The Budgetary Review and
Recommendation Report of the Portfolio Committee on Arts and Culture on the performance of the Department of Arts and
Culture for the 2011/12 financial year,
dated 24 October 2012
The Portfolio Committee on Arts and Culture, having assessed the performance of the Department of Arts and Culture for the 2011/12 financial year, reports as follows:
1.1 The role and mandate of the Committee
The role and mandate of the Committee is to:
· Consider the Budget Vote of the Department of Arts and Culture;
· Consider legislation referred to it;
· Exercise oversight over the Department of Arts and Culture and its statutory bodies; and
· Consider all matters referred to it in terms of legislation, the Rules of Parliament or resolutions of the House.
In terms of the
Constitution of the
Section 5 of the Money Bills Amendment Procedures and Related Matters Act No 9 of 2009 provides that:
· The National Assembly, through its Committees must annually assess the performance of each National Department
· Committees must annually submit Budgetary Review and Recommendation Reports for tabling in the National Assembly.
A Committee reporting to the National Assembly in terms of this section must submit its budgetary review and recommendation report after the adoption of the Appropriation Bill and prior to the adoption of the reports on the Medium Term Budget Policy Statements (MTBPS).
For the period under review, the Portfolio Committee on Arts and Culture, in exercising its oversight role, had interacted with the Department of Arts and Culture (DAC) and analyzed its 2010 to 2014 Strategic Plan, the 2011/2012 Annual Report of the Department, the Auditor- General’s Report, the State of the Nation Address and the 2010/2011 estimates of the National Expenditure.
1.2 The role and mandate of the Department of Arts and Culture
of Arts and Culture is tasked to create an environment conducive for the
growth, development and flowering of
The Vision of the Department of Arts and Culture is to develop and preserve South African culture to ensure social cohesion and nation building.
The mission of the Department of Arts and Culture is to:
Develop and promote arts and culture in
Develop and promote the official languages
· Improve economic and other development opportunities for South African arts and culture nationally and globally through mutually beneficial partnerships, thereby ensuring the sustainability of the sector;
· Develop and monitor the implementation of policy, legislation and strategic direction for the identification, conservation and promotion of cultural heritage; and
· Guide, sustain and develop the archival, heraldic and information resources of the nation to empower citizens through full and open access to these resources.
1.2.3 Constitutional and legislative mandate
legislative mandate of the Department comes from Section 16(1) and Section 30
of the Constitution of the
Section 16 (1) states that “Everyone has the right to freedom of expression, which includes:
a) Freedom of press and other media;
b) Freedom to receive or impact information or ideas;
c) Freedom of artistic creativity; and
d) Academic freedom and freedom of scientific research”.
Section 30 states that “Everyone has the right to use language and to participate in the cultural life of their choice, but no one exercising these rights may do so in a manner inconsistent with any of the provisions of the Bill of Rights”.
mandate of the Department is derived from the Constitution of the Republic of
Section 16(1): “Everyone has the right to freedom of expression, which includes -
a) Freedom of the press and other media;
b) Freedom to receive or impart information or ideas;
c) Freedom of artistic creativity; and
d) Academic freedom and freedom of scientific research.”
Section 30: “Everyone has the right to use the language and to participate in the cultural life of their choice, but no one exercising these rights may do so in a manner inconsistent with any provision of the Bill of Rights.”
Section 32(1): “Everyone has the right of access to:
a) any information held by the state; and any information that is held by another person and that is required for the exercise or protection of any rights; and
b) any information that is held by another person and that is required for the exercise or protection of any rights.”
The primary legislative framework of the Department emanates from the following Acts:
National Film and Video Foundation Act, 1997 (Act No. 73 of 1997)
National Heritage Council Act, 1999 (Act No. 11 of 1999)
National Heritage Resources Act, 1999 (Act No. 25 of 1999)
National Library of
Pan South African Language Board Act, 1995 (Act No. 59 of 1995)
South African Geographical Names Council Act, 1998 (Act No. 118 of 1998)
South African Library for the Blind Act, 1998 (Act No. 9 1 of 1998)
Cultural Institutions Act, 1998 (Act No. 119 of 1998)
Culture Promotion Act, 1 9 8 3 (Act No. 35 of 1 9 8 3 )
Heraldry Act, 1962 (Act No. 1 8 of 1962)
Legal Deposit Act, 1997 (Act No. 54 of 1997)
National Archives and Record Service of
National Arts Council Act, 1997 (Act No. 56 of 1997)
Promotion of Access to Information Act, 2000 (No. 2 of 2000)
National Council for Library and Information Act, 2001 (Act No. 6 of 2001)
2. STRATEGIC PRIORITIES AND MEASURABLE OBJECTIVES OF THE DEPARTMENT OF ARTS AND CULTURE (DAC)
Through arts, culture and heritage, the Department’s strategic plan seeks to serve South Africa’s wider artistic and cultural needs and contribute to economic growth, job creation, skills development, rural development, national reconciliation, nation building and social cohesion.
