Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1698140142713.pdf (South Africa)
Wednesday, 2 June 2021] No 74—2021] THIRD SESSION, SIXTH PARLIAMENT PARLIAMENT OF THE REPUBLIC OF SOUTH AFRICA _____________________ ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS _____________________ WEDNESDAY, 2 JUNE 2021 _____________________ TABLE OF CONTENTS ANNOUNCEMENTS National Assembly 1.

Membership of Committees ............................................................................................. 2 National Council of Provinces 1.
Referral to Committees of papers tabled .......................................................................... 2 COMMITTEE REPORTS National Assembly 1.

2.

3.

4.
Agriculture, Land Reform and Rural Development ......................................................... 4 Home Affairs .................................................................................................................... 9 Communications ............................................................................................................. 11 Communications ............................................................................................................. 45 1 National Council of Provinces 1.
2.

3.

4.
Trade and Industry, Economic Development, Small Business Development, Tourism, Employment and Labour ......................................................... 47 Trade and Industry, Economic Development, Small Business Development, Tourism, Employment and Labour ......................................................... 63 Transport, Public Service and Administration, Public Works and Infrastructure ............................................................................................................ 82 Transport, Public Service and Administration, Public Works and Infrastructure .......................................................................................................... 101 Security and Justice ...................................................................................................... 111 Security and Justice ...................................................................................................... 126 Security and Justice ...................................................................................................... 143 Security and Justice ...................................................................................................... 163 Security and Justice ...................................................................................................... 164 5.
6.

7.

8.

9.

10.

Cooperative Governance and Traditional Affairs, Water and Sanitation and Human Settlements ............................................................................... 165 11.

Education and Technology, Sport, Arts and Culture .................................................... 173 12.

Education and Technology, Sport, Arts and Culture .................................................... 225 13.
Education and Technology, Sport, Arts and Culture .................................................... 251 ANNOUNCEMENTS National Assembly The Speaker 1.

Membership of Committees (1) The following committee membership changes have been made by the African National Congress: Portfolio Committee on Environment, Forestry and Fisheries Discharged: Tongwane, Ms TMA (deceased) Discharged: Appointed: Capa, Mr N (Alternate) Capa, Mr N National Council of Provinces The Chairperson 1.
Referral to Committees of papers tabled (1) The following paper is referred to the Select Committee on Appropriations for consideration and report: 2 (a) Submission of the Financial and Fiscal Commission on the Division of Revenue Bill for 2022-23, tabled in terms of section 9(1) of the Intergovernmental Fiscal Relations Act, 1997 (Act No 97 of 1997), as amended.
COMMITTEE REPORTS National Assembly 3 [The following report replaces the Report of the Portfolio Committee on Agriculture, Land Reform and Rural Development, which was published on page 117 of the Announcements, Tablings and Committee Reports dated 25 May 2021] 1.

Report of the Portfolio Committee on Agriculture, Land Reform and Rural Development on the Liquor Products Amendment Bill [B10B – 2016] (National Assembly – Section 75), dated 02 June 2021.
The Portfolio Committee on Agriculture, Land Reform and Rural Development (the Committee) having considered the President’s reservations on the subject matter of the Liquor Products Amendment Bill [B10B – 2016] referred to it by the National Assembly (see ATC, dated 12 June 2020) and reclassified by the Joint Tagging Mechanism (JTM) as a Section 75 Bill (see ATC, dated 25 February 2021) which pertains to customs, reports on the Bill as follows: 1.
Contextual background The then Minister of Agriculture, Forestry and Fisheries introduced the Liquor Products Amendment Bill [B10 – 2016].

This Bill was introduced in Parliament in 2016 to address deficiencies that have been identified by the former Department of Agriculture, Forestry and Fisheries (DAFF) in the Principal Act, the Liquor Products Act, 1989 (Act No.

60 of 1989) as amended by the Liquor Products Amendment Act, 2008 (Act No.

32 of 2008).
32 of 2008).

The objectives in light of the Principal Act (Act No.

60 of 1989) that is being amended by the Bill are: • To provide for control over the sale and production for sale of certain alcoholic products, the composition and properties of such products and the use of certain particulars in connection with the sale of such products; • For the establishment of schemes; • For control over the import and export of certain alcoholic products; and • For matters connected therewith.

1 4 2.
1 4 2.

The Objectives of the Liquor Products Amendment Bill The Bill seeks to: • Amend the Liquor Products Act, 1989 (Act No.
60 of 1989), so as to insert certain definitions and to amend and delete others; • Provide for the renaming and reconstitution of the Wine and Spirit Board and to limit its powers; • Provide for requirements regarding beer, traditional African beer and other fermented beverages; • Repeal a provision in respect of the authorisations regarding certain alcoholic products; • Empower the Minister to designate a person to issue export certificates; • Align certain provisions with the Constitution; • Extend the Minister’s power to make regulations; • Provide gender-sensitive terminology; and • Provide for matters connected therewith.
The amended Liquor Products Amendment Bill [B10B-2016] was passed by the National Assembly on 26 June 2018 with the approval of the National Council of Provinces; and subsequently referred to the President for assent (see ATC, 26 June 2018).

3.
3.

The President’s Reservations on the Liquor Products Amendment Bill The Liquor Products Amendment Bill [B10B-2016] (the Bill) as amended was referred back to the Portfolio Committee on Agriculture, Land Reform and Rural Development (the Committee) for consideration and report in terms of Joint Rule 203 due to reservations of the President as outlined in the ATC dated 12 June 2020 (see ATC, 12 June 2020).
Since the Bill includes the regulation of traditional African beer in its provisions, the President was of the opinion that the Bill will affect customary practices with regard to the production, distribution and consumption of traditional African beer.
Therefore, in line with Section 79 of the Constitution, he had reservations on its constitutionality as it was not referred to the National House of Traditional Leaders in terms of Section 18(1)(a) of the Traditional Leadership and Governance Framework Act, 2003 (Act No.

41 of 2003).
41 of 2003).

The President was of 2 5 the view that the Bill should have been referred to the National House of Traditional Leaders (NHTL) in terms of Section 18(1)(a) of the Traditional Leadership and Governance Framework Act, 2003 (Act No.

41 of 2003).
41 of 2003).

On 03 November 2020, the Portfolio Committee on Agriculture, Land Reform and Rural Development (the Committee) considered the President’s reservations and after listening to the advice and guidance provided by the Parliamentary Legal Advisor, Committee Content Advisor and Departmental Officials that are responsible for the Bill, deliberated and agreed with the President’s opinion.
The Committee further resolved that – (1) The Joint Tagging Mechanism (JTM) must consider relooking at the tagging of the Bill in terms of Joint Rule 163(3); and (2) The Secretary to Parliament should accordingly refer the Liquor Products Amendment Bill to the NHTL in terms of Section 18(1)(a) of the Traditional Leadership and Governance Framework Act, 2003 (Act No.

41 of 2003).

4.
41 of 2003).

4.

Referral to the National House of Traditional Leaders (NHTL) On 25 February 2021, the Bill was reclassified by the JTM in terms of Joint Rule 163 (3), as a Section 75 Bill pertaining to customary law or customs of traditional communities (see ATC, 25 February 2021).

Subsequently the remitted Liquor Products Amendment Bill (remitted Bill) was referred to the NHTL in accordance with Section 18 (1) of the Traditional Leadership and Governance Framework Act, 2003 (Act No.
41 of 2003) (TLGFA) on 26 February 2021 (see ATC, 26 February 2021).

In response to the s 18 of the TLGFA referral and the remitted Bill, the NHTL submitted that the traditional African beer should not be regulated in terms of the Liquor Products Amendment Bill as it will create confusion in traditional communities.
It further submitted that traditional communities use different ingredients in preparing their own traditional beer and for this reason, traditional African beer should be excluded from the Bill.

5.
5.

Committee decision 5.1 The Committee reports to the National Assembly that the procedural defect on which the President expressed a reservation, has been corrected by way of obtaining inputs on the 3 6 remitted Bill [B10B - 2016] and referred it to the National House of Traditional Leaders (NHTL) in terms of Section 18(1)(a) of the Traditional Leadership and Governance Framework Act, 2003 (Act No.

41 of 2003).
41 of 2003).

5.2 The Committee considered the submission from the NHTL and further received responses to the inputs from the Parliamentary Legal Advisor; and the Department of Agriculture, Land Reform and Rural Development, headed by the sponsor of the Bill, the Minister of Agriculture, Land Reform and Rural Development who now takes responsibility for the introduced Bill and administers related legislation.
5.3 The Committee was advised by the Parliamentary Legal Advisor and also took note of the Department’s inputs.
Thereafter, the Committee concluded that the concerns raised by the NHTL are sufficiently catered for in the Bill, especially as the principal Act being amended, makes it plainly clear that it regulates liquor products that are produced for sale wherein, if the amendment is passed, will include the traditional African beer produced for sale or commercial purposes, excluding that which is made for personal drinking purposes and cultural use.
5.4 Where liquor products including traditional African beer, are sold or produced for commercial purposes; the Committee further recognises the importance of regulation in safeguarding human health and safety; and also to control and prevent the proliferation of the production for sale, of illegal liquor products.

6.
6.

Committee recommendations The Committee makes the following recommendations to the National Assembly: 6.1 The Committee identified a referencing error on clause 1(l) of the remitted Bill ([B10B - 2016] where the definition of traditional African beer was referenced as a product that meets the requirements referred to in section 6C of the Bill.

The correct reference should be section 6B as section 6C refers to requirements for other fermented beverage.
In this regard, as the amendment has no impact on the subject of the remitted Bill, the Committee 4 7 recommends that the editorial error be corrected by replacing 6C with 6B on clause 1(l) of the remitted Bill before assent by the President.

6.2 With the correction of the referencing error as mentioned on 6.1 above, the Committee recommends the approval of the remitted Bill in its current form in terms of Joint Rule 203(3)(a) and Joint Rule 205.

Report to be considered.

5 8 2.


Report of the Portfolio Committee on Home Affairs on the draft notice determining the remuneration of Commissioners of the Electoral Commission of South Africa (IEC) for 2020/21, dated 01 June 2021.

The Portfolio Committee on Home Affairs, having considered the draft notice of the President’s determination of the salaries and allowances of members of various institutions, including Commissioners of the Electoral Commission of South Africa (IEC), reports as follows: 1.
A letter, dated 13 April 2021, was received from the President of the Republic, requesting the National Assembly to consider the draft notice of determination of the salaries and allowances of members of various institutions, including the Commissioners of the Electoral Commission (IEC) in terms of the Determination of Remuneration of Office-Bearers of Independent Constitutional Institutions Laws Amendment Act, 2014 (Act No.

22 of 2014) for 2020/21 , usually required by the end of the financial year.

2.
2.

On 22 April 2021, the matter was referred to the Committee for consideration and report.

3.

Section 219(5) of the Constitution of the Republic of South Africa, 1996, provides that national legislation must establish frameworks for determining the salaries, allowances and benefits of judges, the Public Protector, the Auditor-General, and members of any commission provided for in the Constitution, including the Electoral Commission referred to in section 192 of the Constitution.

4.
4.

The Determination of Remuneration of Office-Bearers of Independent Constitutional Institutions Laws Amendment Act, 2014 (Act No.

22 of 2014), which came into operation on 1 April 2019, creates the necessary framework to determine the salaries of office-bearers of Chapter 9 institutions mentioned in the Constitution.

5.
5.

Section 7 (2) of the Electoral Act 73 of 1998 provides that the conditions of service, remuneration, allowances and other benefits of Commissioners shall from time to time be determined by the President after consultation with the Commission on Remuneration of Representatives established by section 2 of the Commission on the Remuneration of Representatives Act, 1994 (Act 37 of 1994), and a distinction may be made between commissioners appointed in a full-time and part-time capacity.

9 6.
9 6.

The President received the annual salary recommendations for the Public Office-Bearers of the Independent Constitutional Institutions from the Independent Commission for the Remuneration of Public Office Bearers.

7.

The Commission having considered, amongst others, the State's wage bill and the impact of Public Office Bearers' salary increment on the fiscus of the country negatively affected by Covid-19; recommended 0% salary increment for all public office bearers for the financial year 2020/21.
8.

The one part-time IEC Commissioner is a Judge and as such is remunerated in terms of section 2(4) of the Judges’ Remuneration and Conditions of Employment Act 2001, (Act No 47 of 2001).
The Portfolio Committee on Justice and Correctional Services, having considered Draft Notice determining the rate at which salaries, allowances and benefits are payable to Constitutional Court judges and other judges annually with effect from 1 April 2021, tabled for approval the Draft Notice to also allocate no salary increase for 2020/21.

Recommendation.
Recommendation.

The Committee, having deliberated, concur with the President’s determination on the remuneration adjustment of IEC Commissioners, that a retrospective salary freeze or 0% increase be implemented for the Chairperson and other full-time Commissioners given their salary level for the 2020/21 financial year.

For the part-time Commissioner, a similar freeze will thus apply to the daily/hourly rate which they received for 2020/21 over and above the salary freeze applicable to Judges.
The Committee recommends that the National Assembly approve the draft notice determining the remuneration of the Commissioners of the Electoral Commission of South Africa (IEC).

Report to be considered.

2 10 3.
Report of the Portfolio Committee on Communications on the 2019/20 Annual Reports and Financial Statements of the South African Broadcasting Corporation (SABC), the South African Post Office (SAPO), the Universal Access Agency of South Africa (USAASA) and the Universal Service Access Fund (USAF), dated 14 May 2021 The Portfolio Committee on Communications (the Committee), having considered the 2019/20 Annual Reports and Financial Statement of the above-mentioned entities of the Department of Communications and Digital Technologies (DCDT), reports as follows 1.
Introduction According to Section 5 of the Money Bills Amendment Procedure and Related Matters Act, the National Assembly, through its Committees, must annually assess the performance of each national Department.

The Committee must submit an annual BRRR for the Department as it falls under its oversight responsibilities, for tabling in the National Assembly (NA).
This process happens every October of each year where the Committee assesses service delivery performance given available resources; evaluate the effective and efficient use and forward allocation of resources; and may make recommendations on the forward use of resources.
For the Committee it considered the performance and submission to National Treasury for the medium term period of the two Departments reporting to it, namely the Department of Communications and the Department of Telecommunications and Postal Services.
Furthermore, the Committee is mandated to assess all the entities reporting to the departments and as such, the following entities’ financial performance for the year under review was scrutinised: (i) Film and Publications Board (FPB); (ii) the Independent Communications Authority of South Africa (ICASA); (iii) Sentech; (iv) State Information Technology Agency (SITA); (v) Broadband Infraco; (vi) National Electronic Media of South Africa (NEMISA); and (vii).ZADNA, on 4, 6, 17 and 18 November 2020.
The SABC, USAASA/USAF and SAPO tabled their reports only after the BRRR process was concluded.

The Committee met with the SABC on 23 February 2021, USAASA/USAF on 9 March 2021 and SAPO on 12 May 2021.

1.1 Organisational Environment 1 11 In November 2018, President Cyril Ramaphosa pronounced a merger between the ministries of Communications and of Telecommunications and Postal Services into a single Ministry of Communications and Digital Technologies (DCDT) under new Minister Stella Ndabeni- Abrahams.
This, as he indicated in his 2018 SoNA, is ‘to initiate better alignment and coordination on matters that are critical to the future of our economy in the 4IR context.’ He further pronounced that the departments would remain as separate departments until the end of the fifth administration.
For this reason, during the reporting period, both Departments worked closely together on identified projects as well as undertook resource sharing from both a financial and human resource perspective in the spirit of the pending merger of the Departments in line with the National Macro Organisation of Government (NMOG) objectives.

The DCDT strategy as well as the start-up structure for the DCDT was jointly developed and approved by the DPSA.
The transfer of employees from the DCDT and the DOC to the newly established DCDT was also concluded.

As of 01 April 2020, the DTPS and the DoC merged to form the DTPS.

In his 2019 SoNA, the President appointed a 30-member Presidential Commission on the 4th Industrial Revolution (PC4IR) in order to ensure that South Africa effectively harnesses technological change in pursuit of inclusive growth and social development.
The Commission is envisaged to serve as a national overarching advisory mechanism on digital transformation and was established and administered through the Department.

The 2019/20 financial year was also the last year for the implementation of the Department’s strategic goals and strategic objectives as committed to in the 2015-2020 Strategic Plan.
As mentioned above, the DTPS has been in a state of transformation for the majority of the reporting period which in essence required the Department to collaborate with the Department of Communications in terms of jointly undertaking specific projects.

The sharing of such resources was formalised through the development of a Cooperation Agreement which was signed by the relevant principals of both Departments.
Furthermore, during the reporting period, all staff members from the DOC physically relocated to the premises of the DTPS where they were accommodated.

During the reporting period, the Departments also worked together on developing the DCDT Strategy as well as a start-up structure that accommodated staff from both Departments as an interim measure while the revised organisational structure, aligned to the new DCDT mandate, 2 12 will be developed in the 2020/21 financial year.
This transformational journey required extensive internal communications and change management due to the disruption that was caused to both Departments.

This report is the summary of reporting of the SABC, USAASA/USAF and SAPO who tabled after the BRRR process was concluded by the Committee as indicated above.

2.

SABC Annual Report and Financial Statements The SABC is listed as a Schedule 2 public entity in terms of the Public Finance Management Act (PFMA) of 1999.
Its mandate is set out in its charter and in the Broadcasting Act of 1999, as amended, and requires it to provide radio and television broadcasting services to South Africa.

The nature of operations includes radio broadcasting; television broadcasting; implementation of digital terrestrial migration and technology; programming and development of local content; expansion of commercial radio stations to increase the organisation’s audience share; and digitisation of value chain and distribution platforms.
The SABC is one of the key institutional pillars of our democracy, delivering essential content to millions of South Africans on multiple platforms and in 14 different languages, on a daily basis and remains one of South Africa’s biggest national treasures.

SABC TV consists of three free-to-air (FTA) channels and two other channels carried on a subscription digital satellite network.

The channels deliver top-quality local and international content in all South Africa’s languages through-out the nation.
SABC1, SABC2 and SABC3 attract on average 27.9 million South African viewers in a typical month.

The mandate of the SABC, as a Public Broadcaster, is embedded in a range of statutes, regulations, policies, codes of conduct and licence conditions.
In addition to its legislative and regulatory obligations, the SABC Board is responsible for the control and direction of the affairs of the Corporation as set out in the SABC’s Memorandum of Incorporation (MoI), as approved by the Shareholder, represented by the Minister of Communications.

The relationship between the SABC, its Board and the Shareholder is governed by a Shareholder Compact, reviewed and renewed on an annual basis.
The MoI and the Shareholder Compact ensure that the Corporation complies with the essential pillars of a governance framework, which includes the Broadcasting Act, the Companies Act, the PFMA and the Constitution.

3 13 As the only Public Service Broadcaster, the SABC must offer a range of informative, educational and entertainment programmes that display South African attitudes, opinions, ideas, values, talent and artistic creativity.
2.1 Performance Information The SABC managed to achieve 59 percent of the set targets during the year under review.
The graph below is a simplified illustration of the SABC’s performance against the 2019/20 Corporate Plan Predetermined objectives (PDOs): Like the entire country challenged by the global COVID-19 pandemic, for the year under review, the SABC expedited the launch of a dedicated Educational Channel on multiple platforms but also interrupted scheduled free-to-air programming to bring #WozaAfrica to millions of Matric households.
The public broadcaster cemented its place in our democracy during a time of national crisis.

The 2019/20 financial year began in very uncertain conditions.

A combination of unfilled vacancies and five resignations in the previous fiscal had left the board inquorate with only four non-executive directors remaining.
During significant periods of the year under review, the SABC contended with operating without permanent employees in key positions, including the Chief Operations Officer, Media 4 14 Technology Infrastructure, Television and Commercial Enterprises Group Executives, as well the Head of Supply Chain Management.

As a result of not having permanent employees in such key roles, performance suffered as implementation momentum could not be sustained.
The SABC also faced the challenge of covering the national elections in May 2019 without the Board being able to take decisions as the accounting authority.

The first half of the year under review saw the SABC’s leadership team devote vast amounts of time and effort to developing the Turnaround Plan, which supported the organisation’s request for government funding.
Crafted jointly with GTAC and DCDT, the plan was successful, with the first tranche of the bailout being received in the third quarter, while the balance was paid out during the last month of the financial year.

The SABC met all of Government’s Preconditions for the recapitalisation of the organisation and received a R3.2 billion bailout in two tranches – R2.1 billion in October 2019 and R1.1 billion in March 2020.
The receipt of the bailout enabled the activation of content acquisition and capital expenditure investment plans that are aimed at putting the SABC on a firmer financial position in the medium to long term.

In addition, for restoration of stability to the institution, in April 2019, the constitution of the SABC Board was refresh with the addition of eight new non-executive members.
During the period under review, which also saw the election of the country’s sixth administration, the public broadcaster continued to offer comprehensive compelling coverage reflecting a variety of views and analyses, while providing entertainment that displayed South Africa’s diverse cultural heritage.

SABC News was widely-praised for delivering highly balanced radio, television and digital coverage of the national elections in May 2019.
The positive endorsement of the SABC’s coverage of the 2019 National Elections by the watchdog, Media Monitoring Africa, provided the added reassurance that the organisation is on the right path.

The year also saw the continued rise in the emergence of SABC News as the premier source of incisive journalism in the country and on the continent.
The public news service’s ethos ‘Independent and Impartial,’ continues to be its moral and ethical compass in the ongoing efforts to affirm it as the number one news source in the country.

By the end of the year under review, the SABC News Channel led the 24-hour television news market in the country with an improved market share performance of 42 percent and 40 percent 5 15 in the free-to-air and pay-tv news markets, respectively.
Further proof that audiences want credible news they can trust from a broadcaster they can believe in.

The SABC News Online is also the 2nd most accessed online news source in the country Despite years of editorial interference at the SABC as reported by Independent Thloloe Commission in August 2019, management has gone a long way to rebuilding public and employee trust.

All SABC platforms exceeded the local content targets.
The SABC Board has further approved an Over-the-Top (OTT) streaming strategy with the short-term goal that the SABC will leverage online and mobile platforms to allow customers to access ALL SABC content and services anywhere, anytime and on any device.

The efforts to strengthen governance restore SABC’s accountability, and rebuild public trust and confidence in the SABC were enhanced, as well as initiatives to stabilise leadership and turnaround the dire state of the Corporation’s finances.
In terms of listenership, SABC radio recorded a combined weekly average of 37.5 million adults who tuned in in a typical month.

With regard to television viewership, the SABC’s free- to-air channels continued to attract significant audiences.

SABC1, SABC2 and SABC3 garnered average audiences of 26.2 million, 24.8 million and 20.2 million adults in a typical month, respectively.
The SABC News channel and SABC Encore channels, which are delivered through satellite broadcast, reached an average of 1.5 million and 5.8 million viewers in a typical month, respectively.

As an indication of the universal appeal of SABC content, at least 13 of the nation’s Top 20 most watched television programmes were SABC programmes.

During the period under review, Parliament published several important Acts and Bills which (if passed into law), will impact the SABC to various degrees.
In addition, to which the SABC made submissions and representations, including the Critical Infrastructure Protection 2019 (Act No.

8 of 2019): Continued Application of the National Key Points Act 102 of 1980; the Copyright Amendment Bill 13B of 2017, Local Content Regulations published by ICASA, Broadcasting Amendment Bill among others.

By the end of the financial year, the average creditors’ days stood at 51 days against a target of 60 days.
Outstanding accounts were settled from the first tranche of the bailout funding received in October 2019.

Average debtors’ days ended the year at 38 days, also against a target of 60 days.

6 16 Further progress was made in the establishment of performance management throughout the SABC.
A commendable 68 percent of all employees had signed performance contracts by the end of the financial year With regard to the strengthening of internal controls, 61 percent of the previous year’s external audit findings had been resolved by the end of the year, against a target of 50 percent.

2.2 Financial Performance Amid lackluster economic activity and due to internal challenges, revenue collected for the year under review was R5.7 billion which was 23 percent under budget.
This figure was 23 percent (R1.7 billion) below budget and 12 percent (R790 million) below the prior year revenue generated.

The decline was impacted by the late delivery of the bailout funds resulting in below budget advertising revenues, impacted by a combination of declining television audiences owing to insufficient levels of fresh and compelling content, and the generally depressed national and global economic performance.
While the Corporation recorded a R511 million loss for the year, this was 20 percent better than the budgeted loss.

Exceptional financial management saw the SABC end the year with a lower loss before interest and tax than expected (R534 million loss recorded against a projected loss before interest and tax of R639 million).
The net loss is mainly due to the following: (i) Cost to income still exceeds 100 percent (FY19 107%); (ii) Salary bill amounts to 45 percent of the total costs (50% of revenue); (iii) Conventional signal transmission costs the Group a significant amount of money; (iv) Advertising is moving more towards digital media coupled with deterioration in economic conditions which puts pressure on commercial revenue; (v) Mandate content impacts Group’s liquidity and in turn doesn’t attract desired revenue margins; (vi) PCS made a small profit (R61m) of which Radio contributed the majority.
PBS reported a loss of R577 million with News and Sport being the main contributors; and (vii) Analysis of the group`s net loss over a 4-year period: - 7 17 The work done to enhance the cost allocation model has afforded the SABC an enhanced view of the true financial performance of each of the radio stations and television platforms.

This has enabled us to devise more appropriate interventions to address the challenges identified.
For the 2018/19 financial year, SABC’s situation had worsened to a cash balance of only R72 million, and a net loss for the year was R482.4 million at year ended March 2019.

However, for the 2019/20 financial year ended March 2020, the Corporation’s cash balance had improved to R 2.133 million albeit with a net loss of R511 million.

As mentioned previously, during the year under review, the SABC received a R3.2 billion bailout from National Treasury with strict conditions.
The bailout was provided primarily to pay creditors, procure compelling content, and acquire broadcast critical infrastructure.

In fact, the moment the R3.2 billion bailout reached SABC accounts, over R2.2 billion of the funds went to paying off our historic debts.

In the month received the final tranche of the bailout, the country, like the rest of the world, found itself in the grip of the deadly COVID-19 pandemic.

Cash reserves closed off the year at R2 billion.


The efforts consisting of key actions, as outlined in the SABC’s Turnaround Plan were initiated and they paid off.

Despite the reduced revenue for the reporting period, costs were significantly reduced, yielding a 19 percent better than the budgeted year-end position.

This strengthened the financial position of the SABC, as evidenced by the resultant current ratio of 2.37.
Solvency of the SABC also ended the year in a much healthier position with a 2.51 coverage ratio.

Key achievements against the Corporate Plan: (i) Ensured the Corporation was able to meet its financial obligations through adequate Cash Management.

By March 2020, Creditors days were 51, well within the set target of 60, concurrently Debtors collection period was 38 days against a set target of 60.
(ii) The Corporation managed its expenditure in accordance with the Approved budget, with R1.8 billion budgetary saving in expenditure.

This was a result of the Corporation taking a measured approach of conserving the available cash resources by delaying and in some cases deferring spending.

However, this was offset by the revenue results being R1.7 billion less than budgeted.

8 18 SABC has been struggling with declining revenues over the past five years.
The table below indicates the proportionate percentage shares of the various revenue streams to the total revenues of the SABC.

Advertising revenue declined by 11 percent (2019: 6%) due to market pressures, constrained investments in content leading to declining audiences, limited marketing initiatives as well as the general economic decline which led to clients reducing their overall advertising spend.
Advertising revenue from radio stations declined across all the platforms, with the Commercial Stations (MG5) declining by R48 million, Fortune 4 (Radio 2000, Lotus FM, SAFM, and Radio Sonder Grense – RSG) declining by R19 million and African Language Stations (ALS) regressing by R 46 million.

Financial difficulties resulted in reduced investment in television program content.

This negatively influenced the audience share and put further downward pressure on advertising and sponsorship revenue.
The SABC managed to generate R9 million (2019: R14 million) from digital and mobile platforms.

It was able to realize only 19 percent of the total licence fees billed during the 2019/20 financial year, lower than the previous period of 31 percent.

Collection cost rate was lower at 4 percent (2019: 12 per cent).

The lower collection cost was due to the absence of Debt Collection Agencies (DCAs), who were only contracted in October 2019.
The licence fee collection rates indicate an evasion rate of 81 percent.

9 19 Lastly, the SABC invested R103 million in capital infrastructure during the financial year and spent R16.2 million (2019: R17.7 million) on maintenance of buildings.

Total expenses before interest and tax declined by 10 percent (R702 million) to R6.2 billion from prior year levels.

A significant portion of the decrease was due to deliberate and targeted cost saving initiatives.
2.3 Audit Opinion The SABC received a qualified audit opinion.

This is similar to the previous financial period.

The basis of qualification was on Irregular Expenditure.

There was, however, an improvement in the audit results as the qualification on property, plant and equipment was resolved.

Total findings raised for the 2019/20 audit are 97.

Even though internal controls require improvement, the audit results do show an encouraging improvement.
Out of 127 2018/19 findings, 85 percent (108) were resolved by the reporting period.

The outstanding findings relate mainly to Policy and Procedure reviews that were still in the process of being implemented.

Over the past three financial years, the audit opinion has improved significantly, moving from Disclaimer to Qualified, see graph below: Even though the qualified audit opinion was sustained from prior year, but areas resulting in the qualification have reduced.
Only qualification on the AFS in the current year relates to Irregular Expenditure.

Strides were made in internal controls around PPE and Performance information.
2.3.1 Irregular Expenditure (i) Irregular expenditure incurred during the year decreased by R134 million from prior year to R202.4 million; 10 20 (ii) The SCM internal control environment is improving but a lot of work still remains; (iii) The application of incorrect evaluation criteria to bids remain the biggest stumbling block to not following procurement policy/processes as it increased by R32 million from prior year; (iv) Payment without contracts although significant decreased by R36 million from prior year remained high; and (v) Consequence management is also being implemented on the already identified IE though it was too late for the year in question.
2.3.2 Fruitless & Wasteful Expenditure (i) Fruitless wasteful expenditure incurred during the year decreased by R197 million from prior year to R27.4 million; (ii) Impairment of content reduced significant due to non-recurring incident in the prior year of South African Football Association (SAFA) sports rights; (iii) Improvement in the liquidity position of the Group reduced interest on late payments; (iv) Significant portion of fruitless and wasteful expenditure relates to interest payments relating to late payment of broadcast costs; and (v) Fruitless and wasteful expenditure written off amounting to R183 million reduced the opening balance.
2.3.3 Going concern The SABC had operating losses of R511 million and negative cash flows from operations for the financial reporting period to 31 March 2020 amounting to R1.2 billion.

However, due to R3.2 billion recapitalisation funding from the shareholder, the working capital position remained healthy with a net current asset position of R1.8 billion.

It remains uncertain when the Company will return to profitability and positive cash flows from operations.
Together with the impact of the COVID-19 pandemic, these uncertainties cast significant doubt on the SABC’s ability to continue as a going concern.

Various measures are in place and continue to be put in place to manage this risk.

2.

USAASA / USAF 11 21 USAASA is a public body as confirmed by Schedule 3A of the Public Finance Management Act 1 of 1999.
The existence, functions, duties and mandate of the Agency are governed by sections 80 – 91 of the Electronic Communications Act 36 of 2005 (“the ECA”) which came into operation on 19 July 2006.

The new amendments to ECA, which have a direct bearing on governance of the Agency, came into operation on 21 May 2014.

The main aim and objective of USAASA is to ensure accessibility, affordability and availability of such universal services within the shortest possible walking distances from such communities.
The Agency, which is the administrator of the Universal Service Access Fund, was placed under the management and control of the Executive Caretaker and Accounting Authority (EC).

Placing the entity under the management and control of the EC was furthermore to assist in overseeing the seamless rollout of a new delivery model that encompassed the direct appointment of local decoder installers.

USAF is established in terms of section 87(1) of the Electronic Communications Act, (Act No.
36 of 2005) as amended by Act No.

1 of 2014) as a financing vehicle to spur Information and Communications Technologies (ICT’s) and rapid expansion in unserved and underserved areas.

Over the years, the Fund has transformed from the ubiquitous deployment of basic telephone equipment and services into funds that are used to support ICT/broadband programmes, which include access to personal computers (PCs) and other digital devices, broadband internet connection, and localized content and services.
USAASA, which is the administrator of USAF, was placed under the management and control of the Executive Caretaker and Accounting Authority (EC).

Placing the entity under the management and control of the Executive Caretaker was furthermore to assist in overseeing the seamless rollout of a new delivery model that encompassed the direct appointment of local decoder installers.
3.1 USASA/USAF Performance Information South Africa’s macroeconomic environment has mostly been under pressure for the period of USAASA’s strategic plan, characterized by a lower than expected growth rate, high structural unemployment, among the highest inequality levels in the world, and unsustainable poverty levels.
The MTSF 2014- 2019 period has fallen far short of the trajectory required by the 12 22 National Development Plan (NDP) to reduce unemployment to 6 percent, eliminate poverty, and sharply reduce inequality by 2030.

The optimal functioning of USAASA was obstructed by several foundational and historical issues that and therefore the fulfilment of its mandate, the first of these was a clear Leadership and Management crisis following the dissolution of the USAASA board in August of 2018 and once again in 2019.
The crisis was further exacerbated by the departure of the then Chief Executive Officer (CEO) in May of 2019 and his subsequent replacement by three acting CEOs leading up to the period of the Administrator’s appointment on 28 January 2020.

The Leadership and Management crisis at USAASA paralysed the Agency to the extent that it was rendered incapable of delivering on its targets.
The lack of delivery by the Agency in the Broadcast Digital Migration Programme (BDM) moved the DTPS to directly intervene on a number of occasions where it attempted to restart the process of installing set-top boxes.
The crippling effects posed by these challenges contributed to a large extent to the ineffective application of broadband connectivity to underserviced areas and also resulted in the inefficient application of the infrastructure subsidy, which led to inefficient expenditure and use of funds by the Agency and also to the long term sustainability of the subsidised network.

All of this culminated to various disciplinary actions, which further affected the Agency’s ability to function effectively.
To date, USAASA has completed the rollout of broadband infrastructure at: 1.

A total 165 broadband sites in the three years prior to the 2016/17 financial year; 2.

A total 295 sites in the OR Tambo District Municipality during the 2016/17 financial year; and 3.

Total 76 and 199 broadband sites in the underserviced municipalities of Impendle Local Municipality (KZN) and Nyandeni Local Municipality (EC), respectively in 2017/18.
A further two municipal areas in the OR Tambo District Municipality are targeted for completion in 2018/19.

This means that there has been over 100 per cent increase in terms of the broadband sites that need to be maintained by USAASA, although there has not been any increase in budget or human resources capacity in order to enable the Agency to deliver on its legislated functional and national policy mandates.
13 23 Furthermore, the implementation of the BDM policy, which mandated USAASA to subsidise around five-million qualifying, needy households (earning below R3 200 a month) for the acquisition of the set-top-boxes (STBs) has created a challenge in terms of the additional reporting responsibility to the DoC.

The Department is responsible for the administration of the BDM Policy and the overall oversight of the BDM programme implementation.
A root cause of one of the audit findings issued by the Auditor-General on USAASA’s and USAF’s 2017/18 financial statements is the Digital Terrestrial Television (DTT) inventory, which has gone missing due to the inability to implement effective stock control measures.

The graph below depict the Agency’s achieved annual targets against the planned annual targets in the 2019/20 approved Annual Performance Plan (APP).
Three (3) of the six (6) planned targets: Some of the significant achievement in the financial year under review include the cumulative 60 percent of the Business Risk Action Plans as per the Risk Register were implemented during the financial year.

The ICT Master plan benchmark report was developed and approved by the Board.

