Home Affairs Minister, Dr Nkosazana Dlamini Zuma: Home Affairs achieves first unqualified audit in sixteen years

29 Sep 2011

We are today, Thursday, 29 September 2011, tabling our Annual Report for the 2010/ 11 financial year in both Houses of Parliament - the National Assembly and the National Council of Provinces - in Cape Town in line with prescripts of the Public Finances Management Act, 29 of 1999 (PFMA).

When we assumed the Portfolio of Home Affairs on 12 May 2009, we made certain commitments to the nation to ensure the Department of Home Affairs and other entities in our family, the Independent Electoral Commission (IEC), Government Printing Works (GPW) and the Film and Publications Board (FPB), is able to deliver excellent services to all our people.

One of the critical issues in this regard, was the need to ensure public finances under the management of the Department of Home Affairs are spent prudently and efficiently, to ensure effective and efficient service delivery.

In this regard, we stated during our Budget Vote in June 2009 that, "we shall work towards a much improved audit report. We have to tackle the revenue management and all the areas of concern indicated by the Auditor-General." We further committed ourselves to ensuring the achievement of an unqualified audit report within a period of two years.

We are happy to announce that, in line with our commitment to the public and having put the necessary financial management mechanisms in place, in line with the PFMA, the Auditor-General has found it fit and proper to issue an unqualified audit opinion on the department's finances for the 2010/ 2011 financial year.

The significance of this development is that this is the first unqualified audit report on the Department of Home Affairs finances in sixteen years, since the dawn of peace, freedom and democracy in South Africa in 1994.

We must however at this time be reminded of the words of that giant amongst our people, Nelson Rolihlahla Mandela, when he said, "I have walked that long road to freedom. I have tried not to falter; I have made missteps along the way. But I have discovered the secret after climbing a great hill; one only finds that there are more hills to climb. I have taken a moment here to rest, to steal a view of the glorious vista that surrounds me, to look back on the distance I have come. But I can rest only for a moment for with freedom come responsibilities and I dare not linger, for my walk is not yet ended." In addition, for us, the long walk is certainly not at an end.

In our walk towards an unqualified audit opinion, the Department of Home Affairs has become a normal department, simultaneously achieving improved levels of service delivery. We hope that all our officials, across the length and breadth of our country are proud of this achievement and are inspired to do more in the future towards building a new Home Affairs. We would like to express our unreserved appreciation for their support.

This would not have been possible without the solid and hard work of the team of senior managers at headquarters and provinces, led by our Director-General, Mkuseli Apleni, our Chief Financial Officer and Rudzani Rasikhinya, who led the team that toiled through night and day to ensure the Department meets its obligations in terms of the PFMA and Treasury Regulations.

We also take this opportunity to extend our gratitude to the National Treasury, the Audit Committee and members of the Home Affairs Portfolio Committee, for the support and guidance provided to the department in the period, leading to the issuance of an unqualified audit report by the Auditor-General.

Deputy Minister, Fatima Chohan and myself remain grateful for the unflinching efforts of our management teams at the Department of Home Affairs, IEC, FPB and GPW, which resulted in unqualified opinions for all family members.

We are very conscious that, this achievement poses a greater responsibility upon us all, to maintain unqualified audit opinions in future and to do even better in the years to come.

We must remember, as former President Thabo Mbeki reflected: "those who complete the course will do so only because they do not, as fatigue sets in, convince themselves that the road ahead is still too long, the inclines too steep, the loneliness impossible to bear and the prize itself of doubtful value."

We must therefore continue on this course. We have to use departmental finances well, while striving to achieve new heights, as we discharge our mandate to render services to all our people.

How was this achieved?

The Department implemented effective internal control measures that included, amongst others, weekly follow ups on issues raised in the previous financial year by the Auditor-General. As a result, the following measures were implemented in the areas of finance and supply chain management, revenue and budget management, asset management and general control programmes:

Finance and Supply Chain Management

• relevant structures were capacitated to ensure sound financial management and procurement processes were in place and implemented
• all unfunded mandates which resulted in unauthorised contracts, leading to the Department being in debt, were reviewed and approval was sought from National Treasury for the settlement of such debts
• service level agreements were concluded for the provision of key services including amongst others, State Information Technology Agency (SITA) for Information Technology (IT) related projects.

Revenue and Budget Management

Budget

• the allocation of resources to the strategic objectives of the department to ensure that all operational costs are budgeted for, with a view to avoiding huge debts which had previously been incurred by the department
• a register of all leases was compiled to ensure that lease commitments were budgeted for as well as the utilisation of all state and leased accommodation.

Revenue

• measures were implemented to clear backlogs on foreign mission transactions, in terms of income and expenditure for operations conducted abroad by Home Affairs officials based in South African missions, in which supporting documentation for these transactions were availed for audit purposes. At year-end inter-departmental debts were settled between the two departments
• areas of non-compliance in provinces were addressed through the provision of support to all revenue administering offices throughout the country, hence the clearance of bank exceptions.

Asset Management

• further to the qualification on capital assets in the 2009/ 10 financial year, in which the department was using consultants, the department in the 2010/ 11 financial year established an asset management team compromising its own officials to correct weaknesses identified in the 2009/10 financial year by:
  • verifying all the assets, including additions, following which a new asset register was compiled, which is compliant with the minimum requirements of the asset management framework
  • officials had to confirm all assets in terms of the existence and location during the verification process
• This yielded a positive outcome in terms of the audit opinion.

General control programmes

• the appointment of appropriately skilled individuals, in whom an appreciation of the PFMA and Treasury regulations were inculcated
• directors Finance and Support as well as district managers: Operations were appointed
• frontline offices were capacitated with additional staff to render services
• the implementation of monitoring and evaluation processes, which led to clearance of issues raised by the Auditor-General in terms of revenue and asset management
• structures were put in place to manage activities within the department and to continuously guide operations towards the achievement of the department's strategic priorities
• we also collaborated with oversight committees including, amongst others, the Parliamentary Portfolio Committee on Home Affairs, National Treasury, Parliament's Standing Committee on Public Accounts (SCOPA) and the Auditor-General, to ensure an unqualified audit
• monthly meetings are held with top management, as well as quarterly reviews with all managers, including heads of office, to resolve strategic and operational issues that may compromise the department.

Statement issued by Department of Home Affairs, September 29 2011

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