Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1698926416821.pdf (South Africa)
Tuesday, 10 May 2022] No 67—2022] FOURTH SESSION, SIXTH PARLIAMENT PARLIAMENT OF THE REPUBLIC OF SOUTH AFRICA _____________________ ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS _____________________ TUESDAY, 10 MAY 2022 _____________________ TABLE OF CONTENTS COMMITTEE REPORTS National Assembly 1.

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Cooperative Governance and Traditional Affairs ............................................................ 2 Finance ........................................................................................................................... 16 Agriculture, Land Reform and Rural Development ....................................................... 44 Agriculture, Land Reform and Rural Development ....................................................... 76 Sport, Arts and Culture ................................................................................................... 88 Higher Education, Science and Innovation .................................................................. 108 COMMITTEE REPORTS National Assembly 1 1.
REPORT OF THE PORTFOLIO COMMITTEE ON COOPERATIVE GOVERNANCE AND TRADITIONAL AFFAIRS ON THE 2022/23 ANNUAL PERFORMANCE PLANS AND BUDGETS OF THE DEPARTMENTS OF COOPERATIVE GOVERNANCE AND TRADITIONAL AFFAIRS AND THE ENTITIES REPORTING TO THEM, DATED 10 MAY 2022 Having met with the Departments of Cooperative Governance and Traditional Affairs, and their associated entities, on their 2022/23 Annual Performance Plans (APPs), Strategic Plans and Budgets, the Portfolio Committee on Cooperative Governance and Traditional Affairs reports as follows: 1.
INTRODUCTION 1.1.

Section 77 (3) of the Constitution stipulates that an Act of Parliament must provide for a procedure to amend money Bills before Parliament.

This Constitutional provision resulted in Parliament passing the Money Bills Amendment Procedure and Related Matters (Act No.

9 of 2009) (the Money Bills Act).

The Money Bills Act sets out the process that allows Parliament to make recommendations to the Minister of Finance to approve, reject or amend the budget of a National Department.

1.2.
1.2.

From 03 - 04 May 2022, the Portfolio Committee met and considered the 2022/23 Annual Performance Plans, Strategic Plans and Budgets of the Departments and Entities reporting to it.

These consist of the Departments of Cooperative Governance and Traditional Affairs, the Municipal Infrastructure Support Agent, the CRL Rights Commission, the Municipal Demarcation Board and the South African Local Government Association.

2.

KEY POLICY AND RESOURCE ALLOCATION CONSIDERATIONS FOR 2022/23 2.1.
Department of Cooperative Governance.

2.1.1.

A key matter of concern in the 2022/23 APP of the Department of Cooperative Governance relates to the tabling in Parliament of the Monitoring, Support and Interventions Management Bill.

The Committee has, on numerous occasions, heard of the abuse and misuse of the intervention process, particularly by Provincial Governments, due to the lack of a legislative instrument that clarified and regulated it.

The Bill is therefore needed as a matter of urgency.
2.1.2.

However, the Department keeps shifting the goal posts for the submission of the Bill to Parliament.

During the 2021/22 APP process, the Department stated that the Bill would be tabled by 31 March 2022.

In the meeting of 22 March 2022, where the Portfolio Committee considered the Department’s 1 2 financial and non-financial performance in relation to the Third Quarter of 2021/22, the Committee was promised that the tabling of the Bill could be expected in July 2022.

2.1.3.
2.1.3.

The 2022/23 APP now shifts the deadline again to 31 March 2023.

Since this Bill has been on the Department’s APP since the Fourth Parliament, the concern is that the Department may shift the tabling of this Bill perpetually, thus making a mockery of the parliamentary accountability process.

2.1.4.
2.1.4.

As in many previous years, the Portfolio Committee remains concerned (see section 4.1) that the Community Work Programme does not seem to be serving its intended purpose, and its investment return does not justify the large sums of money allocated to it.

In 2022/23, this allocation amounts to R4.3bn.


As the Table below indicates, the allocation to the CWP constitutes 85,1 percent of the funds directly administered by the Department, excluding transfers to municipalities, the South African Local Government Association, the Municipal Demarcation Board, the Municipal Infrastructure Support Agent, and the South African Cities Network.

Source: Department of Cooperative Governance (2022).

2 3 2.2.

Municipal Infrastructure Support Agent 2.2.1.


For the most part, the entity’s 2022/23 APP is similar to the APP presented in 2021/22 except for a noticeable increase in output targets for Programme 3: Infrastructure Delivery Management Support.

These have increased from seven in 2020/21 to 11 in 2022/23, following the addition of new responsibilities.

2.2.2.
2.2.2.

During the 2021/22 Budget Vote process, the Portfolio Committee noted that the funding model of the MISA was not optimal, given the responsibilities which the organisation is expected to fulfil.

This observation followed a recommendation issued by the Committee in its 2020/21 Preliminary Budgetary Review and Recommendations Report, which stated that MISA must re-examine its funding model to ensure that it is aligned to the responsibilities expected of the organisation.

2.2.3.
2.2.3.

In response to the Portfolio Committee’s observations and recommendations, MISA indicated that it had prepared a business case, including full costing, setting out the key initiatives aimed at strengthening the agency’s role and capacity to support struggling municipalities towards improved delivery of municipal infrastructure and basic services.

This business case was approved by the Minister in September 2019 and submitted to National Treasury as the basis for seeking additional funding.

2.2.4.
2.2.4.

The estimated amount requested based on the business case was R2.9 bn over the three-year MTEF period.

National Treasury did not approve the request for funding to implement the initiatives in the business case.

MISA has since initiated a process of developing a Long-Term strategy that seeks to clearly define its key focus areas, operational approach and funding model in the future.
It is envisaged that the strategy will pave a way for further exploration of various options for funding MISA in the future.

The appointment of a service provider to assist the agency in the development of this strategy was envisaged to be concluded by the end of February 2022.

2.2.5.

Thus, as the Table below illustrates, the funding allocation to MISA still falls far below the R2.9bn needed to strengthen the agency’s role and capacity to fulfil its mandate.
3 4 Source: Municipal Infrastructure Support Agent (2022).

2.3.

Department of Traditional Affairs.

2.3.1.

As in the previous financial year, the Department’s 2022/23 APP reiterates emphasis on the role of the institution of traditional leadership in terms of fighting Gender Based Violence and Femicide.

The Department continues envisaging using structures of traditional leadership to create awareness of GBVF in traditional communities.

2.3.2.
2.3.2.

However, some traditional leaders are concerned that government seemed intent on conferring this role and responsibility without any attempt to create an enabling environment for its execution.

Consequently, the Department is likely to receive limited cooperation in this regard, unless it ensures that traditional leaders are adequately resourced to execute the policy directives of government.
The Department has previously informed the Portfolio Committee that this is the responsibility of the Province.

However, the Committee did not find this argument convincing, as it was the national Department’s responsibility to oversee the Province, and see to it that it was fulfilling its mandate.

2.3.3.

Previously, the Portfolio Committee has submitted that the funding allocation to the CRL Rights Commission is pitiful considering the magnitude of the Commission’s mandate, and needs urgent review.
It was noted that there was no proper investment in the structure supposed to address the 4 5 country’s deep-seated problems of racism, which inevitably related to culture, language and religion.

In the same Report, the Committee further noted that the funding allocated to the National House of Traditional Leaders falls short of the goal of reaffirming the role of the institution of traditional leadership as a key player in cooperative government.

2.3.4.
2.3.4.

Both the CRL Rights Commission and the National House of Traditional Leaders receive their budget allocations as transfers from the Department of Traditional Affairs.

Increasing funding to these institutions would entail augmenting the DTA’s baseline.

However, as indicated in Table below, the Department’s budget allocation of R177m in 2022/23 is itself constrained, and does not provide much room for augmenting the funding to the two institutions.

Source: Department of Traditional Affairs (2022).


2.4.

Municipal Demarcation Board 2.4.1.

Over the years, the Portfolio Committee has been emphasizing the need for the Board to improve on its public awareness and stakeholder education process.

In response, the Board has repeatedly expressed its commitment to address this matter.
Even in the 2022/23 APP the Board raises the lack of 5 6 understanding of the municipal boundary red-determination process as a matter of concern, and affirms its intention to continue with its education and awareness programme.

2.4.2.

It is therefore of concern that the 2022/23 APP drastically reduces the number of public awareness and education activities completed, from 10 in 2020/21 to only four in 2022/23.
This is inconsistent with the Board’s expressed commitment to improve on its public awareness and stakeholder education process.

2.4.3.

As in the previous financial years, the Board continues to express frustration with regard to the limited financial resources allocated to it, which constrains its ability to fulfil its mandate.

Specific mention is made of the imperative to conduct municipal boundary re-determination that will require significant funding in 2022/23.
Previously, the Portfolio Committee noted that the Board’s projected budget reduction over the medium is a concern, as it has negative implications for the Board’s operational stability, especially in relation to public participation.

At the same time, there is a concern (see section 4.6) the that compensation of employees consumes an excessive portion of the entity’s allocated budget, as seen in Table below.

Source: Municipal Demarcation Board (2022).

6 7 2.5.
6 7 2.5.

South African Local Government Association 2.5.1.

The South African Local Government Association has just emerged from its elective conference of 2022, which ushered in a new Five-Year Strategic Framework that, among other things, outlines the strategies, which the organisation will be pursuing over the next five years.
Among the envisaged strategies will be a movement towards a focus on the impact of the organisation’s work, as to address the concern around the fact SALGA has been obtaining consecutive clean audits for nearly a decade, but this has not been translating to its member municipalities.

2.5.2.
2.5.2.

It is also worth noting that while the Constitution, the Municipal Systems Act, the Intergovernmental Relations Framework Act and the White Paper on Local Government provide a clear role for SALGA, the Municipal Finance Management Act omits to do so despite being one of the key legislative prescripts governing the financial affairs of local government for which SALGA has a central stake.
The lack of a legislated function for SALGA in regulating the financial affairs of municipalities is a missed opportunity in terms of enhancing oversight over municipal financial reporting obligations.

2.5.3.
2.5.3.

One of the findings emerging from the Portfolio Committee’s recent oversight visit to the Free State province was that many of the municipalities in the visited Districts of Lejweleputswa, Thabo Mofutsanyana and Fezile Dabi had woeful revenue collection rates and had little to non-existent revenue enhancement strategies.

One would have expected that SALGA’s Municipal Financial Support sub-programme would have a plan of action around this matter.

2.5.4.
2.5.4.

SALGA has submitted that, for the 2022/23 financial year, it will have a shortfall of R112.5m as the national fiscus is not funding its legislated participation in Intergovernmental Relations (IGR) and mandatory governance costs.

However, as in the case of the MDB, there is a concern that, were SALGA provided this shortfall, it would be consumed by administrative overheads (see section 4.6).
As seen in Table below, 66.7 percent of the organisation’s anticipated expenditure in 2022/23 is geared towards administration.

7 8 Source: South African Local Government Association (2022).

2.6.

CRL Rights Commission 2.6.1.

As noted under section 2.3.3, the Portfolio Committee has previously submitted that the funding allocation to the CRL Rights Commission was incommensurate with the magnitude of the Commission’s mandate, and needed urgent intervention.
There was a need to ensure that Government invests adequately in the structure supposed to address the country’s deep-seated problems of racism, which inevitably related to culture, language and religion.

2.6.2.

However, there is also a concern (see section 4.6) that R30.5m of the Commission’s R47m budget allocation is earmarked for internal administrative overheads, as seen in Table below.
This means that approximately 65 percent of the Commission’s budget is geared towards payment of organisational overheads, rather than service delivery deliverables.

This needs to be interrogated, otherwise the Commission risks existing primarily for the payment of salaries and other overheads.

8 9 Source: CRL Rights Commission (2022).

2.6.3.


As in the previous years (going as far back as the Third Administration), the Commission continues to decry inadequate funding, which reportedly hinders it from deploying all the resources necessary to enable it to deliver on its mandate.

At the same time, the Commission has no clear resource mobilisation strategy.
Previously, the Commission had indicated to the Portfolio Committee that it had a draft resource mobilisation strategy, but this had not yet been finalised.

An update on this draft strategy is now overdue.

3.
3.

IMPLEMENTATION OF 2021/22 BUDGETARY REVIEW RECOMMENDATIONS 2021/22 BRR PROGRESS IN 2022/23 RECOMMENDATIONS 3.1 The Committee must demand a clear plan and timeframes from the Department of Cooperative Governance with The Department introduced a new CWP Implementation Policy with effect from 01 October 2021.

The policy clarifies the role of Implementing Agents and significantly strengthens procurement and financial practices.
The policy is currently being updated to incorporate learnings form the first 6 months of implementation.

9 10 2021/22 BRR PROGRESS IN 2022/23 RECOMMENDATIONS regard to resolving the legacy issues in the Community Work Programme.

This will enable the Committee to deal with specifics, rather in than general terms.

talk 3.2 The Committee must the of engage Department Cooperative Governance on developing a clear plan that responds to the issue of unreliable and water supply sanitation.
This should be a broad plan that also responds to roads maintenance.

3.3 The Department must, as a matter of urgency, finalise and table to the Bill Parliament to relating intergovernmental interventions in terms of Sections 100 and 139 the of Constitution.

The Department is currently finalising the CWP Policy Framework to ensure that the new CWP model will have a greater impact on poor communities.

This process is expected to be completed by end March 2022.
The new model will ensure that useful work is designed to support key priorities as identified in DDM One Plans and ensure that targeted training support real skills development that would enable participants to become self-employed or find more sustainable income opportunities.

The framework introduces a shift in focus from Implementing Agents to Implementing Partners, based on shared goals aims at improved public goods and services.
The Department presented the above progress to Portfolio Committee on 01 February 2022.

Ongoing.

The report detailing plans to respond to unreliable water supply and sanitation has been developed and will be shared with the Portfolio Committee and further discussed upon receipt of invitation from the Committee.

The report detailing plans was attached as Tag A – from page 26 - 35 Ongoing.
i) The Department has concluded on the consultations undertaken with all national sector departments, provincial treasuries, Premiers Offices, NW Section 100 Administrators’ Forum, MuniMECs/TROIKAs and office- bearers in all nine provinces, and National Economic Development and Labour Council (NEDLAC) was also engaged.

ii)The Bill has been submitted to Department of Planning Monitoring and Evaluation (DPME) to obtain the obligatory “socio-economic impact assessment,” certificate.
Feedback was received from DPME and the 10 11 2021/22 BRR PROGRESS IN 2022/23 RECOMMENDATIONS revised “socio-economic impact assessment and draft plan has been resubmitted to DPME in December 2021. iii)The Bill was also submitted to Office of the State Law Advisor to obtain a Cabinet Compulsory State Law Advisor’s constitutional compliance certificate.

Feedback was received from the State Law Advisor (SLA) during an engagement held on 02 December 2021.
The revised IMSI Bill has been resubmitted to SLA in December 2021.

A pre- certification note has been obtained from the SLA.

iv)Next step is to present the Bill to the Cabinet clusters for inputs and comments before processing it further v)Based on the Department’s Annual Performance Plan for 2022/2023 financial year the Bill will be tabled in Parliament by 31 March 2023.

Ongoing.

The Department takes charges levelled against the Chief Executive Officer of MISA very seriously.
Without prejudicing the merits of the case, the Hawks provided information as follows.

Herewith updated progress: Cambridge Cas 260/06/2018 – Fraud & Corruption Prejudice: +/- R 631 MILLION Accused: 1.

Ntsokolo Chris Magwangqana 2.

Vincent Mpumelelo Shezi 3.

Nkosinathi Rooseveld Soga 4.

Lulama Lancelot Taleni 5.

Goodman Ntandazo Vimba 6.

Ongama Mahlawe 7.


Bongani Mpeluza 11 of of brief 3.4 The Minister Cooperative Governance and Traditional Affairs the should Committee in relation to the charges against the Chief Executive the Officer Municipal Infrastructure Support Agent in connection with the supply of Ventilated Improved Latrines the Amathole District.

In its next audit, the Office of the Auditor- General should also look into this matter.

in 12 2021/22 BRR PROGRESS IN 2022/23 RECOMMENDATIONS 8.
Eddison Vuyani Gaga 9.

Helen Busisiwe Kwinana- Boadi 10.

Lovemore Sinbara Kativhu CURRENT STATUS OF INVESTIGATION Investigation complete INVESTIGATION CONDUCTED SINCE THE LAST REPORT Case was transferred to Grahamstown High Court and postponed to the 04 April 2022 for the observation of accused 02 to appear and outcome of observation whether accused 2 will be fit to stand trial.

The case for the rest of the accused persons is postponed to 03 May 2022.

Recommendation implemented.


The Portfolio Committee had engagement with the MDB and COGTA on 7 December 2021.

The Department provided the Committee with an update on this matter.

As a way forward, the Minister recommended to the President to establish an Investigation Tribunal in accordance with the Municipal Demarcation Act.

This is an ongoing process, and we will apprise the Portfolio Committee in due course.
The Board was scheduled to present to the Portfolio Committee a strategy of dealing with demarcation hotspot areas and rationale behind amalgamation of certain municipalities in December 2021.

Due to changes in Committee programme, these could not materialise however 12 3.5 The convene Committee a should separate meeting with the Municipal Demarcation Board to discuss internal its governance matters, including the Report the unfounded on allegations against the Chief Executive Officer.
The Minister and Deputy Ministers Cooperative of Governance and Traditional Affairs the should and discussion way provide forward.

lead a 3.6 The Municipal Demarcation Board should develop and the present to 13 2021/22 BRR PROGRESS IN 2022/23 RECOMMENDATIONS the report was submitted to the Committee.

A detailed report on the above matter was enclosed as Tag B 1 & Tag B 2.

Committee a strategy dealing with of demarcation hotspot areas, including those areas have that challenges going back as far as 2016.
The Board must also clarify the rationale behind amalgamation of certain municipalities in the Eastern Cape, which has exacerbated the problems these in municipalities.

4 COMMITTEE OBSERVATIONS 4.1 The Portfolio Committee noted that large sums of money (in billions) are being allocated to the CWP, but there seemed to be no tangible return on this investment.
Some CWP participants still do not receive stipends, despite assurance from the Department of Cooperative Governance that it will address this matter.

There are still participants who have no uniforms or sharing a set of uniform with several other people.

Overall, the CWP appears to be money wasted.

There needed to be an evaluation of whether the CWP is serving its purpose, as cursory evidence suggests that the system is abusing people rather than serving them.
4.2 The Committee further observed that the Department of Cooperative Governance’s proposal to build new smart cities is a priority that can best be addressed after adequate focus has been given on providing infrastructure to the previously disadvantaged who still drown in pit toilets, and get eaten by crocodiles while fetching water.

The infrastructural gaps resulting from past racial imbalances needed to be narrowed first before the undertaking of more ambitious projects.
4.3 It was noted that the South African Local Government Association had once again presented a moving account of the problems engulfing local government, as well as clear proposals on how to address these.

However, SALGA’s plan will be difficult to sell in the current municipal environment, which is characterised by poor political leadership, non-understanding of legislation, and councillors who do not fully understand their role and fear the involvement of citizenry in ward committees.
SALGA’s 13 14 proposals are likely to remain on paper if the political leadership does not make them a priority.

The Portfolio Committee needs to determine the exact role it should play in this regard.

4.4 The Portfolio Committee is concerned that the footprint of the CRL Rights Commission in rural communities, particularly in the Western Cape, remains invisible.

The existence of the Commission is still unknown among these communities.
4.5 Committee members advised that the Municipal Demarcation Board should be investing more of its resources on public participation, as many people still do not know about the Board.

There is an outcry among some communities that the Board does not consult them.

To prove that these complaints are unfounded, the Board needs to keep a portfolio of evidence on public participation and provide this when requested.
4.6 Finally, the Committee is concerned that more than half of the allocated budgets of SALGA, MDB and the CRL Rights Commission seem dedicated to the compensation of employees rather than on delivering on the core service delivery mandates of these entities.

This creates the impression that these entities mainly exist to pay salaries.

The entities’ presented budgets also do not provide details regarding expenditure on contracted services.
5 COMMITTEE RECOMMENDATIONS 5.1 The Department of Cooperative Governance must conduct an evaluation and cost-benefit analysis of the Community Work Programme to assess whether it was serving its intended purpose and to determine whether the cost incurred on the Programme is consistent with the benefit derived.
5.2 The South African Local Government Association, the Municipal Demarcation Board, and the CRL Rights Commission must provide addenda to their 2022/23 Annual Performance Plans that will assist the Portfolio Committee to better understand why personnel costs and other administrative overheads absorb more than half of the entities’ budget allocations.
6 APPRECIATION The Committee wishes to thank the Departments of Cooperative Governance and Traditional Affairs, CRL Rights Commission, SALGA, Municipal Demarcation Board, and MISA for their fruitful, cordial and constructive engagements.

The contributions of Committee members, as well as Committee support staff is highly appreciated.

Report to be considered 14 15 2.


REPORT OF THE STANDING COMMITTEE ON FINANCE ON BUDGET VOTE 8: NATIONAL TREASURY, DATED 10 MAY 2022 The Standing Committee on Finance (SCOF/ the Committee), having considered the National Treasury and the South African Revenue Service’s annual performance plans (2022/23), reports as follows: 1.
INTRODUCTION 1.1.The Minister of Finance tabled the annual performance plans of the National Treasury (NT), the South African Revenue Services (SARS) and other entities under the Finance portfolio in line with section 10(1)(c) of the Money Bills Amendment Procedure and Related Matters Act, Act No.

9 of 2009 (Money Bills Act), for consideration and report.
1.2.The Deputy Minister, Dr. David Masondo, and the accounting and senior officials of National Treasury and SARS, through virtual meetings, briefed SCOF on 23 March 2022 and 03 May 2021, respectively.
The Committee further conducted an oversight visit to SASRIA, the Land and Agricultural Bank of South Africa (Land Bank), and the Financial and Fiscal Commission (FFC) on 20, 21 and 22 April 2022, respectively, where it, among other things, received presentations/updates on the annual performance plans of these entities.
1.3.The Committee also met all the entities with negative audit outcomes on 08 February 2022, in the presence of the Deputy Minister and representatives of the office of the Auditor- General South Africa (AGSA), in order to get an update on the implementation of their audit action plans for the findings of the previous financial year.
These entities included the: National Treasury (NT), SARS, Public Investment Corporation (PIC), Central Bank Development Agency (CBDA), Land Bank SOC Limited (LBIC), Government Pensions Administration Agency (GPAA), Government Technical and Advisory Centre (GTAC), 1 16 Independent Regulatory Board of Auditors and, the Land Bank- whose audit had been outstanding.
1.4.The mandate of NT is based on section 216 (1) of the Constitution which establishes it to ensure transparency, accountability and sound financial controls in the management of the country’s finances and on the Public Finance Management Act of 1999 (PFMA).
1.5.Its mandate is to coordinate intergovernmental financial and fiscal relations, promote national government’s fiscal policy and coordination of macroeconomic policy, enforce transparency and effective management of revenue and expenditure, assets and liabilities, public entities and constitutional institutions, manage the budget preparation process and, ensure the stability and soundness of the financial system and financial services.
1.6.SARS’s mandate is to contribute to the economic and social development of the country by collecting all taxes, duties and levies due to fund public service programs and priorities.

2.

POLITICAL OVERVIEW BY THE DEPUTY MINISTER OF FINANCE 2.1.The Deputy Minister of Finance, Dr David Masondo’s political overview, on behalf of the Minister, focussed on three issues: 1.
Update on the 2017 Preferential Procurement Policy Framework Act regulation in the wake of the recent Constitutional Court judgement in Minister of Finance v Afribusiness NPC (“Afribusiness”); 2.

Update on the Public Procurement Bill process; and 3. the filling of critical positions at National Treasury.

2.2.

The Deputy Minister clarified on what the Constitutional Court had ruled on in the Afribusiness judgment, as there seemed to be some confusion.
He explained that the Constitutional Court had ruled on the Minister of Finance’s powers which it said were limited to section 3 of the PPPFA, which dealt with the threshold of 80/20 and 90/10, and found that the 2017 PPPFA regulations issued by Minister in 2017 went beyond section 3 and were therefore unlawful.

2 17 2.3.

The Deputy Minister explained that, after the Afribusiness judgement, NT went back to the Constitutional Court in order to seek some clarity.
He said that NT filed an urgent application in order to establish whether the 2017 regulations would remain valid for another 12 months from the date of judgment or became invalid immediately, on 15 February 2022.

2.4.

The Deputy Minister explained that while waiting for clarity, NT had not stopped procurement.

He stated that organs of state would have to apply for an exemption from implementing the PPPFA regulations to the National Treasury.
He said that these exemptions would assist in preventing irregular expenditure and was not meant to stop procurement.

Dr Masondo assured members and the public that exemption requests would be approved within 2 days of receipt by the National Treasury.

2.5.

The Deputy Minister mentioned further that NT had also published a call for public comments in order to address issues in the Afribusiness judgment in PPPFA regulations.

He emphasised that procurement within Government has not stopped.
He also clarified that the Constitutional Court had not outlawed BBBEE, as some of the public commentary had mischaracterised the Afribusiness judgment.

2.6.On the Public Procurement Bill, Dr Masondo said that since Government was the largest buyer in the country, it had the responsibility to ensure that its procurement policy supported economic growth and transformation.

He stated that Government spending on procurement was close to R1 trillion.

2.7.
2.7.

The Deputy Minister stated that public procurement was a powerful instrument for Government to ensure that it transformed the economy to reflect the demographics of South Africa.

He also explained that public procurement was also essential for government to industrialise through prescribing local content for certain goods, among other things.
He said that Government should continue to require sellers of certain goods to the government, 3 18 to increase their local content to create more jobs, industrialise and build the country’s manufacturing base which haemorrhaged since 1994.

He highlighted that manufacturing had constituted about 24 per cent, but has now declined to 11 per cent of South Africa’s GDP.

2.8.
2.8.

The Deputy Minister put emphasis on the role of public procurement to industrial policy, stating that NT needed to ensure that Government stopped de-industrialisation that has been taking place in the country.

He stated that Clause 4 of the Public Procurement Bill proposed that state organs set asides for women, localisation, black people, and the previously disadvantaged.
The Deputy Minister explained that redressing imbalances of the past was a constitutional requirement, stating that the majority of South Africans needed to feel that South Africa belonged to all who live in it, black and white.

Dr Masondo stated that public procurement would play a major role in achieving this and informed the Committee that NT planned to table the Bill for consideration by Nedlac in May 2022.

2.9.

The Deputy Minister further updated the Committee on the filling of vacancies.
He explained that NT had had interviews for the position of Chief Procurement Officer and the Accountant-General posts and memos were awaiting Cabinet approval.

2.10.

On 03 May at the presentation of SARS’s annual performance plan, the Deputy Minister further addressed the Committee.

He reminded members that it has been 25 years since SARS was established in 1997, becoming one of the country’s shining lights of the democratic dispensation.
He stated that a well-functioning revenue service was key to the country’s developmental ambitions.

2.11.

He highlighted that since its formation, SARS had collected more than R17 trillion.

He commended SARS for having contributed to the improvement of South African lives through raising revenue which enables the country to provide, among others, healthcare, education, social security and support for the economy.

4 19 2.12.
4 19 2.12.

The Deputy Minister stated that without SARS collecting its revenues, the country would not have been able to deliver services and support the economy.

Dr Masondo stated that disruptions of the COVID pandemic, SARS had collected more revenue than expected.

He said that this was assisted by the recovery of certain sectors of the economy, especially in the mining sector.
He said that without an efficient and trustworthy revenue services, the country would not have been able to achieve this- commending SARS for staying the course.

2.13.

The Deputy Minister said that the adoption by SARS of latest digital technologies such as artificial intelligence and machine learning were signs of an institution that was in touch with the demands of the modern economy that operated in a complex environment, full of uncertainties.

2.14.
2.14.

The Deputy Minister however, raised concerns about the unacceptably low taxpayer compliance levels with their tax obligations.

He said that illicit activities and tax crimes remained a huge challenge, eroding tax morality and undermining the work of government and SARS.

He however noted the gradual improvement in the overall compliance levels and strategic policy enhancements aimed at broadening the tax base and easing the tax burden on South Africans.
He stated that he was certain that SARS would continue to perform well 2.15.

He highlighted the trying and uncertain times under which SARS was executing its mandate, such as July 2021 unrest, the recent floods, the conflict between Russia and Ukraine, and the COVID pandemic.

5 20 3.

OVERVIEW BY ACCOUNTING OFFICERS NATIONAL TREASURY 3.1.
Mr Dondo Mogajane, the Director-General of the National Treasury, stated that in implementing the NT’s plans for 2022/23, there would be many obstacles in the coming year.

He said that some of the obstacles were old and some, new.

He said that there were global risks that could devastate the local economy and impact NT were they to materialise.

3.2.
3.2.

Mr Mogajane stated that NT would need to be resilient to overcome the systemic challenges of inequality, poverty and unemployment, which were all exacerbated by chronic low growth, rapid global warming and intensifying conflicts, among other risks.

He said that this would require a determined effort from NT in pursuing ongoing endeavours to accelerate economic growth, including taking structural constraints into account, applying measures to retain investors, and restoring public trust.

3.3.
3.3.

Mr Mogajane stated that safeguarding the fiscal framework remained key to NT activities.

He also provided an overview of NT’s key focus areas for 2022/23, including the national budgeting process, managing the fiscal relations of the three spheres of government, interacting with regional and international organisations to increase South Africa’s economic development, filling critical vacancies, and gender mainstreaming.

3.4.
3.4.

He said that NT, through the Budget Facility for Infrastructure (BFI) and partnerships with the Development Bank of Southern Africa and Infrastructure South Africa, is helping to build a pipeline of viable projects for execution.

He said that the BFI has considered 61 projects that were submitted to it by public institutions and NT had approved a total of R6.7 billion in fiscal support in the 2021/22 adjustments budget and over the 2022 MTEF period.
He said that most of these projects have multiple funding sources and are designed to crowd in private investment.

6 21 3.5.

He explained that the Infrastructure Fund is working in conjunction with public agencies to prepare six projects with a total value of R96 billion.

He said that this includes the rollout of the broadband infrastructure and the construction of six new border posts.

3.6.

He said that NT is reviewing government’s macroeconomic policy from the global financial crisis to the present.
This review, he said, will: examine how key indicators, such as economic growth and employment, have evolved since 2008; assess government’s fiscal, monetary and macro-prudential policy choices; and propose appropriate reforms to policy targets and institutional frameworks.

He informed the Committee that a draft review document will be finalised at the end of March 2022, forming the basis for workshops, public discussions and additional research.
He said that a final review is expected to be published in 2023.

THE SOUTH AFRICAN REVENUE SERVICE 3.7.

SARS Commissioner, Mr Edward Kieswetter, outlined SARS’s strategic focus areas for 2020 to 2025, recapping the priorities, performance highlights for the previous financial year and the deliverables for 2022/23.

3.8.He stated that up to this year, SARS had collected almost R18 trillion, from a humble R147 billion in its first year in 1997.
He said that this year’s revenue collection had increased by 10 fold, with net revenues of over R1,5 trillion.

3.9.Mr Kieswetter reminded members that SARS has an obligation to build an effective and efficiency revenue system.

He mentioned that it is the work of SARS that enables government to build a capable state that fosters economic growth and social development.

He said that SARS higher purpose is to serve the wellbeing of all South Africans.

3.10.
3.10.

Mr Kieswetter emphasised SARS Vision 2024 to become ‘a smart, modern SARS with unquestionable integrity, trusted and admired’.

He stated that SARS theory of compliance 7 22 was underpinned by that a belief that most taxpayers are honest and simply want to fulfil their obligations with the least amount of effort and cost.
He said that SARS model was geared towards making it easy to comply by providing assistance for taxpayers to comply, detecting and deterring non-compliance and enforcement of the law.

3.11.

He said that SARS’s strategic intent was to develop a tax and customs system that is based on voluntary compliance.

He said that in order to support this intent, 9 strategic objective were developed, namely; 1.

Provide clarity and certainty for taxpayers and traders of their obligations; 2.
Make it easy for to comply; 3.

Detect those who do not comply and make non-compliance hard and costly; 4.

Develop high performing, diverse, agile, engaged and evolved workforce; 5.

Increase and expand the use of data to ensure integrity, drive insight and improve outcomes; 6.

Modernise systems to provide digital and streamlined online services; 7.

Demonstrate effective resource stewardship; 8.

Work with and through stakeholders to improve the tax ecosystem; and 9.
Build public trust and confidence in the tax administration system.

3.12.

He said that there are key “must win battles” for SARS in its strategic plan, which were to broaden the tax base by ensuring that all taxpayers are registered, improving voluntary compliance, achieving more with less resources, maintaining partnerships, and building an organisation with integrity that can be trusted and admired.

4.

OVERVIEW OF THE NATIONAL TREASURY BUDGET AND PROGRAMMES 4.1.
A total of R33.9 billion is allocated to NT in 2022/23, of which 86 percent will be appropriated to transfers and subsidies.

The projected allocations for the 2023/24 and 2024/25 are R32.0 and 32.1 billion, respectively.
8 23 TABLE 1: National Treasury budget summary and vote expenditure trends 2022/23 MTEF R million Audited outcome 2018/19 2019/20 2020/21 Sou 424.3 453.6 496.3 138.8 124.9 124.7 Average growth rate (%) 2018/19 - 2021/22 8.5% 3.5% Average: Expen- diture/ Total (%) Medium- term expenditure estimate 2022/23 0.1% 0.0% 521.6 158.2 Adjusted appropriation 2021/22 541.4 153.8 Average growth rate (%) 2021/22 - 2024/25 1.3% 2023/24 2024/25 544.0 563.5 160.4 160.4 1.4% Average: Expen- diture/ Total (%) 0.1% 0.0% Programme 2: Economic Policy, Tax, Financial Regulation and Research Programme 3: Public Finance and Budget Management Programme 4: Asset and Liability Management Programme 5: Financial Accounting and Supply Chain Management Systems Programme 6: International Financial Relations Programme 7: Civil and Military Pensions, Contributions to funds and Other benefits Programme 8: Revenue Administration Programme 9: Financial Intelligence and State Security.
Subtotal 2,530.4 2,936.1 2,697.2 4,337.5 19.7% 0.4% 4,438.2 4,354.7 3,443.1 -7.4% 0.4% 91.2 96.7 3,022.6 9,017.9 362.4% 0.4% 1,126.0 1,120.0 128.0 -75.8% 0.3% 771.4 733.9 696.6 1,046.0 10.7% 0.1% 1,122.1 1,375.9 1,172.0 3.9% 0.1% 5,807.7 5,458.8 6,640.5 7,745.9 10.1% 0.8% 2,637.8 2,590.3 2,875.1 -28.1% 0.4% 5,020.1 5,487.1 5,188.8 6,409.5 8.5% 0.7% 7,012.1 7,039.0 7,355.1 4.7% 0.8% 9,007.2 9,529.0 10,271.9 11,295.2 7.8% 1.3% 11,527.8 11,657.6 11,136.2 -0.5% 1.2% 4,763.5 4,951.1 4,942.9 4,999.5 1.6% 0.6% 5,395.5 5,402.1 5,643.9 4.1% 0.6% 28,554.6 29,771.2 34,081.5 45,546.7 16.8% 4.4% 33,939.2 34,244.1 32,477.3 -10.7% 4.0% Source: National Treasury ENE22 Vote 8 4.2.Programme 1: Administration 4.2.1.
The Administration programme provides strategic leadership, management and administrative support and capacity building to the National Treasury.