In addition, the Board approved the USAASA 2020-2023 multi-year Procurement Plan.
Areas of underachievement during the reporting period include: • The Agency and the Fund for Q1, Q2 and Q3 of the 2019-2020 financial year managed to meet the target of payment of invoices received within 30 days from the date of receipt; 14 24 • In quarter 4 one invoice under USAASA was not paid within 30 days and USAF invoices were all settled within 30 days; • The outstanding invoice was paid in Q 1 (2020-21) resulting on the target being subsequently achieved; • The Agency and the Fund for Q1, Q2 and Q3 of the 2019-2020 Financial Year managed to meet the target of payment of invoices received within 30 days from the date of receipt; • In quarter 4 one invoice under USAASA was not paid within 30 days and USAF invoices were all settled within 30 days; • The outstanding invoice was paid in Q 1 (2020-21) resulting on the target being subsequently achieved; and • The approval of the 2020-2023 Research Plan was approved by the Executive Committee in Q1 (2020-21) as the initial plan tabled to the Executive Committee was not approved in Q4.
For USAF, the 89.1 percent of the internet access at existing connected sites as the end of the financial year was achieved.

The Board approved the multi-year Procurement Plan of USAF 2020-2023.

Arears of under-achievement during the reporting period include a compliment of 61 sites connected in previous financial years in Joe Morolong and Ratlou Local Municipalities, however, they were not reconnected by year end due to irregularities identified in the initial appointment of the service provider.
An open review by Internal Audit was commissioned to informed the cancellation of the reappointment of the service provider.

The reasons for underachievement are the revision of the BDM service delivery model which resulted in the delayed installation of set-top-boxes in Free State, North West, and Northern Cape.
As at the end of the financial year under review, there were only 4 387 installations of STB’s that took place in Q1 (2019-2020) following the contract expiry on 31 January 2019 for appointed panel of installation companies.

The Fund achieved annual targets against the planned annual targets in the 2019/20 approved USAF APP.
Two (2) of the Four (4) planned targets were achieved, being 50 percent of the total planned targets 15 25 2.2 Financial Performance USAASA recorded a total expenditure of R92.1 million against a total budget of R85.4 million which means that a deficit of R7.3 million was recorded at year-end.

The mentioned expenditure includes an amount of R16.3 million in respect of Depreciation and Amortisation, which is a non-cash item.
The Agency is currently involved in a few legal matters and it was confirmed that the contingent liability at 31 March 2020 was estimated at R126.6 million.

Should the outcomes not favor USAASA, the funding will have to be sourced outside the appropriation of the agency.

An amount of R32.2 million was recorded as irregular expenditure at 31 March 2020 of which R30.5 million stems from previous financial years.
USAASA will deal with the Irregular Expenditure decisively in the following financial year and make sure that consequence management will be applied where required.

A full-time BAC was already appointed to deal with these cases.

For USAF, the initial approved budget was R88 million.

A budget reduction of R24 million was done as an adjustment during the year.

Adjustment was done on the BDM project allocation.


There was also an addition of approved retention of funds amounting to R340.4 million from 2018/19 financial year.

Installation costs incurred relating to distribution of STBs during the year amounted to R1.8 million.

The balance of R26 million relates to contractual escalation costs on previous installations claimed during the year.

Committed funds amounting to R1.1 billion from previous financial year are available to complete the project.
During the 2019/20 financial year, the Agency has received approval from the National Treasury to retain surplus funds for the amount of R340.4 million.

There was, however, a budget reduction recorded against the Broadband Project of R24 million as mention above.

3.2.1 Prior Period Adjustments Expenses and related liabilities to an amount of R648 000 for the 2018/19 financial year were under stated.
An amount of R5.7 million relating to the outstanding cost of the SAP system was initially disclosed as a commitment.

However, in the year under review, this amount has 16 26 been capitalized to the cost of the intangible assets and the related accumulated amortization of R3.8 million recognised.

For USAF, since the initiation of the BDM project in December 2015, the entity had been making prepayments to SAPO for installation costs paid to installers.
As a result of these prepayments, it was discovered during the 2019/20 financial year that the receivables balance of SAPO as at 31 March 2019 was R16.73 million.

The prior year adjustment was done to rectify the records.

There was another prior period adjustment with a net amount of R315 000 relating to the change of project implementation.

Initial implementation of the project involved the inventory issued directly to beneficiaries until year-end 2017.
Subsequently, the project was rolled out with BDM inventory being issued in bulk to installing companies.

This created an overstatement of inventory balance due to inventory being issued but not installed.

Invoices of Broadband projects amounting to R3.3 million from services providers, affecting prior year, were submitted in the 2019/20 financial year and prior year accrued invoices amounting to R2.5 million were disputed in 2019/20 and subsequently reversed.
A net effect for prior year period adjustment of R711 000 was effected.

2.3 Audit Opinion USAASA also received an unqualified audit outcome in the 2019/20 financial year to maintain the status quo.

The unqualified report is based on two findings on non-compliance and no findings in respect of the Annual Financial Statements and Performance Information affected the final audit report.
The basis for the opinion was due to uncertainty relating to the future outcome of litigations with the public entity being the defendant in a number of lawsuits.

The ultimate outcome of the matters cannot presently be determined and no provision for any liability that may result has been made in the financial statements.

For an example, there is litigation with eight employees who received increases in salary, which USAASA is challenging.
The legal counsel estimates the financial exposure of approximately R200 000.

USAASA is engaged in another litigation with an employee who is challenging his dismissal.

There is a review application pending.

The legal counsel estimates the financial exposure of 17 27 approximately R650 000 and Duma Travel issued summons against the Agency for services rendered and has not been paid a total amount of R169 000.
Respective officials have not been properly reviewing compliance matters and monitoring to ensure full compliance concerning fruitless and wasteful expenditure.

Consequence management processes were not in all instances sufficient, as the leadership did not take the appropriate action required in a timely manner for all irregular as well as fruitless and wasteful expenditure incurred by the entity.
The previous Board has instituted a forensic investigation/review in January 2020 on the SAP support and maintenance services to ascertain facts on the matters around the SAP support and maintenance provision or lack thereof.

National Treasury conducts a forensic investigation and at the date of the audit report, the investigation was not concluded.

To ensure full compliance on fruitless and wasteful expenditure, compliance matters have not been properly reviewed and monitored by the respective officials.
Consequence management processes were not in all instances sufficient, as the leadership did not take the appropriate action required in a timely manner for all irregular as well as fruitless and wasteful expenditure incurred by the entity.

For USAF, the six unresolved matters will be subject matter of forensic investigation.
The Agency has conducted an open review process on the inventory balances, the Agency agreed with SAPO for an independent auditor to review the inventory in SAPO warehouses, and SAPO will abide by the outcomes of the investigation.

The 2019-2020 external audit by the AGSA resulted in a qualified opinion for USAF in relation to BDM Inventory Management.

USAF was qualified for three consecutive years on inventory.
This was due to Auditor-General not obtaining sufficient appropriate audit evidence for the inventory disclosed relating to STBs and antennae owned by the entity and held by third parties (SAPO).

Internal Audit conducted an open review that resulted in confirming the basis for the qualification.
3.3.1 Irregular Expenditure During the period under review, ‘Irregular expenditure’, as defined in Section 1 of the PFMA, to the total value of approximately R1.5 million emanated from expenditure beyond the contract period.

The irregular expenditure amounting to R207 000 was due to noncompliance 18 28 with DPSA circular as per Public Protector Report.

The Board resolved on 30 April 2019 for an investigation to be conducted into the irregular, fruitless, and wasteful expenditure.
The investigation has commenced.

For USAF, irregular expenditure of R60,1 million that was incurred in the previous years was still under investigation.
The AGSA was unable to obtain sufficient appropriate audit evidence for the inventory disclosed, as internal controls were inadequate to ensure that all items of inventories relating to STBs, including antennae owned by the entity and held by third parties are properly safeguarded and properly recorded during recognition, as well as when the inventory should be expensed when issued or returned by installers.
There is reason to believe that there is a substantial amount of inventory that cannot be accounted for.

SAPO and USAASA have agreed to appoint an independent forensic investigator to confirm existence of inventory.

The outcome of the investigation may affect the inventory balances in the following reporting period.

The AGSA could not confirm whether all related transactions pertaining to inventory had been appropriately recorded by alternative means.
Consequently, AGSA was unable to determine whether any adjustments were necessary to inventory stated at R889.

6 million (2019: R509.2 million) in the financial statements.

The AGSA was further unable to obtain sufficient appropriate audit evidence for the achievement of 0,36 percent STBs at qualifying households installed reported against target of 66.6 percent of STBs installed in the annual performance report, due to the lack of accurate and complete records.
The AGSA was unable to confirm the reported achievement by alternative means.

Consequently, the AGSA was unable to determine whether any adjustments were required to the reported achievement.

The Board resolved on 30 April 2019 for an investigation to be conducted into the irregular, fruitless, and wasteful expenditure.

4.

SAPO The SAPO SOC Limited was established on 1 October 1991 as a company in terms of the Companies Act, No.

61 of 1973.
61 of 1973.

The State (Republic of South Africa) represented by the Minister of Communications and Postal Services, is the sole Shareholder.

19 29 Following the repealing amendment of the Companies Act, No.

61 of 1973, and the enactment of the Companies Act, No.

71 of 2008 (as amended), the SA Post Office was designated as a state-owned company (SOC) as per the South African Post Office Limited Act, No.

22 of 2011, as amended.


The SAPO is also a major state entity in terms of Schedule 2 of the PFMA, No.

1 of 1999 (as amended).

The SAPO is afforded a legislated monopoly over reserved services.

The Postal Services Act of 1998 charges the regulator, ICASA, with protecting the provision of the universal service through the reserved postal services licensee, namely the SAPO.
Through the SAPOs Universal Service Obligation (USO), a strategic priority for the Company is rolling out new addresses and branches in remote areas, in line with the government’s developmental programme for 2030.

The Postal Services Act further requires ICASA to monitor the incumbent against ‘anti-competitive’ behaviour.
4.1 Performance Information There is a continued mismatch between monthly revenues generated and corresponding operating expenditure, resulting in a deficit to meet monthly financial obligations, which has now been aggravated by COVID-19.

The R2.9 billion funding allocation received on 25 January 2019 has been utilised to settle all loans and the payment of critical suppliers, and as at 31 March 2020, the funding has been depleted.
The Mail delivery standard has steadily improved over 2019/20 FY and the annual target of 80 percent was achieved at 89.25 percent, just below the ICASA regulated standard of 92 percent.

ATM and POS (Point of Sale) uptime as well as the IT Network upgrade did not achieve the annual target; however, both at a level of 80 to 99 percent of target with the IT Network upgrade attaining 81 percent of target whilst the ATM and POS uptime attained 99 percent of target.
A total of 17 Key Performance Indicators (KPIs) were set and measured for the 2019/20 FY, with only 6 KPIs achieving 100 percent of target resulting in overall performance of 35 percent.
Performance highlights for the year under review include the following: • The delivery standard of 89,25 percent improved by 12.85 percent from the prior year; • Delivery of approximately 535 million items during the year; • Security features at branches improved; • Postbank ATM and point of sale transactions at 99 percent of industry standard and 20 30 • Reduction of 45 percent in crime incidents from 4876 to 2682; • Universal Service Obligation to 529 USO branches located in rural and under-serviced communities; • The target for Carbon emission (Scope 1 and 2) was achieved with an annual performance of 2 percent above target; • Appointment of the six Regional General Managers for Operations; • Total 8.1 million SASSA beneficiaries paid monthly; • Total 2.6 million schoolbooks delivered to 3,873 schools in Limpopo and Northern Cape; • Total 637 094 new street addresses rolled out; and • Total 1 151 194 qualifying beneficiaries registered for the DTT subsidised set-top box and 549 426 STBs issued.
The planned investment in property maintenance was not achieved due to funding challenges however both the maintaining of the USO points of presence and increasing the number of postal addresses was achieved.

The annual target of 500 000 addresses has been achieved and substantially exceeded by 137 094 additional addresses, an achievement of 127.4 percent of target.

The total actual addresses rolled-out is 68 percent in rural and 32 percent in urban communities.
All addresses rolled out for 2019/20 financial year have been for street delivery.

The annual revenue is below target by 8 percent due to lower than projected revenue performance.

Mail revenue remains the main contributor but on a steady decline due to traditional mail substitutions.

There is a continued mismatch between monthly revenues generated and corresponding operating expenditure, resulting in a deficit to meet monthly financial obligations, which has now been aggravated by COVID-19.
Whilst the digital strategy towards attaining Vision 2030 was developed and approved, the launching of the E-Pay and Omni-Channel Platforms were delayed due to procurement and related matters.

During the 2019/20 financial year, the term of the non-executive directors of the Board expired and new Directors were appointed with a new Chairperson.

The positions of CEO and COO also became vacant during the financial year.

The position of CFO also remained vacant.


The 21 31 position of CEO is now finalised with the appointment of Ms Nomkhita Mona, and a headhunting process is underway to replace the CFO who resigned after a short tenure.
A number of other Executive positions have remained vacant during the 2019/20 financial year but are currently moving into the recruitment phase 4.2 Financial Performance Revenue of R4.1 billion for the year ending 31 March 2020 (2019: R5.3 million) with Postbank revenue of R1.8 billion included in 2019.

The Postal services revenue of R2.8 billion (increase of 0.2%).
The financial services revenue of R1.2 billion increased by R606 million due the full year revenue of R735 million for SASSA transactions in 2020 (2019: R108 million for SASSA transactions).

The R2.9 billion funding allocation received on 25 January 2019 was utilised to settle all loans and the payment of critical suppliers.
The annual revenue is below budget due to lower than projected revenue performance in Postal Services Revenue -R36m, Courier and Parcel Revenue -R187 million, and Sundry Revenue - R274 million.

Included within Sundry Revenue, is the 2019/20 Revenue Initiatives which did not deliver as expected.

Operating costs of R6.5 billion was reduced by 5 percent from R6.8 billion in 2019 and staff costs increased by 3.6 percent to R3.9 billion and contribute to 60 percent of operating costs.
Loss for the year increased by R689 million to R1.8 billion with R1.1 billion loss for year for 2019.

By 1 April 2019, Postbank is required to prepare separate annual financial statements and cannot be consolidated into SAPO Group financials from 2020.

Postbank profit of R544 million reduced the Group net loss position in 2019.

Therefore, group loss excluding Postbank for 2019 was R1.6 billion.
Expenses have exceeded revenue, resulting in operations utilising cash of R716 million for 2020 and R1 billion for 2019.

Net cash from finance activities includes an amount of R2.9 billion equity received in January 2019 and amount of R1 billon was utilised to settle terms loans.

A total of R475 million subsidy to fund USOs reinstated in 2020.

And R42 million was utilised for capex in 2020.


22 32 Following are copies of slide presentations made to the Committee indicating erratum on tabled Annual Report: 23 33 Erratum: Going concern (note 46) 24 34 SAPO, as a state company, plays a strategic role in the provision of essential goods and services.

The activities of the SAPO impact on the quality, accessibility and affordability of services provided to the community, especially the poor and vulnerable.
In determining the appropriate basis of preparation of the financial statement, management are required to consider whether the group will continue in operational in the near future.

The conditions noted below resulted in a material uncertainty that might cast significant doubt on the SAPOs ability to continue as a going concern: Group and company reported a net loss of R1.79 billion.

This represents a 39 percent increase in losses since the prior year.
The substantial movement was as a result of the transfer of assets to Postbank during the current year.

The transfer saw an estimated value of R400 million in profits being shifted to Postbank.

Group is faced with a low revenue base and high fixed costs.

Employee costs comprised of 94 percent of a reduction in revenues.

Essentially, for every R100 rand generated by the group, R95 is used to pay salaries.
This high employee cost based renders most plans ineffective with only negligible funds available for operations.

This ratio increased by 40 percent since 2019.

Existence of contingent liabilities, provisions, tax liabilities disclosed in the annual financial statements, the group have contingent liability to the value of R122 million as at year-end.

Financial difficulties such as defaults on suppliers’ agreements, denials of trade credit from suppliers, this included the effects of COVID regulations.
Lack of funding to fund for new capital projects and revenue initiatives, old and aging infrastructure backlog and outdated operating assets making competing in the market space almost impossible.

Outdated IT solutions making competing in the market space almost impossible and an inappropriate and inefficient business model that has resulted in the Group not generating sufficient revenue to finance its high cost base.
Continuous decrease in mail volumes and revenue due to emergence of a highly successful competitor - there has been a number of competitors that have captured the courier market and the migration to digital communication has resulted in a significant decline in mail business over the past years.
25 35 Loss of a major market, revenue from mail services has been on a declining trend, a number of key customers are migrating to digital platforms, and a significant decline has been noted for the courier business.
Based on the above events the SAPO is without doubt currently experiencing substantial doubt on going concern, notwithstanding the substantial doubt based on the above events and conditions, management has adequate plans in place to mitigate this risk as detailed below: • The group has requested COVID-19 relief for the current year.

• The group has also developed a turn-around strategy to improve the financial position of the group.
• The following interventions will improve revenue performance for short and long-term financial year(s).

• ICASA has approved a 7.7 percent increase for postal services (reserved area).

• Standard letter increase by 35 cents from R4.55 to R4.90 (including VAT) 5.5 percent increase for the unreserved markets.

DTT project revenue of R158 million for 2020/2021 FY and R141 million for 2021/2022 FY is included in the budget.
This is based on funds already received from the DTPS and awaiting the rollout of the DTT STB kits.

Through partnerships, revenue will also be generated directly from citizens, not included in the subsidy, through purchasing the devices from the SAPO.

SASSA transaction fees generated from the disbursements of social grants to the beneficiaries are as reflected below and included in the budget as part of the financial services revenue.
• 2020/2021 financial year - R805 million, 2021/2022 financial year - R845 million, 2022/2023 financial year - R888 million SAPO is engaging in partnerships to grow the current revenue streams by undertaking the following initiatives: • Entering into partnerships with lessees on the basis that they are exempt from rental payments for a period covering the lease allowance amount that would be incurred.

This will improve the rental revenue base in the Medium Term Expenditure Framework (MTEF) period.
26 36 • Increasing the number of post office branches offering the motor vehicle licensing services.

The increment on this revenue is expected to yield R48 million in the current financial year.

• Increase in revenue by R100 million due to expansion of the AARTO infringements’ notices delivery services.

The rollout is to be expanded over the areas currently covered.

• R50 million increment in the recovery of costs incurred pertaining to transfer pricing to Postbank for the use of Post Office branches.
• Implementation of e-commerce, which will have a direct impact on the number of parcels couriered through items purchased on our e-commerce platform.

• The increment in revenue is expected to be R36 million, R200 million from sale of properties that were approved for disposal.

The services covered in the partnership is to exclude services already offered.

- Enter into a partnership with a service provider on the distribution and warehousing of medical supplies.
Currently the post office is providing pick up points and the other services, distribution and another company provides warehousing.

The partnership is for the post office to expand its scope and participate in the distribution and warehousing of the supplies.

This will yield additional R87 million on revenue.


Staff voluntary severance packages approved in the 2019/2020 financial year will result in lower staff cost for the 2020/2021 financial year and further cost reductions of R300 million has been included in the budgets for the 2021/2022 financial year.
This reduction is made possible by the severance packages that were paid in the 2019/20 financial year relieving the payroll bill as of 1st April 2020 with the cost associated with the employees that have left.

As a result of the severance payments planned prior to the end of the 2019/20 financial year, the base cost (2019/20 financial year became higher.

Some of the part time employees were also absorbed and this results in curbing the over-time payments previously made to them.
Due to excess staff within the organization, overtime and night duty allowances are also managed to further realize cost reductions and have already been adjusted for in the budgeted amount.

27 37 Security costs have been reduced by R286 million due to lower contractual obligations and cost optimization due to the investments that will be made in improving the security infrastructure.
The above revenue and expense initiatives are crucial to ensure that the SA Post Office financial position is improved over the medium term with the net loss of R177 million projected for the 2020/2021 financial year.

4.3 Audit Opinion The AGSA issued a “Disclaimer of Opinion” for the year under review.

Management to focus on resolving the significant matters to improve the control environment and audit outcome in the 2020/21 financial year.
The group and company incurred losses of R1.8 billion R1.7 billion, respectively, for the year ended 31 March 2020.

Furthermore, at that date, their current liabilities exceeded their current assets by R1.5 billion and R1.4 billion for the group and company, respectively.

The group and company were therefore commercially insolvent because they were unable to pay their debts as and when they were due, even though their total assets exceeded their total liabilities.
The group and company incurred irregular expenditure of R215.9 million and R198.4 million, due to payments made for procurement in contravention of treasury instruction notes relating to uncompetitive bidding processes.

The amounts of R122.6 million and R120.9 million have been disclosed as contingent liabilities for the group and company respectively.

5.
Committee Observations The Committee made the following observations to the entities: 5.1 SABC The Committee noted: (i) and expressed appreciation for the annual report presentation by the SABC; (ii) with concern that only 59 percent of the annual performance targets were received, with a net loss of R511 million; 28 38 (iii) with concern that for the high distribution costs charges by Sentech which impacts the SABC; (iv) and appreciated interventions made by the Department relating to the Section 189 retrenchment process; (v) and commended communication improvement between all relevant stakeholders such as the unions, freelancers and the SABC board, which resulted in a reduction in the figure of retrenched workers from 600 members to 303 members; a. with reservation that the Section 189 retrenchment process is the favourable option after all other avenues had been explored to reduce the retrenchment numbers; b. with caution that the SABC is perceived to be negotiating in good faith with all the stakeholders; (vi) with concern that TV licence collections are still below target; (vii) the need for the SABC to be futuristic and thereby become self-sustainable; (viii) with great concern the weakness in internal control measures in the procurement process leading to high irregular expenditure; (ix) with concern the performance decline of the SABC; (x) with appreciation that the SABC, under the stewardship of management and board, is headed the right direction as is expected by the Committee; and (xi) with great concern that the SABC was still paying service providers without the necessary contracts.
5.2 USAASA/ USAF The Committee noted: (i) with serious concern that the Minister is regularly absent from meetings whereas she is the political head of the Department legislated to account before the Committee; (ii) with appreciation the appointment of the USAASA Acting Chairperson of the Board; (iii) with concern that the Committee was not informed of the appointment of the interim Board; (iv) with serious concern the mediocre performance of USAASA having not achieved half of its set targets; (v) with concern that USAASA lacks capacity to deliver on its mandate; (vi) the progress made by the Department to recruit personnel and that the Rapid Response Team was not yet finalised; and 29 39 (vii) with serious concern that National Treasury may not intervene and guarantee funds towards distribution of IDTVs.
5.3 SAPO The Committee met on 12 May 2021 to deal with the outstanding issues dealing with the 2019/20 Annual Report.

The Committee received this presentation in conjunction with the presentation by SAPO on its 2021/22 Annual Performance Plan and Budget.

Below find the observations and recommendations in respect of the briefing.
The Committee noted: (i) that amendments were made to the Annual report as submitted to Parliament and that the AGSA indicated there would be another submission of the Annual Report for 2019/20; (ii) with great concern the low level of performance by SAPO as reflected in the annual report; which is a reflection of the dire state of affairs at the post office; (iii) that the strategic objectives of SAPO focused on improving the effectiveness of its business processes and operational environment; (iv) that the mail delivery standard has steadily improved and the annual target of 80 per cent was achieved; (v) that the planned investment in property maintenance was not achieved due to funding challenges; (vi) that the R2.9 billion funding allocation received on 25 January 2019 was utilised to settle all loans and the payment of critical suppliers; (vii) that the term of the non-executive directors of the Board expired and new Directors were appointed with a new Chairperson; (viii) with great concern the future sustainability of SAPO, in light of the AGSA’s emphasis of the entity’s going concern basis; and (ix) that the position of CEO has been finalised with the appointment of Ms Nomkhita Mona.
6.

Recommendations The Committee made the following recommendations to the entities: 6.1 SABC The Committee resolved that the Minister should ensure that: 30 40 i. public broadcasting remains a service delivery priority for the purposes of protecting the democratic ideals of South Africa; ii.

the SABC addresses the root cause of performance decline and continues to reduce iii.

iv.
iv.

v. unnecessary spending; the SABC improves on annual performance targets; the SABC improves internal control measures in all procurement processes; the SABC urgently addresses and halts the payment of service providers without the necessary contracts; vi.
the SABC strengthens internal capacity to deal with all audit challenges; a. the SABC improves on its audit report for the financial year 2021/22, to an unqualified audit opinion; b. processes are in place to address audit outcomes and ensure that irregular expenditure issues are addressed; vii.

the SABC improves internal controls at leadership and financial management levels; viii.

the appointment of a Senior Manager, Supply Chain Division is expedited in order to guarantee accountability; ix.
processes are in place for the SABC to implement consequence management where needed; x. the SABC provides a detailed report to the Committee on (i) plans to improve internal control measures in the procurement processes; and (ii) plans to address high irregular expenditure; xi.
consultation between all stakeholders, including unions and SABC Board members, continues in good faith; a. the SABC management, in particular, engages in good faith and is able to engage within reason considering it is a matter involving people with families; b. retrenchments are a last resort after all other alternatives have been explored; c. the SABC considers reskilling employees as a measure to absorb and retain skills; xii.
an action plan is in place to regularly address all concerns raised by the Committee and that the SABC provides the Committee with this action plan for monitoring of implementation; xiii.

the Department facilitates continuous engagement between Sentech, ICASA and the SABC, in order to ensure that broadcasting signal distribution costs are reasonable for public broadcasting; 31 41 xiv.
the funding model of the SABC is urgently addressed and that there is clarity about the SABC’s public mandate and ring-fenced funding and that processes are in place for the SABC to generate alternate income streams; xv.

the Presidency urgently addresses the SABC’s public mandate matter by: (i) looking at available State resources to support the public broadcaster; and (ii) appointing a team of experts to assist the repositioning of the SABC as a world-class public broadcasting corporation; xvi.
the Department, in consultation with National Treasury, assists the SABC in financing its public mandate interventions brought about by the COVID-19 pandemic and that further negotiations are undertaken in view of all other unfunded mandates; xvii.

the SABC retains and increases audience viewership by offering compelling content; xviii.

the SABC improves TV licence collection processes; xix.
the Department considers regulating all streaming services as alternative or additional TV licence fees collection streams; xx.

the digital system to notify consumers on licence renewals is updated and, where possible, a request option for debit orders be offered as an alternative; and xxi.

the Department provides the Committee with an update on discussions with ICASA regarding the Must-Carry and Sports Broadcasting Regulations and how these will impact on the sustainability of the SABC.
The Committee will approach the Standing Committee on Appropriations to request assistance on all challenges facing the SABC.

Furthermore, the Committee will endeavour to meet with all social media network operators to ensure that these organisations, when doing business in South Africa, are acting in a fair and competitive manner that is in the interest of the Republic.
6.2 USAASA/USAF The Committee resolved that the Minister should ensure that: (i) the executive is present at all important briefings of the Committee such as annual report tabling; (ii) all critical vacancies are filled in the Department and its entities; (iii) SAPO supports USAASA in the rollout of Set Top Boxes (STBs); (iv) USAASA provides the Committee with timelines with which it will successfully deliver on its targets; 32 42 (v) the Committee receives progress reports on the processes relating to reconfiguration of the Department, rationalisation, recapitalisation and mergers of entities which must include a roadmap and timelines; (vi) the Committee receives regular updates with clear timelines on the progress in respect of the establishment of the Digital Development Fund; (vii) the response team functions efficiently and effortlessly without governance challenges; (viii) all performance issues at USAASA are addressed expediently and consider the capacity challenges as fundamental to successful performance; (ix) USAF addresses all skills gaps; (x) USAF demonstrates serious commitment to meet its targets; (xi) the Committee is responded to on all previous questions, and in particular, whether the IDTVs process would be completed; (xii) the relevant people are present and available in future meetings so that it does not give an impression of dysfunctionality; (xiii) USAASA adheres to resolutions made by the Committee, failing which it should provide reasons; (xiv) the focus by USAASA be towards the implementation of digital transformation; (xv) the major challenges in contract management and evaluation at USAASA are resolved; (xvi) USAASA provides the Committee with updates in order for it to monitor its progress in respect of the improvement of its financial position; (xvii) USAASA provides a report about the challenges to improve sites connectivity in the North West Province; (xviii) USAASA provides a plan to complete the delivery of Set Top Boxes (STBs) in problem areas; and (xix) USAASA updates the Committee comprehensively on all disciplinary proceedings at the Agency.
6.3 SAPO The Committee resolved that the Minister should ensure that: (i) measures were in place to improve SAPO performance for the year ahead and in order to change the situation as was reflected in the annual report of 2021/22 at it could not be implemented in the 2020/21; 33 43 (ii) all critical vacant posts are filled; (iii) management resolves the significant matters as identified by the Auditor General so as to improve the control environment and audit outcome in the next financial year; (iv) SAPO finalises its turnaround strategy so as to address the sustainability and relevance of the entity; (v) SAPO improves on its operational performance to achieve local and international compliance standards; (vi) digital migration is fast-tracked by reducing the warehouse stock of DTT equipment; (vii) there is better collaboration between SITA and SAPO in addressing the matter of repositioning of SAPO in order to stabilise and speed up IT and digitisation; (viii) the Department urgently addresses the issue of SAPO funding and the going concern; and (ix) an updated annual report is tabled in Parliament as soon as possible.
Report to be considered.

34 44 4.
34 44 4.

Report of the Portfolio Committee on Communications on the draft notice determining the remuneration of councillors of the Independent Communications Authority of South Africa (ICASA), dated 2 June 2021 The Portfolio Committee on Communications, having considered the draft notice of the President’s determination of the salaries and allowances of members of various institutions, including Councillors of the Independent Communications Authority of South Africa on 26 May 2021, reports as follows: 1.
A letter, dated 13 April 2021, was received from the President of the Republic, requesting the Assembly to consider the draft notice of his determination of the salaries and allowances of members of various institutions, including Councillors of the Independent Communications Authority of South Africa in terms of the Determination of Remuneration of Office-Bearers of Independent Constitutional Institutions Laws Amendment Act, 2014 (Act No.

22 of 2014).

2.
22 of 2014).

2.

On 22 April 2021, the matter was referred to the Committee for consideration and report.

3.

Section 219(5) of the Constitution of the Republic of South Africa, 1996, provides that national legislation must establish frameworks for determining the salaries, allowances and benefits of judges, the Public Protector, the Auditor-General, and members of any commission provided for in the Constitution, including the broadcasting authority referred to in section 192 of the Constitution.

4.
4.

The Determination of Remuneration of Office-Bearers of Independent Constitutional Institutions Laws Amendment Act, 2014 (Act No.

22 of 2014), which came into operation on 1 April 2019, creates the necessary framework to determine the salaries of office-bearers of Chapter 9 institutions mentioned in the Constitution.

5.

Section 10 of the Independent Communications Authority of South Africa Act, 2000 (Act No.

13 of 2000) dictates that: Salary, allowances and benefits of councillors of Council.
— (1) The chairperson and other councillors are entitled to the salary, allowances and benefits — 45 (a) as determined by the President, from time to time, by notice in the Gazette, after taking into consideration the recommendations of the Independent Commission; and (b) approved by the National Assembly in terms of subsection (5).

6.
6.

Having taken into account the serious economic challenges that the country faces and the constrained fiscal environment, the President, proposed remuneration levels with effect 1 April 2020 of ICASA as follows: • that a 0% salary freeze for all public office bearers for the financial year 2020/2021in terms of Notice No.

941 published in the Government Gazette No.

43666 of 28 August 2020 as repealed.

Recommendation 7.
Recommendation 7.

The Committee, having concurred with the President’s determination on the remuneration adjustment of ICASA Councilors that a salary freeze of 0% for the Chairperson and other Councillors be implemented, recommends that the National Assembly approve the draft notice determining the remuneration of Councillors of the Independent Communications Authority of South Africa (ICASA).

[The Democratic Alliance reserved its right in terms of the recommendation in the Report.]
Report to be considered.

2 46 National Council of Provinces 1.

REPORT OF THE SELECT COMMITTEE ON TRADE AND INDUSTRY, ECONOMIC DEVELOPMENT, SMALL BUSINESS DEVELOPMENT, TOURISM, EMPLOYMENT AND LABOUR ON BUDGET VOTE 31: EMPLOYMENT AND LABOUR, DATED 1 JUNE 2021 1.
Background The Select Committee on Trade and Industry, Economic Development, Small Business Development, Tourism, Employment and Labour, having considered Budget Vote 31: Employment and Labour together with the Departmental Annual Performance Plan and Strategic Plan, tabled by the Minister of Employment and Labour, in terms of the Public Finance Management Act of 1999 (PFMA), as well as the Money Bills Amendment Procedure and Related Matters Act, 2009, reports as follows: 2.
Committee Process The Select Committee on Trade and Industry, Economic Development, Small Business Development, Tourism, Employment and Labour was briefed by the Department of Employment and Labour (Del) on Budget Vote 31, focused on the Medium Term Strategic Framework (MTSF), 2020-25 Strategic Plan and the 2021/22 Annual Performance Plan (APP) including the 2020-2025 Strategic Plan and 2021/22 Annual Performance Plan for the Supported Employment Enterprises.

The meeting was held on 25 May 2021.

3.


Introduction The Committee observed that the annual performance plan and budget of the Department are aligned to the Medium Term Strategic Framework (MTSF), National Development Plan, and the recently launched Economic Reconstruction and Recovery Plan.

1 47 It was further submitted that the spending plans were presented within the current current fiscal condition, and COVID-19 context.

The Committee noted that the COVID-19 disrupted the socioeconomic system.
In 2020, South Africa economic growth shrank by 7.7 per cent, and this year the economy is anticipated to re-gain, and increase by approximately 3 per cent.

Jobs have been affected.

The current fiscal condition has caused reprioritisation of the spending plans.
Retail (excluding food), automotive, hotels and restaurants, airlines, travel operators, arts and entertainment, and personal services like hairdressing, firms and workers were mostly affected including manufacturing, were some of the industries that were severe affected.

The Department indicted that the pandemic has caused huge disruption in global economy, and national economies.

When South Africa entered the COVID-19 outbreak phase it was already experiencing weak fiscal position.
Further, global rating agencies have downgraded the economy to an unattractive investment level and that would increase the cost of government borrowing.

State owned entities remains a risk.

It was noted that rising unemployment remains a challenge.

It was reported that the economy needs to significantly grow.

Further declining real GDP per capita, and low business sentiment are some of the risks that need to be addressed.

Many households remain financial vulnerable.


Poverty and inequality remains a major challenge.

Unskilled, and semi-skilled workers are projected to be hit hard by the COVID-19 pandemic.

It was reported that some of the businesses would not survive under the current economic and health crisis.

Jobs remains at high risk.

The Committee emphasised that the capacity of Commission for Conciliation, Mediation and Arbitration (CCMA) should be enhanced.
As the current economic condition would affect labour market and industrial relations.

The Committee emphasised that unemployment should be tackled urgently.

Job creation initiatives should be accelerated.

Further, the Committee stressed that partnerships amongst social partners should be enhanced.

The National Economic Development and Labour Council’s (NEDLAC) remains an essential institution to facilitate strategic dialogue to tackle unemployment.
The economy should be more inclusive, many people feel excluded, emphasised the Committee.

2 48 4.

Overview of the Legislative and Policy Mandate of the Department The aim of the Department is to play a significant role in reducing unemployment, poverty and inequality by pursuing the objectives of decent work for all through employment creation and enterprise development.
Further, it aims to set the standards and the protection of rights at work, including the facilitation of equal opportunities and social dialogue, and the provision of social protection.
Apart from the Constitution of the Republic, the legislative framework which informs the work of the Department constituted by the Labour Relations Act (1995), the Basic Conditions of Employment Act (1997), the Employment Equity Act (1998), the Occupational Health and Safety Act (1993), and the Employment Services Act (2014).

