Border Management Authority (BMA) FY2025 Budget Presentation: Securing Borders for Development
Presenting the Border Management Authority's (BMA) vision, mission, and value proposition for FY2025 budget allocation, focusing on secure borders for development. The establishment of BMA as a Section 3A public entity is outlined, along with the purpose of ensuring legitimate movement of goods and persons, coordination with other entities, and contribution to national security and socio-economic development. Background information on BMA's inception and Cabinet mandate is also provided.
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PRESENTATION BMABUDGET FY2025 27 February 2024 Secure Borders for Development
PRESENTATIONOVERVIEW 8 7 FY2025 Allocation BMA Funding Challenges 6 FY2024 Actuals 5 4 Estimated Allocation MTEF 3 Background 2 Vision Mission Statement Establishment of BMA 1 Purpose Secure Borders for Development 2
PURPOSEOF THE PRESENTATION To brief the Portfolio committee on Home Affairs on the Border Management Authority (BMA) Annual financial performance and the budget for FY2025 Secure Borders for Development 3
BMA VISION, MISSION & VALUE PROPOSITION: A world class integrated border law enforcement Authority partnering for a safe and prosperous South Africa. VISION To be a credible provider of highly efficient, integrated, well-coordinated and technology driven border law enforcement services that contribute to national security and socio-economic development by inculcating an ethical culture that empowers teams for service excellence. MISSION A world-class coordinated and integrated Border management platform with a Single Command and Control, that supports Secure Borders, Safe Travel, and Trade Facilitation, which promotes Socio-economic Development. VALUE PROPOSITION Secure Borders for Development 4
ESTABLISHMENTOF BMA The Border Management Authority (BMA is established as a Section 3A public entity in accordance with the Public Finance Management Act (PFMA), 1999, charged with the responsibility of ensuring: Facilitate and manage the legitimate movement of persons within the border law enforcement area and at ports of entry; Facilitate and manage the legitimate movement of goods within the border law enforcement area and at ports of entry; Co-operate and co-ordinate its border law enforcement function with other organ of state, border communities or any other persons. Section 4 (1) of the BMA Act, 2 of 2020, establishes BMA as a Public entity outside Public Service and assigned it as an armed service, in terms of Section 199(3) of the Constitution. Secure Borders for Development 5
BACKGROUND In June 2013, Cabinet mandated the Department of Home Affairs (DHA) to lead the establishment of a Border Management Authority in South Africa, which will be responsible for the execution of border law enforcement functions that were then performed by multiple stakeholders. The establishment of the BMA was to enable a legal framework that will allow the authority to execute functions on behalf of a multiplicity of Organs of State in the Ports of Entry and within the border law enforcement area. In July 2020, the President assented to the Border Management Authority (BMA) Act, 2020 into law. Subsequent to the passing of the legislation, border law enforcement functions were transferred to the Minister of Home Affairs through a Presidential Proclamation. To this end, the BMA was formally established as an independent National Public Entity in terms of Schedule 3A of the Public Finance Management Act (PFMA), 1999 on 1 April 2023. The BMA was established on 1st April 2023 and officially launched as the third armed service in South Africa by the President on 5th October 2023. To this effect the BMA is funded through the budget transfers from transferring Departments (DFFE; DALRRD; DHA and DoH) which had their staff members integrated into BMA. The transferred budget comprised over 90% of CoE leaving an immaterial budget for the funding of specialised capital equipment. In response to the envisaged deficit from the monies received through the transfer, BMA applied to National Treasury for an allocation of R2,9bn in FY2024 and was only approved an allocation of R250mil over the MTEF period . This approved allocation of R250mil is less than 10% of the requested allocation. Secure Borders for Development 6
ESTIMATED ALLOCATION FOR MTEF PERIOD The graph depict the allocation provided to the BMA over the MTEF period. R'000 1600 000 In FY2024; the year of the establishment of the BMA; the Authority was approved an allocation of R1,34bn of which 72% (R963mil) relates to Compensation of employee (CoE) and the remaining balance of R377mil (28%) reserved for goods and services (G&S). 1540 566 1550 000 1500 000 1473 078 1450 000 1407 692 1400 000 The focus for the Authority in FY2024; was to ensure the efficient transfer of employees Departments into the BMA; whilst ensuring that adequate tools of trade are provided to enable the service delivery in accordance with the BMA mandate. 1341 226 1350 000 from transferring 1300 000 1250 000 1200 000 FY2024 FY2025 FY2026 FY2027 The adequate funding of the mandate remains a significant concern and risk for the Authority; as the entity struggles to capacity through attract and retaining experienced and skilled employee, provide tool of trades and invest in technology. Secure Borders for Development 7
FY2024 ACTUAL SPENDING The following Goods and Services (G&S) expenditure are the top (6) six expenditure incurred in FY2024: Advertising: FY2024 being a year of establishment for the BMA, the Authority spent on branding and advertisement for introducing the entity and also the Presidential launch of the entity which was held in Limpopo. G&S TOP 6 EXPENDITURE 12 203 Advertising Computer Service: This relates to the licensing for transferring employees from the previous Department email address to the BMA address. In addition, the licenses in relation to the financial system purchased by the Authority. Computer services 22 369 Fleet services 60 270 Housing Fleet Management: As part of the asset transfer, accepted the 71 vehicles that were under the G-Fleet contract. The fleet management cost related to the G-Fleet and Wesbank management costs for additional fleet purchased by the entity. 15 800 Inventory: Clothing material and accessories Travel and subsistence 10 272 Housing: The housing costs relate to leased property expenditure such as cleaning contracts; electricity and maintenance of the property. The BMA as part of the transfer took over operating lease agreements from the Department, specifically in the in the area which is occupied by BMA transferred staff. 29 060 Inventory (Uniforms): As a law enforcement entity, the BMA has a branded uniform that is worn by all employees. As part of the establishment of the entity, it was required that all employees be provided with a uniform as part of the tools of trade. To date, BMA has incurred R720mil in CoE; this equates to 75% of the CoE-approved budget in FY2024. Travel and subsistence: These costs mostly relate to costs incurred during the launch of the BMA and the festive operational plan. Secure Borders for Development 8
