Agenda 2008/09 - Expenditure Outcome 2009/10 - Budget Allocations

1. NPA Budget & Finance Briefing Portfolio Committee on Justice and Constitutional Development17 June 2009

2. Agenda • 2008/09 - Expenditure Outcome • 2009/10 - Budget Allocations • Budget vs Expenditure Status as at 31st of May 2009 • Audit Action Plan and Progress – 2007/08 • Possible Audit Qualification Issues - 2008/09 • Facilities • DSO relocation to SAPS

3. 2008/09 - Expenditure Outcome

4. 2008/09 Expenditure Outcome

5. 2008/09 Expenditure Outcome (Cont.)

6. 2009/10 - Budget Allocations

7. ENE Allocation per Sub-programme

8. ENE Allocation per Economic Classification

9. Budget Allocation 2009/10

10. Support Services Budget Allocation -2009/10 Note: Reprioritisation within the NPA resulted in the ENE allocated budget difference against the final allocated budget

11. Budget vs Expenditure Status as at 31st of May 2009 (Preliminary)

12. NPA Overall Budget & Exp as at 31st of May 2009 (Preliminary)

14. BU Overall Budget & Exp as at 31 May 2009

15. CS Overall Budget & Exp as at 31 May 2009

16. NPA Audit Action Plan and Progress – 2007/08

17. Disclaimer of Audit Opinion • Irregular, Fruitless & Wasteful Expenditure • Asset Management (Tangibles) • Leave Entitlement • Asset Management (Intangibles) • Prepayments and Advances • Financial Management • Lease commitments • Housing guarantees • Governance Issues

18. Irregular, Fruitless & Wasteful Expenditure Progress: • HR busy with organisational design of SCM processes & mapping. • Circulars, Practice Notes and Guidelines addressing the issues of non-compliance & adherence to SCM policies, have been issued. • Request for deviations are adequately reviewed and considered for approval from BU's. • IMU finalised the review on the SCM processes & procedures. • SCM training plan has been developed and weekly training sessions are being conducted.

19. Irregular, Fruitless & Wasteful Expenditure (cont.) Progress: • Condonation for R113 million was approved by the DG of DOJ&CD on the 18 March 2009. • Have met with the Accountant-General on the CFM lease and now awaits written confirmation • The understated amount of R86m was disclosed in the 2008/09 AFS. This matter is currently being investigated by the Irregular Committee. • Investigations have been finalised into SCM unit and a report has been submitted. • HRMD has instituted disciplinary proceedings against the alleged officials involved.

20. Asset Management (Tangibles) Progress: • The NPA Asset Register with values was provided to the AG on the 30th of April 2009. • Conducted 4 asset verifications during the 2008/09 financial year • Can fully account for all assets acquired during the 2008/09 financial year • Systems and procedures in place • Now focusing on correcting opening balances

21. Leave Entitlement Progress: • Continous monitoring, reviews & reconciliations are performed. • Various circulars have been distributed with regards to leave management. • Meetings held with management on leave management, leave related issues and concerns were discussed and solutions identified, i.e. Manco. • Corporate Manager meeting, etc. Roles and responsibilities with various actions identified were communicated during these sessions. • Management and monitoring of leave will also be included in the performance agreements of Corporate Managers.

22. Prepayments & Advances Progress: • NPA Management held meetings with OAG & Office of the Auditor-General on the 15 September 2008, 14 October 2008 & 13 May 2009. • The Accountant-General raised concerns on the cost benefit of the R22 million on the Sale & Lease Back of IT Equipment. • The NPA has requested a Forensic Audit on this Sale & Lease Back transaction.

23. Financial Management Progress: • To address late prioritization of funds, the joint budget committee reviews expenditure patterns to eliminate such future occurrences. • Expenditure is monitored in line with the draw-downs on a monthly basis to ensure that requests for virements & reprioritization of funds are adequately addressed.

24. Lease Commitments Progress: Cell Phone Lease Commitments – • New cell phone policy has been adopted & implemented. • Contracts now in the name of individual employees and not NPA. Finance Lease Commitments – • The matter was addressed with the OAG. Awaiting the determination of the National Treasury on the correct disclosure (whether it should be Finance or Operating Lease with particular reference to CFM). • Awaiting the outcome from NT.