Further the Bill of Rights is pivotal section in the Constitution which find expression through various acts that regulate labour matters in South Africa.
Approximately R57 billion was paid to cover over 4,5 million laid off workers including their families through the UIF COVID-19 Ters Benefit Payments.

This was part of government commitment to preserving the economy, including protecting jobs.
Over the medium term, the Department and its entities will focus on the following policy mission: • Improve economic efficiency and productivity; • Facilitate the creation of decent employment; • Promote labour standards and fundamental rights at work; • Provide adequate social safety nets to protect vulnerable workers; • Promote and enforce sound labour relations; • Further, to promote equity in the workplace; • Eliminate inequality and unfair discrimination in the workplace; • Enhance occupational health and safety awareness and compliance in the workplace; • Give value to social dialogue in the formulation of sound and responsive legislation and policies to attain labour market flexibility for the competitiveness of enterprises, balanced with the promotion of decent employment.
3 49 The Department reported that the COVID-19 pandemic had severe affected economic activity, and impacted in a more negative jobs.

In 2020 activity decline by 7,7 per cent and 1,7 million jobs were lost.

The third wave remains a risk to economic activity and job creation efforts.

It has been recognised by the Committee that the impact of the pandemic has ravaged the economy, and affected negatively jobs and caused strain to households and many companies.
The Committee noted that the current situation presents a high risk to the UIF.

The UIF remains a vulnerable.

The 2021 began with recorded 32 per cent of unemployment.

Hence it is critical for the Department to scale-up employment creation initiatives.

The Committee noted that the current economic and health crisis, and the present fiscal condition would affect spending, as a result some of the targets and programmes have been affected.
However, the policy direction and policy priorities remains the same.

The work of the Department is aligned to the National Development Plan and the Economic Reconstruction and Recovery Plan.

5.
5.

Budget Policy Area Over the 2020 medium term, the Department emphasised that resources will be allocated to fulfil the following spending priorities: • Supporting work seekers; • Increasing safety and fairness in the workplace; • Regulating the workplace to establish minimum working conditions and fair labour practices; As already reported in this report, the work of the Department is aligned to the NDP and the ERRP.
The resources are allocated to the following critical functional policy areas, namely; Programme 2: Inspection and Enforcement Services; Programme 3: Public Employment Services and Programme 4: Labour and Industrial Relations.

Programme 1: Administration providing overall core administrative support to enable the three functional policy areas to realise their legislative and policy functional requirements.
4 50 Over the medium term, the Department will continue to work to ensure that the labour market is well regulated, and stabilise the labour relations.

A safe, humane and equitable work environment are preconditions for attracting investment for growth and employment creation.
Further the work of the Department is functional structured to respond to the following Medium Term Strategic Priorities: • Priority 1: 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 Basic Services; • Priority 5: Spatial Development, Human Settlements and Local Government.
This priority has been identified by the Department that it does not have direct impact to its policy functional area.

• Priority 6: Social Cohesion, Safer Communities; • Priority 7: A Better Africa and a Better World; As the response to the employment creation mandate, in the current financial year the Department will finalise the National Employment Policy, which will be supported by strategies on employment as well as focused programmes.
Further, the Labour Migration Policy will be finalized in the current financial year.

These policies are a response to the changing environment of climate change, energy challenges, increased unemployment, heightened migration and the Fourth Industrial Revolution (4IR).

The Department would leverage existing resources within the Department and its entities, in particular the UIF and CF to create and preserve jobs.

Further, scale-up Labour Activation Programmes.


Over the medium term, the High Impact Social Fund and the Project Development Partnership Fund will be utilised to support the growth of small and medium enterprises.

This initiative will be undertaken in collaboration with the Department of Small Business Development.
In accordance with the Job Summit Framework Agreement, the Department has reviewed the Temporary Employer/Employee Relief Scheme (TERS), shifting focus towards support for 5 51 actual existing jobs in distressed companies.

This involves referrals from the CCMA subsequent to the Section 189A process.

The scheme is expected to expand its impact with the development of improved turnaround times for applications for TERS funding.
Over the medium term, the Department is expected to increase the capacity and capability of NEDLAC (National Economic Development and Labour Council) to promote social dialogue between the social partners.

NEDLAC remains a strategic institution that support government efforts to attain an ‘inclusive growth’.

A major objective is to create the conditions for increased business confidence to unlock investment for growth and jobs.
Coordinating all government efforts to create jobs and reduce unemployment remains one of the highest priorities.

In the main is to continue to engage other departments including the private sector in order to increase cooperation and alignment in tackling the current unemployment challenges with clear policies and strategies.

Over the medium term the Department reported that it will establish vocational services through the Public Employment Services (PES).
It is anticipated that the work seekers will get proper advice on job opportunities, will be registered on the employment database and, where possible, matched to the job opportunities available.

Inspection and Enforcement Services (IES) will continue to consider ways to innovate the way in which its service offerings are presented to its clients.
The Department will continue to focus on the implementation of the Employment Equity Act, including National Minimum Wage Act and the Basic Conditions of Employment Act.

Another pivotal area over the medium term is the spending on health and safety taking into account certain health and safety measures that companies need to take to protect workers in workplaces in response to COVID-19 pandemic.
Further, the would ensure that employers comply with Unemployment Insurance Act, Unemployment Insurance Contribution Act and Compensation for Occupational Injuries and Diseases Act legislative requirements.

The Department has set a target to facilitate a progressive increase (2 per cent annually increase) of representation of Africans in senior and middle management levels.

Further, 6 52 persons with disabilities’ interest will also be placed at the centre of government transformative agenda.
The Department intends to increase the representation of Person with disabilities.

As already stated elsewhere in the report that the spending plans were crafted within the current fiscal condition context.

The current budget policy context has affected the targets and programmes.

But the policy direction and priorities remain the same, with more emphasis on employment creation.

6.
6.

Spending Over 2021 Medium Term Over the medium term, the Department is anticipated to spend approximately R10,6 billion after baseline reductions of R351.4 million in 2021/22; R450.5 million in 2022/23 and R378.7 million in 2023/24.

The funds would enable the Department to realise government policy priorities.

COVID-19 would certainly have a negative effect on the economy and jobs.

Public Employment Services will be pivotal to support job seekers including retrenched workers.
The government’s Economic Reconstruction and Recovery Plan would require the department to play a more focused and essential role in coordinating efforts contributing to the creation of jobs.

Private sector resources would need to be leveraged by the department to fully meet the policy priorities.
Table 1: Summary of the Departmental Spending for the 2021 Medium Term Expenditure Framework 7 53 Programme R million Administration Inspection and Enforcement Public Employment services Labour Policy and Industrial Relations Total Change to 2020 Budget estimate Economic classification Current payments Compensation of employees Goods and services Transfers and subsidies Provinces and municipalities Departmental agencies and accounts Foreign governments and international organisations Non-profit institutions Households Payments for capital assets Buildings and other fixed structures Machinery and equipment Total Revised estimate 2020/21 891.2 598.0 588.7 1 162.8 Average growth rate Average: Expenditure/ Total 2017/18 - 2020/21 Medium-term expenditure estimate 2023/24 2022/23 2021/22 0.1% 4.0% 1.8% 2.5% 26.9% 18.0% 17.9% 1 003.9 633.8 610.2 1 026.8 637.2 618.9 1 030.4 638.4 621.6 37.1% 1 257.9 1 276.4 1 280.9 Average growth rate Average: Expenditur e/ 2020/21 - 2023/24 5.0% 2.2% 1.8% 3.3% 28.5% 18.1% 17.6% 35.9% 3 240.6 2.0% 100.0% 3 505.7 3 559.3 3 571.2 3.3% 100.0% (397.2) 1 900.4 1 334.6 565.7 1 278.8 0.7 1 065.4 19.6 189.3 3.8 61.5 15.3 46.2 3 240.6 – – – 2.1% 3.2% -0.5% 3.2% 14.1% 3.5% -6.4% 2.9% 22.5% -16.6% 2.9% - -51.7% 6.5% 8.7% 5.8% 3.3% 59.0% 39.5% 19.5% 39.0% 0.0% 32.4% 0.8% 5.8% 0.0% 2.0% 0.5% 1.5% 100.0% Source: 2021/22 Estimates of National Expenditure, National Treasury It was reported that the total medium-term reductions were R1.2 billion of which R666.5 million was made on Compensation of employees and R301.7 million on the transfer to the Commission for Conciliation Mediation and Arbitration.
The purpose of Programme 1: Administration is to provide strategic leadership, management and support services to the department.

The Programme over the medium is expected to spend over R3 billion.

The Programme receives the 2nd largest budget.

The Department reported that it will to continue to maintain vacant funded posts at 3 per cent or less in each and every quarter.
In terms of gender responsive recruitment, the Department indicated to reach 45 per cent of the annual target of SMS positions occupied by women.

The target is expected to reach 50 per cent in 2023/24 financial year.

8 54 Over the medium term, the Department is expected to invest on ICT infrastructure to modernise governance.

Further, intensify initiatives on fighting corruption by rolling out Ethics Management Plan, and pay attention on disciplinary incidents and criminal related incidents.
Further, the Department reported that it will ensure that the number of Annual Financial Statements (AFS) and Interim Financial Statements (IFS) compiled per year comply with guidelines issued by the National Treasury was achieved within 30 days after each quarter.
The Department will ensure that it achieve 100 percent of detected occurrences with regard to all detected irregular and unauthorised expenditure cases and also on fruitless and wasteful expenditure cases per financial year to be reported to the Accounting Officer quarterly.
In terms of Programme 2: Inspection and Enforcement Services (IES), it is expected over the 2021 medium term to implement the following: Protect vulnerable workers through the inspection and enforcement of labour legislation by ensuring that decent work principles are adhered to by the end of 2021/22, by: • Conducting 266 600 compliance inspections; • Serving 90 per cent of noncompliant employers inspected with a notice in terms of relevant employment law within 14 calendar days of inspection; • Referring 65 per cent of employers who fail to comply with a served notice to prosecute within 30 calendar days; • Increase awareness of employment laws by conducting formal advocacy sessions at 2 conferences and 4 seminars in each year over the medium term.
Inspection and Enforcement Services, receives 18,1 per cent of the budget allocation.

Over the medium term, the Programme is expected to spend approximately R1,9 billion.

Over the 2021 medium term, Public Employment Services is expected to spend R1,8 billion.

The Programmes receives the 3rd largest budget.


Public Employment Services, has planned to provide public employment services by the end of 2021/22 by: • Registering 800 000 work seekers on the Employment Services of South Africa database; 9 55 • Providing employment counselling to 230 000 work seekers; • Filling 50 000 registered employment opportunities; • Registering 100 000 work opportunities on the Employment Services of South Africa database.
Further, contribute to increasing employment opportunities for people with disabilities by providing quarterly funding over the medium term, and monitoring disability organisations on an ongoing basis.
The Department will also play a more active role in facilitating job creation by establishing partnerships with stakeholders such as the Department of Higher Education and Training, the Department of Public Works and Infrastructure, Department of Small Business Development, the National Youth Development Agency, municipalities and the private sector.

In 2021/22 financial year, Supported Employment Enterprises (SEEs) is anticipated to receive R155 million.
Over the over the medium term it is expected to spend approximately R474 million apart from its own revenue.

The entity was established in 1943 as the Sheltered Employment Factories, for the sole purpose of creating employment for ex-serviceman and women who could not secure employment in the labour market due to barriers that prevented their participation.
The Department reported that the entity now has 13 factories located in 8 of the 9 provinces, with Mpumalanga Province currently being the only province without a factory.

The Employment Services Act 4 of 2014 now establishes the entity as the Supported Employment Enterprises to promote work and employment opportunities for persons with disabilities.
Currently the programme created a number of jobs through the presidential comprehensive youth employment intervention, currently employs just over 1 250 people with disabilities.
The factories can be found across the country and are located in industrial part outside major cities as follows: Kwa-Zulu Natal: Durban and Pietermaritzburg; Eastern Cape: East London and Port Elizabeth; Western Cape: N’dabeni and Epping; Northern Cape: Kimberley; Free State: Bloemfontein; North West: Potchefstroom; Limpopo: Seshego; Gauteng: Silverton (Pretoria) and Rand (Johannesburg) Springfield.
10 56 SEEs’ strategic intent is to generate over R200 million per annum by strengthening relationships and alliances with our existing key customers.

During 2020/21 financial year, it recorded 5 per cent annual increase of sales revenue from goods and services by the end of March 2021 have been achieved.

In 2021/22 financial, SEEs anticipate to record again the annual increase of 5 per cent sales revenue from goods and services.
By the end of March 2024, it is expected that sales revenue from goods and services will increase by 35 per cent.

It was reported that by the end of March 2025, SEEs will record an annual increase of 40 per cent in terms of sales revenue from goods and services.

The projected increase on income would require SEEs to establish a sustain customer agreements to generate a sustainable income to implement the mandate of the organisation.
The purpose of Programme 4; Labour and Industrial Relations is to facilitate the establishment of an equitable and sound labour relations environment.

Further, to support institutions of social dialogue and promote South Africa’s interests in international labour matters.

The Programme is also responsible of conducting research and analysis, and evaluate labour policy.

Provide statistical data on the labour market.


Some of the major departmental entities such as Commission for Conciliation, Mediation and Arbitration and National Economic Development and Labour Council fall under this programme.

Over the medium term, the Programme is expected to spend approximately R3,8 billion.

The Programme receives the largest budget allocation (35,9 per cent).
Over the medium term, Programme 4 is intending to: Improve monitoring mechanisms for the implementation of employment equity and compliance in the labour market by: • publishing the 2021/22 employment equity annual report and public register by the end of 2021/22; • publishing the code of good practice on the prevention and elimination of violence and harassment in the world of work by the end of 2021/22.
Further, to extend protection to vulnerable workers by publishing a national minimum wage for all sectors by the end of 2021/22.

In addition, to promote sound labour relations and centralised collective bargaining through the extension of collective agreements and 100 per cent registration of qualifying labour organisations by the end of 2021/22.
Further, to monitor and evaluate the impact of labour legislation to promote an evidence‐based labour policy 11 57 framework through the production of research and labour market trend reports by the end of 2021/22.

In terms of economic classification, over the medium term spending on compensation of the employees is expected to be approximately R4,1 billion.

Then spending on goods and services is anticipated to be approximately R2,1 billion.
Spending on transfers and subsidies is expected to be approximately R4,1 billion, largely distributed the department public entities such as CCMA, and NEDLAC.

6.

Issues Arising from Engagement 1.

The Committee raised concerns regarding budget cuts to Programme 2: Inspection and Enforcement Services and queried the extent to which the Department would be able to ensure compliance, particularly to vulnerable groups.

2.
2.

The Committee further raised concerns regarding the proposed abolishment of positions with regard to provincial branches, and further queried the extent the national department would be affected.

3.

Following a report by the Special Investigating Unit, key officials within the Unemployment Insurance Fund (UIF) were suspended, it has come to light that these officials have since returned to work and the Committee queried what disciplinary action had been taken against these officials.

4.
4.

In response to queries relating to the return to work of suspended UIF executives, the Department reported that when the SIU commenced its investigation the officials were placed on precautionary suspension.

Following conclusion of the first part of the SIU investigation, certain officials were allowed to return to work on the basis that the suspension was precautionary pending the outcome of the investigation.
It was determined that there was no wrongdoing on the part of the Chief Financial Officer and the Chief Operating Officer of the UIF.

5.

The matter involving the disciplinary hearing of the Commissioner of the UIF has not been finalised.

6.

The Department was urged to facilitate for labour market and stable industrial relations to promote economic growth.

12 58 7.
12 58 7.

In response to queries relating to the vulnerability and financial sustainability of the UIF, the Department reported that should the UIF COVID-19 Ters Benefit Payments continue the UIF will have no funds to run its operations and meet legislative requirements.

The situation is being monitored to determine whether the fund would be able to pay the UIF COVID-19 Ters Benefit Payments beyond the 15 March 2021.
It was further indicated by the Department that the financial position of the UIF is further constrained as a result of reduced revenue as a result of the COVID-19 pandemic.

8.

The Department indicated that following the disclaimer in audit opinion of the Compensation Fund by the Auditor General of South Africa (AGSA), the Minister would be instituting a forensic investigation.

Further, the Department would review key issues identified by the AGSA in addressing the audit outcome challenges.

9.
9.

The Department reported that following the COVID-19 pandemic, budget cuts and in the interest of protecting its employees, the Commission for Conciliation Mediation and Arbitration (CCMA) has adapted its business model and has automated a number of processes.

Whilst the Department is cognisant that this will alienate a number of clients, measures have been put in place where the office space of the Department can be utilised.
This adaptation in doing business will ensure that key functions of the CCMA are retained and targets are not reduced due to budget cuts.

Should additional funding be required the Department will consult with National Treasury for additional funding.

10.
10.

In response to queries regarding work being done to address youth unemployment, the Department reported that the National Pathway Management Network as part of the Presidential Youth Employment Intervention, is being created for young work seekers to view and access learning and work opportunities.
This programme will ensure that youth receive a basic package of support and work readiness training and will be matched to employment and economic opportunities, both within in the public service and within the private sector 11.

The Department reported that it has partnership programme with the European Union (EU).
The programme involves Basic Education and Higher Education and Training working together in collaboration to assist job seekers to be provided with relevant information and skills to enter the Labour Market.

12.
12.

The Department’s role with regard to youth unemployment is assisting government in coordinating intervention across government through pathway management, and that 13 59 also include private sector initiatives to ensure that the programme makes meaningful impact, and also augment information provided by Stats SA.

7.

Findings 1.

COVID-19 has negatively affected the global and national economies.

Further, many jobs remain at risk.

2.


Unemployment, inequality and poverty are serious risks for the government.

Young people, and women including people with disabilities are the highest group at risk.

3.

Further it was quite clear that the job market was damaged during the lockdown.
Despite government’s fiscal, monetary and social relief measures undertaken to protect jobs and incomes, it appears that jobs will be lost, and the situation will deepen if economic recovery measures are not effectively implemented.

4.

In the short-term, it is critical for governments to support the development of skills that foster individuals’ resilience by meeting the demand from labour markets.
In order to support implementation of the Economic Reconstruction and Recovery Plan, government need to address pre-existing structural challenges.

Provisioning of adequate support to low-skilled and vulnerable workers through effective retraining and upskilling policies is essential.

5.

Work place employment outlook still favours white male.

Women are still lagging behind in terms of top and senior management positions.

6.
6.

Training and development would need to be integrated, and the job seekers programme should be scaled-up.

Young people, women and people with disabilities should be prioritised.

Greater focus on linking job-seekers programme with industries, including identifying regions that are fast recovery, and putting measures to regions that are under severe economic stress.

7.
7.

Committee was concerned about the implications of the budget cuts to the service delivery, particular to the core functional policy areas such as Inspection and Enforcement Services, Public Employment Services including Labour Policy and Industrial Relations.

For the record, these programmes constitute as the core policy 14 60 priority of the Department.

Over the medium term budget process, National Treasury should consider to restore the resources in these programmes.

8.
8.

Services of the Commission for Conciliation, Mediation and Arbitration (CCMA) would be highly needed.

Budget reduction to the CMMA will negatively affect industrial relations, and thus increase instability in labour market.

9.

As more companies lay-off workers, the demand for benefits from the UIF will increase.

That will put pressure to the fund to mitigate the effects of the downward fall of the economy and its impact on jobs and income of families.

10.
10.

Jobs Seekers employment initiative should be scaled-up.

Partnerships with industry players, SETAs, and higher education institutions should be prioritised.

11.

The Committee during the 2020 medium term budget process observed that government will need to act in partnership with the private sector, and labour movement to restore the economy, and create jobs.

12.
12.

The government’s Economic Reconstruction and Recovery Plan would require the department to play a more focused and essential role in coordinating efforts contributing to the creation of jobs.

13.

The implementation of the Temporary Employer/employee Relief Scheme (Ters), which was established as a key part of the government’s R500 billion economic and social relief package to help firms and workers affected by the lockdown, was flagged as the risk.
Mainly there was a lack of a resilient system to manage the rapid payment under the COVID-19 context.

The payment system was susceptible to fraud and corruption.

14.

Resource mobilisation and equitable deployment of resources remains a key challenge.

Across government, there is a need to enhance coordination and distribution of resources.

15.
15.

Any negative economic outcome has the potential to negatively affect UIF development programmes such as the Public Employment Programme designed for young people.

16.

High Impact Social Fund and the Project Development Partnership Fund (aim to support SMMEs) would need to be effectively and equitable allocated.

Partnership with development finance agencies should be enhanced.

15 61 17.
15 61 17.

COVID-19 has just disrupted the entire governance processes, and exposed weaknesses in many organisations both public and private.

18.

Further, there were delays experience in making payments to the beneficiaries.

19.

It is clear that development partnerships would need to be formed across government, and improve business and government relations.

In the main efforts should be geared in creating conducive environment for investment, economic growth and job creation.

20.
20.

Social partners need to improve engagement to improve labour market conditions.

8.

Recommendations 1.

Within the 2021 medium term, the Minister through the Department should fast track and finalise the development of the Employment Policy.

2.

The Minister working closely with National Treasury in partnership with the Department of Trade, Industry and Competition should work on a mechanism that would ensure that business operations of the SEEs are sustainable.
The Committee reiterated that over the medium term both National Treasury and the Minister, through the Department, should explore alternative funding and financing sources to support growth and expansion of the SEEs.

3.

The Minister with the support of the Department should over the 2021 medium term, prioritised Productivity South Africa.
Within the 2021 medium term, Productivity South Africa should develop a business model that would ensure that it becomes financial sustainable, and scale up its operations to support growth and sustainability of businesses.

4.

The Minister should engage National Treasury to allocate Earmarked Funds dedicated to support job seekers, and scale up employment creation programme working in an integrated manner with industry players and Post-Secondary Institutions.

Report to be considered.

16 62 2.


REPORT OF THE SELECT COMMITTEE ON TRADE AND INDUSTRY, ECONOMIC DEVELOPMENT, SMALL BUSINESS DEVELOPMENT, TOURISM, EMPLOYMENT AND LABOUR ON BUDGET VOTE 36: SMALL BUSINESS DEVELOPMENT, DATED 1 JUNE 2021 1.
Background The Select Committee on Trade and Industry, Economic Development, Small Business Development, Tourism, Employment and Labour, having considered Budget Vote 36: Small Business Development, together with the Departmental Annual Performance Plan, 2021/22 - 2023/24, tabled by the Minister of Small Business Development, in terms of the Public Finance Management Act of 1999 (PFMA), as well as the Money Bills Amendment Procedure and Related Matters Act, 2009, reports as follows: 2.
Committee Process The Select Committee on Trade and Industry, Economic Development, Small Business Development, Tourism, Employment and Labour was briefed by the Department of Small Business Development on Budget Vote 36 and including the Departmental Annual Performance Plan of 2021/22 – 2023/24 on 18 May 2021.

3.

Introduction The Committee considered the 2021/22 Annual Performance Plan and the Budget of Department on 18 May 2021.
Further, the Committee recognised that the Department’s expenditure plans were presented under constrained economic and health context as a result of the global health crisis.

The outcome of Statistics South Africa (STATSA) reports reflect that Small Medium and Micro Enterprises (SMME’s) including informal business sectors borne the brunt of the impact of the COVID-19 pandemic and resultant lockdown.
It was reported that in the year up to the first quarter of 2020, the number of SMMEs grew by 2.5 per cent year on year, from 2.55 1 63 million in 2019 Q1 to 2.61 million in 2020 Q1.

SMME employment declined by 4 per cent to 10.4 million.

Formal SMMEs shed many jobs, most during the first quarter of the year.

Informal SMMEs also shed jobs during the first quarter.
National Treasury reported that despite easing lockdown restrictions, by the third quarter of 2020 there were 1.7 million fewer jobs than in the same period in 2019.

Of the employed, 12 per cent of workers received no pay from their employers in the third quarter (from 17.6 per cent in the second quarter) of 2020.

Further, nearly one in five of the workers who did receive salaries, reported that their salaries were reduced.
The labour market effects stemming from COVID-19 are particularly severe for low-skilled workers in high-risk occupations, deepening existing inequalities across age, education, gender and race.

Within the COVID-19 pandemic context, tourism including aviation, hospitality, and retail industries were the most affected industries.

The tourism industry need extra support taking into account its employment creation component.
This industry has been identified as a strategic industry in the Economic Reconstruction and Recovery Plan (ERRP) given its ability to absorb employment at various skill levels with the value chain.

The Department reported that despite the challenges posed by the COVID-19 pandemic, third and fourth quarter reports reflect emerging economic growth further enabled by the implementation of the Economic Reconstruction and Recovery Plan.
The ERRP has five objectives, which are linked to the country’s vision, set out in the National Development Plan (NDP Vision 2030): • To create jobs, primarily through aggressive infrastructure, investment and mass employment programmes; • To re-industrialise the economy, focussing on growing small business; • To accelerate economic reforms to unlock investment and growth; • To fight crime and corruption, and • To improve the capability of the State.
Over the medium term, the Department has committed to implement the following policy areas in response to the ERRP: • Localisation through industrialisation; 2 64 • Supporting sustainability and competitiveness of SMME’s and cooperatives; • Strengthening the informal sector to forge for a compact of radical economic transformation that advances the economic position of women, youth and persons with disabilities; • Making townships, villages and rural areas vibrant centres of economic activity.
As indicated in the 2021 Budget Review, the COVID-19 pandemic would have an impact to the Medium-Term Strategic Framework including the National Development Plan 2030.

It is already recognised in the public that the national budget is strained, and that would have an effect to the departmental spending priorities.

COVID-19 would certain have an effect to the operations of the Department.

4.
4.

Overview of the Legislative and Policy Mandate of the Department The aim of the Department is to promote the development of small business and cooperatives that contribute to inclusive economic growth.

The Department is mandated with the responsibility of leading and coordinating an integrated approach to the promotion of development of entrepreneurship, small business and cooperatives and ensuring an enabling legislative and policy environment to support their growth and sustainability.
Apart from the 1996 Constitution, the following pieces of legislation underpins the work of the Department: • National Small Enterprise Act (1996); • Public Finance Management Act, 1999 (No.

1 of 1999), as amended; • Preferential Procurement Policy Framework Act, 2000 (No.

5 of 2000), as amended; • Financial Advisory and Intermediary Services Act, 2002 (No.37 of 2002), as amended.

• Broad-Based Black Economic Empowerment Act, 2003 (No.

53 of 2003), as amended.


• National Small Business Amendment Act (2004); • National Credit Act, 2005 (No.

34 of 2005), as amended.

• Companies Act, 2008 (No.

71 of 2008), as amended; • Consumer Protection Act, 2008 (No.

68 of 2008), as amended; • Section 3(d) of the Industrial Development Corporation Act (1940); • Cooperatives Amendment Act 2013; 3 65 • Protection of Personal Information Act, 2013 (No.
4 of 2013), as amended; • Integrated Strategy on the Promotion of Entrepreneurship and Small Enterprises (2005); • Integrated Strategy on the Development and Promotion of Cooperatives (2012); and • National Informal Business Upliftment Strategy (NIBUS) and Implementation Framework (2014 and 2015).

In response to the Country’s commitment to multi-lateral and international commitments.
The Department’s work over the 2021 medium will also be aligned to the following legislative and policy areas: • The UN Sustainable Development Goals (SDG) (2015); • The AU Africa 2063 Agenda (AU 2063); • The International Labour Organisation (ILO) Recommendation 193 (R193) (2002); • The ILO Resolution 204 (R204) (2015); • African Continental Free Trade Area Agreement; and • Human Rights Implications of COVID-19 suggested by the UN and adapted to the South African Context.

5.
Budget Policy Area Guided by the NDP and the ERRP, including the MTSF the Department over the medium term, will focus on the following: • Providing support to small, medium and micro enterprises; • Providing greater access to finance for start-ups; • Finalising amendments to the National Small Enterprise Act (1996); • Developing master plans for meaningful integration of small businesses into the mainstream economy; and • Intensifying the establishment of infrastructure to expose SMME’s and cooperatives to new markets.
Over the medium term, the work of the of the Department is framed around key focus areas namely; support small businesses including Cooperatives, support and promote procurement of local products.

Further, to support and promote youth economic empowerment, women 4 66 owned small businesses including persons with physical disabilities.
The Committee in various interaction with departments that it plays an oversight role has emphasised that people with physical disabilities (including women and youth) are more exposed to high risk of poverty and unemployment including access to business opportunities than for people without disabilities.

There is a need for government to accelerate implementation of development programmes that will integrate people with physical disabilities to the mainstream economy.
5.1 Spending Over 2021 Medium Term Over the medium term, the Department is anticipated to spend approximately R7,6 billion in order to realise government policy priorities.

Transfers and subsidies account for 91 per cent (R6.9 billion) of the Department’s budget, whilst 5.8 per cent (R99.8 million) is allocated for compensation of employees and 3.2 per cent (R16.3 million) allocated for goods and services.
It is essential before we outline the spending outlook for the Department 2021 medium term to state that a healthy small business sector is a prerequisite for a growing economy with high employment opportunities.

Given the current government fiscal situation, partnership with the private sector including civil society would be pivotal for the successful implementation of the NDP and Economic Reconstruction and Recovery Plan.
Private sector resources would need to be leveraged by the Department to fully meet the policy priorities.

The Committee reiterated that better engagement by the development partners to enhance business environment for the benefit of SMMEs and Cooperatives, remains essential.
The core functional policy priorities of the Department are constituted around crucial functional policy areas namely; Programme 3: Development Finance, Programme 4: Enterprise Development; and Programme 2: Sector and Market Development.

Including Programme 1: Administration, which is expected to provide overall core administrative support to enable the three core functional policy programmes to realise their legislative and policy requirements.
Programme 1: Administration purpose is to provide strategic leadership, management and support services to the Department.

The sub-programmes under Programme 1 include: Ministry; Departmental Management, Corporate Management and Financial Management.

5 67 The Department, over the medium term period, through its support programme, will undertake various initiatives to strengthen governance and compliance.
Programme 1 has an allocation of R356.6 million over the medium-term with four sub-programmes: Ministry has R84.7 million, Departmental Management has R95.2 million, Corporate Management has R121.3 million and Financial Management has R55 million.
Targets such as an unqualified audit opinion; payment of creditors within 25 days; less than 5 per cent variance on annual budget; less than 10 per cent vacancy rate in funded permanent posts; a greater than an equal to 50 per cent of women in senior management service (SMS) employed; 3.2 per cent persons with disabilities employed with the intent of achieving 7 per cent representation at the end of the medium strategic framework period all expected to contribute towards improving the performance of the Department governance and compliance as well as the impact of its interventions.
The Ethics Management Policy and Ethics Management Strategy will be implemented to instil a culture of ethical conduct and assure the Accounting Officer that the operations of the Department are in line with ethical standards.
This will ensure effective management of ethics related functions such as disclosure of financial interests, conducting remunerative work outside the public service; disclosure of gifts and donations and consequently, reduce the prevalence of fraud and corruption within the Department.

Table 1 further indicates that Programme 2: Sector and Market Development, is expected to receive the 3rd largest budget allocation (4,8 per cent).
R417.6 million over the medium-term has been allocated to the programme, and split over four sub-programmes: Sector and Market Development Management has R6.8 million, Business Intelligence and Knowledge Management has R80.2 million, Ease of Doing Business has R23.4 million and Access to Market Support has R307.2 million.

The Programme is responsible to facilitate and increase access to markets for SMMEs through business information, product development support and value chain integration.
Over the medium term, the Programme has planned: 6 68 • Provide evidence‐based business information to direct sector thought leadership.

• Reduce the administrative and regulatory burden of doing business for SMMEs.

• Provide domestic and international market support services to SMMEs.

• Support the entry and growth of SMMEs in prioritised and designated sectors of the economy.

Access to markets is at the core of the establishment of growth of any enterprise.
The growth of market access to SMME’s increases revenue, improve job creation and results in greater growth and expansion.

The Department reported that it will intensify its efforts in working towards realising its medium term outcome to increase participation of SMME’s and Cooperatives in domestic and international markets.

During the 2020/21 financial year, Cabinet approved the SMME Focussed Localisation Policy Framework and Implementation Programme.
This approval gave way for various programmes to be launched, starting with the Manufacturing Support Scheme, which focusses on funding SMME’s linked to the market to increase their capacity and improve their competitiveness.

The Department further plans to update its measuring tool in the form of an Index to provide for an accurate information and data on the state of small businesses and cooperatives in the country.
This tool assist in measuring the performance and advocating for the design of interventions that are impactful to the growth and sustainability of SMME’s and cooperatives and enable their competitiveness as outlined in the NDP.

Through SEDA, the programme will increase the number of incubation centres/ digital hubs to 100 over the medium term period.
To ensure that the programme is supported, during the 2021/22 financial year, the Department will ensure that the Incubation Support Programme is evaluated and areas of underperformance are evaluated and addressed.

Over the medium term, an estimated R248.1 million is allocated to the Sector and Market Development programme.

The Department intends to intensify its establishment of infrastructure to expose SMMEs and Cooperatives to new markets.
This infrastructure is aimed 7 69 specifically at providing affordable, safe and modernised spaces where small enterprises can meet potential buyers.

Over the medium term, Programme 3: Development Finance, receive the bulk of the budget.

The Programme is expected to manage the creation of enabling financial support structures for SMMEs and the coordination of SMME funding across government.
Further, to manage the design of blended financial support initiatives for SMMEs, and to provide business assurance strategies for SMMEs.

In terms of budget allocation, the Programme would receive 54,5 per cent (see table 1).

The blended finance model that entails de-risking enterprises traditionally not supported by commercial banks and existing development finance institutions.

This is a done through matching a loan facility to a grant, which is allocated R882.1 million over the medium term.
During the medium term period, the programme will ensure that SMME and Cooperatives Funding Policy is approved and implemented to promote broader participation in the mainstream economy by small business.

This will be done by prioritising enterprises owned by women, youth persons with disabilities that operate in under-served areas such as townships and villages.
The Department provides direct and indirect support to SMME’s and cooperatives through its agencies, Small Enterprise Finance Agency (SEFA) and Small Enterprise Development Agency (SEDA) and internal support programmes such as the Co-operatives Development Support Programme (CDSP), Craft Customised Sector Programme (CSP), Township and Rural Enterprise Entrepreneurial Programme (TREP), the Business Viability Programme (BVP), the Small Enterprise Manufacturing Support Programme (SEMSP) and the Youth Start Up Support Programme (YSSP).
In 2021/22 financial year, the Small Enterprise Development Agency is expected to spend R867.791 million.
In terms of provincial allocation, SEDA is anticipated to spend approximately R47 million in Eastern Cape Province; R42 million in Free State Province; R34 million in Gauteng Province; R60 million in KwaZulu Natal Province; R39 million in Mpumalanga Province; R43 million in Limpopo Province; R39 million in Mpumalanga; R40 million in Northern Cape Province; R41 million in North West Province and R57 million in Western Cape Province.
8 70 Over the medium term, the Department through Programme 3: Development Finance will ensure that effort is intensified to support 85 000 competitive SMME’s and co-operatives to access financial and non-financial support.

The Township and Rural Entrepreneurial Programme aims to support enterprises based in marginalised areas.
During the 2021/22 financial year, the Department will provide financial support to the township and rural based entrepreneurs with emphasis on enterprises owned and managed by vulnerable groups.

This financial support is valued at R694 million, and is focussed on increasing capacity to access to economic opportunities and enhance their competitiveness.
Over the medium term, support to SMMEs would be provided through an allocation of R2.6 billion to the Small Enterprise Development Agency to coordinate and support nationally, and allocation of R510.3 million for internally administered incentives.