The following strategic focus areas are critical to the success of the Department:
2.1 Strategic Priorities of the Department of Arts and Culture
The Department focused on the following strategic themes:
· Development, preservation and promotion of arts, culture and heritage.
· Economic development.
· Skills development.
· Preservation for access to information.
· Social cohesion and nation building.
2.2 Measurable objectives of the Department of Arts and Culture
Analysis of performance per programme is limited to key successes and challenges. Successes are considered to be areas in which the Department has exceeded its targets, while challenges indicate failure to meet targets. Challenges highlighted are particular to prioritised targets set out in the Strategic Plan.
2.2.1 Programme 1: Administration
· The Department successfully revised and submitted its Annual Performance Plan (APP). The APP was tabled in Parliament in March 2012.
· The Fraud Prevention Implementation Plan was developed and approved for implementation by the end of the financial year.
· DAC awarded bursaries to 100 per cent of eligible bursary applicants in its efforts to build capacity through talent management and Human Resource Development.
· The Internal Audit Plan was fully implemented during the period under review.
· The Department had set a target of 98 per cent expenditure of the approved budget. The actual figure was 95 per cent. The variance was attributed to under-expenditure due to:
o Investing in Culture (IIC) projects not paid out,
o Capital projects not finalised,
o Social cohesion projects not executed, and
o MGE projects delayed.
· The Department failed to successfully develop and implement Monitoring and Evaluation Tools and Systems to facilitate the use of consistent approaches and standards in assessing the performance of DAC and its public entities. Research and consultations were reported as the reasons for delays in finalisation. The draft stages of the following were reached:
o Integrated Planning Framework,
o Monitoring and Evaluation strategy/framework, and
o Reporting guidelines and planning framework.
· The Department has established a Performance Management and Development System (PMDS). Of the targeted 100 per cent of half-yearly performance reports to be received by Human Resources Management, only 60 per cent of reports were submitted. The Department cites poor compliance with the PMDS policy by employees and managers as the cause for variance.
2.2.2 Programme 2: Performing Arts
2.2.3 Programme 3: National Language Service
· The amount not spent on this Programme stood at 0.69 per cent (R 684 000 out of a total budget of R99 418 000) of the final appropriation and all planned targets were achieved.
· Bursaries were offered to 312 students in order to enhance skills development in the language profession. The amount of bursaries offered exceeded the planned target of 180. In light of the South Africa Languages Bill [B23 of 2011] that was passed by Parliament recently, the DAC is working towards addressing the need for trained professionals in the language sector.
· A consultative conference was convened to develop the strategy and action plan for development of literary works in indigenous official languages, and a strategy was adopted by the conference.
· A Terminology Management System (machine-aided translation tools) was delivered, installed and implemented.
· A Memorandum of Understanding (MoU) with the Dutch Language Union was signed and implemented.
This Programme presented no challenges.
2.2.4 Programme 4: Cultural Development
The Annual Moshito (rhythm in sePedi) Music
Conference, Exhibition and Showcase was held in
· An action plan for the Independent Record Companies of South Africa (AIRCO) was developed and approved. This action plan is designed to empower local music producers.
· A business plan for the Downtown Studio Hub was completed and approved by its Board.
· Small and independent local companies were subsidised to publish books in nine indigenous languages. These books were unveiled during the 2011 National Book Week.
· The Department participated in the following continental arts and culture festivals:
International Cinema Festival of the
International Art and Craft Fair,
o Festival of Pan African Music (FESPAM), and
· It is promising to note that five countries were identified and engaged on the African World Heritage Fund (AWHF), namely Guinea-Bissau, Senegal, Angola, Oman and Qatar. Partnerships with these countries will assist in the leverage of resources for the AWHF.
