Budgetary Review and
Recommendation Report (BRRR) of the Portfolio Committee on Home Affairs on the
performance of the Department of Home Affairs and its entities for the 2013/14 financial
year, dated 23 October 2014
1. Introduction
As
specified by section 5 of the Money Bills Amendment Procedures and Related
Matters Act (MBAP) of 2009, the National Assembly, through its Committees, must
annually assess the performance of each national department with reference to
the following:
·
The medium term estimates of
expenditure of each national department, its strategic priorities and
measurable objectives, as tabled in the National Assembly with the national
budget.
·
The expenditure reports relating
to such departments published by the National Treasury in terms of section 32
reports of the Public Financial Management Act (PFMA).
·
The financial statements and
annual report of such departments.
·
The report of the Committee on
Public Accounts relating to the department.
·
Any other information requested
by or presented to a House or Parliament.
A
Committee must submit the Budgetary Review and Recommendation Report (BRRR)
annually to the National Assembly which assesses the effectiveness and
efficiency of the department’s use and forward allocation of available
resources and may include the recommendations on the use of resources in the
medium term.
The
Committee must submit the BRRR after the adoption of the budget and before the
adoption of the reports on the Medium Term Budget Policy Statement (MTBPS) by
the respective Houses in November of each year.
The
Portfolio Committee on Home Affairs (the Committee) considered its Budget
Review and Recommendation Report which was adopted by the Committee on 23
October 2014.
In line
with the core objectives of Parliament the mandate of the Committee is to:
· pass
legislation;
· oversee
and scrutinise executive action;
· facilitate
international participation;
· facilitate
co-operative government; and
· Facilitate
public participation and involvement.
On the
basis of challenges and problems encountered by the Committee in its oversight
and from the 2014 State of the National Address and National Development Plan;
key issues were put forward by the Committee covering the following entities: The
Department of Home Affairs (DHA), the Electoral Commission (IEC) and the
Government Printing Works (GPW). The Film and Publications Board (FPB) has been
moved from the DHA to the newly created Department of Communications.
The Report of the Committee is based primarily on the following
activities:
·
Briefings by Departments and
Committee deliberations.
·
Conducting Research.
·
Drafting, consideration and
voting on internal reports.
·
Scrutinising Strategic and Annual
Performance Plans, State of the Nation Address, Ministers’ speeches and Policy
documents.
·
Assessing Estimates of National
Expenditure, Medium Term Expenditure and budget allocations.
·
Scrutinising external briefings
and reports.
·
Conducting oversight visits.
·
Public participation during
constituency periods and committee meetings.
The
mission of the DHA is to ensure the efficient determination and safeguarding of
the identity and status of citizens and regulation of migration to ensure
security as well as to promote and fulfil South Africa’s international
obligations. This mandate is administered through the following three
overarching budget programmes:
Programme 1 - Administration:
The programme provides leadership, management and support services to the
Department of Home Affairs.
Programme 2 - Services to
Citizens: The programme provides secure, efficient and accessible services
and documents for citizens and lawful residents. This programme now also
includes the transfers to the IEC and GPW.
Programme 3 - Immigration
Services: The programme facilitates and regulates the secure movement of
people into and out of the Republic of South Africa through ports of entry,
determines the status of asylum seekers, and regulates refugee affairs. It also
confirms and provides enabling documents to foreign visitors legally residing
within the Republic of South Africa and enforces immigration legislation and
effects deportations.
National
government has fourteen outcomes and the DHA contributes to four of these
outcomes, which comprise 11 strategic objectives for 2013/14 - 2014/15. The
three/four outcomes are as follows:
Strategic Objective |
Outcome
1: Secure South African citizenship & identity. |
|
1.1 |
To ensure that
registration at birth is the only entry point for South Africans to the
National Population Register (NPR). |
|
1.2 |
To issue Identity
Documents (IDs) to citizens turning 16 years of age & above. |
|
1.3 |
To ensure the
registration & identification of all South African citizens, foreign residents,
refugees & asylum seekers to enhance the integrity & security of
identity. |
|
Outcome
2: Immigration managed effectively & securely in the national interest
including economic, social & cultural development. |
||
2.1 |
To ensure a secure,
responsive & flexible immigration regime in support of national security,
priorities & interests. |
|
2.2 |
To implement
effective & efficient asylum seeker & refugee management strategies
& systems. |
|
2.3 |
To facilitate the
efficient movement of bona fide travellers to support national interests
& priorities, & to prevent & prohibit the movement of undesirable
persons in the interest of national security. |
|
2.4 |
To contribute
towards realising a positive skills migration trend of around 50 000 migrants
annually. |
|
Outcome
3: A service that is secure, efficient, and accessible corruption free. |
||
3.1 |
To transform the
culture of the organization in support of securing identity, citizenship
& international migration. |
|
3.2 |
To ensure ethical
conduct & a zero tolerance approach to corruption. |
|
3.3 |
To obtain a clean
audit report. |
|
3.4 |
To ensure secure,
effective, efficient & accessible service delivery to clients. |
2.1. The Department’s
Contribution to the National Development Plan (NDP)
A
major focus of the NDP is to confront the triple challenge of poverty,
inequality and unemployment by achieving higher growth rates. The DHA priority
is to facilitate the acquisition of the critical skills needed for the economic
growth and to build our own skills base.
The
DHA could play a key role in enabling regional development by working with
Southern African Development Community (SADC) countries to establish efficient and
secure management of the movement of people. The inclusion of all citizens in
democracy and development is enabled by providing them with a status and an
identity that gives them access to rights and services.
The
DHA’s modernisation programme can reduce fraud and the cost of doing business
by enabling e-government thus attracting more investment.
2.2. Key challenges faced by the DHA
The
DHA identified the following as challenges in the department:
·
The systems have been outdated
and not integrated thus compromising security and service delivery. In addition
there are repeated delays in the finalising of these systems due to various
administrative issues;
·
There has been a high vacancy
rate for legal specialists and senior managers, and the Department has not yet
created a culture of professionalism;
·
Continued high dependency on the
Department of Public Works (DPW) for building and procuring accommodation;
·
The uneven quality of
administration and governance processes between provinces and offices creates
risks and compromises the effective management of people and resources.