Access to finance, particularly for the first three stages of business life cycle is crucial for business sustainability.
To this end the Department will continue rolling out the Township Entrepreneurship Fund, which is implemented through the Small Enterprise Finance Agency (SEFA) at an estimated cost of R2.9 billion.

Deliberate interventions will be implemented to support start-ups, particularly those owned by vulnerable groups.
The Department’s business delivery model aims to streamline the processes and strengthen support in delivery of services and in particular, closing gaps in critical areas such as Development Finance.

Over the medium term, Programme 4: Enterprise Development is anticipated to drive the transformation of the economy through the creation of a conducive business environment for township, village and rural economies (includes informal businesses).
Further, to advance the competitiveness of SMMEs through an integrated approach, such as implementing the district development model.

In addition, drive the transformation of the economy through the formulation of policy instruments and advocacy work aimed at the inclusion of SMMEs in the mainstream economy.
Over the medium term, R2.742 billion is expected to be spent by the Enterprise Development, and it is split over 3 sub-programmes; Enterprise Development Management has R6.6 million, Enterprise and Supplier Development has R2.690 billion, and SMME Competitiveness has 9 71 R45.5 million.

In terms of budget allocation, the Programme 4 would receive 36,2 per cent.

That is the second largest allocation.


Through implementation of this programme the Department seeks to reduce the regulatory burden and create a conducive policy and legislative environment for SMME’s and cooperatives.

During the 2021/22 financial year, the Programme will ensure that the National Small Enterprise Amendment Bill is tabled in Parliament.
The Department has allocated R27 million over the medium term to the Enterprise Development programme to finalise amendments to the National Small Enterprise Act (1996).

It was reported that the amendments are aimed at dealing with the establishment of amendments to the small enterprise ombud service, regulating/licensing businesses owned by foreign nationals, unfair business practices and reviewing the definition of SMME’s to ensure a use of single and inclusive definition.
The Department will further embark on the revision of the Schedule to the National Small Enterprise Act.

To ensure the development of an enabling policy, legal and regulatory environment for small enterprise.

Further, the Department reported that it will submit the National Small Enterprise Development Masterplan to Cabinet for approval.
It was further reported that the Masterplan will ensure the delivery of an integrated, targeted and effective support interventions aimed at promoting entrepreneurship as well as providing financial and non-financial support to qualifying small enterprise and mainstreaming gender empowerment and the development of youth and persons with disabilities.
Further, the Masterplan will stipulate the measures that will be taken to execute the Graduation Model from informal business to competitive, sustainable and growing small enterprises that will contribute meaningfully to the Gross Domestic Product (GDP) of the country, job creation and inclusive growth.

Municipalities play a significant role in creating a conducive environment for new enterprises and the growth of existing ones.
To this end, the Red-Tape Reduction Programme addresses issues of reducing red tape.

This will commence with the Red Tape Reduction Pilot Administrative Simplification Programme in three provinces for SMME’s and cooperatives.
10 72 Table 1: Summary of the Departmental Spending for the 2021 Medium Term Expenditure Framework Programme R million Administration Sector and Market Development Development Finance Enteprise Development Total Average growth rate (%) Average: Expenditure/ Total (%) 2017/18 - 2020/21 -8.0% 46.9% 5.6% 3.3% Revised estimate 2020/21 94.7 57.0 Medium-term expenditure estimate 2021/22 116.3 138.8 2022/23 120.7 138.8 2023/24 119.6 140.0 Average growth rate (%) Average: Expenditure/ Total (%) 2020/21 - 2023/24 8.1% 34.9% 4.5% 4.8% 1 271.2 128.3% 41.8% 1 380.8 1 384.3 1 386.5 2.9% 54.5% 854.9 -11.4% 49.3% 902.4 916.6 923.8 2.6% 36.2% 2 277.8 15.6% 100.0% 2 538.3 2 560.3 2 569.9 4.1% 100.0% Change to 2020 Budget estimate (129.0) – – – Economic classification Current payments Compensation of employees Goods and services Transfers and subsidies Departmental agencies and accounts Public corporations and private enterprises Payments for capital assets Machinery and equipment Total 196.1 -1.3% 10.9% 150.7 4.4% 45.4 - -8.7% 0.3% -8.7% 0.2% 4.5 4.5 4.7 4.7 4.9 4.9 5.4% 0.2% 5.4% 0.2% 2 277.8 15.6% 100.0% 2 538.3 2 560.3 2 569.9 4.1% 100.0% Source: Estimates of National Expenditure, National Treasury As indicated in this report, the current fiscal situation has a direct effect to the departmental expenditure plans.
The Department submitted that over the 2021 medium term it needed R10.5 billion to support SMMEs, and in R5.2 billion for the 2021/22 financial year.

However, the final budget allocation was R2,5 billion for 2021 financial year, and R7,6 billion over the 2021 medium term.

In terms of economic composition, the Department is expected to spend R473.425 million over the medium term.
The Department reported that the organisational structure remains largely inadequate to meet SMME’s and cooperatives requirements.

The current structure is funded at 210 posts, with compensation to employees allocated R152.4 million in the current financial 11 73 year.

However, an additional 88 posts (costed at R58 million) is needed to enable the Department to fully meet its legislative and policy mandate.
The current department’s expenditure in relation to the Compensation of Employees is aligned to the broader government commitment to reduce the “wage bill”.

The 2021 Budget, as presented by the Minister of Finance proposed compensation reductions totalling R160.2 billion for 2020/21 to 2022/23, relative to the pre-Budget baseline.

The 2021 MTBPS proposed further downward adjustments to compensation, amounting to R143.2 billion for 2021/22 to 2023/24.
The Department reported that the reduction of the compensation of employees’ expenditure item, would have the following implications: • The Department will have challenges to have the required Human Resources to optimal operate.
The current organisational structure has 219 posts (inclusive of contract employees who have to be included in the permanent structure), with the budget cut indicated to be R137 million at the end of the MTSF, implying that 18 posts should be abolished as to match the “available budget.” • This means that the current recruitment process that includes the filling of the Deputy Directors-General posts will be negatively affected by non-availability of budget.
In terms of goods and services expenditure item, the Department reported that the budget has been reduced by R8.9 million for the 2021/22 financial year and R40.7 million over the MTEF period.

As a result, over the 2021 medium term, the Department is anticipated to spend R236.49 million.

6.

Issues Arising from Engagement 1.

The Committee noted improvements relating to the expenditure plans of the Department.
Further, the Committee had an appreciation of the context in which the expenditure plans were presented.

Given the current fiscal situation a balance in terms of spending with regard to compensation of employees and goods and services should be found taking into account the business operational requirements.

2.
2.

Further, the Committee welcome the efforts of the Department to align the organisational structure with the departmental policy strategy, and the alignment of the alignment of the budget to the organisational structure.

12 74 3.

The APP prioritised three provinces in respect of the Red Tape Reduction Pilot Administrative Simplification Programme.

Members urged that the Department needed to fast-track the extension of this programme to other provinces, particularly to rural areas and townships.
Furthermore, Members queried the partnership of municipalities and coordination of the district development model in this regard.

4.

The Department was urged to provide the Committee with a report on the success and failure rate of Departmental programmes within provinces.

5.

It was highlighted that many SMMEs find it difficult to operate due various regulatory inhibitors across the spheres of government.
In terms of ‘ease of doing business’, it was raised by Members that there is a lot that needs to be done.

The Department submitted that surveys conducted in 2020 reflected that vulnerable groups especially do not feel that government is doing sufficient to support them.

In it’s 2021/22 APP, the Department is in the process of developing an SMME Index.
The SMME Index will be made available to other government departments and municipalities to be able to improve their expenditure plans including procurement databases.

6.

In response to queries from Members regarding the criteria used for SMME Export Development Programme, the Department submitted that it was working closely with the Department of Trade, Industry and Competition, and leveraging its export development support and training programme.
The criteria used to determine eligibility for the SMME Export Development Programme include the following, namely: • Registration with the South African Revenue Services (SARS) and Companies and Intellectual Properties Commission (CIPC) • Proven ability to successfully supply the domestic market • Sufficient production capacity to supply both domestic and international markets • Must have been operating for a minimum of 18 months 7.
The Department reported that the NDP has a target of the job creation of 11 million jobs of which 90 per cent must come from SMMEs and Cooperatives.

The Department indicated that it is working towards the creation of mechanisms to track the performance of SMMEs and Cooperatives in the various industries of the economy such as agro- processing, tourism and manufacturing.
Further, the Department submitted that it is also working closely with Statistics South Africa (StatsSA) to ensure that SMMEs and Cooperative’s performance is properly tracked and reported.

13 75 8.

In terms of coordination of support to SMMEs and Cooperatives with municipalities, the Department noted that the Local Economic Development units in some cases in many municipalities lack capacity and capability.

Engagements between the Department and district and local municipalities are ongoing.
The Department will be working more closely with the Department of Cooperative Governance and Traditional Affairs to ensure that SMME and Cooperative development support gains more traction at municipal level.

Coordination with municipalities will facilitate quick turnaround times in the registration of new businesses, uniformity of interventions and ensure that resources are spread.

9.
9.

The Department further indicated that in alignment with the District Development Model, it has developed a SMME Support Plan which clearly indicates how many small enterprises should be supported per District to support efforts to achieve an inclusive economic growth that addresses spatial disparities.

This plan will be implemented in partnership with various departments, provinces and municipalities.
The plan would also enable the Department to plan better on how and where resources should be distributed in a way that redresses the imbalances of the past.

The initiative would attempt to shift resources from urban areas to scale development in the township and rural areas.

The support will be in the form of business development support as well as economic infrastructure support which includes incubation/digital hubs as well as contributing to the growth and sustain development industrial parks.

10.
10.

The Department submitted that through the Small Enterprise Finance Agency (SEFA), the SMME COVID Debt Relief Finance Scheme and SMME Business Growth Resilience Facility were facilities created to assist SMMEs, which were negatively affected by COVID hard lockdown.

The assistance provided covered operation’s requirements of SMMEs, which included costs such as rental fees and salaries.
The criterion for these facilities did not look at the age of the enterprise however sought to look at the future potential of the business.

11.

In relation to coordination with the Department of Trade, Industry and Competition (DTIC) in respect of digital hubs, the Department reported that this was taking place at the Botshabelo Digital Hub wherein the Department provided a budget to SEDA to set up a digital hub in the industrial park.
However, it should be noted that DTIC is not involved in all digital hub initiatives of the Department.

SEDA plays a pivotal role in the establishment digital hubs.

14 76 12.

In response to queries relating the SMME Masterplan, the Department submitted that it has various sector champions that would support the implementation of the master plan.

The aim is to integrate SMMEs into various industries in economy.
Further, the Department submitted that it is leading in the development of the master plan that would cover the creative economy, working closer with the Department of Sports, Arts and Culture.

This is the area that government has identified as a strategic industry to create employment opportunities.

13.

The Department noted the essential role of development finance institutions, particular at a time where many SMMEs and Cooperatives need funding and financing.
Commercial banks are much more risk averse.

Further, the current economic and health crisis has made many commercial banks to tightened lending streams to SMMEs.

The slow performance of the R200 billion Loan Guaranteed Scheme is one of the indicators that SMMEs and Cooperative find it difficult to access finance.

The Department hopes that the SMME Funding Policy Framework would tackle the challenge faced by SMMEs and Cooperative in accessing finance.
The Department reported that it is working with National Treasury and industry role players to come up with sound funding policy strategy.

The funding policy strategy would also cover financial literacy to support SMMEs and Cooperative to improved financial management.

14.

The Department submitted that the Business Viability Programme is aimed at supporting SMME s and Co-operatives to overcome both financial and non-financial constraints that negatively affect business activities.
The primary purpose of the Programme is to ensure that SMMEs and Co-operatives are commercially and financially viable and contribute meaningfully to economic transformation and job creation.

Some of the interventions will include business turnaround interventions including business rescue for those businesses, which have demonstrated that their business models are stronger to survive in the new normal.
A total of 15 000 businesses will be supported in the 2020/21 financial year and 70 000 competitive businesses will be supported over the medium term.

7.

Findings 1.

South African SMMEs, already are experiencing an effect of a contracting economy, additional shocks from COVID-19 are putting further pressure on their operations.

15 77 2.

Lower investment and business confidence remains a red flag.

Both are indicators that shows lower revenue and profitability of SMMEs.

3.
3.

Many SMMEs lack the financial, operational, and strategic structures that are common in larger businesses.

Mostly, are affected with lack of liquidity and cash-flow management.

4.

A 2018 study from the Small Business Institute (SBI) reveals that 98.5 per cent of formal businesses in SA fall into the category of small and medium and micro- enterprises (SMMEs).

However due to COVID-19, the picture is terrible.

It is estimated that our economy will lose as many as 55,000 small businesses.

5.
5.

Sme.africa and Sasfin survey of around 1,000 SMEs, indicated that around 60 percent of SMEs may close before the crisis is over.

Further, reports indicate that many small businesses have expressed that programmes offered by the Department do not adequately addressed their challenges.

6.

The Department is not using sufficiently the SMME ecosystem to generate distribution model for the development funds-Partnership with private sector, and NPOs within the SMME sector.

7.
7.

Insufficient communication of the available funds to intended beneficiaries.

8.

There is a need to improve coordination with provincial and local government in implementing programmes designed to support SMMEs.

9.

The issue that has been raised by businesses and rural communities is the lack of impact of programmes and products designed to support SMMEs, particular those in peri-urban and rural areas.

10.
10.

According to the 2018, National Treasury Report titled “State of Procurement Spent in National and Provincial Departments”, SMMEs still receive much less of the government procurement.

This could be the picture that is also experienced by small enterprises with regard to the private sector procurement.

11.

Poor performance of the R200 billion Loan Guaranteed Scheme in relation to the financing of SMMEs.
Lack of uptake of the assistance loans shows greater systematic problem over the access to financing of SMMEs (including Cooperatives) in the country.

12.

2018 Report titled “An assessment of South Africa’s SME landscape”, by SME South Africa revealed that only 6 percent of SMEs surveyed received government funding and only 9 percent had sourced funding from private sources.

16 78 13.
16 78 13.

Further, the 2020 by SAVCA “Impact of Venture Capital & Private Equity in South Africa” reported that the majority of private equity funding has largely been focused on mature businesses with around 90 percent of funding going to businesses that are more than five years old.

14.

Low awareness of opportunities and a lack of financial knowledge still remain major barriers to SMMEs accessing financing.

15.
15.

Centre for Development Enterprise (CDE) points that exclusionary eligibility for funding qualification criteria, lack of accurate information, and time lags between application and disbursement of funding has a negative impact to the functioning of SMMEs.

16.

Concentration of funding in high growth provinces such as Gauteng, Western Cape at the expense of predominant rural provinces.

That shows inequity in distribution of resources in terms of support given to SMMEs.

17.
17.

Application process has the potential to raise red-tape as an inhibitor; Further reports indicate 54 per cent of SMME owners have not completed secondary schooling in South Africa.

18.

Identify opportunities to reduce regulations for SMMEs and more generally ensure that regulations are appropriate to the size of operations, case in point spaza shops.

Further, there is a need to simplify application rules.

19.
19.

The Report of the Financial and Fiscal Commission flagged the utilisation of financial intermediaries (wholesale lending) as one of the cost drivers that increasing the cost of capital for struggling small enterprises.

20.

To the lack of data about the number of SMMEs, including spaza shops, that affect planning.

Planning, seems to be not adequate.

21.

Export support programme needs to be improved.

Partnership with Department of Trade, Industry, and Competition should be prioritised.
The Department should leverage financial institutions both public and private sector to enhance growth of SMMEs and Cooperatives.

22.

Impact of COVID-19 would need many businesses to be supported to implement digital commercial platforms.

So digital adoption and an advice culture would certainly need fiscal support.

This support should also reach SMMEs and Cooperatives across the country.

23.
23.

Government in partnership with the private sector should establish an export initiative (including establishing an export office to support SMMEs).

17 79 24.

Support for innovation should be improved, and enhanced.

The Department should work closer with higher education institutions including entities operating in science and technology both in the public and private sector.

Investment in innovation, research and development should be prioritised.

25.
25.

McKinsey reports that the Malaysia’s national commercialization platform— PlaTCOM Ventures—helps entrepreneurs turn their ideas into successful products and services.

In South Africa, support of high growth-tech companies should be accelerated.

Partnership with private sector and industry players in science and technology remains a challenge.

26.

Further, the Department should work in a strategic way to improve supplier development programmes that big corporates offer to SMMEs.
Supplier development programmes should be much more than social responsibility programme.

Must extend to the sustainability of SMMEs.

27.

Organisational health and capability should be one of the key priorities that the Department should prioritise.

28.

There is a need over the 2021 medium term period for the Department to fill critical posts in order to realise government, and departmental policy outcomes.
This should form part of the broader re-engineering of the Department, and to repurpose the Department to meet the needs of the small enterprise industry.

29.

Over the 2021 medium term, the Department must fast track the process of merging SEFA, SEDA and NEF to form a focused, single and coherent SMME Development Agency.

The merger process of SEDA, SEFA and NEF should be prioritised.

8.
8.

Recommendations 1 The Minister of should continue to engage the Minister of Finance to consider allocating additional resources over the 2021 medium term to the Department to scale-up policy response geared at stimulating the growth and expansion of SMMEs and Cooperatives.

The resource allocation should also consider the need of the Department to fill core critical positions.

Further, the Committee also encourages the Department to exploit human resources residing within its development agencies.
2 The Minister should fast track the finalisation of SMME Funding Policy Framework.

By the end of the 2021 financial year the Minister is urged to submit SMME Funding Policy 18 80 Framework.

The role of other spheres of government, development finance institutions and private players such as commercial banks should be clear articulated.

Therefore, their involvement in development of the funding policy is essential.
3 As indicated in the Departmental expenditure plans, by the end of the current financial year, Minister through the Department need finalise and submit the Small Enterprise Master Plan including the Small Enterprise Amendment Bill.

4 The organisational structure is critical in determining the organisational health and capability pf the Department to meet policy priorities.

In preparation of the 2022 medium term, the Minister through the Department must finalise the macro-organisational structure.
5 Over the 2021 medium term, the Minister should finalise the process of merging SEFA, SEDA.

Working with the Minister of Trade, Industry and Competition, the merger should include the National Empowerment Fund to form a focused, single and coherent SMME Development Agency.

The merger process of SEDA, SEFA and NEF should be prioritised.

The Presidency and National Treasury should provide necessary resources to support the merger of the mentioned development entities.

Report to be considered.

19 81 3.


REPORT OF THE SELECT COMMITTEE ON TRANSPORT, PUBLIC SERVICE AND ADMINISTRATION, PUBLIC WORKS AND INFRASTRUCTURE ON THE 2021/2022 BUDGET VOTE 11: PUBLIC SERVICE AND ADMINISTRATION, DATE 2 JUNE 2021 1.
BACKGROUND The Select Committee on Transport, Public Service and Administration, Public Works and Infrastructure (hereinafter referred to as the Select Committee), having considered the directive of the National Council of Provinces to consider and report on the Strategic Plans, Annual Performance Plans and Budget allocations of the Department of Public Service and Administration, reports as follows: 2.
INTRODUCTION The Public Finance Management Act (1999) describes the Minister of Public Service and Administration as the executive authority of the department.

In this role, the Minister has the responsibility to provide leadership over how the DPSA and its entities should use the allocated budgetary and human resources to translate policy ideals into implementable programmes.
On 26 May 2021, the Committee considered presentation on the Strategic and Annual Performance Plans and budget allocation of the Department of Public Service and Administration.

This report summarises the presentations received from the Department of Public Service and Administration, focusing on the 2020/25 Strategic Plans and 2021/22 Annual Performance Plans and Budget as well as allocations over the medium-term.
This report summarises the presentations received from the Department of Public Service, Administration and Centre for Public Service Innovation, focusing on the 2020/25 Strategic Plans, 2021/22 Annual Performance Plans and the proposed budget over the medium-term.

3.
3.

OVERVIEW OF THE DEPARTMENT OF PUBLIC SERVICE AND ADMINISTRATION The Department of Public Service and Administration is expected to implement and coordinate interventions aimed at achieving an efficient, effective and development-oriented public service, which is an essential element of a capable and developmental state as envisioned in 1 82 the National Development Plan (NDP) 2030.
The Constitution of the Republic of South Africa envisages a Public Service that is professional, accountable and development-oriented.

The NDP identifies specific steps that need to be taken to promote the values and principles of public administration as enshrined in the Constitution.
Furthermore, the NDP highlights the need for a well-run and effectively coordinated state institutions with skilled public servants who are committed to the public good and capable of delivery consistently high-quality services, while prioritising the nation’s development objectives.

Unevenness in capacity that leads to uneven performance in the Public Service is also acknowledged in the NDP.
This is caused by a complex set of factors, including tensions in the political-administrative interface, instability of administrative leadership, skills deficits, insufficient attention to the role of the State in reproducing the skills it needs, the erosion of accountability and authority, poor organisational design and low staff morale.

Steps are needed to strengthen skills, enhance morale, clarify lines of accountability and build an ethos of public service.
These steps are guided by the need for long-term policy stability as well as awareness of potentially adverse effects of over-regulation.

The main objective of the Department is to put in place the mechanisms and structures that can support departments in developing their capacity and professional ethos.
The Public Administration Management Act (PAMA) 11 of 2014 was signed into law with an objective of establishing a uniform system of public administration to ensure that common norms and standards are achieved at all government levels.

This effectively places DPSA at the centre of ensuring that all operating platforms and units to drive a compliant ethical public service are guided by norms and standards.

2.
2.

LEGISLATIVE MANDATE The Department is mandated by section 195(1) of the Constitution, which sets out basic values and principles that the Public Service should adhere to and the Public Service Act (PSA) of 1994, as amended.

In terms of the PSA, the Minister for the Public Service and Administration is responsible for establishing norms and standards relating to: • The functions of the public service.
• Organisational structures and establishment of departments and other organisational and governance arrangements in the public service.

• Labour relations, conditions of service and other employment practices for employees.

2 83 • The Health and wellness of employees.


• Information management; • Electronic government in the public service; • Integrity, ethics, conduct and anti-corruption; and • Transformation, reform, innovation and any other matter to improve the effectiveness and efficiency of the public service and its service delivery to the public.

3.
3.

STRATEGIC PRIORITIES 2019/2024 The priorities for the Department of Public Service and Administration over the medium term period are informed by the National Development Plan objectives, which are therefore translated into the Medium Term Strategic Framework (MTSF) 2020-2025.
The Department highlighted the following priorities to the SelectCommittee: 3.1 Formulating and implementing the Public Administration Policy The Minister for the Public Service and Administration makes regulations within and for the entire public service.

The Department reported that there is an insufficient data and information on the implementation of most of the administrative policy areas, of the Public Service Act norms and standards.
Historically standards were not developed based on critical success factors of capacity and capability across the public service.

There is a need for an e-Enabled system for self-diagnostics and compliance audits through the measurement instruments of the Office of Standards and Compliance.
As a result, the Organisational Functionality Assessment Tool is being consolidated to measure institutional governance, as well as organizational administration 3.2 Regulating and improving Public Service Employment and Conditions of Service The State, as the employer, is going through difficult financial times and as a caring government, departments have to function within the available resources.
Failure to exercise financial prudence will result in government borrowing money from the external institutions to finance government work.

The State is cautious of borrowing to pay salaries at the expense of delivery.
In 2019 already, outlining the fiscal outlook during his Budget Speech, Finance Minister Tito Mboweni indicated that in 2018/19 the tax revenue would be R1.3 trillion and that spending would be about R1.5 trillion, leaving government with a budget deficit of R215 billion, or 4.3% of the gross domestic product.
3 84 Improving on Public Service Employment and Conditions of Service requires some restraint on the part of Government, but this restraint should not affect the multi-year agreement between Government and organised labour, which ended in March 2020.

To be seen as “good faith negotiator”, Government should honour the agreement and then negotiate for any other deal linked to the country’s economic outlook going forward.
To manoeuvre circumspectly in this area, Government needs to keep its word regarding the agreement already in place so that organised labour would be flexible in their approach concerning future collective bargaining.

Early Retirement in the Public Service should be decentralised as depicted in the Public Service Act.

This will ensure pertinent challenges arising from the applications are addressed by individual departments with understanding of the situations of staff.
This will enhance compliance and performance at the local level.

With respect to discipline management, the Department has noticed a high usage of legal representatives, contrary to the Disciplinary Code and Procedure.

Even though there has been an improvement on the average number of days taken to resolve disciplinary cases, departments are still delaying with the finalisation of disciplinary cases within the 90 days period.
However, they have suspensions that are longer than 60 days without holding disciplinary hearings.

Such delays are in contradiction of the disciplinary code, which is a cost to government coffers.

3.3 Improving Public Service Information, Communication and Technology (ICT) The Public Service continues to rely on brick and mortar as the main channel or mechanism (service delivery points) through which the citizens can access public services.
Furthermore, these service delivery centres operate within specified times of the day, referred to as office hours.

The two issues introduce a huge limitation or hindrance on how the citizens’ access and experience public services as they often have to travel long distances to where these service delivery points are located.

Importantly, they must do so within certain time limits or operating hours.
It is important to further highlight that public services are requested and delivered through dis-integrated manual processes that are largely paper based, which does not allow government to have an integrated view of how citizens had accessed public services delivery point.

4 85 With global trends clearly indicating that the public administration is mostly affected by Fourth Industrial Revolution (4IR) trends owing to the old and often outdated ways of thinking, work and policies.
The Department will be leading digital transformation of the public service.

Some of the key interventions in this regard will include developing the required prescripts to enable and support the digital transformation of the public administration.

This will ensure that government is a key economic enabler and player positively benefits from the digital economy.
3.4 Ensuring Service Delivery Improvement A number of evaluation reports and studies on government service delivery indicate that, despite the existence of an enabling environment through regulatory frameworks and support mechanisms, some government services such as sanitation, water, electricity and housing are still not equally accessible to all South Africans (especially in rural areas) and delivery is not offered at the desired level.
The persistent challenges that affect the service delivery value chain include, amongst others, poor and uncoordinated planning, spending of budgets allocated for delivery of services, lack of service standards, lack of technical skills, insufficient resources as well as lack of efficient and effective management of operations and frontline staff’s adherence to the provision of services in line with the Batho Pele principles.
Compliance on the submission and implementation of Service Delivery Improvement Plans (SDIPs) still remains a challenge.

Improvement in service delivery also requires adherence to the Batho Pele policy and the Public Service Charter, and strict monitoring thereof.
In addressing the gaps and weaknesses, the Department will over the MTEF period, institutionalise a number of integrated interventions which include, amongst others, the strengthening of the implementation of the Operations Management Framework and Service Delivery Improvement Plans as well as a revised Programme to strengthen the implementation of the Batho Pele Programme.
In line with Cabinet decisions, the DPSA will also during this MTSF, transfer the Community Development Workers and Thusong Service Centres Programme coordination and implementation functions to the Department of Co-operative Governance and Traditional Affairs (COGTA).

The DPSA will retain the policy development function as delegated to the Minister for Public Service and Administration.

5 86 4.
5 86 4.

STRATEGIC FOCUS FOR 2021/22 The strategic focus of the Department is based on the National Development Plan (NDP) 2030 and the Medium Term Strategic Framework (MTSF) 2020-2025.

In particular, the NDP envisions: Building a capable, ethical and developmental state.

The vision is for the country to move towards a developmental and transformed state that is capable, professional and responsive to the needs of its citizens.
This requires well-run and effectively coordinated state institutions with committed public servants that are skilled and capable of delivering consistently high quality services, while prioritising the country’s developmental objectives.

Promoting accountability and fighting corruption.

The vision is of a South Africa that has zero tolerance for corruption.
In 2030, South Africa will be a society in which citizens do not offer bribes and have the confidence and knowledge to hold public and private officials to account, and in which leaders hold themselves to high ethical standards and act with integrity.

Anti-corruption agencies should have the resources, independence from political influence, and powers to investigate corruption, and their investigations should be acted upon.
The MTSF 2020-2025 - states that Government must aim at “Ensuring a Capable and Developmental State”.

“Key attributes of a developmental state include a capable, autonomous meritocracy; political leadership oriented towards development; a close, often mutually beneficial, symbiotic relationship between some state agencies and key industrial capitalists; and successful policy interventions that promote growth.
Transforming South Africa into a Developmental State will require building critical and necessary capabilities to foster an environment, which mobilises government and non-government contributions to realise changes in the socio-economic structures and the culture of society.

This MTSF 2019-24 will prioritise the engagement between leadership of the executive, legislature and judiciary on strengthening governance and accountability.
It further commits the state to manage the political-administrative interface more effectively, reduce the levels of fraud and corruption in the private and public sectors, and rationalise the public service governance system.

5.
5.

STATE OF THE NATION ADDRESS (SONA 2021) The priorities highlighted were: 6 87 5.1 Fighting corruption to strengthen the State The Address highlighted overriding priorities of 2021, namely: • Defeating the coronavirus pandemic; • Accelerating economic recovery; • • Implementing economic reforms to create sustainable jobs and drive inclusive growth; In addition, fighting corruption and strengthening the State.
The Address further highlighted that Government “had started with the implementation of the National Anti-Corruption Strategy, which lays the basis for a comprehensive and integrated society-wide response to corruption.

Government is set to appoint “the members of the National Anti-Corruption Advisory Council, which is a multi-sectoral body that will oversee the initial implementation of the strategy and the establishment of an independent statutory anti-corruption body that reports to Parliament.
5.2 Building a capable State dependent on advancing honesty, ethics and integrity Building a capable State is still another area prioritised by Government.

In 2019, the President called on all public servants to serve South Africans with diligence and to adhere to the Batho Pele principles of putting the people first.
He further indicated that the capacity of the state will be built by actions including: • Firstly, strengthening the technical capacity in government to ensure that projects move faster, building a pool of engineers, project managers, spatial planners and quantity surveyors – an action team that can make things happen faster on the ground.
• Secondly, improving the capabilities of public servants through the introduction of a suite of compulsory courses by the National School of Government, covering areas like ethics and anticorruption, senior management and supply chain management, and deployment of managers to the coalface to strengthen service delivery.
5.3 Enhanced accountability through Ministerial Performance Agreements\ The President reported that in October 2020 he had signed off Ministerial Performance Agreements with the Executive in order to enhance accountability.

This is also not a new 7 88 phenomenon for the Executive.

Non-performance is usually addressed through reshuffling not with dismissals, but to shift the Member of the Executive to another portfolio.
However, Parliament is there to ensure accountability from the Executive, serving the checks and balances.

The nature of the questions asked by Parliament to the Executive will give a hint to the President concerning who is complying or not complying with society’s satisfaction levels through Parliament’s ability to ask probing, not biased questions.
5.4 Professionalism to inculcate public confidence The above are in line with the vision of the National Development Plan: Public service – Key medium-term goals for 2020 - sub-outcome 2, which stated that the public service must have sufficient technical and specialist professional skills.
It is also in line with the spirit and letter of the Medium Term Strategic Framework 2020-25, which states the following objectives for Priority 4: Strengthen Governance and Public Institutions: • Outcome: Improved governance and intergovernmental and engagement with citizens.

• Outcome: Honest and capable state with professional and meritocratic public servants.

• Outcome: Professional and ethical Public Service.

• Outcome: Developmental state and compact with citizens, responsiveness, public trust.
• Outcome: Strengthen relations and efficiency in government.

Skills deficits and insufficient attention to the role of the State in reproducing the skills it needs remain a challenge.
Monitoring and evaluation of the implementation of policies are important to ensure that “state institutions are well-run and effectively coordinated, run by professionals who are committed to the public good and capable of delivering consistently high-quality services, while prioritising economic growth and reduced poverty and inequality.
• Accordingly, the strategic focus of the Department for 2021/22 includes: Developing regulations to enable the full implementation of the Public Administration Management Act (PAMA, 2014).

• Reviewing the Public Service Act and related policies, where required, which will be done concurrently with the development of the Single Public Administration Bill.

8 89 • Improving implementation of administrative policies and enforcing compliance where required.
• Improving the implementation of the Batho Pele principles by ensuring that there are measurable standards in place.

• Stabilising the Public Service by restoring stability and credibility in state institutions.

• Fighting corruption by inculcating a culture of accountability, ethical and professional standards of all civil servants, as well as strengthening discipline management within the Public Service.
The strategic priorities of the Department align with the national strategic imperatives as outlined earlier on in the brief.

The implementation of these strategic priorities will put service delivery on a better level, and Parliament’s oversight can see these priorities effectively taken through.

6.
6.

BUDGET ANALYSIS The Department of Public Service and Administration’s overall budget allocation for 2021/22 is R526.2 million, compared to the adjusted allocation of R468.9 million after the advent of the COVID-19 pandemic in March 2020.

The Department’s budget is divided into five programmes, reduced from six programmes in 2020/21.
Programme 6: Governance of Public Administration, was discontinued, as the departmental transfers, namely the Public Service Commission (PSC) and the National School of Government (NSG), are currently fully-fledged budget Votes.

The main cost drivers of the Department are Programme 1: Administration (R237.3 million); followed by Programme 5: Government Service Access and Improvement (R104.8 million) and Programme 3: Negotiations, Labour Relations and Remuneration Management (R99.1 million).
Whilst Programme 4: E-Government Services and Information Management consumes the smallest portion of the Vote, it experiences the most significant growth of R61.75 per cent in real terms, this is because the programme had a lesser allocation in February 2020, and during the June 2020 readjustment due to the COVID-19 pandemic, the programme’s allocation was reduced further.

To, at least, make it relatively effective to its mandate, this level of increase is justified.
Priority Programme 3: Negotiations, Labour Relations and Remuneration 9 90 Management, also experiences significant real growth of 37.83 per cent.

This is due to the nature of negotiations on wage and conditions of service, which have a tendency to drag on and involve litigation.
Table 1: Main Appropriation 2021/22 Programme Budget R million 2020/21 Million 2021/2 2 Million Real Rand change Nomi nal Rand chang e 2021/22 Nominal % change Real % change 2021/22 2021/22 Programme Administration 1: 226,4 237,3 10,9 1,3 42,8 49,2 6,4 4,4 69,0 99,1 30,1 26,1 4,81 cent per 0,59 cent 14,95 cent per 10,32 cent per per 43,62 cent per 37,83 cent per 21,3 35,9 14,6 13,2 68,54 cent per 61,75 cent per 109,4 104,8 -4,6 -8,8 468,9 526,2 57,4 36,2 -4,20 cent per -8,07 cent per 12,2 cent per 7,72 percent Source: National Treasury (2021) 7.
PROGRAMME PERFORMANCE 7.1 Programme 1: Administration The main purpose of the Programme is to provide strategic leadership, management and support services to the Department, and coordinate the Department’s international relations.

The purpose of the Programme is to provide policy, coordinated strategic and overall administrative support services to enable the Ministry and the Department to deliver on mandates.
10 3: Programme 2: Human Resource Management and Development Programme Negotiations, Labour Relations and Remuneration Management Programme 4: E- Government Services and Information Management Programme Government Access Improvement TOTAL 5: Service and 91 The budget for Programme 1 increased from R226.4 million in June 2020/21 to R237.3 million in 2021/22.

This represents an upward revision of R10.9 million (4.81 per cent) in nominal terms.
However, when taking into account the effect of inflation, the allocation to the Programme only increases by 0.59 per cent.

The programme is the main cost driver under this Vote, consuming 45.09 per cent of the overall allocation.

The main cost drivers under this programme are the Corporate Services (at R96.3 million); Office Accommodation (at R54.4 million); Ministry (at R29.7 million); and Finance Administration (at R29.5 million) sub-programmes.
Prioritisation of the Budget in this manner is justified, as the Corporate Services sub-programme also includes the Centre for Public Service Innovation’s activities.

