1. Private Security Industry Regulatory Authority PRESENTATION ON THE PRIVATE SECURITY INDUSTRY REGULATORY AUTHORITY’S 2008/2009 ANNUAL REPORT TO THE PORTFOLIO COMMITTEE OF POLICE

2. DELEGATION: MINISTERIAL INTERVENTION TASK TEAM (MITT) 1.Mr Benjamin Ntuli 2.Ms Poppy Baloyi 3.Mr John Makina STAFF OF AUTHORITY 1.Mr Hendrick Mahlangu 2.Ntusi Mbodla 3.Ms Maureen Makgabo PRIVATE SECURITY INDUSTRY REGULATORY AUTHORITY

3. PRESENTATION 1.Policy related matters -Communications Mr Benjamin Ntuli Chairperson Ministerial Intervention Task Team 2.Law EnforcementMr Ntusi Mbodla Deputy Director Law Enforcement 3.Human ResourcesMs Maureen Makgabo Acting Manager: Human Resources 4.FinancialsMr Hendrick Mahlangu Deputy Director: Finance & Administrator 5.Conclusion 6.Questions/Comments

4. 1 *Statutory requirements for the establishment of the Authority. *Report on the Authority’s activities during the 2008/2009 financial year. *Audited financial statements for the 2008/2009 financial year *Key stakeholders and challenges facing the Authority. *Key strategic objectives to address challenges. OVERVIEW OF PRESENTATION

5. 1.Established in terms of Section 2(1) and 2(2) of the Private Security Industry Regulation Act, 2001 *To provide for the regulation of the private security industry. *To provide for the Governance of the Authority by a Council of persons who are independent of the private security industry. 2.Public Finance Management Act (PFMA) – Public Entity in terms of Section 47 *Listed as a public entity on 19 September 2008. *Schedule 3A National Public Entity 2 STATUTORY REQUIREMENTS FOR THE ESTABLISHMENT OF AUTHORITY

6. 3.Governance of the Authority *The Authority is governed and controlled by the Council as contemplated in Section 6 in accordance with the Private Security Industry Regulation Act, 2001. *The Authority acts through Council and all acts of the Council are regarded as acts of the Authority. *The Council of the Authority is constituted by: (a)Chairperson; (b)Vice-Chairperson and (c)Three additional Councillors Appointed by the Minister in consultation with Cabinet. 3 STATUTORY REQUIREMENTS FOR THE ESTABLISHMENT OF AUTHORITY

7. 4.Accountability of Council The Council is accountable to the Minister for the performance of its functions (Section 10). In terms of the Public Finance Management Act, the Council is also the accounting authority. 5.Ministerial Supervision of Authority If the Council of the Authority cannot or does not maintain an acceptable standard in the fulfilment of one or more of its functions in terms of the Act or the Levies Act, the Minister may intervene by taking any appropriate step to ensure proper fulfilment of that function (Section 11). 4 STATUTORY REQUIREMENTS IN TERMS OF THE ACT AND REGULATIONS STATUTORY REQUIREMENTS IN TERMS OF THE ACT AND REGULATIONS (…cont’d)

8. The term of Council expired on 31 August 2008. Subsequent to the expiry of the term of Council, the Minister acting in terms of Section 11 of the Private Security Industry Regulation Act, 2001 (Act No. 56 of 2001) appointed a Ministerial Investigation Task Team on 3 March 2009 to conduct an in depth enquiry into: *The functioning of the Authority with the particular focus on all factors that impede the functioning and the effectiveness of PSIRA as a regulatory body. *Identify threats and challenges facing the Authority. 5 STATUTORY REQUIREMENTS IN TERMS OF THE ACT AND REGULATIONS STATUTORY REQUIREMENTS IN TERMS OF THE ACT AND REGULATIONS (…cont’d)

9. 6 The Ministerial Investigation Task Team comprised of four members, namely: (a)Ms Jenny Irish-Qhobosheane (b)Mr Josiah Jele (c)Mr Dumisweni Zimu (d)Adv. Anton Wiid

