The Department of Public Works (DPW) Minister Thulas Nxesi believes the department has now stabilised its leadership, with the appointment of a new Director-General and Chief Financial Officer, as well as other changes at leadership level. He says he’s always accepted as true that much of the department’s problems could be traced to a long period of unstable and constantly changing leadership.
The Minister revealed this during his Budget Vote Speech delivered in the second week of May 2013 in Parliament, Cape Town. The Budget Vote Speech affords the Minister a chance to account for what his department has done in the past year and explain what the department intends to do with the money that has been budgeted for the coming year.
Minister Nxesi said that the departmental budget allocation had been reduced by 20% from R7.7 billion in 2012/13 to R6.2 billion in 2013/14. He said the decrease is attributable to the phasing out of the devolution of the property rates grant to provinces; cabinet approved budget reductions of R1.5 billion over the Medium Term Expenditure Framework (MTEF); and shifting of R290 million to the Department of Home Affairs for border management in line with the devolution of budgets to line departments.
The Minister said that the department’s budget reflected government priorities and the department’s efforts to address – in particular – Outcomes 4, 8 and 12. “In relation to the National Development Plan (NDP), my department and the branches – are currently aligning their activities to support many of the identified goals of the NDP.”
Minister Nxesi used the Budget Vote Speech to also report to Parliament on the progress made in addressing major challenges experienced by the department. He said the turnaround project to ‘Rebuild the Department of Public Works’ is now well under-way.
“We now have the funding from National Treasury; the core of the Turnaround Team – now renamed the Business Improvement Unit - is in place under the office of the Director-General so that we build capacity in the department – not the Ministry - so if the Minister is recalled tomorrow, it will not derail the whole turnaround,” said the Minister.
He said the planning processes were well-advanced – with annual, 3-year and 7-year plans in place – developed in consultation with National Treasury.
The Minister said while the turnaround project designed to help return the department to full functionality, consists of 23 discrete projects, the main focus has been on taking control of five key areas which are: developing a complete credible register of state immovable assets; conducting a comprehensive audit of leases and the establishment of a Lease Management Framework; ensuring progressively improving audit outcomes for the DPW; actively reducing fraud and corruption in the DPW and Operationalising the Property Management Trading Entity (PMTE). Minister Nxesi says he can report clear progress on all these projects.
Focusing on the intention to combat fraud and corruption, the Minister says the department has worked closely with the Special Investigating Unit (SIU) to investigate a number of irregular leases and projects – some 40 investigations in all, of which 13 are completed. He says this has resulted in successful disciplinary actions, the dismissal of three officials including one Deputy Director-General (DDG), and court actions are underway to recover monies wrongly paid by the department.
“I need to add that as recently as last week; further suspensions of officials took place – pending disciplinary processes. SIU investigations, together with recent findings of the Competition Commission, tell the Formatted: Font: Bold same story: over-pricing and collusion between some officials and sections of the construction industry – a timely reminder that its takes two to tango; that corruption and greed in the private and public sectors are mutually reinforcing each other,” explained the Minister.
Minister Nxesi said the Prestige projects constitute a major area of collusion and irregular expenditure which has attracted negative publicity - deservedly.
“Given this profile, we have taken firm control of Prestige by centralising it, implementing a new structure, and creating a direct reporting line to the Director-General. This has already been accomplished, resulting in the cancellation of two high-priced projects, saving the department R18 million,” the Minister said. He added that all Prestige projects were undergoing investigation and that the process was complete in regard to Pretoria but the department was now focusing at Cape Town.
“Similarly many of the problems surrounding the security upgrade at Nkandla are rooted in the failure of supply chain management processes, poor management and lack of accountability. As a department, we have completed our investigation at the beginning of the year. We have referred our findings to the SIU for further investigation.
We are also cooperating with the Public Protector’s investigation. Parliament is planning to discuss our report, and the Auditor-General has undertaken to audit Prestige projects. I can assure honourable members, no stone is being left unturned. I have given an undertaking, that as a Department, we will act against any official where evidence of wrong-doing exists,” explained Minister Nxesi.
In conclusion; the Minister said while the magnitude and scope of the task that Public Works faces must never be underestimated, the department has now been stabilised. “We are making real progress in tackling the immediate and systemic challenges; and we have put in place the building blocks, and we have a plan, to rebuild Public Works,” said Minister Nxesi.