·
Constant risks and threats to
civil registration, identity and immigration systems from local and
transnational criminal syndicates;
·
Policy, legislation and
regulations in a number of areas require further review and updating; and
·
Immigration capacity and systems have
not been aligned with a strategic, risk-based approach.
2.3. The Strategy to transform
the DHA
In
support of achieving the strategic objectives of the DHA, government priorities
and the NDP, the DHA has identified the following goals over the next 3 - 5
years:
·
The effective management of
immigration to contribute to security and development;
·
The establishment of a
comprehensive and secure National Identity System (NIS);
·
Modernizing Home Affairs through
investing in people, processes and technology;
·
Improving service delivery and
promoting good governance and administration;
·
Developing officials that are
ethical, patriotic and professional, and
·
Visible and firm action in the
fight against corruption.
2.4. Highlights of the DHA over
the 2009 – 2014 period
These
are the highlights of the DHA over the five - year period:
·
The Department was able to deliver
all the 2010 FIFA World Cup commitments to a high standard;
·
The National Population
Registration Campaign was conducted through communities and recorded over 1
million citizens and reduced late birth registration. The Department is
planning to discontinue late registration of birth by December 2015;
·
Amended Civics and Immigration
legislation to address serious security gaps and improve service delivery
including to the vulnerable groups;
·
The security of birth certificates
had been improved and front offices were able to print unabridged birth
certificates from 4 March 2013;
·
The Department has centralised
adjudication for permits and visas. This has reduced fraud and corruption;
·
The stakeholder forums were
formed across the country so that communities, local government and departments
mobilise support for the delivery of DHA services;
·
There was a major breakthrough in
the design and development of new systems, including the rollout of a Smart ID
Card. Over 700 000 Smart ID Cards were issued to citizens;
·
The refurbishment programme continued,
and included the transformation of 70 paper-based offices to a new fully
digital process for IDs and passports;
·
Access was granted to institutions
such as the banking sector, the South African Social Security Agency (SASSA)
and the Justice System to verify identity presented to them for services;
·
The enhanced real-time movement
control system (e-MCS) was rolled out to additional ports of entry; Capacity
was strengthened at the largest ports with a focus on the maritime environment;
·
The Learning Academy was
developed to deliver dedicated DHA professional courses and induction. Human
Resources introduced leadership and cadre development and mentoring; and
·
The footprint and channels was
expanded in respect of offices, connected health facilities and client service
centres.
Title of Plan |
Years Covered |
National Outcomes |
Strategic Objectives |
Indicators/ Targets |
Strategic Plan 2010/11 – 2012/13 |
3 |
3 |
14 |
48 |
Strategic Plan 2011/12 – 2013/14 |
3 |
3 |
14 |
48 |
Annual Performance Plan 2012/13– 2014/15 |
3 |
3 |
11 |
53 |
Annual Performance Plan 2013/14 – 2015/16 |
3 |
3 |
11 |
37 |
Annual Performance Plan 2014 – 15 |
7 |
5 |
9 |
35 |
Three of the
12 Government Outcomes have remained directly relevant to Home Affairs for the
past number of years as reflected in its Strategic and Annual performance plans
and reports:
Outcome 3 : All people in South Africa feel safe;
Outcome 5 : A skilled and capable workforce; and
Outcome 12 : An efficient development oriented public
service.
The below two
new priority Government outcomes for the 2014 to 2019 period are also relevant
to the DHA:
Outcome 4 : Decent employment through inclusive
economic growth; and
Outcome 14 : Nation building and social cohesion.
Although outcome
four has not yet been included as a priority by the DHA in the Annual
Performance Plan, the DHA does have a potential to impact on growth through the
importing of critical skills and ensuring the monitoring of standards and
documents for employment of immigrants. This in turn contributes to Outcome 14
on social cohesion. The DHA has linked outcome 14 to the provision of documents
within a timely manner to Citizens and Residents. This facilitates nation
building and social cohesion by allowing access to services, a sense of
identity for citizens and allows for the formal protection of migrants and
better integration in South Africa.
In
September 2014 the DHA presented on its first quarter expenditure and progress against objectives (April to June
2014). The following expenditure was recorded by the DHA for this period:
Notes: In terms of the
linear projections, the department should be spending at 25 % as at June 2014. The VOTE is spending at 29% primarily due to
the higher allocations given to the IEC in preparation for the National
Elections.
First Quarter Progress
included:
·
There were 208, 000 smart ID cards issued to citizens
16 years and older.
·
Smart IDs issued within 15 working days.
·
IDs (First issues) issued within 54 working days: 95%.
·
IDs (Re-issues) issued within 47 working days: 95%.
·
Staff vacancy rate was maintained at below 10% (6.6%
in 2013/14).
·
A project was launched to develop a management toolkit
for frontline offices.
·
A Border Management Agency (BMA) feasibility study has
commenced.
·
A project to survey communities along the borderline has
commenced.
·
An immigration policy discussion paper was refined
based on research.
·
Sixty two per cent of business, critical skills and
general work permits adjudicated within 8 weeks.
Challenges
raised for the first quarter were:
·
Progress on decision for relocation of Refugee Centers
to the borderlines was unclear.
·
Only 50% of permanent
residence
applications were adjudicated within 8 months.
·
Significant work was required in overhauling the
permitting system and border management, including amendments to Immigration
legislation and privatization of visa applications.
·
Dependency on Departments of Public Works for buildings
and SITA for connectivity of new systems such as live capture ID and passport
applications.
·
Persistent delays in integration of IT systems.
·
Difficulty in digitizing
all records so that they were electronically readable.
·
Lack of capacity in critical areas such Inspectorate.
·
Continued fight against unlawful activities.
·
Difficulty improving administration, especially
financial management.
·
Ensuring all staff were appropriately trained,
professional and caring.
5.
ANALYSIS OF THE DEPARTMENT’S ANNUAL REPORT AND FINANCIAL STATEMENTS
The analysis of the
annual report for 2013/14 seeks to review whether the DHA fulfilled its
constitutional mandate and what successes and challenges it has encountered.
This is done by highlighting aspects of:
· Key findings of the Presidential Monitoring and Evaluation Department's
moderated assessments on the quality of management practices;
· The Auditor-General’s (AG) Report over the last 5 years;
· The performance against targets in each of the Departments three
programmes; and
· Financial statements of the DHA in relation to its stated strategic
objectives and previous year’s performance.