10. The Ministerial Investigation Task Team concluded their investigation and reported to the Minister. Subsequent to receiving the report, the Minister appointed a Ministerial Intervention Task Team (MITT). The MITT consisted of the following members: (a)Mr S B Ntuli (b)Ms P C Baloyi (c)Mr C J Makina (d)Commissioner Phahlane (e)Assistant Commissioner T Khulu (The Police Representative) (f)Mr P T Mashigo (NIA Representative) 7 STATUTORY REQUIREMENTS IN TERMS OF THE ACT AND REGULATIONS STATUTORY REQUIREMENTS IN TERMS OF THE ACT AND REGULATIONS (…cont’d)

11. 8 The mandate of the MITT was to: *To oversee, on a day-to-day basis, the governance and management of PSIRA and to provide leadership and guidance in order to improve service delivery. *To work closely with the Auditor-General in performing a forensic audit of PSIRA, and with the South African Police Service in having allegations of corruption within PSIRA investigated and to ensure that the necessary disciplinary and other steps are taken against any employee of PSIRA involved. *To ensure the execution of a performance audit in PSIRA as to assess whether performance of the personnel is in compliance with what could reasonably be expected and to take remedial steps where required. *To address any outstanding matters regarding the employment of the Director (Chief Executive Officer) of PSIRA, in other words the finalisation of the case against the CEO (who has been on suspension for more than a year without resolution of the charges against him).

12. 9 STATUTORY REQUIREMENTS IN TERMS OF THE ACT AND REGULATIONS STATUTORY REQUIREMENTS IN TERMS OF THE ACT AND REGULATIONS (…cont’d) *To assess the use of resources at PSIRA at national and provincial level and to ensure that principles of value for money are adhered to. This will need to include both service delivery and management related issues. *To oversee the appointment process regarding the filling of vacant posts advertised by PSIRA on 28 June 2009, in a Sunday newspaper. *To follow-up deficiencies identified at PSIRA as set out in the Report of the Ministerial Task Team, as well as the response of the South African Police Service thereto. *To report any problems being experienced in the process directly to the Minister. *To undertake a thorough assessment and audit of the ability of management to fulfil the functions assigned to them in terms of the Private Security Industry Regulation Act of 2001.

13. 10 STATUTORY REQUIREMENTS IN TERMS OF THE ACT AND REGULATIONS STATUTORY REQUIREMENTS IN TERMS OF THE ACT AND REGULATIONS (…cont’d) *To evaluate the functioning of and issues pertaining to the integrity of Information Technology and database systems within the Authority. *To provide the Minister with a final report at the end of the 90 days period. The report should be accompanied by an implementation plan developed by MITT.

14. ORGANISATIONAL STRUCTURE OF THE PRIVATE SECURITY INDUSTRY REGULATORY AUTHORITY DEPUTY DIRECTOR: FINANCE & ADMINISTRATION Hendrick Mahlangu (Acting Director) DEPUTY DIRECTOR: LAW ENFORCEMENT Ntusi Mbodla DIRECTOR (Vacant) MANAGER: NATIONAL INVESTIGATION TEAM Stefan Badenhorst MANAGER: WESTERN CAPE (Cape Town) Douglas Roman MANAGER: REGISTRATIONS Ali Malesa MANAGER: INFORMATION TECHNOLOGY Howard Nkune Organisation Structure as per Section 14(1) Additional Senior Management Positions SATELLITE BRANCH Gauteng Johannesburg SATELLITE BRANCH Northern Province (Polokwane) SATELLITE BRANCH Eastern Cape (Umtata) SATELLITE BRANCH Northern Province (Nelspruit) DEPUTY DIRECTOR: LAW ENFORCEMENT Ntusi Mbodla DEPUTY DIRECTOR: TRAINING & COMMUNICATION (Vacant) CHIEF INFORMATION OFFICER Simon Nkosi GENERAL MANAGER: HUMAN RESOURCES (Vacant) MANAGER: FINANCE Chris Dreyer MANAGER: EASTERN CAPE (Port Elizabeth) Dave van Dyk MANAGER: KWAZULU- NATAL (Durban) Vuyo Majola-Dlamini MANAGER: COMMUNICATIONS Siziwe Zuma 11 MANAGER: HUMAN RESOURCES Maureen Makgabo (Acting Manager)

