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Department of International Relations & Cooperation 2015/16 Annual Report Briefing to the Select Committee. 09 November 2016. Presentation Outline. Part A – General overview Part B – Performance Information Part C – Governance Part D – Human Resources Management
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Department of International Relations & Cooperation 2015/16 Annual ReportBriefing to the Select Committee 09 November 2016
Presentation Outline • Part A – General overview • Part B – Performance Information • Part C – Governance • Part D – Human Resources Management • Part E – Financial Information * Annual Financial Statements
General overview • Concluded South Africa’s year as Chair of the G77 & China • Successfully hosted AU Summit in June 2015 and FOCAC in December 2015 • The Foreign Service Bill was submitted to Parliament and is currently with the Portfolio Committee • The new organisational structure of the department was approved and is being implemented in phases • The Department is facing severe challenges with the reduced budget and the currency fluctuations • The expiry of contract of the Director General, Amb JM Matjila on 31 May 2016, just after the conclusion of the reporting period
Programme 4Sub-programme 4.1: Public Diplomacy • 19 out of 18 planned media briefings; • 197 out of 160 planned media statements; • 10 targeted opinion pieces Public Diplomacy Setting the agenda Own platforms 20 out of 19 targeted publications Ubuntu magazine available in digital format and SAA business lounges • 12 targeted Public Participation Programmes undertaken to create greater awareness of SA’s foreign policy priorities • Annual Diplomatic Fair • 2nd Annual Ubuntu awards Promotion and Branding SA and DIRCO
Programme 4Sub-programme 4.2: State Protocol(Service driven targets)
Risk Management • Risk Management Committee consisting of independent external members (Chairperson and Deputy Chairperson) and members of senior management structure • The Committee meets on a quarterly basis to review department’s reports on: • implementation of risk management activities which incorporates all areas of risk universe such as department-wide risk assessment reports, • performance information, audit reports, financial, assets management, property management, corporate management, project management and ICT reports • DIRCO received risk management Maturity assessment level 5, in accordance with the National Treasury’s Maturity Framework • Maturity level 5 indicates that risk management has a significant influence on the control environment and that risks aggregated and analysed bring substantial intelligence with regard to decision making in the department.
FRAUD AND CORRUPTION • The department maintains and implements a fraud and corruption prevention policy and strategy as part of its commitment to manage fraud and corruption risks • Reviews and updates the Fraud and Corruption Prevention Policy in line with its risk management framework • The department has developed a Whistle-blowing Policy in line with the Fraud and Corruption Prevention Policy • The suspected indication of fraud or corruption is either reported internally through appropriate channels (supervisors and/or the Risk Management Unit) or anonymously through the National Anti-Corruption Hotline.
Internal Audit & Audit Committee • Internal Audit During the reporting period, Internal Audit performed the following audit types at both Head Office and missions: • Compliance audits • Special audits • Consultations and or management requests • Information and communications technology audits
Audit Committee • The Audit Committee has complied with its responsibilities arising from Section 38 (1) (a) (ii) of the Public Finance Management Act, 1999 and Treasury Regulation 3.1.13. • The Audit Committee has also adopted appropriate formal terms of reference as its Audit Committee Charter, and has discharged its responsibilities in compliance with these terms of reference during the reporting period. • The Audit Committee has met at least four times during the reporting period, which is the minimum required in terms of its charter.
EMPLOYMENT AND VACANCIES AS AT 31 MARCH 2016 • Number of approved posts: 2564 (excluding Locally Recruited Personnel) • Number of filled posts: 2233 • Number of vacant posts: 331 • Vacancy rate: 12.9% as compared to 14,8% in the previous financial year
REASONS WHY THE VACANCY RATE REMAINED HIGHER THAN THE NATIONAL AVERAGE • High exit rate of 4,52% (101) • Internally appointed employees exceed external appointments • Migration and placement of incumbents took long due to consultations of employees affected • Only identified critical posts not affected by the new structure were prioritised for filling
WAY FORWARD • Full implementation of the structure is being done during the current financial year, after budget responsibility codes for new components could only take effect from 1 April 2016. • Non-critical posts will be identified to be frozen/abolished in order to implement the compensation of employees’ ceiling as instructed by National Treasury
Misconduct and disciplinary hearings finalised & Grievances lodged • 62.5% (5 out of 8) disciplinary cases were finalised within 90 days as prescribed • 47.2% (17 out of 36) grievances handled / finalised within 30 days
Performance Agreements by SMS • 83% (237 out of 287) SMS members submitted signed Performance Agreements by the deadline • One (1) SMS member was charged with misconduct for failure to submit performance agreement. The member, however, was not found guilty after the disciplinary hearing • The remainder of those who did not submit on time was due to the fact that their job descriptions were changed during the organizational review. As such they were given the grace period to submit after the deadline. • Some SMS members were promoted and still within the three-months eligibility period
Part E – Financial Information# 2015/16 Expenditure outcome #Commitments by Management to implement AG’s recommendations
Departmental Summary • The Department spent 102 per cent (R 6.6 billion) of its appropriated allocation of R 6.5 billion which represent a net overspending of R134 million. • The department recorded foreign exchange loss amounting to R134 million due to the depreciation of the Rand against major currencies which is attributable to expenditure incurred in missions abroad. However, the department also recorded savings on programme 3 and 4 which is as a result of cost containment measures that were implemented during African Union (AU) Summit and Forum on China-Africa Cooperation (FOCAC) Summit respectively and the unspent operational budget has been viremented to cover overspending in Programme 5.
PROGRAMME 1 EXPENDITURE OUTCOME AS AT 31 MARCH 2016 • During the period under review, the Programme continued to provide support with regard to the development of the overall policy and management of the department through efficient, effective and economical utilisation of scarce resources. • The expenditure for programme 1 is R1.4 billion, which represents an increase of twelve per cent as compared to the 2014/15 financial year. The increase in expenditure is due to the spending on construction projects for Dar Es Salaam and Lilongwe.
PROGRAMME 2 EXPENDITURE OUTCOME AS AT 31 MARCH 2016 • Expenditure increased significantly from R3.1 billion in 2014/15 to R3.6 billion in 2015/16 at nominal growth rate of sixteen per cent. This is mainly attributed to the depreciation of the Rand against other major foreign currencies. • The depreciation of the Rand resulted in high exchange rates, thus increasing operational costs incurred in missions abroad, including salaries and wages as well lease payments for office and residential accommodation. Consequently, the expenditure for programme 2 has exceeded the budget by R134 million.
PROGRAMME 3 EXPENDITURE OUTCOME AS AT 31 MARCH 2016 • Expenditure increases from R485.1 million in 2014/15 to R523.1 million in 2015/16 at nominal growth rate of eight per cent. The savings are mainly due to the cost containment measures that were implemented for operational expenditure.
PROGRAMME 4 EXPENDITURE OUTCOME AS AT 31 MARCH 2016 • Expenditure for programme 4 increased from R275.9 million in 2014/15 to R333.2 million in 2015/16 which represents an increase of twenty one per cent as compared to the 2014/15 financial year. The savings are mainly due to the cost containment measures that were implemented during African Union (AU) Summit and Forum on China-Africa Cooperation (FOCAC) Summit.