The analysis is in
accordance with section 55(2) of the Constitution (Act 108 of 1996) which
empowers Parliament to provide mechanisms to “ensure that all executive organs
of state in the national sphere are accountable to it”. In order to improve
oversight, the focus is on areas not highlighted by the DHA and thus
achievements are under-represented.
5.2 Selected Performance and Finances by Programme
The DHA reported
fully achieving 53% or 20 of the 38 performance indicators it set for 2013/14.
This was more than double what was achieved in 2012/13 and 2011/12 (26%),
albeit with 12 fewer performance indicators than before. The total DHA budget
including additional funds but excluding funds for the entities (Electoral
Commission, Government Printing Works and Film and Publications Board) was R5.2
billion compared to R4.27 billion in 2012/13. Without transfer to agencies, the
DHA budget thus increased by 20% or 14.4% above 2013/14 inflation. A doubling
in reported performance indicators achieved was notable given only 14.4% real
increase in budget.
Despite reporting
achieving around half its performance indicators, unlike in 2012/13 the AG had
indicated that there was a considerable lack of information provided to support
performance indicators provided. Information was not always valid, accurate,
complete or reliable. This, according to the AG, was due to lack of review of
source documentation and inadequate record keeping. The Director General in the Report of the Accounting
Officer on page 16 of the Annual Report indicated that auditors acknowledged an
improvement in the formulation of performance indicators, but it was uncertain
what this referred to. The Director General (DG) also indicated that achieving
other performance indicators was negatively impacted on by the higher than
anticipated costs for implementing the priority Smart ID smart card project.
The Presidency
Management Performance Assessment Tool published in 2014 included a case study
of Home Affairs on the issue of Governance and Service Delivery during 2013.
The Presidency indicated that national departments still do not comply with
Department of Public Service and Administration (DPSA) requirements for Service
Delivery Improvement Plans (SDIP). The DHA scored at only level 1 out 4 despite
significant interventions to improve service delivery for issuing of identity documents
(IDs) and passports.
The Presidency
case study indicated that officials in Home Affairs show a growing commitment
to more structured improvements. This it said, should be reflected in a full
Service Delivery Improvement Plan (A SDIP was reported on in the Annual Report
on page 35 but it was unclear if this was implemented in 2013/14 or not or if
the goals for this plan were adequate).
The DHA plans and
reports both in terms of budget programmes and results based outcomes relating
to National Priorities. The budget programmes are Administration, Citizen
Affairs and Immigration Affairs. Depending on which grouping of performance
indicators is chosen, different achievements can be highlighted by the DHA.
Performance indicators achieved in outcomes are compared below to performance
indicators in Budget Programmes.
DHA performance indicators arranged by outcome vs by programme
Outcome and Programme |
No. of Performance indicators |
Achieved |
Partially Achieved |
Not Achieved |
Outcome 1: Secured South African Citizenship and Identity. |
14 |
7 (50%) |
1 |
6 |
Programme 2: Citizen Affairs |
10 |
7 (70%) |
|
|
Outcome 2: Immigration managed efficiently and securely in the
national interest including economic, social and cultural development. |
10 |
7 (70%) |
3 |
0 |
Programme 3: Immigration |
14 |
6 (43%) |
|
|
Outcome 3: A service that is efficient, accessible and corruption free.
(All Programmes) |
14 |
6 (43%) |
0 |
8 |
Programmes 1: Administration: |
14 |
7 (50%) |
|
|
TOTALS |
38 |
20 (52%) |
4 (10.5%) |
14 (37%) |
Programme 1: Administration - Seven of 14
(50%) targets were reportedly achieved (compared to only 23.5% of performance
indicators achieved in 2012/13). This was a return to 2011/12 performance where
50% of performance indicators were achieved. The reliability of the performance
indicators presented for the Administration programme were questioned by the AG
in 2011/12 and 2012/13 in that they did not always equate with the source
information/evidence provided. This programme was not selected for a
performance audit in 2013/14, but given the performance in the past and in the
other two programmes, it could be assumed that reliability of information
remained a concern.
As a result of the increased budget allocation to the DHA in 2013/14;
all programmes including Administration grew in expenditure. The Administration
programme, which accounted for the 28.5 % of the DHA 2013/14 initial
appropriation, received a 12.7 % real increase (after inflation) of R199.8
million. This was due to significant increases in allocation for Office
Accommodation (37%) and Transversal Information Technology (22%). The latter
increased allocation translated into the achievement of the target of rolling
out live capture for passports and IDs to 70 offices.
Programme 2: Civic Services - The
Accounting Officer reported 7 of 10 performance indicators being achieved
(70%). This compares well to only 31% of performance indicators achieved in
2012/13 and only 21% of performance indicators achieved in 2011/12. This was again
the best performing of the three programmes of the DHA. However, the AG had again
indicated that significant performance indicators within the programme were
misstated due to inadequate review of reported achievements against source
documents provided.
Citizen Affairs comprised 61.6% of the DHA budget for 2013/14. The
programme increased 19.7% in real terms compared to 2012/13. This was largely
due to the increase allocated to the Electoral Commission for the 2014
election. The Film and Publications Board also showed an increase of 12% (R8.5
million) in real terms. The Government Printing Works budget was reduced by 6%
in real terms. There was also a 31% (R10 million) real decrease in the Citizen
Affairs Management sub-programme.
Without the Electoral Commission (IEC) allocation, the increase to
Citizen Affairs overall was only 0.28% above inflation (a 5.9 % nominal
increase) after receiving 14% less in real terms from 2011/12 to 2012/13. More
than doubling the reported performance indicators achieved with a just over
inflation related budget increase, if accurate, is commendable.
Programme 3: Immigration Services,
managed to fully achieve only 6 of the 14 performance indicators for the
programme (43%). This, although low, was still a significant improvement on
2012/13 where only 19% and 2011/12 where only 6% was achieved. When viewing
Immigration in terms of government outcomes rather than the performance
indicators for the budget programme, 7 out of 10 performance indicators were reportedly
achieved (70%). This was when performance indicators relating to achieving “a
service that is efficient, accessible and corruption free” were considered as a
separate outcome. Improvements of the Immigration Programme must therefore
focus on efficiency, accessibility and lowering corruption.