15. A.COMMUNICATIONS DEPARTMENT 12

16. The following are the objectives of the Communications Department: *To develop, implement and drive the communication strategy with specific reference to the Authority’s vision and strategic focus amongst all stakeholders through an effective marketing approach. *To create a dynamic and appealing image of the Authority *Media Relations Management and Policies *Stakeholder relations *Internal and external communication 13 COMMUNICATIONS

17. B.LAW ENFORCEMENT & TRAINING DEPARTMENT 14

18. REGIONNUMBER OF INSPECTIONS Head Office (National Investigation Team3,778 ● Gauteng ● Mpumalanga ● Limpopo ● North West Province ● Free State / Northern Cape 2,065 376 495 427 415 Western Cape650 Eastern Cape307 KwaZulu-Natal1,718 TOTAL6,453 * Page 13 – 17 of Annual Report 15 NUMBER OF INSPECTIONS CONDUCTED PER PROVINCE

19. REGIONNUMBER OF DOCKETS Head Office (National Investigation Team)826 Western Cape111 Eastern Cape108 Kwazulu Natal257 TOTAL1,302 * Page 17 – 18 of Annual Report 16 NUMBER OF IMPROPER CONDUCT INVESTIGATION DOCKETS COMPILED PER BRANCH

20. REGIONNUMBER OF DOCKETS Head Office (National Investigation Team)622 Western Cape13 Eastern Cape3 Kwazulu Natal97 TOTAL735 * Page 18 of Annual Report 17 NUMBER OF IMPROPER CONDUCT DOCKETS PENDING PERTAINING TO MINIMUM WAGE CONTRAVENTIONS PER BRANCH

21. REGION OPENING – 1 APRIL 2008 NEW CRIMINAL CASES OPENED CRIMINAL CASES FINALISED CRIMINAL CASES PENDING WITH SAPS INCL. THOSE BEFORE 1 APRIL 2008 Head Office (National Investigation Team) 5036626543 Western Cape138134147 Eastern Cape14151316 Kwazulu Natal124101133 TOTAL77910444839 * Page 18 – 19 of Annual Report 18 Criminal cases pending refer to all cases pending with the SAPS from previous financial years. NUMBER OF CRIMINAL CASES OPENED PER BRANCH

22. * Page 19 – 20 of Annual Report Number of Enquiries Received Fees not paid Registration Suspended / Withdrawn / Unregistered / Failed to inform Authority i.r.o changes, other. Requested more firearms than staff complement, members not trained etc. Favourable Recommendation 19 FIREARM APPLICATION ENQUIRIES

23. Charge Sheets Summonses * Page 20 of Annual Report 20 CHARGE SHEETS & SUMMONSES ISSUED 1 April 2007 – 31 March 2008 vs 1 April 2008 – 31 March 2009

24. Course reports on hand - 31 March 20088,572 Course reports received from 1 April 2008 to 31 March 2009508,062 Course reports processed from 1 April 2008 to 31 March 2009486,286 Course reports returned from 1 April 2008 to 31 March 200920,324 Course reports carried over to April 200910,024 * Page 22 of Annual Report 21 TRAINING COURSE REPORTS PROCESSED

25. There are a number of challenges currently being addressed by PSIRA and SASSETA pertaining to the implementation of the Memorandum of Understanding. These includes, inter alia, the following: *Finalization of the development of learning material in respect of all the skills programmes. *Capacity building within the training industry for all categories or classes of security service providers. This is obviously subject to the publication of the training regulations. *SASSETA national footprint. In this regard SASSETA requested the Authority to consider making office space available within the PSIRA infrastructure for certain dates to host a SASSETA practitioner/administrator. This matter is under consideration. 22 PSIRA / SAFETY AND SECURITY SECTOR EDUCATION & TRAINING AUTHORITY (SASSETA) INTERACTION

26. *Quality Assurance of the generic management level 4 and 5 skills programmes. *Alignment of databases in order to retrieve information from the SASSETA learner database in order to facilitate registration of applicant security service providers. *Changing SAQA environment with the publication of the National Qualifications Framework Act and the establishment of the Quality Councils and uncertainty of the continued existence of SASSETA. 23 PSIRA / SASSETA INTERACTION

