DOC has 'management deficiency'

Deficient management and monitoring at the Department of Communications (DOC) have been pinpointed as areas of weakness by the auditor-general (AG).

At the presentation of the department's 2011/12 annual report last week, Parliamentary portfolio committee members said the minister being fairly new is not an excuse for the weak leadership.

ANC committee member Regina Lesoma expressed disappointment over the poor performance of the DOC's executive management.

She said issues highlighted by the AG were not related to the recent appointment of Dina Pule as minister. "The current executive management of the DOC has been in position for a number of years. The development of adequate capacity was constrained by the extensive use of external contractors."

The committee was briefed by the AG on 9 October on the DOC's audit outcomes for 2011/12.

The AG's findings concerning human resources management and compensation listed contraventions of the Public Service Regulations, including the failure to fill funded vacant posts, overtime compensation to employees in excess of 30% of their monthly salaries, making appointments to unfunded and unapproved posts, and the failure of senior managers to sign performance agreements.

With regards to financial and performance management, the AG found that action was not taken to reduce the risk of non-compliance with supply-chain management regulations. Also, there were previous findings concerning irregular expenditure and corrective action had not been effective.

Members said there were disturbing trends in human resource management and insisted employees must be held accountable for their performance and should not be rewarded with bonuses for simply doing their jobs.

About 53% of senior management staff had received bonuses when there was no evidence of exceptional performance by the department, according to members.

"The population continues to suffer poor and interrupted communication services and has not experienced any benefits from improved service delivery by the department."

Members questioned whether action had been taken by the DOC's executive management to address the audit findings for previous years.

The AG had reported serious management deficiencies where only 70% of the targets set had been achieved. However, members also questioned if the objectives were measurable, if the targets were clearly formulated, and what the benefits were for the country if the targets were met.

The committee noted that a number of international conferences and workshops were attended but it was not clear what the outcomes were and what the benefits were for SA.

Deputy director-general of administration, Sam Vilakazi, reported on the financial performance of the DOC for the 2011/12 fiscal year.

Total revenue amounted to R4.33 billion. Total expenditure was R1.79 billion. The total amount transferred to National Treasury was R2.54 billion, including an amount of R211 million which was under-spent on broadband, digital terrestrial television and other projects. The final appropriation for 2011/12 was R2 billion.

ANC committee member Wilma Newhoudt-Druchen observed that the department had under-spent its allocation and had also transferred a substantial amount to National Treasury; however, the reason for the failure to achieve certain targets was given as funding constraints.

Irregular expenditure of R116.7 million is set to be condoned. Members expressed concern that no further action is taken once the irregular expenditure item has been condoned.

They also questioned why charges were not laid against officials responsible for legal transgressions. The failure to take action jeopardises foreign funding for projects and sponsorships.

There was fruitless and wasteful expenditure of R34 000 for duplicate air tickets, R128 000 for the cost of no-shows, R429 000 for damaged rented vehicles, and R467 000 for security for the 112 emergency call centre.

The AG cited a lack of leadership, setting the wrong tone and the unwillingness to prosecute officials as the reasons for irregular, fruitless and wasteful expenditure.

Members insisted action be taken against officials who have resigned rather than facing disciplinary action since there has to be serious consequences for financial management transgressions even if the officials leave the department.

Democratic Alliance shadow deputy communications minister Butch Steyn said the DOC is not delivering on its mandate.

He added that the department under-spent on ICT infrastructure development, which is a key delivery item and more important than participation in various international conventions.

Steyn also said the performance report on ICT enterprise development listed a target to establish two ICT hubs but no funding was made available. "There should be a link between the budget and the objectives that have been set."

The committee noticed a big difference between the reports of the DOC and AGSA, with the report by the DOC creating the impression that everything is in order. However, members said this is clearly not a true reflection of the situation.

Members pointed out that the target concerning ICT systems was reported by the DOC as "fully achieved" but this was one of the major areas of concern raised by AG.

The department's broadband project has been put on hold since it realised there are gaps in the plan.

A review is now taking place. Treasury agreed the national broadband policy has to be finalised before the project resumes.

The 112 emergency call centre project is a public/private partnership over a period of 18 months. The consultancy fee of R5 million was paid to Deloitte, which was appointed to coordinate the entire process, according to the DOC.