The DHA indicated rolling out an additional 13 Ports of Entry with the
new Enhanced Movement Control System (EMCS). This was a significant improvement
for security. Based on previously reported achievements this brought the total
number of EMCS equipped ports to 61 out of 72 (84%). The need for the
integrating biometric (fingerprint and/facial) recognition to enhance security
and prevent fraud was not piloted as planned during 2014/15 due to an unanticipated
technical complexity. The roll out of the EMCS to the remaining 11 ports of
entry did not appear as part of Annual Performance Plans but the DG had
indicated that they would be finalised by the end of the 2014/15 financial year.
The difference between the number of foreign nationals arriving and
departing South Africa decreased to 8.5% (1.2 million persons) in 2013/14 from
the previous 13% more arrivals than departures in 2012/13. This was even though
overall traffic grew each year. Whilst finalised applications for Permanent
Residence drastically improved from 13% to 48.7% out of 39 000 applications;
Temporary Residence Permits declined from 50% to 28%. In terms of the strategic
objective to achieve 20 000 permits to migrants with scarce skills it was reported
that the target was not achieved due to a delay in a scarce skills list being
finalised. It was not indicated what number of skills were in fact imported, if
any.
Immigration services accounted for 10% of the total budget received by
Home Affairs in 2013/14. The programme received a 6.23% increase in 2013/14
compared to a 4.2% decrease from 2011/12 to 2012/13. This equated to a R36
million real increase. This increase was mostly due to the 22% (R43.4 million)
real increase in the allocation to the Admission Services sub-programme. Two
sub-programmes: Immigration Management and Asylum Seekers both got a real cut
of around 10%. The performance of the programme also needs to be considered
against the fact that 21% of the budget allocation was used in the other two
programmes (through a virement of R174 million from its R821 million final
Appropriation). The continued low performance on Refugee and Immigration - related
performance indicators was no doubt compounded by the prioritisation of funds
to the other programmes like the Smart ID in Citizen Affairs. The Committee has
been informed of a Report of the Human Rights Commission on the Lindela
Repatriation Facility and will address the content in its work going forward..
5.3 Overview of Auditor-General report
The Auditor General’s (AG) report, in the annual reports of government
departments and entities, spoke to the reliability of information contained in
the report as well as achievement of performance indicators. The AG’s report is
divided into:
A.
Audit opinion;
B.
Emphasis of matters
C.
Predetermined Objectives
D.
Other Non-Compliance
A. AUDIT OPINION
In 2013/14 the AG was unable to
find adequate information in ten
main areas for the DHA.
The AG was unable to obtain
sufficient appropriate audit evidence for the financial statement items as
described below, due to the status of the accounting records. The department
did not have adequate systems of internal control in place for the recording of
all transactions and events and further could not reconcile the transactions
and events to the financial statements. The AG could not confirm the financial
statement items below by alternative means and was unable to determine whether
any adjustment to these financial statement items was necessary. Two significant
repeat concerns are detailed first.
1.
Accruals –This was a continued area of concern from previous years. Insufficient evidence was available to
verify outstanding balances due to other Departments for Services Accrued by the DHA
for a total of R200.9 million (R199.5 million in 2012/13). This was again
comprised primarily of money due to the Department of International Relations
(R176 million) for services accrued by the DHA. Other significant unverifiable
accruals were R19.3 million from the Department of Public Works and R5.4
million to the Department of Justice and Constitutional Development.
2.
Movable and Tangible Assets – This was a cumulative issue emerging in 2012 where inadequate records were available for major tangible assets valued
at R1.19 billion (including the 2013 amount of R1.042 billion and minor assets
of R197 million). This related mostly to computer equipment valued at R806.9
million and transport assets valued at R211 million.
3.
Departmental revenue – stated at R741.6 million (2013: R682.1 million).
4.
Payables – arising from unallocated cash receipt transactions stated at R646.8
million (2013: R537.6 million).
5.
Accrued departmental revenue – stated at R275.4 million (2013: R796.4 million).
6.
Contingent asset disclosure note – stated at R817.3 million (2013: R554.4 million).
7.
Contingent liabilities – arising from unconfirmed claims payable balances, stated at R98.6
million (2013: R105.2 million).
8.
Intangible assets – The department did not
maintain complete and proper records of intangible assets. The AG was unable to
obtain sufficient appropriate audit evidence that the amounts disclosed in note
29 to the financial statements were all recorded at the correct values. The AG
was unable to confirm the balances by alternative means. Consequently, the AG
was unable to determine whether any adjustment to intangible assets stated at
R897.1 million in the financial statements was necessary.
9.
Immovable assets – The department did not
maintain complete records of refurbishments on leased property. The AG was
unable to obtain sufficient appropriate audit evidence on the amounts disclosed
in note 30 to the financial statements as the refurbishments that were
completed in the years 2009 to 2014 were not capitalised to immovable assets. The
AG was unable to confirm the balances by alternative means. Consequently, the
AG was unable to determine whether any adjustment to immovable assets stated at
R4.6 million (2013: R0.0 million) in the financial statements was necessary.
10.
Commitments – The AG was unable to obtain sufficient, appropriate audit evidence for
commitments as the department did not maintain accurate and complete records of
the contractual information used to calculate the commitments balance. The AG could
not confirm the amounts by alternative means. Consequently the AG was unable to
determine whether any adjustment to commitments stated at R2 685.7 million was
necessary.