27. C.LEGAL SERVICES DEPARTMENT 24

28. MONTHNITW/CAPEE/CAPE KWAZULU- NATAL TOTAL April 200839249173 May 20081912131559 June 2008382642088 July 200892341753 August 200860272998 September 200837112564 October 2008418132183 November 2008259161363 December 200810045 January 20094501046 February 20092615121669 March 200942316447 Total34416891145748 * Page 27 of Annual Report 25 NUMBER OF IMPROPER CONDUCT ENQUIRIES FINALIZED PER BRANCH

29. MonthRefusals WithdrawalsAppeals Exemptions Section 26(4)(a) Section 26 (4)(d) Criminal RecordForeignerCode of Conduct Up- held Dis-missed Up- held Dis- missed Up- held Dis- missed Apr 0882619152114001 May 0838800204703102 Jun 0867223174710101 Jul 0852304668313101 Aug 0825541262010303 Sep 084430005000001 Oct 08464417212440101 Nov 08346511695810001 Dec 0847800453301100 Jan 0920011115143200111 Feb 091,10400624111120 Mar 0942532891610101 TOTAL6,12430188364472111211313 * Page 27 – 28 of Annual Report 26 LEGAL SERVICES STATISTICS FOR THE PERIOD 1 APRIL 2008 – 31 MARCH 2009

30. Enquiries Approved Denied Require further information Payments received 3,489 2,735 666 88 R1,027,507.04 * Page 28 of Annual Report 27 TENDER ENQUIRY STATISTICS 2008 / 2009

31. D.REGISTRATION DEPARTMENT 28

32. ACTIVE REGISTERED SECURITY BUSINESSES ACTIVE REGISTERED SECURITY OFFICERS * Page 29 of Annual Report 29 SECURITY SERVICE PROVIDER REGISTRATION STATISTICS (2001 – 2009) – HISTORICAL COMPARISON

33. Gauteng – 39% KwaZulu-Natal – 16% Northern Cape – 1% Free State – 4% North West – 7% Limpopo – 7% Western Cape – 10% Eastern Cape – 9% Mpumulanga – 7% 30 REGISTERED ACTIVE SECURITY SERVICE PROVIDERS – INDIVIDUALS PER PROVINCE (MARCH 2009)

34. 31 * Page 29 of Annual Report Gauteng – 37% KwaZulu-Natal – 15% Northern Cape – 1% Free State – 4% North West – 4% Limpopo – 13% Western Cape – 12% Eastern Cape – 7% Mpumulanga – 7% REGISTERED ACTIVE SECURITY SERVICE PROVIDERS – BUSINESSES PER PROVINCE (MARCH 2009)

35. E.INFORMATION TECHNOLOGY 32

36. The IT services relating to software support and hardware support have been outsourced to external IT service providers, namely Ntier and BCS-Net respectively. Activities during the period under review include: *Development, implementation of IT policies and procedures; *Improvement of system security; and *Linkage of databases with NIA to improve crime prevention. 33 KEY IT PERFORMANCE AREAS COVERED IN THE ANNUAL REPORT

37. F.HUMAN RESOURCES 34

38. The Human Resource unit within PSIRA is responsible for amongst others, the following : *Recruitment and staff retention *Employment equity plan *Skills development *Industrial Relations 35 KEY HR PERFORMANCE AREAS COVERED IN THE ANNUAL REPORT

39. Permanent Appointments38 Temporary Appointments10 Resignations23 Terminations due to end of contract6 Terminations due to misconduct3 Termination due to death1 Vacancies36 NEW APPOINTMENTS, TERMINATIONS FOR THE PERIOD UNDER REVIEW:

40. Occupational levels DesignatedNon-Designated Total MaleFemaleMale Foreign nationals ACIACIWWMF Top Management 11 Senior Management 33 Professionally qualified and experienced specialists and middle management 6132315 Skilled technical and academically qualified workers, junior management, supervisors, foremen, and superintendents 202811041 Semi-skilled and discretionary decision making 32161133171128 Unskilled and defined decision making 5611 TOTAL PERMANENT 6722781332014199 GRAND TOTAL 6722781332014199 A = African C = Coloured I = Indian W = White 37 PSIRA remains committed to taking affirmative steps to ensure the provision of equal opportunities for all employees at all levels. Workplace Profile by occupational level (including employees with disability) in terms of the Employment Equity Act EMPLOYMENT EQUITY

41. 38 Skills development and training of employees at all levels remained key to the achievement of the PSIRA’s core strategy. PSIRA continued to invest in the development of its people. Training provided to employees by Occupational Category Occupational categories DesignatedNon-Designated Total MaleFemaleMale Foreign nationals ACIACIWWMF Legislators, senior officials & Managers 325 Professionals 11 Technicians and associate professionals 3115 Clerks 3162223 Elementary occupations 11 TOTAL PERMANENT 111922135 GRAND TOTAL 111922135 A = African C = Coloured I = Indian W = White SKILLS DEVELOPMENT AND TRAINING

42. G.FINANCE AND ADMINISTRATION 39

43. *Listed as Schedule 3 A National Public Entity *Non-compliance with the Public Finance Management Act (1 of 1999) *Qualified audit report *Sources of revenue – levies and administrative fees *Going concern 40 OVERVIEW OF THE FINANCE AND ADMINISTRATION DEPARTMENT

44. H.AUDITED FINANCIAL STATEMENTS 41

45. Sources of Revenue 2009%2008% Sales of Goods7,670,8944.712,005,7152.11 Levies52,575,37766.5246,300,70748.73 Fines & Penalties935,1921.183,210,3853.38 Other Income14,258,34518.0441,442,93943.62 Interest Received3,598,0964.552,056,9012.16 79,037,90410095,016,647100 Revenue 42 STATEMENT OF FINANCIAL PERFORMANCE

46. Expenditure 2009% % Employee Costs38,544,14246.233,3642,87235.68 Other Operational Expenses28,338,54333.9725,229,40626.70 Provision for Bad Debt14,287,58117.143,591,5943.18 Penalty Concession0-29,582,09331.37 Depreciation2,220,4002.662,241,4552.38 Finance Costs0-53,8920.06 83,390,66610094,341,312100 Expenditure 43 STATEMENT OF FINANCIAL PERFORMANCE

47. 20092008 Revenue79,037,90495,016,647 Expenditure83,390,66694,341,312 Surplus Deficit-4,352,762675,355 Summary : Statement of Financial Performance 44 STATEMENT OF FINANCIAL PERFORMANCE

48. Statement of Financial Position Current and non-current assets 2008/09 R 2007/08 R Increase / (Decrease) Loans and receivables5 889 7794 758 0401 131 739 Cash and cash equivalents31 964 14630 316 9161 647 230 Property plant and equipment10 471 55011 180 378(708 828) 48 325 47546 255 3342 070 141 Statement of Financial Position Current and non-current liabilities 2008/09 R 2007/08 R Increase / (Decrease) Trade and other payables32 266 65016 392 06615 874 584 Provisions1 854 368773 9071 080 461 Lease obligations442 761376 15666 605 Retirement benefits4 190 0001 546 0002 644 000 38 753 77919 088 12919 665 650 Net Assets Accumulated surplus (reserves)9 571 69627 167 205(17 595 509) 48 325 47527 167 20521 158 270 45 ANNUAL FINANCIAL STATEMENTS ANALYSIS

49. CASH FLOWS FROM OPERATING ACTIVITIES 2008/09 R 2007/08 R Receipts Sales of goods and services60 020 45258 627 118 Interest received3 598 0962 056 901 Payments Payments to suppliers and employees(60 443 839)(53 225 209) Interest paid-(53 892) Net cash flows from operating activities3 174 7097 404 918 CASH FLOW FROM INVESTING ACTIVITIES Proceeds on disposal of equipment6 6674 509 Acquisition of equipment(1 534 146)(1 798 270) Net cash flows from investing activities(1 527 479)(1 793 760) Net increase in cash and cash equivalents1 647 2305 611 158 Cash and cash equivalents at start of period30 316 91624 705 758 Cash and cash equivalents at end of period31 964 14630 316 916 46 ANNUAL FINANCIAL STATEMENTS ANALYSIS (…cont’d)