· The Audit Committee recommends an increase in efforts to ensure that performance objectives are met. As with Programme 2, lack of staffing has a direct effect on programmes not fully achieving their objectives.
· As at the end of the financial year, 13.8 per cent of the appropriated budget was unspent. An amount of R19.4 million was not utilised. This is attributed to the following:
o Second payments to the Investing in Culture (IIC) projects could not be verified and paid, and
o MGE projects were not implemented on time.
· The draft conceptual document on national music policy for the MGE strategy was not developed. The reasons for variance were prolonged discussions with stakeholders and lack of funds.
The study on the
2.2.5 Programme 5: Heritage Promotion
· As part of rolling out the Heritage Human Resources Development Strategy (HHRDS), 106 bursaries were awarded and professional development courses were supported.
· The strategic plans of 16 heritage institutions were evaluated.
· An assessment of security and access needs of heritage institutions was conducted and budget allocations were made.
facilitated the United Nations Educational, Scientific and Cultural
Organization’s (UNESCO) reactive mission visits to
Construction of the
· An audit report on Intangible Cultural Heritage (ICH) was developed and approved. A database of South African ICH as well as a management strategy was developed.
· As at the end of the financial year, 8.26 per cent of the appropriated budget was unspent. An amount of R62.1 million was not utilised. This is attributed to the following:
o R49.9 million earmarked for the Muyexe and Ngquza heritage projects managed by the Independent Development Trust (IDT). Funds were transferred but not spent by the IDT as they were treated as prepayments and not actual expenditure.
o R5.5 million was unspent due to various uncompleted projects.
o R6 million was unspent due to delays in social cohesion projects.
· The Sarah Baartman Centre of Remembrance was not completed. The budget was approved and construction will commence in the 2012/13 financial year and is projected to be completed in 2015.
· Some headway has been made with the Women’s Museum and Development Centre. The property that the DAC was to have purchased is no longer available. The DAC held a meeting with relevant stakeholders. A need to conduct socio-historic research was identified, thus influencing the timeframes.
· The Solomon Mahlangu Project was not approved by Cabinet.
2.2.6 Programme 6: National Archives and Library Services
The launch of the Friends of the Archives Programme
took place on 9 September 2011. As part of this outreach programme, three
· The planned target for records received, captured and processed was 90 per cent. This target was not only met, but actual performance was 160 per cent. This means that a backlog carried over from previous years was captured.
· The North West Provincial Archives co-hosted the Annual Oral History Conference in conjunction with the North West Department of Sports, Arts and Culture.
· The actual number of mini-libraries established to promote access to information for the visually impaired far exceeded the planned total of six. In total, 24 mini-libraries were established due to the unexpected interest in the project.
· As at the end of the financial year, 2.09 per cent of the appropriated budget was unspent. An amount of R15.4 million was not utilised. This under-spending was attributed to delays in implementation of social cohesion projects, which will be executed in the 2012/13 financial year.
· The planned evaluation of the condition of all archival records was not undertaken. However, a pilot survey to determine the condition, extent and needs of collections was conducted. Limited personnel and time are cited as reasons for not achieving this target.
· The National Archives Digitisation Strategy only reached draft stage. It was not approved as planned due to the pending approval of the National Policy on Digitisation of Heritage, on which the Strategy is dependent.
3. ANALYSIS OF STRATEGIC PLANS OF THE DEPARTMENT
The activities of the Department are organized under the following programmes:
Programme 1: Administration (Corporate Services)
The main purpose of this programme is to provide leadership, management and support functions of the Department.
Programme 2: Performing Arts
The main purpose of this programme is to promote the performing arts. This is achieved through:
· Promotion of performing arts to develop the literary, visual and performing arts through financial assistance to various performing arts institutions as well as groups and individuals;
· The National Arts Council supports the various disciplines of arts and culture through financial support, guided by funding criteria that promote government objectives;
· Arts Institutions transfer funds to various playhouses to promote the performing arts. The bulk of this sub programme’s budget is used for operating playhouses.
The National Film and Video Foundation
supports skills, local content and local marketing development in
· Capital works of playhouses fund and administer capital grants to playhouses for maintenance and other capital projects. One hundred percent of the budget is transferred to qualifying entities.