There is one Corporate Services for the Department, including established government components.
Also, the strategic focus of the Programme is “Improved implementation of administrative policies”, which includes (i) monitoring fruitless, wasteful and irregular expenditure; (ii) revising the Public Service Amendment Bill; (iii) consulting on the Public Administration Management Amendment Bill and (iv) implementing Public/Stakeholder Participatory Strategies and Plan.
of the APP submitted to the Executive Authority, National 7.2 Programme 2: Policy Development, Research and Analysis The main purpose of this Programme is to manage and oversee the setting and translation of public administration norms and standards into administrative policy instruments using research and policy analysis techniques.

It is also responsible for managing organisational functionality assessments of Public Service efficiency and effectiveness for public administration reform.
The budget allocation for Programme 2 increased from R42.8 million in June 2020 after adjustments caused by the advent of the COVID-19 pandemic, to R49.2 million in 2021/22.

This is an upward revision amounting to R6.4 million in nominal terms, and R4.4 million in real terms.

This programme consumes the second smallest portion (9.35 per cent) of the overall budget.
The bulk of the Programme’s budget (R15.3 million) is allocated to the Human Resource Planning, Employment and Performance Management sub-programme.

The Transformation and Workplace Environment Management sub-programme, at R10.8 million and the Office of Standards and Compliance at R10.0 million, follow with relatively bigger budgets.
11 92 The programme’s strategic focus is “A stabilised Public Service”, with strategic targets being to issue the legislative frameworks, provide technical advice and guidance to departments to support public service business continuity during the State of Disaster as a result of the COVID- 19 pandemic and develop an Occupational Dictionary.
The Department will further contribute to the development of the governance and state capacity/skills aspect of the joined-up plan within the identified districts/metros.

Moreover, the Department will issue legislative framework to institutionalise mandatory in-service training framework by the National School of Government.

The National Development Plan has deliberated on the challenge of unevenness of performance of government.
The Department will in this regard develop measures to improve the effectiveness and efficiency of government institutions.

7.3 Programme 3: Negotiations, Labour Relations and Remuneration Management Programme 3: Negotiations, Labour Relations and Remuneration Management was formerly known as Public Service Employment and Conditions of Service.
The function of the programme is to manage, oversee and facilitate organisational development, job grading, macro organisation, remuneration, human resource information systems, conditions of service, labour relations and dispute management in the public service.
It also administers the implementation of the Government Employees Housing Scheme and the macro organisation of the State, and ensures coordinated collective bargaining Programme 3 is allocated a budget to the value of R99.1 million, which increased from a previous allocation of R69.0 million in June 2020/21.

This is an increase by R30.1 million (i.e.

43 per cent in nominal terms and 37.83 per cent in real terms).

Programme 3 accounts for 18.83 per cent of the total budget Vote in 2021/22.
The Programme’s budget is the third largest allocation, as it caters for Management: Negotiations, Labour Relations and Remuneration; Negotiations, Labour Relations and Dispute Management; Remuneration, Employment Conditions and Human Resource Systems within the Department.

The programme’s strategic focus areas are “A stabilised Public Service; and Intensifying the Fight against Corruption”.
The Department focus under this programme will be to manage collective bargaining processes conducted for the State in the Public Service Coordinating Bargaining Council.

Furthermore, conduct a review of National and Provincial Programme 1 Structures and Personnel Expenditure Review.

The Department intends to develop a Job Evaluation System for the Public Service, and incorporate the Professional Ethics in the 12 93 Induction Programme.
The Department will produce a consolidated annual report on the status of resolution of disciplinary cases and the impact of interventions implemented.

The Department during the course of the financial year will commence with the development of Job Evaluation System.
The Technical Assistance Unit for Ethics and Integrity in the public service will carry out a number of measures to tackle corruption in the public service, which include amongst others: the implementation of interventions to support the timely resolution of disciplinary cases and the reporting of criminal conduct in the public administration to the relevant law enforcement authorities initiated.
Moreover, produce annual report on discipline management and issue guidelines on Conducting Lifestyle Audits to national and provincial departments, provide implementation support and assess implementation thereof.
7.4 Programme 4: e-Government Services and Information Management The function of Programme 4: e-Government Services and Information Management (formerly known as Government Chief Information Officer) is to manage, oversee and facilitate ICT governance, e‐enablement, ICT infrastructure, information and knowledge management, and innovation in the public service and coordinate and facilitate ICT stakeholder management.
Information and Communication Technology (ICT) is playing an ever-increasing role as a strategic enabler of public service delivery.

This programme receives the smallest allocation, i.e.

6.82 per cent share or R35.9 million of the total Vote in 2020/21.

However, the allocation was revised upward by a significant R14.6 million (61.75 per cent in real terms).

In this regard, the Department strategic focus of the programme is “Improving the implementation of administrative policies”.
The strategic targets of the programme are to issue legislative frameworks to institutionalise the National e- Government Strategy and propose measures to National Treasury on the optimisation of ICT spend in the public service.

The programme will generate measures to reduce ICT expenditure in the public service.
The Department will work interactively with national and provincial departments to ensure that business continuity measures are established in the midst of the COVID-19 disruptions with more emphasis on the application of information technologies.

The ICT Governance and Management sub-programme is the main cost driver of the Programme at R13.1 million, followed by the e-Enablement and ICT Service at R7.5 million.
13 94 Budget allocation to this programme may not be enough, given that it establishes a legislative framework, strategies and roadmap to enable South Africa to craft a shared Fourth Industrial Revolution (4IR) future, as well as the constraints that are currently in place.

The 4IR is a substantive project, which requires a lot of financial and infrastructural resources.
Also, the growing need for IT utility due to the virtual conducting of business as a new norm imposes a new approach to the funding of the programme.

Risks imposed by cyber-bullying on Government IT requires more funding of the IT infrastructure.

7.5 Programme 5: Government Services Access and Improvement Programme 5: Government Service Access and Improvement (formerly known as the Service Delivery Support Programme) manages and facilitates the improvement of service delivery in Government.
As indicated in Table 1, the budget allocation for Programme 5 decreased from R109.4 million in 2020/21 to R104.8 million in 2021/22, representing a nominal decrease of R4.6 million or 4.20 per cent.

In real terms, the budget allocation to the programme decreased by 8.07 per cent between 2020/21 and 2021/22.

Strategic focus areas of the programme are “A stabilised Public Service; Improved implementation of administrative policies; and Improved implementation of Batho Pele Programme”.
Strategic targets of the programme are to issue the Organisational Functionality Assessment Tool to national and provincial departments and monitor the implementation of the Business Processes Modernisation Programme.

Furthermore, develop the Participatory governance mechanisms and citizen engagement programme.

The Department will under this programme develop Legislative Frameworks to support departments on public service delivery business continuity during the COVID-19 pandemic.
The Batho Pele Revitalisation Strategy will continue to be implemented across the public service.

The Department will continue to monitor the implementation of the Revised Batho Pele Programme.

The African Peer Review Mechanism Country Review Report and the National Plan of Action for the country will be rigorously monitored, evaluated and validated.
It is not advisable for Government to give less attention to this Programme in terms of budget allocation, since it enables the Department to give technical support and advice to national, provincial and local government institutions who experience service delivery challenges.

This will thwart preventative and remedial measures to service delivery challenges and protests.

The 14 95 main cost drivers are the Centre for Public Service Innovation (CPSI), whose allocation is R42.6 million.
The Service Access sub-programme consumes R17.8 million and Service Delivery Improvement, Citizen Relations and Public Participation sub-programme R13.9 million, whilst Operations Management consumes R13.6 million of the programme’s budget in 2021/22.

8.
8.

ENTITY OF THE DEPARTMENT OF PUBLIC SERVICE AND ADMNISTRATION 8.1 CENTRE FOR PUBLIC SERVICE INNOVATION 8.1.1 Policy Priorities The responsibility for the public sector innovation is vested in the Minister of Public Service and Administration, in terms of Section 3(1)(i) of the Public Service Act (1994).

The CPSI is established in terms of Section 7(a) listed in Schedule 3A of the Public Service Act, 1994, as amended and is an organ of state.
The Act mandates the Centre for Public Service Innovation (CPSI) to unlock, entrench and nurture the culture of innovation within the public sector for improved performance and productivity.

Therefore, the Act positions the CPSI to guide the process of unearthing and exploiting innovative, more efficient and effective solutions needed to ensure successful delivery on government priorities.

The CPSI was in its formation established as a Section 21 Company.
The functions of the CPSI are to: • Provide the Minister with independent, diverse and forward-looking research findings and advice on innovative service delivery with a specific focus of government priorities • Enhance public service transformation and reform through innovation partnership and projects Support the creation of an enabling environment for innovation within the structures and agencies of the South African Government (encouraging, learning and rewarding).
8.1.2 Budget Allocation 15 96 The CPSI’s budget is located within the budget appropriation of the DPSA, as a transfer through Programme 5.

The current budget allocation is according to the organisational mandate of the Centre.
Table 2: Budget allocation to the Centre 2021/22 Total Current payments R million Administration 21.5 20.8 Transfers and subsidies 0.0 21.1 Public Sector Innovation Total Source: National Treasury (2021) 42.6 21.1 42.0 - 0.0 2022/23 2023/24 Total Total Payments for capital assets 0.6 23.6 25.4 - 20.6 20.0 0.6 44.1 45.4 The overall budget allocation to the Centre is R42.6 million in 2021/22, up from an adjusted appropriation of R38.4 million in 2020/21.
This represents a significant nominal increase of 22.41 per cent and a real increase of 17.48 per cent.

9.

PROGRAMMES 9.1 Programme 1: Administration The programme provides strategic leadership, overall management of and support to the organisation.

There are three sub-programmes under programme 1, which are Strategic Management, Corporate Resource Management and Office of the Chief Financial Officer.

The allocation to this programme is R21.5 million, which is 50.46 per cent of the overall budget.
The allocation assists the Centre to run efficiently in executing its mandate.

The spending focus on the programme intends to build capacity in promoting innovation in the public service.

Over the medium term, the department will focus on promoting and unearthing innovation projects in the public service.

The Centre intends to review and submit the strategic plan and develop annual performance plan for the approval by the Executive Authority.
The Centre intends to assess its performance and report to the Executive Authority, DPSA, DPME and the National Treasury.

Review two 16 97 Corporate Resource Management policies, procedures and strategies.

Furthermore, the Centre will ensure 100% payment of all invoices paid within 30 days on receipt of valid invoice.

9.2 Programme 2: Public Sector Innovation The Programme drives service delivery innovation in the public sector in line with Government priorities.
There are three sub-programmes under Programme 2, which are Research and Development, Solution Support and Incubation, and Enabling Environment.

This programme has an allocation to the value of R21.1 million, which is 49.54 per cent of the overall budget.
The programme has three sub-programmes, namely: (i) Research and Development: This sub-programme establishes the knowledge base in support of the programme to inform the selection and development of potential innovative models and solutions; (ii) Solution Support and Incubation: This sub-programme facilitates the testing, piloting, demonstration, replication and mainstreaming of innovative solutions for the public sector; and (iii) Enabling Environment: This sub-programme nurtures and sustains an enabling environment, which entrenches a culture and practice of innovation in the public sector through innovative platforms and products.
The focus in this Programme is on the Research and Development of potential models and new innovative solutions, working in partnership with stakeholders in the National System of Innovation.

Service delivery solutions are developed in partnerships with other government departments, non-government organisations, the private sector, academia and international entities.

New solutions are tested and piloted with the service owners.
The Centre will identify knowledge platforms hosted to unearth, demonstrate, share, encourage and award innovation in the public sector.

10.

OBSERVATIONS AND KEY FINDINGS The Committee identified the following matters in relation to the Budget Vote 11: 10.1 The Committee notes and considered the Annual Performance Plans (APP) (2021/22) of the Department of Public Service and Administration and the Centre for Public Service Innovation (CPSI).
The APPs reaffirm the Department’s mandate to implement and coordinate interventions aimed at achieving professional, accountable and developmental 17 98 oriented public service, capable to deliver on the objectives of the National Development Plan (NDP) 2030 and the CPSI to facilitate and replicate new innovations.
10.2 The Committee welcomes the commitment made by the Minister regarding government moving towards a full implementation of the Public Administration Management Act of 2014, which aims to ensure, among other things, the integration and coordination between public service and local government.
10.3 The Committee notes developments towards amending the Public Service Act of 1994, which among others, seek to transfer powers of the human resource management from the Executive Authority to the Accounting Officers.

The Committee was of the firm view that such amendments have to include powers and responsibilities of the Head of Administration as proposed in Chapter 13 of the National Development Plan 2030.
10.4 The Committee notes the Department’s processes to reach amicable agreement with organised labour on wage negotiations.

The Committee requests that stakeholders maintain stability in the public service.

10.5 The Committee takes note of the DPSA’s finalisation of research on the future and repositioning of the Centre for Public Service Innovation, with an aim of putting the entity as a preferred choice among government departments when seeking innovative solutions to service delivery challenges.
11 RECOMMENDATIONS Having considered the planning documents and budgetary allocations for this financial year, the select committee recommends that the Minister Public Service and Administration should ensure that: 11.1 The Department fast-tracks the amendment all legislations before the 2022/23 financial year, to ensure that all administrative, management and governance systems are streamlined.

This will give Parliament ample time to finalise its legislation within the current sixth parliamentary term.
11.2 The Department ensures that the amendment Public Service Act of 1994 should include the establishment of the roles and responsibilities of the Head of Administration as one of the interventions encapsulated in the National Development Plan to manage career incidences of Heads of Department and other senior positions.

11.3 The Department finalises the second phase of regulations on the Public Administration Management Act of 2014 in order to give effect to comprehensive implementation of 18 99 the Act.
The Department should, therefore, report on these activities at the latest by March 2022.

11.4 The Department fast-tracks the implementation of the guidelines for conducting lifestyle audits in the public service.

The Department should present the progress report on these guidelines to Parliament by March 2022.
11.5 The CPSI develops innovative solutions to assist government to accelerate service delivery and replication where necessary and to hand over such solutions to the relevant departments for further implementation.

11.6 The CPSI ensures that all critical technical posts are filled, so that the entity continues to find new innovative solutions for enhancing efficiency in most government departments.
The Committee recommends that the National Council of Provinces (Council) approves Budget Vote 11: Public Service and Administration.

[The Economic Freedom Fighters (EFF) objected to the report.]

Report to be considered.

19 100 4.

REPORT OF THE SELECT COMMITTEE ON TRANSPORT, PUBLIC SERVICE AND ADMINISTRATION, PUBLIC WORKS AND INFRASTRUCTURE ON THE 2021/2022 BUDGET VOTE 7: NATIONAL SCHOOL OF GOVERNMENT, DATE 2 JUNE 2021 1.
Background The Select Committee on Transport Public Service and Administration, Public Works and Infrastructure (hereinafter referred to as the Select Committee), having considered the directive of the National Council of Provinces to consider and report on the Strategic Plan, Annual Performance Plan and Budget allocations of the National School of Government tabled by the Minister, reports as follows: 2.
Introduction In considering the strategic and annual performance plan, the Committee has ensured that the National School Government’s plan and budget allocation serve the needs and aspirations of the public servants.

Budget allocation serves as a key instrument for government to promote socio-economic development.
They plays a critical role as an economic instrument of the government to reflect on the country’s socio-economic policy priorities by translating priorities and political commitments into expenditures.

They serve as a vital tool to operationalise government activities towards the achievement of its intended priorities.

Furthermore, they highlight the constraints and trade-offs in policy choices.
On 26 May 2021, the Committee considered the presentation on the Strategic and Annual Performance Plans and budget allocation of the National School of Government (NSG).

This report summarises the presentation received from the NSG, focusing on the 2020/25 Strategic Plan and 2021/22 Annual Performance Plan and Budget as well as allocations over the medium-term.

3.
3.

Overview of the National School of Government (NSG) 1 101 The National School of Government (NSG) draws its mandate from the Constitution, and with particular reference to 195(1)(h), which stipulates that: “good human resource management and career-development practices, to maximise human potential, must be cultivated”.
The applicability of this, and the other values and principles to the three spheres of government, organs of state and public enterprises indicates the requisite depth and the reach of the NSG in order to fulfil this constitutional mandate.

The NSG has to ensure that all of the basic values and principles are inculcated into the value system and performance of all public servants and representatives through education, training and development (ETD) initiatives.
It does so through its curriculum design, development and delivery approach with the practical application of participatory, people-centred methodologies and the application of indigenous facilitation and learning techniques during the ETD initiatives, in building a caring ethos and citizen-centred service delivery focus amongst public servants.
This approach consciously focuses on the application of the principles and values of the Constitution and the realisation of the public administrative justice to all whom we serve.

4.

Legislative Mandate Section 197 of the Constitution provides for a public service within public administration, which must function, and be structured, in terms of national legislation, and which must loyally execute the lawful policies of the government of the day.
The NSG, as a national public service department, thus draws its mandate from national legislation – the Public Service Act, 1994 (Proclamation 103 of 1994), as amended.

This is the core mandate which establishes the NSG to fulfil its function of providing training or causing the provision of training to occur within the public service.

Accordingly, section 4 of the Act provides the following mandate: (1) There shall be a training institution listed as a national department (in Schedule 1 of the Act).
(2) The management and administration of such institution shall be under the control of the Minister (Public Service and Administration).

(3) Such institution, shall provide such training or cause such training to be provided or conduct such examinations or tests or cause such examinations or tests to be conducted as the Head of the institute may with the approval of the Minister decide or as may be prescribed as a qualification for the appointment or transfer of persons in or to the 2 102 public service.
The NSG may issue diplomas or certificates or cause diplomas or certificates to be issued to persons who have passed such examinations.

Whilst this piece of legislation empowers the NSG to fulfil its mandate, the limitation of the Public Service Act is that, it is only applicable to the national and provincial spheres of government.

Another piece of enabling legislation - Public Administration Management Act, 2014 (Act No.
11 of 2014) - gives effect, inter alia, to the progressive realisation of the values and principles governing public administration across the three spheres of government.

5.

Strategic Goals of the NSG The NSG strategy is aligned to the MTSF as well as the performance agreement of the Ministry for Public Service and Administration (MPSA) and is able to contribute to all of the aforementioned outcomes through Education and Training Development (ETD) interventions.
These outcomes and interventions are the reduction of wasteful, fruitless and irregular expenditure in public sector institutions; the reduction in incidents of corruption in the public sector; socio-economic rights; and gender mainstreaming in public sector institutions.

The NSG has, with a focus on social compact and engagement with citizens, developed and implemented ETD interventions in supporting the progressive realisation of socio-economic rights of communities.
This programme aims to capacitate Community Development Workers (CDWs), facilitate participatory community engagement for Ward Councillors, and Traditional Leaders for socioeconomic development.
The key strategic priorities of the Vote set for 2020/21 were: 5.1 Delivering on the compulsory and mandatory courses, as mandated by Cabinet Delivering on the compulsory and mandatory courses is in line with the vision of the NDP: Public Service and Outcome 12. of the MTSF, which states that the public service must have sufficient technical and specialist professional skills.

Skills deficits and insufficient attention to the role of the State in producing the skills remains a challenge.
To this end, Government, through the Public Administration Management Act, No.

11 of 2014, rebranded and transformed the Public Administration Leadership and Management Academy (PALAMA) into the National School of Government (NSG).

The NSG offers training programmes tailor- made for the upskilling and re-skilling of public servants.

Unlike before this provision was introduced, all public servants, including senior managers, have to undergo compulsory 3 103 induction when they join the public service.
The online programme – Nyukela - went live on 15 July 2019, as a compulsory offering in response to the Directive on minimum entry requirements for the SMS.

There have been more than 7 000 enrolments for the programme, with more than 2 400 having successfully completed.
5.2 Undertaking knowledge management, research and case study development In line with this strategy, the NSG undertook the following activities: 5.2.1 All NSG courses and programmes were aligned to government policy frameworks seeking to address quality service delivery.

5.2.2 The NSG undertook individual training needs analyses within departments and analyses of oversight reports (Auditor-General) to identify ways to improve in all areas of weaknesses /challenges of departments.
5.2.3 The NSG revamped its Batho Pele courses to be citizen-centred and worked with the Public Service Commission to mainstream the Constitutional Values and Principles (CVPs) in all its courses.
5.3 Reviewing the NSG curriculum in line with the Public Service Qualifications Matrix to support the career pathing and reskilling of public servants The NSG performed the following activities: § Trained 3000 interns and unemployed youth on the Breaking Barriers to Entry into the Public Service (BB2E) to enhance youth employment opportunities.

§ Revamped the BB2E programme to support the Formal Graduate Recruitment Scheme in the public service.
§ Rolled out a suite of Supply Chain Management programmes for public service and local government to strengthen government capacity to support job creation and localisation.

§ Rolled out the course on Leading Innovation in the Public Service.

Furthermore, worked with the Centre for Public Service Innovation (CPSI) to develop a strategy for the reskilling of public servants to mitigate the opportunities and threats of the Fourth Industrial Revolution (4IR).
4 104 § Collaborated with the Government’s Information Technology Officers Council (GITOC) to develop a programme for Chief Information Officers in the Public Service.

§ In support of the National Health Insurance (NHI) implementation, the NSG prepared itself to roll out targeted training programmes for nursing personnel, including the Compulsory Induction Programme; Managing Performance in the Public Service; Citizen Centred Service Delivery; and Excellent Customer Care for Frontline Service.
5.4 Addressing the NSG funding model and financial position Since the NSG’s current funding consists of partial funding appropriated by Parliament and income derived from cost recovery through training course fees, which is managed in the Training Trading Account (TTA), the NSG is required to recover all costs associated with the training of staff sent by the departments for training.

This includes costs associated with developing materials, marketing, logistics, and infrastructure for the NSG.
The NSG has a challenge to improve in this area since the pandemic has affected its revenue generation strategy, due to the challenge of numbers required to gather in one place at a time for training and social distancing.

Since the end of the 2019/20 financial year and the 2020/21 financial year, the cancellation and non-uptake of training has resulted in the NSG not being able to meet ETD targets as well as generating revenue.
This had a significant impact on the NSG to an extent that, the current budget could not absorb the impact of its losses.

The NSG had to revise the ETD numbers downwards for the 2020/21 financial year, with the potential for a deficit in revenue generation.

6 Budget Analysis The NSG overall budget allocation for 2021/22 is R210.2, compared to R227.4 million in 2020/21.

This represents a decrease of 7.6 per cent in nominal terms.
However, in real terms the total budget for the NSG decreased by 11.29 per cent between the 2020/21 and 2021/22 financial years.

The budget of the NSG is divided into two programmes, which share the allocated budget almost equally.

Programme 1: Administration consumes 51.9 per cent (R109.2 million) of the budget allocation whilst Programme 2: Public Sector Organisational and Staff Development consumes the remaining 48.1 per cent.
The NSG aims to continue to revise its funding model to ensure it generates more revenue through its training projects.

The revised funding model will propose that a portion of national 5 105 departments’ training budgets be redirected to the NSG to fund the mandatory training it provides.

The NSG planned to conclude its consultation with key stakeholders on the revised funding model in 2019/20 financial year.
The NSG plans to implement revisions to the trading account’s tariff structure to ensure that the NSG generates more revenue.
Table 1: National School of Government Budget Overall budget for 2021/22 Programme Budget Nominal Rand change Real Rand change Nomina % l change Real % change R million 2020/21 Million 2021/22 2021/22 2021/22 2021/22 Million Programme Administration 1: Programme 2: Public Sector Organisational and Staff Development 90,9 109,2 18,3 13,9 136,5 101,0 -35,5 -39,6 TOTAL 227,4 210,2 -17,2 -25,7 20,13 per cent 15,29 per cent -26,01 per cent -28,99 per cent -7,6 per cent -11,29 per cent Source: National Treasury (2021) 7 Programme Performance The NSG has two programmes whose budget and activities are as follows: 7.1 Programme 1: Administration The purpose of this Programme is to provide strategic leadership, management and support services to the NSG.
The budget for Programme 1 increased from R90.9 million in 2020/21 to R109.2 million in 2021/22.

This represents a 15.29 per cent increase in real terms in the budget allocation between 2020/21 and 2021/22.

The programme is one of the two major cost drivers under this Vote, consuming 51.95 per cent of the overall allocation.

It is also the only programme that experiences an increase in nominal and real terms.
The growth experienced in allocation to this Programme is mainly attributable to the significant growth evident in the Management and Corporate Services sub-programmes, which increase by 39.17 per cent and 17.39 per cent, respectively.

The Branch: Corporate Management and 6 106 Business Enablement ensures that the NSG performs as a fully functional integrated institution, creating an enabling environment for the core business functions to deliver on the overall mandate.
Corporate Services also dominates expenditure under the Programme, consuming R91.8 million (84 per cent) of the budget allocation to the Programme.

This is followed by Management, which consumes R16.7 million (15.29 per cent) of the allocation.
The Management sub-programme also looks after the Office of the Principal, which leads the organisational change and transformation agenda, whilst at the same time ensuring adherence to good corporate governance practices, and financial viability and sustainability of the trading entity of the NSG.

Organisation transformation is a current project of the NSG to repurpose training programmes, human and financial resources to adapt to the long-term effects of the COVID-19 pandemic on funding and training.
The NSG reduced the average number of days for debt collection to 60 days.

All disciplinary cases were resolved within 60 days from the date of receiving the case.

The NSG facilitated three agreements supporting international exchanges and capacity building initiatives.

The Programme has six targets for the financial year, which are to develop a Total Quality Management Policy and System for the NSG.
The NSG will map and implement three business processes in line with operations management plan and implement six ICT business solutions to enable NSG operations.

Furthermore, resolve 100% of material audit findings and implement 30% of the NSG Brand and Marketing Strategy.

The NSG intends to engage in 12 communication interventions promoting NSG offerings in the public sector.
7.2 Programme 2: Public Sector Organisational and Staff Development The Public Sector Organisational and Staff Development (Programme 2) is responsible for facilitating transfer payments to the Training Trading Account, which provides education, development and training to public sector employees.
The budget allocation for Programme 2 decreased from R136.5 million in 2020/21 to R101.0 million in 2021/21, due to adjustments necessitated by the advent of the COVID-19 pandemic, which saw many contact training programmes offered virtually and online.

In real terms the budget allocation of Programme 2 decreased by 28.99 per cent between 2020/21 and 2021/22.

This programme consumes 48.1 per cent of the overall budget.
The Programme’s budget (R101.0 million) is allocated to the 7 107 NSG Training Trading Account sub-programme, which provides education, development and training to public sector employees.

The NSG introduced the use of the e-Learning modality that enables it to offer e-Learning courses and to establish communities of practice, as well as open online courses.

The NSG undertook training needs analyses with public sector institutions.
The NSG completed research projects to inform training needs and opportunities.

The Programme has 22 targets for the financial year 2021/22, among which are to generate R118.5 million in revenue and other funding sources.

The NSG will further implement 50% of business development interventions resulting in opportunities for uptake of the NSG offerings.

The National Development Plan emphasises the importance of professionalising the public service.
The NDP highlights that building a skilled and professional public service requires a vision on how public servants experience and expertise develops during their careers.

Therefore, the NSG plays a fundamental role in ensuring that public service is professionalised by providing compulsory induction to all public servants.
The NSG intends to complete five skills assessment reports informing the Education, Training and Development needs and analyse report of Workplace and Sector Skills Plans to inform ETD interventions.

In this regard, the NSG will develop four research reports informing Education, Training and Development.

In this financial year, the NSG will document four areas of good practice in the public sector to enhance ETD interventions.
Furthermore, the NSG will develop an annual report on analysis of Workplace and Sector Skills Plans to inform ETD interventions.

The programme will develop and review eight courses/programmes/interventions responsive to identified skills gaps and government priorities.

Six impact evaluation studies will be conducted.

The NSG will develop the National Implementation Framework on the professionalization of the public service and develop a post-graduate qualification developed for the NSG.
The NSG will facilitate 20% partnership to support ETD interventions and host five thought platforms/seminars.

The NSG intends to develop the framework for performance management system for ETD practitioners.

Moreover, facilitate and manage accreditation process to maintain the status of the NSG as an accredited training provider.

The NSG will quality assure eight programmes/courses by the NSG Quality Assurance Committee.
The NSG will implement four compulsory programmes and train 38 460 learners on compulsory and demand- 8 108 led ETD interventions.

Cumulatively train 30% of senior managers in the public service on how to deal with all forms of discrimination.

8 Select Committee Observations and Findings 8.1 The Select Committee considered the Annual Performance Plan of the NSG for the 2021/22 financial year.
The APP contextualises the work of the NSG, which aims to strengthen state capacity and building an efficient, capable, ethical and developmental state through education, training and development.

The NSG was commended for turning around the crisis of the COVID-19 pandemic as an opportunity to transform its business operations.

8.2 The Committee notes a high number of officials who had enrolled on the compulsory training courses.
The NSG was applauded for such achievement of attracting more public servants to enrol for the training course during the pandemic, however, the Committee appealed to the NSG to categorise training intakes per province for easier understanding.
9 Recommendations Having considered the planning documents and budgetary allocations for this financial year, the select committee recommends that the Minister Public Service and Administration should ensure that: 9.1 The NSG, together with the Department of Public Service and Administration, continues to engage the National Treasury in exploring alternative methods of a funding model.
9.2 The NSG develops a fully-fledged Funding Model to maintain the self-generated income through the Training Trading Account.

9.3 The NSG offers accredited courses so that full recognition is afforded to employees being trained, so that they have opportunities for development and promotion.

9.4 The NSG carries through with partnership projects with accredited bodies, among which is the Institute of Directors, to empower boards serving in the State-owned Entities and other related bodies.
9.5 The NSG considers, where possible, to offer most of its training courses through e-Learning platforms, as part of modernising its business and saving costs on the logistics such as venues and transportation.

9 109 9.6 The NSG develops a course on conflict management for Public Service Commissioners, as the Commission has realised that where a full investigation cannot be done due to time and human resource constraints, it is expedient and quicker to engage in mediation exercise.
The Committee recommends that the National Council of Provinces (Council) approves Budget Vote 7: National School of Government.

[The Economic Freedom Fighters (EFF) objected to the report.]

Report to be considered.

10 110 5.

REPORT OF THE SELECT COMMITTEE ON SECURITY AND JUSTICE ON THE 2021/22 BUDGET VOTE 21, ANNUAL PERFORMANCE PLAN (APP) OF THE CIVILIAN SECRETARIAT FOR POLICE (CSPS), DATED 2 JUNE 2021.

1.
1.

Introduction The National Council of Provinces (NCOP), in terms of section 42(4) of the Constitution, represents the provinces to ensures that the provincial interests are taken into account in the national sphere of government.

One of these functions is to hold the government to account in respect of how the taxpayers’ money is used.

It detects waste within the machinery of government and public agencies.

Thus it can improve the efficiency, economy and effectiveness of government operations.
It is with this in mind that the report represents an overview of the Civilian Secretariat for Police Services (CSPS) strategic plan, annual performance plans and budget.

The Civilian Secretariat for Police Services (CSPS) mandate is to conduct civilian oversight of the police service and provide policy and strategic support to the Minister, including administrative support in relation to his international obligations.
The Secretariat is also mandated to monitor the implementation of the Domestic Violence Act (1998) by the South African Police Service.

The Civilian Secretariat also has Provincial Secretariats who are given the mandate to perform the functions of the Civilian Secretariat for Police Service within the provincial sphere of government.

Provincial secretariats do not report directly to the Department, but report to their respective heads of department (HoDs) and the Members of the Executive Council (MECs).
However, the Provincial Secretariats must undertake the following tasks in order to support the objects of the CSPS: • Align their plans and operations at the provincial sphere of government with the plans, policies and operations of the Department; and • Integrate their strategies and systems at the provincial sphere of government with the strategies and systems of the Department.

The budgeting and resourcing of the Provincial Secretariats come from the provincial budget and not from the national CSPS.
Provincial Secretariats do not have their own provincial budget votes, but reflect as a Budget Programme of the provincial Departments of Safety.

1 111 For the purposes of this report, the national and provincial budgets have been included as provided to the Committee by the Secretariat.

The Select Committee on Security and Justice, on 21 May 2021, held a virtual briefing with the Civilian Secretariat for Police on their budgets and APP.
The engagement with the Department has taken place within the context of the Covid-19 pandemic which has a bearing on the work of the Department.

2.

Strategic Plans The overall strategic goal of the Secretariat is to conduct civilian oversight over the police and provide the Minister of Police with strategic support.

The CSPS has a key role to reduce violent crime through the promotion of a more active citizenry and the establishment of a new social compact.
This can find expression in the implementation of the 2016 White Paper on Safety and Security that is focussed on realising the vision of the NDP and calls for an integrated and holistic approach to safety and security across all government departments and civil society.
2.1 Strategic Focus 2020-2025 The Department’s strategic focus for the financial year and over the medium term includes the following, amongst others: • Addressing the lack of trust in the police and improving police service delivery; • The need for a localised approach to address crime concerns; • Targeted implementation of the Provincial and Local Crime Prevention Frameworks and District Action Plans, in line with the District Development Model (DDM); • Implementation of the 2016 White Paper on Safety and Security; • Beefing up detective services and forensics, as well as facilitating the modernisation of SAPS through an e-Policing Policy; • Finalisation and implementation of an Integrated Crime and Violence Prevention Strategy (ICVPS); and • Implementation of the Partnership Strategy and Framework which seeks to mobilise key role-players and harness the social capital in communities by facilitating greater involvement of various community safety structures in the fight against crime.
2 112 2.2 Factors Contributing to the Performance of Policy • Key National Outcome: realigning our policy orientation and strategic research focus to contribute towards the priority of halving violent crimes within five years, linked to the outcome of improved safety and security for citizens.

• Community Engagement: enhancing the role of oversight in contributing to resolution of burning issues in the country, for example, racism (Normandien and Senekal), and other flare-ups.
• Alignment of Functions and Improved Service Delivery: focusing on tangible ways to strengthen SAPS service delivery and enable SAPS to become more effective; determining how CSPS will implement, promote and align its national and provincial operations in this regard; and ensuring CSPS alignment with the DDM, NSP on GBV and Femicide and other normative framework.
• Minister’s Programme of Action: monitor the implementation of Crime Retreat outcomes and improve collaboration between National and Provincial Secretariats to address capacity requirements in this regard.

• Institutional Reform for the Civilian Secretariat: fully implement reforms proposed by the 2016 White Paper on Policing.

2.3 Emerging Priorities for 2021/22 • Finalisation of an e-Policing Policy towards the attainment of a 4IR policing environment.
• Facilitating implementation of the ICVPS for safety and service delivery.

• Research on whether the SAPS achieving its Constitutional mandate.

• Making impact in the JCPS cluster restructuring process for effective implementation of policies and improved service delivery.

• Monitoring and reporting on the implementation of the Minister’s Programme of Action emanating from the Crime Retreat.

• Providing oversight reports on police station profiles in the context of Ministerial Izimbizo.
• Providing oversight reports on police performance station and profiles in contribution to the implementation of the DDM.

• Raising awareness on the role of CSPS in monitoring DVA implementation.

3 113 • Regular community satisfaction surveys and exit polls to measure public perceptions in terms of the performance of the police.

• GBV campaigns and project implementation in the build up to the 16 days of activism on violence against women and children.
• Continued implementation of both the Human Capital Strategy and the ICT Strategy for organisational efficiency.

3.

Budget Allocation 2021/22 3.1 National Budget Allocation The CSPS received a Main Appropriation of R149 million in 2021/22, which is a nominal increase of 8.68 per cent compared to the previous financial year.

In real terms (inflation considered), the Department’s allocation increased with R5.8 million, or 4.22 per cent.
The Administration Programme received a Main Appropriation of R66.5 million in 2021/22, which is a nominal increase of 9.2 per cent (considering inflation, it is a real increase of 4.79 per cent) compared to the previous financial year.
The Intersectoral Coordination and Strategic Partnerships Programme received a Main Appropriation of R25.7 million in 2021/22, which is a nominal increase of 10.3 per cent compared to the previous financial year, which is the most substantial increase in the Department’s budget programmes.

