
(a) management for under-spending the conditional grant of R257 million
intended for much needed improvement to the health infrastructure and (b)
the Compensation Commissioner for Occupational Diseases for yet again not
submitting its annual financial statements for audit purposes; if not, why
not, in each case; if so, what are the relevant details in each case?
NW3211E
REPLY:
a) Firstly, it is important to remind the Honourable Member that the
problems at the CCOD go as far back to a period prior to 2009 during
the time of the then Director-General of the National Department of
Health. The Portfolio Committee on Health had also noted the serious
challenges at the time and raised its concerns very sharply, towards
the management of the CCOD at the time, which rested on the
responsibility of the then Director-General of the National Department
of Health.
Some of the key challenges that the above provinces reported to be the
reason for the under spending on the conditional grant are as follows:
⢠Poor management of projects by the implementing agent, which is the
Department of Public Works. There are delays in the awarding of
tenders and appointment of contractors, as a result, projects get
affected leading to under-spending. This challenge has been noted
to be the common course of poor spending in most provinces;
⢠The other challenge that the provinces reported was the significant
delays with the procurement process by the internal supply chain
management units. The procurement processes by the implementing
agent remains a big challenge that still requires urgent
intervention by the National Department of Health;
⢠The poor spending by the Limpopo Province mainly comes as a result
of contractual issues with both the previously appointed
implementing agent Sakhiwo and the newly appointed implementing
agent IDT which is performing very poorly;
⢠Another challenge relating to the provinces under-spending is the
fact that there are outstanding invoices from contractors that have
not been paid, owing to outstanding issues, processes or non-
compliance according to Supply Chain Management rules and
procedures;
⢠Lack of infrastructure human resource (capacity) to properly
monitor the projects, particularly in both Free State and Limpopo
provinces. The Infrastructure unit is operating with very limited
staff and that makes it difficult to conduct regular site visit to
the facilities as part of monitoring. Limpopo has reported to have
started the process of appointing technical staff and the process
is still underway. In the Free State the post of Infrastructure
Manager has not been filled. The Unit in the previous financial
year was being managed by an Acting Manager.
Owing to the abovementioned factors, no disciplinary actions were
taken against management for the under-spending of the conditional
grant.
b) For many years the management of the Compensation Fund was neglected
which had lead to adverse audit findings. Efforts were made by the new
management of the CCOD restructure the institution so that it is able
to fulfill its mandate. The transformation plans were discussed at
length with the Portfolio Committee on Health who have given the CCOD
their full support and have noted the significant progress that has
been made over the past two years. These plans are being driven by a
new management team. The team is working hard to clear the backlog of
applications however this task is not complete. Without the backlog
being cleared it is not possible to do an actuarial evaluation of the
Fund and this affects the submission to the Annual Financial Statement
and Annual Report of the CCOD for the 2014/15 Financial Year. It is
anticipated that it will take another 6 months to overcome the claims
assessment backlogs, reconcile payments and revenue with source
documents and undertake an actuarial valuation of the Compensation
Fund in preparation for the audit of the Fund by the Auditor-General
of South Africa. A Chief Financial Officer and an Internal Audit team
will begin duty in December 2014. Given the progress made in the past
two years to restructure the Fund there is no justification for taking
any action against the Commissioner. It is worth noting that the
contract of the previous commissioner had been terminated due to poor
performance.
Actually the present Commissioner was brought in to clear the mess of
the previous Commissioner whose contract had to be terminated. I
believe that the present Commissioner is actually carrying out that
job of cleaning up in a sati sfactory manner.
END.