50. 20092008 Current and Non Current Assets48,325,47546,255,334 Current and Non Current Liabilities38,753,77919,088,129 Accumulated Surplusses (Reserves)9,571,69627,167,205 Statement of Financial Position 47 STATEMENT OF FINANCIAL POSITION

51. *Disclaimer Unknown deposits amounting to R11 709 278 Value added tax liability - R16 807 178 Property plant and equipment – revaluation and impairment Other income - supporting documentation *Emphasis of matter Trade debtors - penalty concession Fruitless and wasteful expenditure - printer cartridges and leased premises *Other matters Non compliance with legislation - PFMA and Treasury Regulations Governance framework and internal control deficiencies 48 AUDIT REPORT / OPINION

52. KEY CHALLENGES OF THE AUTHORITY 49

53. 1.Sustained growth and the increasing importance of the private security industry in the fight against crime (public / private policing partnerships) 2.Renewal of registrations and on-going security vetting 3.Firearms control within the private security industry 4.Compliance by the Private Security Industry during the 2010 FIFA World Cup 5.Strengthening the legislative and regulatory framework 6.Establishing a national footprint and increasing public profile 7.Deployment of unregistered and untrained foreign nationals in the industry 8.Industry accountability 9.Extra-territorial enforcement 10. Long outstanding uncollected debts 50 KEY CHALLENGES FOR THE AUTHORITY

54. 1.Government security establishments i.e. SAPS, NIA, NPA 2.Government Departments i.e. SARS, Home Affairs, Department of Labour and Others 3.Employer organizations i.e. SIA and Others 4.Employee organizations (SATAWU and Others) 5.Safety and Security Sector Education and Training Authority (SASSETA) 6.Auditor General and National Treasury 7.Consumers of private security services 51 KEY STAKEHOLDERS

55. AUTHORITY’S STRATEGIC OBJECTIVES 52

56. *To increase operating revenue by: -Collecting ninety five percent of PSIRA’s outstanding and the full recoverable debt - Collecting ninety percent of PSIRA’s fees due, on time *To obtain funding for specific identified projects (e.g. re- registration) and/ or identified capital expenditure * To grow services as per our legal mandate which includes law enforcement of all categories or classes of security service providers *To comply with the requirements of the PFMA and receive an unqualified audit report. 53 STRATEGIC OBJECTIVES

57. *To facilitate the establishment of an ombudsman’s office for the Private Security Industry *To develop and implement an enabling internal IT architecture that allows for effective registration, record keeping and document management, fast and accurate access of information and informs effective decision making, efficient work processes and collaborative communication 54 STRATEGIC OBJECTIVES(…cont’d)

58. *To reduce the time taken to register security officers and security businesses to no more then seven working days *To develop an appropriate environment to facilitate enforcement and stakeholder access, within which stakeholders requiring assistance are served effectively and efficiently (national footprint) *To ensure that the right people are in the right place at the right time to execute the PSIRA strategy *To drive quality and operational efficiency and effectiveness through disciplined, efficient processes and ongoing measurement, evaluation and improvement *To maintain and enhance effective corporate governance in PSIRA (PFMA, King 3 Report and others) *To develop an appropriate enabling environment for PSIRA through the review and amendment of all applicable legislation and regulations 55 STRATEGIC OBJECTIVES (…cont’d)

59. *To shape the PSIRA organisational culture over time to best execute the strategy *To implement an effective Performance Management Programme *To develop a high engagement working environment within PSIRA *To develop an environment conducive to long term success *To align the Authority’s staff, systems and organisational design behind the PSIRA strategy *To build the effective leaders / managers required to drive PSIRA’s strategic and operational success 56 STRATEGIC OBJECTIVES (…cont’d)

60. THANK YOU Private Security Industry Regulatory Authority 481 Belvedere Street Arcadia Pretoria, 0001 Tel No. 012 – 3375500 Website:www.psira.co.za 57