Below is a summary of the AG’s findings for Vote 4: Home Affairs
DESCRIPTION |
09-10 |
10-11 |
11-12 |
12-13 |
13-14 |
Audit opinions |
|
|
|
|
|
Department of Home Affairs
(DHA) |
Qualified |
Unqualified |
Qualified |
Qualified |
Disclaimer |
Government Printing Works |
Unqualified |
Unqualified |
Unqualified |
Unqualified |
Unqualified |
Electoral Commission |
Qualified |
Unqualified |
Unqualified |
clean |
Unqualified |
Areas of qualification |
|
||||
·
DHA |
|
|
|
|
|
Accrued
Departmental revenue |
|
|
|
X |
X |
Revenue |
|
|
|
X |
X |
Payables |
|
|
|
X |
X |
Contingent
asset |
|
|
X |
X |
X |
Contingent
liabilities |
|
|
|
X |
X |
Accruals |
|
|
|
X |
X |
Employee
benefits |
|
|
|
X |
|
Capital
assets |
X |
|
|
X |
X |
Immovable
assets |
|
|
|
|
X |
Intangible
assets |
|
|
|
|
X |
Commitments |
|
|
|
|
X |
Other findings |
|
|
|
|
|
· Pre-determined
Objectives |
|
|
|
|
|
Department
of Home Affairs |
|
X |
X |
X |
X |
Government
Printing works |
X |
X |
|
|
|
Electoral
Commission |
X |
X |
|
|
X |
· Compliance |
|
|
|
|
|
Department
of Home Affairs |
X |
X |
X |
X |
X |
Government
Printing works |
X |
X |
X |
X |
X |
Electoral
Commission |
X |
X |
X |
|
X |
B. EMPHASIS OF MATTERS
1.
Financial reporting framework – As disclosed in the accounting policy notes 7.2 and 16.2 to the
financial statements, the National Treasury had exempted the department from
applying the applicable accounting framework in respect of foreign revenue
transactions and certain assets for the reasons indicated.
2.
Restatement of corresponding
figures – As disclosed in note 31 to the
financial statements, the corresponding figures for 31 March 2013 have been
restated as a result of an error discovered during 2014 in the financial
statements of the DHA at, and for the year ending, 31 March 2013.
3.
Significant uncertainties – With reference to note 18 to the financial statements, the DHA was the
defendant in various claims against the department. The department was opposing these claims. The
ultimate outcome of these claims cannot presently be determined and no
provision for any liability that may result has been made in the financial
statements.
4.
Payables – Payables which exceed the
payment term of 30 days as required in Treasury Regulation 8.2.3 amounted to
R28.8 million. This amount, in turn, exceeded the voted funds to be surrendered
of R2.2 million as per the statement of financial performance by R26.6 million.
The amount of R26.6 million would therefore have constituted unauthorised
expenditure had the amounts due been paid in a timely manner.
C. PREDETERMINED OBJECTIVES
Entity |
Finding |
Root cause |
Recommendation |
DHA |
Programme 2 – Citizen Affairs Usefulness of reported performance information Presentation of performance information: No reasons for variances between planned and actual
achievements reported in the annual performance report were given for 50% of
the targets that were overachieved, as required by the National Treasury’s
Guide for the preparation of the annual report. This was due to management
not analysing and reporting on the reasons for overachieved targets. Consistency of objectives Treasury Regulation 5.2.4 requires the strategic and
annual performance plan to form the basis for the annual report, therefore
requiring consistency of objectives, indicators and targets between planning
and reporting documents. A total of 20% of the objectives reported were not
consistent with those in the approved strategic and annual performance plans.
This was due to a limited review and reconciliation of the strategic planning
objectives to the objectives per the annual performance report. Reliability of reported performance information The
FMPPI requires auditees to have appropriate systems to collect, collate,
verify and store performance information to ensure valid, accurate and
complete reporting of actual achievements against planned objectives,
indicators and targets. The reported performance information was not valid,
accurate and complete, for significantly important targets, when compared to
the source information or evidence provided. This was due to a lack of
frequent review of the validity of reported achievements against source
documentation. Programme 3 - Immigration Affairs Reliability of reported performance information The
FMPPI requires auditees to have appropriate systems to collect, collate,
verify and store performance information to ensure valid, accurate and
complete reporting of actual achievements against planned objectives,
indicators and targets. I was unable to obtain the information and
explanations I considered necessary to satisfy myself as to the reliability
of the reported performance information. This was due to limitations placed
on the scope of my work due to the fact that DHA did not maintain a proper record
keeping system. |
Limited review and reconciliation of the strategic planning objectives
to the objectives of the annual performance report. Lack of frequent review of the validity of reported achievements
against source documentation. This was also due to limitations based on the scope of work due to the
fact that DHA did not maintain a proper record keeping system and therefore
information was not submitted on time. Management has not implemented adequate controls over daily and
monthly processing and reconciling of transactions. The data captured on
track and trace is not adequately reviewed to ensure its accuracy. Reasons
for the late capturing of application forms have not been noted or recorded
on the application forms. No formal training was done on the implementation of a new
function. Internal audit does not adequately review the reports utilized
for performance reporting for validity, accuracy and completeness. There are
no formally documented standard operating procedures for the process, which
could lead to the reported information not properly checked for validity,
accuracy and completeness. |
• The National Treasury Annual Report Guide
is clear that reasons for all deviations should be disclosed. The department
must adhere to the requirements per National Treasury report guide. Comments
for both underachieved and overachieved targets must be provided per National
Treasury Annual Report Guide requirements. • The monitoring and evaluation section and
internal audit must review the annual performance report to ensure that all
the requirements of the National Treasury Annual Report Guide are adhered to. • The annual performance plan and the
annual report must be thoroughly reviewed by the monitoring and evaluation
section to ensure consistency between the planned and reported objectives. • Internal audit must review the annual
performance report to ensure that all the reported information is valid,
accurate and complete. • Changes to the annual performance plan
must be appropriately approved, communicated and disclosed. • The entities should define up front which
supporting documentation will be required and by when, and an independent
verification by the respective entity’s internal audit unit should be
performed on the validity, accuracy and completeness of reported information. • There should be monthly reconciliations
of performance results to have accurate real time information available to
support management’s decision-making. • Processes that provide for the collation,
verification and storage of information for performance reporting must be
adopted and communicated throughout the organization so that the information
is easily retrievable. • Training must also be provided where
necessary to ensure that the relevant people understand what is required. • Exceptional cases for the late capturing
of application forms must be properly noted on the application form and must
be accompanied by supporting documentation. • Clear review and reporting processes must
be established between the service providers and DHA management. • Monitoring and evaluation section must
ensure that there are proper project plans for the targets that are set on
the annual performance plan with adequate resources that will ensure that the
targets are achieved. • Formal standard operating procedures must
be established. |
IEC |
Programme 2 – Outreach Reliability
of reported performance information The FMPPI
requires auditees to have appropriate system to collect, verify and store
performance information to ensure valid, accurate and complete reporting of
actual achievements against planned objectives, indicators and targets.