Programme 3: National Language Services
The purpose of this programme is to promote the official languages of
· Promote the national language policy and develop strategies for implementing it. The bulk of the subprogramme’s budget is used for implementing language development programmes, such as the development of human language technologies and the translation of government documents in all 11 official languages.
· Pan South African Language Board creates an environment conducive to developing, using and promoting the 11 official languages, as well as the Khoe, Nma, San and South African sign language.
Programme 4: Cultural Development
The purpose of this programme is to promote and develop South African arts and culture. This is achieved through the following:
· Cultural development supports the creative industries by developing strategies, participating in various stakeholder forums, supporting projects in the various disciplines, and by providing training.
· Investing in culture promotes job creation, skills development and economic empowerment, and supports business start-ups and poverty alleviation projects. The bulk of its budget is used for transfers to projects, which are initially disbursed on the basis of business plans and agreements between the department and the individual or group contractors.
International cooperation ensures
Programme 5: Heritage Promotion
The purpose of the programme is to promote policy, legislation and strategic direction for identifying, conserving and promoting cultural heritage. This is achieved by the following:
· Promotion of heritage funds a range of heritage initiatives and projects, such as Heritage Month and the repatriation of South African cultural and heritage objects. It also funds the Bureau of Heraldry, which registers symbols, popularises national symbols through public awareness campaigns, and coordinates the national orders award ceremony.
· Heritage institutions funds and determines policy for declared cultural institutions and heritage bodies by ensuring that funds to the institutions are used to preserve, protect and promote heritage.
· The South African Heritage Resources Agency develops norms and standards to manage and protect heritage resources, including auditing heritage resources and developing management plans.
· The South African Geographical Names Council is an advisory body that facilitates name changes by consulting with communities to advise the Minister.
· Capital works of heritage institutions focuses mainly on providing and administering capital grants for constructing and maintaining heritage infrastructure. The bulk of its budget is spent on awarding funds to entities, based on their business plans. These include the national legacy projects, which develop commemorative structures and programmes, such as the Matola monument and interpretive centre complex.
Programme 6: National Archives and Library Services
The purpose of
the programme is to facilitate full and open access to the archival and
information resources of
· National archive services acquires, preserves, manages and makes accessible public and non public records with enduring value.
· National library services funds libraries and institutions and develops related policy.
· Community library services transfers funds to provincial departments for the community library services conditional grant for constructing libraries, hiring personnel and purchasing library materials.
· Capital works of libraries provides and administers capital grants to associated institutions for maintenance and other capital projects.
4. THE ANALYSIS OF DEPARTMENTAL ALLOCATIONS AND EXPENDITURE REPORTS 2011/12 (SECTION 32 OF THE PUBLIC FINANCE MANAGEMENT ACT)
EXPENDITURE 2011/12 PER PROGRAMME
Actual Amount Spent
National Language Service
National Archives and Library Services
2, 468, 577
2, 536, 933
2, 405, 832
In 2011/12 expenditure of 96.8 per cent (i.e. R2.46 billion against an available budget of R2.53 billion) was incurred, resulting in under-expenditure of R81 million. The under-expenditure was mainly due to:
· Late receipt of invoices from service providers for computers and other IT related equipment.
· Withholding of funds due to unsatisfactory spending by provinces on the Community Library Services Conditional Grant.
· Slow spending on the investing in culture projects.
· Slow spending on the allocation for Capital Works and infrastructure projects by public entities. This slow spending was mainly due to delays in the appraisal of project plans by the Department which delayed the allocation of funds to entities.
With regards to 2011/12, under-spending in the third quarter was once again attributed to, non-filling of funded vacancies, especially management positions; delays in the implementation of projects such as the Mzansi Golden Economy (MGE) project; capital works transfers; and delays in a number of orders for machinery and equipment for the National Archives. Expenditure trends did not change much from the first three quarters.
The Department has a tendency of committing fiscal dumping towards the end of each financial year in order to be seen to be spending its budget. The danger here is that the Department may end up spending its budget on things that are not budgeted for. It is important to indicate that this pattern of spending creates a picture of unbalanced budget expenditure outcomes. The consistently poor expenditure patterns require close monitoring and oversight.
