1 Department of Public Works SECTION 100(1)(B) INTERVENTION – PRESENTATION TO THE SELECT COMMITTEE ON FINANCE WEDNESDAY, 30 JULY 2014 CAPE TOWN

PRESENTATION OUTLINE Responses to the previous NCOP Recommendations Progress to date & Way forward 2

RESPONSES TO PREVIOUS NCOP RECOMMENDATIONS NCOP recommended that a gradual process of handover commence  The responsibilities of for all intervention projects resides with individual managers as indicated in the attached report 3

PROGRESS AND WAY FORWARD DIAGNOSTIC SOURCE AND OUTCOME OUTPUT PROGRESS MADE MEASURERESPONSIBLECONTROL 1. Diagnosis: The LDPW lacks the necessary technical skills in the core business. Outcome: Technical positions are occupied by properly qualified staff. A skills gap assessment report that identifies the mismatch between existing skills and skills required by the position occupied. DBSA appointed and MOU signed Adhere to agreed deadlines and budget (cost and time) as per project plan of DBSA GM: Construction Management Reports from DBSA to corroborate progress made. 2. Diagnosis: Limpopo Province is paying close to R200m in leases to private lessors. Outcome: Province moves into owned buildings to reduce the lease cost. A report on the progress of implementatio n of recommendati ons of the report. Final lease review report complete with recommendati ons. Land has been identified to build a government precinct Lease cost is reduced substantially Progress reports on relevant stakeholders (municipality, Treasury approached for funding, designs) Acting GM: Property management Reports from stakeholders 4

PROGRESS AND WAY FORWARD DIAGNOSTIC SOURCE AND OUTCOME OUTPUT PROGRESS MADE MEASURERESPONSIBLECONTROL 3. Diagnosis: LDPW does not have an immovable asset register as defined. The AG continues to disclaim the LDPW on the IAR Outcome: There is an IAR in place that informs the infrastructure planning process of the Province. An immovable asset register that complies with the principles of GIAMA. No AG findings on IAR Service provider appointed. Reduction in AG findings from 8 to 2 in 12/13. Adhere to agreed deadlines and budget (cost and time) as per project plan of service provider. Acting GM: Property management Reports from service Provider 5

PROGRESS AND WAY FORWARD DIAGNOSTIC SOURCE AND OUTCOME OUTPUT PROGRESS MADE MEASURERESPONSIBLECONTROL 4. Diagnosis: The LDPW is unable to recruit the necessary technical skill. The process of appointing professional staff is long and cumbersome. Outcome: Vacant positions are filled with appropriately qualified staff. All other departments in infrastructure delivery have access to the necessary technical capacity for project identification, feasibility studies and planning A report on the progress of the implementation of the infrastructure HUB. Concept of Infrastructure Strategic Planning HUB has been accepted. On the 29 July 2014 there is an official launch. % of appointed professionals against the targeted 222 in various fields as reported by the Provincial Treasury. GM: Construction Management Reports from the Provincial Treasury. Monitor capex expenditure trends 6

PROGRESS AND WAY FORWARD DIAGNOSTIC SOURCE AND OUTCOME OUTPUTPROGRESS MADEMEASURERESPONSIBLECONTROL 5. Diagnostics: The LDPW does not have the necessary capacity to deliver on infrastructure. As a result, there is a prevalence of Project Management Units (PMU) at a huge cost to the fiscus. Outcome: Public Public partnerships and PPP’s exist to supplement existing capacity Progress reports on the implementatio n and management of the MOU’s Partnerships concluded with DBSA (Implementing agent and PMU) WBHO (professionalizat ion of existing professional staff) and Stefannutti (Mentoring programme and Contractor Development for CIDB levels 5 and above) Adhere to agreed time frames as agreed with partners in their respective implementation plans. GM: Construction Management Reports obtained from partners on the implementa tion of the terms of the MOU’s. 7

PROGRESS AND WAY FORWARD DIAGNOSTIC SOURCE AND OUTCOME OUTPUTPROGRESS MADEMEASURERESPONSIBLECONTROL 6. Diagnostics: The LDPW does not have a project management system from project conceptualisation to project delivery. The result is that project documentation is untraceable resulting in AG findings. Outcome: There is a project management system that allows for monitoring and archiving of projects using technology. A report on the implementati on of PROMAN Service provider procured Project plan in place Adherence to the agreed time and cost plans submitted by the service provider GM: Construction Management Reports from service pro provider on progress against plans 8

PROGRESS AND WAY FORWARD DIAGNOSTIC SOURCE AND OUTCOME OUTPUTPROGRESS MADEMEASURE RESPONSI BLE CONTROL 7. Diagnostic: The organizational structure does not address the infrastructure role of the LDPW. Outcome: The LDPW is delivering optimally its mandate and is guided by an organizational structure that is infrastructure focused in line with the LDPW’s role as defined in the Infrastructure Delivery Management System (IDMS) An approved organization al structure that accommodat es the Public Works and Roads functions. Existing plan overtaken by amalgamation of Roads and Public Works. Process undertaken by a task team led from the Premier to finalise the organizational structure. Obtain the project implementatio n plan from the Premier’s office. Act HOD: Monitor implementa tion of the plan 9

PROGRESS AND WAY FORWARD DIAGNOSTIC SOURCE AND OUTCOME OUTPUTPROGRESS MADEMEASURE RESPONSI BLE CONTROL 8. Diagnostics: The office of the CFO does not have the requisite capacity to manage the budget process, SCM and general financial management. The result is that the AG continues to issue disclaimer opinions -Outcome: A department that operates at level 5 of the Financial Maturity Capability Model as designed by the National Treasury A skills gap assessment report that identifies the mismatch between existing skills and skills required by the position occupied as well as clear actions to address gaps. A clean audit report Appointed 3 Senior Managers in SCM, Financial Accounting and Budgeting. Obtain a plan on the implementation of the skills assessment project in the CFO’s office CFOMonitor implementa tion of the plan in accordance with time and cost 10

PROGRESS AND WAY FORWARD DIAGNOSTIC SOURCE AND OUTCOME OUTPUTPROGRESS MADEMEASURE RESPONSIB LE CONTROL 9. Diagnostic: There are no consequences for officials who continuously breach PFMA and other laws of the country. Outcome: The LDPW has performance management system in place that is managed, applied consistently to improve performance at all levels of management. Resolve all matters of DC speedily. State Attorney’s office appointed to deal with cases of 2 GMs and 1 SM implicated in a forensic report (there may be more officials charged as the final forensic report was received a week ago), 2 Senior Managers, cases of SCOPA dating back to 2010/2011 (arising out of the audit report as well as RWOPS), as well as long outstanding grievances in order for Labour Relations to start on a clean state. Case of HOD referred to Premier’s office in April Obtain details of all cases with dates, presiding officers Act HODMonitor the resolution of the cases from the dates the matter entered into report. 11

PROGRESS AND WAY FORWARD DIAGNOSTIC SOURCE AND OUTCOME OUTPUTPROGRESS MADEMEASURERESPONSIBLECONTROL 10. Diagnostics: The office of the CFO does not have the capacity to manage the financial management process. The system does not exist for asset management and SCM. The work is done on excel and this increases the risk of human error. Outcome: There are systems that support financial management of the Department in place LOGIS is implemente d even as an interim system. BAUD system for movable asset management implemented. Obtain plan for implementa tion of LOGIS CFOMonitor implementa tion against the plan 12

THE END THANK YOU! 13