25. Housing Guarantees Progress: • Management of the Housing Loan Guarantees is now progressing well. • Engagements with the relevant banking institutions • Housing Guarantee register is being updated and is monitored by the operations manager on a monthly basis. • Communication was forwarded to financial institutions to obtain the liability in respect of housing guarantees, • Where financial institutions have responded, records were updated. • Meetings have already been held with supervisors within the relevant section about the enforcing of standard controls.

26. SCOPA Resolutions Accountability Status of NPA: • This matter is still being considered by the Minister. Capacity & people related issues: • Review of the NPA Establishment. • Critical vacant posts have been advertised.

27. Governance Issues Progress – Strategic Plan: • Strategic Plan includes the measurable objectives, expected outcomes, indicators, etc. It is compliant with the NT guidelines. • The Strategic Plan was presented at high level to Minister for approval. • A stakeholder workshop was held on 12th March 09 to provide input on the strategic plan. • The NPA Strategic Plan for 2009-2012 is ready for sign-off and printing

28. CARA Audit Action Plan and Progress – 2007/08

29. Disclaimer of Audit Opinion • Asset Forfeiture Unit Case Register • The AFU case register is the only source for the identification and monitoring of court cases that will affect the Criminal Asset Recovery Account. • Total monetary value declared confiscated and forfeited in these cases, dating back to 2000, that had not been followed up amounted to R163 million.

30. Disclaimer of Audit Opinion (Cont.) • Forfeiture assets and monies receivable from confiscation and forfeiture orders not disclosed in AFS. • CARU did not maintain an asset register in order to account for all the assets forfeited to the State. As a result of the incomplete case register it is not possible to quantify the effects of non disclosure.

31. Audit Action Plan • In order to address all the above audit concerns, an Audit Action Plan was developed to monitor and review progress on a monthly basis. • Management information is reported to the DG –DOJCD, NPA EXCO monthly and CS MANCO fortnightly and periodically to Audit Committee.

32. Progress • CARU Unit has filled the 3 of the 4 permanent vacant positions in April/May 2008 (Total establishment 5). • CARU has appointed 5 interns in April 2008 to assist in updating over 1800 case files. • CARU is working with AFU on the Electronic Case Management System. • CARU has implemented a manual case follow up system to monitor unfulfilled cases with the curators, AFU and other stakeholders. • CARU has started with regional visits since October 2008. • Consultants have been appointed to review the AFU/CARU functions and to advise on possible solutions for the units to obtain an unqualified audit opinion in the AFS.

33. Possible Audit Qualification Issues – 2008/09

34. Possible Audit Qualification Issues - 2008/09 • Asset Management (Tangibles) – opening balances, values, completeness • Leave Entitlement • Lease Commitments • Governance Issues • Audit Action Plan in place to address these issues

35. Facilities

36. Facilities • NPA no separate capital budget • Capital budget held in Programme 2: Court Services • NPA capital budget allocation for 2009/10 = R20 million • NPA managing the following facilities: ?? • Challenges: • Lack of funding – Innes Chambers – R189 million • DSO handover – Promat complex • Accommodation for prosecutors at the lower courts

37. DSO transfer to SAPS

38. DSO transfer • Proposed fixed date = 5 July 2009; consent date = 5 June 2009 • 28DSO investigators have transferred to SAPS before the fixed date – budget will follow investigative capacity • 214 DSO investigators have consented to transfer to SAPS on the fixed date – budget will follow investigative capacity • 70 DSO investigators that have not consented to the transfer to SAPS have been offered alternative placement at SIU – budget will follow to SIU • DSO prosecutors and administrative support will remain with the NPA – budget stays with NPA

39. DSO transfer • DSO = subprogramme of the NPA • DSO ENE budget 2009/10 = R298 million; (2008/09 = R429 million) • Have agreed with SAPS to negotiate the amount of budget to be transferred based on the number of DSO investigators (salary bill plus operational budget) • Budget transfers will be finalised during the Adjustment Estimates

40. DSO transfer • DSO assets and liabilities were determined and verifications were performed • DSO assets and liabilities will be transferred to SAPS on fixed date • Special arrangements in place for covert assets • Facilities – SAPS will find alternative accommodation for DSO investigators that transfer to SAPS • Promat complex – in discussions with SAPS on the possible use of the complex by SAPS as headquarters of the DPCI

41. Thank You!