5. ANALYSIS OF THE ANNUAL REPORTS AND AUDITED FINANCIAL STATEMENTS OF THE DEPARTMENT OF ARTS AND CULTURE
5.1 Statement of Financial Performance
The Department has achieved the following:
· Reduced its vacancy rate from 27.6 per cent in the 2010/11 financial year to 9.5 per cent in 2011/12.
The Minister of Arts and Culture announced the declaration
Reported significant progress on the development of
Facilitated the opening of the ‘
Sponsored production of “Azikwelwa” (We will not
ride), a music production based on the 1950s Alexandra Bus Boycott that
commemorates the history of the struggle in
· Launched the JL Dube Legacy Project at the Ohlange Institute in Inanda. Linking to the 2012 SONA, this project (which the DAC will support financially) was marked by the laying of wreaths at the refurbished and restored graves of Dr. JL Dube and his wife and children.
Hosted an Indian Festival in 2011 as part of
implementing the bilateral cultural agreement with
Hosted a Consultative Conference on the MGE
Strategy in April 2011. This event brought together over 1000 delegates from
· Participated in a range of international festivals and events, including but not limited to the COP17 International Conference, the Cape Town International Jazz Festival, the Cape Town Carnival, and the South-Africa French Seasons.
· The Heritage Promotion Bursaries Programme was launched in 2011. During the year under review, the Department awarded bursaries to 312 post-graduate students for studies in language practice, including language policy development and terminology studies. Undergraduate students were also awarded bursaries in the field of language practice.
· While the Department has reduced its funded vacancy rate to 9.5 per cent from 27.6 per cent at the end of the 2010/11 financial year, the vacancy rate in senior management (levels 13 – 16) stands at 22 per cent. According to the 2011/12 Annual Report, 39 of the 50 posts in this tier are currently filled.
· A final report on the under-spending or misspending of the 2010 FIFA World Cup budget has been submitted, but recommendations will only be addressed in the 2012/13 financial year.
· The DAC’s Audit Committee considers the internal audit function to be under-resourced. The Committee reports that this hampers operations of the internal audit function and subsequently affects the ability to address the risks pertinent to the Department in its audit.
· The Department continues to under-spend. An amount of R131.1 million was not spent in the 2011/12 financial year.
5.2 Analysis of the Auditor General’s Opinion: 2011/2012 Financial Year
The Auditor-General (A-G) expressed the following opinion on the DAC’s financial statements:
· The DAC received an unqualified audit opinion.
· The A-G noted that the financial reporting framework prescribed by the National Treasury and applied by the department is not a compliance framework.
· The reported performance against predetermined objectives was deficient because it was not reported using National Treasury guidelines.
· A total of 21 per cent (27 out of 128) of major variances between planned and actual achievements were not explained as per the National Treasury Annual Report Preparation Guide.
· Adequate and reliable corroborating evidence could not be provided for 52 per cent (67 out of 128) of all major variances. The A-G did not obtain sufficient audit evidence to support reasons for major variances.
· There are instances where the Annual Report is not consistent with the Strategic Plan.
· Only 158 out of 232 planned targets were achieved during the year under review. A total of 32 per cent of planned targets were not achieved. The A-G notes that this was due to the fact that the Department did not have the staff capacity, to achieve planned targets.
· The financial statements submitted for audit did not comply with section (40)(1)(i) of the PFMA. Material misstatements were identified during the audit but were subsequently corrected.
· Contractual obligations and money owed by the Department were not settled within 30 days of receipt of invoice as required by section 38(1)(f) of the PFMA and Treasury Regulation 8.2.3.
· The accounting officer did not take reasonable steps to prevent irregular expenditure as required by sections 38(1)(c)(ii) and 39(1)(b) of the PFMA.
· The accounting officer did not always exercise oversight regarding financial and performance reporting and compliance and related internal controls. This indicates to a leadership problem within the Department.
With regards to financial
and performance management, the Department did not always prepare regular,
accurate and complete performance reports that are in compliance with laws and
regulations. Management did not adequately review and monitor compliance with
applicable laws and regulations to prevent non-compliance.
6. CONSIDERATION OF REPORTS OF THE COMMITTEE ON PUBLIC ACCOUNTS
The Committee on Public Accounts had not yet considered the Department of Arts and Culture 2011/2012 Annual Report.