FY2025 ALLOCATION The graph depicts the allocation for the BMA over the MTEF period. BMA has been exempted from the budget costs announced by the National Treasury in FY2024. In FY2024/25, the BMA will be receiving R1,407bn from the fiscus. The allocation is budgeted that 86% (R1,2bn) will be utilized for CoE. The CoE budget is earmarked to be used for: R'000 The recruitment of critical positions within the Corporate Service (CS) Unit. The CS unit is currently manned by 31 (1.4%) which supports 2115 operation staff. BMA will also be filling senior operational positions at the Port of Entries. These critical positions include the Regional and Port commanders, these positions are vital to provide leadership and stability within the Port of Entries. 1600 000 1540 566 1550 000 1500 000 1473 078 The remaining balance of R194,8mil (14%) for the FY2024/25 budget will be used for Goods and Services (G&S). This budget will fund the spending on the following: 1450 000 1407 692 1400 000 Fleet management: for the repairs; maintenance and fueling of the BMA fleet which is vital in intercepting and deterring any form of criminality with the Port of Entries. Operating leases across the four (4) regions: BMA is in the process of consolidating transferred staff within each Region into one office space. This will assist with effective communication and cost savings. Software licenses: BMA to increase the Microsoft and SAGE ERP licenses with the expected increase in the staff compliment. Capital expenditure: Furniture and fitting for the Port Entries which have redundant old assets. Investment in ICT infrastructure (i.e. computers) as most of the transferred ICT assets are obsolete and have outdated software which is not supported. 1350 000 1300 000 FY2025 FY2026 FY2027 Secure Borders for Development 9
BMA FUNDING CHALLENGES The BMA remains appreciative to the NT for the exemption received against the budget cuts; and is mindful of the prevailing economic situation the country faces and therefore recognises the absolute necessity for cost containment as well as stringent budget management, as such has developed its cost containment measures aligned with the cost containment guidelines issued by NT. However, even with the cost containment measures implemented; BMA recognises the shortfall in the funding provided to the entity. This shortfall has a significant impact on the ability of the entity to render its mandate. The following funding challenges are brought to the attention of the Portfolio Committee: The approval of only R250mil from the R2,9bn requested compromises in the Authority in that it is unable to adequately invest in the tools of trade and technologies for the operations staff to enable them to efficiently facilitate the movement of people and goods, as well as effectively intercept the illicit flow of goods and illegal movement of people through our ports and vulnerable segments of the borderlines. These tools of trade include but are not limited to; patrol vehicles, firearms and ammunition, communication devices, uniforms, body armour, body-worn cameras, surveillance equipment, forensic technology, etc. The transferred operations from the transferring Departments come with four different networks, that do not interface, this necessitates for BMA to establish its own network at the Port of Entries. The lack of funding affects this critical project which is the baseline/foundation for the BMA Operations. The lack of a BMA network will result in inaccessibility thus the operations staff will be unable to efficiently facilitate the movement of people and goods, as well as effectively intercept the illicit flow of goods and illegal movement of people through our ports and vulnerable segments of the borderlines. This results in South Africa being susceptible to acts of corruption and criminal activities through the movement in our Port of Entries. Security at our land Port of Entries remains a significant concern with limited surveillance ICT infrastructure. In FY2025, 11 Port of Entries are earmarked for the installation of high-definition surveillance cameras with facial recognition and artificial intelligence capabilities. With appropriate funding the BMA could afford to implement this critical project across its 71 Port of Entries. The risk of the non-installation of the surveillance ICT equipment will exacerbate cross-border criminal activities, including human trafficking, smuggling of arms, and counterfeit goods, which compromise national security and economic development. Secure Borders for Development 10
BMA FUNDING CHALLENGES The Port of entry infrastructure taken in aggregate, is unsatisfactory and generally at risk of failing to serve its purpose. BMA need funding to be able repair and maintain the Port of Entries (PoE). The continuous no investment in the Port infrastructure negatively impacts on the ability of the Authority to deliver on the mandate specifically on the South African Borders that have been denounced as porous. Further the poorly maintained facilities risk large ports failing to meet prescribed standards imposed by international regulatory authorities. In conclusion, the BMA as a public entity, understands the financial pressures of the fiscus and supports the cost containment guidelines as issued by the National Treasury. However, if the BMA is not adequately funded, this will compromise the establishment and stabilization of the newly established Authority that has been tasked with a critical mandate which is to ensure the security of South Africa through facilitating and managing the legitimate movement of persons and goods within the border law enforcement area and at ports of entry. The BMA requested that the Portfolio Committee note with concerns, the risks raised by the Authority on the inadequate funding of the entity and requests the Committee to assist in advocating for more funding to be provided to the entity so that it can efficiently and effectively execute its mandate. Secure Borders for Development 11
THANK YOU Secure Borders for Development 12