A budget of R R521.6 million is allocated in 2022/23, down from an adjusted appropriation of R541.4 million in 2021/22.

The projected allocation for the outer two financial years of the MTEF is R544.0 and R563.5 million, respectively.

4.2.2.
4.2.2.

This programme has the following sub-programmes and their allocations for 2022/23: Ministry (R4,4m); Departmental Management (R56.3m); Corporate Services (R167m); Enterprise-wide Risk Management (R37.3m); Financial Administration (R53.6m); Legal Services (R23.9m); Internal Audit (R31.1m); Communications (R9.2m); and Office Accommodation (R138.4m).

9 24 4.2.3.
The priorities of this programme include: monitoring of the efficiency of ICT by ensuring 93 per cent delivery against the service level agreements; ensuring the usefulness and reliability of the reported performance information in accordance with the performance management and reporting framework by obtaining an unqualified audit opinion with 25% fewer findings than 2021/22 on financial and nonfinancial performance information; ensuring good governance and sound control environment by achieving level 4 of the risk management maturity assessment; advancing organisational optimisation by utilising 70% of the training and development budget; and producing 4 quarterly progress reports on the extent of mainstreaming and institutionalisation of Women, Youth, Persons with Disabilities (WYPD) in the department through the implementation of the action plan on gender mainstreaming.
4.3.Programme 2: Economic Policy, Tax, Financial Regulation and Research 4.3.1.

This programme is dedicated to economic policy research, analysis and advisory services in the areas of macroeconomics, microeconomics, the financial sector, taxation and regulatory reforms.

The 2022/23 allocation is R158.2, up from 153.8 million in the 2021/22 adjustment budget.

Over the medium term, the budget is projected to grow by 1.4%, to R160.4 million each in the two outer years.

4.3.2.
4.3.2.

This programme aims to publish 15 research papers through the SA-TIED programme, table financial sector and tax legislation in Parliament, develop four economic forecasts that provide reliable macro-economic projections to aid policy-making, produce four relevant micro and macro-economic research outputs that contribute to the promotion of macroeconomic stability, poverty alleviation, retirement reform, social security and the development of inclusive growth and job creating policies.

10 25 4.3.3.
10 25 4.3.3.

It has the following sub-programmes for 2022/23: Programme Management for Economic Policy, Tax, Financial Regulation and Research (R51.5m); Financial Sector Policy (R24.7m); Tax Policy (R32.6m); Economic Policy (R28.6m); and Cooperative Banks Development Agency (R20.8m).

4.4.Programme 3: Public Finance and Budget Management 4.4.1.

This programme provides analysis and advice on fiscal policy, public finances and, intergovernmental financial relations.
It manages the annual budget process of government and provides public finance management support.

This programme was expanded to incorporate what was previously programme 8 “Technical Support and Development Finance” in the previous strategic plan of NT.

It is also aimed at facilitating employment creation and high-impact government initiatives, and strengthen infrastructure planning and delivery 4.4.2.
This programme will be allocated R4,4 billion in 2022/23, up from 4,3 billion in the adjustment budget.

The projected allocations are R4,3 and 3,4 billion for the outer two years of the MTEF.

4.4.3.
4.4.3.

This programme has got the following sub-programmes (and allocations): Programme Management for Public Finance and Budget Management (R34.7m); Public Finance (R64.7m); Budget Office and Coordination (R66.4m); Intergovernmental Relations (285.5m); Financial and Fiscal Commission (R63.8m); Facilitation of Conditional Grants (R2,4b); Catalytic Infrastructure and Development Support Programme (R654.1m); and the Government Technical Advisory Centre (R789.4m).
4.5.Programme 4: Asset and Liability Management 11 26 4.5.1.

The Asset and Liability Management programme manages financial assets, national debt and liquidity requirements of the fiscus in order to facilitate national expenditure and maintain favourable sovereign debt ratings.
Over the medium term, the strategic focus of this programme continues to be its oversight of state owned companies (SOCs) by enabling them to meet government’s policy objectives in a financially and fiscally sustainable manner, as well as promote sound corporate governance.

4.5.2.
Other targets are to: ensure timely and accurate payment of government debt obligations to avoid any credit defaults; finance government’s gross borrowing requirement over the MTEF and minimise risks emanating from government’s fiscal obligations by measuring performance and ensuring compliance with market and refinancing risk benchmarks; ensure sound management of government’s cash resources by meeting government’s liquidity requirements at all times and; produce 4 reports on the management of government’s contingent liabilities.
4.5.3.

This programme’s budget allocation for 2022/23 is R1,1 billion, down from an adjustment allocation of R9.0 billion the previous year.

The programme is allocated R1,1 billion in 2023/24, decreasing sharply by -75.8% to R128 million in 2024/25.

4.5.4.
4.5.4.

This programme consists of the following sub-programmes and allocations: Programme Management for Asset and Liability Management (R31.8m); State-Owned Entity Financial Management and Governance (R1,0b); Government Debt Management (R20.6m); Financial Operations (R25.8m); and Strategy and Risk Management (R12.0m).

4.6.Programme 5: Financial Accounting and Supply Chain Management System 4.6.1.
This programme has been allocated R1,1 billion in 2022/23, from an adjustment budget of R1 billion the previous year.

The projected allocations in the outer financial years of 12 27 the MTEF are R1,3 and R1.1 billion, respectively.

The purpose of this programme is to facilitate governance and accountability by promoting and enforcing the transparent, economic and effective management of revenue, expenditure, assets, liabilities and supply chain processes in the public sector.

4.6.2.
4.6.2.

The programme seeks to promote effective and efficient government financial management and accountability across the three spheres of government.

A major focus has been placed on improving government procurement processes and identifying malpractices as a result of procurement irregularities through the Office of the Chief Procurement Officer sub-programme.

4.6.3.
4.6.3.

This programme has the following sub-programmes (and their allocations): Programme Management for Financial Accounting and Supply Chain Management Systems (R 122.3m); Office of the Chief Procurement Officer (R68.7m); Financial Systems (R626.4m); Financial Reporting for National Accounts (R112.3m); Financial Management Policy and Compliance Improvement (R142.1m); Audit Statutory Bodies (R50m); and Service Charges: Commercial Banks (0.3m) 4.7.Programme 6: International Financial Relations 4.7.1.
The programme’s mandate is to manage South Africa’s interests in shaping regional and global policies that advance the economic, financial and development objectives of the country and the African continent.

4.7.2.
The focus and targets of this programme this year are to: ensure 100% response to all economic surveillance reports; host one advocacy forum to increase the uptake of development finance; produce two country partnership framework progress reports that report on the relationship between the government of South Africa and various Multilateral Development Banks that operate within the Republic of South Africa; 13 28 produce one analysis report on the outcomes of South Africa’s engagements in regional and global forums; develop policy positions to measure South Africa’s engagement in various global forums and institutions.
4.7.3.

This programme has been allocated R2,6 billion in 2022/23, decreasing from R7,7 billion in the adjustment budget of 2021/22.

It is projected to be R2,5 billion and R2,8 respectively in the two outer years of the MTEF.
It has the following sub-programmes for 2022/23: Programme Management for International Financial Relations (R10.8m); International Economic Cooperation (R52.4m); Africa Integration and Support (R1,4b); International Development Funding Institutions (R1,1b); and International Projects (R23m) 4.8.Programme 7: Civil and Military Pensions, Contribution to Funds and Other Benefits 4.8.1.
The mandate of this programme is to ensure that government’s pension and post- retirement medical benefit obligations to former employees of the state and retired military members are fulfilled.

Its allocation amounts to R7,0 billion in 2022/23, R7,0 and R7,3 billion respectively in the two outer year of the MTEF.

4.8.2.
4.8.2.

The sub-programmes and their allocations under this programme for 2022/23 are: Government Pensions Administration Agency (R79.8m); Civil Pensions and Contributions to Funds (R6,6b); and Military Pensions and Other Benefits (R251.7m).

4.9.Programme 8: Revenue Administration 4.9.1.

The Revenue Administration programme receives an allocation of R11,5 billion in 2022/23, up from R11,2 in the adjustment budget of 2021/22.
In the outer years of the MTEF, the allocations are projected at R11,6 and 11,1 billion respectively.

The budget allocation is a transfer payment to the South African Revenue Service, which is 14 29 responsible for administering the country’s revenue system.

This programme is discussed further below under SARS’s annual performance plan.

4.10.

Programme 9: Financial Intelligence and State Security 4.10.1.
Financial Intelligence and State Security comprises transfers to the Financial Intelligence Centre (FIC) to combat financial crimes, including money laundering and terrorism-financing activities.

The 2022/23 allocation for the Financial Intelligence Centre and the South African Secret Services is R5,3 billion, from R4,9 billion in the adjustment budget of 2021/22, and increasing to R5,4 and R5,6 billion in the outer years.
The allocation to Financial Intelligence Centre for 2022/23 is R316.8 million and Secret Services, R5,0 billion.

5.

OVERVIEW OF THE SARS’S BUDGET 5.1.SARS receives a transfer from National Treasury under Programme 8.

In 2022/23 SARS will be allocated a total budget of R11,5 billion from R11,2 in the adjusted appropriation of 2021/22.

R46.5 million of this is a grant to the Office of the Tax Ombuds (OTO), an increase of 2.6 per cent from the previous year’s adjusted appropriation.
The allocation to SARS is projected to increase to R11,6 billion in 23/24, moderating to R11, 1 billion in 2024/25.

The allocation to the OTO will increase to R51.2 million and R53.5 million, an average increase of 6.1 per cent over the MTEF.

5.2.
5.2.

SARS stated that it had: collected R1.56 trillion in 2021/22 (which was 255 more than in 2020/21); paid refunds of R321 billion (R20 billion more than 2020/21); collected R209.7 billion compliance revenue (21% more than the previous year); and facilitated trade totalling R3.3 trillion (which was 27% more than in 2020/21).

15 30 6.
15 30 6.

OTHER ENTITIES VISITED BY THE COMMITTEE 6.1.The Committee undertook an oversight visit to the South African Special Risk Insurance Association (SASRIA), the Land and Agricultural Development Bank of South Africa (Land Bank) and the Financial and Fiscal Commission (FFC) from the 20 – 22 April 2022 in Gauteng.

The Committee observations and recommendations on the oversight visit will be included in the Oversight Report.

SOUTH AFRICAN SPECIAL RISK INSURANCE ASSOCIATION (SASRIA) 6.2.
The main purpose of the visit to SASRIA was to get presentation of their annual report, strategic and annual performance plans, and the implementation of the audit action plans.

It was also to get a detailed briefing on how 2021 July unrests impacted on SASRIA.

6.3.

Established in 1979, SASRIA is owned by the government of South Africa as the sole shareholder.
It is mandated to provide cover for special risks such as riots, strikes, political unrest, terrorist attacks, civil commotion, public disorder and labour disturbances.

6.4.Over the medium-term, SASRIA focusses on improving its financial performance and revising its reinsurance structure, where 40 per cent of the insurance business is ceded to reinsurers with catastrophe cover of R10 billion in years 1 and 2.
6.5.The expenditure of SASRIA is expected to decrease to an average annual rate of 43.2 per cent, from R27 billion in 2021/22 to R5 billion in 2024/25.

This is manily due to additional funding of R14.9 billion from government in 2021/22 to assist the association in covering the cost of claims related to the 2021 July unrest.
6.6.SASRIA expects to derive 95.7 per cent (R18 billion) of its revenue over the MTEF period from client premiums, with overall revenue increasing at the average annual rate of 8.1 per cent.

16 31 6.7.SASRIA incurred claims amounting to R37.14b as at 19 April 2022 as a result of the 2021 July unrests which affected KwaZulu-Natal and parts of Gauteng.

R22.52b have already been settled, representing a total of 8 853 claims.

R14.62b, representing a total of just over 17 000 claims, remains outstanding.
6.8.In terms of liquidity, the cash injection from National Treasury in January and increase in premium flows ensured that there is no immediate liquidity challenge.

The financial sustainability projections indicate that the business will be profitable by the 2022/23 financial year.

6.9.Sustainability concerns remain, and if any event the magnitude of the July unrest was to happen; SASRIA cautioned that it would not survive as a business.
The stakeholder management component developed a media strategy that is yielding positive results.

SASRIA maintains it has good relationships with all its stakeholders which include clients, brokers, National Treasury and the regulators.

6.10.

SASRIA will seek to implement risk mitigation initiatives as well as new underwriting initiatives.
A new re-insurance structure was implemented in August 2021, new rates implemented in February 2022, and a new MOI was approved by the Minister of Finance and awaiting Prudential Authority approval.

LAND AND AGRICULTURAL DEVELOPMENT BANK OF SOUTH AFRICA (LAND BANK) 6.11.

The Land Bank is a development finance institution mandated to address agricultural and rural development in South Africa.
It receives its mandate from the Land and Agricultural Development Bank Act of 2002 and is regulated by the Public Finance Management Act.

It is expected to play a pivotal role in advancing agriculture and rural development.

17 32 6.12.

The Land Bank has been experiencing liquidity and funding challenges, which resulted in a default on its debt.

It has not yet finalised the liability solution to address the liquidity challenges and this posed significant uncertainty regarding its going concern status.
The Auditor-General recommended that oversight and monitoring be strengthened to ensure that the turnaround strategies of the Land Bank are implemented and the liability solution is finalised in order to mitigate the related financial and economic risks associated with the Land Bank.

6.13.
6.13.

Land Bank’s expenditure is expected to decrease at an average annual rate of 22.3 per cent, from R3 billion in 2021/22 to R1.4 billion in 2024/25, due to average annual decreases in spending of 17.5 per cent on goods and services as part of the bank’s efforts to ensure greater cost efficiency, and 27.7 per cent on interest expenses.

The decrease in interest is mainly driven by writing off some outstanding loans and the early settlement of others.

6.14.
6.14.

Land Bank’s spending on compensation of employees is expected to decrease at an average annual rate of 7.6 per cent, from R389.3 million in 2021/22 to R307.4 million in 2024/25, due to natural attrition.

The bank is set to derive an estimated 96.4 per cent (R5.8 billion) of its revenue over the period ahead through interest income, decreasing at an average annual rate of 15.6 per cent, from R2.6 billion in 2021/22 to R1.5 billion in 2024/25, in line with the projected reduction in the loan book.
6.15.

In April 2020, the Land Bank defaulted on certain payment obligations and this triggered a cross default on substantially all of the Bank’s borrowings.

The Bank suspended the payment of interest and capital across all of its facilities.

Since the default the Bank has been in a de facto standstill with all its lenders (except for one lender who has since been settled).
All lenders have not called on the Bank to settle its debts and have thus far ensured that the Bank does not have to liquidate its assets to settle them.

The Bank has continued to service interest payments and has been able to reduce debt by 28% since default.

In May 18 33 2020, the Bank appointed a Corporate Finance Advisor to design and implement a Liability Solution and cure the event of default.

Three versions of the Liability Solution have been considered since then.

6.16.
6.16.

In June 2020, R3b equity injection by the State was announced and received in September 2020.

This was intended to provide a degree of financial stability to the Land Bank in order to be able to sustain its disbursements to existing customers and resume the payment of interest to Lenders.

In August 2020 the Bank paid arrear interest and resumed normal interest payments.
A request for recapitalisation of the Land Bank was submitted into the Medium Term Budget process, and a R7b recapitalization was subsequently announced.

6.17.
6.17.

Since the inception of the event of default situation in April 2020, the Land Bank has worked to restore and catch up all interest due on all funding and in addition has made the following three capital reduction payments to the South African lenders: February 2021: 12% (R4.9 billion) of capital outstanding; June 2021: 10% (R3.4 billion) of the then capital outstanding, and October 2021: 10% (R3.1 billion) of the then capital outstanding.
Although this adds up to 32% it represents a 28.7% (R11.4 billion) reduction of the original amount outstanding to South African lenders.

6.18.

The newly appointed Land Bank Board convened a workshop with all the local lenders, on 09 February 2022, to consider all the burning issues raised by the lenders about the proposed Liability Solution.
The Lenders have requested for reasonable time to work through the proposals, and have provided an indicative date of 30 September 2022 as a realistic time to finalise an acceptable Liability Solution.
In the meantime, the Board has obtained the in principle support of the lenders to resume lending activities by setting aside R500m of its cash resources to originate a new portfolio of development clients, whilst 19 34 continuing to support existing clients with their production and seasonal loan financing requirements.

6.19.

Liquidity challenges at the Land Bank continues to hamper its support for the sector.
The default status has disabled the Land Bank from sourcing new funding, thus restricting it from fully supporting the loan requirements of its clients.

Since the default, the Bank has been reliant on collections of instalments / repayments it receives from its clients to service interest and partial capital redemption of its debts, as well as to cover its operating cost commitments.

6.20.
6.20.

The Land Bank cannot fully commence with its developmental and transformation initiatives if it is not cured from the default, and get its funding structure resolved for a financially sustainable business model.

Work is in progress between the Land Bank, lenders and the shareholder to develop a liability solution that will be acceptable to all stakeholders in order to cure the Bank’s default.
The solution will take cognisance of the conditions of the capital injection that were outlined by the Minister of Finance following the appropriation of R7bn of equity injection by Parliament.

FINANCIAL AND FISCAL COMMISSION 6.21.

FFC derives its mandate from the Financial and Fiscal Commission Act (1997), which requires the commission to advise relevant authorities on financial and fiscal requirements for national, provincial and local spheres of government in terms of section 220 of the Constitution.
It also derives its mandate from the following: the Borrowing Powers of Provincial Governments Act (1996), the Intergovernmental Fiscal Relations Act (1997), the Provincial Tax Regulation Process Act (2001), the Municipal Finance Management Act (2003), the Municipal Systems Amendment Act (2003), the Municipal Fiscal Powers and Functions Act (2007), and the Money Bills Amendment Procedure and Related Matters Act (2009).

20 35 6.22.

The FFC receives a transfer, from NT’s budget vote.
FFC’s expenditure is expected to increase at an average annual rate of 0.9 per cent, from R63.6 million in 2021/22 to R65.4 million in 2024/25.

The allocation is R63.9 million for 2022/23.

FFC’s spending on compensation of employees is its main cost driver, increasing at an average annual rate of 8.4 per cent, from R30 million in 2021/22 to R38.3 million in 2024/25, due to a projected increase in personnel from 43 in 2021/22 to 48 over the medium term.

6.23.
6.23.

FFC’s spending on goods and services, the commission’s second‐largest cost driver, is set to decrease at an average annual rate of 7 per cent, from R33.2 million in 2021/22 to R26.7 million in 2024/25, due to cost‐cutting measures implemented on administration and a reduction in the use of external researchers.

6.24.

The FFC is comprised of two programmes, namely the administration programme and the research programme.
The proportion of the FFC’s total budget taken up by the Research Programme has decreased from 36.7% in 2018/19 to 16.2% in 2020/21 in the audited outcomes.

Over the medium term, on average, 67.5% of the total expenditure is concentrated on Administration, which consists of Office of the Chairperson, Commissioners, CEO’s office, Finance and Corporate Services.

Of the total staff complement of 37, there are 7 full-time researchers including the Head of Research, and 11 research interns.

6.25.
6.25.

Slower spending during the financial year has accumulated to an underspending of R11.5 million in the budget or accumulated surplus of R12.4 million for the financial year.

The cash balance at the end of the year amounts to R16.2 million.

This is in spite of the return of prior year surplus to the fiscus of R19.7 million made during the year.

21 36 7.

OBSERVATIONS AND RECOMMENDATIONS 7.1.


The Committee notes the annual performance plans of the NT and SARS and their key priorities and performance targets as presented to it.

It also notes the plans of the FFC and updates given by SASRIA and the Land Bank.

Specific observations and recommendations on the FFC, SASRIA and the Land Bank will be included in the Committee’s Oversight Visit Report.

IMPLEMENTATION OF AUDIT ACTION PLANS 7.2.


The Committee notes the updates it received on 8 February 2022 on the implementation of the audit action plans developed to remediate the adverse audit findings raised by the Auditor-General of South Africa (AGSA) in the previous year’s financial statements.

This followed from the Committee’s recommendation in the Budgetary Review and Recommendation Report of 2021.
The updates were given by NT, Land Bank, government Pensions Administration Authority (GPAA), Government Technical Advisory Centre (GTAC), Independent Regulatory Board of Auditors (IRBA), the Public Investment Corporation (PIC), and the Cooperative Banks Development Agency.
The Committee will continue to heighten its oversight over the implementation of the audit action plans as it wants to see improved governance outcomes within the finance portfolio, which is the custodian of public finances for the rest of government.

7.3.

The Committee believes that the implementation of audit action plans should form part of the annual performance plans of NT and entities in the portfolio, with measurable targets and outcomes, and urges the Minister to consider this.
7.4.The Committee believes that improving audit outcomes of the finance portfolio is a combined effort of management, audit committees, internal audit divisions and the AGSA.

It believes that management plays a critical role in ensuring that the audit action plans tackle the root causes that lead to the AGSA’s findings and that actions are tailor-made to address such challenges.

The internal audit function should also play a crucial role in ensuring that action plans are implemented more effectively.
The audit committees should also play their oversight role in ensuring that quarterly reports show sustainable improvements in audit outcomes.

The Committee also 22 37 urges for the improvement in the prevention of internal control deficiencies from happening in the first place.

7.5.The Committee expects to see improved audit outcomes from all the entities that the AGSA raised findings on in the previous financial year.

FILLING OF LEADERSHIP AND SENIOR MANAGEMENT VACANCIES 7.6.
The Committee notes that there remains a number of vacant strategic positions across the finance portfolio.

The importance of filling such positions cannot be gainsaid as, according to the AGSA, leadership and senior management instability contributes to governance challenges which then lead to adverse audit outcomes.

A contributing root cause to poor audit outcomes, according to AGSA, is the instability caused by prolonged vacancies or acting appointments in key positions.
In this regard, the Committee urges the Minister of Finance to prioritise the filling of vacancies at executive and senior management levels in the National Treasury and in the entities across the finance portfolio.

7.7.

The Committee remains concerned about delays in filling up the positions of Chief Procurement Officer and the Accountant-General and many acting positions in many entities such as GTAC and GPAA.
The Committee however welcomes the update from the Deputy Minister that interviews have been conducted on the positions of Chief Procurement Officer and Accountant-General, with the memos having been submitted to Cabinet for approval.

7.8.

In its BRRR report of 2021, the Committee noted the increasing complaints regarding service at GPAA.
In response to questions from the Committee, Mr Mogajane admitted to administrative challenges at GPAA caused by, among others, leadership instability as there was no Head of GPAA.

The Committee urges the Minister to prioritise the appointment of the Head of GPAA, and to take immediate action to finalise cases, so as to resolve the service delivery challenges.

7.9.

The Committee commends the Minister for the appointment of the new board of directors at the Land Bank.
The Committee urges the Minister to prioritise the appointment of a new CEO, as Mr Ayanda Kanana has resigned.

The Committee wishes Mr Kanana well in his new journey.

23 38 7.10.

The Committee notes announcements by the Minister that Mr Mogajane will be vacating his position at the end of his contract in June.

The Committee thanks and wishes Mr Mogajane well.

It also urges the Minister to prioritise the filling of this position.

7.11.
7.11.

The Committee was very impressed by the succession planning at SASRIA where the incoming CEO has been shadowing the outgoing CEO.

The Committee believes that this assists in ensuring a smooth leadership handover and stability.

The Committee believes that it is possible to achieve this in other entities as vacancies are normally known in advance.

7.12.
7.12.

After the adoption of this report, and within 30 days, the Committee requires the Minister of Finance to submit to it a list of all vacant and acting leadership and senior management positions across the finance portfolio.

This list should highlight how long such positions have been vacant or filled in an acting capacity, the reasons for the delays in filling them, and steps being taken to fill them.

PUBLIC PROCUREMENT BILL 7.13.


The Committee notes further delays in the tabling of the Public Procurement Bill.

In all its reports over the past few years, the Committee has been urging NT to expedite the introduction of this Bill for processing by Parliament.

The Committee believes that this Bill will assist in consolidating the fragmented procurement regime in the country, and help to root out corruption within the procurement system, among others.
The Committee again urges NT to prioritise this Bill IFMS 2 PROJECT AND MATERIAL IRREGULATIRY 7.14.

The Committee notes that NT has incurred fruitless and wasteful expenditure of about R300 million on the Integrated Financial Management System (IFMS) project since 2016, as NT made payments for which no services were received on technical support and maintenance for the IFMS.
While the Committee had scheduled an oversight visit on this 24 39 project, there was a clash in its schedule as the Minister and DG Mogajane had to attend the IMF/World Bank Spring Meetings in Washington DC.

7.15.
7.15.

The Committee remains concerned about the IFMS project since the IFMS contract was renewed for a further 5 years last year, despite the fruitless and wasteful expenditure raised by AGSA for successive years since 2016 and the issuing of the material irregularity against the DG of National Treasury.

7.16.

The Committee expects to be updated on the developments on this material irregularity issue in the next quarterly briefing by NT.
It also expects to be briefed on whether the investigations on the IFMS by the Special Investigations Unit, the Hawks, and the Public Protector have been finalized or not.

The Committee will also invite the Office of the AGSA to the next quarterly meeting as the IFMS project issues need to be resolved, once and for all, as they have dragged on for too long.

NT PROGRAMMES 7.17.
NT PROGRAMMES 7.17.

The Committee notes that NT is reviewing government’s macro-economic policies since the global financial crisis of 2008 to the present.

This macro-economic policy review will examine how key indicators such as economic growth and employment have evolved since then.

It will also assess the government’s fiscal, monetary and macro-prudential policy choices; and propose appropriate reforms to policy targets and institutional frameworks.
The Committee expects to be briefed on this review once it is finalized.

7.18.

The Committee was concerned by media reports which purported that, as the custodian of national assets of the country, NT was not involved in the disposal of 51 percent of SAA shares to a private equity partner.

The Committee would like to emphasise that NT needs to play its role as provided for in section 54 of the Public Finance Management Act, 1999, when significant shareholding is disposed of in State-Owned Companies.
25 40 7.19.

Considering the dire situation of financial management in municipalities, the Committee is doubtful of the effectiveness of the Municipal Finance Improvement Programme (MFIP).

The Committee will schedule a briefing on the details of this programme and its achievements and challenges over the past financial years given that the MFIP five-year programme cycle is coming to an end.

It will be important to take stock of the lessons learned and challenges encountered.
The Committee will liaise with the Department and the Portfolio Committee on Cooperative Government and Traditional Affairs (COGTA) in order arrange a joint briefing on this sub-programme.

7.20.

On Programme 7, the Committee notes the ongoing challenges with the payment of the military veterans’ pensions.

The Committee further notes that NT has discovered many irregularities, including that some veterans would not necessarily be veterans.
The Committee will, in the near quarter, schedule a briefing on the details of these challenges and how they are being resolved.

The Committee will explore that possibility of a joint- briefing with all the affected departments and Committees of Parliament.

7.21.

As stated in the Committee’s previous report, the Committee notes that although ongoing, the pension fund reforms have been very slow.
The Committee also notes that one of the main reasons for the slow progress is the complexity of discussions at Nedlac.

The Committee requires NT to brief it on the progress being made on these reforms, including specific action with deadlines to be taken.

7.22.

The Committee notes the work of NT on the funding of anti-gender-based violence efforts under Programme One.
In view of the escalation of gender-based violence, the Committee would like to be briefed in more details on this in the next quarterly briefing.

26 41 SARS PROGRAMMES 7.23.

The Committee notes that since its formation in 1997, SARS has collected almost R18 trillion to date, from a humble R147 billion in its first year.

In the previous financial year, SARS’s revenue collection has increased by 10 fold since 1997, with net revenues of over R1,5 trillion.

The Committee commends SARS on these milestones.


7.24.

The Committee also agrees with the Deputy Minister that a well-functioning revenue service is key to the country’s developmental ambitions.

The Committee also acknowledges the contribution of SARS to the improvement of the lives of South Africans and residents through the raising of revenue which enables the country to provide, among others, healthcare, education, social security and support for the economy.

7.25.
7.25.

The Committee believes that for the tax base to broaden and voluntary compliance to improve, the economy needed to grow.

It is also important to ensure that the manner in which government spent is responsible.

The Committee is of the view that while taxpayers have an obligation to comply with the law, there is also a mutual obligation on the state to deliver services, spend wisely and ensure consequence management for those who misuse or misappropriate state resources.

7.26.
7.26.

The Committee further believes that tackling tax avoidance and illicit financial flows are crucial in improving the position of the country’s fiscus.

The Committee therefore welcomes the re-establishment of the Tax Committee led by Judge Dennis Davis to examine areas that posed the highest risks of aggressive tax avoidance and transfer pricing.

The Committee will invite Judge Dennis Davis and SARS to make presentations on the findings of the Tax Committee’s enquiries in the near future.

7.27.
7.27.

The Committee will also request a briefing on the country-by-country reporting and automatic exchange of information projects and their impact in raising revenue since they became effective a few years ago.

27 42 7.28.

The Committee re-emphasises the need for the finalization of the global framework on the taxation of e-commerce and online businesses, especially when it comes to income tax.
The Committee however notes that SARS already collects VAT from e-commerce transactions, with VAT on e-services yielding R1 billion in the last financial year.

7.29.

The Committee notes that the Public Protector recently released a report that found some violation of procurement policies at SARS over a number of years with respect to the appointment and extension of some IT contracts.
The Committee expects to be fully briefed on this report and steps being taken to remedy the situation and will schedule a briefing in this regard.

7.30.

The Committee notes that women represented in leadership positions at SARS now stands at 49.91 per cent.

The Committee would like to see more being done on the inclusion of persons with disabilities.
Having considered the annual performance plans and the proposed budget vote for the National Treasury, the Committee asks the National Assembly to adopt the Budget Vote 8 Report.

The Democratic Alliance (DA) reserves its position.

The Freedom Front Plus rejects the report.

Report to be considered.

28 43 3.


REPORT OF THE PORTFOLIO COMMITTEE ON AGRICULTURE, LAND REFORM AND RURAL DEVELOPMENT ON THE 2022/23 ANNUAL PERFORMANCE PLANS AND THE BUDGET OF THE DEPARTMENT OF AGRICULTURE, LAND REFORM AND RURAL DEVELOPMENT AND ITS ENTITIES, VOTE 29, DATED 10 MAY 2021.
The Portfolio Committee on Agriculture, Land Reform and Rural Development (hereinafter referred to as the Portfolio Committee) examined the 2022/23 Vote 29: Agriculture, Land Reform and Rural Development and budget projections for the Medium Term Expenditure Framework (MTEF) period ending in the 2024/25 financial year.
The process entailed scrutiny of the 2022/23 Annual Performance Plans (APPs) and Budgets of the Department of Agriculture, Land Reform and Rural Development (hereinafter referred to as the Department), and the relevant National Public Entities during briefings held on 19, 20 and 22 April and on 03 May 2022.

Therefore, the Portfolio Committee reports as follows: 1.
Introduction This report accounts for the process embarked upon by the Portfolio Committee on Agriculture, Land Reform and Rural Development to consider Vote 29: Agriculture, Land Reform and Rural Development as tabled by the Minister of Finance, and the Five-Year Strategic Plans and Annual Performance Plans of the Department of Agriculture, Land Reform and Rural Development (hereinafter referred to as the Department), and relevant public entities as listed in Table 1.
The Committee process followed the tabling of Strategic Plans, APPs and budget allocations by the Department and its national public entities in Parliament as required in terms of the Public Finance Management Act (PFMA), 1999 (Act No.

1 of 1999).

The APPs outline the annual plans in line with Strategic Plans and the allocated budget as per the Estimates of National Expenditure (ENE) tabled by the Minister of Finance.
These planning documents were tabled in March and April 2022; and presented at briefing sessions on 19, 20 and 22 April as shown in Table 1 of this report.
Table 1: Briefing Sessions by the Department and its Public Entities 1 44 Department and Public Entities under Vote 29 Date of briefing Department of Agriculture, Land Reform and Rural Development 20 April 2022 Commission on Restitution of Land Rights KwaZulu-Natal Ingonyama Trust Board Office of the Valuer-General Agricultural Research Council Onderstepoort Biological Product National Agricultural Marketing Council Perishable Products Export Control Board 20 April 2022 03 May 2022 20 April 2022 19 April 2022 22 April 2022 20 April 2022 20 April 2022 During the scrutiny of the Strategic Plans and the APPs, the Portfolio Committee assessed whether the plans of the Department and Entities were aligned to the State-of-the-Nation Address (SONA) of February 2022, the National Development Plan (NDP) policy priorities and targets, the 2020- 2024 Medium Term Strategic Framework (MTSF) and other key government policy priorities.
3.

Overview of the Strategic Focus of the Department of Agriculture, Land Reform and Rural Development, 2022/23 Annual Performance Plan and Budget Allocation 3.1 The Department of Agriculture, Land Reform and Rural Development and its Core Functions The main aim of the Department of Agriculture, Land Reform and Rural Development is to provide equitable access to land, integrated rural development, sustainable agriculture and food security for all.
The Department’s legislative mandate is derived from Sections 24(b)(iii), 25, and 27(1) of the Constitution of the Republic of South Africa (1996) that deal with environment and natural resources clause; property rights and land reform clause; and health care, food, water and social security clause - a framework for comprehensive rural development.
The strategic focus of the Department in the current five-year strategic framework period is to accelerate land reform, catalyse rural development and improve agricultural production to stimulate economic development and food security.