Considering inflation, the Programme received a real increase of 5.85 per cent.
The Legislation and Policy Development Programme received a Main Appropriation of R23.2 million in 2021/22, which is a nominal increase of 4.5 per cent and a real increase of only 0.29 per cent compared to the previous financial year.

The Civilian Oversight, Monitoring and 4 114 Evaluation Programme received a Main Appropriation of R33.6 million in 2021/22, which is a nominal increase of 9.45 per cent and a real increase of 5.03 per cent compared to the previous financial year.
The Inter-sectoral Coordination and Strategic Partnerships Programme continues to receive the third largest proportional allocation of the total Departmental budget at 17.25 per cent.

This is a slight increase of 0.27 per cent compared to the previous financial year.

The Legislation and Policy Development Programme continues to receive the smallest proportional allocation at 15.57 per cent.
The Programme’s proportional allocation decreased with 0.61 per cent in 2021/22 compared to the previous financial year.

3.2 Provincial Budget Allocations • Section 16 of the CSPS Act, 2011 gives provision for the establishment of Provincial Secretariats to support and align their mandate with the mandate of the Civilian Secretariat.
• The Provincial Secretariats are, therefore, established by the MECs for Community Safety in the various provinces and fall within the provincial departments of Community Safety which they are accountable to.

• In order to support the operations of the CSPS at provincial level, the Provincial Secretariats must align their plans and operations with the plans, policies and operations of the Civilian Secretariat; and integrate their strategies and systems at the provincial sphere of government.
• Departments that have not yet established Provincial Secretariats have a Chief Directorate, with a dedicated budget, which performs the operations aligned to the CSPS mandate.
• In supporting the mandate of the CSPS, Provincial Secretariats: o Carry out police station oversight visits to monitor police performance o Monitor police conduct and investigate complaints against the police o Conduct research on policing and safety issues o Conduct crime prevention initiatives o Facilitate strengthening of community police relations Provincial Budget Allocation 5 115 The Provinces with the highest budgets are (from highest to lowest): Western Cape, Kwazulu Natal, Limpopo and North West Provinces.
Gauteng has a low allocation, considering the size of the population and number of police stations in the province.

3.3 Impact of Covid19 on Resourcing and Vacancies • The CSPS and all provinces were affected by budget cuts, which also impacted on the ability to conduct all planned oversight visits.

• The lockdown restrictions and the guidelines by DPSA to reduce the number of employees at the workplace to 50%, exacerbated the slow pace of recruitment and filling of vacancies within the CSPS.
• There was no serious negative impact on resources as a result of COVID19, however some provinces like NC, MP, FS, NW and WC generally have insufficient resources within their monitoring and evaluation units.

• Unavailability of funds is the major contributing factor that negatively impacts on the inability of Provincial Secretariats to increase their human capacity.
• As physical access became more restricted during the different levels of lockdown, some of the planned monitoring activities to conduct oversight to police stations on the implementation of DVA were put on hold.

• To ensure work still continued, virtual methods of interacting with the police were used and a limited number of visits were conducted by Provincial Secretariats with adherence to Disaster Management regulations on COVID19 regulations considered.
6 116 3.4 Gender Based Violence and Femicide Response The CSPS and Provincial Secretariats budget have catered for GBVF programmes as part of funds allocated for monitoring and evaluation, and crime prevention/anti-crime campaigns.
The following are prioritized and budgeted for in order to give effect to Government priority on GBVF: • Continuous monitoring SAPS compliance and implementation of the DVA • Oversight to the top 30 police stations with high levels of GBVF related crimes (nationally and in each province) - The focus will be on assessing: • GBVF response by the frontline police officials through the following: levels of compliance to DVA and implementation thereof; what is in place to enhance police response; how effective are the response measures; • Availability and suitability of private interviewing space / Victim friendly facilities; • Response to complaints relating to poor response for GBVF related cases; • Resourcing of the FCS units servicing the top 30 police stations • Court watching briefs to identify systemic issues that lead to withdrawal of GBVF related cases – with focus on police responsibilities • Awareness campaigns involving community and faith based organizations The Department will continue to work with institutions of Higher Learning and TVET Colleges to implement programmes to deal with Campus Safety for Students through collaborations with various stakeholders 4 Annual Performance Plans 2021/22 4.1 Programme 1: Administration Programme purpose: The purpose of the Administration Programme is to provide strategic leadership, management and support services to the Department.
For the 2021/22 financial year, the Department identified six performance indicators for the Administration Programme, of which all targets remained unchanged.

Sub programme: Department Management 7 117 1) Number of joint consultative IPID/Secretariat forum meetings held per year in compliance with the Civilian Secretariat for Police Service Act, 2011: Target remains unchanged at four meetings annually.
Sub programme: Corporate Services 2) Vacancy rate of not more than 7% of the total post establishment: Target remains unchanged at not more than 7% in 2021/22.

3) Percentage of implementation of the Human Capital Strategy: Target remains unchanged at 100% implementation.

4) Percentage implementation of the Information and Communication Technology (ICT) Strategy: Target remains unchanged at 100%.
Sub-programme: Finance Administration 5) Percentage of payments made to creditors within 30 days: Target remains unchanged at 100%.

6) Percentage of expenditure in relation to the allocated budget: Target remains unchanged at 98%.

4.2 Programme 2: Inter-sectoral Coordination and Strategic Partnerships Programme purpose: The purpose of the Inter-sectoral Coordination and Strategic Partnerships Programme is to manage and encourage national dialogue on community safety and crime prevention.
For the 2021/22 financial year, the Programme identified six performance indicators.

Sub programme: Intergovernmental, Civil Society and Public-Private Partnerships 1) Number of memoranda of understanding (MoUs) signed with stakeholders in order to build safer communities: Target remains unchanged at two MOUs for 2021/22.

2) Number of workshops facilitated with Provincial Secretariats and municipalities on the establishment of Community Safety Forums (CSFs): Target remains unchanged at nine workshops.
3) Number of provincial capacity-building sessions held on crime prevention policies per year: Target remains unchanged at nine sessions.

8 118 4) Number of anti-crime campaigns conducted per year: Target remains unchanged at three campaigns.

5) Number of monitoring reports on implementing Community Policing Forum (CPF) regulations/standards approved by the Secretary: Target remains unchanged at two reports.
Sub programme: Community Outreach 6) Number of izimbizo/public participation programmes held with communities to promote community safety: Target increased from four in 2020/21 to eight in 2021/22.

4.3 Programme 3: Legislation and Policy Development Programme purpose: The purpose of the Legislation and Policy Development Programme is to develop policy and legislation for the police sector and to conduct research on policing and crime.
For the 2021/22 financial year, the Programme identified four performance indicators.

Sub programme: Policy Development and Research 1) Number of draft national policing polices submitted to the Secretary for approval per year: Target remains unchanged at one policy.

2) Number of research reports on policing approved by the Secretary per year: Target increased from one research report to two research reports.
3) Number of newsletter (gazettes) published on SaferSpaces per year: Target remains unchanged at one newsletter.

Sub programme: Legislation 4) Number of Bills submitted to the Minister for Cabinet approval per year: Target remains unchanged at two bills.

4.4 Programme 4: Civilian Oversight, Monitoring and Evaluation Programme purpose: The purpose of the Civilian Oversight, Monitoring and Evaluation Programme is to oversee, monitor and report on the performance of the SAPS.
For the 2021/22 financial year, the Programme identified 10 performance indicators.

9 119 Sub programme: Police Performance, Conduct and Compliance Monitoring 1) Number of Police Station Oversight Reports approved by the Secretary: Target decreases from four reports in 2020/21 to three in 2021/22.

2) Number of SAPS Budget and Programme Performance Assessment Reports approved by the Secretary for Police Service per year: Target remains unchanged at one report.
3) Number of Assessments Reports on Complaints Management approved by the Secretary for Police Service per year: Target remains unchanged at two reports.

4) Number reports on SAPS Implementation of IPID Recommendations approved by the Secretary for Police Service per year: Target remains unchanged at two reports.
5) Number of Compliance Monitoring Reports on the implementation of the Domestic Violence Act, 1998 by SAPS approved by the Secretary for Police Service per year: Target remains unchanged at two reports.

6) Number of reports on the implementation and compliance to legislation and policies approved by the Secretary: Target increased from one to two reports.

7) Number of assessment reports in police conduct and integrity approved by the Secretary per year: Target remains unchanged at one report.
8) Number of reports on the functioning of the National Forensic DNA Database assessed per year: Target remains unchanged at four reports.

Sub programme: Policy and Programme Evaluations 9) Number of assessment reports on SAPS programmes approved by the Secretary: Target remains unchanged at one report.

10) Number of evaluation reports on legislation and policies approved by the Secretary per year: Target remains unchanged at one report 5.
Discussions / Responses by the Minister and the Department 5.1 Budget Cuts Members wanted to know how the budget cuts would practically impact on the programmes of the Department.

The Minister responded that the budget is never sufficient and there is no corresponding financial power between SAPS and CSPS.

Efforts have been made to raise 10 120 additional budgetary amounts with National Treasury, but these efforts have been unsuccessful.
Due to online engagement as a result of the Covid-19 pandemic, the CSPS has managed to remain within its budget.

However, if the negotiations regarding salary increases are successful, this could impact the budget.

In terms of the staff complement, they are supposed to have 250 employees and currently have 155 filled posts and are therefore looking at appointing an additional 50 staff members.

However, if the budget cuts continue, the CSPS will not have the necessary resources to achieve its targets.
5.2 Crime in Mpumalanga Members wanted to know about the recent spate of killings in Mpumalanga and the possibility of corrupt police officials involved in this.

The Minister expressed his disappointment at the potential of police officials being involved in such activities and indicated that the police are working hard to address this and have opposed bail in one case.
The Minister requested that if members have any information pertaining to police officers involved in corrupt activities, that the information is passed on to SAPS to address this.

5.3 Gender Based Violence and Femicide (GBVF) Statistics Members wanted to know how the Department plans on reducing the GBVF statistics.

The Minister responded that the CSPS conducts monitoring and evaluation of GBVF and that SAPS is working on GBVF on the ground.
SAPS has put extra resources into enhancing Family Violence, child protection and sexual offences units (FCS) working with the top 30 police stations.

SAPS is also training more than 1200 extra people who have been placed at police stations.

SAPS is working with the NPA on cases to ensure that there are less withdrawals of cases in most provinces.
5.4 Police Integrity Members were concerned about the integrity of police officers and the unprofessional manner in which some police officials deal with the public.

Members wanted to know what progress has been made in addressing this.
The Minister agreed that there are those police officials who do not operate with integrity and that the CSP and IPID are assisting SAPS in addressing these incidents and SAPS is continuing to implement disciplinary action against those officials who are guilty of wrongdoing.

5.5 Backlog in DNA testing 11 121 Members were concerned about the backlog in forensics and DNA testing and requested that the Committee be given a timeframe within which this backlog will be addressed.
The Minister responded that the backlog impacts negatively on the resolution of GBVF cases and murder.

The Minister has embarked on various strategies to address this including visits to the laboratories in Pretoria and the Western Cape.

The Minister said that the backlogs are due firstly to corruption in the procurement process and secondly due to the poor management of contracts.
To address these challenges, National Treasury has been approached and with the result an additional 127 people are now working in the laboratories to increase personnel.

An extra R250 million has been allocated for the extra personnel.

A new trace and track mechanism has been developed to chase 11000 DNA samples per week and the turnaround time for this project is approximately 18 months within which the backlog should be addressed.
5.6 E Policing and Modernisation Members wanted to know what the focus of the first phase of the e-Policing project is, if the second phase entails the development of an e-Policing Policy.

Members sought clarity regarding costing and implementation amidst serious challenges regarding Information and Communication Technology (ICT), such as the lack of sufficient broadband infrastructure.
Members also wanted to know how this will be addressed in rural areas The CSPS responded that the E policing policy looks at how SAPS should deal with technology strategically.

Given that the number of police officers are being cut, the policy will look at what kind of technology can be brought in to address diminishing numbers of personnel.
Environmental design also impacts on policing and the E policing policy will look at mechanisms to address this, including rural environments and look at how it can assist the environment to improve efficiency.

5.7 Engagements with IPID Members wanted to know what the tangible achievements were and the challenges that arose from the joint meetings between the CSPS and IPID as per the target of 4 meetings per year.
The CSP responded that the consultative forum is in place which reviews whether recommendations are being implemented.

One challenge is that the NPA is failing to prosecute certain cases and the CSPS is of the view that the NPA should be part of these consultative forums which forms part of the current amendments to the IPID Amendment Bill.
The CSPS 12 122 is also including a clause in the draft SAPS Bill to ensure that SAPS must have dedicated resources of people dealing with disciplinary cases as currently there are no dedicated persons which causes delays.

5.8 ICT Framework Members wanted more information on the ICT framework.

Members wanted to know whether it has been approved, how it has been implemented and what challenges have been experienced.

The CSPS responded that they have their own approved framework.
ICT has generally been very weak, as the building they are currently occupying does not have an in-house ICT service and they rely on an external service provider.

The strategy will assist CSP with becoming efficient and their work will be more accessible.

The CSPS had a challenge with a tender process with SITA which took two years to finalise and they are currently addressing this matter.
Another challenge related to the DPW building which they were meant to move into 2 years ago and the DPW brought in another client, which required CSPS to rethink its strategy moving forward.

5.9 Domestic Violence Act (DVA) compliance Members wanted to understand the reasons for non-compliance in respect of the implementation of the Domestic Violence Act (DVA) and what the main reasons were for non- compliance.

The CSPS responded that they go to police stations to monitor how SAPS is implementing the DVA.
The CSPS assesses whether police stations have victim friendly rooms, how they deal with violence against women and review their DVA register.

The policy to reduce GBVF and sexual offences has resulted in the Ministerial 6-point plan.

Posters of the 6-point plan are put up in all police stations so that victims know what their rights are.

Two reports are tabled in parliament per year on the DVA implementation and the CSP committed to ensuring that these reports are submitted to the Committee.
In the event that the Committee would like a presentation on the report, the CSPS is willing to present its findings to the Committee.

5.10 Human Capital Strategy Members wanted to know how the human capital strategy indicator would be measured.

The CSPS responded that this strategy is overarching and is coupled with the operational strategy on health and wellness.
Human Resources strategies were developed with the aim of 13 123 improving efficiencies in the Department by implementing and assessing the strategy through regular job satisfaction surveys.

The strategy has strengthened the performance management system as all employees are required to sign performance agreements and these are moderated.

The objective is to make sure they are properly aligned with the CSP strategy.
5.11 Bills that will be introduced Members wanted to know which Bills the CSP intends introducing.

The CSPS indicated that the following Bills will be introduced: Firearms Control Amendment Bill, IPID Amendment Bill and the DNA Bill.

5.12 Rural Safety Strategy: Members wanted to know what the strategy was to address crime in rural areas.
The CSPS responded that the rural safety strategy is being implemented and last year the Minister met with traditional leaders and with farmers and they have signed a memorandum of agreement to work with rural communities to ensure the rural safety strategy is realized.

6.

Recommendations 6.1 The Department should ensure that despite budget cuts, it finds innovative ways to fulfil its functions and mandate and work towards achieving the targets in its Annual Performance Plan.
6.2 The Department should furnish the committee with the DVA implementation report as well as all other research documents in order for the Committee to be kept abreast of research findings and recommendations within 30 days of the adoption of the report by the Committee.

The Committee welcomed the suggestion that a presentation would be made on such findings to the Committee.
6.3 The Department should continue to strengthen its efforts to monitor the implementation of the Domestic Violence Act at police stations, particularly in rural police stations.

The Department should ensure that all police officials are treating victims of domestic violence with dignity and integrity.

14 124 6.4 The Department should include the NPA in its consultative forum meetings to ensure the least amount of cases are withdrawn by the NPA and to further enhance its working relationship with the NPA.
6.5 The Department should develop and implement working protocols with Provincial Secretariats to streamline the roles and functions clearly.

6.6 The Department should work towards improving its ICT infrastructure to ensure that its services are accessible in all Provinces, including those in rural areas.
6.7 The Department should within 30 days of the adoption of the Report by the Committee furnish the Committee with a status report on the functioning and resource challenges that exist within the Provincial Community Policing Forum (CPF) structures.

7 Conclusion The Committee welcomed the presentation by the CSPS and recognised the challenges the Department is encountering in various areas of work.
The Committee encouraged the Department to continue its important work in respect of monitoring SAPS, including DVA compliance and continuously ensuring the effective functionality of CPF structures within communities, all of which contributes towards ensuring safer communities.

The Select Committee on Security and Justice supports Budget Vote 21.

Report to be considered.

15 125 6.


REPORT OF THE SELECT COMMITTEE ON SECURITY AND JUSTICE ON THE 2021/22 BUDGET VOTE 24, ANNUAL PERFORMANCE PLAN (APP) OF THE INDEPENDENT POLICE INVESTIGATIVE DIRECTORATE (IPID), DATED 2 JUNE 2021.

1.

Introduction The National Council of Provinces (NCOP), in terms of section 42(4) of the Constitution, represents the provinces to ensures that the provincial interests are taken into account in the national sphere of government.
One of these functions is to hold the government to account in respect of how the taxpayers’ money is used.

It detects waste within the machinery of government and public agencies.

Thus it can improve the efficiency, economy and effectiveness of government operations The Independent Police Investigative Directorate (IPID) exercises its functions in accordance with the Independent Police Investigative Directorate Act.
The Act gives effect to the provisions of section 206(6) of the Constitution, which provides for the establishment of an independent police complaints body that must investigate any alleged misconduct of, or offence committed by, a member of the police service.

The thrust of the Directorate’s work is to investigate serious and priority crimes allegedly committed by members of the South African Police Service and the Municipal Police Services.
The Select Committee on Security and Justice, on 21 May 2021, held a virtual briefing with IPID on their strategic plans, budgets and annual performance plans.

The briefing was held during the Covid-19 pandemic which has an impact on the work of the Department.

1.1.

IPID Executive Director The position of the Executive Director of IPID became vacant from 01 March 2019.

Since then, the IPID had two acting Executive Directors.
On 05 August 2020, the Minister of Police appointed, Ms Jennifer Ntlatseng, as the permanent Executive Director of the IPID.

The 2021/22 financial year marks the first in year in which the Directorate has a permanent head in three years.

1 126 2.
1 126 2.

Strategic plan IPID’s contribution to the National Development Plan is in terms of Chapter 12: building safer communities which envision people living in South Africa feeling safe and having no fear of crime and Chapter 14: promoting accountability and fighting corruption which envisions a South Africa with zero tolerance to corruption, accountable public and private officials and leaders acting with integrity and maintaining high ethical standards.
IPID’s contribution to the Medium Term Strategic Framework (MTSF) 2019-2024 is in respect of Priority 1: a capable, ethical and developmental state and Priority 6: social cohesion and safe communities.
2.1 Key Strategic Priorities IPID has tabled the following key priorities in the 2021/22 Annual Performance Plan: a) The finalisation of the IPID Amendment Bill; b) Strengthening the investigative capacity and refining processes to improve the quality of investigations; c) Prioritisation of cases which will include Gender Based Violence and Femicide (GBV&F), rape, death, corruption and torture; d) Full implementation of Section 23 of the IPID Act to comply with court orders; e) Continuous implementation ICT key infrastructure projects; f) Development and implementation of new strategies in line with the department’s ten- point plan; g) Strengthening of partnership through development and signing of an MoU with key stakeholders; and h) Strengthening of internal control systems to ensure compliance with applicable legislation.
IPID reported that Provinces contributed to the Strategic plan in the following ways: • Improved Financial governance; • Percentage increase of vacancies filled within 6 months; • • Increase in number of criminal cases decided by NPA; Increase in number of disciplinary recommendations initiated; 2 127 • • Increase in number of disciplinary recommendations finalized; and Increase in number of people reached at through awareness raising campaigns.

3.
3.

Budget Allocation 2021/22 The IPID received a Main Appropriation of R348.3 million in 2021/22, which is a nominal increase of 2.1 per cent.

However, taking into account inflation, the Directorate’s allocation decreased by 1.98 per cent.

The Administration Programme received an allocation of R101 million in 2021/22, which is a nominal increase of 12.35 per cent, or real increase of 7.82 per cent compared to the previous financial year.
The Investigation and Information Management Programme received a Main Appropriation of R227.5 million, which is a nominal decrease of 2.15 per cent compared to the previous financial year.

However, when considering inflation, the Programme’s allocation decreased with 6.09 per cent.
Table 1: Comparative changes in expenditure estimates by programme: 2020/21 to 2021/22 Programme Budget Nominal Increase / Decrease in 2021/22 Real Increase / Decrease in 2021/22 Nominal Percent change 2021/22 Real Percent change in 2021/22 in R million 2020/21 2021/22 Administration 89.9 101.0 Investigation and Information Management 232.5 227.5 11.1 - 5.0 7.0 12.35 per cent 7.82 per cent - 14.2 -2.15 per cent -6.09 per cent and 6.0 6.4 0.4 0.1 6.67 per cent 2.37 per cent Legal Investigation Advisory Services 12.6 13.4 0.8 0.3 6.35 per cent 2.06 per cent Compliance Monitoring Stakeholder Management and TOTAL 341.0 348.3 7.3 - 6.7 2.1 per cent -1.98 per cent Source: National Treasury (2021) The Legal and Investigation Advisory Services Programme received a Main Appropriation of R6.4 million in 2021/22, which is a nominal increase of 6.67 per cent and real increase of 2.37 per cent compared to the previous financial year.
The Compliance Monitoring and Stakeholder 3 128 Management Programme received a Main Appropriation of R13.4 million in 2021/22, which is a nominal increase of 6.35 per cent and a real increase of 2.06 per cent compared to the previous financial year.

The Department’s proportional allocation to Programmes changed in 2021/22 compared to the previous financial year.
The most substantial change was an increased proportional allocation to the Administration Programme, which led to a decreased proportional decrease to the Investigation and Information Management Programme.

The proportional allocation to the Administration Programme increased with 2.63 per cent, while that of the Investigation and Information Management Programme decreased with 2.86 per cent.
Despite the decrease in its proportional allocation, the Investigation and Information Management Programme continues to receive the bulk of the Department’s total allocation at 65.32 per cent thereof.
3.1 Provincial Budget ADJUSTED BUDGET PROVINCES EASTERN CAPE FREE STATE GAUTENG KWAZULU-NATAL LIMPOPO MPUMALANGA NORTH WEST NORTHERN CAPE WESTERN CAPE TOTAL 2018/19 16,221,925 16,998,458 20,998,951 18,001,176 15,918,669 13,910,265 13,909,189 11,953,845 20,155,537 148,068,015 2019/20 15,712,000 17,665,000 21,097,000 18,757,125 15,864,912 13,683,875 15,103,530 13,307,147 19,943,000 151,133,589 2020/21 20,756,124 20,673,660 28,451,350 24,818,297 18,449,740 17,571,236 16,806,281 15,167,568 24,852,311 187,546,567 2021/22 19,661,000 19,755,000 22,935,000 21,774,000 18,053,000 16,699,000 15,846,000 13,931,000 21,993,000 170,647,000 IPID has provincial offices and therefore each province has received an allocation of the main budget.
The total amount distributed to provinces for the 2020/21 financial year is R170 647 million.

Gauteng receives the biggest allocation of R22 935 million, closely followed by the Western Cape of R21 993 million and Kwazulu-Natal of R21 774 million.

The Department informed the committee that it is trying to shift the budget from non-core activities to the Provinces where the actual work is being done.
4 129 3.2 Current Provincial Vacancies, Challenges on Staffing, Resource & Key Achievements 3.2.1 Challenges on staffing and resources in Provinces: • Capacity personnel constraints taking into account high case workload.

• The Department baseline allocation has been reduced over the 2021 MTEF period.

The budget cut was mainly in the Compensation of employees which had an impact on the ability and capacity of the Directorate to carry out its constitutional mandate.
The filling of posts was negatively affected by the budget cuts.

All vacant posts in the establishment were re-prioritised to accommodate the reduction of the budget baseline which resulted in the process of filling vacant posts being put on hold.

• Long distance travel due the vastness of the majority of Provinces.
• The response time to crime scenes is not satisfactory due to the Department not having a footprint in all Provincial Districts.1 3.2.2 Key achievements in the Provinces: • The ability of the Management in the Provinces to manage during a crisis period such as at the peak of the COVID-19 Pandemic.

• The intermittent closure of the offices of IPID and those of key stakeholders due to the pandemic did not deter the Management in Provinces from providing essential services.
• The management in the Provinces being able to sustain its performance in the majority of targets and even exceeding some of the set annual targets for 2020/2021 financial year.

• IPID Hotline was launched on 12 October 2020 to improve access to IPID’s services nationally.

• The Regionalization Model through implementation of the Access and Awareness Rural Strategy.

This allowed IPID to have a bigger footprint by having multiple offices servicing a larger part of each province.
• Collaboration with the National Youth Development Agency (NYDA) with provision of 66 learners who will provide administration support to investigators in all provinces.

1 Please see the table provided in the annexure for the comprehensive list of vacancies.

5 130 3.2.3 Challenges in Provinces: • Increasing workload as compared to 2019/2020.

The intake increased by 482, from 5 640 to 6 122 cases.
• COVID-19 pandemic affecting investigation routine work with temporary closure of offices and quarantine of officials.

• The geographical area of eight (8) of the nine (9) Provinces are vast taking longer to attend to crime scenes and to collect the necessary evidence on cases under investigation.

3.2.4 Case Workload • Total intake of cases for the financial 2020/2021 was 6 122.
• IPID had a total of 11 578 active cases as at the end of the financial year 2020/2021 that were carried over to the current financial.

• Of the 11 578 active cases reported were mainly assault with 7 820, followed by discharge of an official firearm with 1 635, death as a result of police action with 794, torture with 665 and other criminal/misconduct matters at 184 cases.
• Furthermore, IPID has a total of 23 187 Post Decision Monitoring cases, therefore, the actual IPID workload as at the end of March 2021 was 34 765 (active cases and the PDM).

• Five Provinces with the highest workload (both active and PDM) cases are Gauteng with 8 722, followed by the Western Cape with 7 205, KwaZulu-Natal with 5 239, Eastern Cape with 3 762 and Free State with 2 856 cases.2 4.
Annual Performance Plans 2021/22 In 2021/22, the Directorate has 32 performance indicators, of which six are new indicators.

The majority of the 2021/22 performance targets remained unchanged compared to the previous financial year.

The majority of the Investigation and Information Management Programme’s 2 Please see annexure one for a breakdown of cases per province.
6 131 performance targets decreased compared to the previous financial year, which is concerning as this is the Department’s core service delivery programme.

4.1 Programme 1 Administration Purpose: to provide strategic leadership, management and support services to the Department.

Programme 1 has a total of seven (07) output indicators contributing to the attainment of outcomes in the Strategic Plan.

Two (02) new indicators were introduced in line with the Department’s 10-point plan.
a) Percentage implementation of Youth Development Strategy per year.

b) Percentage implementation of Gender Based Violence and Femicide Strategy per year.
Performance Indicator % implementation of ICT Infrastructure Plan per year % implementation of Annual Internal Audit Plan per year % implementation of risk mitigation strategies per year % compliance of SMS financial interests submitted through e-disclosure % vacancy rate per year implementation Percentage Development Strategy per year Percentage implementation of Gender Based Violence and Femicide Strategy per year of Youth Targets 70% 90% 60% 100% 10% 80% (14) 70% (12) 4.2 Programme 2: Investigation and Information Management Purpose: to co-ordinate and facilitate the Department’s investigation processes through the development of policy and strategic frameworks that guide and report on investigations3.
Programme 2 has a total of 13 output indicators that contribute to the attainment of outcomes in the Strategic Plan.

There are no indicators that were introduced or discontinued.

3 Please see attached annexure one for Provincial Interests in the Strategic and Annual Performance Plans of the Department.
7 132 MTEF targets were adjusted for eight (8) output indicators due to challenges related to covid- 19 pandemic, delays in obtaining technical reports, total workload (active and post decision ready cases).

a) Death in police custody, b) Death as A result of police action, c) Rape by police officer, d) Rape while in police custody, e) Corruption, f) Systemic corruption, g) Matters referred in section 28.1(h) and h) section 33.3 matters.
Performance Targets 1) Number of investigations of deaths in police custody that are decision ready 2) Number of investigations of death as a result of police action that are decision ready 3) Number of cases for investigation of the discharge of an official firearm by a police officer that are decision ready 4) Number of investigations of rape by a police officer that are decision ready 5) Number of investigations of rape while in police custody that are decision ready 6) Number of investigations of torture that are decision ready 7) Number of investigations of assault that are decision ready 8) Number of investigations of corruption that are decision ready 9) Number of investigations of other criminal and misconduct matters referred to the directorate in terms of s28(1)(h) and s35(1)(c) of the IPID Act that are decision ready 10) Number of investigations of offences referred to in section 33 of the IPID Act that are decision ready 11) Number of approved systemic corruption cases that are decision ready 12) Percentage of criminal recommendation reports referred to the NPA within 30 days of recommendation report being signed off 13) Percentage of disciplinary recommendation reports referred to the SAPS or MPS within 30 days of recommendation report being signed Targets 2021/22 120 220 370 70 6 80 2000 70 10 5 2 90% 90% 4.3 Programme 3: Legal and Investigation Advisory Services Purpose: to manage and facilitate the provision of investigation advisory services.
Provide legal, civil and labour litigation services.

8 133 Programme 3 has a total of four (04) output indicators contributing to the attainment of outcomes in the Strategic Plan.

There were no changes to the indicators and MTEF targets.
Performance Indicator 1) Percentage of written legal advice provided to the Department within 30 working days of the request 2) Percentage of written legal advice provided to investigators within 2 working days of request 3) Percentage of contracts/service level agreements finalised within 30 working days of the request per year.
4) Percentage of litigation matters referred with instructions to the State Attorney within 10 working days of receipt per year (New) Targets 202/2 70% 95% 90% 100% 4.4 Programme 4: Compliance Monitoring & Stakeholder Management Purpose: Monitor and evaluate the relevance and appropriateness of recommendations made to the South African Police Service and Municipal Police Services in terms of the IPID Act.
Programme 4 has a total of eight (08) output indicators contributing to attainment of outcomes in the Strategic Plan.

The output indicator “Number of engagements held with key stakeholders per year” will cover meetings with stakeholders, station lectures and community outreach events.

Two new indicators were introduced: a) Number of media programmes held per year.

b) Percentage implementation of Access and Awareness Rural Strategy per year.
c) Two existing indicators were reviewed - the method of calculation from a number to a percentage.

d) Percentage of responses from SAPS and MPS that are analysed within 30 days of receipt.

e) Percentage of responses from NPA that are analysed within 30 days of receipt.
Performance Indicators 1) Number of engagements held with key stakeholders per year 2) Number of media programmes held per year 3) Percentage of recommendations referred to SAPS and MPS that are analysed per year 4) Percentage of criminal referrals forwarded to NPA that are analysed per year 5) Percentage of responses from the SAPS and MPS that are analysed within 30 days of receipt per year Target 2020/21 166 4 80% 80% 60% 9 134 6) Percentage of responses from the NPA that are analysed within 30 days of receipt per year 60% 7) Number of case docket inspections conducted per year 8) Percentage implementation of Access and Awareness Rural Strategy per year 5 60% (6) The Department provided the Committee with an update on some of its activities as follows: • It is expected that the amendment of the IPID Act will be finalised in 2021/2022 financial year.
Lack of resources will affect the implementation of amended IPID Act.

• Engagement with Department of Health and Forensic Science Laboratory and Forensic Science Laboratory to fast track technical reports which will assist in completion of investigations.

• The Department will continue relations with key stakeholders such as National Youth Development Agency (NYDA), Community Safety, Investigating Directorate (ID), and others on sharing of resources.

5.
5.

Discussions / Responses by Deputy Minister/ Department 5.1 IPID’s Budget Members were concerned that every year the budget of the Department is always limited.

The Deputy Minister responded that all government departments are experiencing serious economic challenges, as a result of the impact of the Covid-19 pandemic.

As a consequence, there are budget cuts across government as a whole.
The SAPS family has been affected and despite the budget challenges, the Deputy Minister assured the committee that IPID would receive the necessary support to perform its work.

5.2 Culture of Policing Members were concerned about the figures of cases actually investigated and the number of civilians dying, raped and assaulted by police.

Members were concerned that this does not reflect a good human rights culture which should be instilled in police officers when doing their work.
Members wanted to know what is being done to address this culture within the police service.

IPID responded that its work is more reactive than pro-active.

IPID does however have regular engagements with SAPS and makes recommendations of a policy nature on issues which they pick up during investigations, it is then up to SAPS to undertake management interventions.

The Deputy Minister responded by saying that the culture is the responsibility of all in society.
10 135 SAPS is engaged in programmes at colleges where police officials are receiving human rights and constitutional training.

The SAPS is doing everything to ensure that the police service is professionalised and the work of IPID contributes to ensuring that the conduct of police officers remains good.

5.3 Compliance with IPID recommendations Members were concerned about the low compliance of SAPS to the IPID recommendations.
Members wanted to know why disciplinary hearings were not being held and why 88% of the recommendations were incomplete.

IPID responded that the Civilian Secretariat for Police Service Act places an obligation on compliance of this with SAPS.

IPID informed the committee that this matter is discussed during their consultative forum with CSP who then reports to the Minister on issues of non-compliance.
IPID also sends reports to the Minister, Secretary of Police and the National commissioner and there are also engagements which takes place at a provincial level.

IPID does raise concerns regarding compliance so that SAPS can engage in their own disciplinary processes.

5.4 Disciplinary Processes Members were concerned that despite IPID’s recommendations, it was clear that not all police officers who were found guilty were actually dismissed.
Members wanted to know why these police officers have not been dismissed.

IPID responded that they are not directly involved in the disciplinary processes of SAPS.

SAPS conducts disciplinary processes on their own, on some occasions IPID is called as a witness.

IPID is however trying to address some of these concerns in the IPID Amendment Bill in order for IPID to be more involved in the disciplinary processes of SAPS.
5.5 Case Flow Management Members wanted an update on the past challenges that IPID experienced in respect of case flow management.

IPID responded that they are currently busy with a tender for a new system to address these challenges.

5.6 Farlam Commission Recommendations Members wanted to know if the 2015 Farlam Commission of enquiry recommendations on forms to be used by IPID has been implemented and if not, why this has not been done.
IPID responded that this recommendation has not been implemented and that it will be given urgent 11 136 attention with their legal services department.

IPID informed the Committee that the forms currently in use are still the same but that IPID informs suspects of their rights in terms of the Criminal Procedure Act.
5.7 Success rate of IPID - NPA queries and decisions Members wanted to know how IPID minimises queries from the NPA and whether or not they are happy with their success rate in the prosecution of cases.

Members also wanted to understand the main reasons advanced by the NPA when it declines to prosecute a matter.

IPID responded that they analyse the referrals to the NPA and check whether the decision of the NPA is in accordance with IPID’s recommendations.
In most instances, IPID has agreed with NPA decisions.

However, the standard used by the NPA is ‘beyond reasonable doubt’ and therefore in some instances there are no prospects of success for prosecution.

IPID informed the committee that in the instances where the NPA makes a decision to decline to prosecute, they do so without giving reasons.

In the instances where IPID feels strongly that a matter must be prosecuted, they make representations to the NPA to review their decision.
5.8 IPID Office Space Members were concerned that IPID still does not have a budget for office space and were concerned that IPID has been using temporary containers as offices.

Members wanted to know when this will be addressed and what impact it has on the investigation of cases.

