1. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development Independent Communications Authority of South Africa Amendment Bill, 2013 & Electronic Communications Amendment Bill, 2013 Department of Communications Presentation to Select Committee on Labour and Public Enterprises 05 February 2014 1

2. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development Delegation  Rosey Sekese: Director - General  Themba Phiri: Deputy Director – General  Collin Mashile: Chief Director  Alf Wiltz: Director  Lerato Molete: Director  Ephraim Adom : Director  Khayalethu Rutsha : Senior Administration Officer 2

3. Background  The Department was invited to present the Electronic Communications Amendment Bill, 2013 and the Independent Communications Authority of South Africa Amendment Bill, 2013 to the Select Committee on Labour and Public Enterprises on 22 and 29 January 2014  During the deliberations of 29 January 2014, the honourable Committee requested the Department to consider two matters in the Independent Communications Authority of South Africa Amendment Bill, 2013 further Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 3

4. Background  The two relevant clauses in the Bill are –  clause 9(b) (section 11(3)) regarding the quorum of the Council; and  clause 18 (amendment of section 15(4)) regarding co-signature of cheques Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 4

5. Section 11(3): Quorum  The honourable Committee has directed the Department to consider the appropriateness of section 11(3) (clause 9(b) of the Bill).  Clause 9(b) provides as follows: ‘‘11(3) The quorum for any meeting of the Council is a majority of the councillors in office at the time, including the chairperson or an acting chairperson who is a councillor and appointed by the chairperson to perform the functions of the chairperson, which functions include the power to preside at a meeting in the absence of the chairperson; and” Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 5

6. Section 11(3): Quorum  The Department has identified the following Acts that have similar provisions:  NATIONAL ENVIRONMENTAL MANAGEMENT: BIODIVERSITY ACT NO. 10 OF 2004 25. Quorum and decisions.—(1) A majority of the members of the Board serving at any relevant time constitutes a quorum for a meeting of the Board. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 6

7. Section 11(3): Quorum  LOCAL GOVERNMENT: MUNICIPAL PROPERTY RATES ACT NO. 6 OF 2004 68. Quorums and decisions.—(1) A majority of the members of an appeal board serving at any relevant time constitutes a quorum for a meeting of the board.  HIGHER EDUCATION ACT NO. 101 OF 1997 Nelson Mandela Metropolitan University: Statute 17. Meetings of council.— (2) One half plus one of the members of the council holding office on the date of the meeting of the council constitutes a quorum for such meeting. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 7

8. Section 11(3): Quorum  Institutional Statute: Cape Peninsula University of Technology (Government Gazette No. 33202) 26. Procedure at meetings of council.—(1) The quorum of a meeting consists of 50% plus 1 of the members holding office. Where a fraction arises it is rounded off to the next whole number.  PRIVATE SECURITY INDUSTRY REGULATION ACT NO. 56 OF 2001 12. (3) The quorum for any meeting of the Council is a simple majority of the councillors in office at the time. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 8

9. Section 11(3): Quorum  SOUTH AFRICAN POSTBANK LIMITED ACT NO. 9 OF 2010 17. Procedures at meetings, and committees of Board.—(1) (b) Seventy percent of serving members constitutes a quorum at any meeting of the Board.  SOUTH AFRICAN POST OFFICE SOC LTD ACT NO. 22 OF 2011 14. Procedures at meetings, and committees of Board.—(1) (b) Seventy per cent of serving members constitutes a quorum at any meeting of the Board. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 9

10. Recommendation The Department recommends that clause 9(b) of the Bill be retained since the drafting is in line with generally accepted practice. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 10

11. Section 15(4): Cheques  The honourable Committee has directed the Department to consider whether it is appropriate to refer to ‘another member of staff’ in section 15(4) (clause 18 of the Bill) or whether it would be more appropriate to include the designation of a specific staff member of ICASA. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 11

12. Section 15(4): Cheques  PFMA: 38. General responsibilities of accounting officers.—(1) The accounting officer for a department, trading entity or constitutional institution— (a)must ensure that department, trading entity or constitutional institution has and maintains— (i) effective, efficient and transparent systems of financial and risk management and internal control; Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 12

13. Section 15(4): Cheques  Treasury Regulations: 8.1 Responsibility of the accounting officer 8.1.1 The accounting officer of an institution must ensure that internal procedures and internal control measures are in place for payment approval and processing. These internal controls should provide reasonable assurance that all expenditure is necessary, appropriate, paid promptly and is adequately recorded and reported. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 13

14. Section 15(4): Cheques  15.12 Warrant vouchers, cheques and electronic payments 15.12.1 Accounting officers of departments must assign authority in writing to officials to approve warrant vouchers, cheques or electronic payments. 15.12.2 Only authorised officials may sign hand- drawn vouchers or cheques and must initial the counterfoils. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 14

15. Section 15(4): Cheques  ICASA Amendment Bill: 15(2) The chief executive officer contemplated in section 14(1) (a) is, in accordance with section 36 of the Public Finance Management Act, 1999 (Act No. 1 of 1999), the accounting officer of the Authority and charged with the responsibilities referred to in that Act which include, amongst others, responsibilities regarding auditing, financial control, budgetary control and reporting, Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 15

16. Section 15(4): Cheques  ICASA Amendment Bill: 15(4) Cheques drawn by the Authority must be regarded to have been duly issued and signed on its behalf if issued under the joint signatures of the accounting officer and another member of the staff, or a councillor, of the Authority designated by the Council. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 16

17. Section 15(4): Cheques  The basic premise is therefore that the CEO as the accounting officer is responsible for financial management and it follows that he/she is responsible for signing cheques. The ICASA Act has an additional safeguard in section 15(4) that provides that another member of staff should co- sign as well. The provisions in the Act are therefore strengthening the accountability required under the PFMA even further. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 17

18. Section 15(4): Cheques  The matter under consideration does not form part of the amendments being proposed in the Bill. The reference in section 15(4) to ‘another member of staff’ is an existing provision in the ICASA Act. If an amendment is considered, care should be taken of any unintended consequences, especially since no consultation with stakeholders was performed on it. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 18

19. Section 15(4): Cheques  It may cause difficulties if the word ‘staff’ is substituted with the designation of a specific staff member such as the CFO, the reason being that assigning this responsibility to a specific portfolio can be too restrictive and counterproductive in case that specific post is vacant or the assigned official is absent from work over an extended period of time. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 19

20. Section 15(4): Cheques  It is also necessary to allow some flexibility since the Council may require signature by staff at different levels of seniority up to councillor level depending on the amount of the cheque.  If restructuring takes place at ICASA and the specified title/portfolio is no longer applicable in its structure, the Act will have to be amended again. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 20

21. Section 15(4): Cheques  Lastly, the existing wording is aligned with the spirit of Treasury Regulation 15.12 that provides that the Accounting Officer must assign authority to officials to approve cheques, without specifying the titles of such officials upfront. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 21

22. Recommendation  The Department recommends that the existing wording in section 15(4) of the Act that refers to ‘the accounting officer and another member of staff’, should be retained. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development 22

23. Making South Africa a Global Leader in Harnessing ICTs for Socio-economic Development THANK YOU 23