Adequate and reliable corroborating evidence could not be provided for 24.1%
of the targets to assess the reliability of the reported performance
information. The auditee’s records did not permit the application of
alternative audit procedures. This was due to the absence of information
systems to collect, verify and store performance information. |
Financial and performance management Inadequate and ineffective
internal controls were implemented to ensure proper record keeping in a
timely manner was implemented to ensure that complete, relevant and accurate
information is accessible and available to support the actual number of civic
and democracy education events as reported in the Annual Performance Report. Inadequate review processes
were implemented to ensure that the actual performance reported in the Annual
Performance Report submitted for audit purposes are valid, accurate and
complete. |
The Electoral Commission should
ensure that all documentation is kept and easily retrievable as per the FMPPI
and be provided upon request within the agreed upon time. The Electoral Commission should
ensure that a process is developed and implemented where by data originating
at a provincial level are collated and reviewed for validity, accuracy and
completeness by the Senior Manager (responsible person per the published
technical indicator description) before including this in the actual value
reported in the Annual Performance Report. |
GPW |
No Findings on
predetermined objectives. |
|
|
|
5.4 Human
Resources
The overall
vacancy rate in the Department had declined from 10.3% and higher in previous
years to 6.6% in 2013/14 (In total there were 680 vacancies out of the
10 344 total approved posts). The highest vacancy rate was in the
Administration programme at 9.4%. Citizen Affairs had the highest number of
vacancies since it was the biggest programme with the matching highest number
of employees: 514 out of a total establishment of 8335.
The Auditor
General had again indicated that HR had not advertised funded vacant posts
within six months of their becoming vacant and not filling them within 12
months as required by Public Service Regulations. Only partial information was given
in this regard on the period taken to appoint vacant posts and this was only
for senior management. The DHA indicated in the 2012/13 annual report that
robust steps would be implemented to ensure compliance with leave and
absenteeism management. However, the AG had again indicated that the Accounting
Officer (the Director General) had not ensure that all leave taken by employees
was accurately recorded as per the regulations.
In terms of
critical occupation categories, there was a high vacancy rate of 21% for Legal
Related Occupations, which was concerning given the ongoing large scale legal
cases and amendments to legislation which would be needed in the coming years.
The vacancy rate
for senior management, particularly at
Deputy Director General and Chief Director level was significantly
higher than average at 30% and 23% respectively. The turnover rate
(appointments vs terminations) for Senior Management had however declined from
14% to only 5%. Employees with disabilities account for 1.36% of all staff and
20 out of 879 appointments made had disabilities (2.2%). This, although below
the national target of 2%, was a noticeable improvement on previous years. The
percentage of woman in senior management positions was relatively good at 45%
but did not compare well considering that 60% of the total workforce were women.
Of the reasons for
staff leaving the Department, the percentage of dismissals due to misconduct had
declined to 18% from 25% and was no longer the main cause of termination but
resignations had increased to 29% from 22%. Of the 161 reported disciplinary
hearings, 43% (70) of staff were dismissed and 22% (36) were suspended without
pay. A significant percentage of misconduct was classified as Fraud and
Corruption: 102 out of 164 cases (62%) with the next most common reason being
improper conduct with only 19 cases.
Training spending
per budget programme and per employee was not reported on as in previous years,
where there was an uneven expenditure between programmes and very low spending
per employee on training in the Citizen Affairs and Immigration Programmes (R18
and R178 respectively).
The Second State of
the Nation by the President in 2014 raised the following priorities relevant to
Home Affairs for the first year of the fifth Parliament:
Service Delivery Inter-Ministerial Task team – The Department of Planning, Performance
Monitoring and Evaluation in the Presidency had established this committee to
fast-track service delivery in areas where there were bottlenecks, quickly
respond to areas where there were service delivery problems, and ensure that
general service delivery was improved. The task team included representatives
from the Departments of Home Affairs, Human Settlements, Water and Sanitation,
Transport, Public Enterprises, Energy, Rural Development and Land Reform,
Health and Basic Education.
The primary role that
Home Affairs was likely to play in this regard was the timely provision of
secure identification documents/ cards which verify citizens’ entitlement to
access the services represented by the other Departments in the team.
Regional Integration – Regional integration was mentioned several
times in the address as important for economic growth. This was due to much of
South Africa’s trade occurring in Southern Africa but also given the need for
the region to compete in terms of size with other regions and countries in the
world. Home Affairs plays a key role in terms of ensuring easy access to
permits for foreigners and passports for citizens to allow them to travel for
business and investment in the region.
Home Affairs is also
a facilitator in improving the coordination of immigration laws in the region. A
key stride in this direction will be the process of extension of the Zimbabwean
Special Dispensation Permit (ZSP) from October 2014. This would be further
improved with the establishment of the Border Management Agency in Dispensation
2015/16, with related legislation due in 2014/15.
The Need to fight intolerance – Xenophobic attacks and attitudes remained an
issue in South Africa. The victims of this were often asylum seekers and
refugees from Africa who were in the country seeking safety from persecution in
their home countries. South Africa was party to international agreements to
protect these persons. With the need for investment, skills and business from
Southern Africa, Africa and the World; Home Affairs, as custodian of migration,
would need to play a key role in campaigns to discourage xenophobia and
encourage tolerance. This also related to the Government Priority of nation
building and social cohesion.
Youth Employment – Home Affairs is responsible for providing
documents that allow the youth to write their final exams, to enter
universities and gain access to formal employment. As with all government
departments, Home Affairs also needs to continue and expand its initiatives to create
decent work such as having internships and positions for young people entering
the job market.
Due
to the national and provincial elections conducted on 7 May 2014 and the
establishment of the 5th Parliament, the Committee focused on
processing the budget of the DHA. The Committee conducted one oversight visit
to Barrack Street Large Office in Cape Town on 26 August 2014.
Based on the findings of the oversight, the Committee
recommended the following:
The
DHA showed an 11% real decrease in its budget allocation (after inflation of
6.2%) in the 2014/15 financial year. The total budget of R6.62 billion for the
Department included allocations to its related entities; the Electoral
Commission (IEC); Government Printing Works (GPW) as well as the Film and
Publications Board (FPB). In total the budget was reduced by R371 million from
2013/14 to 2014/15.