The seven Strategic Outcomes for the current MTSF period are aligned to MTSF priorities as shown in Table 2 below.

2 45 Table 2: Alignment of Department Outcomes and the 2020-2024 MTSF Priorities Department Outcome (OC) MTSF Priority (P) 1.
Improved governance and service excellence P1: A capable, ethical and developmental state 2.

Spatial transformation and effective land P5: Spatial integration, human settlements & administration local government 3.

Redress and equitable access to land and P2: Economic transformation & job creation producer support and P5 4.

Increased production in the agricultural sector P2 and P3: Education, skills and health 5.

Increased market access and maintenance of P2 and P7.
A better Africa & world existing markets 6.

Integrated and inclusive rural economy P2 and P5 7.
Enhanced biosecurity and effective disaster risk P5 reduction The Department’s plans for the 2022/23 financial year are further informed by the following key issues that have been highlighted by the President in the State of the Nation Address (SONA): • Anticipated approval of the Expropriation Bill to speed up land reform and expand access to land; and finalising the establishment of the Agriculture and Land Reform Development Agency that is expected to play a central role in coordinating land reform and farmer support initiatives.
• Regulatory framework for industrial hemp and Cannabis sectors for potential job creation (approximately 130 000 potential jobs) and investment.

• The Sugar and Poultry Master Plans to increase investment, improve production and transformation in the two industries.
• Prioritisation of infrastructure projects under the R100 billion Infrastructure Fund, wherein Government plans to make an initial investment of R1.8 billion in bulk infrastructure, which will unlock seven private sector infrastructure projects valued at R133 billion.

• Supporting smallscale farmers and integrating them in the value chain.
Over 100 000 farmers that have already received production inputs vouchers to expand their production through the Presidential Economic Stimulus Initiative (PESI); and the plans to expand the issuance of the inputs vouchers so that 250 000 smallscale farmers can be reached this financial year.
3 46 3.2 Overview of the 2022/23 Budget Allocation and the Medium Term Expenditure Framework Estimates of the Department The Department’s budget will be decreasing over the medium term, its appropriation for the 2022/23 financial year is R17.3 billion, which is less than the R18 billion that was the adjusted appropriation for 2021/22.
The decline in budget over the medium term expenditure framework (MTEF) period is across all Programmes except in Administration, which sees an average growth rate of 9 per cent over the medium term.

As the Department constitutes both national and concurrent functions, approximately 53 per cent of the total vote appropriation (R9.1 billion) goes to transfers and subsidies, which include transfers to some of the Department’s entities, land reform grants and transfers to provinces as conditional grants.
More than half of the Department’s total appropriation will be allocated to Programme 3: Food Security, Land Reform and Restitution during 2022/23.
As it has been the case in the previous financial year and despite its important and central role in agricultural production, biosecurity and management of agricultural disasters, Programme 2 will be allocated 14 per cent of the Department’s total appropriation while the Administration Programme will receive approximately 21 per cent of the total vote, which is 5 per cent more than in the previous financial year.
Approximately R4 billion of the Department’s total appropriation, which is just under a quarter of its total budget allocation will go to compensation of employees (COE) during 2022/23.

Of the R4 billion for COE, half will go to the Administration Programme (R2 billion), which also has the highest staff complement of 3 536 employees (inclusive of 749 vacancies).

The Administration positions constitute 46 per cent of the Department’s approved total staff complement of 7 629 positions.
The latter total includes 1 504 vacancies (19.7 per cent vacancy rate) for the entire Department.

Table 3: Medium-Term Expenditure Framework including 2021/22 Adjusted Appropriation Programme/Branch 1.
Administration 2021/22 R’000 2022/23 R'000 2023/24 R'000 2024/25 R'000 2 904 058 71 820 153 050 3 562 423 66 968 145 073 3 676 732 59 739 126 997 3 756 885 69 620 139 401 Ministry Department Management 4 47 Internal Audit 60 092 57 672 51 167 55 939 Financial Management 297 853 821 827 537 239 962 177 2 613 010 Corporate Services Provincial Operations Office Accommodation 2.
Agricultural Production, Biosecurity & Resources Management 266 123 1 022 893 1 302 302 701 392 2 501 203 231 217 841 520 1 398 183 967 909 2 403 287 Inspection and Quarantine Services Plant Production and Health Animal Production and Health Resources and Disaster Management Biosecurity Agricultural Research Council 3.

Food Security, Land Reform & Restitution Food Security & Agrarian Reform Land Redistribution and Tenure Reform Nat.

Ext.
Ext.

Services & Sector Capacity Development Land Dev & Post Settlement Support Commission on Restitution of Land Rights Restitution Agricultural Land Holdings Account Ingonyama Trust Board Office of the Valuer-General 4.

Rural Development National Rural Youth Service Corps (NARYSEC) Rural Infrastructure Development Technology Research and Development 5.
Economic Development, Trade & Marketing International Relations and Trade Cooperatives Development Agroprocessing, Marketing & Rural Industrial Dev National Agricultural Marketing Council 6.
Land Administration National Geomatics Management Services Spatial Planning and Land Use Management Deeds Registration South African Council of Planners South African Geomatics Council Integrated Land Administration Total 470 287 162 901 350 342 342 667 4 181 1 282 632 9 806 538 3 070 465 949 009 575 003 612 564 - Source: DALRRD – Annual Performance Plan 2022 – Overview of the 2022/23 Budget Allocations and Programme Performance Plans 3.3.1 Programme 1: Administration 5 48 The Administration Programme provides strategic leadership, management and
 support services to the Department.
It received 20.6 per cent of the Department’s total budget, which is an increase of approximately 5 per cent from the prior year and the second largest allocation of the Department’s total appropriation for 2022/23.

For a Programme that receives the second largest appropriation from the Vote and where 46 per cent of the Department’s personnel are located, the performance targets for the Administration Programme are not aligned with the financial resources allocated.
Approximately 57 per cent (R2 billion) of the Administration Programme’s total budget will go to compensation of employees.

The Programme has only two targets, viz.

attaining an unqualified audit opinion on financial statements and paying 100 per cent of invoices within 30 days, a target it failed to achieve in the past two years.
As Administration is responsible for strategic leadership, management and support services to the entire Department, more specific performance indicators would have been expected particularly for the Provincial Operations and the Corporate Services sub-programmes that both receive the lion’s share of the Programme’s budget for the year under review.
As illustrated on Table 3, the Provincial Operations sub- programme is allocated approximately 37 per cent of the Administration budget followed by Corporate Services, which accounts for approximately 29 per cent of the Programme budget.
For the Provincial Operations sub-programme that receives the largest allocation of the Programme’s budget, specific targets would have been expected in respect of strengthening monitoring and evaluation (M&E) of projects that are implemented by provinces and other service providers, a weakness that has also been previously acknowledged by both the Committee and the Executive Authority.
The Committee emphasised a need for stringent M&E mechanism with a renewed focus on project management, including monitoring of utilisation of grant funding awarded to projects as well as assessment of the socio-economic impact of programmes and projects funded by the Department.
For the Corporate Services sub-programme, renewed focus on legislative and policy review, initiatives to address lack of consequence management and strengthen internal control deficiencies and other audit findings that have been highlighted by the Auditor-General of South Africa in previous years.
3.3.2 Programme 2: Agricultural Production, Biosecurity and Resources Management 6 49 The purpose of this Programme is to oversee livestock production, game farming, animal and plant health, natural resources and disaster management.

Programme 2 received the third largest allocation of approximately R2.5 billion (Table 3), which is R1 billion less than Administration; and approximately 14 per cent of the total Vote appropriation.
Despite its important role in promoting agricultural production, managing biosecurity and sector related risks, plant and animal diseases and pests including disasters, Programme 2’s budget allocation has been stagnant and will further decline by an average of 1 per cent over the MTEF period.

Approximately 47.5 per cent of the Programme’s budget is the Parliamentary Grant transfer to the Agricultural Research Council (ARC).
In terms of the sub-programmes, the Quarantine and Inspection Services sub-programme receives 18 per cent of the Programme’s total budget, which is the second largest allocation within the Programme after the ARC (Table 3).

However, allocations to the ARC and the latter sub- programme will also be impacted by the decline in the Programme’s budget allocation over the MTEF period.
While the focus on Biosecurity as a sub-programme was welcomed in the previous year, there was, and there still is, a concern with the small budget allocation of R3.3 million (0.1 per cent of the Programme 2’s total allocation) in light of the continuing disease outbreaks particularly the foot- and-mouth disease (FMD), which is costing the livestock industry significant losses in export revenue.
There also plant pests outbreaks such as fall armyworm and brown locusts that are not included in the APP for surveillance; as well as the recent outbreak of Avian influenza (flu), which has a negative impact on the growth and sustainability of the poultry industry.

Both FMD and Avian flu have a negative and significant impact on sector employment and job creation.
In light of the frequency of climate change related natural disasters, a significant budget allocation was expected for the Resources and Disaster Management sub-programme, which plays a central role in the implementation of policies and frameworks to mitigate disasters in rural and agricultural areas.

There is a concern with the MTEF decline in the allocation to the latter sub-programme, which received R287 million (approximately 11.5 per cent of Programme 2’s total budget) for the 2022/23 financial year.
3.3.3 Programme 3: Food Security, Land Reform and Restitution 7 50 Programme 3, is responsible for acquisition and redistribution of land, as well as promotion of food security and agrarian reform, thus playing an important role in contributing to economic transformation and job creation (Priority 2 of the MTSF).

The Programme received the largest allocation of R8.99 billion, which is 52 per cent of the Department’s total appropriation.
Approximately R7.6 billion of Programme 3’s total appropriation, which is equivalent to 85 per cent of the Programme’s total budget, is for transfers to provinces, entities and households.

Of the transferred R7.6 billion, approximately R3.7 billion is for households, which covers grant funding for land acquisition and farmer development support; R2.4 billion will go to other provincial and municipal transfers; R1 billion to Departmental agencies and accounts while R400 million will go to the Land Bank.
The Restitution sub-programme, as discussed in detail in Section 4.1 of this report dealing with the Commission on Restitution of Land Rights, has been allocated R3.7 billion.

It accounts for approximately 41 per cent of Programme 3’s total budget, followed by the Food Security and Agrarian Reform sub-programme, which received R2 billion (23 per cent).
As Table 3 shows, the allocation to the Food Security and Agrarian Reform sub-programme is declining over the MTEF period, in real terms (when taking inflation into account), the sub- programme will realise a 10.5 per cent decline in budget allocation.

The stagnant budgetary growth and especially the decline in the MTEF period for the Food Security and Agrarian Reform sub-programme remains a disappointment and a concern.
This is in light of the continuing hunger situation that has been compounded by the Covid-19 pandemic and climate related disasters as most people have lost sources of income and other livelihood means.
Another area of concern is that despite its mandated contribution to the implementation of the National Food and Nutrition Security Plan, the Department’s APP lacks a framework or a clearly defined indicator to measure food security but the Department relies on quantitative targets that are implemented by provinces in the form of producer support programmes (conditional grants) without measuring the actual impact of such programmes on food insecurity.
Conditional grants in this regard, will receive a combined allocation of approximately R2.2 billion (R1.6 billion for Comprehensive Agricultural Support Programme (CASP) and R610 million for Ilima/Letsema).

Of the R1.6 billion that will be allocated for CASP, approximately R1.2 billion is for infrastructure and the rest is for Extension Recovery Planning (ERP) and revitalisation of Agricultural Colleges.
8 51 In the previous financial year, the Committee welcomed the reported re-launch of the Blended Finance Initiative (BFI) with the Industrial Development Corporation (IDC) as well as interest from commercial banks that was pronounced by the Executive Authority.

However, the Committee then raised concern with the involvement of commercial banks in light of stringent requirements and higher interest rates, which are out of reach of smallholder farmers.
It further emphasised reporting on the BFI and accounting for funds that have been transferred to the Land Bank.

The Committee is yet to receive the detailed reports on both the BFI and funds transferred to the Land Bank; and further, the current APP still has no performance indicators or targets to that effect.
Despite the Department’s previous reservations about the Land Bank’s financial challenges and experience with the implementation of the BFI including lack of accountability on transferred funds, it continues to transfer funds to the Land Bank.

In the current financial year, R400 million will be transferred to the Land Bank through Programme 3.

For the medium term period ending in 2025, a combined total of approximately R1.2 billion will be transferred to the Land Bank.
Expanding access to land is vital for the government’s efforts to reduce hunger and provide people with meaningful land-based livelihoods, especially smallholders and subsistence farmers.

It is anticipated that the process will be boosted through the Expropriation legislation which, at the time of writing this report, was going through parliamentary processes and expected to be approved by the end of 2022.
Taking cue from the government key priorities, the 2022/23 APP demonstrates a renewed focus on fast-tracking the delivery of land by settling restitution and labour tenants’ claims as well as provision of adequate post-settlement support over the medium-term.

The proposed Land and Agrarian Development Agency (LARA), to be established in this financial year, will play a crucial role in coordinating land reform and related programmes.
The Department has planned to deliver, in 2022/23, the following: • A total of 585 CPAs will be supported to be compliant with the Communal Property Association Act (No 28 0f 1996).

A focus on supporting CPAs is always a welcome commitment.

However, the Committee expressed concern that 585 was a minor increase of eight compared to the target of 577 in the 2021/22 and there were many CPAs that were either dysfunctional, in distress or have completely collapsed.
Further, there is little information in the plans about the CPA Amendment Bill which was approved by Parliament but not signed 9 52 into law by the President.

It thus means that the support mechanisms included in the amendments remain unimplemented.

• Through the Proactive Land Acquisition Strategy (PLAS), about 35 182 ha of strategically allocated land will be acquired, a slight increase compared to 33 777 ha targeted for acquisition in 2021/22 and to further increase in 2023/24 and 2024/25.
About 50 per cent of the land to be acquired would be allocated to women, 40 per cent to youth, and 10 per cent to people with disabilities in line with the Beneficiary Selection Policy.

• Acquisition of 34 043 hectares of land for farm dwellers and/or Labour Tenants or ESTA occupiers in 2022/23, which is expected to increase gradually from 2023/24 and 2024/25.
• About 83 farms will be supported through the Land Development Support Programme (LDSP), a decrease of 63 compared to 146 farms that were supported in 2021/22.

The number increases to 82 and 80 in 2023/24 and 2024/25.

Whilst there is a drive to increase the amount of land delivered, LDS does not match the land delivery rate.

• The Department will allocate 34 043 ha of State land for land reform, gradually increasing to 37 543 ha in 2024/25.
3.3.4 Programme 4: Rural Development Under Programme 4, the Department facilitates rural development strategies for socio-economic growth with an ultimate goal for an integrated and inclusive rural economy.

The Department is expected to create integrated and inclusive rural economies with quality basic services, particularly education, health care and public transport.
The budget allocation for rural development has decreased by 23,8 percent from the adjusted appropriation of R1.08 billion in 2021/22 to R821.4 million in 2022/23.

The allocation to the NARYSEC sub-programme decreased by 41.4 per cent in nominal terms in 2022/23 compared to 2021/22.
The largest share of the budget for the 2022/23 financial year is allocated to the Rural Infrastructure Development sub-programme, which accounts for 82.5 per cent of the total budget under this Programme, indicating commitment to contribute to the government’s priority of infrastructure development in rural areas in support of farmers and improved service delivery.
The programme performance targets for 2022/23 are as follows: 10 53 • NARYSEC will train 699 young people in 2022/23, a decrease by 710 youth when compared to the target of 1 409 in 2021/22.

With the noted decrease over the MTEF period, it means that the commitment to create job opportunities for the young people will be negatively impacted.

• Completion of 69 infrastructure projects in 2022/23 to support rural economic transformation.
This is a decrease compared to 75 rural projects that were targeted for completion in 2021/22.

3.3.5 Programme 5: Economic Development, Trade and Marketing The purpose of this Programme is to promote economic development, trade and market access for agricultural products; and foster international relations for the sector.

Programme 5 received the smallest budget allocation of R698.7 million (4 per cent of the total Vote) for the 2022/23 financial year.
Approximately R441.6 million (63 per cent of the Programme’s total budget) will be allocated to the Agroprocessing, Marketing and Rural Industrial Development sub-programme and R138.5 million to the International Relations and Trade sub-programme (20 per cent).

The R48.5 million Parliamentary Grant transfer to the National Agricultural Marketing Council (NAMC) also takes place through this Programme.
One of Programme 5’s objectives is to provide for the transfer of marketing skills to small and medium agroprocessing entrepreneurs.

However, although approximately 63 per cent of Programme 5’s budget will go to the Agroprocessing, Marketing and Rural Industrial Development sub-programme, there are no specific targets that directly speaks to the objective in respect of agroprocessing.
This is notwithstanding that the NDP expects the agricultural sector to create 1 million jobs by 2030 through agroprocessing.

For the target on AgriBEE Fund applications that will be finalised, which is based on a percentage, there is no baseline to provide an indication of how many applications does the Department normally receives and finalise in a year, based on previous experience.
This is important as a measure of its transformation interventions given that some previously disadvantaged producers are not aware of the AgriBEE Fund or how to apply for it.

In addition to what will be allocated to the Land Bank under Programme 3, the Department will transfer an additional R49 million to the Land Bank under this Programme for the current financial year, which is more than the previous year’s R40 million that was transferred to the Land Bank through Programme 5.
11 54 3.3.6 Programme 6: Land Administration This Programme is responsible for provision and maintenance of an inclusive, effective and comprehensive system of planning, geospatial information, cadastral surveys, legally secure tenure, and land administration that promotes social, economic and environmental sustainability.

The budget allocation for land administration decreased from an adjusted appropriation of R762.6 million in 2021/22 to R708.6 million in 2022/23.
The Deeds Registration Sub-programme generates its own revenue from selling information on deeds registration and does not receive any allocation from the Department.

The largest share of the allocation of programme 6 goes to the National Geomatics Management Services Sub-programme, 71.6 percent in 2022/23.

Together, the National Geomatics Management Services and Spatial Planning and Land Use sub- programmes receive 98.6% of the total allocation to the Programme.
These are a crucial sub- programmes for improved land administration and spatial planning for integrated development.

The 2022/23 targets to contribute to spatial transformation are as follows: • Completion of phase 1 of the e-DRS (75 per cent is estimated to have been completed in 2021/22) and phases 2, 3 and 4 will be completed by 2024/25.
This transition to electronic lodgement and registration is aimed at enhancing efficiency in deeds registration and improvement in the turn-around times for delivery of title deeds.

• Produce implementation report of the National Spatial Development Framework (NSDF).

• The Deeds Registries Amendment Bill and memorandum on the Bill to be submitted to the Minister for submission to the Cabinet in 2022/23.

4.
4.

Overview of the Strategic Focus of the Public Entities of the Department, their 2022/23 Annual Performance Plans and Budget Allocation The Department, as discussed above, oversee the operations of a number of national public entities of different status.

For example, the status of the Commission on Restitution of Land Rights is currently under review with intension to ensure that it is fully autonomous as envisioned in the founding legislation.
Table 4 below illustrates budget allocation for each entity.

12 55 Table 4.

Budget Allocation to Entities for the MTEF Period 2022/23 – 2024/25 Entity 2021/22 MTEF Period Estimates R’000 Adj.

Approp.

2022/23 2023/24 2024/25 1.

Commission on Restitution of Land Rights 2.

Ingonyama Trust Board - 23 517 20 680 24 391 18 371 23 781 17 665 24 849 3.

Office of the Valuer-General 131 844 107 171 155 271 162 244 4.

Agricultural Land Holdings Account 937 986 965 860 984 942 1 029 175 5.
Agricultural Research Council 1 282 632 1 189 320 1 191 556 1 245 068 6.

Onderstepoort Biological Products - - - - 7.

National Agricultural Marketing Council 46 944 48 535 49 771 52 006 8.
Perishable Products Export Control Board - - - - Total 2 422 923 2 355 957 2 423 692 2 531 007 Source: DALRRD – Annual Performance Plan 2022 - 2023 4.1 The Commission on Restitution of Land Rights (CRLR or the Commission) The CRLR was established as an autonomous institution by the Restitution of Land Rights Act, 1994 (Act No.

22 of 1994).
22 of 1994).

Restitution, as a sub-programme of Programme 3: Food Security, Land Reform and Restitution of the Department, is mainly implemented by the Commission whose mandate is to solicit, investigate and attempt to resolve land claims through registration and /or mediation or otherwise to refer the claims for adjudication to the Land Claims Court (LCC).

By September 2021, a total of 82 295 claims were settled, benefiting 2.2 million beneficiaries comprising 444 057 households.
The extent of the land acquired and restored to land claimants is 3.8 million ha, costing R24.4 billion.

The total number of land claims outstanding as at January 2022 was 6 907 comprising 5 829 pure outstanding claims and 1 078 phased outstanding claims, mostly rural land claims in KwaZulu-Natal, Mpumalanga and Limpopo.
The Commission has set itself three targets for the 2022/23 financial year, namely: • Settlement of outstanding claims (pre-1998 or old order claims): There are about 6 907 outstanding claims, and the Commission plans to settle 1 125 land claims over the medium term.

Although the number of claims to be settled has increased in 2022/23 and 2023/24, i.e.
336 and 549 respectively, when compared to 240 in 2021/22, it might take more than a decade 13 56 to settle all old order claims (provided that the commission continue to operate at the planned rate of performance, and given budgetary and capacity constraints).

• Finalisation of settled land claims (old order land claims): The number of claims to be finalised over the medium term are 1 237, 372 of which will be finalised in 2022/23.
This means that the number of claims to be finalised in 2022/23 has increased compared to the target of 316 claims that were targeted to be finalised in 2021/22.

Whilst the increase is welcome, same concerns about the pace and the time to be taken for finalisation of claims remain.
The expected MTEF cost drivers in restitution are the acceleration of the settlement and finalisation of claims, including the clearing of the commitment register, and implementation processes towards attaining the autonomy of the Commission.

The operational budget for the Commission in 2022/23 is R20.7 million.

Household budget (for settlement and finalisation of claims, and development grants) for 2022/23 is R3.1 billion.
The total allocation for Restitution is R3.7 billion, which is a marginal increase compared to the adjusted allocation of R3.5for 2021/22.

The independent financial forecasting conducted under project Kuyasa indicated that an estimated amount of R65 billion is needed to settle all outstanding old order claims while an estimated R129 billion is needed to settle and finalise all outstanding old order claims.
The commitment register currently stands at R5.2 billion, of which R2.4 billion or 46 per cent is in respect of development grants while 54 per cent is for land acquisition and financial compensation, i.e.

a reduction from R5.7 billion in 2021/22 to R5.2 billion in 2022/23.

Therefore, the current allocation of R3.7 billion is inadequate to allow for settlement of all outstanding claims within the shortest time possible.
4.2 KwaZulu-Natal Ingonyama Trust Board (ITB) Section 2(b)(2) of the Ingonyama Trust Act, with subsequent amendments, provides that “The Trust shall, in a manner not inconsistent with the provisions of this Act, be administered for the benefit, material welfare and social well-being of the members of the tribes and communities as contemplated in the KwaZulu Amakhosi and Iziphakanyiswa Act, 1990 (Act No.
9 of 1990) …” With this in mind, the Trust seeks to become a leader in sustainable communal land management (Its vision).
Its mission is to: (i) contribute to the improvement of the quality of life of the members of the traditional communities living on Ingonyama Trust land by ensuring that land management 14 57 is to their benefit and in accordance with the laws of the land; and (ii) to develop progressive and radical business and land tenure models for the social and economic upliftment and the empowerment of the members of traditional communities who are beneficiaries of land owned by the Trust, and administered by the Ingonyama Trust Board (ITB) on behalf of the Trust.
The ITB has two programmes; namely, Administration and Land and Tenure Management programmes.

The ITB did not officially table any budget allocations in the APP.

The Committee could not ascertain the amount of the transfers from the Department, what, and how, it would be spent on; total estimated revenue to be generated by the Trust and a portion of the revenue to be utilised for the material benefit of communities living on the Trust land.
The Committee could not assess whether there was adequate financial capacity to deliver on targets set in the APP.

The Minister of Agriculture, Land Reform and Rural Development was in a process to engage the ITB to assist them table the budget.

4.3 Office of the Valuer-General (OVG) The Office of the Valuer-General (OVG) was set up in terms of the Property Valuation Act (PVA), No.17 of 2014.

It is listed as Schedule 3A public entity in terms of the Public Finance Management Act (PFMA), Act No.1 of 1999.
The Office of the Valuer-General (OVG) is responsible for the following: (i) valuation of properties identified for land reform purposes, as well as where a Department requests for a valuation service to be rendered for purposes of acquiring or disposing of property; and (ii) developing criteria and procedures for the valuation of a property that has been identified for land reform purposes and monitoring the proper, efficient and effective valuation of such properties based on set criteria and procedures.
Its work ensures that the compensation determined for land acquisition for land reform purposes is just and equitable.

It is thus seen as an institution that could assist to fast track land reform through provision of a credible valuation.

Over the last two years, there was a process to review the PVA and the work of the OVG, led by the Ministerial Advisory Panel on Land Reform (MAP).
It is reported that the MAP has completed its work in reviewing the PVA and submitted the Report to the Minister for consideration.

15 58 The OVG receives transfers from the Department through Programme 3 (Food Security, Land Reform and Restitution) to cover the cost of land reform valuations.

The total allocation for the OVG in 2022/23 is R107.2 million, a decrease of 18.7 per cent compared to the allocation of R131.8 million in 2021/22.
However, the transfers are expected to increase to R162.2 million in 2024/25.

Of the R107.2 million transferred to the OVG in 2022/23, R11.1 million (10.4 per cent) is for the Administration Programme, R43.1 million (40.2 per cent) is for valuations and R53 million (49.4 per cent) is for operations.

In terms of economic classification, a large portion of the budget allocated to the Administration Programme is for compensation of employees (COE).
There has been a noticeable increase in the allocation for Goods and Services under the Valuations Programme, which is expected to increase by 376.7 per cent in nominal terms in 2022/23 compared to 2021/2, while the allocation for COE is expected to decrease by 51.9 per cent.

The OVG has structured its expenditure into three programmes, namely Administration, Valuations and Operations.

Its main priority in 2022/23 is to improve its capacity and reduce valuations backlog.
Programme priorities are as follows: • • Under Administration, comprising governance, risk and compliance; and internal audit, the department aims to implement the corruption and fraud prevention mechanism.

Valuations, focusing on credible valuations in line with the PVA, is expected to deliver on the following targets over the medium term: o o o To complete all valuations requested by clients within the specified times.
The Committee noted that there has been an improvement in the performance, from 93 per cent achievement in 2020/21 to 100 per cent in 2021/22.

The average number of days to issue a valuation certificate should not exceed 50.

The average number of working days to resolve queries after issuing of final valuation certificate should not exceed 10.

• Operations provides business function services to the entire organisation.
It is divided into five sub-programmes; namely Project Management Office (PMO), Human Capital Services; Strategy and ICT Services; Financial Management Services; and Supply Chain Management.

Its main targets include the following: an approved implementation plan for the MAP recommendations and to fill 70 funded posts filled in line with the approved interim structure, which is an additional three to the number of posts filled in 2021/22 (67).
16 59 4.4 Agricultural Research Council (ARC) The ARC was established in terms of Section 2 of the Agricultural Research Act, 1990 (Act No.

86 of 1990).

It is listed in the PFMA as a Schedule 3A national public entity.

The ARC is the principal agricultural research institution in the county.

It provides agricultural research and development, technology transfer and support to the agricultural community.

In addition, the ARC is the custodian of the country's national collections of biological assets.
For the 2022/23 financial year, the ARC has been appropriated an amount of R1.2 billion through the Department’s Programme 2.

The transfer constitutes baseline allocation for operational expenditure and capital expenditure.

The Parliamentary Grant (PG) has been declining over the years and in the current MTEF period ending in 2025, the entity will realise a 7 per cent decline in the PG.
Due to the constrained national fiscus, from the previous financial year onwards, the ARC has not been expecting the additional funding it used to receive from the Department of Science and Innovation (DSI).

The entity’s budget process is based on zero-based budgeting principles i.e.

all expenses must be justified for each new period and every function is analysed for its needs and costs.
Personnel costs remain the highest cost driver, constituting 48 per cent of total expenditure for 2022/23, and approximately 69 per cent of the Parliamentary Grant.

The entity’s operational costs continue to surpass the operational revenue and the ARC plans to address the challenge by enhancing external income and reducing the cost of doing business.

The ARC’s key strategic projects are: • Optimisation of personnel costs for which R60 million has been budgeted.
• Benchmarking of salaries, which is not budgeted for and not affordable.

• The Turnaround Strategy for which a budget of R32 million has been set aside.

This will also include the Commercialisation Strategy, which will be funded with R11.3 million from the aforementioned R32 million.

• The amalgamation of Pretoria campuses, which is not budgeted.
For the medium term, the ARC will be focusing on meeting the Medium Term Strategic Framework (MTSF) Priorities through six Outcomes that are aligned with the MTSF Priorities.
17 60 Some of the key activities that will be undertaken under the entity’s 9 Programmes that are located within its different Business Divisions include: • Developing new cultivars/varieties with improved desired characteristics, namely high yield, improved quality and improved nutritional quality, resistance/tolerance to biotic and abiotic stresses and adaptation to different environments and growing conditions; considering the needs of producers, processors and consumers.
• Biosecurity – Development of risk management and mitigation methods for crop production that includes the plant health research and services, climate mitigation research and services, genetic purity testing and services.

• Post-harvest management and product development for decreased food waste and longer shelf life; and agroprocessing of fruit, vegetables, medical plants, herbs, teas into various products.

• Genomic selection and genomic assisted breeding in crop and livestock improvement.
• Provide much-needed analytical services to national, provincial and local government and clients in the food and feed industry through its SANAS accredited laboratories.

The services include product, chemical, microbiological and physical tests on feed and food samples.

The Committee appreciated the work of the Board including the appointment of the CEO.
However, there was a concern regarding the impact of executive management vacancies at Human Resources; Impact and Partnerships and the recently vacant position of the Chief Financial Officer (CFO) and the strategic project that were not budgeted for.
Funding constraints and personnel capacity particularly balancing optimisation of personnel costs with job losses while the entity on one hand was highlighting the need to appoint high-profile scientists who can generate external revenue were recognised as areas needing attention.

In light of the frequency and ongoing FMD outbreaks, the slow pace of the establishment of the FMD Facility remains a major concern particularly as funding allocation for the Facility was first made in 2018/19.
However, the prioritisation of the FMD Facility including the establishment of the Task Team by the Board to address FMD challenges was welcomed.

4.5 The Onderstepoort Biological Products (OBP) 18 61 The OBP was established in terms of the Onderstepoort Biological Products Incorporation Act, 1999 (Act No.19 of 1999).

It is listed under Schedule 3B of the PFMA i.e.

National Government Business Enterprise.

It is governed by Act No.


19 of 1999, which should be read together with the Onderstepoort Biological Products Memorandum of Incorporation (MOI); and was declared as a National Key Point in 2007.

The OBP is a state-owned bio-technical company that manufactures animal vaccines and related products for the global animal health care industry.

The entity does not get a financial transfer from the Department but funds all its operations from its self-generated revenue, mostly from sale of vaccines.
The entity’s total budget for 2022/23 is R166 million.

Challenges with aged equipment breakages meant that the OBP suffered revenue losses in the past few years as it could not timeously produce some of the required vaccines.

The main focus remains ensuring a steady supply of vaccines and continued work on the modernisation of the vaccine manufacturing plant i.e.

the good manufacturing practice (GMP) Facility.


Therefore, a significant proportion of the entity’s budget will go towards production operations and revenue generation with approximately 59 per cent of the budget allocated to the Continuous Improvement of Business Operations Programme and 20 per cent to the Financial Stability Programme.
Some of the challenges that were highlighted by the Board of the OBP including solutions include: • People within the organisation - ongoing labour disputes that the Board inherited when it started its term in November 2020.

Training of personnel and fostering engagements with unions is ongoing.

• Market share challenges – safeguarding the OBP’s Intellectual Property (IP) as some competitors are entering markets with unregistered vaccines.
OBP is working with the ARC attorneys in defining and safeguarding IP.

• Production – old and aged infrastructure resulting in regular breakdowns; water and electricity interruptions.

To address the challenges, the entity has developed a 7-year CAPIN Plan; planning on utilities jointly with the ARC’s Onderstepoort Veterinary Research Institute (OVR), which is located adjascent to the OBP and also got the Council for Scientific and Industrial Research (CSIR) involved.
19 62 • Protection of information – leakage of information including theft of information and documentation.

The Board has requested the State Security Agency (SSA) to vet the entire staff complement.

• GMP Project – delays in project completion.

The Board and management are addressing contract management and have instituted an investigation of role players.

• Governance – outdated policies and procedures.


Review and development of policies has been prioritised for presentation to, and approval by, the Board in accordance with the Board and Sub-committee work plans for 2022/23.

The OBP further reported that, of the initial once-off allocation of R492.4 million that was allocated in 2013/14 for the GMP Project, R71 million is remaining while the project is far from being completed meaning that additional funding will be required to finalise the GMP Project.
The lack of progress in the modernisation of the vaccine manufacturing plant (GMP) project, equipment breakages that affect vaccine production and availability, historical procurement and contract management challenges, as well as the entity’s personnel challenges including leakage of information were of major concern to the Committee.
It acknowledged the interventions that have been introduced by the Board to address the numerous challenges within OBP including plans to appoint a new CEO and the measures to investigate and criminally charge transgressors and those involved in fraud and corruption.

4.6 The National Agricultural Marketing Council (NAMC) The NAMC was established in terms of Section 3 and 4 of the Marketing of Agricultural Products Act, 1996 (Act No.

47 of 1996) as amended by Act No.

59 of 1997 and No.

52 of 2001.


It is listed under Schedule 3A of the PFMA.

The core mandate of the NAMC is to advise the Minister of Agriculture, Land Reform and Rural Development on agricultural marketing policies and their application, advise the Minister on statutory measures and undertakes research, on its own accord or as directed by the Minister on agricultural marketing policy in relation to national economic, social and development policies and international trends and developments.
It also coordinates work relating to the statutory measures as mentioned in the Act and the work of Agricultural Industry Trusts.

