The Department of International Relations and Cooperation (DIRCO)’s property portfolio has deteriorated to the point where diplomats can no longer live or work in it.
An analysis presented to the Portfolio Committee on International Relations on Wednesday made this finding, stating that “several properties have become unsuitable for occupation and are no longer in a habitable condition for officials”.
“For the first time, the Auditor General has identified material irregularities during the audit of the department. The finding of oversight concern is that immovable properties in some areas in South Africa’s missions abroad are not maintained,” it reads.
PFMA non-compliance and mismanaged assets
The Auditor-General found that Dirco had not complied with provisions of the Public Finance Management Act (PFMA), and the Government Immovable Asset Management Act (GIAMA) requiring the department to properly manage and maintain its assets.
The PFMA requires the accounting officer of a department to manage, safeguard and maintain its assets, while GIAMA requires state-owned properties in use to remain operational and capable of supporting service delivery.
“This non-compliance has resulted in, and is likely to continue resulting in, the ineffective utilisation of state-owned immovable assets, as several properties remain vacant or underutilised due to their deteriorated condition,” according to the analysis.
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The analysis warns that allowing the deterioration to continue could further reduce the value of the properties and limit their usefulness to South Africa’s diplomatic operations.
Double the cost: renting overseas
At the same time, officials transferred to missions abroad may have to be accommodated in rented properties when government-owned residences are no longer suitable. In effect, the state can end up carrying the cost of an empty government property while also paying for alternative accommodation for the official who would ordinarily have occupied it.
It also cautioned that the condition of South Africa’s buildings abroad has implications for the country’s image and has called for a properly funded property management approach.
The parliamentary analysis says the slow progress in dealing with renovations and acquiring properties may require the committee to investigate why the department has not delivered the expected results under its existing strategy.
The committee is considering more focused physical oversight visits to missions where the problems have been identified. It also plans to monitor whether DIRCO’s property strategy is being implemented effectively and whether it is producing measurable improvements.
DIRCO has told Parliament that it needs more than R300 million every year to keep its properties abroad in good condition. The disclosure came on Tuesday, a day before Parliament’s Standing Committee on Appropriations.
DIRCO is responsible for 174 state-owned properties across its foreign missions, while another 666 buildings used by South African missions are rented.
The state-owned portfolio, which DIRCO told Parliament is worth more than R5 billion, includes diplomatic chancelleries, official residences and accommodation for staff. But roughly three in every 10 of its overseas properties were in poor condition, while fewer than a third were rated as being in good condition.
DIRCO attributed the problem in part to a long-standing shortage of money and personnel.
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Parliament demands accountability, oversight
The department explained that it inherited responsibility for the overseas government property portfolio from the Department of Public Works in 1999 without receiving a dedicated budget or the staffing capacity needed to manage the assets.
It now has only seven officials responsible for managing the portfolio spread across more than 100 countries.
The department also pointed to the age of some buildings and the additional requirements attached to heritage properties, particularly in Europe, as factors that make maintenance more expensive and complicated.
- The Department of International Relations and Cooperation's (DIRCO) property portfolio has deteriorated, leaving several foreign mission properties unsuitable for occupation.
- The Auditor-General identified material irregularities for the first time, noting DIRCO's non-compliance with the Public Finance Management Act (PFMA) and Government Immovable Asset Management Act (GIAMA).
- DIRCO manages 174 state-owned properties abroad worth over R5 billion, with about 30% in poor condition and fewer than 30% rated as good.
- The department lacks sufficient staff, with only seven officials managing properties across more than 100 countries, and cites budget shortages and maintenance challenges for heritage buildings.
- DIRCO requires over R300 million annually to maintain its overseas properties and faces potential costs for renting alternative accommodations when owned properties become unusable.