National
Treasury data on the quarterly expenditure for the DHA for 2013/14 indicated
that total expenditure for the year was 2.7% less than the budget allocated.
This was similar to the 2.6% under spending in 2011/12. Although the DHA was
under spending a similar percentage as the previous financial year, there was
less fluctuation or change in the 2013/14 quarterly expenditure than in
2011/12. The DHA therefore maintained a fairly consistent and low under
spending in 2013/14 (of around 3% where 1% was usually considered acceptable by
National Treasury).
6.3.1. Programme 1: Administration
The
first budget programme of the DHA, Administration, showed a small nominal
increase in allocation which actually means a reduction of 5% or R98 million
when considering inflation. The aim of the programme is to provide leadership,
management and support services to the department.
The
most significant change to the programme was a reduction in the corporate
services sub-programme. This sub-programme largely manages one of the DHA’s
main objectives - a service that is efficient, accessible and corruption free.
The reduction in expenditure needs to be monitored given that Corporate
Services only managed to fully achieve 5 of its 12 targets (42%) for this
important outcome in the most recent 2013/14 Annual Report. The budget did not
specify where this real reduction in the Corporate Services budget was going to
occur and how service delivery was to be improved.
6.3.2. Programme 2: Citizen Affairs
The
most significant monetary reduction in budget allocation was to the largest
budget programme: Citizen Affairs. This programme aims to provide secure,
efficient and accessible services and documents for citizens and lawful
residents.
The
primary reason for the R521 million (12%) real decrease in the programme’s
allocation was because of a R330 million (79%) decrease in the Status Services
sub-programme. This sub-programme regulated all matters relating to the
national population register, including maintaining a register of all citizens
and permanent residents; registering births, deaths and marriages; providing
travel and citizenship documents and determining and granting citizenship. The
reductions were mainly due to expenditure related to the issuing of enabling
documents being funded from the self-financing funds (which the DHA generates
from charging for re-issuing of documents). This can be seen in the large
reduction in Goods and Services expenditure mainly reflected as a decrease in
consumables, i.e. stationery, printing and office supplies. This addressed the
issue of over expenditure in this sub-programme raised by the Portfolio
Committee on Home Affairs in its 2013 Budget Review and Recommendation Report
(BRRR).
In
contrast, the Access to Services sub-programme received the biggest percentage
increase of 38% in real terms (R26 million) across all sub-programmes. This was
encouraging since the sub-programme provided for the optimal placement and use
of the department’s services by opening new offices, deploying registration
facilities at health facilities, scheduling mobile office deployment in remote
rural areas, and managing customer telephonic enquiries.
Within
the Citizen Affairs programme, transfers to the three agencies falling within
Vote 4 comprised 42% of the programme’s budget. Most of this (39%) went to the
Electoral Commission (IEC) for national and provincial elections in 2014 and municipal
elections in 2016. The IEC received just less (0.08%) than an inflation related
increase, since most of its spending was in the year leading up to an election.
The
second entity, the Government Printing Works, was completely self-sufficient on
its own state printing revenue from 2013/14 and no longer needed transfers from
National Treasury. This would reduce the DHA Citizen Affairs budget by around
R100 million each year (-R130 million from 2013 to 2014). Whilst this was encouraging
in terms of efficiency it remained to be seen if the GPW would be able to cope
with the significant increase in targeted Smart ID cards anticipated this year
(1.6 million from only 100 thousand in 2012/13).
The last entity: the
Film and Publications Board was relocated to the Department of Communications.
6.3.3 Programme 3: Immigration Services
The
smallest programme in terms of allocation, Immigration Affairs, experienced the
largest percentage reduction of 14% (19% after inflation). The aim of this
programme is to facilitate and regulate the secure movement of people through
the ports of entry into and out of the Republic of South Africa, determine the
status of asylum seekers, and regulate refugee affairs. The programme has four
sub-programmes.
The
most significant reduction was in the Admission Services sub-programme which
shows a 41% real reduction in allocation decreasing from R396 million to R247
million in 2014. This sub-programme is responsible for issuing visas, securely
facilitating the entry and departure of persons to and from South Africa in
line with the Immigration Act (2002) including work, study and business
permits. However the reductions affecting both the Immigration and Admission
Services sub-programmes were in non-core areas of operations such as venues and
facilities, catering, and entertainment and it was stated they will not
negatively impact on the delivery of services.
For several years the Immigration Affairs programme
had been the worst performing programme and/or section of the DHA in terms of
the number of strategic targets achieved. Monitoring of performance for this
programme was needed particularly given the two NDP priorities of: a)
Facilitating the migration of scarce skills into South Africa to enable rapid
growth, as well as b) Promoting regional growth and development. The 2013 BRRR
of the Portfolio Committee on Home Affairs also mentioned that a special intervention was required by the
DHA to ensure that the permanent and temporary residence permits and the
related backlogs were addressed. This continues to impact negatively on the
Minister of Home Affairs’ performance target of 50 000 skilled immigrants per
annum.
6.4 Human resources
The
DHA had been automating the business processes for issuing enabling documents
and allowing biometric data, photographs, fingerprints and signatures to be
captured live electronically. This systems modernisation programme had allowed
the DHA to maintain its funded establishment at 10 369 posts over the medium
term (three years), made up mainly of frontline and back office staff in
service delivery offices as well as head office staff. The overall vacancy rate
in the Department had declined from 10.3% and higher in previous years to 6.6%
by April 2014 (In total there were 680 vacancies out of the 10 344 total
approved posts). The DHA did not indicate, however, how many posts they required
that remain unfunded by National Treasury.
Posts
were vacant due to natural attrition and existing vacant posts that were not
filled but the DHA anticipated would be filled over the medium term. The DHA
did not employ contract workers and used consultants on an ad hoc basis,
particularly with regard to ICT, where the DHA experienced difficulty in
attracting suitably qualified and experienced candidates.
As
would be expected, the main service delivery programmes spend significantly on
compensation of employees. This comprised 48% of the Citizen Affairs programme
(of 8333 personnel) and 39% of the Immigration Affairs programme (of 1024
personnel). This was compared to only 22% for the Administration Programme.