20 63 For the 2022/23 financial year, the NAMC has a total budget of R51.2 million which comprised of the Parliamentary Grant of R48.5 million that has been transferred through Programme 5 of the Department and R2.7 million from its own revenue (bank interest and project management fees).
Approximately 67 per cent of the entity’s total budget will go to compensation of employees and 33 per cent to goods and services.

In order to streamline activities and strengthen its legislative mandate, the entity has undertaken a review of its organisational structure.
However, it highlighted that available funding is not sufficient for operational (for example, traveling to farmers as it expands its footprint to all provinces) and administrative expenses including the additional positions on the approved new structure.

Therefore, the entity is working on a Resource Mobilisation Strategy to ensure its financial stability.
In addition to its legislated core mandate, the NAMC was appointed in 2019 by the Minister of Agriculture, Land Reform and Rural Development to coordinate the process of compiling the Agriculture and Agroprocessing Master Plan (AAMP).

The Master Plan has since been finalised and will be launched on 12 May 2022.

For a period of 10 years, the NAMC will be involved in the monitoring and evaluation (M&E) of the implementation of the AAMP.
The Committee welcomed the NAMC’s improved Annual Plan as previous matters that were raised by the Committee have been addressed but questioned the rationale for expanding its organisational structure when it does not have funding for additional posts.
The Committee further appreciated expansion of some of the NAMC’s activities in provinces, where farmers have limited or no access to markets; and raised a concern regarding coordination of activities between the NAMC and the Department in identifying farmers that need support on market access.

4.7 Perishable Products Export Control Board (PPECB) The PPECB was established in terms of Section 2 of the Perishable Products Export Control (PPEC) Act, 1983 (Act No.

9 of 1983).
9 of 1983).

In addition to the PPEC Act, it is also governed by the Agricultural Product Standards (APS) Act, 1990 (Act No.

119 of 1990).

It is listed under Schedule 3A of the PFMA.

The PPECB does not receive a Parliamentary Grant but generates its own 21 64 revenue through fees and levies charged for inspections done on perishable products that are due for export and issuance of export certificates.

Its total budget for the 2022/23 financial year is R588.3 million.
In terms of economic classification, due to the nature of the PPECB’s operations, approximately 68 per cent of its budget is spent on compensation of employees.

In terms of Programmes, 63 per cent of the budget is allocated to the Statutory Operations Programme while 25 per cent goes to Corporate Services.
The PPECB also introduced additional strategic projects to focus on Women in Leadership, People with Disabilities and a digital programme called Intellex (to assist producers with identifying potential export destinations).

The Committee commended the PPECB for its clear and well- articulated Annual Plan, the continued good work and the role that it plays in the export of perishable products from South Africa including capacity building of smallholder farmers for export market access.

5.
Summary of Key Conclusions drawn from the Committee Deliberations on the 2022/23 APPs and MTEF Budget of the Department (DALRRD) and its Entities The Committee, having deliberated the findings and observations on the 2022/23 APPs and budget allocations of the Department and Entities, drew the following conclusions: 5.1 The Department of Agriculture, Land Reform and Rural Development 5.1.1 Whilst being cognisant of the fiscal constraints of the country, the overall decline in the Department’s overall budget allocation over the MTEF period and particularly budget reduction in key departmental Programmes such as Agricultural Production, Biosecurity and Resources Management (Programme 2) and Food Security, Land Reform and Restitution (Programme 3) are contrary to the Department’s aim and strategic focus for the medium term; and could potentially undermine service delivery in respect of the Department’s NDP mandate and MTSF priorities.
The miniscule budget allocation to the Biosecurity sub-programme in Programme 2 remains a concern in light of the continuing 22 65 FMD challenge and most recently, avian influenza.

Both diseases have a negative impact on export revenue, sector employment and sustainability.
5.1.2 The reduction in the Department’s overall budget during the MTEF period also negatively impacts transfers to entities such as the ARC, which is not adequately funded given its essential role in ensuring up to date agricultural research and innovation to address imminent sectoral challenges that include climate change related high temperatures, water shortages, disease outbreaks and new pests; as well as impact of global trade competition to the agricultural sector.
5.1.3 There is misalignment between financial resource allocation and performance targets among and within Departmental Programmes.

As an example, the Administration Programme, which also has a largest staff complement, receives a larger budget than the more technical Programme 2 that is central to agricultural production, health and safety of agricultural products, resource conservation and management as well as disaster management.
Despite its strategic role and large budget, Administration has two targets and 57 per cent of its budget goes to compensation of employees.

5.1.4 Considering that more than half (53 per cent) of the total Budget Vote goes to transfers and subsidies in the current financial year, specific targets to strengthen monitoring and evaluation (M&E) would have been expected under the Administration’s Provincial Operations sub-programme.
Weak M&E in the Department remains a challenge and will continue to affect accountability on transferred funds including the assessment of interventions that are implemented by provinces and other service providers (e.g.

farmer support and food production programmes, infrastructure development, capacity development programmes, etc.).
5.1.5 The need for further engagements on the Blended Finance Initiative (BFI), which is mentioned in the APP but and the National Treasury’s Estimates of National Expenditure (ENE) for the Vote, but with no specific targets in the APP.
Engagements should include the Commercialisation of Black Producers Programme, for which BFI was established, 23 66 other Departmental funding programmes as well as sector transformation instruments such as the AgriBEE Fund and Mafisa, which were historically administered by the Land Bank.

This should include an update on all funds that have been previously and currently transferred to the Land Bank through Programmes 3 and 5.
5.1.6 Lack of concrete plans in capacitating subsistence and smallholder producers to fully participate and benefit from the Poultry, Sugar and Cannabis Master Plans that have been also cited in the SONA.

With respect to the Cannabis Master Plan, save for the development of an annual report, there is no clear and specific target with an action plan to ensure that indigenous and historical growers of Cannabis (e.g.
in the Eastern Cape and KwaZulu-Natal provinces) are prioritised and capacitated to participate and benefit from the implementation of the Cannabis Master Plan.

5.1.7 The finalisation of the Agriculture and Agroprocessing Master Plan (AAMP) is welcomed and is expected to play a central role in the development and promotion of agroprocessing as well as facilitating market access for the smallholder producers.
5.1.8 While the target on trade negotiations including the Agreement on African Continental Free Trade Area (AfCTA) is important and appreciated, there is a need for clear targets and assessment of interventions to capacitate and assist smallholder producers in particular to fully participate and benefit from such agreements once they become operational.
5.1.9 The Committee noted silences with regard to the target of the number of labour tenants’ applications to settled over the medium-term, thus raising questions about implementation of the Court order and the oversight over the Department by the Special Master for Labour Tenants.

Similarly, targets for implementation of the target for Transformation of Certain Rural Areas Act, (No.

94 of 1998) transfers has been dropped.


It thus means that performance on these crucial areas that addresses tenure security envisaged in Section 25(6) will not form part of reporting on quarterly and annual reports, and can be easily overshadowed by other programmes that have been elevated 5.1.10 An expected increase in the rate of land delivery has not been matched with requisite complementary support services as evidenced by the decline in the number of farms 24 67 supported through LDS.
Inability to match land delivery with complementary support is one of the factors resulting in a decline in land reform farms’ productivity.

5.1.11 The plan lacks demonstrable evidence of implementation of amendments to the Extension of Security of Tenure Act and the Communal Property Association Act, approved by Parliament in 2016 and 2017 respectively.
The Committee, having noted that these important pieces of legislation have not been signed into law by the President, expressed concerns with regard to delays and its impact on target groups/beneficiaries who will continue to suffer from the legislative gaps.

5.1.12 There is lack of clear evidence of coordination of the Rural Development Programme with other government departments.
A particular area of concern was with regard to a link of the work of the Department in the context of the District Development Model (DDM).

DDM was thought to be a great opportunity for area-based approach and addressing communities needs and aspirations holistically.
5.1.13 The decrease in the budget for NARYSEC and other sub-programmes means that the time taken to reach some of the most vulnerable groups in line to be assisted, especially the youth majority of whom are unemployed, will take longer as fewer people will receive the support from this Programme.

5.1.14 The focus on infrastructure development was a welcome development and a step in their right direction.

It has a potential to create jobs and thus improve the livelihoods of communities.
5.2 Public Entities of the Department 5.2.1 Commission (CRLR): Given the ensuing process for research and gazetting of outstanding land claims, there is a room for a margin of error in the R65 billion needed to settle all outstanding old order claims because 43% of the outstanding claims to be researched and claimed properties valued by the Valuer-General.
25 68 5.2.2 The Committee welcomed a process in motion to develop a defined process to determine a more accurate estimate cost related to finalisation of outstanding claims and quantification of the budget for clearing the commitment register.

5.2.3 ITB: Failure of the ITB to table its budget together with the APP was seen as a total disregard of the National Treasury guidelines on the submission of APPs and strategic plans.
It could further be interpreted as a subtle evasion of accountability and transparency by the Ingonyama Trust Board.

Since the Fourth Parliament, the ITB has been given chance to address some of these issues.

However, it appears as situation has regressed with the lowest being failure to present financial report of the Ingonyama Trust for the 2020/21 and Budget for 2022/23.
It calls for honest conversation by all affected and concerned about the importance of the entity, the role it currently plays in land ownership and administration in a democratic South Africa and whether its programmes and current stature is in line with what the legislators envisaged.

5.2.4 OVG: The Committee welcomed the report that the OVG has completed 100 per cent of backlog valuations in 2021/22.
5.2.5 Whilst there are signs of improvement in the performance of the OVG, the offices of the Valuer-General and the Chief Operations Officers were yet to be filled.

These are strategic positions that require urgent attention, and they remain unoccupied, there are risks that the organisation may not stabilise.
It noted that in the past, the Committee had recommended that the Minister prioritise building the capacity of the OVG by filling the vacant positions of the Valuer-General (VG) and the Chief Operating Officer (COO).

5.2.6 Whilst the Moloto matter has demonstrated that compensation may not be market value, it was a concern that the Court did not use the VG calculations.

There is a need for the OVG to seek guidance from the courts on the question of just and equitable compensation.
It noted that property values and compensation were two separate values.

5.2.7 ARC: While the Committee commended the appointment of the CEO to ensure stability at executive management level, it remained concerned regarding the impact of critical vacancies in the ARC particularly the positions of the Group Executive (GE) for Human 26 69 Resources and Management; GE for Impact and Partnerships and the Chief Financial Officer (CFO).
5.2.8 The 7 per cent decline in the Parliamentary Grant allocation to the ARC over the MTEF period was a serious concern.

Funding constraints and personnel capacity particularly balancing optimisation of personnel costs while the entity also highlighted the need to appoint high-profile scientists who can generate external revenue were recognised as areas needing urgent attention.
5.2.9 In light of the frequency and ongoing FMD outbreaks, intervention is required on the slow pace of the establishment of the FMD Facility to develop FMD vaccines, for which the ARC received funding allocation in 2018/19 to enhance the country’s vaccine research capacity and ensure there is a secure local supply of the FMD vaccine.

Dependence on imports for FMD vaccines may be costly and risky to the country’s livestock industry in the long term.
5.2.10 OBP: The Committee appreciated the interventions by the Board of the OBP to address the entity’s numerous challenges that it encountered when it started its term in November 2020.
However, the Committee noted that issues at OBP require urgent intervention from the Executive Authority as the Committee remains very concerned by the extent of the challenges in the National Key Point, which include inter alia the aged infrastructure and frequent equipment breakages, lack of progress on the GMP project, information leakage, IP protection and ongoing labour disputes.
5.2.11 Fast tracking the modernisation of the vaccine manufacturing facility (GMP project) to ensure that the OBP is GMP-compliant and able to be a globally competitive supplier and distributor of vaccines and other biological products remains key.

Lack of progress in the project was flagged for urgent attention as the impact of frequent equipment breakages threatens vaccine production and therefore, the sustainability of the OBP.
5.2.12 The handing over of some cases to the South African Police Services (SAPS) and the Special Investigating Unit (SIU) for further investigation by the OBP’s Board was 27 70 commended to ensure that there are consequences for people who contributed to some of the many challenges in the entity.
5.2.13 The need for additional funding to the OBP specifically to finalise the GMP project was recognised pending completion of investigations and full account of the initial funding that was allocated for the project.
5.2.14 NAMC: Recognition of the NAMC’s plans to expand its footprint to all provinces with respect to facilitation of market access for smallholder producers; and further raised a concern regarding lack of coordination of activities between the NAMC and the Department in identifying and capacitating farmers that need support on market access.
5.2.15 The Committee questioned the NAMC’s rationale for expanding its organisational structure when it did not have funding for the additional positions in the newly approved structure.

5.2.16 PPECB: Appreciation of the PPECB for the clear and well articulated Annual Plan and the continued work in assisting farmers with exports of perishable products and capacity building of smallholder farmers for export markets despite not receiving government financial support.

6.
6.

Committee Recommendations After discussions and deliberations on the 2022/23 Annual Performance Plans (APPs) and Budget of the Department and the Entities (Budget Vote 29), the Portfolio Committee on Agriculture, Land Reform and Rural Development makes the following recommendations to the National Assembly (NA) for the attention of the Minister of Agriculture, Land Reform and Rural Development regarding Budget Vote 29.
The Minister should - 6.1 Liaise with the Minister of Finance to discuss the declining budgetary allocation to the Vote despite the Department’s important mandate in respect of agrarian transformation through land reform, job creation and the important contribution to food security, biosecurity, natural resource and disaster management.
Advocate for increased funding for Programme 2 as 28 71 inadequate biosecurity can pose a threat to food safety and a reputational risk to the country’s agricultural exports.

6.2 Submit to Parliament and present for discussion, the fit-for-purpose organisational structure of the Department, which should clearly illustrate how the merger of the two former Departments addressed duplication of functions among Programmes.
6.3 Submit to Parliament an updated Legislation and Policy Review Programmes with clear time lines and resources for processing and finalisation during the current financial year.

In the case of legislation, submit timeframes for planned introduction to Parliament.
6.4 Submit to Parliament a Human Resource Plan with a specific focus on building and strengthening personnel capacity to address the challenges that were identified and reported by the Department of Public Service and Administration (DPSA) among some senior management service (SMS) level personnel.
6.5 Ensure the development of an Action Plan to review and streamline the Department’s existing support programmes and conditional grants into an integrated Producer Support Programme/Scheme that was envisaged when the National Policy on Comprehensive Producer Development Support was developed to avoid duplication and resource wastage.
The Action Plan should illustrate the alignment to the Department’s new mandate and the Farmer Production Support Units (FPSUs) that are expected to be central to the implementation of the Agriculture and Agroprocessing Master Plan.

6.6 Strengthen Reporting Guidelines and ensure the development of Monitoring and Evaluation (M&E) Frameworks for conditional and other farmer support grants as well as all funds that have been transferred to other service providers (e.g.
Land Bank, infrastructure contractors, consultants) and Entities for the implementation of the Department’s programmes/projects.

The Department should report to Parliament on its M&E activities during each quarterly briefing.

29 72 6.7 Submit to Parliament comprehensive reports on the implementation of the Blended Finance Initiative, transformation activities through the AgriBEE Fund, disbursement of Mafisa loans and utilisation of funds that have been transferred to the Land Bank since 2019/20.
6.8 Submit to Parliament comprehensive reports on the activities (including planned ones) of the Department to facilitate and promote the participation of smallholder producers in the Poultry, Sugar and Agriculture & Agroprocessing Master Plans including M&E of agricultural interventions in respect of the implementation of the Master Plans.

6.9 Provide a progress report on the finalisation of the Cannabis Master Plan including roles and responsibilities of other sector departments.
For the 2022/23 financial year (including outer years of the medium term), the Department has a performance target to “develop an annual report on the implementation of the Cannabis Master Plan”, specify the activities that will be undertaken in 2022/23 towards the development of the annual report on the implementation of the Cannabis Master Plan.
6.10 Submit an Action Plan to fast-track the participation of the agricultural sector in the Trade Agreement on African Continental Free Trade Area (AfCFTA) while ensuring protection of local producers from unfair imports; and also present an Action Plan on capacity building of smallholder producers to enable their full participation in the Agreement on AfCFTA.
6.11 Ensure consistent monitoring of the implementation of the Comprehensive Backlog Reduction Strategy of the CRLR and submit quarterly reports to Parliament, including the financial reports.

6.12 Ensure that the CRLR quantifies the cost of its Commitment Register and develop a three- year plan for clearing the Commitment Register and submit quarterly implementation reports to Parliament.
6.13 Ensure that the CRLR develop and implement a research plan to ensure that all the outstanding land claims are researched by the end of 2022/23, and further present to Parliament quarterly implementation reports.

30 73 6.14 Ensure that the ITB officially tables the 2022/23 budget allocations for both the ITB.
In line with sections 22(1) and (2) of the KwaZulu-Natal Ingonyama Trust Financial Regulations(1998), the ITB must also submit to the Minister a written report on the activities of the Trust during 2020/21 financial year; a report which shall include audited financial statements, reflecting the Trust’s financial affairs during that year for tabling and consideration by the Portfolio Committee.
6.15 Develop an implementation plan for the recommendations of the previous 2021/22 Budget Vote Report and the 2021/22 Budget Review Recommendations Report with regard to the ITB and present implementation reports to Parliament.
6.16 Clear programmes and specific targets for empowerment of youth, women and people with disabilities within the rural communities are streamlined in various programmes of the Department and entities; for example, prioritising them for access to land and productive use of land as well as giving the opportunity for development in the agricultural sector.
6.17 Prioritise engagement with the Ingonyama Trust Board, the Trustee and other relevant stakeholders including the National Treasury and the Auditor-General to address the challenges confronting the ITB, including its mandate and funding, the separation of the ITB from the Ingonyama Trust and its relevance in the current dispensation.
6.18 Motivate for additional funding for the ARC in respect of its important and central role in agricultural research, the agricultural sector competitiveness and contribution to the development of innovations to address the country’s agricultural challenges including natural disasters.

Further ensure the entity fast-tracks the filling of the three vacant executive management positions and other critical vacancies.
6.19 Facilitate the prioritisation of the FMD Facility by the ARC and make sure that it submits to Parliament a detailed Action Plan with timeframes on the development and completion of the FMD Facility.

Further ensure that the Task Team that has been established by the ARC 31 74 Board to address FMD challenges carries out its responsibilities and report on intervention progress on a quarterly basis.
6.20 Strengthen oversight over the OBP and prioritise engagements with the entity while ensuring that the Board and the entity are supported to effectively address the serious challenges that the OBP face.

The current state and security measures in the entity, which is a National Key Point, are of serious concern to the Committee.

Provide quarterly updates to Parliament on interventions to address challenges at OBP.
6.21 Ensure that the OBP fast-tracks the appointment of the CEO and the filling of other critical vacancies to avoid further instability at the entity.

6.22 Ensure that the OBP submits an Action Plan with timeframes and funding needs for the completion of the GMP Facility; and also provides quarterly updates on ongoing investigations and vaccine availability.
6.23 Submit a framework on coordination of activities between the Department and the NAMC including differences between interventions of the Department to those of the NAMC in respect of capacity building programmes for market access for smallholder producers.

The framework should also provide information on targeted commodities, areas/districts of intervention in different provinces and impact of such interventions.
The Committee further recommends that, unless otherwise indicated, within three months after the adoption of this report by the National Assembly, the Minister should submit to Parliament, responses to the above recommendations.

Report to be considered.

32 75 4.
REPORT OF THE PORTFOLIO COMMITTEE ON AGRICULTURE, LAND REFORM AND RURAL DEVELOPMENT ON AN OVERSIGHT VISIT TO THE PERISHABLE PRODUCTS EXPORT CONTROL BOARD (PPECB) AND DISTRICT SIX (D6), WESTERN CAPE PROVINCE ON 29 MARCH AND 01 APRIL 2022, DATED 10 MAY 2022 The Portfolio Committee on Agriculture, Land Reform and Rural Development (hereinafter referred to as the Committee) having undertaken an oversight visit to the Perishable Products Export Control Board (PPECB) and District Six in the Western Cape Province on 29 March and 01 April 2022, reports as follows: 1.
INTRODUCTION The oversight activities of the Committee take cue from section 55(2) of the Constitution which provides that “The National Assembly must provide for mechanism - (a) to ensure that all executive organs of the state in the national sphere of government are accountable to it; and (b) to maintain oversight of - (i) the exercise of national executive authority, including the implementation of legislation; and (ii) any organ of state”.
From these provisions, it is quite clear that the Executive is obliged to account on its actions.

Oversight visits, therefore, constitute a myriad of mechanisms available to the Committee for exercising its constitutional mandate as discussed above.

1.1.
1.1.

Terms of reference for the oversight visit In terms of Section 43(3) and 55(2) of the Constitution as stated above, the Portfolio Committee, as an extension of the National Assembly, holds the Executive accountable through a range of oversight mechanisms.

These sections empower Parliament to scrutinise and oversee Executive action as well as ensuring accountability of all executive organs of state.

As the Committee is overseeing a large Department (i.e.
the Department of Agriculture, Land Reform and Rural Development, hereafter referred to as the Department) with different and complex subject areas, in order to further strengthen its oversight mandate, it realised that briefings were not sufficient to fully understand the mandates and roles of the Department’s various entities.
It thus identified the need to physically visit the various entities of the Department to get a 1 76 better understanding of their operational environments including operational and other challenges.

The PPECB is one of the agricultural public entities that is based in the Western Cape and is responsible for the provision of independent quality certification and cold chain management services for producers and exporters of perishable food products.
It controls the export shipment of perishable produce from South Africa and the order of shipment at all ports; makes recommendations on the handling of perishable produce when moved to and from railway trucks and other vehicles or cold stores; and promotes uniform freight rates for the export of perishable products.

The PPECB also performs inspections and food safety services as assigned by the Department under the Agricultural Product Standards Act, 1990 (Act No.

119 of 1990).
119 of 1990).

Over the last 12 months the Committee has had a series of briefings on the developments at District Six and land restitution progress in the Western Cape province generally.

The decision to visit District Six housing development within the City of Cape Town is part of that process and a direct response to complaints received by the Committee.
The Committee conducted oversight visit in order to gain insights into the complexities of, and the challenges that contributed to, the delays in the completion of phase 3 development of District Six as well as the impediments to the occupation the units, tenure security and title deeds.

The oversight schedule entailed a short briefing on the background and key aspects of the challenges, followed by a walkabout of the delegation guided by officials of the Department and the Commission.
1.2 Objectives of the oversight visit The Committee’s objectives for the visit were to: • Strengthen its oversight mandate by getting an insight into the technical operations of the PPECB through observation.

• Get a better understanding of the PPECB’s operational environment, its role in agricultural exports and challenges thereof.

• Understand the contribution of the services provided by the PPECB to the wider agricultural value chain particularly the agricultural export industry.
2 77 • Monitor implementation of processes for allocation and occupation of dwelling units at District Six as part of oversight on the finalisation of District Six land claims.

Further, to understand the role that the Commission, the Department and the City of Cape Town play in the development of housing at District Six and what each could do to fast-track occupation of the completed units.
• Gain insights into the complexities of construction of dwelling units under restitution, challenges experienced as well as exploring mechanisms to ensure that the Commission speeds up to resolve the complaints that were received by the Committee.
1.3 The delegation and attendance by the Executive The delegation to the PPECB comprised of the Members of the Portfolio Committee on Agriculture, Land Reform and Rural Development as illustrated on Table 1 supported by the Committee support officials responsible for committee secretarial duties, content support and advice, research and logistics.
Also in attendance were relevant officials from the Department of Agriculture, Land Reform and Rural Development; the Ministry of Agriculture, Land Reform and Rural Development, PPECB’s Executive Management and the entity’s Board Member.

The visit to the District 6 Housing Development comprised of Members of the Portfolio Committee as illustrated on Table 2 including Committee support officials as indicated above.
Relevant officials from the Department, the Provincial Shared Services Centre (Regional Land Claims office), the Ministry and the Commission on Restitution of Land Rights were also in attendance.
Table 1: Delegation to the PPECB (Members of the Portfolio Committee) Members of the Portfolio Committee Name MP Mandela, Nkosi ZMD (Chairperson/Leader of the delegation MP Tlhape, Ms MME MP Tshwete, Ms B MP Mahlo, Ms NP MP Mbabama, Ms TM MP Masipa, Mr N (Alternate Member) Political Party African National Congress (ANC) Democratic Alliance (DA) 3 78 Table 2: Delegation to District Six (Members of the Portfolio Committee) Members of the Portfolio Committee Name MP Mandela, Nkosi ZMD (Chairperson/Leader of the delegation MP Capa, Mr N MP Tshwete, Ms B MP Mahlatsi, Ms D MP Mbabama, Ms TM MP Masipa, Mr N (Alternate Member) Political Party African National Congress (ANC) Democratic Alliance (DA) 2.
SUMMARY OF PROCEEDINGS OF ENGAGEMENTS WITH THE PORTFOLIO COMMITTEE This section summarises the engagements that the Committee held with the PPECB, DALRRD and the Commission on Restitution of Land Rights including site visits.

2.1.

Visit to the PPECB 2.1.1.


Briefing by the PPECB The visit to the PPECB started with the introduction by the Chief Executive Officer (CEO) of the Executive Management, the entity’s Board representative, a brief presentation about the PPECB and its mandate as well as a short video on the PPECB’s daily activities and its role on the export of perishable agricultural products from South Africa.
The CEO’s presentation can be summarised as follows: • The PPECB is a Schedule 3B national public entity that is established under the Perishable Products Export Control (PPEC) Act, 1983 (Act No.

9 of 1983) and the Agricultural Product Standards (APS) Act, 1990 (Act No.

119 of 1990) to regulate the export of perishable produce.

The PPEC Act is under review while the proposed amendment to the APS Act is with Parliament.
• It is a self-funded company that employs approximately 1000 employees (permanent and contracts), placed in its 32 national offices that service 1 492 activity points.

• The entity does inspections on any agricultural product that requires refrigeration or refrigerated transport.

It inspects approximately 190 types of perishable products, mostly 4 79 fruit; as well as dried fruit and grains for exports (grains are inspected from Tshwane).
Approximately 63% of fruit produced in the country is exported, 26% is processed and 11% gets into the local markets.

• The PPECB is involved in the export value chain through all inspections from the orchard/vineyard to the pack house, cold store, inland depot up to ship loading in the ports.

• The European Union (EU) is the largest export destination for South African fruit at 37%.
The EU is followed by Asia at 18%, Middle East at 14%, United Kingdom (UK) at 13%, Russia at 7%, North America at 6% and Africa at 5%.

• The PPECB is focusing on becoming more customer centric, introducing data analytics and business intelligent capabilities, re-designing the PPECB service delivery model to increase efficiencies and contain cost, improving business process efficiencies through digital transformation and improving business sustainability of black smallholder farmers and suppliers.
It has designed a Connectedness Flow that assist producers in identifying and choosing export markets.

• Its strategic projects include the self-funded Agricultural Export Technology Programme for youth; Women in Leadership Programme that is funded in collaboration with AgriSETA and a Development Programme on people with disabilities.

Through the Agricultural Export Technology Programme (AETP), which is AgriSETA-accredited, the PPECB educates and trains youth on the export value chain.
Once learners receive their qualification certificates, some are absorbed within PPECB and others get employment in the industry.

2.1.2.

Visit to the Cape Fruit Coolers (Cold Storage) After the briefings and video viewing, the delegation visited the Cape Fruit Coolers, cold storage facility that is located at Richwood Park.

It is one of the various cold stores in the region on which the PPECB does inspections.
It stores a wide range of products under frozen and chilled temperatures depending on the Export Protocol of each importing country.

The delegation was given a tour of the facility and an inspection demonstration on grapes intended for export was done by one of the PPECB’s Senior Inspectors.

The PPECB ensures that products leaving the country are handled, stored and transported at optimum temperatures and conditions.
Cold chain management is a vital link in the export value chain and cold storage units play an integral role in ensuring the quality of produce 5 80 intended for export is maintained.

It is essential that cold stores comply with the minimum food safety and technical requirements for food storage.

In cases where produce is intended for export, the relevant cold store must be registered with the PPECB; and must undergo annual inspections and certification.

2.2.

Visit to District Six 2.2.1.


Briefing by the Department of Agriculture, Land Reform and Rural Development and the Commission on Restitution of Land Rights § Brief history of District Six: Under the Group Areas Act of 1950, District Six was declared a whites only area.

District Six community was dispossessed of its land, their houses demolished and people forcefully removed from their homes.

The democratic government has since 1994 opened processes for restitution.
§ Lodgement and settlement: A total of 2 760 claims were lodged, 110 were found to be non-compliant with the Restitution of Land Rights Act (1994), 1 449 opted for financial compensation.

Settlement agreements regarding redevelopment of District Six were to be implemented in phases.
The City of Cape Town and the Provincial Government allocated land measuring approximately 42hectares for the redevelopment of District Six and the City is expected to contribute to the Bulk Infrastructure and Spatial Planning.

Phases 1 and 2 saw a total of 139 dwellings allocated to land claimants (24 in Phase 1, completed in 2008 and 114 in Phase 2 completed in 2012), and 108 allocated in Phase 3.
At the time of the visit, 954 claimants were still waiting for their dwellings, noting that claimants may still change options and decide on financial compensation.

§ Phase 3 development: Whilst the previous phases were facilitated by the District Six Development Trust, and there having challenges with the Trust being both the developer and claimants’ representatives, that arrangement was abandoned.
Phase 3 development was facilitated by the Rural Infrastructure Development Branch (RID) of the former Department of Rural Development and Land Reform in line with the order of the Court as discussed below.

The development includes a significant upgrade to infrastructure like bulk earthworks, bulk electrical, sewer, storm water, paving roads, streetlights and landscaping that will only service Phase 3.
§ Court Order: The District Six Working Committee and other applicants took the Department of Rural Development and Land Reform to court seeking a structured order 6 81 which requires the department to present a plan and programme for land restitution to the District Six claimants.

They further requested for the plan to set out a conceptual layout, details of funding and the methodology that will be applied in allocating residential units to the claimants.
The costed detailed plan with all the required information was submitted to the court on 17 December 2019.

The implementation of the plan for the settlement of the remaining claimants is still outstanding as discussed above and the progress reports were being submitted to the Court on a quarterly basis until the project is finalised.
§ Future developments: A total of 954 residential units for the remaining old order claimants will be carried out in two major builds; Build 1 comprising 467 residential units and Build 2 comprising 467 residential units.

In terms of the original programme, the Department set out to complete the project by the end of 2023 at a cost of R1.5 billion and on the revised programme the completion date is by December 2024 at a cost of R1.87 billion.
• Different structures representing different interests within the District Six community: The main committees representing the District Six community are: District Six Reference Group which is the current elected body; District Six Working Committee represents both old order claimants but in the main new order claimants who lodged between 1 July 2014 to 27 July 2016; District Six Civil Organisation which assists beneficiaries and/or returnees with social integration; District Six Advocacy groups representing the interest of the District Six homeowners; District Six Beneficiaries Trust elected by the claimants and facilitated the development of Phases 1 and 2 and the District Six Museum which focuses on heritage and memory making in the space of restitution and restoration.
• Budget: A total of R333 million was approved as developmental grants for District Six while a further R351 million was approved as an additional grant funding.

2.2.2.

Site visit - selected Phase 3 residential units The Committee visited two types of units; firstly, the three storey building that accommodates six families; and secondly duplexes with bedrooms in the basement area and living area and kitchen at the ground level.
However, some of those have all the bedrooms, lounge, kitchen 7 82 and bathroom on the ground level.

The proceedings during the walkabout at Phase 3 residential units can be summarised as follows: § The officials of the DALRRD and the Chief Land Claims Commissioner led the Committee, giving the committee a guided tour of the selected units, highlighting the size of the units, the fittings and features.
§ § The three units visited were 2 Bedroomed houses with build-in kitchen cupboards and a stove, a balcony and a common rooftop entertainment area.

The City of Cape Town was not represented at the walkabout; the Committee therefore could not have a first-hand experience of the concerns that the City had with regard to balcony rails and staircases.

§ The three storey units did not have lifts as some members of the community had complained.
The department has considered various aspects during the construction, especially the cost of maintenance of the lifts as well as the cost of installation.

On the issue of allocation, criteria for allocation took into consideration age and physical ability to ensure that those with some form of disability or elderly were allocated ground floor units.

§ The units were not gated, however the Commission had hired a security company to guard the units whilst they remain unoccupied.
The security company installed a movable security/perimeter fence.

The concern was that the term of its contract had expired, leaving the units potentially exposed to invasions.

The Committee was extremely concerned about the security risks for the units that were not occupied at the time of the visit.

It was understood that the reason for non-occupation was that there were no certificates of occupancy issued by the City of Cape Town.

3.
3.

COMMITTEE OBSERVATIONS With regard to the visit to the PPECB, the Committee observations were as follows: 3.1.

The PPECB’s system integration and move to digitisation of services is crucial and important for quick turnaround times and efficiencies in its operations and also beneficial to developed and technologically advanced producers.

However, that can be a constraint to uneducated and computer-illiterate farmers who would like to enter the export market space.

8 83 3.2.
8 83 3.2.

Impact of Covid-19 pandemic and the Ukraine/ Russia conflict to the export industry and consequently, PPECB’s operations and revenue generation.

3.3.

The small proportion of South African fruit that gets exported to the Continent.

3.4.

Conditions at ports (and some harbours) that are negatively impacting PPECB’s inspection personnel.

3.5.
3.5.

The need for investment on agricultural and rail infrastructure in light of the challenges that are faced by inland producers particularly smallholder producers who are mostly located in remote areas of the country.

With regard to the visit to District Six, the Committee observations were as follows: 3.6.

The Commission was complying with the Court order that sought to ensure justice for the victims of forced removals at District Six and has been submitting quarterly reports to the Court as ordered.
3.7.

There was progress in restoring the dignity of the victims of apartheid’s forced removals of the community of District Six.

Completion of phases 1 to 3 development of residential units was a step in the right direction.

Further two phases (i.e.

4 and 5) would be completed in 2024/5 financial year.

3.8.

Whilst phase 3 development was complete at the time of the visit, owners had not yet occupied the units pending the issuance of the certificates of occupancy by the City of Cape Town.
A total of 58 certificates of occupation were issued instead of 108 in accordance with the total number of units completed.

The Commission was unable to furnish the Committee with the details regarding the certificates of occupancy and reported that the matter was the competency of the City of Cape Town.

3.9.

The role of the City of Cape Town with regard to enforcement of compliance to building standards was acknowledged.
However, the delays with regard to the issuance of certificates of occupancy demonstrated lack of coordination and cooperative governance between the Department, the Commission and the City of Cape Town.