IPID responded that they do have proper offices with buildings in all 9 provinces.
However, in some instances they also have satellite offices and are continuously trying to access more offices with MECs and the Department of Justice within provinces.

The office space however has to be looked at in conjunction with capacity in terms of the numbers of investigators.
5.9 Gender Based Violence and Femicide (GBVF) and Youth Development strategy indicators Members requested more information on the GBVF and youth development strategy indicators in respect of implementation and how they will measure the impact thereof.

IPID responded that in terms of the youth development strategy indicator, they are working with the NYDA to implement learnerships to open doors for young persons.
Currently, they have 66 young persons who assist investigators with their administrative tasks.

In respect of the gender based violence and femicide indicators (GBVF), IPID has started launching the programme in the 12 137 Free State Province and on a monthly basis they generate statistics on rape, torture and assault.

These statistics are sent to the President on a monthly basis.
5.10 Reduction of Targets Members were concerned that the majority of targets in the investigation programme has decreased or remain unchanged.

Given the importance of this programme in the work of IPID, members wanted to understand why the targets have been decreased.

IPID responded that during their Strategic Planning Sessions, they had to revisit resources, in respect of the number of investigators, current budget and budget cuts.
In light of this, targets had to be aligned to the budget cuts as IPID cannot commit to more given current constraints.

5.11 Vacancies - Investigators Members were concerned about the high number of vacancies of investigators provincially.

IPID responded that the reprioritisation of posts is being addressed and processes are underway to fill the posts, however they are currently awaiting approval from the Minister.
5.12 IPID Hotline Members wanted to know whether the IPID hotline is increasing reporting and what monitoring mechanisms have been put in place to measure the effectiveness of the Hotline.

IPID responded that the Hotline was only launched in October 2020 and they will give it a year to monitor and measure its effectiveness.

IPID further informed the committee that there is a drive to engage in outreach programmes to encourage reporting of cases in this financial year.
5.13 High Statistics of Assault and Discharge of a Firearm Members wanted to understand why the statistics for assault and the discharge of a firearm was so high.

IPID responded that assault cases are never cut and dry.

In some cases, where members of SAPS are interacting with the public, assault cases are lodged in some instances to deter investigations from the actual crime which has been committed.

Therefore, IPID addresses this on a case by case basis.
6 Recommendations 6.1 Members acknowledged the financial challenges faced by IPID however, members recommended that, despite these challenges, IPID should find pro-active mechanisms to ensure that all cases are investigated effectively.

13 138 6.2 The Department should find innovative ways to strengthen its reach within provinces to ensure that it continues to fulfill its mandate.
6.3 The Department should speed up its implementation of the Farlam Commission of Enquiry recommendations in order to improve the efficacy of its work.

6.4 The Department should continue with regular provincial engagements with SAPS, CSP and the NPA to ensure compliance with its recommendations and to find mechanisms to ensure that the majority of its cases are prosecuted and disciplinary measures are being implemented.
6.5 The Department should continue making the necessary policy recommendations to SAPS to improve and instill a culture of adherence to human rights principles by police officials.

6.6 The Department should work hard towards achieving the targets set for the implementation of the gender based violence, femicide and youth development strategy, as these strategies are critical in the fight against gender based violence, femicide and youth development in South Africa.
6.7 The Department should prioritise the filling of vacancies of investigators across all provinces to increase the investigative capacity within the Department.

7 Conclusion The Committee welcomed the presentations made by IPID and encouraged IPID to continue fulfilling its mandate in conducting oversight over SAPS and MPS and to make appropriate recommendations, as well as to ensure compliance thereof.
The Committee further encouraged IPID to find innovative ways to strengthen its reach within provinces to ensure that it continues to fulfil its mandate.

The Select Committee on Security and Justice supports Budget Vote 24.

Report to be considered.

14 139 ANNEXURE ONE Provincial Interests in Strategic Plan 15 140 Provincial Interest in the Annual Performance Plan 16 141 Cases being investigated - Provincially 17 142 7.
REPORT OF THE SELECT COMMITTEE ON SECURITY AND JUSTICE ON THE 2021/22 BUDGET VOTE 28, ANNUAL PERFORMANCE PLAN (APP) OF THE DEPARTMENT OF POLICE (SAPS), DATED 2 JUNE 2021.

1.

Introduction 1.1.

Introduction and background The National Council of Provinces (NCOP), in terms of section 42(4) of the Constitution, ensures that the provincial interests are taken into account in the national sphere of government.
It contributes to effective government by ensuring that provincial and local concerns are recognised in national policy making and that provincial, local and national governments work together effectively.

One of these functions is to hold the government to account in respect of how the taxpayers’ money is used.

It detects waste within the machinery of government and public agencies.

Thus it can improve the efficiency, economy and effectiveness of government operations.
It is with this in mind that the Select Committee presents this report on the budget briefing by SAPS.

The Select Committee on Security and Justice, on 19 May 2021, held a virtual briefing on the 2021 Budget and APPs of the Department of Police.

The engagement with the Department has taken place within the context of the Covid-19 pandemic which has a bearing on the work of the Department.

2.
Strategic Priorities of the Department of Police for the 2021/22 financial year There are various policy priorities which inform the Departmental strategic plans, APPs and budgets, as discussed hereunder: 2.1 State of the Nation Address (SONA) The Department presented the following eleven (11) SONA priorities that it will be focusing on: 1 143 • Reduce violent Crime by 50% in a decade; • Direct job creation opportunities; • Advancing honesty, ethics and integrity in the public service; • Building a capable and professional civil service; • Improved cooperation and sharing of resources between the respective law enforcement agencies; • Fraud and corruption in the procurement of COVID-related goods and Services; • Cable theft, railway infrastructure vandalism, land invasions, construction site disruptions and attacks on truck drivers hamper economic activity and discourage investment; • Fast-tracking the implementation and capacitation of the Border Management Agency; • Gender-based Violence and Femicide; • Cabinet approved a policy that 40% of public procurement should go to women owned businesses; and • Provide greater opportunities for persons with disabilities to participate in the economy and in society in general.
2.2 National Development Plan (NDP) Chapter 12 titled “Building Safer Communities” is the key chapter outlining the responsibilities of the policing portfolio in South Africa.

The vision of Chapter 12 is that: "In 2030, people living in South Africa feel safe at home, at school and at work, and they enjoy a community life free of fear.

Women walk freely in the streets and children play safely outside.
The police service is well-resourced and professional, staffed by highly skilled officers who value their work, serve the community, safeguard lives and property without discrimination, protect the peaceful against violence, and respect the rights to equality and justice."
To achieve this vision, the NDP sets out five focus areas, including: • Strengthen the criminal justice system; • Make the police service professional; • Demilitarise the police; • Build safety using an integrated approach; and 2 144 • Build community participation in safety.
2019-2024 Medium Term Strategic Framework (MTSF) The MTSF 2019–2024 aims to address challenges of unemployment, inequality and poverty through, 1) driving a strong and inclusive economy, 2) building and strengthening the capabilities if South Africans, and 3) achieving a more capable state.
These underpin the seven priorities of the MTSF – • Priority 1: Economic transformation and job creation • Priority 2: Education, skills and health • Priority 3: Consolidating the social wage through reliable and quality basic services • Priority 4: Spatial integration, human settlements and local government • Priority 5: Social cohesion and safe communities • Priority 6: A capable, ethical and developmental state • Priority 7: A better Africa and world 2.3 Ministerial Priorities In terms of the 2020/21 APP, the Minister has emphasised the following strategic priorities: • The establishment of a capable, ethical and developmental state; • Social cohesion and safe communities; • COVID-19 pandemic has accentuated the role that is required of the SAPS in ensuring that government policy, which is aimed at securing and protecting the people of this country, is implemented; • Crime and its associated violence against women, in particular, will not be tolerated by this Ministry.
• The SAPS will integrate and fast-track SAPS’ efforts with all stakeholders through its Gender-based Violence Action Plan, in support of the GBVF National Strategic Plan; • Unblocking of hindrances to service delivery by the SAPS and to avail the support that is required by police officers in the frontlines; and • The identification, analysis and constructive addressing of specific service delivery- related challenges and encompasses both the operational and support environments within the SAPS.
3 145 2.4 SAPS Priority Areas 2021/22 The Department highlighted the following focus areas for the 2021/22 financial year: • Enhancing community safety; • Reducing violence against women and children; • Targeting fraud and corruption; and • Mitigating the impact of baseline reductions.
2.5 Directorate for Priority Crime Investigation The Directorate for Priority Crime Investigation (DPCI) (commonly known as the Hawks), has also listed their priorities in the 2021/22 APP which includes the following areas: • Continued investigations of COVID 19 related cases (Solidarity Fund); • Truth and Reconciliation Cases; • Clean Audits focusing on Municipalities; • Expediting the recruitment process in order to capacitate the DPCI; • Acquiring of suitable accommodation for the DPCI; • Procuring of Information Technology/Modernisation of systems; and • Expanding on Training.
3.

SAPS Budget Allocation 2021/22 The SAPS received a Main Appropriation of R96.3 billion in 2021/22, which is a nominal decrease of R3.2 billion or 3.2 per cent compared to the previous financial year.

In real terms (inflation considered), the Department’s allocation decreased with R7 billion, or 7.12 per cent.

The largest decrease is in the Department’s core service delivery programme, Visible Policing.
This Programme’s appropriation decreased with R3.8 billion, or 7.24 per cent in nominal terms compared to the previous financial year.

Considering inflation, the Programme’s appropriation decreased with R5.8 billion, or 10.98 per cent.

Despite the decreased allocation, the Programme continues to receive more than half of the Department’s total 2021/22 budget allocation (51.4 per cent).
4 146 The Detective Services Programme received a Main Appropriation of R19.5 billion in 2021/22, which is a nominal decrease of 0.75 per cent and a real decrease of 4.75 per cent.

The Crime Intelligence Programme’s 2020/21 allocation of R4.2 billion decreased with R88.6 million to a Main Appropriation of R4.1 billion in 2021/22, which is a nominal decrease of 2.11 per cent and a real decrease of 6.06 per cent.
The Protection and Security Services Programme received a Main Appropriation of R3.2 billion in 2021/22, which is a nominal percentage decrease of 0.97 per cent and 4.96 per cent in real terms.

Budget Allocation Per Financial Programme Source: SAPS Presentation (19 May 2021) The Administration Programme is the only Departmental Budget Programme that received a slight increased allocation of R929.1 million in 2021/22 compared to the previous financial year.
This is a nominal increase of 4.89 per cent and 0.66 per cent in real terms.

5 147 4.

Provincial Budget Breakdown 4.1 Key Issues related to the Provincial Budget • The baseline budget allocation to provinces for operational types of expenditure (excluding compensation of employees), including overtime provision as well as additional funding for prioritized functions were sustained with an average of 4% increase.
• Provinces received their budget allocations (inclusive of additional priorities) and still have to apportion it between the police stations.

4.2 Provincial Resource allocation • Provinces with the highest incidence of reported crime, have been prioritized in terms of the allocation of baseline budgets and resources.

• The Provinces that have been prioritized are: Gauteng., KwaZulu-Natal, Eastern Cape, Western Cape and Mpumalanga.
• As a result of baseline decreases in the Vote, reprioritization was performed specifically targeting national competencies in order to allow for a 4% average increase on provincial budget allocations.

• The Top 30 High Contact Crime Weight stations in the country have been prioritized in terms of resources, which includes budget allocation.

• Each Province also identifies High Crime Stations and prioritises these Stations.
• Notwithstanding the above prioritisations, additional funding for prominent environments has also been allocated to Provinces, such as Family Violence, Child 6 148 Protection and Sexual Offences (FCS) units, Gender-based Violence (GBV), Safety at Police Stations, etc.

4.3 Specific Budget Allocations for 2021/22 • An amount of R257 million for operational and training purposes has been allocated as a baseline budget.
• R115 million has also been allocated for expenditure associated with trainees undergoing basic police development.

• Recruitment and Filling of Key Vacancies: Substantial budget reductions have been introduced on compensation of employees funding over the MTEF(2021/22,2022/23and2023/24).

• Recruitment in the DPCI and Forensic environments are currently in process.
The Department has allocated ±R1,2 billion on baseline activities related to the GBV and the resourcing of FCS Units: • R1,142 billion on FCS units’ human and other resources, that includes operational expenses.

• R30 million on youth, children and vulnerable groups including awareness campaigns.

• In addition to the above, an additional R100 million has been allocated to provinces for the prioritization of the GBV response and the strengthening of FCS Units.
An amount of R30 million has been allocated in addition to the baseline for the Division: Visible Policing and Operations, for expenditures to be incurred on firearm licensing, destruction and amnesty processes.

• An amount of R62 million has also been allocated to the Division: Technology Management Services, for development of a Firearms Control System.

• An amount of R6 000 000 was allocated for the Firearms Amnesty.
• It is estimated that claims to the value of ±R300 million will be received from the State Attorney’s office for litigation action on behalf of SAPS, for both civil claims and court action brought by SAPS members challenging dismissal/disciplinary action/charges.

7 149 5.

Annual Performance Plans 2021/22 per Programme 5.1 Programme 1: Administration Programme Programme purpose: Develop departmental policy & manage the department, including providing administrative support.
The Administration Programme has identified 21 performance indicators for 2021/22.

There are no new performance indicators and few indicators were amended.

Some of the key performance indicators include: • Number of SAPS-owned firearms reported as stolen/lost: Target to reduce by 10% from 564 to 508 in 2021/22.

• The number of new police stations established, as per the SAPS Infrastructure Development Programme.

The target was increased from two police stations to three police stations in 2021/22.
• The number of mobile contact points procured remains unchanged at 15 in 2021/22 compared to the previous financial year.

• Percentage of learners assessed and declared competent upon completion of specified training in prioritised training areas: Crimes committed against women and children: Target of 97% of learners assessed and declared competent.

• Percentage of IPID-related cases finalised within the prescribed timeframe.
Target remains unchanged in 2021/22 at 90% of cases finalised within 60 calendar days.

• Number of incidents of unauthorised expenditure: Target to record zero incidents of unauthorised expenditure.

In 2019/20, the Department did not report any unauthorised expenditure.

5.2 Programme 2: Visible Policing Programme Purpose: to enable police stations to institute and preserve safety and security, provide for specialised interventions and the policing of South Africa’s borders.
8 150 The Visible Policing Programme has identified 24 performance indicators, with no new performance indicators.

However, the targets of several performance indicators have been reduced and one indicator, namely the establishment of functional strategic partnerships, was removed in the Crime Prevention sub programme.
The Crime Prevention sub programme has 15 performance indicators, some of which includes - • Number of stolen, lost and illegal firearms recovered: The target was reduced from an estimated target of 3 606 to 1 930 in 2021/22, which is ascribed to lockdown levels 5 and 4 during which the movement of persons and goods was severely restricted.

• Number of identifiable stolen/lost SAPS-owned firearms recovered: Target to increase the recovery with 10% to 593 firearms.
• Percentage of applications for new firearm licenses finalised within 120 working days: Target to finalise 90% of applications within 120 working days.

• Percentage reduction in the number of reported contact crimes: The target is set at a reduction of 7.48% over the medium-term.

• Percentage of police stations rendering a victim friendly service to victims of crime, including GBVF: The target remains at 100% of functional police stations.
• Percentage reduction in the number of reported contact crimes against women (18 years and above): The target remained unchanged at a reduction of 6.9%.

• Percentage reduction in the number of reported contact crimes against children (below 18 years): The target remained unchanged at a reduction of 6.73%.

• Percentage of police stations that have functional Community Police Forums: The target remains unchanged at 99.57% (1 148 of 1 152 police stations).
• Number of Provinces in which the Community-in-Blue Concept has been initiated: Target increased from implementation in three provinces to six provinces by 31 March 2022.

• Number of Provinces in which the Traditional Policing Concept has been implemented: In 2021/22, the SAPS will implement the concept in one province.

The Specialised Interventions and Border Security sub programme has nine performance indicators.
The majority of performance indicators in the Border Security sub programme revolve around crime-related hits reacted to because of the Movement Control System (MCS) 9 151 and the Enhanced Movement Control System (EMCS) on wanted persons and circulated stolen or robbed vehicles.
The other performance indicators aim to search 100% of profiled vehicles at land ports, containers at sea ports and cargo consignments at airports for illegal facilitation of persons, contraband, illicit goods and/or stolen/robbed property.
5.3 Programme 3: Detective Services Programme Purpose: to enable the investigative work of the SAPS, including providing support to investigators in terms of forensic evidence & the Criminal Record Centre The Detective Services Programme has 29 performance indicators in total, of which most are located in the Crime Investigations sub programme (14 indicators).

The Crime Investigation sub programme has 14 performance indicators, of which most targets have been increased in the 2021/22 financial year.
Some of the performance indicators are - • Percentage increase in the detection rate for contact crimes: Target increased from 55.47% to 55.7%.

• Percentage reduction of outstanding case dockets related to contact crimes older than 3-years finalised: Target increased from 14.7% to 14.97%.

• Percentage increase in the detection rate for crimes against women (18 years and above): Target increased from 75.15% to 75.25%.
• Percentage increase in the detection rate for crimes against children (below 18 years): Target increased from 70.1% to 70.15%.

• Percentage of identified drug syndicates neutralised with arrests: Target increased from 50% to 60% in 2021/22.

• Percentage of identified organised criminal groups neutralised with arrests: Target increased from 50% to 60% in 2021/22.

• Percentage increase in compliance with the taking of buccal samples from schedule 8 arrested offenders: Target increased from 60% to 70%.
• Percentage reduction of outstanding person-to-crime DNA investigative leads finalised.

The target was increased significantly from an estimated performance of 5% in 2020/21 to 17% in 2021/22.

10 152 • Percentage reduction of outstanding Integrated Ballistics Identification System (IBIS) investigative leads finalised: Target increased significantly from 5% to 13.3%.
The Criminal Record Centre and Forensic Science Laboratory sub programme has seven performance indicators to improve the processing of fingerprint searches and maintenance of criminal records, and to enhance the processing of forensic evidence and forensic intelligence case exhibits.

None of the targets was increased in 2021/22 compared to the previous financial year.

The Directorate for Priority Crime Investigation, Sub-programme: Specialised Investigations has seven performance indicators.
All targets related to reducing levels of serious corruption in the public and private sectors in order to improve perceptions of fraud and corruption were increased in 2021/22 compared to the previous financial year.
5.4 Programme 4: Crime Intelligence Programme Purpose: to manage crime intelligence and analyse crime information and provide technical support for investigations and crime prevention operations The Crime Intelligence Programme has 12 performance indicators to enable intelligence-led policing, effectiveness of counter-intelligence measures instituted by the SAPS and enhanced external cooperation and innovation on police reform and security matters to prevent and fight crime.
The conducting of security assessments, including the vetting of members, is one of the most basic defensive measures in the protection of classified and confidential information and counter-intelligence strategies.

However, the targets for the 2021/22 performance indicators were reduced significantly - • The target for the completion of security clearances finalised, in relation to the total planned annually was reduced from 100 per cent to 50 per cent (577 from 1 154) in 2021/22.
• The target for the percentage of ICT security assessments finalised in relation to the total planned annually was reduced from 100 per cent to 50 per cent (1 185 from 2 370) in 2021/22.

• The target for the finalisation of mandatory physical security assessments finalised was revised to specify that these assessments are “overt”, thus done openly.
11 153 In terms of the above, a key performance indicator measuring the Percentage of security awareness programmes conducted in the SAPS was removed and not included in the 2021/22 APP.
5.5 Programme 5: Protection and Security Services Programme Purpose: to provide a protection and security service to all identified dignitaries and government interests The Programme has four sub programmes as per the budget, but the performance indicators are delineated into only two sub programmes, namely the Protection and Security Services sub programme and Presidential Protection Services sub programme.
The other two sub programmes Government Security Regulator and Operational Support, have no performance indicators assigned to them despite the sub programmes receiving a budget allocation.

The performance indicators of the Protection and Security Services sub programme aim to have zero security breaches during in-transit protection and at identified government installations and identified VIP residences.
The sub programme further measures the percentage of strategic installations audited (49 per cent/122 of 249) and evaluation of National Key Points (NKPs), targeted at 100 per cent (209 evaluations).

6.

Discussion / Responses by the Deputy Minister and the Department 6.1 Visible Policing vs Compensation of Employees Budget Members were concerned about the visibility of police given that there is a budget cut in this programme and yet compensation of employees is still relatively high.
The National Commissioner responded that the Department is in a process of scaling down the compensation budget via a stabilisation and restructuring process.

The Department is further scaling down senior manager posts.

These posts have been frozen and the budget for the frozen posts are being used to recruit those at lower levels.

The Department is therefore working to bring the figure down but not the amount of people being employed.
12 154 6.2 Firearms Amnesty Budget Members wanted to understand why the Amnesty budget is R6 million and what the amount is used for.

The Department responded that there is an expenditure of just over R300 million for advertising and marketing to promote awareness for the amnesty.

An amount of R1 587 945, which was budgeted for Advertising and Marketing, but not spent, was reprioritized to Capital Expenditure.

The shortfall amount of R991 505 was not utilized and was returned to the Fiscus.
6.3 Firearms Licence Renewals Members were concerned about the backlog in finalising Firearms Licence applications and indicated that some people wait more than 300 days for the renewal of their licences.

The Department responded that they are prioritising licenses that are overdue and that they have implemented action plans to address licences that have not been renewed for over one year.
The Department is holding stakeholder meetings with colleagues internally to fast track the applications and are targeting the end of June 2021 for finalisation.

6.4 Dysfunctional Police Stations Members were concerned that there were police stations that were empty and not being utilised, particularly in the North West Province.

In addition, there are also police stations that are under staffed and under resourced, particularly in rural areas.
The National Commissioner responded that the Department has established an integrated resource committee comprising of senior managers.

The aim of this committee is to drive migration of resources to police stations and correct the formula of distribution of resources particularly to rural police stations under the rural safety strategy and to allocate sufficient budget for rural safety.
The Department responded that the police stations that were not operational in the North West were three (3) out of six (6) and the challenges arose out of the suppliers who failed to complete their work and the court processes that flowed from this.

The Department however assured the committee that this situation is being monitored at national level and stations are prioritised and will be operationalised soon.
6.5 Police officials - Sick leave due to stress Members raised their concerns regarding police officials who were on lengthy sick leave due to stress and were unable to work as a result thereof.

The Department informed the Committee that there is an employee wellness programme and they have pro-active and reactive programmes for members to assist the members to cope with the stress in the environment.
The 13 155 Department also has a health risk manager who gives advice on when members need to be boarded off as a result of ill health.

All provinces are required to monitor the situation of members who are on sick leave for long periods of time.

6.6 Compliance with IPID recommendations Members were concerned about SAPS reluctance to discipline police officers even though such recommendations were made by IPID.
Members wanted to know why SAPS has not responded to findings, why the Department is not disciplining officers and why the sanctions which are being imposed are so low for serious transgressions.

The Department responded that they have formalised the establishment of a conduct committee which looks at the outcomes of disciplinary processes.

In the event that the outcomes are not satisfactory, the disciplinary process is taken on review.
The Department further indicated that they have a good working relationship with IPID and CSP at provincial and head office level.

Mandatory meetings are conducted to share information and update each other on the outcomes of cases.

Some challenges exist due to their utilisation of their own personnel to deal with disciplinary matters and due to the police officials prioritisation of their own work above disciplinary hearings, delays occur.
However, the conduct committee will now address these challenges as it will be a dedicated committee addressing disciplinary matters.

6.7 Corruption Members were concerned that at grassroots level, police officials are involved in corrupt activities and there seems to be no improvement in respect of dealing with corruption.

The Department responded that they have implemented a clean-up campaign to address the matter of members of SAPS who are involved in crime.
The Department informed the Committee that there are members who have been arrested including junior and senior members.

The Department emphasised the fact that it does not tolerate contamination within the SAPS and has further put measures in place to motivate those who are doing good work.

6.8 Vehicles Members raised a concern that the matter related to vehicles not being operational is a recurring issue which has not been addressed.
One member proposed that SAPS should consider establishing its own garage to ensure that vehicles are fixed timeously.

The Department acknowledged that this is a challenge because more vehicles are in garages than at the police stations.

The Department is currently reviewing various ways to ensure that more vehicles are 14 156 operational and they are implementing a turnaround strategy.
The Department has also requested assistance from the PC Police to provide support to request that the infrastructure for garages be devolved to SAPS because it is currently dealt with by DPW.

The Department indicated that they will incorporate the member’s suggestion of establishing its own garage into their turnaround strategy to have more operational vehicles.

6.9 Gangsterism in Klerksdorp (Matlosana) Members noted that 3 weeks ago the Deputy Minister visited the area to address gangsterism.
Members noted that gangs have hijacked the city and act with impunity and connive with officials and that this has escalated in the last few months.

SAPS needs to have a strategy to address gangsterism within Matlosana in the North West Province.

The National Commissioner indicated that the necessary support will be provided to the Provincial Commissioner to ensure stabilisation within the North West Province.
The Department has a Gang strategy which includes prevention and combatting gangsterism, which includes work with the DPCI.

The Provincial commissioner informed the committee that work is underway to address this matter and that they have arrested some gang members for murder, arson and other crimes.

In addition, one member has been dismissed during April 2021.

Two (2) cases are upcoming and the one accused will appear on 24 May 2021 and the other on 31 May 2021.
6.10 Economic Crimes Members wanted to understand the role of SAPS in the task teams set up to address economic crimes.

The DPCI responded that within DPCI there are three (3) legs which mostly covers operational serious economic crime, corruption and commercial crime.

The DPCI has established teams to arrest officials within municipalities and in government departments.

6.11 Building of new police stations Members wanted information on the APP target for the building of three (3) new police stations.
Members wanted to know where they will be built and what informed the decision to build 3 police stations.

The Department informed the committee that 2 police stations would be built in North West Province and 1 in the Northern Cape Province and that the stations were close to completion in these provinces.

The Deputy Minister informed the committee that the building of police stations is on a national priority list which cuts across all nine provinces.
The police stations are therefore built according to the national priority list.

15 157 6.12 Irregular Expenditure Members wanted to understand what measures the Department would put in place to reduce irregular expenditure and what practical steps would be implemented to cap irregular expenditure.

Members also wanted to know what steps would be put in place for those implicated in wrongdoing and whether they would be subjected to disciplinary action.
The Department responded that they have put in place a prevention dimension to address this matter.

The Department has ordered a total review of the framework and risk management which has been aligned to provide a response to capping irregular expenditure.

The Department has further invoked the relevant provisions of the PFMA to address this matter which is complemented by the disciplinary code of SAPS.

The Department has further appointed a risk officer and declared irregular expenditure as high risk.
The Department has embarked on roadshows across all provinces and developed a pocket book for easy access for members.

The Department has embarked on a cleaning up campaign to assess adherence to protocols in terms of procurement, some members have been arrested and 7 members have been dismissed.

6.13 Police Reservists Members were concerned that police reservists work for SAPS for many years without receiving remuneration for the services which they render.
One member was concerned about some reservists in Pinetown who had undergone training but were not employed as reservists.

The Department informed the Committee that reservists fall under the visible policing programme and they are strictly deployed and paid according to this policy.

The Department emphasised that if any reservist was not being treated fairly according to their policy, they would address the matter.
The Department explained that the function is when a member of the community applies to be a reservist and it is a voluntary service, however through the intervention of the Department, members have been sent to police academies for training and they are prioritised.

Reservists are used for major events and they receive the necessary payments for their services.
In the event that reservists have failed tests or are excluded, the Department always furnishes them with reasons for exclusion and there is an appeals procedure for such matters.

The Deputy Minister encouraged the member who had mentioned the Pinetown reservist’s grievances to submit the details to the Department for follow up.
6.14 Gender Based Violence and Femicide (GBVF) and Family Violence, Child Protection and Sexual Offences (FCS) units 16 158 Members noted that R1.2 billion was budgeted for GBVF and an additional budget allocation of R100 million would be allocated to provinces.

Members requested that a detailed implementation plan and report be submitted to the Committee on the implementation of the GBVF and FCS budgets.
The Deputy Minister agreed that the detailed report and plan of the Department will be submitted to the Committee.

6.15 Stock Theft and Rural Safety – Eastern Cape Province Members wanted to understand what measures have been put in place in respect of stock theft and contact crime within rural communities.
The Eastern Cape was highlighted as an area that has mountainous terrain which may hinder policing efforts to address crime and members were keen to understand the measures that SAPS would employ in this area in particular to address stock theft and crime.

The Department responded that stock theft is a priority for SAPS in rural communities.

The Department indicated that the Eastern Cape will be declared as an area for stabilisation and the necessary support would be provided to the province.
The Department informed the committee that the rural safety strategy and traditional policing policy will be utilised to focus on the challenges highlighted for Port St Johns in the Eastern Cape.

In respect of addressing the high numbers of contact crime in the area, the Department acknowledged that it had some challenges entering deep rural areas at night due to poor visibility and it is for this reason that they are proposing ‘drone policing’ for rural areas, particularly at night.
6.16 Personnel Indaba During last year’s budget briefing the Department had informed the Committee it is embarking on a personnel indaba to address staffing challenges by implementing a strategy to recruit those from school, clerks internally and reservists who were given an opportunity to reapply.

Members requested feedback on this matter.


The Department informed the committee that a recruitment indaba was held in the last year at its head office and the recommendations assisted SAPS with strengthening their requirements.

The first stream consisted of graduates, the second stream consisted of reservists and the last stream of matriculants.

The Department advertised 7000 posts, however due to the Covid-19 pandemic, the Department was only able to implement 2000 plus reservists.
6.17 Community Policing Forums In the previous year’s budget hearings members wanted to know how the Minister would integrate CPFs into the budget as they play a critical role in communities and often work on a 17 159 voluntary basis.

The National Commissioner committed to escalate it to the Civilian Secretariat for Police Service (CSP) in order for SAPS and CSP to deal with the matter collectively.

Members requested an update on this matter.


The Department informed the committee that there is a budget for CPFs which is designed and operationalised as part of the community policing strategy.

Members were encouraged to engage the CSPS further on the budget for maintenance of structures.
6.18 The Directorate for Priority Crime Investigation (DPCI) During the previous year’s budget hearings, members requested information on the progress made with the specialized unit dealing with cybercrimes and narcotics.

The DPCI responded that the capacitation of units in respect of firearms, narcotics and cyber- crimes is limited.

The intention has been to recruit more people and the process of recruitment has already begun, but the process was delayed due to Covid-19.
Members indicated they wish to receive an update on how this is being addressed by DPCI and whether all the necessary capacity has been found and what challenges still exist.

The DPCI responded that the process for recruitment in respect of cybercrimes and narcotics has started in earnest.

The DPCI is currently shortlisting candidates in order to recruit 274 people to fill the positions.
Upon completion of this recruitment process, they will re- advertise 55 posts which were withdrawn to seek specialists in cybercrimes investigation.

Thereafter, 197 posts will then be advertised to fill senior management posts.

The DPCI has recruited 102 contract workers who commenced their employment on 1 April 2021 to target the Truth and Reconciliation Commission (TRC) case backlog.
The DPCI is currently operating at 48% capacity, however they informed the committee that they are making every effort to operate at reasonable capacity.

6.19 DNA Testing Backlogs Members wanted to understand the challenges the Department is experiencing in relation to the backlog of DNA testing and the measures being implemented to address this.

The Department informed the committee that it is working on an integrated recovery plan, particularly aimed at addressing GBVF cases.
The Department is also working with the NPA on all cases which were withdrawn due to outstanding DNA.

The Department has implemented an 18-month project plan which includes contact management, procurement and maintenance of equipment.

18 160 7.

Recommendations 7.1 The Department should, within 30 days of the adoption of the report by the Committee, send a detailed GBVF and FCS implementation plan to the Committee.
7.2 The Department should continue interaction and engagement between members of the Committee and Provincial Commissioners to ensure that provincial matters are addressed by SAPS.

7.3 The Department should investigate obtaining its own garages for vehicles which is independent of DPW to ensure that there are sufficient operational vehicles for policing across all provinces.

7.4 The Department should urgently prioritise addressing the backlog of the renewal of firearm licences.
7.5 The Department should urgently address corruption and take action against those members involved in corrupt activities.

Strong and decisive action by SAPS against corruption will send a strong message to those committing crimes within the Department and will serve to instil public confidence in the SAPS.

7.6 The Department should furnish the Committee with the relevant Provincial budgets when apportioning has been concluded by Provinces (after the1st quarter).
7.7 The Department should implement a focused strategy to address gangsterism in Matlosana in the North West Province and members welcomed the support offered by the National Commissioner to the Provincial Commissioner within the Province.

Members requested that SAPS furnish the committee with a report on the mechanisms that will be employed to address gangsterism and counter corruption in Matlosana within 30 days of the adoption of the report by the Committee.
7.8 The Department should consider implementing ‘drone policing’ as a measure to address high levels of contact crime within the Eastern Cape Province and in rural areas generally.

This measure may go a long way in addressing the current policing challenges in addressing crime in rural areas.

7.9 The Department should speed up its recovery plan to address the backlogs in DNA testing, particularly as it relates to GBVF cases.
19 161 7.10 The DPCI should move swiftly to recruit the required specialist expertise and personnel to carry out its cybercrimes and narcotics investigations.

8.

Conclusion The Committee encouraged the Department to find innovative ways to ensure that the important services which it delivers is not compromised significantly due to budget cuts.
The Department was encouraged to continue working towards decreasing crime, addressing gangsterism and working towards the eradication of gender based violence and femicide.

The Committee indicated that it would continue with its oversight work based on the key issues raised in the deliberations.

SAPS was encouraged to continue to strengthen the relationships between members of the Committee and Provincial Commissioners to work towards resolving provincial concerns.
The Select Committee on Security and Justice supports Budget Vote 28.

Report to be considered.

20 162 8.

Report of the Select Committee on Security and Justice on the Draft Notice on the Determination of Remuneration submitted in terms of section 2(3)(a) of the Judges’ Remuneration and Conditions of Employment Act, 2001 (Act No 47 of 2001), determining the rate at which salaries are payable to Constitutional Court Judges and Judges annually, dated 2 June 2021.
The Select Committee on Security and Justice, on 26 May, received a briefing on the Draft Notice on the Determination of Remuneration.
The Select Committee, having considered the Draft Notice on the Determination of Remuneration submitted in terms of section 2(3)(a) of the Judges’ Remuneration and Conditions of Employment Act, 2001 (Act No 47 of 2001), determining the rate at which salaries are payable to Constitutional Court judges and judges annually with effect from 1 April 2020, referred to it on 29 April 2021, recommends that the Council approve the Draft Notice on the Determination of Remuneration as tabled.

Report to be considered.


163 9.

Report of the Select Committee on Security and Justice on the Draft Notice on the Determination of Remuneration tabled in terms of section 12(3) of the Magistrates Act, 1993 (Act No 90 of 1993), determining the rate at which salaries are payable to magistrates annually, dated 2 June 2021.

The Select Committee on Security and Justice, on 26 May 2021, received a briefing on the Draft Notice on the Determination of Remuneration.
The Select Committee on Security and Justice, having considered the Draft Notice on the Determination of Remuneration in terms of section 12(3) of the Magistrates Act, 1993 (Act No 90 of 1993), determining the rate at which salaries are payable to magistrates annually with effect from 1 April 2020, referred to it on 29 April 2021, recommends that the Council approve the Draft Notice on the Determination of Remuneration as tabled.

Report to be considered.

164 10.
Report of the Select Committee on Cooperative Governance, Traditional Affairs, Water, Sanitation and Human Settlement on 2021/2022 Annual Performance Plan and Budget Vote 33 of the Department of Human Settlements: dated 1ST June 2021 The Select Committee on Cooperative Governance and Traditional Affairs, Water, Sanitation and Human Settlement having considered Budget Vote 33: Department of Human Settlements, the strategic plans for the MTEF period and the 2021/2022 Annual Performance Plan of the Department of Human Settlements reports to the National Council of Provinces as follows: 1.
Background and Introduction 1.1.