The
high vacancy rates in audit services, counter corruption and immigration
services had been seen to seriously negatively impact on service delivery. In
particular, the delays in filling of key management positions such as the Chief
Financial Officer, Provincial Managers in Kwazulu-Natal and North West, as well
as the Chief Internal Audit Executive needed to be finalised as soon as
possible.
6.5 The Standing Committee on Public Accounts (SCOPA)
On the 14th of May 2013 SCOPA met with the Department to
interrogate and hear evidence on the contents of the Annual Report and the
report of the AG on the 2011/12 of the DHA. During 2013/14 the Department
incurred no new unauthorised
expenditure. It however had outstanding balances of over R 1 billion; R99.9 million
of which relates back to 2005/6 (Comprised of unauthorised expenditure and
expenditure for information technology capital projects without prior approval
from National Treasury).
The Director General indicated
that SCOPA had approved of this R99.9 million, R53 million of this amount,
however, must be funded from savings the DHA
makes on its future budget. The reason that the amount was still recorded in
the annual report was that the required finance bill proclamation was delayed.
This however was the same reason given as in the previous Annual Report. The
outstanding amounts emanating from 2010/11 and 2012/13 were reported as being
raised with treasury to be funded through a finance bill. A meeting of SCOPA on
this matter is scheduled for November 2014.x
Unauthorised,
Fruitless and Irregular Expenditure
R’000 |
2009/10 |
2010/11 |
2011/12 |
2012/13 |
2013/14 |
Opening balance |
101
806 |
99
883 |
787
187 |
787
187 |
1 088
221 |
Current year (minus) |
(1
923) |
687
304 |
|
301
034 |
|
Total |
99 883 |
787 187 |
787 187 |
R1 088 221 |
R1 088 221 |
The
following findings emerged from the various sources included in the report and
from the discussions of the Portfolio Committee on Home Affairs with the DHA, IEC
and GPW.
7.1 Issues outstanding
from the 2013 Budget Review and Recommendation Report.
1.
The vacant funded posts in
the DHA were not filled within six months as directed in the 2013 State of the
Nation Address (SONA).
2.
The DHA did not achieve the
2% of the employment of persons with disability.
3.
There had been insufficient
improvements in the amount of time taken for processing Permanent and Temporary
Residence Permits. The processing of applications within eight months had still
not been achieved for 50% of PR applications and would create further backlogs
going forward.
4.
The implementation and
integration of IT systems of the DHA were still not sufficiently addressed.
5.
The DHA had not yet
addressed all the areas of concern raised by the Auditor-General (AG) in the
Annual Report for 2012/13.
6.
Insufficient measures were
taken to address court rulings on the closure of Refugee Reception Offices.
7.
The IEC still had issues
with political party’s attendance of the political Party Liaison Committees
(PLCs).
8.
The collection of revenue in missions abroad was
still a major challenge. DIRCO was not providing all supporting documents to
the DHA.
9.
The Department of Public Works (DPW) was not
providing adequate support to the DHA in acquiring and renovating offices,
particularly at border posts. This also applied to the GPW, who had been
delayed for some time in moving to the new Visagie Street facility.
10.
There were challenges in measuring performance
against targets set by the DHA.
11.
The post of the Chief Executive of Internal Audit
had still not been filled in a permanent capacity.
7.2 Annual Report
1.
The DHA has regressed on the
audit outcomes and received a disclaimer.
2.
There were improvements on the
issuing of passports and smart ID cards to citizens.
3.
The DHA spent approximately R5.5
million on Adult Basic Education, which is a responsibility of the Department
of Basic Education.
4.
There were insufficient levels of
assurances in the DHA to ensure that employees were meeting their performance
targets.
5.
Persons who had overstayed their
permits through no fault of their own had been declared undesirable persons,
banned from entering South Africa in terms of the recently implemented
amendments to the Immigration Act.
6.
There was an increased allocation
for contingent liabilities related to unresolved long outstanding legal cases
against the Department.
7.
Not all of the staff in the DHA
were security vetted.
8. SCOPA had approved R99.9
million in outstanding unauthorised expenditure.
9.
Management did not
accurately record all leave taken by employees during 2013/14.
10.
The records kept
to verify the asset register of the DHA were inadequate for audit purposes.
7.3 Budget, Quarterly Reports and Annual
Performance Plan
1.
Immigration initiatives such as the proposed
Border Management Agency feasibility study are a positive step towards
improving border security.
2.
The budget limitations across all Departments would
have a negative impact on the already low performance against targets in the
DHA, particularly in Immigration Services.
3.
Several Refugee Reception Offices remained closed.
7.4 Agencies
in the Home Affairs Budget: Government Printing Works and Electoral Commission
1.
The Government Printing Works intend to become a State Owned Company over
the medium term expenditure period.
2.
There are ongoing delays in the special salary dispensation for GPW that is
to be approved by the DPSA.
3.
There are audit issues related to source
documents to support performance against two predetermined objectives
preventing the IEC from retaining a clean audit.
Based
on the oversight and engagement with the Department of Home Affairs (DHA), the
Electoral Commission (IEC) and the Government Printing Works (GPW); the
Portfolio Committee on Home Affairs recommends that the Minister should:
1. Consider prioritising budget allocation and related performance
improvements in the Immigration Programme. The continued low performance on
Refugee and Immigration-related indicators is compounded by the prioritisation
and virement of funds to the Citizen Affairs and Administration programmes.
2.
In terms of regional integration, prioritise the infrastructure and staffing
issues as well as the rolling out of one-stop-border posts to other busy ports
of entry.
3.
Provide a
progress report on the budget related to closed refugee reception centres and plans
for relocation of centres to the borders to Parliament within 90 days of the
adoption of this report by the National Assembly.
4. Prioritise the urgent finalisation of the special salary
dispensation for the GPW with the DPSA.
5.
Ensure that the DHA addresses the issues raised by the Auditor General
for 2013/14, in particular the relations with DIRCO and strive towards a clean
administration.
6.
Prioritise the implementation of the IT modernisation programme.
7.
Encourage programmes and initiatives addressing ongoing xenophobic
violence.
8.
Urge the Electoral Commission to address the findings of the AG in order to
return to a clean audit.
Report
to be considered