Nonetheless, ensuring compliance to standards and the security of beneficiaries was of great importance, therefore it was vitally important to speed up any process that required alterations so that safety of beneficiaries could be guaranteed.

3.10.
3.10.

There was lack of clarity with regard to the reported exemption from requirement of certificates of occupancy for the Department by the City of Cape Town.

As a result, the Commission had not allowed owners to occupy houses, a major concern for the 9 84 Committee.

Further engagement between the Department and the City of Cape Town was required around this issue.

3.11.

The Committee commended the Department for completion of Phase 3.
It was however, concerned that the process has been extremely slow.

Some of the claimants had already passed away, at the time of the visit, without experiencing the redress for the past injustices.

The delays in completion of Phase 3 meant that the beginning of the remaining development could be delayed as well.

3.12.
3.12.

The reported expiry of a contract between the Department and the security company guarding the Phase 3 units meant that the units would become exposed to possible invasions and/or vandalisation.

The Committee expressed deep concerns about the state of affairs with regard to security risks for the units.

3.13.

The last phases, Build 1 and Build 2, would be concluded in 2024/5.
Given complaints by the claimants who have waited for a very long time to return to District Six, the Committee emphasised the significance of prioritising District Six, especially the elderly claimants.

3.14.

The Commission was in negotiations with the Cape Peninsula University of Technology (CPUT) to purchase land to develop the outstanding phases.

It was reported that part of the land owned by the CPUT was historically part of District Six.

4.
4.

RECOMMENDATIONS In view of the observations recorded above, the Portfolio Committee makes the following recommendations to the Minister of Agriculture, Land Reform and Rural Development: 4.1.

Ensure that the PPECB gets additional funding for capacity building programmes for smallholder producers to increase their access to export markets including additional funding for the Agricultural Export Technology Programme that is directed at youth.

4.2.
4.2.

The Department should submit an action plan with time lines on how it will leverage market access for local producers to the South African Development Community (SADC) and the Continent at large through the Agreement on African Continental Free Trade Area (AfCFTA); and further highlight plans to facilitate and fast-track the participation of smallholder producers in export markets.

10 85 4.3.
10 85 4.3.

The Minister should liaise with the Minister of Transport to discuss the challenges at ports and harbours as well as those relating to freight transport and their impact on the agricultural industry; outlining how the challenges can be comprehensively addressed while also highlighting the need for investment on rail infrastructure particularly for inland agricultural production areas.

4.4.
4.4.

The Minister should provide an update on the status of the Strategic Integrated Project for agro-logistics (SIP 11), which was aimed at addressing infrastructure challenges in the agricultural value chain.

With regard to District Six, 4.5.

The Chief Land Claims Commissioner submits to Parliament the following reports: a.
The reports the Chief Land Claims Commissioner and the Minister of Agriculture, Land Reform and Rural Development submit to Court on a quarterly basis are tabled for information to Parliament for consideration by the Portfolio Committee on Agriculture, Land Reform and Rural Development, b.
Quarterly progress reports about the ‘finalisation’ of the District Six land claim, particularly, the allocation of resources to ensure the restoration of the dignity of the people of District Six through the redevelopment of the area and the return of the claimants and/or their direct descendants.

The report should include occupation of Phase 3 units.
c. Development and implement a communication strategy to ensure that the claimants awaiting the construction of Phase 4 residential units are informed about the progress and the expected date of completion, allocation and occupation of the units.

The strategy must also address the issues of the rights and obligations of those claimants occupying the houses, especially with regard to maintenance of the units and rectification of the defects.

4.6.
4.6.

The Department and the Commission must enhance their cooperative governance protocols and systems to ensure that efficient coordination between them and the City of Cape Town in order to circumvent the challenges that led to the delays in the allocation and occupation of the units during Phase 3 development.
Together with the City of Cape Town, they must resolve all outstanding matters that are impeding the occupation of the 11 86 houses by claimants and submit a report to Parliament for consideration by the Portfolio Committee on Agriculture, Land Reform and Rural Development.

4.7.
4.7.

The Department must ensure that the security of the dwellings is enhanced whilst the Commission addresses all outstanding issues with regard to the release of certificate of occupancy and attending to any issue that the City has raised with regards to compliance to building standards.

Where there are exemptions granted, the Department and the Commission must ensure that the security and the well-being of the beneficiaries occupying the units is not compromised.

4.8.
4.8.

For the next phases of redevelopment, the Department and the Commission should ensure that the criteria for allocation of units to claimants prioritise the elderly people and those with physical disabilities for allocation of units on the ground floor.

A transparent criteria and allocation process, agreed to with the claimants, must be developed and implemented.
Within a month after the adoption of this report by the National Assembly, the Minister should submit to Parliament a progress report on the implementation of these recommendations.

Report to be considered.

12 87 5.


Report of the Portfolio Committee on Sport, Arts and Culture on Budget Vote 37: Department of Sport, Arts and Culture, dated 10 May 2022 The Portfolio Committee on Sport, Arts and Culture (hereinafter referred to as the “Committee”), having considered the 2020 – 2025 Strategic Plan, the 2022/23 Annual Performance Plan (APP), and the budget of the Department of Sport, Arts and Culture, Vote 37, reports as follows: 1.
Introduction Section 42(3) of the Constitution of the Republic of South Africa, 1996 bestows the oversight function over the national executive to the National Assembly (NA).

The Committee considered the 2022/23 budget of the Department of Sport, Arts and Culture (DSAC) as part of its oversight function over the Department as mandated by Public Finance Management Act (No.

1 of 1999) and Money Bills Amendment Procedure and Related Matters Act (No.

9 of 2009).
9 of 2009).

The Department briefed the Committee on its 2022/23 budget and 2022/23 APP on 04 May 2022.
For the 2022/2023 financial year, the Department has committed to focusing on the following projects, among others: • opportunities that will drive the transformation agenda and new business models for the Sector, • the identification and development of the historically marginalised and under- resourced provinces that do not have theatre facilities, • supporting the professional sport system by finding new and innovative solutions to mitigate the negative effect of COVID-19 in the field of sport, ensuring that talent is encouraged to emerge from all communities in an equitable manner, and is nurtured and supported, • seeking new ways of forming strategic collaboration by mobilising the resources, knowledge, creativity and concern of all role-players to increase social cohesion on a partnership basis.
• promotion of the national symbols, and pride in and appreciation of our shared heritage sites.

One key project here is the construction of the Monumental Flag, which forms part of the Social Cohesion and Nation Building programme of action.
• Building on the current work of the development of the Cultural and Creative Industries Masterplan and the implementation of the revised White Paper on Arts, 1 88 Culture and Heritage by putting forward bold plans to channel investment in the areas of innovation, enhancing business skills and creation of access to new markets; and; • Ensuring that the country is on track in its preparation for the Netball World Cup that will be staged in Cape Town in 2023 and the Table Tennis World Championships to be hosted in Durban, also in 2023.
In September 2021 the National Technical Planning Forum (NTPF) shared delivery priorities that they have developed for 2022/23.

These areas will ensure that government continues to manage and mitigate the impact of the pandemic while also planning for recovery.

The following four key focus areas were identified to provide a strategic focus to the priorities: (1) Manage the pandemic, (2) Drive economic recovery, (3) Employment support and relief, and (4) Enhance state capacity to deliver.
Although at first glance it could appear that DSAC can contribute to all four priorities, very specific interventions have been identified by the NTPF.

During 2022/23 DSAC will focus on supporting the creative industry through the Mzansi Golden Economy (MGE) programme.

To this end, long-term plans will be developed to focus on job opportunities and to come up with sustainable interventions to prevent the loss of income experienced in the sector.
In the 2021/22 financial year, the Department announced an MGE Open Call for applications for funding for Cultural Events, Public Art and Touring Ventures.

When the Open Call for applications closed at the end of June 2021, a total of 3 550 applications had been received.

The MGE Guidelines have been adjusted and aligned to the current protocols imposed by the impact of COVID-19, which meant that online and live-streaming became the new norm.

This initiative is set to continue in 2022/23.


It must be emphasised that the MGE does not create jobs but provides an enabling environment for job opportunities in various cultural and creative genres through several work streams.

The purpose of this document, therefore, is to table the Committee report after scrutiny of the budget allocated to Vote 37: Sport, Arts and Culture in the 2022 Estimates of National Expenditure (ENE).
This Budget Report thus provides a comprehensive analysis of the Department’s allocated budget.

2.

Purpose of the Budget Vote:37 2 89 The purpose of the Vote is to provide an enabling environment for the sport, arts and culture sector by developing, transforming, preserving, protecting and promoting sport, arts and culture at all levels of participation to foster an active, winning, creative and socially cohesive nation.

3.
3.

Method The Committee met to consider the 2020 – 25 Strategic Plans and 2022/23 APPs and budgets of the Department, and Athletics South Africa (ASA).

These were considered against the background of key government policy documents, including, amongst others, the National Development Plan (NDP), the 2019 – 2024 Medium Term Strategic Framework (MTSF), and the 2022 State of the Nation Address (SONA).
With national lockdown restrictions and the Parliament fires that took place in January 2022, all meetings were held on virtual platforms.

4.

Strategic Overview of the Department of Sport, Arts and Culture Cabinet adopted the National Development Plan: Vision 2030 (NDP) in 2012 as a long- term vision and plan for the country.

This broad policy is regarded as the road map to deal with the challenges of unemployment, poverty and inequality by 2030.
The Vision 2030 is conceptualised as standing on three policy pillars: 1.

Achieving a more capable state; 2.

Driving a strong and inclusive economy; and 3.

Building and strengthening the capabilities of South Africans.
These are underpinned by seven Government priorities, as contained in the 2019-2024 MTSF, namely: • Priority 1: Building a capable, ethical and developmental state • Priority 2: Economic Transformation and Job Creation • Priority 3: Education, Skills and Health • Priority 4: Consolidating the Social Wage through Reliable and Quality Basic Services • Priority 5: Spatial Integration, Human Settlements and Local Government • Priority 6: Social Cohesion and Safe Communities • Priority 7: A better Africa and World 3 90 Within that broad policy framework, the Department has to ensure that its outcomes and that of the entities reporting to the Minister are aligned to these seven broad policy priorities.
This alignment ensures a direct focus of the work of the Department and its entities over the next five years as part of a capable, ethical and developmental state.

This is a prerequisite for sector transformation, job creation and targeted strategies to facilitate nation-building and social cohesion.

To this end, the Department responds to Chapter 15 of the NDP: Transforming society and uniting the country.
This chapter draws together what is needed to transform the South African society to be prosperous, non-sexist, non-racial and democratic, which are key values enshrined in the Constitution.

In relation to the national priorities for the MTSF, with the exception of Priorities 4 and 7, the Department contributes to the remaining Government priorities with a sharp focus on increasing the market share of and job opportunities created in the sector, and building a diverse, socially cohesive society.
In its effort to translate the broad policy statements into implementable programmes, the Department has stated the following as predetermined outcomes linked to the MTSF: • Outcome 1: Increased market share of and job opportunities created in sport, cultural and creative industries.

• Outcome 2: A diverse, socially cohesive society with a common identity.

• Outcome 3: Transformed, capable and professional sport, arts and culture sector.
• Outcome 4: Integrated and accessible SAC infrastructure and information.

• Outcome 5: Compliant and responsive Governance/Administration.

In support of these outcomes, the Department has developed focus areas categorised into the following ten points: 1.

Create job opportunities and support entrepreneurs.

2.

Increase market share of sport, cultural and creative industries.

3.

Capacitate and professionalise the sport, arts and culture sector.

4.

Increase access to infrastructure and information.


5.

Establish a common national identity.

6.

Engender compliant and responsive governance.

7.

Strengthen sport and cultural diplomacy.

4 91 8.

Accelerate social cohesion.

9.

Promote official languages.

10.

Implement the emergency response plan on gender-based violence and femicide.

The Department has devised a range of high impact projects to respond to the outcomes and focus areas.
These include, among others, the amalgamation of entities; the provision of Government support to anti-doping agencies; support high-performance athletes to achieve success at international events; and support to practitioners through the SAC academies, centres of excellence and incubators.

Over the MTSF, the Department’s policy and legislative programme is be guided by two White Papers.
The White Paper for Arts and Culture needs to be implemented so that it can contribute to the transformation of the sector.

The White Paper for Sport and Recreation will co-exist with that of Arts and Culture.
The APP notes that the Department is in the process of developing and/or reviewing the following policies and framework documents: • Athletes Support Policy; • South African Sports Academies Strategic Framework and Policy Guidelines; • The Prioritisation of Sport and Recreation Bodies Policy; • Women in Sport Policy; • • Infrastructure Policy; Implementation Framework of the South African Language Practitioners’ Council Act; • National Strategy for the development and promotion of a South African literary culture; • Visual Arts Strategy; • Arts and Culture Promotion and Development (ACPD) Funding Policy; • Craft Strategy; • Cultural and Creative Industries Masterplan; • International Relations; • Repatriation and restitution of human remains and heritage objects policy; and • National Policy Framework on the Digitisation of Heritage Resources.
The Department has embarked on a process that sees the temporary deprioritisation of some programmes and projects that do not directly support relief measures.

It has refocused the 5 92 integrated medium-term planning for resilience and inclusive development and has focused efforts to improve the capacity and capability of the state to deliver efficiently and effectively.

The intention of the MTSF is to integrate all key plans into a results-based framework.
This will assist with coordination and ensure that important interventions and milestones are monitored to support delivery and accountability.

5.

Summary of budget expenditure (2022/23) The total budget allocation for the 2022/23 financial year is R6.29 billion.
The Department organises its expenditure under four programmes, these are: • Programme 1: Administration (R453.2 million); • Programme 2: Recreation Development and Sport Promotion (R1.46 billion); • Programme 3: Arts and Culture Promotion and Development (R1.75 billion); and • Programme 4: Heritage Promotion and Preservation (R2.63 billion).

The table below reflects the budget allocation for 2022/23 and over the medium term.
Table 1: Overall Budget Allocation 2021/22 – 2024/25 2021/22 2022/23 2023/24 2024/25 Total Total Total Total 458,2 453,2 454,9 474,8 1 467,3 1 462,8 1 482,7 1 549,4 1 287,3 1 749,8 1 778,2 1 375,5 2 534,6 2 629,3 2 631,5 2 749,8 R million MTEF allocation 1: Administration Recreation and 2: Development Sport Promotion 3: Arts and Culture and Promotion Development 4: Promotion Preservation Heritage and the Provide services strategic and the Purpose: leadership, management support to Department.
Purpose: Support the provision of mass participation opportunities, the development of elite athletes, and regulation and maintenance of facilities.

Purpose: Promote and develop arts, culture and languages, and implement the national social cohesion strategy.

Purpose: Preserve and promote South African heritage, including archival and heraldic heritage.

Oversee and transfer funds to libraries.


Total expenditure estimates 5 747,3 6 295,1 6 347,2 6 149,5 Source: National Treasury ENE, 2022 6 93 The following points are for noting when considering the budget over the medium term: • Total expenditure is expected to increase at an average annual rate of 2.3 per cent, from R5.7 billion in 2021/22 to R6.1 billion in 2024/25.

Transfers and subsidies account for an estimated 80.7 per cent (R15.1 billion) of the Department’s spending over the medium term.
• The Department’s total budget over the medium term is R18.8 billion after a baseline increase of R7.8 million for salary adjustments in 2022/23, and a total of R902 million in the first two years of the MTEF period for the presidential employment initiative for the creative industry.

For the 2022/23 financial year, the total budget allocation is R6.29 billion.

This is projected to increase to R6.34 billion in 2023/24 and to R6.14 billion in 2024/25.
Transfers and subsidies amount to R5.08 billion, or 80.7 per cent, of the budget allocation for 2022/23.

When comparing the nominal amounts for the budget allocation across the MTEF, allocations show a year-on-year increase until 2023/24.

However, when the projected inflation rates (2022/23: 4.5 per cent; 2023/24: 4.4 per cent; and 2024/25: 4.5 per cent) are taken into consideration, the cumulative growth rate between 2021/22 and 2024/25 is -2.1 per cent.
The highest allocation is towards Programme 4: Heritage Promotion and Preservation which will receive R2.6 billion or 41.8 per cent of the total budget to the Department.

The lowest allocation is towards Programme 1: Administration, which will receive R453 million or 7.2 per cent of the total budget in 2022/23.

The highest percentage change in the budget will be in Programme 3: Arts and Culture Promotion and Development with a 5.4% change in allocation.
The report will now turn to budgetary allocations per programme.

Programme 1: Administration This programme plays an important role in giving effect to first priority of the NDP, that is, to build a capable, ethical and developmental state.

This priority is also expressed in the MTSF for the five-year term 2019-2024, as a crucial mode that is required to achieve Vision 2030.
The outputs delivered in Programme 1 contribute predominately to DSAC Outcome 7 94 3: Transformed, capable and professional sport, arts and culture sector and Outcome 5: Compliant and responsive governance.

Table 2: Programme 1 Budget Allocation 2021/22 – 2022/23.
5,7 79,9 Budget 2021/22 2022/23 4,5 71,9 Sub-programme R million 1: Ministry 2: Management 3: Strategic Management and Planning 4: Corporate Services 5: Office of 68,1 Financial Officer 125,4 6: Office Accommodation 453,2 TOTAL Source: National Treasury ENE, 2022/23 62,3 120,3 458,2 21,8 161,6 23,4 166,5 the Chief Nominal Rand change Real Rand change Nominal per cent change 2022/23 Real per cent change 2022/23 2021/22 – 2022/23 2021/22 – 2022/23 -1,2 -8,0 -1,6 -4,9 5,8 5,1 -4,8 -1,4 -11,1 1,6 -11,9 2,9 -0,3 -24,3 -21 % -10,% -6,8% -2,9% 9,3% 4,2% -1,0% -24,5% -13,9% -10,9% -7,1% 4,6% -0,3% -5,4% For the 2022/23 financial year, the budget allocation for this programme is R453.2 million.
Compared to the previous financial year, this represents a nominal decrease of R5.6 million, or 1.2 per cent.

When considering the inflation rate of 4.5 per cent into account, the allocation has decreased by R25.1 million or 5.5 per cent.
Programme 2: Recreation Development and Sport Promotion The outputs delivered in Programme 2 contribute predominately to DSAC Outcome 2: A diverse, socially cohesive society with a common national identity; Outcome 3: Transformed, capable and professional sport, arts and culture sector; and Outcome 4: Integrated and accessible SAC infrastructure and information.

Table 3: Programme 2 Budget Allocation 2021/22 – 2022/23.
Sub-programme R million 1: Wining Nation Budget 2021/22 2022/23 Real Nominal Rand Rand change change 2021/22 – 2022/23 Real per Nominal cent per cent change change 2022/23 2022/23 2021/22 – 2022/23 278,9 263,8 -15,1 -26,5 -5,4% -9,5% 8 95 2: Active Nation 3: Infrastructure Support TOTAL Source: National Treasury ENE, 2022/23 708,9 479,5 1 467,3 727,8 471,1 1 462,8 18,9 -8,4 -4,5 -12,4 -28,7 -67,5 2,7% -1,8% -0,3% -1,8% -6% -4,6% When compared to the 2021/22 financial year this programme’s budget allocation has decreased by R4.5 million or 0.3 per cent in nominal terms.
However, over the medium term, the estimated allocation represents an increase of 1.8 per cent increase in nominal terms, but a 2.5 per cent decrease if inflation adjusted.

The highest change in allocation was seen in sub-programme 1: Winning Nation which sees a reduction of R15.1 million from R278.9 million in 2021/22 to R263.8 million in 2022/23.

This represents a real percent change in the budget of 9.5 per cent.
Sub-programme 2: Active Nation is the only sub-programme with an increase in budget allocation from R708.9 million in 2021/22 to R727.8 million in 2022/23.

This represents a 1.8 per cent real change in budget.
This programme will ensure that: • athletes are supported through a range of interventions including the scientific support programme, the sports academies and the ministerial sports bursary programme; • people participate in organised sport and active recreation events; • the Department embarks on sport and recreation promotion campaigns and events; • schools, hubs and clubs provided with equipment and/or attire; • school sport is supported at district and national level; • National Federations meet 50 percent or more of all prescribed Charter transformation targets; and • the Department supports and facilitates the implementation of sport and heritage infrastructure projects.
Programme 3: Arts and Culture Promotion and Development The outputs delivered in Programme 3 contribute to all five departmental outcomes.
These outputs will ensure: • the promotion and development of official languages, and the support to efforts to increase qualified language practitioners through language bursaries; 9 96 • the development of the Cultural and Creative Industries (CCIs) through supporting practitioners and their enterprises in various cultural and creative sectors to gain access to both local and international markets; • capacity-building projects are financially supported to enhance the ability of practitioners and enterprises to participate effectively in various stages of the value chain of their sector; • provincial community arts development programmes have implemented that position and organise, community arts development to align with the overarching Government • • objectives of access and participation in the arts by South Africans; and the coordination of international engagements on the continent and globally; the promotion and support of programmes and partnership that foster nation-building and social cohesion, including Gender-Based Violence (GBV) and anti-femicide programmes; • the increase in support to the creative industry, including placement of artists in schools to promote and support arts education through the MGE Strategy.
Table 4: Programme 3 Budget Allocation 2021/22 – 2022/23.
56,0 121,9 123,1 114,3 120,9 Language International Budget 2021/22 2022/23 54,8 Sub-programme R million 1: National Services 2: Pan South African Language Board 3: Cultural and Creative Industries Development 4: Cooperation 5: Social Cohesion and Nation Building 6: Mzansi Golden Economy 7: Arts Performing Institutions 8: National Film and Video Foundation 9: National Arts Council 123,0 TOTAL 1 749,8 Source: National Treasury ENE, 2022/23 153,5 1 287,2 291,8 300,3 747,3 318,6 145,9 149,2 62,7 41,8 69,3 42,5 Nominal Rand change Real Rand change 2021/22 – 2022/23 Nominal per cent change 2022/23 Real per cent change 2022/23 2021/22 – 2022/23 -2,1% -6,4% 1,8% 6,7% 1,7% -2,6% 2,1% -2,7% -3,6 -3,1 2,4 -1,1 3,6 10,5% 5,8% -1,2 2,2 7,6 0,7 6,6 455,5 18,3 423,3 4,6 156,1% 6,1% 145,1% 1,5% 3,3 -3,1 2,3% -2,1% -30,5 462,6 -35,8 387,2 -19,9% 35,9% -23,3% 30,1% 10 97 For the 2022/23 financial year, the budget allocation for this programme is R1.7 billion, which is a R462 million increase from 2021/22.
The highest allocation for Programme 3 was in sub-programme 6: Mzansi Golden Economy (MGE) which is allocated R747 million (or 42.7 per cent) of the total budget for the programme, an increase from R291 million in the 2021/22 financial year.

The highest percentage change in allocation within the programme was also in sub-programme 6: Mzansi Golden Economy, shows a 20 per cent total change as the allocation.
The lowest allocation in the programme is towards sub- programme 4: International Cooperation, which will receive a R41.8 million or 2.4 per cent allocation.

The allocation to sub-programme 9: National Arts Council (NAC) decreased from R153.5 million in 2021/22 to R123.0 million in 2022/23.

This is in fact a result of the once-off allocation to the council in 2021/22 for the disbursement of Presidential Employment Stimulus Programme (PESP) funds to artists and artistic programmes.
The declaration of the Mandela Bay Theatre Complex (MBTC) a cultural institution, brings the number of performing arts institutions reporting to the Department to six.

This new entity will receive an allocation of R20 million for the 2022/23 financial year.

Programme 4: Heritage Promotion and Preservation Purpose: Preserve and promote South African heritage, including archival and heraldic heritage.

Oversee and transfer funds to libraries.


The outputs delivered in Programme 4 contribute predominately to DSAC Outcome 2: A diverse, socially cohesive society with a common national identity; Outcome 3: Transformed, capable and professional sport, arts and culture sector; and Outcome 4: Integrated and accessible SAC infrastructure and information.
Through its sub-programmes, this Programme will: • support and implement a range of projects including awarding heritage bursaries; books documenting Living Human Treasures; development of heritage policies, as well as the promotion of national identity utilising the flag at national days, major cultural and sporting events in schools, the Monument Flag Project and “I am the Flag” Campaign; • upgrade national archives infrastructure to address infrastructure challenges in relation to space, technology and processes; 11 98 • • financially support newly built and/or modular libraries; and transform and standardise of geographical names.
Table 5: Programme 4 Budget Allocation 2021/22 – 2022/23.
66,8 57,3 606,9 143,1 1 524,6 58,7 Budget 2021/22 2022/23 50,3 62,2 627,2 146,6 1 601,4 62,8 Sub-programme R million 1: Heritage Promotion 2: National Archive Services 3: Heritage Institutions 4: National Library Services 5: Public Library Services 6: South African Heritage Resources Agency 7: South Geographical Council 8: National Heritage Council TOTAL Source: National Treasury ENE, 2022/23 African Names 72,2 2 534,6 73,6 2 629,3 4,9 5,3 Nominal Rand change Real Rand change 2021/22 – 2022/23 -16,5 4,9 20,3 3,5 76,8 4,1 -18,7 2,2 -6,7 -2,8 7,8 1,4 Nominal per cent change 2022/23 Real per cent change 2022/23 2021/22 – 2022/23 -24,7% 8,6% 3,3% 2,5% 5,0% 7,0% -27,9% 3,9% -1,1% -2,0% 0,5% 2,4% 0,4 0,2 8,2% 3,5% 1,4 94,7 -1,8 -18,5 1,9% 3,7% -2,5% -0,7% Programme 4 receives the bulk of the total departmental budget, just over R2.6 billion or 44.1 per cent.
When compared to the 2021/22 financial year this programme’s budget allocation has increased by R94.7 million, or 3.7 per cent in nominal terms.

Adjusted for inflation, the programme however sees a real decrease of R18.5 million, or 0.7 per cent.

There have been no major changes to the percentage allocation of the total programme budget per sub-programme with the exception of sub-programme 1: Heritage Promotion.
This sub-programme’s allocation has decrease from R66.8 million in 2021/22 to R50.3 million in 2022/23 which represents a nominal decrease of 24.7 per cent of the allocation compared to the previous financial year.

Of this programme allocation for 2022/23, R2.5 billion, or 95.8 per cent, is classified as Transfers and subsidies.
Through this programme, the Department funds a significant number of entities including, but not limited to, national museums, the National Heritage Council (NHC), the South African Heritage Resources Agency (SAHRA), and public 12 99 library services.
The latter (sub-programme 5 in the budget structure), transfers funds to Provincial Departments for conditional allocations through the Community Library Services Grant (CLSG) for constructing and upgrading libraries, hiring personnel and purchasing library materials.

Thus the CLSG accounts for the bulk of this programme.

The main aim of the CLSG is to transform urban and rural library infrastructure and services through targeting previously disadvantaged communities.
This Grant primarily contributes to Government Priority 6: Social cohesion and safe communities.

The allocation for 2022/23 is R1.6 billion, or 60.9 per cent, of the total budget allocation for this programme.

In respect of the CLSG, this grant is allocated to the relevant provincial department and administered by that department or through a service-level agreement with municipalities.
In collaboration with provincial Departments of Basic Education, the grant also funds libraries that serve both schools and the general public.

Funds from this grant may also be used to enable the shift of the libraries function between provinces and municipalities.

The grant is allocated R4.8 billion over the next three years which will see 96 new libraries built, 135 community libraries upgraded and 310 000 library materials procured.
The outputs for the CLSG for the 2022/23 financial year includes, among others:1 • 25 new library structures completed; • four new dual-purpose library structures completed; • 10 upgraded library structures completed; • 2 495 existing contract library staff maintained in all provinces; and • 68 new staff appointed at public libraries to support the shifting of the function to provinces.

6.
6.

Engagements with entities and/or federations The Committee engaged Athletics South Africa (ASA) which receives an annual grant from the Department to enable them to contribute towards implementing the mandate of the Department as an extension of its service delivery network.

An overview of the engagement is presented below.

1 Division of Revenue Bill (2022), p.188.

13 100 6.1.
13 100 6.1.

Athletics South Africa (ASA) Athletics South Africa (ASA) is the national governing body for the sport of athletics (including track and field, cross country, road running and race walking) in South Africa, recognised by the World Athletics, and also a member of Confederation of African Athletics.

The organisation reports to the South African Sports Confederation and Olympic Committee (SASCOC).

Athletics South Africa falls under Programme 2 of the Department as a Departmental agency.
ASA is based in Johannesburg, South Africa and comprises 17 provincial associations (with the nine provinces), 1 012 athletics clubs, 304 000 registered athletes and approximately 500 000 unregistered athletes.

The organisation is controlled by a board of directors led by a president.
Since its inception in 1992, ASA focused on four main objectives: • To unify all athletics in South Africa; • To develop the sport of athletics in South Africa, particularly at grassroots level,; • To facilitate the participation of previously disadvantaged communities in athletics; and • To prepare athletes for participation in international events.

6.1.1.

DSAC support provided to ASA The Committee met with ASA in the presence of the Department on 19 April 2022.
The following was noted with regard to departmental support provided to the federation: • The Department provides financial support to ASA on an annual basis.
• In 2021/22 DSAC gave R5.75 million financial support to Athletics SA to fund these programmes: o Federation's capacity development o Administration support o School Sport capacity development o National Coaches Support programmes o Technical Officials Training o Administration training o Senor and underage National Championships 14 101 • An additional R4.2 million was transferred in 2021/22 towards Ms Caster Semenya’s legal challenge of the Differences of Sex Development (DSD) Regulations.

6.1.2.
6.1.2.

The following was highlighted by ASA in their presentation on the 2022 APP: Leadership and Management • Effective leadership is the core recipe for success in sport.

The lack of resources, skills and effective leadership needs to be addressed to achieve ASA’s objectives in the next five years.

• Provincial and local structures have to be transformed to provide strategic leadership.
• Capacity building in ASA will focus on empowering leadership and management of provincial structures through regular training to increase effectiveness.

• Provincial and local structures will be empowered to direct, supervise, encourage, inspire, and co-ordinate, and in doing so, facilitate action and guide change.

Capacity Building • Technical Official Training: Without qualified and competent officials, the integrity of competitions and competition results will be compromised.
ASA will therefore recruit new officials and provide theoretical and practical training to enable them to officiate at national level competitions.
Competition Organisation • Using athletics competitions to provide a simple and logical athlete development pathway, with transparent criteria for progression to the next level; • Encouraging recruitment, retention and performance improvement through competitions; • Turning competitions into contemporary events which have flexible, innovative, and shorter formats with easy entry methods and improved communication reflecting the lives of young people; 15 102 • Increasing entertainment content of competitions to attract more spectators; • Setting mandatory participation standards for all licensed athletes; and • Support school sports competitions.
High Performance 1.

The programme aims to support, encourage, develop and optimise the talent of each athlete towards achieving the goals of ASA in winning medals at international competitions.

The programme includes the hosting of a series of national competitions and training camps for all athletics disciplines, as well as youth and junior development training camps.

Anti-Doping 2.

ASA is serious about anti-doping matters and will implement aggressive communication and education plan.
A whistleblower hotline is available through SAIDS to encourage athletes, coaches, agents and the public to report individuals suspected of using banned substances/drugs.

Broadcasting 3.

Following several engagements with SABC and Supersport, ASA's broadcasting consultant eventually recommended Supersport as the official broadcaster of ASA events.

Nevertheless, ASA continues to try engaging with SABC on broadcast agreements.
The agreement will include live content and highlights packages covering road running, track and field and cross-country events.

7.

Committee observations Having considered and examined the Departmental 2020 – 2025 Strategic Plan and 2022/23 Annual Performance Plan with associated budgets, the Committee made the following observations: 7.1.

Observations in relation to the Department of Sport, Arts and Culture 16 103 7.1.1.
Language rights: The Committee noted that the Department is at the centre of the protection, promotion, usage and equality of all national languages and enquired what mechanisms the Department has in place to monitor this.

7.1.2.

Digital content: The Committee sought to establish how the Department’s planning will assist digital content creators.

7.1.3.
7.1.3.

Employment equity targets: The Committee noted that the target for the employment of people with disabilities hovers around two per cent and enquired if there are any plans to increase this target in the near future.

7.1.4.

Merging of the two departments: The Committee asked how the Department is managing division of labour in order to avoid redundant staff.

7.1.5.
7.1.5.

Appropriated budget versus the sector mandate: The Committee asked the Department to elucidate what percentage of its total allocation is transferred outside of the Department and whether this is adequate to implement the mandate and core business of the Department.

7.1.6.

Interdepartmental partnerships: The Committee sought to establish what partnerships have been established with other Government departments to ensure that the Department can fully implement its mandate.

7.1.7.
7.1.7.

COVID-19 Recovery Plan: The Committee enquired how the Department’s APP takes this Plan into consideration.

7.1.8.

Legislative and policy review: The Committee requested information on the status of this within the Department.

7.1.9.

Court rulings: The Committee noted the High Court order of 2018 in favour of the South African Roadies Association (SARA) respect of the implementation of the Settlement Agreement between the Department and SARA.

7.1.10.
7.1.10.

Fourth Industrial Revolution (4IR): The Committee sought to establish how the Department has taken the implementation of the 4IR into consideration in its planning.

7.2.

Observations in relation to Athletics South Africa 7.2.1.

The Members congratulated Mr Moloi's (The ASA President) on his appointment to the World Implementation Working Group by World Athletics.

7.2.2.

Members wanted an update on Caster Semenya’s court case on Differences in Sexual Development (DSD) with World Athletics.
17 104 7.2.3.

Members wanted to know how many athletes were supported by the COVID-19 relief fund.

7.2.4.

Members wanted to know the mechanisms that DSAC use to monitor sports gatherings since the return to sport was enabled.

7.2.5.

The Members wanted to know the annual budget ASA receives from the National Lottery Commission (NLC).

7.2.6.
7.2.6.

Members wanted an update with regards to the Special Investigating Unit (SIU) investigation which implicates the Acting CEO of ASA in the NLC’s stadium infrastructure corruption case.

7.2.7.

Members wanted to know the current the state of school’s athletics as well as the relationship between ASA and the South African School Athletics (SASA) as there appeared to be some friction between the two.

7.2.8.
7.2.8.

Members wanted to know how will ASA ensure talented athletes who qualify for national championships are not disadvantaged from competing due to financial challenges.

7.2.9.