7. RECOMMENDATIONS OF THE COMMITTEE
The Portfolio Committee on Arts and Culture, having analysed the strategic plan and discussed the 2011/12 annual report of the Department of Arts and Culture recommends the following:
The Minister should ensure that:
· The Department strives for a clean audit report in the 2012/13 financial year. An unqualified audit opinion is not an indication that non-financial performance is acceptable.
· Necessary steps are taken to prevent irregular expenditure as per sections 38(1)(c)(ii) and 39(1)(b) of the PFMA.
· Sufficient evidence is provided in instances where major variances occur. Failure to comply suggests that corruption exists within the Department.
· The quality of reports submitted to Parliament is improved and that the function and purpose of the Committee is taken seriously so as to work together to ensure that the DAC’s mandate is fulfilled.
· The Committee is informed of the international agreements and partnerships before the Department publicly announces them. Meetings should be held with the Committee detailing the nature of agreements and partnerships.
· Vacant positions at senior management level are fast tracked as failure to fill vacant posts impacts on achieving targets.
· The Department’s organogram is reviewed and staff skills and capacity are evaluated as some officials may be more suited to positions other than those they currently occupy.
· Acting positions within the Department and its entities are filled urgently. The Chief Financial Officer posts are critical as this is a contravention of Supply Chain Management (SCM) policy and procedure.
· Deviations from SCM are prevented and that a sound procurement policy is in place. Non-compliance with SCM is corruption.
· A Task Team is formed to monitor all projects within the Department including the quarterly reports on progress. The Chairperson of the Portfolio Committee should be considered as a member of this team.
· The Department works towards forming inter-departmental initiatives especially with the Departments of Basic Education and Tourism.
· A detailed analysis is submitted to Parliament on the possible merger of public entities where there is overlap of mandates.
· The problems within problematic public entities are clearly defined, such as the Pan South African Languages Board and the South African Heritage Resources Agencies.
· Timeframes are submitted within which problems within these entities would be resolved.
· Consideration is given to standardising remuneration of board members to ensure that they perform their functions effectively.
· There are guiding principles to ensure consistent approaches and standards in assessing the performance of the DAC and its public entities. Effective monitoring and evaluation systems should be put in place to track progress and identify problems and deficiencies in project implementation across the programmes, especially Social Cohesion and Mzansi Golden Economy projects.
· The internal audit function in the Department is enhanced to highlight weaknesses in the systems especially on risk management and fraud prevention. The internal audit function should be capacitated and fully operational.
· Internal capacity is built on a range of key functions of the Department and work towards doing away with the utilisation of consultants.
· Prolonged consultation with stakeholders is avoided as this hampers achieving planned targets.
· Targets that require the capacity of more than one staff member are met. Resignation as a reason for failure to meet planned targets is unacceptable.
· Board members of entities should receive thorough training and should be knowledgeable about Arts and Culture issues including administration.
· Performance agreements are signed. Senior management should be held accountable to ensure that accountability filters down to lower levels. Human Resources Management should have stricter controls over compliance with the Performance Management and Development System.
· An effective communication strategy for all stakeholders is developed, including that with the Portfolio Committee. Launches and other events must be communicated to the Portfolio Committee on time. The Committee does not appreciate late invitations or hearing about the DAC events from other sources. The staffing inadequacies within the Communications Unit should be addressed as a matter of urgency.
· The benefits of the MGE projects are effectively communicated to all communities. The Committee recommends that communities should be educated in the potential of the MGE strategy.
· Due consideration is given to the use of organic intellectuals instead of consultants especially in the National Language Service programmes.
Afrikaans is recognised as an indigenous language in
· The Department reports on the current projects which fill the gap created by the termination of the Investing in Culture (IIC) projects. With the disbanding of the IIC projects, many stakeholders are out of touch with DAC.
· A follow up is done on students who have received financial aid from the Department but who have not completed their studies and to provide Parliament with a detailed report.
· A report is provided to Parliament on the timeframes taken by the Department for employing individuals who have completed their studies in language studies.
· Consideration is given to strengthening celebrations around commemorative events by involving stakeholders and communities in related programmes.
· In the event that the Department requires acquisition of land to achieve a planned target, all ownership issues should be resolved.
· Controls are put in place to prevent expensive lawsuits. Matters should be resolved internally without the Department having to engage the services of legal counsel.
Report to be considered.