SCOPA to Call Minister of Defence and Military Veterans on Audit Outcomes for the 2023/24 Financial Year

To download the soundbite of the Chairperson of SCOPA, Mr Songezo Zibi click here: https://iono.fm/e/1504013

Parliament, Tuesday, 19 November 2024 - After receiving a briefing from the Auditor-General (AG) on the 2023/24 financial year audit outcomes of the Department of Defence (DoD) and the Department of Military Veterans (DMV) and Denel, the Standing Committee on Public Accounts (SCOPA) has resolved to call the Minister of Defence and Military Veterans, Ms Angie Motshekga to respond to various issues emanating from the audit outcomes.

Members of the committee were particularly concerned with:

• Consecutive annual audits in which the departments of defence and military veterans obtained adverse audit outcomes with neither the apparent willingness nor ability to improve.
• A string of material irregularities in which senior officials failed to hold those responsible accountable either for maladministration, malfeasance or failure to meet performance objectives.
• The challenges posed by the DoD structure and distribution of power and its negative impact on the implementation of consequence management through the material irregularities process instituted by the AG. While the Secretary of Defence is accounting officer as outlined in section 38 of the Public Finance Management Act (PFMA), he/she cannot lawfully take disciplinary steps against members under the purview of the chief of the South African National Defence Force (SANDF) despite multiple years of failure to comply with the Public Finance Management Act.
• The lack of comprehensive audit action plans to address prior year audit matters and their effective implementation and monitoring, resulting in recurring audit findings.
• The lack of funding and the deteriorating state of the department's assets and capabilities resulting in the non-achievement of planned targets regarding the number of flying hours and the number of sea hours. In the 2023/24 financial year, the Air Force only flew 6 904.06 hours instead of the target of 12 000 flights per year and the Navy spent 2 641,47 hours at sea instead of the 8000 targeted hours, as set out in its annual performance plan. The decline in the available budget to make repairs and maintenance on the existing vessels and aircraft is one of the root causes for failure to meet the targets which has resulted in a Navy and Air Force that is hardly operational.
• The slow implementation of the Denel's turnaround strategy taking into account the R3.4 billion bailout the entity received in the 2022/24 financial year.
• The lack of an ICT system database for military veterans and the benefits owed to them on retirement.

Both departments have received a qualified audit opinion with findings while Denel did not submit financial statements on time for the 2023/24 financial year audit. Denel has consistently received a disclaimed audit opinion for the past six years since the 2018/2019 financial year. The committee plans to meet with the Minister before Parliament rises for the end of the year recess.

The committee will issue a formal invitation to the Minister during the course of the week, inviting her to explain the steps she is taking to improve what is clearly a crisis of accountability and funding.

ISSUED BY THE PARLIAMENTARY COMMUNICATION SERVICES ON BEHALF OF THE CHAIRPERSON OF THE STANDING COMMITTEE ON PUBLIC ACCOUNTS, MR SONGEZO ZIBI.

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