Members wanted to know on the non-participation by Northern Cape in National Athletics and School championship events.

7.2.10.

Members wanted historical records indicating all the funding allocated to ASA by the NLC for infrastructure projects, so it can be established if the funds were used for their intended purpose.
7.2.11.

Members enquired about the availability and functioning of the Safe Guarding policy at ASA.

7.2.12.

Members wanted to know more about the broadcasting deal between ASA and Supersport and why ASA used consultants instead of negotiating directly with the broadcasting providers.

7.2.13.
7.2.13.

On the critical role of school athletics for athlete development and transformation, Members wanted to know what ASA and the Department of Basic Education are doing to support learners who have the potential to be competitive.

8.

Recommendations It is requested that the Minister of Sport, Arts and Culture considers the following recommendations and reports back to the Committee by no later than the end of the 2022/23 financial year, i.e.

31 March 2023.

18 105 8.2.


Recommendations in relation to the Department of Sport, Arts and Culture 8.2.1.

Language rights: The Department to ensure that the South African Language Practitioners’ Council is established to advance the promotion and protection of language practice in the country.

8.2.2.
8.2.2.

Digital content: With the finalisation of the Department of Communication’s Digital Economy Master Plan, the DSAC and the South African Broadcasting Coorporation (SABC) should ensure the issue of content creation is addressed.

8.2.3.

Legislative and policy review: The Department to submit an overview of how it plans to implement its legislative and policy review, including the National Strategy for Women and Sport South Africa by the end of the second quarter of the 2022/23 financial year.

8.2.4.
8.2.4.

Court rulings: The Department to provide further insight into the implications of this court order between DSAC and SARA by the end of the first quarter of the 2022/23 financial year.

8.2.5.

COVID-19 Recovery Plan: The Department to continue to support cultural and creative workers and athletes.

8.3.

Recommendations in relation to Athletics South Africa 8.3.1.
ASA needs to continue to support Caster Semenya in all efforts against World Athletics when the case is presented to the European Court for Human Rights.

8.3.2.

ASA needs to ensure that athletes are adequately prepared and supported towards the 2022 Commonwealth Games in Birmingham.

8.3.3.

ASA needs to ensure that the schools athletics becomes more functional and inclusive of all demographics in order to achieve transformation.

8.3.4.
8.3.4.

ASA should ensure that the broadcasting partnership with Supersport benefits the athletes.

The federation also needs to continue to reach out to the national broadcaster (SABC) to ensure that it secures broadcasting rights to reach a wider audience.

8.3.5.

ASA to provide an update on the way forward regarding its Acting CEO’s implication in the SIU investigation into the NLC funds meant to build an athletics stadium in Kimberly by the end of the second quarter of the 2022/23 financial year.
19 106 8.3.6.

ASA should maintain good working relationships with SASA in order to promote school athletics.

9.

Conclusion Having satisfied itself in its engagement with the Department of Sport, Arts, and Culture, and its entities on their Annual Performance Plans and the Budget, the Portfolio Committee on Sport, Arts and Culture recommends that the House approves Budget Vote 37.

Report to be considered.

20 107 6.


REPORT OF THE PORTFOLIO COMMITTEE ON HIGHER EDUCATION, SCIENCE AND INNOVATION ON BUDGET VOTE 17: HIGHER EDUCATION AND TRAINING, DATED 6 MAY 2022 1.
INTRODUCTION AND MANDATE OF THE COMMITTEE The Portfolio Committee on Higher Education, Science and Innovation (“Committee”), having considered the 2022/23 Annual Performance Plans (APPs) and budgets of the Department of Higher Education and Training (hereinafter the Department), Council on Higher Education (CHE), Quality Council for Trades and Occupations (QCTO), National Student Financial Aid Scheme (NSFAS) and the South African Qualifications Authority (SAQA), reports as follows: 1.1.
Mandate of the Committee and Department The Committee derives its mandate from Section 55(2) of the Constitution of the Republic of South Africa, which states that “the National Assembly (NA) must provide for mechanisms (a) to ensure that all executive organs of state in the national sphere of government are accountable to it; and (b) to maintain oversight of (i) national executive authority, including the implementation of the legislation; and (ii) any organ of state.” Rule 227 of the Rules of the National Assembly (9th edition) provides for mechanisms contemplated in section 55(2) of the Constitution.
The Department derives its mandate from section 29 of the Constitution of the Republic of South Africa and the following legislation: Higher Education Act, 1997 (Act No.101 of 1997), National Student Financial Scheme Act, 1999 (Act No.

56 of 1999), Continuing Education and Training Act, 2006 (Act No.

16 of 2006), National Qualifications Framework Act, 2008 (Act No.

67 of 2008), Skills Development Act, 1998 (Act No.

97 of 1998), Skills Development Levies Act, 1999 (Act No.
9 of 1999) and the General and Further Education and Training Quality Assurance Act, 2001 (Act No.

58 of 2001).

The Committee oversees the implementation of the above-mentioned legislation.

1.2.

Purpose of the Budget Vote 17 Report The Report accounts for the work done by the Committee in the consideration of the 2022/23 Annual Performance Plans (APPs) and budgets of the Department, NSFAS, CHE, SAQA and the 1 108 QCTO in accordance with Section 27(1) of the Public Finance Management Act, 1999 (Act No.
29 of 1999), and as referred by the Speaker of the National Assembly (NA) to the Committee in terms of Rule 338 for consideration and reporting.

1.3.

Method The Committee considered the 2022/23 APPs and budgets of the Department, NSFAS, CHE, SAQA and the QCTO were considered against the background of key government policy documents, including, amongst others, the National Development Plan (NDP), the 2019 – 2024 Medium Term Strategic Framework (MTSF), and the 2022 State of the Nation Address (SONA).
The Committee had briefing sessions with the Auditor-General South Africa (AGSA) to receive a briefing on the review of the 2022/23 APPs of the Higher Education and Training Portfolio on 20 April 2022.

The Committee also held briefings with the Department, NSFAS, CHE, SAQA and the QCTO on the same day to consider their 2022/23 APPs and budgets.

2.

OVERVIEW OF THE KEY POLICY FOCUS AREAS RELEVANT FOR THE DEPARTMENT AND THE ENTITIES 2.1.

Key government policies 2.1.1.


National Development Plan (NDP) Vision 2030 The NDP identifies the decent work, education and capacity of the state as particularly important priorities.

For the post-school education and training sector, the NDP envisages that by 2030, South Africans should have access to education and training of the highest quality.
The education, training and innovation system should cater for different needs and produce highly skilled individuals; and graduates of the post-school system should have adequate skills and knowledge to meet the current and future needs of the economy and society.

2.1.2.
2.1.2.

White Paper for Post-School Education and Training (WPPSET) The White Paper articulates a vision for an integrated system of post-school education and training, with all institutions playing their role as part of a coherent but differentiated system.

The White Paper sets out strategies to expand the current provision of education and training in South Africa, improve its quality, and integrate the various strands of the post-school system.
The White Paper sets interventions for implementation by different sectors within Post-School Education and 2 109 Training.

The Department has developed a Draft National Plan for Post Education and Training (PSET) from the White Paper, which will be an implementation plan with measurable targets for each sub-system of the sector.
The main policy objectives are: • A post-school system that can assist in building a fair, equitable, non-racial, non-sexist and democratic South Africa; • A single, coordinated post-school education and training system, expanded access, improved quality and increased diversity of provision; and • A post-school education and training that is responsive to the needs of individual citizens, employers in both public sectors, as well as broader societal and development objectives.

2.1.3.
2.1.3.

Medium-Term Strategic Framework (MTSF) 2019 – 2024 The 2019 – 2024 MTSF is a five-year strategic plan of Government, and forms the second five- year implementation phase of the NDP.

The Department of Higher Education and Training is responsible for contributing to the realisation of the policy priorities as outlined in the MTSF Priority 3: Education, Skills and Health.
For the 2020 – 2025 planning period, the Department will focus on these outcomes as follows: • Expanded access to PSET opportunities; • • Improved success and efficiency in the PSET system; Improved quality of PSET provisioning; • A responsive PSET system; and • Excellent business operations within the DHET In implementing Priority 3, the Department of Science and Innovation, the Department of Employment and Labour and the Department of Agriculture, Land Reform and Rural Development support the work of the Department.
2.1.4.

2022 State of the Nation Address (SONA) One of the key focus areas of the February 2022 SONA is a comprehensive social compact to grow the economy, create jobs and combat hunger.

Additionally, it addresses critical priorities for the Higher Education and Training sector.
In response to the huge challenge of youth unemployment 3 110 the country faces, the President announced that the Department of Higher Education and Training (DHET) will place 10 000 unemployed Technical and Vocational Education and Training (TVET) college graduates in workplaces from April 2022.
The President further appealed to the private sector to support measures relating to youth employment and, wherever possible, to drop experience as a hiring requirement and give as many young people as possible their first job.

Additionally, infrastructure projects will be prioritised to support economic growth and better livelihoods, especially in energy, roads and water management.

The Infrastructure Fund is at the centre of this effort, with a R100 billion allocation from the fiscus over 10 years.
The Infrastructure Fund is now working with state entities to prepare a pipeline of projects with an investment value of approximately R96 billion in student accommodation, social housing, telecommunications, water and sanitation and transport.

3.
2022/23 MEDIUM-TERM EXPENDITURE FRAMEWORK (MTEF) BUDGET 3.1.Overview and assessment of the 2022/23 MTEF Budget and the 2022/23 Annual Performance Plan (APP) performance targets Table 1: Summary of the 2022/23 overall budget allocation and expenditure estimates Budget Nominal Increase / Decrease Real Increase / Decrease Nominal Percent change in Real Percent change in 2021/22 2022/23 2023/24 2024/25 2021/22- 2022/23 2021/22- 2022/ -146,8 3.25% -1.20% Programme R million Programme 1: Administration Programme 2: Planning, Policy and Strategy Programme 3: University Education Programme 4: Technical and Vocational Education and Training 4 111 Programme 5: Skills Development Programme 6: Community Education and Training 450,0 421,6 -28,4 -46,6 -6.31% -10.35% 2 365,8 2 481,9 116,1 9,2 4.91% 0.39% Sub-total 97 889,0 109 514,9 11 625,9 6 909,9 11.88% 7.06% Direct Charges against National Revenue Fund 18 932,8 20 619,3 1 686,5 798,6 8.91% 4.22% Total 116 821,8 130 134,2 13 312,4 7 708,5 11.40% 6.60% 3.2.
Overview and assessment of the 2022/23 MTEF budget allocation per programme and the 2022/23 performance targets Over the MTEF period, the Department’s allocation amounts to R409,445 billion, including direct charges against the National Revenue Fund.

For the 2022/23 financial year, the Department received a budget of R130,134 billion, which comprises R109,514 billion of voted funds and R20,619 billion of direct charges.

The total budget increased by R13,312 billion or 11.40% in nominal terms.
When considering inflation-adjusted, the allocation increased by R7,708 billion or 6.60% the budget is projected to grow at an average growth rate of 7.2% between 2021/22 and 2024/25.

The voted funds, excluding direct charges, increased with inflation-adjusted by R6,909 billion or 7.06%.

Programmes 2: Planning, Policy and Strategy and 3: University Education received the highest budget increases at 121.11% and 10.50%, respectively in 2022/23.
The increase is attributed to the additional allocation towards NSFAS to address the budget shortfall, new funding amounting to R600 million towards infrastructure for student housing and additional allocation for the Presidential Youth Employment Intervention.

The Department’s budget is dominated by transfers and subsidies, which accounts for 91,18% of the total budget, including direct charges against the National Revenue Fund.
For the 2022/23 financial year, the allocation for transfers and subsidies amounts to R118,657 billion, of which R65,403 billion is towards Departmental agencies as follows: R47,354 billion to NSFAS for 5 112 student bursaries and administration, R21,338 million to Education, Training and Development Practices Sector Education and Training Authority (ETDP SETA); R81 million to SAQA; R74,486 million to the CHE; R28,506 million to the QCTO; R123,972 million for Public Service Sector Education and Training Authority (PSETA); R4,223 billion for the National Skills Fund (NSF) and R16,495 billion for the SETAs.
An amount of R48,310 billion is toward Higher Education institutions, universities, TVET and CET colleges.

The Allocation for spending on compensation of employees amounts to R10,775 billion.

The bulk of the budget for the compensation of employees is allocated to TVET colleges, followed by the CET colleges.

The goods and services allocation amounts to R678,0 million.

goods and services budget is projected to decrease slightly to R672,817 million in 2023/24.
Below are responses from the Minister of Finance to the 2021 Budgetary Review and Recommendation Report (BRRR) of the Committee.

• The Committee noted that with the current funding for ministerial approved programmes at 62 per cent, the department will not be able to meet the enrolment target as per the National Development Plan (NDP).

The committee recommended that consideration be made toward progressively injecting additional funds to achieve the 80 per cent funding.
Minister of Finance’s response: The National Treasury acknowledges this recommendation.

In light of the limited resources available to Government, the Department of Higher Education and Training has had to tailor enrolment funding for the technical and vocational education and training colleges to align it to the funding available.

Should the government’s fiscal position improve, the department will be considered for additional resources.

The Committee notes the response.


• The Committee recommended additional funding towards the Community Education and Training (CET), especially given the high rate of youth unemployment and the growing number of youths not in education, employment or training.

6 113 Minister of Finance’s response: The National Treasury shares the committee’s concern about the high rate of youth unemployment and the need to provide opportunities for young people.
At present, enrolment at CET colleges is relatively low because of low demand rather than limited funding.

Improving efficiency, including providing more relevant courses, is likely to encourage more young people to enrol at CET colleges.

• The Committee implored the National Treasury to consider additional funding for the National Student Financial Aid Scheme (NSFAS) to avert the instability and unfortunate loss of lives experienced at the beginning of the 2021 academic year.
Minister of Finance’s response: Cabinet is engaging with input from the Ministerial Task Team on Student Funding to find a sustainable solution to the increasing demand to provide fee‐free higher education funding.

Funding of the current model has been supplemented by an additional allocation of R32.6 billion over the medium term.
The Committee welcomed the additional funding for student funding, which will bring stability within the sector and will further ensure that guidelines for the DHET Bursary to guide the allocation of funds are published on time.
• The Committee requested that consideration for additional funding should be made to increase administrative expenditure of the NSFAS as the current administrative budget imposes limitations on the improvements that the Scheme can implement to improve efficiencies, including ICT challenges.

Minister of Finance’s response: The Department of Higher Education and Training has reprioritised R65 million from savings on unfilled posts in 2021/22.
The funds will be used by NSFAS to address its information and communications technology challenges.

Further savings may be found by addressing inefficiencies in NSFAS’s current operations.

The Committee welcomed the reprioritisation of R65 million towards NSFAS administration to address the ICT related challenges.

However, NSFAS has reported that it has requested R200 7 114 million to effect necessary improvements in the ICT systems and processes and to ensure that the systems are fit for purpose.
• The Committee recommended that the National Treasury considers the South African Qualifications Authority (SAQA)’s request for additional funding so that the entity can fulfil its mandate and deliver services within the set turnaround times.

Minister of Finance’s response: The Department of Higher Education and Training has reprioritised funding from its baseline to allocate an additional R10.6 million to SAQA over the medium‐term expenditure framework (MTEF) period.
The Committee welcomed the additional allocation to SAQA to implement its digitisation and automation projects.

3.2.1.

Programme 1: Administration The programme provides strategic leadership, management and support services for the Department.

The Programme has five budget sub-programmes, namely, Department Management, Corporate Management Services, Office of the Chief Financial Officer, Internal Audit and Office Accommodation.

3.2.1.1.
3.2.1.1.

Overview and assessment of the 2022/23 MTEF budget allocation The total budget over the medium-term allocation to Programme 1 amounts to R1.5 billion, of which R493.7 million is set aside for the 2022/23 financial year.

The programme’s budget accounts for 0,45% of the Department’s total voted funds.

The budget increased by R9,0 million or 1.95% from the previous financial year’s adjusted appropriation allocation of R463 million when considering inflation-adjusted.
The allocation is projected to decrease to R489,7 million in 2023/24.

Sub-programme 2: Corporate Management Services receives 49.96% or R246,7 million of the programme’s total budget.

The second highest allocation at 23.33% or R115,2 million is in sub- programme 3: Office of the Chief Financial Officer, followed by sub-programme 6: Office 8 115 Accommodation at 16.85% or R83,2 million.
the budget for the Office Accommodation sub- programme decreased nominally by R9,2 million from R88,8 million in 2021/22.

The allocation for spending on compensation of employees and goods and services for the 2022/23 financial year amounts to R268,3 million and R217,9 million, respectively.

Both the allocations for compensation of employees and goods and services are projected to decrease marginally to R265,8 million and R215,9 million in 2023/24, respectively.
In terms of spending on goods and services per line item, allocation for computer services has increased significantly from R37,3 million in 2021/22 to R62,0 million in 2022/23.

The allocation for computer services is projected to decrease in the outer two years of the MTEF period to R52,9 million and R54,9 million, respectively.

Notably, allocation for spending on consultants: Business and Advisory services decreased significantly by R20 million from R30,8 million in 2021/22.

3.2.1.2.
3.2.1.2.

Overview and assessment of the 2022/23 performance targets The programme is responsible for the MTSF outcome focusing on Excellent business operations within the DHET.

For the 2022/23 financial year, there are seven (7) targets.
The focus during the financial will be on ensuring that the vacancy rate remains below 10%; 80% of the disciplinary cases are resolved within 90 days; maintaining network connectivity at 98% and above to enable excellent business operations within the Department, payment of 100% valid invoices within 30 days and ensuring the achievement of a clean audit outcome from the Auditor-General.

3.2.2.
3.2.2.

Programme 2: Planning, Policy and Strategy This programme provides strategic direction in the development, implementation and monitoring of Departmental policies and the Human Resource Development Strategy for South Africa.

The programme has six budget sub-programmes, namely, namely, Programme Management; Human Resource Development Council of South Africa; Policy, Planning, Monitoring and Evaluation; International Relations; Legal and Legislative Services and Social Inclusion and Quality.

3.2.2.1.
3.2.2.1.

Overview and assessment of the 2022/23 MTEF budget allocation Over the MTEF period, the programme’s allocation amounts to R13,684 billion, and for the 2022/23 financial year, the allocation amounts to R4,912 billion.

The programme’s budget increased due to the shift in infrastructure development functions and budget allocations from 9 116 University Education and Technical and Vocational Educational and Training (TVET) programmes to programme 2: Planning, Policy and Strategy.
The programme’s budget accounts for 4.49% of the Department’s total voted funds.

The budget is projected to decrease in the outer two years of the MTEF period to R4,442 billion and R4,328 billion, respectively.

The bulk of the programme’s budget at 95.68% (R4,700 billion) is allocated to sub-programme 3: Policy, Planning, Monitoring and Evaluation.
This sub-programme monitors and evaluates the policy outputs of the department; coordinates research in the fields of higher education and training; and ensures that education policies, plans and legislation are developed into systems.

The budget allocation for sub-programme 6: Social Inclusion and Quality decreased by R12,2 million from R162,8 million in 2021/22 to R150,6 million in 2022/23.
It is concerning that the sub-programme that is responsible for promoting access to open and e‐learning opportunities, providing career development services, promoting and monitoring social inclusion and equity in the post‐school education and training system and advancing the implementation of the national qualifications framework received budget cuts for the 2022/23 financial year.
Similarly, there is a budget reduction from R9,1 million in 2021/22 to R8,6 million in 2022/23 in sub-programme 1: Programme Management: Planning, Policy and Strategy, which manages delegated administrative and financial responsibilities, and coordinates all monitoring and evaluation functions in the programme.
The allocation for spending on current payments in 2022/23 amounts to R141,8 million, of which R108,5 million is allocated for spending on compensation of employees and R33,3 million on goods and services.

The allocation for compensation of employees is projected to decrease slightly to R107,9 million in 2023/24.

This is a concern given that the Department has planned to establish an Infrastructure Development Coordination Unit.
The Departments reported that R10,569 million and R21,783 million were reprioritised from Goods and Services, respectively.

The reprioritisation was to cater for the South African Qualifications Authority (SAQA)’s automation and digitisation of its manual processes and to Higher Health to cater for addressing preventative activities on Gender-Based Violence in the CET sector.

10 117 An amount of R4,767 billion is allocated for transfers and subsidies.
The allocation for transfers and subsidies is projected to decrease in the outer two years of the MTEF period to R4,295 billion and R4,174 billion.
Of the allocation for transfers and subsidies for the 2022/23 financial year, R81,2 million is allocated to the Departmental agencies: South African Qualifications Authority, and R4,3 million to foreign governments and international organisations (R0,7 million: India- Brazil- South African trilateral and R3,6 million to the Commonwealth of Learning and R20,6 million is allocated to Higher Health.
For the 2022/23 financial year, an amount of R4,661 billion has been allocated for spending on capital expenditure.
Of the R4,661 billion allocations, R1,105 billion is for the University of Mpumalanga: R663,0 million and Sol Plaatje University: R442,0 million; University infrastructure and efficiency grant: R2,245 billion; TVET infrastructure and efficiency grant: R710,5 million and R600 million for infrastructure for student housing at the Tshwane University of Technology, the University of KwaZulu-Natal, Gert Sibande and Majuba TVET colleges.
Notably, the TVET infrastructure and efficiency grant is projected to decrease in the outer two years of the 2022/23 MTEF period from R710,5 million to R541,9 million and R566,3 million in 2023/24 and 2024/25, respectively.

Similarly, the University infrastructure and efficiency grants are also projected to decrease marginally from R2,245 million in 2022/23 to R2,179 million in 2023/24.

3.2.2.2.
3.2.2.2.

Overview and assessment of the 2022/23 performance targets The programme supports the Department’s work toward achieving the DHET’s five MTSF Outcomes, namely, An integrated and coordinated PSET System, Expanded access to PSET opportunities, Improved success and efficiency of the PSET System, Improved Quality of PSET provisioning and a responsive PSET System.

Twenty-three targets are planned under this programme for the 2022/23 financial year.
In supporting an integrated and coordinated PSET System, the programme will Gazette the revised Recognition of Prior Learning Coordination Policy for public comments; submit to the Minister policy brief on articulation between TVET and universities for approval; and have the National Qualifications Framework Amendment Bill approved by Parliament.
11 118 In line with the function and budget allocation shifts, the infrastructure-related performance indicators and targets have been shifted from the University Education and TVET programmes to the Planning, Policy and Strategy programme.
In working toward expanded access to PSET opportunities, the programme will, amongst others, submit to the Minister a plan for the establishment of new institutions, based on a feasibility study for approval; submit to the Minister revised Policy on Norms and Standards for student housing for approval; and develop a Multifaceted student accommodation strategy for approval by DG.
The programme will further produce various oversight reports on the following: Implementation of the Infrastructure Development Support Programme for PSET; Imbali Precinct projects completed in collaboration with the Durban University of Technology (DUT); the establishment of a Multi-Purpose Centre in Giyani; and the feasibility study for the development of a satellite of the University of Zululand campus in Ulundi; progress toward the achievement of Macro Infrastructure Framework milestones.
The programme plans to enter into two new agreements on cooperation in higher education and training; produce a report on the implementation of Social Inclusion and a report on Gender Equality and Gender-Based Violence policy framework for the PSET System.
The programme will also support improved success and efficiency of the PSET and the focus will be on publishing two reports on Statistics on PSET and producing a draft PSET monitoring report; producing a report on the implementation of the National Integrated Career Development Service With respect to the improved quality of the PSET System, the programme will focus on developing a policy brief on E-learning/Open Learning Strategy in PSET; developing TVET colleges infrastructure maintenance plan for 2023/24 relating to all (100%) sites of delivery for approval by the Director-General (DG), produce infrastructure delivery plans for universities for approval by DG; and produce a report on the implementation of norms for differentiated infrastructure.
In supporting a responsive PSET system, the programme will submit to the Minister a monitoring report on the implementation of the ERRP for approval.

3.2.3.

Programme 3: University Education 12 119 The programme develops and coordinates policy and regulatory frameworks for an effective and efficient university education system and provides financial and other support to universities, the National Student Financial Aid Scheme, the Council on Higher Education and national institutes for higher education.
The programme has six budget sub-programmes, namely, Programme Management, University Planning and Institutional Funding, University Governance and Management Support, Higher Education Policy Development and Research, Teaching, Learning and Research Development and Universities Subsidies.

3.2.3.1.

Overview and assessment of the 2022/23 MTEF budget allocation Over the medium term, the programme’s budget allocation amounts to R279,779 billion.
For the 2022/23 financial year the allocation amounts to R88,581 billion.

The budget increased by R8,420 billion (10.5% nominal percentage change or 5.75% real percentage change) from R80,161 billion allocated in 2021/22.

The significant increase is due to additional funds allocated toward the National Student Financial Aid Scheme to cater for the budget shortfall to fund students from poor and working-class families.
The Minister of Finance, Mr E Godongwana, announced during the budget speech on 22 February 2022, that the Government will make an additional allocation of R36,6 billion for financial support to current bursary holders and first-year students under NSFAS.
Sub-programmes 3: Institutional Governance and Management Support, which is responsible for monitoring and supporting institutional governance management and provides sector liaison services and sub-programme 6: University Subsidies received the bulk of the increase at R44,493 billion and R44,012 billion, respectively.

The allocation for spending on compensation of employees for the 2022/23 financial year amounts to R90,6 million and 8,8 million for goods and services.
The bulk of the programme’s budget, R88,481 billion or 99,8% is for transfers and subsidies, of which R44,429 billion is transferred to Departmental agencies and accounts as follows: R44,042 billion to NSFAS, R312,6 million to NSFAS: Administration and R74,5 million to the Council on Higher Education.

13 120 Notably, the allocation to the NSFAS Administration decreased from an adjusted budget of R367,8 million in 2021/22 to R312,6 million in 2022/23.
The allocation for spending on Administration is projected to increase marginally to R313,8 million and R327,9 million in 2023/24 and 2024/25 financial years.

For the 2022/23 financial year, subsidies to higher education institutions amount to R44,010 billion.

3.2.3.2.
3.2.3.2.

Overview and assessment of the 2022/23 performance targets The programme supports the Department in its intentions toward achieving the expanded access to PSET opportunities; improved success and efficiency of the PSET system; improved quality of PSET provisioning; and a responsive PSET system.

The programme has 33 targets for 2022/23.
On expanded access to PSET opportunities, the programme will review the enrolment planning statement for the cycle 2023 – 2025 for universities, produce a report on the achievement of the Ministerial enrolment planning targets, submit to the Minister for approval of a Fee Regulation, submit to the Minister for approval the updated guidelines for the implementation of the DHET Bursary Scheme at public universities and have 1 098 000 students enrolled at public universities.
In contributing to improved success and efficiency of the PSET System, the programme will ensure, amongst others, that 227 000 students complete a university qualification, the number of graduates as follows: 11 000 in human health sciences, 900 in animal health sciences, 209 000 in initial teacher education, 14 500 masters, 3 350 doctoral graduates.

The programme will work toward improved quality of provisioning.
In the 2022/23 financial year, the programme will support efforts toward contributing to the improved quality of the PSET system.
The focus will be on supporting the filling of 85 new Generations of Academics Programme (nGAP) posts at universities, ensuring that 40 doctoral scholarships are allocated to universities through the University Doctoral Staff Doctoral Programme (USDP) for award to permanent instructional or research staff members 25 will be made to permanent instructional or research staff at universities in the Future Professors Programme.
Regarding a responsive PSET system, the programme will support eight (8) universities to implement student-focussed entrepreneurship development activities.

14 121 3.2.4.

Programme 4: Technical and Vocational Education and Training The programme aims to plan, develop, implement, monitor, maintain, and evaluate national policy, programme assessment practices and systems for TVET colleges.

It also provides financial and other support to TVET colleges and regional offices.
The programme has six budget sub- programmes, namely, Programme Management: TVET, TVET System Planning and Institutional Support, Programmes and Qualifications, National Examinations and Assessment, Technical and Vocational Education and Training Financial Planning and Regional Offices.

3.2.4.1.

Overview and assessment of the 2022/23 budget allocation The programme’s budget over the medium term amounts to R38,520 billion.
For the 2022/23 financial year, the programme is allocated a budget of R12,623 billion.

The allocation increased nominally by R396,9 million from the adjusted budget of R12,226 million in 2021/22.

When factoring in inflation, the programme budget has decreased by 1.20%.

The programme budget is projected to grow at an average growth rate of 2.5% between 2021/22 and 2024/25.

The programme’s budget accounts for 11.53% of the Department’s total voted funds.
Sub-programme 2: TVET System Planning and Institutional Support are apportioned the largest budget amounting to R11,663 billion.
This sub-programme provides support to management and councils, monitors and evaluates the performance of the TVET system against set indicators, develops regulatory frameworks for the system, manages and monitors the procurement and distribution of learning and teaching support materials, provides leadership for TVET colleges to enter into partnerships for the use of infrastructure and funding resources, and maps out the institutional landscape for the rollout of the TVET college system.
The sub-programme’s budget increased nominally by 2.43% from R11,387 billion in 2021/22.

An amount of R644,2 million, which is the second-highest allocation, is apportioned to sub- programme 4: National Examinations and Assessment, followed by sub-programme 6: Regional Offices at R266,5 million.

15 122 The current payments are allocated a budget of R8,296 billion, of which R7,902 billion is for compensation of employees and R393,3 million for goods and services.
The allocation for compensation is projected to grow to R8,003 billion and R8,361 billion in 2023/24 and 2024/24, respectively, whilst allocation for goods and services is projected to decrease slightly to R389,9 million in 2023/24 and increase to R408,4 million in 2024/25.
The bulk of the goods and services allocation amounting to R96,7 million is apportioned to subsistence and travel, followed by R84,4 million for computer services and R65,7 million for consumables: Stationery, printing and office supplies.
The allocation amounting to R4,318 billion is allocated for transfers and subsidies, of which R18,1 million is allocated to Departmental agencies and accounts: Education, Training and Development Practices Sector Education and Training Authority (ETDP SETA) and R4,300 billion, of which R3,877 billion is subsidies to TVET colleges and R423,4 million for the operationalisation of new TVET college campuses.
Notably, the allocation for subsidies to TVET colleges is projected to decrease slightly to R3,819 billion in 2023/24.

3.2.4.2.

Overview and assessment of the 2022/23 performance targets The programme will contribute to the four DHET MTSF outcomes, namely, Expanded access to PSET opportunities, Improved success and efficiency of the PSET System, Improved Quality of PSET provisioning and a responsive PSET System.

For the 2022/23 financial year, the programme has 26 targets.
The focus during 2022/23 will be on expanding access to PSET opportunities, whereby the Department will develop a three-year enrolment plan with differentiation in programmes, establish an additional Disability Student Unit to support students with disabilities in TVET colleges, enrol 580 849 students in TVET colleges, fund 329 554 students through NSFAS, train 800 artisan learners in Centres of Specialisation.

The student enrolments at TVET colleges for the 2022/23 financial year are targeted at 580 849.
Notably, the projected student enrolment target is lower than 610 000 targeted in 2021/22.

During a media briefing on the PSET sector’s state of readiness for the academic year 2022, the Minister, Dr Nzimande reported that the planned 2022 headcount of student enrolments into the ministerial 16 123 approved programmes is 508 000, which is lower than the 2022/21 headcount enrolments funded by the state and TVET colleges from student fees.
This is really concerning, noting that the NDP aims to increase student enrolment in the TVET colleges to 1.25 million by 2030.

The 2019 – 2024 MTSF targets student enrolment of 610 000 at TVET colleges per annum.

However, the enrolment target is 29 151 lower than the MTSF targets.
Of grave concern is that the Minister further reported that the 2022 enrolment planning for the TVET colleges will only be funded by the state at R14,385 billion, with a correlating budget deficit of R165 million or 1.15% funding deficit.

This will adversely impact access to education and training for youth and adults and will adversely impact the production of skills to support economic growth.
The Department, on the one hand, is expanding the sector through building additional TVET college campuses, whilst decreasing headcount enrolment in the sector due to funding challenges.
In contributing to improved success and efficiency of the PSET System, the programme will release examination results to qualifying students within 40-days from the last day of the exams timetable, issue certificates to qualifying candidates following the publication of results, 72 298 TVET college students are targeted to complete N6 qualification, 13 552 TVET college students to complete NC(V) Level 4.
Regarding the improved quality of PSET provisioning, the programme aims to have 70% of TVET college lecturers with professional qualifications, 14% of TVET college lecturing staff will appropriately be placed in industry or exchange programmes, and 100 lectures will participate in project-based lecturer capacity building programmes in engineering (electrical, plumbing and mechanical).
In ensuring a responsive PSET system, the programme will have 25 TVET colleges offering Fourth Industrial Revolution (4IR) aligned skills training, 3 000 lecturers participating in digital literacy programmes, all 50 TVET colleges implementing student-focussed entrepreneurship development programmes and 10 new or revised subjects for TVET colleges approved by the Director-General.

3.2.5.
3.2.5.

Programme 5: Skills Development 17 124 This programme promotes and monitors the National Skills Development Strategy (NSDS).

It develops skills development policies and regulatory frameworks for an effective skills development system.

The programme has five budget sub-programme, namely, Programme Management: Skills Development, National Artisan Development, Sector Education and Training Authority Coordination, National Skills Authority Secretariat and Quality Development and Promotion.

3.2.5.1.
3.2.5.1.

Overview and assessment of the 2022/23 budget allocation Over the medium-term, the programme’s budget amounts to R1,178 billion.

For the 2022/23 financial year, the allocation amounts to R421,6 million, which accounts for 0.38% of the Department’s total voted funds.

The allocation decreased by R28,4 million or 6.3% in nominal terms from the R450,0 million in 2021/22.
The budget allocation is projected to increase to R427,5 million in 2023/24 and to decrease significantly to R328,9 million in 2024/25.

Overall, the allocation is projected to decrease by 9.9% between 2021/22 and 2024/25.

Sub-programme 2: Sector Education and Training Authority Coordination receives the bulk of the programme’s budget at 61.97% (R261,2 million).
The sub-programme supports, monitors and reports on the implementation of the national skills development strategy at the sectoral level by establishing and managing the performance of service‐level agreements with SETAs and conducting trade tests at the Institute for the National Development of Learnerships, Employment Skills and Labour Assessments (INDLELA).
The second highest allocation of R108,7 million, which accounts for 25.79% of the programme’s total budget, is apportioned to sub-programme 5: National Artisan Development.

This sub-programme manages and monitors the development of artisans.

Notably, this sub-programme got a huge budget decrease amounting to R45,6 million or 29.55% in nominal terms from R154,3 million in 2021/22 adjusted appropriation.
The budget cuts are very concerning given that the Department will implement the National Skills Development Strategy to support the Economic Reconstruction and Recovery Plan (ERRP) through producing relevant skills.

The allocation for current payments amounts to R166,9 million, of which R149,4 million is allocated to the compensation of employees and R17,5 million for goods and services.
Notably, 18 125 the allocation for compensation for employees is projected to decrease to R146,8 million in 2023/24 and to increase marginally to R150,5 million in 2024/25.

The allocation for goods and services decreased significantly from an adjusted appropriation of R55,2 million in 2021/22 to R17,5 million in 2022/23 and it is projected to grow marginally to R18,1 million and R18,9 million in 2023/24 and 2024/25, respectively.
The allocation for spending on transfers and subsidies amounts to R252,5 million, which increased slightly by R3,3 million from an adjusted appropriation of R249,2 million.

The allocation is projected to increase to R260,2 million in 2023/24 and decrease to R157,0 million in 2024/25.
An amount of R28,5 million is allocated to the Quality Council for Trades and Occupations (QCTO) and R124,0 million is allocated to the Public Service Sector Education and Training Authority (PSETA) and R100 million to the National Skills Fund.

3.2.5.2.
3.2.5.2.

Overview and assessment of the 2022/23 performance targets This programme contributes to the four DHET MTSF Outcomes, namely, Expanded access to PSET opportunities, Improved success and efficiency of the PSET System, Improved Quality of PSET provisioning and a responsive PSET System.

For the 2022/23 financial year, the programme has 12 targets.
In expanding access to PSET opportunities, the programmes aims to have 107 00 learners or students placed in work-based learning, register 148 000 learners in skills development programmes, and enrol 23 000 in artisanal programmes.

With respect to improved success and efficiency of the PSET system, 21 000 artisans are targeted to be found competent, 32 550 learners are targeted to complete learnerships, 105 000 learners to complete skills programmes.
In contributing to improved quality of PSET provisioning, the programme aims to have 95% of SETAs that meet a good standard of governance, 100% allocated SETA mandatory grants paid to employers.

The programmes will contribute to a responsive PSET system by ensuring the 40-day average lead time from qualifying trade test applications received until the trade test is conducted, 21 SETAs will be assessed to have developed credible Sector Skills Plans (SSPs).
The programme will produce a monitoring report on the implementation of the Skills Strategy.

19 126 3.2.6.

Programme 6: Community Education and Training (CET) The programme aims to plan, develop, implement, monitor, maintain and evaluate national policy, programme assessment practices and systems for community education and training.

Provide financial and other support to community education and training colleges.
The programme has four budget sub-programmes, namely, Programme Management: Community Education and Training; Community Education and Training Systems, Planning, Institutional Development and Support; Community Educating and Training College Financial Planning and Management; and Education, Training and Development Assessment.

3.2.6.1.

Overview and assessment of the 2022/23 budget allocation The CET programme’s budget over the MTEF period amounts to R7,735 billion.
For the 2022/23 financial year, the programme’s budget amounts to R2,481 billion, which constitutes 2.27% of the Department’s total voted funds.

The budget increased by R9,3 million, or 0.39% when considering inflation-adjusted, from an adjusted appropriation of R2,365 billion in 2021/22.

The budget is projected to grow at an average growth rate of 4.3% between 2021/22 and 2024/25.
Sub-programme 2: Community Education and Training System Planning, Institutional Development and Support is apportioned the bulk of the budget at 89.96% (R2,232 billion).
The sub-programme is responsible provides support to management and councils, monitors and evaluates the performance of the CET system, develops regulatory frameworks for the system, manages and monitors the procurement and distribution of learning and teaching support materials, provides leadership for CET colleges to enter into partnerships for the use of infrastructure for college site‐hosting centres and the funding of these partnerships, maps an institutional landscape for the rollout of the CET system, and is responsible for the planning and development of CET infrastructure.
The sub-programme budget is projected to grow at an average growth rate of 4.6% between 2021/22 and 2024/25.

20 127 Sub-programme 3: Community Education and Training Colleges Financial Planning and Management receives the second highest allocation, amounting to R228,8 million or 9.22% of the programme’s total budget.
This sub-programme The programme sets up financial management systems; develops the financial management capacity of CET colleges; manages and determines the fair distribution of funding to CET colleges in accordance with funding norms and standards; monitors compliance with supply chain management policy; and ensures the timely submission of audited performance information, annual financial statements, and quarterly and annual reports.
The allocation for spending on current payments for the 2022/23 financial year amounts to R2,263 billion, of which R2,256 billion is for the compensation of employees and R7,2 million for goods and services.

The allocation for spending on compensation of employees accounts for 90.89% of the CET programme’s total budget.
The budget allocation for compensation of employees is projected to increase in the outer two years of the MTEF period to R2,349 billion and R2,454 billion in 2023/24 and 2024/25, respectively.

Notably, the budget allocation for goods and services is projected to decrease in the outer two years of the MTEF period to R4,6 million and R4,8 million in 2023/24 and 2024/25, respectively.
The decrease in the allocation for goods and services is due to the reprioritisation of funds to Higher Health to cater for addressing preventative activities on Gender-Based Violence (GBV) in the CET sector.

An amount of R218,4 million is allocated for transfers and subsidies, of which R215,2 million is for CET colleges and R3.2 million is for Departmental agencies and accounts: ETDP SETA.

The Department reported that an amount of R2,548 million was reprioritised toward the CET funding model.

3.2.6.2.
3.2.6.2.

Overview and assessment of the 2022/23 performance targets The CET programme contributes to the three of the five DHET MTSF Outcomes: Expanded access to PSET opportunities, Improved success and efficiency of the PSET system, and Improved quality of the PSET.

For the 2022/23 financial year, the programme has 10 targets.
21 128 In contributing toward expanded access to PSET opportunities, the programme will review the five-year enrolment plan for CET colleges and get it approved by the Minister, have a sustainable funding model for CET colleges approved by the Director-General and will also enrol 266 424 students.
With respect to improved success and efficiency of the PSET system, 40 000 college students are targeted to complete General Education and Training Certificate (GETC) Level 4; two new programmes and qualifications will be offered in CET colleges; produce a report on the implementation of open of access learning and teaching support materials (LTSM) for students in CET colleges.
To improve the quality of the PSET system, the Department targeted to have 95% of the CETCs that meet standards of good governance, 900 CET college lecturers will be trained, 100% of CET colleges compliant with the policy on the conduct and management of examinations and assessment, and 35 pilot community learning centres will be accredited.

4.
4.

ENTITIES OF THE DEPARTMENT OF HIGHER EDUCATION AND TRAINING The Committee considered and assessed the 2022/23 Annual Performance Plans and the MTEF Budget allocations of the NSFAS, CHE, SAQA and QCTO.

These entities are funded through parliamentary grants (voted funds) and also generate other income through services they provide, fundraising.

The NSFAS generates other revenue from loan recoveries from previous beneficiaries and management fees from managing funds from other funders.

4.1.
4.1.

NATIONAL STUDENT FINANCIAL AID SCHEME (NSFAS) 4.1.1.

Mandate of the NSFAS The mandate of the NSFAS is informed by the Constitution of the Republic of South Africa, 1996, section 29(1) (b) of the Bill of Rights of the Constitution, the National Student Financial Act, 1999 (Act No.

56 of 1999 as amended), the Higher Education Act, 1997 (Act No.

101 of 1997 as amended), the Continuing Education and Training Act, 2006 (Act No.

16 of 2006), Public Finance Management Act, 1999 (Act NO.
1 of 1999), Treasury Regulations, 2005, Public Audit Act, 2004 (Act No.

25 of 2004), and the National Credit Act, 2005 (Act No 34 of 2006).

In addition to the core legislative mandate, the work of the Entity is informed by key government policies; namely, the NDP, the White-Paper for PSET, and the MTSF 2019 – 2024.
22 129 The NSFAS’s main responsibility is to administer loans and bursaries and allocate these to eligible students, developing criteria and conditions for the granting of loans and bursaries to eligible students in consultation with the Minister of Higher Education (“the Minister”), raising funds, recovering loans, maintaining and analysing a database, undertaking research aimed at better utilisation of financial resources and for advising the Minister on matters relating to student financial aid.
The NDP commits the NSFAS to provide all students who qualify for the NSFAS with access to full funding through loans and bursaries to cover the costs of tuition, books, accommodation and other living expenses.

In terms of loan recoveries, the NDP enjoins the NSFAS to recover through an arrangement with the South African Revenue Service.

Furthermore, MSTF has identified Seven Apex Priorities, including Priority 3: Education, Skills and Health.
There are four outcomes; namely, expanded access to PSET opportunities, improved success and efficiency of the PSET system, improved quality of the PSET provisioning and a responsive PSET system.

The NSFAS directly contributes to Outcome 1: Expanded access to PSET opportunities.

The MTSF commits the NSFAS to fund 420 000 and 400 000 University students and of TVET college students by 2024, respectively.

4.1.2.
Overview of the Revised 2020/21 – 2024/25 Strategic Plan Table 2: Amendments to the Strategic Plan Reference to current strategic plan Strategic Outcome 1 Alternative pool of funding available for eligible students Revisions to the approved strategic plan KPI 1.1 Amount of funds (Rand value) raised from new funders (“new” removed) Reasons for the revisions KPI 1.1 Amount of funds (Rand value) raised from funders (refined) technical Indicator description The title name of the indicator has been refined.
The includes funding from core and non-core funders.
The wording “new funders” has been removed and replaced by funders 23 130 Strategic Outcome 2 A sustainable and improved systems for recoveries Strategic Outcome 3 the right Fund correct student, amount at the right time KPI 2.1 Amount of money recovered (Rand value) from NSFAS debtors Revised target: 2022/23 Targets = R388.5m 2023/24 Targets = R396.3m 2024/25 Targets = R404.2m KPI 3.3: Percentage of assistive devices provided to students with disabilities within 30 days of receipt of claims.
(new) The ongoing Covid-19 pandemic has impacted negatively on recoveries.

The recovery rate has been stagnant due to slow pace of recoveries and unsuccessful debit orders.

The Covid-19 pandemic has contributed the high to unemployment rate in South Africa.

The recent political unrest in KZN and Gauteng due to political challenges has the potential for an economic slowdown in the country.
Key Performance Indicator removed KPI 3.3: Percentage of first-time entry students where bursary accounts are created within 10 days of receipt of registration data from Institutions.

This indicator is removed due to misalignment with the new disbursement model An indicator in respect of students with disabilities has been added Source: NSFAS Annual Performance Plan 2022/23 4.1.3.
Focus over the MTSF period and Strategic Outcomes The Entity has developed two Strategic Outcome Oriented Goals to inform its focus over the MTSF period as follows: Table 3: Strategies over the five-year period Strategies Outcome Oriented Goals Goal 1 An effective, efficient and transparent public entity in providing student financial aid Goal Statement To implement effective, efficient and transparent processes and operations to stakeholder objectives are ensure achieved Goal 2 Increased access to higher education and improved student financial aid environment for poor and working- class To increase access to funding for eligible students by raising funds, and maximising creating a student-centred bursaries model improved communication support for students and a central application process recoveries through loan 24 131 Outcomes Outcome 6 embedded in all behaviour practices - Clean governance Outcome 7 – An optimal organisation that deploys resources efficiently Outcome 1 - Alternative pool of funding available for eligible students Outcome 2 - A sustainable and improved systems for recoveries Outcome 3 - Fund the right student, correct amount at the right time Outcome 4 - Engaged and informed stakeholders Outcome 5 - Research and knowledge management database for improved decision making and stakeholder needs Source: Revised NSFAS Strategic Plan for fiscal years 2020/21 – 2024/25 (Update for 2022/23) 4.1.4.
Overview and assessment of the 2022/23 performance targets NSFAS has two budget programmes, namely, Administration and Student-Centred Model.

For the 2022/23 financial year, the two programmes have a combined 17 targets.

4.1.5.

Programme 1: Administration The programme aims to conduct the overall management, administration, and governance of the entity and to provide efficient and effective support services to sustain the student-centred operating model.

The programme has seven planned targets.


Selected key deliverables for the 2022/23 financial year, amongst others: • Obtain an unqualified audit opinion; • Achieve CGICTAS Level 3; • To determine a baseline on level of maturity with respect to Cyber security; • Award 60% of total procurement value to BBB-EE level 1 service providers; • Fill 90% of approved funded positions; and • Employ 50% women in management positions.

25 132 4.1.5.1.
25 132 4.1.5.1.

Student-Centred Model The programme aims to increase access to funding for eligible students by raising funds, maximising loan recoveries and creating student-centred loans and bursaries through improved communication support for students and the central application process.

The programme further aims to improve the provision of financial aid to an increasing number of eligible students and to improve the efficiency of the application and funding of students.
The programme implements five Outcomes.

The programme has 10 targets.

The focus of the programme in 2022/23 will be to: • Raise R48,3 million from funders; • Recover R388,5 million from NSFAS debtors; • Provide 90% of assistive devices to students with disabilities within 30 days of receipt of claims; • Develop a stakeholder engagement tool and collect a baseline for stakeholders; and • Produce four research reports.

4.1.6.
4.1.6.

Overview and assessment of the 2022/23 MTEF budget allocation The NSFAS budget for the 2022/23 financial year amounts to R48,968 billion (the budget includes approved use of recovered funds for debt collection and administration fees from other funders).

The budget comprises the Entity’s revenue of R1,436 billion or 2,9%, R45,854 billion or 93.64% from DHET Grant and R1,677 billion or 3.42% from other grants.
The overall budget increased significantly by R6,983 billion from R41,985 billion in 2021/22.

The increase is due to additional allocated to cater for the shortfall in the NSFAS budget.

Similarly, the DHET Grant allocation to the NSFAS increased from R38,561 billion in 2021/22 to R45,854 billion in 2022/23.

The DHET grant allocation to the NSFAS is projected to grow in the two outer years of the MTEF period to R47,942 billion and R51,954 billion in 2023/24 and 2024/25, respectively.
Notably, the allocation from other grants decreased marginally from R1,964 billion in 2021/22 to R1,677 billion in 2022/23.

26 133 In terms of projected expenditure for the 2022/23 financial year, the bulk of the projected expenditure of the NSFAS, R49,252 billion is apportioned to programme 2: Student-Centred Model, which is the core mandate of the NSFAS and has 10 targets for the 2022/23 financial year.

The Administration programme is allocated R309,408 million and R1.461 million for capital assets.
The NSFAS projected expenditure is dominated by transfers to institutions (universities and TVET colleges) for student bursaries.

for university and TVET college students, at 96.42% or R47,219 billion.

Compensation for employees is allocated R246,567 million and goods and services R165,472 million.

Accounting expenditure is allocated R1,307 billion.

4.2.

Council on Higher Education (CHE) The mandate of the CHE is premised on the Higher Education Act, 1997 (Act No.
101 as amended) and the National Qualifications Framework Act, 2008 (Act No.

67 of 2008 as amended).
In terms of its mandate as per the two primary legislation, the CHE is responsible for the following: • Advising the Minister of Higher Education and Training on all higher education matters upon request and at its own initiative; • Promoting quality and quality assurance in higher education through its permanent sub- committee, the Higher Education Quality Committee (HEQC), including auditing the quality assurance mechanisms and accrediting programmes offered by higher education institutions; • Monitoring the state of higher education and publishing information regarding developments in higher education regularly, including arranging and co-ordinating conferences on higher education issues; • Developing and managing the qualification sub-framework for higher education, namely, the Higher Education Qualifications Sub-Framework (HEQSF), including the development of qualifications that are necessary for the higher education sector; and • Advising the Minister of Higher Education and Training on matters relating to the HEQSF.
The mandate is further premised on key policies; namely the National Development Plan: Vision 2030, the White Paper for Post-School Education and Training, the National Plan for Higher 27 134 Education, and the Medium-Term Strategic Framework 2019 – 2024: Priority 3: Education, Skills and Health, amongst others.

The CHE has not revised its 2020 – 2025 Strategic Plan.

4.2.1.
4.2.1.

Focus over the MTSF period and Strategic Outcomes The work of the CHE over the MTSF period will continue to be informed by its five Strategic Outcomes; namely, • Strategic Outcome 1: CHE as an effective custodian of the HEQSF.

The entity will manage the development and implementation of the HEQSF policies, qualification standards and data to meet the goals of the NQF, National Plan for PSET (NPPSET) and the NDP.
• Strategic Outcome 2: Comprehensive and coherent quality assurance system for the higher education sector.

Under this Strategic Outcome, the CHE will develop and implement a new Quality Assurance Framework for effective and efficient internal quality assurance (IQA) and external quality assurance (EQA) for the sector.

• Strategic Outcome 3: A reputable centre of intellectual discourse, knowledge generation and advancement.
The CHE will revitalise and strengthen its research, monitoring and advice capabilities.

• Strategic Outcome 4: Governance, compliance and risk management.

The entity plans to set the broad strategic direction, policy and tome for good governance, statutory compliance and risk management of the organisation to support the discharge of its core functions.

• Strategic Outcome 5: Sustainable, responsive and dynamic organisation.
The CHE plans to design and implement an organisational architecture, business processes, capabilities and infrastructure to realise the strategy of the entity.

4.2.2.

Overview and assessment of the 2022/23 performance targets The CHE has four budget programmes, namely: Management of the Higher Education Qualification Sub-Framework (HEQSF) and Quality Promotion; Quality Assurance; Research, Monitoring and Advice, and Corporate.
For the 2022/23 financial year, the four programmes have a combined 48 targets.

28 135 Below are selected programme key deliverables for the 2022/23 financial year: 4.2.2.1.

Programme 1: Management of the HEQSF and Quality Promotion The programme aims to manage the development and implementation of HEQSF policies, qualification standards and data to meet the goals of the NQF, NPPSET and the NDP.
The programme has five budget sub-programmes, namely, Qualifications Standards Development, Data Management; Policy Development and Review; Partnerships and Collaborations; and Quality Promotion and Capacity Development.

The sub-programmes contribute to the overall purpose of the programme stated above.

The programme has 14 targets for 2022/23.


Selected key deliverables for the 2022/23 financial year include, amongst others: • Develop or review three qualification standards; • Initiate four qualifications standard development or review; • 85% of private higher education institutions that have all required sets of data records in the database; • Two data uploads onto the National Learner Records Database (NLRD).
• Competition of Phase 3 in the review and further development: approvals and publication of the updated HEQSF; • Five higher education institutions provided with support with respect to the development and implementation of relevant institutional policies; • Involved in one regional and/or international events and/or forums on qualifications framework, quality assurance and promotion; and • Organise 20 quality promotion and capacity building forums and/or workshops.
The 2022/23 budget allocation amounts to R9,518 million, of which R2,005 million is allocated for spending on compensation of employees and R4,127 million for goods and services.

the bulk of the budget on goods and services, R3,864 million is apportioned to Agency and supported/outsourced services, followed by R3,603 million to travel and subsistence.

29 136 4.2.2.2.
29 136 4.2.2.2.

Quality Assurance The programme contributes toward the fulfilment of the mandate of the CHE as the national authority for quality assurance in higher education.

The programme develops and implements processes to inform, assure, promote and monitor quality in Higher Education Institutions (HEIs).

The programme comprises four budget sub-programmes, namely, Accreditation, Institutional Audits, National Reviews, and Quality Assurance Framework.
This programme aims to significantly streamline the process and improve turnaround times.

The new indicators and targets in the APP have been formulated to give effect to the planned improvement in the performance of the Accreditation function.

For the 2022/23 financial year, the programme has 12 targets.
Selected key deliverables for the 2022/23 financial year include, amongst others: • 85% of applications received that go through the accreditation process and are presented to the HEQC within 12 months from the date of appointment of evaluators; • 95% of site visits undertaken whose reports are presented to the HEQC within 12 months from the date of receipt of reports from site visit panels; • 20 institutional site visits by CHE audit panels, depending on the individual institution’s agreed planning with the CHE; • Eight institutional audit Improvement Plans submitted by institutions, depending on individual institution’s agreed planning with the CHE; • Approve one plan for the QAF-Management Information System; and • Develop five Higher Education Practice Standards.
The programme’s budget allocation for 2022/23 amounts to R28,284 million, which is apportioned to three sub-programmes.

Of this allocation, R14,810 million is for the compensation of employees and R11,094 million for goods and services.

30 137 4.2.2.3.
30 137 4.2.2.3.

Research, Monitoring and Advice The programme aims to revitalise and strengthen the research, monitoring, evaluation and advice capabilities of the CHE in order to advance the realisation of Outcome 3 in the Strategic Plan 2020 – 2025, namely, to make the CHE a reputable centre of intellectual discourse, knowledge generation and advancement on higher education.

The programme comprises three budget sub-programmes, namely, Research, Monitoring and Advice.
There are nine planned targets for 2022/23.

Selected key deliverables for the 2022/23 financial year include, amongst others: • Produce three research reports; • Organise two conferences, colloquia, seminars, or symposium; • Produce four policy briefs or Briefly Speaking articles; • Produce one VitalStats; and • Respond to 100% of requests for advice.
The programme’s 2022/23 budget allocation amounts to R9,524 million, of which R3,861 million is for the compensation of employees and R5,663 million for goods and services.

4.2.2.4.

Programme 4: Corporate The programme provides leadership, oversight, systems, activities and structures that enable the organisation to operate effectively and efficiently in fulfilment of its mandates and in pursuit of its outcomes.
The programme has four budget sub-programmes, namely, Governance, Corporate Services, Finance and Supply Chain Management, and Communications and Stakeholder Relations.

There are 13 planned targets for 2022/23.
Selected key deliverables for the 2022/23 financial year include, amongst others: • Develop or review seven ICT policies, frameworks, guidelines and procedures; • Develop or review eight financial management and supply chain management policies, frameworks, guidelines and procedures; • Organise and hold 22 scheduled governance meetings; • Conclude 80% of activities as per the approved annual ICT Operational Plan; • Offer 15 staff training interventions; 31 138 • Submit four approved expenditure reports to DHET by the compliance date; and • Conclude 80% of activities as per the Communication and Advocacy Plan.
For the 2022/23 financial year, the programme’s allocation amounts to R34,647 million, of which R16,691 million is allocated for the compensation of employees and R17,956 million for goods and services.

4.2.3.

Overview and assessment of the 2022/23 MTEF budget allocation For the 2022/23 financial year, the CHE’s total revenue amounts to R81,973 million.

The revenue increased by R4,777 million from the adjusted appropriation of R77,196 million in 2021/22.
The budget is made up of R74,4 million or 90% from DHET transfers or voted funds and R7,487 million or 9% from the entity’s own revenue (R5,856 million: Private Accreditation – Cost Recovery and R1,631 million: interests, rental income, etc.).

The overall budget is projected to grow in the outer two years of the MTEF period to R90,960 million and R95,044 million in 2023/24 and 2024/25, respectively.
Programme 4: Corporate receives the bulk of the total budget, 42.26% or R34.647 million, followed by programme 2: Quality Assurance, which receives 34.5% or R28.284 million.

Programme 1: Management of HEQSF receives R9.518 million or 11.61%, and programme 3: Research, Monitoring and Advice receives R9.524 million or 11.61%.

The allocation for spending on compensation of employees amounts to R37,039 million and R44,934 million is apportioned for goods and services.

4.3.
4.3.

South African Qualifications Authority (SAQA) SAQA derives its legislative mandate from the National Qualifications Framework Act, 2008 (Act No.

67 of 2008 as amended).
In terms of the Act, SAQA is mandated to, amongst others: • Provide advice, oversee NQF implementation and collaborate with the Quality Councils; • Develop NQF policies and criteria; • Maintain a National Learners’ Records Database (NLRD), and provide an evaluation and advisory service with respect to foreign qualifications; 32 139 • Undertake research, collaborate with international counterparts, and drive the communication and advocacy strategy to promote the understanding of the NQF architecture; and • Perform any function consistent with the NQF Act that the Minister of Higher Education and Training may determine.
SAQA further derives its policy mandate from the NDP Vision 2030, the White Paper on PSET, including the National Plan for the Post-School Education and Training and the Department’s five-year Strategic Plan.

Additionally, SAQA’s mandate is further informed by the White Paper for Post-School Education and Training, the National Plan for PSET and the recent Economic reconstruction and Recovery Plan (ERRP).
The MTSF does not specify any direct contribution from SAQA to the five-year outcomes, outcome indicators and targets.

The DHET recommended that the SAQA, as the custodian of the NQF, should focus their work toward contributing to the achievement of the three outcomes, improved quality; expanded access (Recognition of Prior Learning and Articulation) and improved efficiency.

4.3.1.
4.3.1.

Focus over the MTSF period and Strategic Outcomes SAQA aims to have an integrated and transparent national qualifications framework that facilitates access to, and mobility and progression within education, training and career paths.
Over the MSTF period, the work of the Entity will be informed by five Outcomes; namely, • Outcome 1: A dynamic NQF that is responsive, adapts to and supports the changing needs of life-long learning • Outcome 2: Visionary and influential leadership that drives a clear, evidence-based NQF Agenda • Outcome 3: Well-articulated quality-assured-qualifications and relevant professional designations that instil trust and meet the needs of the people.
• Outcome 4: A competent and capable team, dedicated and resourced to develop and maintain the NQF.

• Outcome 5: Stakeholders and role-players who are aligned to deliver on the NQF.

33 140 4.3.2.

Overview and assessment of the 2022/23 performance targets SAQA has four budget programmes under which the activities toward achieving the Strategic Outcomes are implemented.
The programmes are Administration, Registration and Recognition, ICT and NQF Management Information Systems, Authentication and Ratification Services and Research.

Twenty-five targets are planned for the 2022/23 financial year.

4.3.2.1.

Programme 1: Administration The programme covers the activities under the Office of the CEO; Finance and Administration; and Governance, People, and Strategy divisions.

Its purpose is to support the operations of SAQA.

The programme has 10 planned targets for 2022/21.


It covers the activities of the Executive office and the following Directorates: Finance and Administration; Human Resources; Information Technology; and Advocacy, Communication and Support.
The programme contributes to the achievements of three of the five outcomes, to have visionary and influential leadership that drives a clear, evidence-based NQF Agenda; having a competent and capable team, dedicated and resourced to further develop and maintain the NQF and to have stakeholders and role-players who are aligned to deliver on the NQF.
Selected key deliverables for the 2022/23 financial year include, amongst others, to: • • Identify and implement two initiatives to promote the South African NQF; Implement SAQA’s Implementation Plan for the Addis Convention; • Continue to implement the plan to generate funds through alternate revenue streams; • Report on the effectiveness of the System of Collaboration; • Develop a Monitoring and Evaluation protocol for the System of Collaboration; and • Advice the executive authority on the NQF matters as required; Ensure that the NQF MIS incorporating the NLRD contains 22 000 000 learners with achievements.
The programme’s budget for 2022/23 amounts to R53,601 million, or 46.4% of SAQA’s total budget.

The allocation to this programme decreased by R2,984 million from R56,587 million in 2021/22.

34 141 4.3.2.2.

Programme 2: Registration and Recognition The programme is responsible for registering qualifications and part-qualifications, recognising professional bodies, and registering professional designations.

This programme contributes to two of the five Outcomes and has three targets for 2022/23.
Deliverables for the 2022/23 financial year include, amongst others, to: • Produce a concept paper on the registration of national qualifications on the NQF in consultations with the three Quality Councils (QCs) and the DHET, and • Use research findings to amend the Policy and Criteria for Recognising a Professional Body and Registering a Professional Designation if required.

The total budget allocation for this programme for 2022/23 is R11,021 million.
The allocation to this programme increased by R474 000 from R10.557 million in 2021/22.

4.3.2.3.

ICT and NQF MIS The programme covers the work of the ICT unit and the NQF MIS sub-unit incorporating the NLERD.

It is responsible for ensuring effective ICT governance and the aligned development of ICT infrastructural resources to support the achievement of organisational objectives and business processes.
The ICT unit drives SAQA’s plans to embrace the Fourth Industrial Revolution by enabling the automation of operations across the organisation and developing end-to-end workflows where required.

Owing to budget cuts, the ICT unit will not pursue any ICT development in this financial year, unless budget permit.

The focus will be on keeping current systems operational and investigating the move to the Microsoft platform from International Business Machines Corporation (IBM).
This programme contributes to two of the five Outcomes.

Six targets are planned under this programme.
Selected key deliverables for the 2022/23 financial year include, amongst others, • Develop an end-to-end electronic system for the evaluation of foreign qualifications; • Develop a funding proposal for the digitisation of legacy achievement records; 35 142 • Ensure that the QCs load learner achievement on the NQF MIS; • Publish the Policy on the Misrepresentation of Qualifications if the President proclaims the NQF Amendment Act, 2019, and • Update the Register of Misrepresented Qualifications.
The programme’s budget for 2022/23 is R18,945 million, which decreased by R5,733 million from R24,678 million in 2021/22.

4.3.2.4.

Programme 4: Authentication and Ratification Services The programme is responsible for verifying South African qualifications and evaluating foreign qualifications.

It also locates foreign qualifications on the South African NQF by comparing them to the relevant national qualifications.

There are two planned targets for 2022/23.


The programme will complete all compliant applications received for evaluation of foreign qualifications within three months.

It also plans to complete all compliant verification requests received for the verification of South African qualifications within 25 working days.

The 2022/23 budget allocation for the programme is R24,389 million, which increased marginally by R1,048 million from the previous year allocation’s allocation of R32,341 million.

4.3.2.5.
4.3.2.5.

Research The programme is responsible for conducting evidence-based research to track the development and implementation of the NQF and to evaluate the impact of the NQF on the people in South Africa.

The programme has four targets.


Key deliverables for the 2022/23 financial year include, amongst others, to: • Review one NQF policy; • Produce the final 2021 NQF Impact Study Report; and • Provide the Minister with a report on the progress made by SAQA and the QCs in implementing the Articulation Policy.

36 143 The allocation to this programme amounts to R5,232 million, which increased R224 000 from the previous year allocation of R5,008 million.

4.3.3.
4.3.3.

Overview and assessment of the 2022/23 MTEF budget allocation For the 2022/23 financial year, SAQA has a total of R115,666 million.

The budget is made up of R34.501 million or 29.82% from entity revenue (Evaluation fees, Verifications, Interest, Sundry and Professional Bodies) and R81.164 million or 70.17% from DHET transfers.

The budget decreased by R4,493 million from R120,159 million in 2021/22.
The budget is projected to grow in the outer two years of the MTEF period to R124,194 million and R130,298 million in 2023/24 and 2024/25, respectively.

Notably, the DHET grant is also projected to grow to R88,143 million and R92,628 million in 2023/24 and 2024/25, respectively.
The bulk of the budget of the entity amounting 46.34% or R53,601 million is allocated to programme 1: Administration this programme, followed by programme 4: Authentication and Ratification Services at 21.08% or R24,389 and programme 3: ICT and NQF MIS at 16.37% or R18,945 million.

the allocation for spending on compensation of employees amounts to R78,792 million and goods and services is R36,873 million.

4.4.
4.4.

Quality Council for Trades and Occupations (QCTO) The Quality Council for Trades and Occupations derives its mandate from the Constitution of the Republic of South Africa, section 22 and section 29.

It further derives its legislative mandate from the National Qualifications Framework Act, 2008 (Act No.

67 of 2008 as amended) and the Skills Development Act, 1998 (Act No 97 of 1998 as amended), Higher Education Laws Amendment Act, 2010 (Act No.
26 of 2010), Public Finance Management Act, 1999 (Act No.

1 of 1999).
1 of 1999).

The mandate is further premised on key policies; namely the National Development Plan: Vision 2030, the White Paper for Post-School Education and Training, the National Skills Development Plan, the Medium-Term Strategic Framework 2019 – 2024: Priority 3: Education, Skills and Health; Ministerial Guidelines on Implementation of the NQF; Revised Strategic Plan 2020/21 to 2024/25 of the DHET; Industrial Action Plan; and the NQF Evaluation Plan.
37 144 The overall mandate of the QCTO is to develop and manage the OQSF of the NQF.

This includes the development and quality assurance of occupational qualifications (including trades) and part qualifications registered on the OQSF, with a specific focus on occupational qualifications that address the national demand.

The QCTO contributes to Priority 3: Education, Skills and Health of the Medium-Term Strategic Framework (MTSF) for 2019 to 2024.
The successful implementation of the MTSF and the NDP remains critically dependent on access to education and training of the highest quality.

The QCTO diligently pursues increasing access to occupationally directed programmes in alignment with economic areas of highest demand, with a specific focus on increasing the supply of artisan skills, which is facilitated through an emphasis on TVET college expansion.
In expanding access to PSET opportunities, the following MTSF 2019 -2014 interventions are relevant to the work of the QCTO: • The training of young artisans through the centres of specialisation at TVET colleges.

• The development of new occupational and trade qualifications to increase access to trades and occupational programmes and therefore, contributing toward the achievement of the target of 30 000 artisans by 2030.
In supporting a responsive PSET system, the QCTO will support the following interventions.

• Introduction of compulsory digital skills training, specific to programme offerings at TVET colleges and the piloting of the CET college skills programmes around community needs.

• Implementation of hubs to promote student-focused entrepreneurship development activities and the establishment.

• Percentage of NEET students taking part in CET occupational skills programmes becoming economically active.

4.4.1.
4.4.1.

Overview of the QCTO’s Revised 2020 – 2025 Strategic Plan The QCTO revised its 2020 – 2025 Strategic Plan and the Revised Plan was tabled in Parliament.

The main reason for the revision, as noted in the Strategic Plan, was to take into account all the relevant policies, legislation and other mandates for which the QCTO is responsible for and to 38 145 accurately reflect the impact, outcomes and outputs, which the QCTO will endeavour to achieve over the period 2022/23 to 2024/25.
The QCTO revised the 2020/21 – 2024/25 Strategic Imperative 2: Adopting a special focus on Technical and Vocational Education and Training (TVET) colleges and Community Education and Training (CET) colleges and replacing it with the following imperative: • “Ensuring the development and quality assurance of occupational qualifications, part qualifications and skills programmes that are responsive to the labour market and developmental state initiatives.” The QCTO included in the legislative and National imperatives, the Draft Economic Reconstruction and Recovery Plan Skills Strategy, Occupational Qualifications Sub-Framework and Ministerial Determination, 2020.
It noted that the Minister Gazetted the Occupations Qualifications Sub-Framework (OQSF) on 29 October 2021 and the OQSF provides for the following: • Parity of esteem between the OQSF, HEQSF and the General Education and Training Qualification Framework (GENFETQF); • Promotes single and coordinated NQF; • TVET colleges “Institutions of Choice”; • Promotes Systematic Articulation between TVET colleges and higher education institutions; • Higher Education institutions offering OQSF qualifications; and • CET colleges to offer skills programmes; and contribute to ERRP Skills Strategy.
Table 4: Inclusion of new Outcome Indicators and Five-Year Targets Outcome indicator Baseline Five-Year Target Outcome 1: A single, national, quality-assured Occupational Qualifications Sub-framework that promotes synergy, simplification and effectiveness 1.2.
Level of Articulation between the No baseline An evaluation report on the extent of OQSF, GENFETQA and HEQSF established as articulation of qualifications on the yet OQSF with qualifications on the other 39 146 two Sub-frameworks (GENFETQA and HEQSF) 1.4 Level of industry satisfaction with No baseline Evaluation report on the extent of the OQSF established as Industry satisfaction with the OQSF yet 1.5 Number of comparable No baseline 5 Qualifications Frameworks against established as which the OQSF is benchmarked yet Outcome 2: QCTO to ensure that the development and quality assurance of occupational qualifications, part-qualifications and skills programmes are responsive to the labour market and developmental state initiatives 2.1 Percentage of occupational No baseline 80 % of qualifications developed as qualifications, part qualifications and established as identified in the DHET Economic skills programmes developed as yet Reconstruction and Recovery Skills identified in the DHET Economic Strategy Reconstruction and Recovery Skills Strategy 2.3 Number of occupational No baseline As per agreed targets in the approved qualifications, part-qualifications and established as DHET Revised Strategic Plan and skills programmes in high demand yet Economic Reconstruction and Recovery offered by Universities Plan Skills Strategy 2.4 Number of occupational No baseline As per agreed targets in the approved qualifications, part qualifications and established as DHET Revised Strategic Plan and skills programmes in high
 demand yet Economic Reconstruction and Recovery offered by CET Colleges Plan Skills Strategy 2.5 Number of occupational No baseline As per Economic Reconstruction and qualifications, part qualifications and established as Recovery Plan Skills Strategy skills programmes in high demand yet offered by Private Skills Development Providers 2.6 Number of TVET Colleges offering No baseline As per agreed targets in the approved occupational qualifications part- established as DHET Revised Strategic Plan and qualifications and skills programmes in yet 40 147 high demand Economic Reconstruction and Recovery Plan Skills Strategy 2.7 Number of CET Colleges offering No baseline As per agreed targets in the approved occupational qualifications part- established as DHET Revised Strategic Plan and qualifications and skills programmes in yet Economic Reconstruction and Recovery high demand Plan Skills Strategy 2.8 Number of Universities offering No baseline As per agreed targets in the approved occupational qualifications part established as DHET Revised Strategic Plan and qualifications and skills programmes in yet Economic Reconstruction and Recovery high demand Plan Skills Strategy 2.9 Number of Private Skills No baseline As per agreed targets in the approved Development Providers offering established as DHET Revised Strategic Plan and occupational qualifications part yet Economic Reconstruction and Recovery qualifications and skills programmes in Plan Skills Strategy high demand
 Outcome 3: QCTO is a responsive learning organisation 3.1 The relevance and responsiveness No baseline An evaluation report that measures of the QCTO and the OQSF evaluated established as sectoral perceptions of the relevance and yet responsiveness of the QCTO and the OQSF Source: QCTO Revised Strategic Plan 2020/21 – 2024/25 4.4.2.
Focus over the MTSF period and Strategic Outcomes Over the MTSF period, the work of the QCTO will be informed by the three Outcomes as follows, • Outcome 1: A single, national, quality-assured Occupational Qualifications Sub- framework that promotes synergy, simplification and effectiveness.

The Outcome contributes to the achievement of the NDP, MTSF, WPPSET, and the mandate of the QCTO and other policy priorities; by supporting the delivery of quality education, skills and training.
It will also support equity and equality issues in education and training.

A sub-framework that promotes synergy, simplification and effectiveness will also contribute to employability, 41 148 which is a key goal of the NDP.

It will also ensure adequate and timely responsiveness to the demands of the 4IR.
• Outcome 2: QCTO to ensure that the development and quality assurance of occupational qualifications, part-qualifications and skills programmes are responsive to the labour market and developmental state initiatives.

Strategic Framework (MTSF), NSDP, WPPSET, NPPSET, DHET Revised Strategic Plan, Economic Reconstruction and Recovery Skills (ERR SS) and the mandate of the QCTO and the latest list of Occupations in High Demand.
The NSDP (principle 8) requires Quality Councils to design, develop and maintain relevant qualifications.

The NDP specifically makes reference to improving the quality of education, skills development and innovation.

• Outcome 3: QCTO is a responsive learning organisation This Outcome responds to the NDP’s intent to respond to the skills needs of all sectors and respond to the lifelong learning needs of a wide range of candidates.

It also contributes to the NDP imperative to develop partnerships.
The outcome also supports the NSDP intent to identify and increase the production of occupations in high demand.

4.4.3.

Overview and assessment of the 2022/23 performance targets The QCTO’s activities toward achieving the three Outcomes will be undertaken under the four budget programmes, namely, Administration; Occupational Qualifications Management, Assessment and Certification; Occupational Qualifications Quality Assurance and Research Analysis.
For the 2022/23 financial year, the QCTO APP has 28 planned targets.

Below is a summary of the key deliverables per programme: 4.4.3.1.

Programme 1: Administration To enable QCTO performance through Strategic leadership and reliable delivery of management support services that will ensure a responsive and learning organisation.

The programme has four targets for 2022/23.


42 149 Selected key deliverables for the 2022/23 financial year include, amongst others, to: • • • • Implement 40% of the capacity building strategy; Implement 100% MSP Annual Plan deliverables; Implement 40% of the Marketing and Communications Strategy; and Implement 40% of the Change Management Strategy.
The 2022/23 budget allocation for the programme amounts to R66,051 million, of which R29,141 million for compensation of employees, R32,910 million for goods and services and R4,0 million for capital expenditure.

Notably, the allocation for spending on capital expenditure has decreased significantly from R10,760 million in 2021/22 to R4,0 million in 2022/23.

4.4.3.2.
4.4.3.2.

Programme 2: Occupational Qualifications Management, Assessment and Certification The programme ensures that occupational qualifications, part-qualifications and skills programmes on the OQSF are available, issue certificates to qualifying learners, verifies the authenticity of issued certificates and maintains stakeholder relationship.

The programme has 10 targets for 2022/23.


Selected key deliverables for the 2022/23 financial year, amongst others: • Recommend to SAQA 50 prioritised occupational qualifications (full/part) for registration on the OQSF.
• Recommend to SAQA 200 Historically Registered Qualifications for deactivation on the OQSF; • Quality assures 90% of assessments for occupational qualifications and part-qualifications against QCTO standards within 21 working-days turnaround; • Produce Report on the Implementation of Approved Council Plan; • Quality assures 90% of Assessment Quality Partners for Assessment (or Assessment Bodies) quality assures against QCTO compliance standards; 43 150 • Quality assures 95% of certificates issued within the turnaround time (21 working days); and • Report on occupational qualifications, part-qualifications and skills programmes in high demand offered by TVET colleges, CET colleges, Universities and Private Skills Development Providers.
The 2022/23 allocation for this programme amounts to R22,805 million.

The budget decreased by R3,127 million from the adjusted appropriation of R25,932 million in 2021/22.

The QCTO notes that the budget has been significantly impacted by budget cuts implemented by the DHET due to the COVID-19 pandemic and its impact on the economy.
These budget cuts have significant long- term negative impacts as the work of the unit is critical in ensuring the development of qualifications, part-qualifications and skills programmes required by the country to promote employability, thereby contributing to the economic recovery of the country.

The limited budget will also impact the degree of quality assurance carried out by the QCTO for the external assessments.
The QCTO noted that it will have to implement more risk-based quality assurance to mitigate the constraints brought about by the limited budgets.

The Certification Unit has embarked on digitising hard copy learner records.

This project is funded by the National Skills Fund and indirectly through the main budget of QCTO.

The unit currently issues trade certificates on an e-platform.
The intention of having qualifications and skills programmes issued by QCTO to also be on an e-platform will be adversely affected by the budget cuts.

4.4.3.3.

Programme 3: Occupational Qualifications Quality Assurance The programme aims to establish and maintain quality standards for Accreditation and Assessment within the OQSF.

There are 12 planned targets for 2022/23.
Selected key deliverables for the 2022/23 financial year, • Process 90% of Skills Development Providers accreditation applications for Occupational qualifications and part-qualifications within the turnaround time (90 working days); • Process 80% of Skills Development Providers accreditation applications for historically registered Qualifications (Trades, non-Trades, NATED Report 190/191, Skills Programmes) within the turnaround time (90 working days); • Process 90% of assessment centre applications (accreditation granted or declined) within the turnaround time (30 working days); 44 151 • Quality assure 75% of accredited Skills Development Providers with implemented NATED Report190/191 (e.g.
N4 – N6) programmes against the QCTO compliance standards; and • Quality assure 40 NATED Report 190/191 instructional offering marking sessions against QCTO standards.

The programme is allocated R36,530 million, of which R24,751 million is for the compensation of employees and R11,779 million for goods and services.

Notably, the budget for goods and services increases significantly by R7,115 million from the adjusted appropriation of R4,664 million in 2021/22.
The QCTO notes that the main contribution of the goods and services budget are travelling expenses, payment and training of Subject Matter Experts (SMEs) as well as workshops.

4.4.3.4.

Programme 4: Research Analysis The programmes establishes and maintains QCTO Standards for quality assurance through research, monitoring, evaluation and analysis.

The programme has two planned targets for 2022/23.


The focus during the financial year will be on producing three Research reports and get them approved by the CEO and to publish online Research Bulletin.

The programme’s allocated budget for 2022/23 amounts to R3,867 million (R1,949 million for compensation of employees and R1,918 million for goods and services.

4.4.4.

Overview and assessment of the 2022/23 MTEF budget allocation The QCTO’s budget for 2022/23 amounts to R129,253 million.
the budget comprises R28,506 million of DHET Grant, R96,147 million SETA Grant and R4,600 million of revenue from certification and accreditation services and interest received.

The overall budget has increased by R10,223 million, mainly due to the increase in SETA Grants and the projected revenue from services rendered.

The SETA Grant is projected to experience healthy growth in the outer two years of the MTEF period to R100,954 million and R106,002 million in 2023/24 and 2024/25, respectively.
Notably, the DHET grant is not growing, when considering inflation.

The budget is projected to grow in the outer two years of the MTEF period to R134,010 million and R140,687 million in 2023/24 and 2024/25, respectively.
45 152 The bulk of the QCTO’s budget at 51.10% or R66,051 million is apportioned to the Administration programme, followed by Occupational Qualifications Quality Assurance at 28,26% or R36,530 million and Occupational Qualifications Management and Certification at 17.64% or R22,805 million.

Programme 4: Research Analysis and Quality Assurance receives the smallest allocation at 2.9% or R3,867 million.
The allocation for spending on compensation of employees amounts to R73,868 million, which constitutes 57.14% of the QCTO’s total budget.

Goods and services allocation amounts to R51,385 million or 39,75% of the total budget of the QCTO.

The allocation for spending on capital expenditure amounts to R4,0 million.

4.4.5.
4.4.5.

Key issues affecting the QCTO • The QCTO budget needs urgent review to enable the entity to fulfil its role in the PSET sector as it aims to provide an enabling skills development across all institutional types, i.e., to enable the implementation of the OQSF.

• The National Skills Fund cash injection of R2,2 billon in the TVET and CET colleges to implement Occupational Qualifications will place a greater strain on the QCTO resources to provide for adequate quality assurance.
• The Business Case of the QCTO, which was presented to the DHET in February 2017 is still not yet been approved.

Consequently, the QCTO will not be in a position to fill all the positions on its organisational structure and also revoke the quality assurance function from the Quality Assurance Partners.

5.

COMMITTEE OBSERVATIONS The Committee, having assessed the 2022/23 Annual Performance Plans (APPs) of the Departments and entities, made the following observations and key findings.

5.1.
5.1.

Department of Higher Education and Training 5.1.1.

Programme 1: Administration 46 153 a) The Committee reiterated its concerns about the delays in the filling of vacant positions in the Department within the stipulated timeframe.

The Committee also noted the difficulties experienced by the Department in filling the DDG University Education position, which has been vacant for more than a year.
The Committee welcomed the appointment of Dr Socikwa to act for a period of 12 months in the position, while the Department continues with the process of filling the position on a substantive basis.

b) The Committee welcomed the steps taken by the Department to expedite the filling of vacant positions through the creation of an online application platform where applicants would be able to upload their applications via the Departmental website and an E-link.
c) The Committee noted with concern the implications of the Departments’ inadequate human resource capacity on its service delivery mandate and its ability to achieve its planned targets.

d) The Committee welcomed the increment in the budget for the compensation of employees from R9.640 billion in 2021/2022 to R10.776 billion in the current financial year.

5.1.2.
5.1.2.

Programme 2: Planning, Policy and Strategy a) The Committee noted the significance of this programme’s oversight function over the entire PSET sector.

However, it raised concerns about the ability of the Department to execute this oversight and monitoring mandate in light of the poor governance and performance by some PSET institutions.

The Committee was also concerned that approximately R10.8 million had been set aside for subsistence and travelling (S&T) in the 2022/23 financial year.
It was noted that this allocation was insufficient given the number of PSET institutions that need to be monitored in particular those that have infrastructure development projects underway.

b) The Committee reiterated its concern regarding the scourge of gender-based violence (GBV), which has been likened to a pandemic.

The Committee welcomed the inclusion of the target to produce a report on the implementation of the Gender Equality and the GBV Policy Framework for the PSET system.
However, it noted that GBV response programmes need to be mainstreamed as part of the Department’s priority area in the PSET sector, and solely producing a report was inadequate.

c) The Committee noted the shifting of the infrastructure development functions from the core delivery programmes of the Department such as University Education and TVET to the 47 154 Planning, Policy and Strategy programme.
The shifting of infrastructure programmes to this programme was aimed at improving the planning and coordination of infrastructure projects in the PSET sector.

The Committee welcomed the transfer of support staff from the other programmes to support the Planning, Policy and Strategy Branch and the proposed development of a dedicated infrastructure development support unit.
d) The Committee expressed concern that some of the performance indicators set by the Department and other entities were found to be not useful by the AGSA pro-active assessment of the 2022/23 APPs, and adjustments had to be made to ensure the targets meet the principles of being specific, measurable, achievable, relevant and time-bound (SMART).

Notwithstanding the adjustment made to the performance indicators, the Committee welcomed the 2022/23 APPs of the Department and the entities.
e) The Committee noted the increase in the number of performance indicators/targets in the 2022/23 APP, however, concerns were raised with respect to the insufficient budget of the Department to execute its mandate meaningfully.

The Committee also noted that it was critical for the Department to make a concerted effort to have a meaningful impact on the lived realities of citizens through its targets.
f) The Committee noted the budget allocation for the external service providers or consultants to render services in areas where there is no capacity within the Department.

The Committee was of the view that building internal capacity would have positive spin-offs for the Department in the long-term, and would reduce expenditure considering the fiscal constraints.

5.1.3.
5.1.3.

Programme 3: University Education a) The Committee expressed concern about inadequate support/funding for students coming from families whose household income exceeds the NSFAS threshold of R350 000 per annum while at the same time they cannot afford the cost of higher education (missing middle).

Equally concerning is that the number has grown due to loss of jobs resulting from the impact of COVID-19 and slow economic growth.
b) The Minister has also reported that NSFAS funded students owed historic debt amounting to R5,3 billion.

This debt was owed by students who were funded on the R122 000 family income threshold and were not funded full cost of study.

The Department has not reported whether there is funding allocated in the form of a debt relief fund to cater for this debt.
48 155 c) The Committee noted the work underway by the Ministerial Task Team (MTT) appointed to develop a comprehensive and sustainable funding model for the PSET system, which will also respond to the needs of the missing middle students.

d) The Committee noted the projected marginal downward trend in the Doctoral graduates from 3 552 in 2021/22 to 3 350 in 2022/23 due to the impact of inadequate funding for bursaries for postgraduate students.
Additionally, the Committee noted the commitments by the Minister that the National Research Fund (NRF) will fund postgraduate student’s total cost of study.

However, this decision to fund the total cost of study will result in fewer students being funded.

e) The Committee also noted that the Department projected downward trends on student completions at universities from 237 882 in 2021/23 to 227 00 in 2022/23 and graduates in initial teacher education from 30 809 in 2021/22 to 29 000 in 2022/23.
f) The Committee noted with great concern that the University Education programme receives 80.89% of the Department’s total budget, excluding direct charges against the National Revenue Fund.

However, R8,8 million was allocated for goods and services in the 2022/23 financial year and this is inadequate given the oversight, monitoring and evaluation work that the programme has to conduct over institutions.
g) The Committee noted that universities received the largest portion of the Department’s budget, 65.4% of the Department’s total budget.

However, some institutions used institutional autonomy as a mechanism to evade public scrutiny on their utilisation of public funds.

h) The Committee welcomed the Minister’s call upon universities to provide support to other PSET institutions, in particular, the improvement of articulation by students coming from the TVET college sector to universities.
It was noted that some universities utilised institutional autonomy to stifle progressive directives from Government.

i) The Committee noted that the Central Applications Clearing House (CACH) has not been effective in providing prospective students with the necessary support needed to access higher education institutions.
Additionally, the marketing of the service needed significant improvement so that the uptake of the service can increase, in particular by students coming from geographically remote areas.

49 156 j) The Committee noted the impact of the devastating floods in KwaZulu-Natal and urged the Department to ensure that students affected are provided with the necessary support so that they are not left behind in terms of the academic programme.

5.1.4.
5.1.4.

Programme 4: Technical and Vocational Education and Training a) The Committee expressed concern that the TVET programme received R12.623 billion, which roughly equates to 11% of the Department’s total budget.

The budget shortfall for the TVET sector has adversely affected the meeting of the NDP and MTSF targets on headcount enrolment for the sector over the years.
Notwithstanding the critical role that the sector should play in producing occupational skills to support the economic growth, funding is not commensurate with the sector’s policy mandate.

b) The Committee noted with grave concern the report by the Minister that funding for the TVET sector has not been growing since 2013 and the impact of this on headcount enrolments that are currently below the MTSF annual target and the NDP.
The lack of adequate funding to support the TVET sector was not in line with the Government’s plan of making TVET colleges institutions of choice for young people to acquire the necessary skills needed to access the labour market.

c) The shortage of student accommodation in the TVET sector was noted as a serious concern given the need to increase enrolments in the sector.
The Committee welcomed the additional allocation for student housing at the two TVET colleges, Gert Sibande and Majuba TVET colleges over the medium term.

d) The Committee noted the report by the Department that the devastating floods in the KwaZulu-Natal Province affected only one TVET college, Esayidi, Kokstad Campus.

The Committee urged the Department to provide the necessary support to all affected students and staff to ensure that the academic programme at the college campus can resume.

5.1.5.
5.1.5.

Programme 5: Skills Development a) The Committee noted the significant role played by sector education and training authorities (SETAs) in the PSET system and called for improved governance and management of funds by these institutions to have a meaningful impact on the lives of citizens.

50 157 b) The Committee noted with concern the lack of dedicated funding to support INDLELA Trade Test Centre, which plays an important role in the development of artisans required to sustain the economy.
c) The Committee noted the importance of having suitably qualified Accounting Authority members and executives in SETAs to improve good governance and management.

5.1.6.

Programme 6: Community education and Training a) The Committee expressed a concern that the allocation for the CET programme amounts to R2.481 billion which is only 2% of the total overall budget of the Department.
It was noted that the CET sector remains critical to supporting the development of short-term skills for out-of-school young people and adults to access the labour market.

b) The over-reliance of the CET sector on basic education / schools to provide access to teaching and learning infrastructure was noted as a major concern.

It was noted that 90% of the CET core business / activities took place in schools due to the lack of dedicated infrastructure for the CET sector.
c) The Committee noted with concern the impact of the devastating floods in KwaZulu-Natal Province, which had affected more than 600 schools.

Consequently, the CET students who are accommodated in these schools are impacted.

The Committee urged the Department to provide the necessary support to the affected students so that they are not left behind in terms of the academic programme.
d) The Committee expressed concern regarding the target to increase CET enrolments from 142 585 in 2021/22 to 266 424 in 2022/23.

It was noted that the CET sector did not have the necessary capacity to accommodate this significant increase given its limited resources.

e) The Committee commended the Department for convening the Ministerial CET Summit, which took place on 8-9 March 2022.

It was noted that the resolutions of this Summit ought to have a positive impact on the growth of the CET sector.
5.1.7.

Budget a) The Committee welcomed the 7% increment in the Department’s budget for 2022/23, especially additional allocation to student funding in the MTEF period as well as R900 million allocation for infrastructure for student accommodation.

51 158 b) The Committee further welcomed the reprioritisation of R200 million within the Department’s baseline funding toward assisting PSET institutions in KwaZulu-Natal Province to deal with the impact of the floods.
c) The Committee noted with concern the decrease in the nominal growth in the budget, in the outer two years of the MTEF period.
d) Notwithstanding that, the Committee welcomed the increase in the allocation for student funding over the medium term to fund the fee-free education policy and to ensure stability in higher education and TVET sectors; the Committee reiterated its 2021 concern about the exponential growth in student funding that is not commensurate to the growth in universities subsidies and the impact this will have in the medium to long term on the ability of the institutions to deliver quality education to students.
e) The Committee noted with grave concern that the Department has many unfunded mandates, which were not funded from the voted funds, but through other sources such as the National Skills Fund, savings within the Departmental programmes and donor funding.

The Committee noted the concern by the Department that some donor funding was coming to an end and this could impact on the sustainability of the funded programmes.

5.2.
5.2.

National Student Financial Aid Scheme a) The Committee noted with concern the delays in the adjustment of the entity’s indicators as highlighted by the AGSA.

The AGSA had undertaken a pro-active assessment of the usefulness of the entity’s performance indicators/targets in the 2022/23 APP, and some of them were not aligned with the SMART principles.

Consequently, the entity will need to make the necessary adjustments and submit an amended 2022/23 APP to Parliament.
b) The Committee welcomed the increase in the budget for student funding from R41.985 billion in 2021/22 to R48.968 billion in 2022/23.

However, it was concerned about the 19.9% reduction in the administrative budget from R382.5 million in 2021/22 to R306.2 million in 2022/23, and its impact on the planned systems and processes improvements.
The growth in the amount of student funding budget signifies growth in the number of beneficiaries and related controls that need to be put in place to ensure that the funds are properly disbursed.

However, the administration budget amounted to 0.81% of the total student funding budget in 2022/23, and this remains a serious concern.
Other similar PSET 52 159 institutions utilise 10% of their total budget for administration, and the administration threshold of the NSFAS will need to be increased in the medium-term.

c) The Committee noted the progress made by the entity in the handling of the 2022 funding applications.
There have been notable improvements made in the NSFAS portal, which is able to provide real-time eligibility decisions to the eligible first-time entry (FTEN) applicants, including South African Social Security Agency (SASSA) grants beneficiaries.

d) The Committee noted with concern that a high number of students in the potential exceptions were students from the University of the Free State.

e) The Committee expressed concern about the delays in the turn-around time in resolving student queries.
It was noted that some members of the Committee who tried to assist students had also experienced the delays.

f) The Committee noted with concern the existing systemic challenges in the legacy information and communication technology (ICT) systems of the entity, including the delays in the procurement of an ICT system that is fit for purpose.

g) The Committee expressed concern about the nine TVET colleges that were not complying with the submission of data needed for the close-out project.
h) The Committee noted with concern the increasing demand for fee-free higher education compared to the available funding to meet the demand in the medium term period.

Equally concerning was the low recovery rate of loans owed by former beneficiaries pre-2018.

i) The Committee noted the Board’s initiative of engaging stakeholders in the PSET institutions, in particular those, which experienced NSFAS related challenges.
However, it expressed concern about the NSFAS communication strategy, which was more reactive than proactive.

j) The Committee noted the progress made in the finalisation of the close-out project, which is expected to be finalised in June 2022.

The Committee stressed the importance of improving data exchange between NSFAS and institutions for reconciliation of records.

5.3.
5.3.

Council on Higher Education a) The Committee expressed concern about the allegations that Walter Sisulu University (WSU) awarded degrees that were not accredited, and the impact of this on the students.

The Committee noted the response by the CHE that the media sensationalised the matter 53 160 and that all but five programmes were accredited.

The CHE was working with the University to address the five legacy qualifications and the entity will conduct an institutional audit of the University.
b) The Committee accepted the 2022/23 APP of the entity notwithstanding the limited budget available for it to fully execute its mandate.

c) The Committee welcomed the digitisation of the systems and processes of the entity.

5.4.
5.4.

South African Qualifications Authority a) The Committee commended the SAQA Board and the Executive management for steering the entity well during the difficult past two years of the COVID-19 pandemic, which adversely affected its income-generating services and resulted in the retrenchments of 89 staff members in 2021. b) The Committee welcomed the commitment from the entity that priority was being given to its former employees in the filling of any available vacancies and short-term contract jobs.
c) The Committee welcomed the report that the entity was financially sustainable in the short term and hoped that the automation and digitisation projects would be fast tracked to ensure medium to long-term sustainability and to avoid reputational risks d) The Committee welcomed the additional allocation (R20 million) to the entity for digitisation and automation of processes and systems.
The Committee also welcomed the commitment from the entity that its savings would be redirected for the implementation of the automation project.

e) The Committee expressed grave concern about the delays in the proclamation of the NQF Amendment Act, 2019.

Equally concerning to the Committee was that the Department’s plans present the NQF Amendment Bill to Parliament for processing, while there is an outstanding proclamation of the 2019 NQF Amendment Act.
f) The Committee was concerned that some of the entity’s 2022/23 APP targets were set based on the hope that the President will proclaim the NQF Amendment Act; and, that those targets will not be achieved in the event the President does not proclaim the Act.

5.5.

Quality Council for Trades and Occupations 54 161 a) The Committee welcomed the 2022/23 APP of the entity notwithstanding its insufficient budget to fully execute its mandate.
b) The Committee expressed concerns about the delays in the approval of the business case of the entity, which would enable it to be fully functional and take over the Education and Training Quality Assurance (ETQA) function, co-shared with the SETAs.

c) The Committee was concerned that the entity’s approved organisational structure provides for 246 permanent posts to be filled in phases based on the availability of funds.
However, the entity had a total number of 94 permanent staff members, and the limited human resource capacity impacts its ability to fulfil its role in the PSET sector through the implementation of the Occupational Qualifications Sub-Framework (OQSF).

d) The delays in the appointment of the Council Chairperson and the filling of other vacant Council positions by the Minister were noted as a concern.

The Committee noted that it has been over a year that the vacant Council positions have not been filled.
These delays have the potential to limit the Council’s ability to exercise its oversight role over the affairs of the entity.

e) The QCTO since its establishment has been leasing its premises, and the delays in the purchasing of its own premises have been repeatedly stressed as a concern by the Committee.

6.

RECOMMENDATIONS The Committee, having assessed the 2022/23 APP of the Department and entities, recommends that the Minister of Higher Education, Science and Innovation considers the following: 6.1.
DEPARTMENT OF HIGHER EDUCATION AND TRAINING 6.1.1.

Programme 1: Administration a) The Department expedites the filling of vacant positions within the stipulated timeframe, including the DDG University Education.

The filling of vacant positions will assist the Department in meeting its service delivery requirements and related performance indicators and targets.
b) The Department expedites the procurement of the E-recruitment system, which is aimed at reducing the turn-around time for filling vacant positions.

55 162 6.1.2.

Programme 2: Planning, Policy and Strategy a) The Department expedites the establishment of the infrastructure development support unit in this Branch.
Additionally, the Department capacitates the Branch to execute its oversight and monitoring over the implementation of infrastructure development projects by institutions to ensure that they are completed within the allocated budget and specific timeframes.

b) The Department considers adding more specific and actionable targets in the implementation of the Gender Equality and the GBV Policy Framework for the PSET system.
Mainstreaming of the Department’s response to GBV will contribute significantly to the fight against the scourge in the PSET sector, this would require the requisite funding in line with advancing gender responsive budgeting.

c) The allocated budget of R10.8 million for travelling and subsistence in 2022/23 will need to be increased given that the Planning Branch has a critical oversight function over the PSET system.
d) The Department considers building internal capacity within the Planning, Policy and Strategy Branch to minimise the utilisation of consultants, which is estimated to cost R4 million for the 2022/23 financial year.

e) The Department, working with entities should improve on the development of their performance indicators and targets of the APPs in line with the SMART principles.

6.1.3.
6.1.3.

Programme 3: University Education a) The Department expedites the development of a sustainable student funding model of the PSET system so that students from the missing middle bracket are assisted with funding to access higher education institutions.

b) The Department improves the marketing and roll-out of the CACH so that it can have a meaningful impact in expanding access to higher education institutions.
c) Higher education institutions in KwaZulu-Natal put mechanisms in place to support students coming from areas affected by the devastating floods so that they are not left behind in terms of the academic programme.

d) The University Education Branch ensures that universities adhere to the reporting requirements in terms of the utilisation of public funds allocated to them.
The notion of 56 163 institutional autonomy should not be used at the expense of public accountability, given that universities receive 65.4% of the Department’s budget.

e) The Department ensures that universities put the necessary mechanisms in place to support the training and development of TVET and CET lectures and students, and other areas of common interest.

f) The Department ensures that the University sector plays a greater role in supporting other programmes in the PSET sector.

6.1.4.
6.1.4.

Programme 4: Technical and Vocational Education and Training a) The TVET sector needs additional funding to increase enrolment in line with the MTSF targets and to achieve the 2030 NDP target of 1 million students in the TVET sector.

b) TVET colleges in KZN mechanisms put in place mechanisms to support students coming from areas affected by the devastating floods so they are not left behind in terms of the academic programme.
c) The development and expansion of student accommodation infrastructure in the TVET sector be prioritised, and capacity-building initiatives are implemented to assist the management of TVET colleges with the necessary skills required to utilise the Infrastructure Efficiency Grants (IEG) earmarked for infrastructure expansion and maintenance.
d) The Department expedites the improvement of student’ placement into workplace or industry to acquire the necessary work-based learning to complete their qualifications.

Equally, the industry needs to absorb more students to participate in work-integrated learning programmes to obtain the necessary experience required to complete their qualifications.

6.1.5.
6.1.5.

Programme 5: Skills Development a) Dedicated funding be considered to assist INDLELA Trade Test Centre to operate efficiently and effectively in the training and development of artisans required to build and sustain the economy.

b) The proper coordination of the skills development interventions by SETAs be prioritised to improve their uptake and impact on the lives of citizens.
57 164 c) Work be done to encourage industry to assist in the absorption of students for work- integrated learning and post-qualification.

6.1.6.

Programme 6: Community Education and Training a) The Department works towards the realisation of closer working relationships and collaboration between CET colleges and other relevant PSET institutions, including the private sector.
b) Additional funding and resources are needed to increase enrolment and capacity of CET colleges to contribute to the mass skills provision and alleviation of poverty and youth unemployment in the country.

c) The Department ensures that the resolutions coming out of the Ministerial CET Summit are implemented to position CET colleges as institutions of choice for the provision of skills programmes.
d) The Department ensures that the students affected by the devastating floods in KZN are provided with the necessary support to catch up on the academic programme.

6.2.

National Student Financial Aid Scheme a) The entity expedites the adjustment of the performance indicators that were not aligned to the SMART principles as highlighted by the AG in the APP 2022/23.

b) The entity improves its communication strategy so it can be accessible to all the relevant stakeholders and students in the PSET sector.
Students need to be kept up to date regarding the processes of the entity.

c) NSFAS expedites the finalisation of students’ appeal process to ensure that no student is left behind in terms of the academic programme.

d) The entity expedites the payment of tuition and residence fees to institutions so that institutions and private accommodation providers can cater for the needs of students in student residences.
e) NSFAS, working in collaboration with the Department, ensures that the nine TVET colleges that have not submitted data for the close-out project do submit and consequence management is implemented against these colleges.

58 165 f) NSFAS improves its turnaround time in response to the student-related queries.

g) NSFAS prioritises the procurement of an ICT system that is fit for purpose to improve the operations and systems of the entity.
h) The entity solicits additional funding to increase its administration budget which is not sufficient to support Student-centred Model for effective and efficient disbursement of funding to institutions and students.

i) A review of the centralisation of the NSFAS be undertaken, considering the inadequate accessibility of the entity in all institutions of higher education and training.
NSFAS should investigate avenues to maximise accessibility at various institutions, and this could include the establishment of district/regional offices closer to PSET institutions.

6.3.

Council on Higher Education a) The entity, working with WSU, ensures that all students who have been negatively affected by the allegations in relation to offering of unaccredited qualifications by University are provided with the necessary support.
b) Institutional audits be undertaken at universities to assess their capacity in the management of their academic activities.

c) The Communication and Advocacy Plan of the entity be translated into indigenous languages to ensure access of information to all the citizens of the country.

6.4.

South African Qualifications Authority a) The entity expedites the implementation of the automation and digitisation projects aimed at ensuring the organisation works smart and efficiently.
b) SAQA, working in collaboration with the Office of the Minister, liaises with the Office of the President on the outstanding proclamation of the NQF Amendment Act, 2019. c) SAQA expedites collaborations with other PSET institutions to improve articulation pathways within and across sub-frameworks.

d) The Department ensures that additional funding is allocated to improve the financial sustainability of the entity over the medium term to long-term.

6.5.
6.5.

Quality Council for Trades and Occupations 59 166 a) The Minister expedites the consideration and approval of the documentation submitted to his Office by the QCTO for the purchase of its own premises.

b) The Minister expedites the filling of the vacant position of the Board Chairperson and other vacancies in the QCTO Council.
c) The QCTO needs to be adequately funded and capacitated as the quality assurance demand is expected to increase due to the uptake of the occupational programmes by TVET and CET colleges.

d) QCTO expedites the automation project to improve its efficiency.

Report to be considered 60 167