The Money Bills Amendment Procedures and Related Matters Act (2009) empowers Parliament to recommend, reject or amend budgets of National Departments and Organs of State.

The Act also enjoins Committees of Parliament to compile and adopt Budget Vote Reports, based on interactions with the relevant Departments - and Entities reporting to them - on their Strategic Plans, Annual Performance Plans and Budgets.

1.2.
1.2.

On the 28 May 2021 the Select Committee on Cooperative Governance and Traditional Affairs (Water, Sanitation and Human Settlement) had virtual meeting with the Department of Human Settlement to consider the 2021/2022 Annual Performance Plan and the budget allocation.

1.

Briefing on 2020/2021 Annual Performance Plan and Budget Vote of the Department of Human Settlement 1.1.
The Department of Human Settlement briefed members on 2020/2021 Annual Performance Plan and Budget allocation as aligned with the five- year Strategic Plan and Medium Term Strategic Framework and 2020 State of the Nation Address.

The presentation focused on departmental programmes such administration; Integrated Human Settlements Planning and Development; Informal Settlements; rental and social housing and affordable.

Housing.
Housing.

Each of these prgrammes are discussed in terms output; outcome indicators and budget allocation for the financial period 2021/2022 2.

Programme 1: Administration 2.1.

The purpose of Programme 1 (Administration) is to provide strategic leadership, management and support services to the Department.
Over the medium term, this programme will contribute to the performance of the Department through the provision of effective and efficient administrative services 1 165 to the line function to implement policies and programmes aimed a delivering sustainable human settlements.

2.2.

This programme is subdivided into number of sub-programmes.

These include the Ministry, Departmental Management, Corporate Services, Property Management and Financial Management 2.3.
Some of the planned departmental output indicators for this programme during this financial year include, attainment of unqualified audit opinion with no matters of emphasis; 100 % compliance with statutory tabling and prescripts; 100% Implementation of the approved internal audit plan; 100% implementation of the approved anti-fraud and corruption plan ; 100% implementation of the approved risk management plan; 100% implementation of the Human Resource Plan ; reports on the development of legislation as per Legislative Programme and approved ICT implementation plan as well as the communication strategy .
2.4.

The total budget for Programme 1 has increased from R 483.4 million in 2020/21 to R488.4 million in 2021/22, representing a real decrease value of 3.04%.

3.

Programme 2: Integrated Human Settlement Planning and Development 3.1.
The purpose of Programme 2 (Integrated Human Settlements Planning and Development), is to manage the development of policy, planning and research in the creation of sustainable and integrated human settlements, to oversee the delivery of the integrated residential development programme, and to coordinate intergovernmental partnerships with stakeholders.

3.2.
3.2.

The main output indicators planned for 2020/2021 financial years include completion of researches on Agri-village and rainwater harvesting and exemption of Holding cost for state land earmarked for housing development; development of a draft Property Transactional Support Centres (PTSC) and Informal settlements upgrading macro policy 3.3.
The other output indicated planned by the department include monitoring of budget allocated to entities owned by designated groups; approval of 2022/23Human Settlements Grants Framework; assessment of human settlements grants (HSDG & USDG); implementation of the Human Settlements Capacity Assembly programme (IHSPDP); and development of 2022/23 National Human Settlements Development Plan 4.

Programme 3: Informal Settlements Upgrading 2 166 4.1.
The purpose of Programme 3 is to provide for policy, planning and capacity support for the upgrading of informal settlements, and to oversee the implementation of the informal settlements upgrading programme.

From 2021/22, informal settlements projects will be funded from the newly created Informal Settlements Upgrading Partnership Grant (ISUPG).

The provincial allocation to the grant amounts to R12.3 billion over the medium term and the allocation for metropolitan municipalities amounts to R12.5 billion.
4.2.

These grants are expected to be used to upgrade and formalise 300 settlements in each year over the medium term and deliver 180 000 stands with access to municipal services.

Spending under Programme 3 is therefore expected to increase at an average annual rate of 143%, from R648.2 million in 2020/21 to R9.3 billion in 2023/24.

4.3.
4.3.

In terms of the output indicators, the Department has planned to complete two rresearch reports on informal settlements upgrading; develop of policies on Social Facilitation and empowerment of designated groups; complete UISP baseline evaluation study and; implement the UISP Capacity Assembly Programme 5.

Programme 4: Rental and Social Housing 5.1.


The purpose of Programme 4 is to promote the provision of affordable rental housing, monitor the performance of the Social Housing Regulatory Authority, and develop capabilities in the rental housing sector through intergovernmental collaboration and evidence-based research 5.2.
The primary objective of this programme is to promote the delivery of affordable rental housing by conducting research and developing policies and programmes as and when required, accelerate the provision of affordable rental housing and to strengthen cooperation and collaboration by facilitating intergovernmental forums and stakeholder partnerships on an ongoing basis.

5.3.
5.3.

Some of the planned outputs and performance indicators include development of policy framework on Rental Housing; monitoring of implementation of projects under Rental Housing Programme; completion of evaluation study on Rental Housing Tribunals; implementation of the Human Settlements Capacity Assembly Programme.

6.

Programme 5: Affordable Housing 6..1.


The purpose of Programme 5 (Affordable Housing), is the provision of affordable housing finance, monitor market trends, to develop research and policy that respond to demand and to oversee housing finance entities that report to the Minister 3 167 6.2.
Key objectives of the programme include acceleration of affordable housing finance through provision of capital and operational funding to the National Housing Finance Corporation for the administration of the Finance-Linked individual subsidy programme; research and development of policies and programmes that promote the provision of affordable financing or households 6.3.
Some of the planned outputs and performance indicators include completion of one (1) research report on Affordable Housing: completion of feasibility of Mortgage Default Insurance; development of One (1) policy on affordable housing; completion of evaluation study on affordable housing and; implementation of the Human Settlements Capacity Assembly Programme 7.

Budget Allocation for the 2021 MTEF 7.1.

This section provides information of budget allocation for 2021 financial year.
The focus is on human settlement development; informal upgrading; urban settlements development; and informal upgrading grants per provinces and municipalities as well as METF budget allocation per economic classification Table 1: Informal Settlement Upgrading Grant Provinces R`000 2021/22 2022/23 2023/24 EASTERN CAPE 432 428 458 151 478 343 FREE STATE 228 001 241 563 252 209 GAUTENG 1 109 179 1 175 155 1 226 950 KWAZULU-NATAL 714 375 756 868 790 226 LIMPOPO 254 336 269 465 281 341 MPUMALANGA 259 233 274 653 286 758 NORTHERN CAPE 76 709 81 272 84 854 NORTH WEST 358 028 379 324 396 042 WESTERN CAPE 457 429 484 638 505 998 Total 3 889 718 4 121 089 4 302 721 Table 2: Urban Settlement Development Grant Provinces Metros 2021/22 2022/23 2023/24 EASTERN CAPE Buffalo City 499 705 496 166 518 034 4 168 Nelson Mandela 593 145 588 945 614 902 Sub Total 1 092 850 1 085 111 1 132 936 FREE STATE Mangaung 495 267 491 760 513 434 GAUTENG Ekurhuleni 1 291 347 1 282 202 1 338 713 Jo'burg Tshwane 1 213 099 1 204 509 1 257 596 1 051 557 1 044 111 1 090 129 Sub Total 3 556 004 3 530 821 3 686 438 KWAZULU-NATAL eThekwini 1 288 158 1 279 036 1 335 408 WESTERN CAPE Cape Town 972 431 965 545 1 008 100 Grant Total Table 3: Municipalities Informal Settlement Upgrading Grant 7 404 711 7 352 273 7 676 316 Provinces Metros 2021/22 2022/23 2023/24 EASTERN CAPE Buffalo City 266 258 282 122 294 556 Nelson Mandela 316 045 334 876 349 635 Sub Total 582 303 616 998 644 191 FREE STATE Mangaung 263 893 279 617 291 940 GAUTENG Ekurhuleni 688 066 729 065 761 197 Jo'burg Tshwane 646 375 684 888 715 075 560 301 593 685 619 851 Sub Total 1 894 742 2 007 638 2 096 123 KWAZULU-NATAL eThekwini 686 369 727 265 759 318 WESTERN CAPE Cape Town 518 140 549 012 573 210 Total 3 945 447 4 180 530 4 364 782 5 169 Urban Settlements Development Grant 7 404 711 7 352 273 7 676 316 22 433 300 Total allocation R`000 Departmental Operational Compensation of employees Goods and services Payment for Capital assets Grants and transfer payments Grants Human Settlements
 Development Grant Informal Settlements Upgrading Partnership Grant Provinces Provincial Emergency Housing Grant Informal Settlements Upgrading Partnership Grant Municipalities Municipal Emergency Housing Grant Entities Social Housing Regulatory Authority: Operational Social Housing Regulatory Authority: Institutional Investment Social Housing Regulatory Authority: Consolidated Capital grant Community Schemes Ombuds Services National Housing Finance Corporation: FLISP National Housing Finance Corporation: FLISP support Housing Development Agency Departmental Transfers Bursaries Scheme UN Habitat City Alliance Total 2021/22 2022/23 2023/24 Total Table 4: MTEF Budget allocation per Economic Classification 8.
Observations of the Select Committee 8.1.

The Select Committee has noted that the revised 2020/25 Strategic Plan and 2021/22 Annual Performance Plans were approved by the Executive Officer and tabled in Parliament on the 15th of March 2021.

The Department has finalized and approved its 2021/22 Annual Operational Plan in line with the Revised Framework for Strategic Plans and Annual Performance Plans.

6 170 8.2.
6 170 8.2.

The Select Committee has also noted that the Cabinet has introduced total budget cuts of the Department of Human Settlement amounting to R486.9 million over the 2021 MTEF period.

The compensation of employees was cut by R188.3 million over the 2021 MTEF period.

Goods and services was cut by R100 million over the 2021 MTEF period.

The Social Housing Regulatory Authority: Operational was cut by R13.7 million over the 2021 MTEF period of which R107 000 is on compensation of employees 8.3.
The Social Housing Regulatory Authority: Institutional Investment was cut by R4.3 million over the 2021 MTEF period.

The National Housing Finance Corporation: FLISP Capital was cut by R89.3 million over the 2021 MTEF period.

The Community Schemes Ombudsman Services: Operational was cut by R4.8 million over the 2021 MTEF period of which R246 000 is on compensation of employees.

The Scholarship Programme of the Department was cut by R2.3 million over the 2021 MTEF period 8.4.
Though the 2021/2022 Departmental Annual Performance Plan and Budget allocation was welcomed, the Select Committee however, raised concerns related to incomplete housing projects, non- communication with the Buffalo Municipality on the accreditation process and outcomes, backlogs of titled deeds, slow process of filling vacant positions of board members of the Public Entities accounting to the department , increased budget allocation for the utilization of consultants, monitoring of quality of houses built before 1994 and post 1994, lack of integrated approach to human settlement that takes into account the provision of housing, clinics, schools and other social amenities .
9.

Recommendations of the Select Committee 9.1.

The Department of Human Settlement should provide the Select Committee with the provincial breakdown of titled deeds in the municipalities 9.2.

The Department of Human Settlement should investigate and provide support to Matlosana Local Municipality on the problems relating to completion of housing projects including the company that has been contracted to provide the services and also provide support to Batloung Local Community in North West Province 9.3.
The Department of Human Settlement should fast-track the process of filling vacancies of members of the board servicing in Public Entities accounting to the Department 9.4.

The Department of Human Settlements should provide timeframes on all the planned research as contained in departmental programmes and performance indicators 9.5.
The department of human settlement should fast-track the accreditation process so as the enable Metro Municipalities to effective and efficiently implement to Urban Settlement Development Programmes and utilization of grants 7 171 9.6.

The Department of Human Settlement should provide quarterly reports on the progress and challenges relating to the achievement of the performance indicators contained in the 2021/2022 Annual Performance Plan and MTEF budget allocation 9.7.
The Select Committee should as part of ensuring executive accountability and performing oversight, aligns its 2021 parliamentary programme with the outputs and performance indicators of the 2021/2022 Annual Performance Plan of the Department of Human Settlement 9.8.
The Select Committee should during the 2021 financial period conduct proactive oversight visits to selected provinces in order to monitor the implementation and completion of the housing projects and the titled deeds in the local municipalities Report to be considered 8 172 11.

Report of the Select Committee on Education and Technology, Sport, Arts and Culture on Budget Vote 16: Basic Education, dated 02 June 2021.
The Select Committee on Education and Technology, Sport, Arts and Culture having considered Budget Vote 16: Basic Education, together with the Basic Education 2020/21 – 2024/25 Strategic Plan and 2021/22 Annual Performance Plans of the Department of Basic Education and its Statutory Bodies, reports as follows: 1.
Introduction 1.1 The Portfolio Committee on Basic Education and Select Committee on Education and Technology, Sport, Arts and Culture, considered the 2021/22 Annual Performance Plan (APP) and 20/21 – 2024/25 Strategic Plan of the Department of Basic Education on Wednesday, 17 March 2021 as well as the review of its two statutory bodies i.e.

the South African Council for Educators (SACE) and the Council for Quality Assurance in General and Further Education and Training (Umalusi) on Friday, 7 May 2021.
1.2 The budget review briefings served to acquaint the 6th Parliament Committees with the mandates, programmes and priorities of the Department.
1.3 Those that appeared before the two Committee during the Budget Review sessions included the following: 1.3.1 Department of Basic Education (DBE): Hon A Motshekga: Minister of Basic Education, Hon M R Mhaule: Deputy Minister of Basic Education, Mr H M Mweli: Director-General, Mr P R M Khunou: Chief Finance Officer, Mr S G Padayachee: Deputy Director-General, Dr G Whittle: Deputy Director-General, Dr S Simelane: Acting Deputy Director-General, Ms C Nuga-Deliwe: Chief Director, Mr D Ntloana: Director, Ms S Mbonambi: Director, Dr F Kumalo: Acting Chief Director, Ms Z Sattar: Personal Assistant, Mr S Mabua: Advisor, Ms S Ramohapi, Ms S Geyer: Director, Mr E Mhlanga: Chief Director, Mr D Van Der Westhuijzen: Director, Ms L Matshaba, Ms N Molai: Director, Ms T Mohlala: Parliamentary Liaison Officer, Mr L Mahada: Director , Ms L Carolissen: Liaison Officer, Ms S Lubisi: Liaison Officer and Mr M Matthews: Liaison Officer.
173 1.3.2 South African Council for Educators: Ms E Mokgalane: Chief Executive Officer, Mr M Mapindani: Chief Finance Officer, Mr B Bushe: SACE Head, Ms Y Lechaba: SACE Head, Mr M Rakgoale: Communications Assistant Manager, Ms J Boikanyo: Communications Assistant Manager, Ms L Twala: Assistant Manager Research and Mr T Njongo: Assistant Manager.
1.3.3 The Council for Quality Assurance in General and Further Education and Training (Umalusi): Dr M Rakometsi: Chief Executive Officer, Mr H van der Walt: Chief Finance Officer, Mr E Sibanda: Executive Manager, Mr D Maluleke: Senior Manager, Mr L Ditaunyane: Senior Manager and Ms M Madalane: Senior Manager.
1.4 This report gives a brief summary of the presentation made by the Department of Basic Education (DBE) to the Committees, focusing mainly on the Department’s 2021/22 Annual Performance Plan, the 2020 Medium Term Expenditure Framework (MTEF) allocations, and the overview of allocations per programme.

The report also provides the Committee’s key deliberations and recommendations relating to the Vote.
1.5 Copies of all presentations on the Budget Review of the Department of Basic Education (DBE), SACE and Umalusi were available from the office of the Committee Secretary.

2.
2.

Department of Basic Education (DBE) Overview of the Annual Performance Plan (APP) for 2021/22 2.1 Strategic overview by the Department of Basic Education (DBE) The Minister of Basic Education, Hon A Motshekga, Deputy Minister Hon M R Mahaule and the Director-General, Mr H Mweli led a delegation from the DBE to present on the 2021-22 Annual Performance Plan and the Budget of the Department of Basic Education.
2.1.1 Background and Context - The Joint Committees was presented with some background and context to the 2021-22 Annual Performance Plan (APP).

The Annual Performance Plan (APP) sets out what the Department intends doing in the financial year and during the Medium-Term Expenditure Framework (MTEF) period to implement its 1 174 Strategic Plan.

In fulfilling its legal obligation, the Department must produce and table an APP annually to Parliament.
The Strategic Plan should cover a period of at least five years and can be amended during the five-year period it covers.

The 2021/22 APP represents the first year of activities towards achieving the objectives contained in the DBE Strategic Plan 2020/21-2024/25.

The DBE’s Strategic Plan is anchored on the Government’s long-term plan; the National Development Plan 2030: Our future – make it work, the MTSF 2019-2024 and the draft Action Plan to 2024.
By 2030, South Africans should have access to education and training of the highest quality, leading to significantly improved learning outcomes.

The performance of South African learners in international standardised tests should be comparable to the performance of learners from countries at a similar level of development and with similar levels of access.
The Department gave a detailed overview by outlining the shape and the size of the basic education sector giving a comprehensive breakdown of the number of learners, educators and schools in the ordinary school sector by province for 2020.

In respect of education statistics, the Department further outlined the size of the schooling system with figures for the number of learners, educators, schools and languages.
2.1.2 Impact of COVID-19 – the World Health Organisation (WHO), in 2020 indicated that during the Coronavirus Disease (COVID-19) pandemic, prolonged school closures may result in a reversal of educational gains, limiting children’s educational and vocational opportunities as well as their social and emotional interactions and development.

The longer a student stays out of school, the higher the risk of dropping out.
Additionally, students who are out of school – and particularly girls – are at increased risk of vulnerabilities (e.g.

subject to greater rates of violence and exploitation, child marriage and teenage pregnancy).

Furthermore, prolonged school closures interrupt and disrupt the provision of, and access to, essential school-based services such as school feeding and nutrition programmes, immunisation, and mental health and psychosocial support.
2.1.3 Schooling and the Pandemic (Evidence, Conclusions and Recommendations) – The Department of Basic Education’s main findings were as follows: • Attendance rates had bounced back significantly since July 2020 when not all grades were open, but this ignored the effect of rotational timetabling which was resulting in further lost time at school.

• Attendance rates remained relatively high despite high levels of worry.
2 175 • More children received school meals in November 2020 compared to July 2020, but still not the usual percentage (about 65% of Households).

Children were still at substantially lower risk to COVID-19 than adults, especially young children.

The Department of Basic Education concluded the following recommendations: • Schools should remain open as far as possible, with all precautionary mechanisms in place, and priority given to early grades if a phased approach was needed.
• Prioritise recovery of learning, which would also mitigate against dropout.

• Implementation of school feeding should continue to be strengthened.
2.1.4 Progress on Selected Key Deliverables - The Department further listed the progress on selected key deliverables as follows: • Performance of the Class of 2020 NSC (Progressed learners excluded); • NSC performance from 2014 – 2020; • Bachelor passes per province in 2020; • Special Needs Education (SNE) learners by qualification type; • National School Nutrition Programme (NSNP) Quarter 1 – Quarter 3 of 2020-21; • Filling of Posts 202-21; • Funza Lushaka placements 20120-21; • Volume 1 Grade 1 to Grade 9 and Grade R Workbooks (2020); and • Volume 2 Grade 1 to Grade 9 Workbooks (2020).
2.1.5 Key Government Priorities – The MTSF 2019–2024 translates the ruling party’s electoral mandate into government’s priorities over a five-year period.

Basic Education is critical in priority 2, 3 and 6: • • • • • • • Priority 1: 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.

2.1.6 MTSF 2019 – 2024 Outcomes (Education) – The Department also detailed the following Education Outcomes for the 2019 – 2024 MTSF: 3 176 • Outcome 1: Improved school-readiness of children.

• Outcome 2: 10-year-old learners enrolled in publicly funded schools read for meaning.
• Outcome 3: Youths better prepared for further studies and the world of work beyond grade 9.

• Outcome 4: Youths leaving the schooling system more prepared to contribute towards a prosperous and equitable South Africa.

• Outcome 5: School physical infrastructure and environment that inspires learners to learn and teachers to teach.
2.1.7 The Significance of the State-of-the-Nation-Address (SONA) – The Presidential pronouncements set the key government priorities and deliverables for the year: • In turn determine the priorities of the DBE and the basic education sector broadly.

• The pronouncements commit the DBE in public to key activities and outcomes.

• Alignment to current annual plans of those key areas have tangible implications, not only for the DBE, but for the sector.
SONA 2021: • Learning Disruptions and Issues affecting learners - “Schooling disruption placed a huge burden on learners, teachers and families.” “It is our priority for this year to regain lost time and improve educational outcomes, from the early years through to high school and post-school education and training.” • Early Childhood Development (ECD) and Early Learning - “Equally we need to give attention to issues affecting children including improving school-readiness, ECD planning and funding.” SONA 2020: • Early Learning: Reading and Numeracy.
• Migration of ECD.

• Fourth Industrial Revolution and ICTS/Operation Phakisa.

• Competencies and Skills for a Changing World.

• Coding and Robotics.

• Learners with Special Needs (LSEN) Support: South African Sign Language (SASL) as Home Language (HL).

4 177 2.1.8 ECD Function Shift – The different work streams have made substantial progress in leading and guiding the provinces in preparing for the function shift.
Concurrence had been reached between the two Departments regarding the scope of the function shift.

The final Proclamations, the President’s Minute and the President’s Note have been sent to the Office of the Chief State Law Advisor.

A comprehensive diagnostic report has been completed on the resources that have been identified for transfer.
The Vision for ECD with DBE – The Department noted that during the SONA, the President announced the implementation of the Early Grade Reading Programme, which consisted of an integrated package of lesson plans, additional reading materials and professional support to Foundation Phase teachers.
This formed part of the broader efforts to strengthen the basic education system by empowering school leadership teams, improving the capabilities of teachers and ensuring a more consistent measurement of progress for grades three, six and nine.

There was a need to prepare young people for the jobs of the future.
2.2 Strategic Objectives, Indicators and Targets in the 2021 - 22 APP 2.2.1 The Action Plan to 2024 – The Action Plan to 2024: Towards the Realisation of Schooling 2030 was the sector plan for basic education.

It has been reviewed and strengthened for the 2020-2021 planning cycle.

The Action Plan was based on 27 national goals that were intended to improve basic education across all levels.
Thirteen (13) of these goals, were output goals, dealing with better school results and better enrolment of learners in schools.

The remaining 14 goals dealt with things that had to happen for the output goals to be realised.
2.2.2 Council of Education Ministers (CEM) Priorities for the 6th Administration – These priorities were approved by the Council of Education Ministers to lay a solid foundation for quality education, in support of improved reading and learning outcomes: • Improving foundational skills of Numeracy and Literacy, especially reading which should be underpinned by a Reading Revolution.
• Immediate implementation of a curriculum with skills and competencies for a changing world in all public schools (Three Stream Model, Fourth Industrial Revolution, Entrepreneurship, Focus Schools, etc.)
• Deal decisively with quality and efficiency through the implementation of standardised assessments to reduce failure, repetition, and dropout rates and introduce multiple 5 178 qualifications such as General Education Certificate before the Grade 12 exit qualification • Urgent implementation of two years of ECD before Grade 1, and the migration of the 0 - 4 year olds from Social Development to Basic Education.
• Complete an integrated Infrastructure Development Plan informed by infrastructure delivery and regular maintenance which is resourced.

• Work with Sport and Recreation, Arts and Culture, Health, and South African Police Services to teach and promote Social Cohesion, Health and School Safety.
2.3 Performance Measurement 2.3.1 Strategic Plan 2020/21 – 2024/25 – The Department gave a detailed overview of the impact statement, outcomes and indicators (including baseline and five-year target) for the following: • Outcome: 1: Maintain and develop the system of policies, including the curriculum and assessment, governing the basic education sector to advance a quality and inclusive, safe and healthy basic education system • Outcome 2: Maintain and develop information and other systems which enable transformation and an efficient and accountable sector.
• Outcome 3: Maintain and develop knowledge, monitoring and research functions to advance more evidence-driven planning, instruction and delivery.

• Outcome 4: Advance the development of innovative and high-quality educational materials.

• Outcome 5: Conduct strategic interventions to assist and develop provincial education systems.

2.3.2 MTSF 2019-2024 Review - The Medium Term Strategic Framework (MTSF) was led by the Presidency and Department of Planning, Monitoring and Evaluation (DPME.)
The DPME presented the MTSF review to the HEDCOM Subcommittee for Planning, Monitoring and Evaluation on 18 February 2021.

The Presidency has submitted the MTSF revisions for Cabinet approval.
The MTSF revisions were as follows: • Impact 1: Ø Migration of ECD to be concluded by 2024; 6 179 Ø baseline for percentage of 5 year olds (Grade RR) enrolled in educational institutions by 2024, has been corrected from 2017 to 2018; and Ø School readiness system and target for learners ready has been moved from 2021 to 2022.

• Impact 2: Ø Targets for Systemic Evaluation to be determined after first assessment conducted in October 2021.
Ø The approved curriculum for Coding and Robotics should be in place by 2022.

Ø A new indicator has been added “Number of learners with disabilities in appropriate formal education programmes” and the target to be achieved by 2024.

Ø The target for learning outcomes in Grade 6 Mathematics and Reading according to the international SACMEQ has moved from 2020 to 2022.
• Impact 3: Minor revision-target for SEAQMEC moved from 2020 to 2022 • Impact 4: Ø The Second Chance Matric Programme has been redesigned and reconfigured to include a new indicator: “Introduce a programme to train unemployed youths in general maintenance of schools”.

At least 710 youth should be trained within the 71 education districts.
Ø The Three Stream Model indicator has been revised from “fully implemented by 2024” to be specific and also split into two indicators “% of Schools of Skills implementing technical-occupational curriculum and “Number of ordinary schools implementing technical- occupational curriculum” with measurable targets.
• Impact 5: Ø The whole impact has been revised from “Learners and Teachers Feel Respected and Learning Improves by 2024” to Improved Quality of Teaching and Learning Through Provision of Appropriate Infrastructure.

7 180 2.4 DBE Programme Performance - The Annual Performance Plan (APP) summarised the priorities of the Department as aligned to the MTSF 2019 – 2014 and the draft Action Plan to 2024: Towards the Realisation of Schooling 2030.
The activities of the Department had been structured into five programmes as elaborated in the Annual Performance Plan: • Programme 1: Administration; • Programme 2: Curriculum Policy, Support and Monitoring; • Programme 3: Teachers, Education Human Resources and Institutional Development; • Programme 4: Planning, Information and Assessment; and • Programme 5: Educational Enrichment Services.
For the 2021 – 22 Annual Performance Plan there was a combined total of 70 performance indicators for all five programmes of the Department – and could be broken down into 58 (83 percent) annual targets, 10 (14 percent) quarterly targets, one (1.5 percent) bi-annual targets and one (1.5 percent) bi-ennial target.
2.4.1 Programme 1 – Administration 2.4.1.1 Annual Outcome Indicators: • Annual Performance Plan approved by 31 March each financial year – The Department’s target was to have the 2022-23 APP approved by March 2022 which they achieved.

• Number of capacity building programmes offered to the DBE officials – The target set by the Department stood at 12 capacity building programmes for 2021-22.
2.4.1.2 Quarterly Outcome Indicators: • Percentage of valid invoices paid within 30 days upon receipt by the Department – The target set by the Department stood at 100 percent.

• Number of reports on misconduct cases resolved within 90 days – The quarterly target set by the Department stood at four (4) reports.
8 181 • Quarterly Reports submitted to National Treasury(NT) and the DPME 30 days after the end of each quarter – The Department’s target was to submit four (4) quarterly reports to National Treasury and the Department of Performance Monitoring and Evaluation (DPME) 30 days after the end of each quarter.
2.4.2 Programme 2 – Curriculum Policy, Support and Monitoring: 2.4.2.1 Annual Outcome Indicators: • Number of Children/ Learners with Profound Intellectual Disability (C/LPID) using the Learning Programme for C/LPID using the Learning Programme for C/LPID – The Department’s target is set at 3 727 children/learners • A National Report is produced on monitoring of the implementation of the Policy on Screening, Identification, Assessment and Support (SIAS) as a mechanism for early identification and intervention – The target was for an approved National Report on monitoring of the implementation of the policy on SIAS as a mechanism for early identification and intervention.
• A National Report is produced on the amended legislation to regulate the new ECD landscape - The target was for an approved National Report on the amended legislation to regulate the new ECD landscape.

• A National Report is produced on the development of a new funding model for ECD - The target was for an approved National Report on the development of a new funding model for ECD.
• A National Report is produced on conducting an Early Childhood Development census to inform the integration of ECD into EMIS - The target was for an approved National Report produced on conducting an Early Childhood Development census to inform the integration of ECD into EMIS.
• A National Report is produced on developing and operationalising an Early Childhood Development Human Resource Development Plan - The target was for an approved National Report produced on the 9 182 development of a new ECD service delivery model and its workforce implications.

• Number of districts monitored on implementation of the National Curriculum Statement (NCS) for Grades 10 -12 – The Department’s target is set at eight (8) districts monitored.
• Number of provinces monitored on extra-support classes to increase the number of learners achieving Bachelor level passes - The Departments target is set at nine (9) provinces monitored.

• Number of schools monitored for implementing compulsory entrepreneurship education - The Departments target is set at 135 schools (15 schools per province).
• An Annual Sector Report is produced on the implementation of the General Education Certificate (GEC) – The target is an approved Annual Sector Report on the implementation of the General Education Certificate (GEC).

• An Annual Sector Report is produced on schools that are prepared to respectively implement and pilot the Technical Occupational Stream – The target is an approved Annual Sector Report on ordinary secondary schools that pilot the Technical Occupational Stream in 2021/22.
• Number of schools monitored for piloting the Coding and Robotics Curriculum – The target is set at 18 schools i.e.

two schools per piloting province.

• Number of schools monitored on the implementation of the reading norms - The Departments target is set at 18 schools.

• Number of schools monitored on the implementation of the Incremental Introduction to African Languages (IIAL) - The Departments target is set at 18 schools.
• Number of underperforming schools monitored on the implementation of the Early Grade Reading Assessment (EGRA) - The Departments target is set at 18 schools.

• Number of schools with multi-grade classes monitored for implementing the multi-grade toolkit - The Departments target is set at 32 schools.

10 183 • An Annual Sector Report is produced on the implementation of the National Reading Plan - The target is an approved Annual Sector Report on the implementation of the National Reading Plan.
• An Annual Sector Report is produced on the number of public schools monitored on the availability of readers - The target is an approved Annual Sector Report on the number of public schools monitored on the availability of readers.

• Number of schools per province monitored for utilisation of Information and Communication Technology (ICT) resources - The Departments target is set at 27 schools (three per province).
• Percentage of public schools with Home Language workbooks for learners in Grades 1 to 6 per year, after having placed an order - The Departments target is set at 100 percent for 2021-22.

• Percentage of public schools with Mathematics workbooks for learners in Grades 1 to 9 per year, after having placed an order - The Departments target is set at 100 percent for 2021-22.
• Percentage of public schools with workbooks for learners in Grades R per year, after having placed an order - The Departments target is set at 100 percent for 2021-22.

• An Annual Sector Report is produced on the learners provided with Mathematics and English First Additional Language (EFAL) textbooks in Grades 3, 6, 9 and 12 - The target is an approved Annual Sector Report on the learners provided with Mathematics and English First Additional Language (EFAL) textbooks in Grades 3, 6, 9 and 12.
• The number of schools monitored for home languages in which Literacy Grades 1-3 Lesson Plans have been developed for terms 1 to 4 - The Departments target is set at 10 schools.

• Number of special schools with access to electronic devices - The Departments target is set at 32 schools.

• An Annual Sector Report is produced on the monitoring of procurement and distribution of ICT devices - The target is an approved Annual Sector Report on the monitoring of procurement and distribution of ICT devices.
11 184 • An Annual Sector Report is produced on the number of teachers trained on inclusion - The target is an approved Annual Sector Report on the number of teachers trained on inclusion.

• An Annual Sector Report is produced on the number of learners in public special schools - The target is an approved Annual Sector Report on the number of learners in public special schools.
• An Annual Sector Report is produced on the percentage of public special schools serving as resource centres - The target is an approved Annual Sector Report on the percentage of public special schools serving as resource centres.

• An Annual Sector Report is produced on the establishment of Focus Schools per PED - The target is an approved Annual Sector Report on the establishment of Focus Schools per PED.
2.4.2.2 Quarterly Outcome Indicators: • Number of Technical schools monitored for implementation of Curriculum and Assessment Policy Statements (CAPS) – The target set by the Department is 18 schools monitored.

2.4.2.3 Bi-Annual Outcome Indicators: • Number of learners per year obtaining subject passes towards a National Senior Certificate (NSC) or extended Senior Certificate, including upgraded NSC, through the SCMP - The target set by the Department is 45 000 learners.
2.4.3 Programme 3: Teachers, Education Human Resources and Institutional Development 2.4.3.1 Annual Outcome Indicators: • Percentage of School Governing Bodies (SGBs) that meet the minimum criteria in terms of effectiveness – The Departments target is set at 90 percent of 100 sampled schools.

12 185 • Percentage of schools producing the minimum set of management documents at a required standard - The Departments target is set at 100 percent of 100 sampled schools.
• Number of Funza Lushaka bursaries awarded to students enrolled for Initial Teacher Education - The Departments target is set at 11 500 bursaries awarded.

• An Annual Sector Report is produced on the number of qualified teachers aged 30 and below entering the public service as teachers - The target is an approved Annual Sector Report on the number of qualified teachers aged 30 and below entering the public service as teachers.
• A National Report is produced on monitoring the functionality of Provincial Teacher Development Institutes and District Teacher Development Centres – The target is an approved National Report is produced on monitoring the functionality of Provincial Teacher Development Institutes and District Teacher Development Centres.
• A National Report is produced on monitoring the implementation of Teacher Development Programmes by PEDs with special focus on EFAL, Mathematics, Physical Sciences and Accounting – The target is an approved National Report is produced on monitoring the implementation of Teacher Development Programmes by PEDs with special focus on EFAL, Mathematics, Physical Sciences and Accounting.
• Number of PEDs that had their post- provisioning processes assessed for compliance with the post-provisioning norms and standards - The Departments target is set at nine.

• An Annual Sector Report is produced on the number of Grade R practitioners with at least NQF level 6 and above qualification - The target is an approved Annual Sector Report is produced on the number of Grade R practitioners with at least NQF Level 6 and above qualification.
2.4.3.2 Quarterly Outcome Indicators: • Number of quarterly monitoring reports tracking the percentage of Funza Lushaka graduates placed within six (6) months upon confirmation that the bursar has completed studies - The Department’s target is set at four reports.

13 186 • Number of quarterly monitoring reports indicating the number and percentage of schools where allocated teaching posts are all filled - The Department’s target is set at four reports.
• Number of PEDs monitored on the implementation of the Performance Management Service for school-based educators - The Department’s target is set at nine PEDs.

• Number of PEDs monitored on the implementation of Education Management Service: Performance Management and Development System (EMS: PMDS) - The Department’s target is set at nine PEDs.
2.4.4 Programme 4: Planning, Information and Assessment 2.4.4.1 Annual Outcome Indicators: • Number of new schools built and completed through ASIDI - The Department’s target is set at 21 schools.

• Number of schools provided with sanitation facilities - The Department’s target is set at 1 000 schools.

• Number of schools provided with water facilities through ASIDI - The Department’s target is set at 100 schools.
• Number of General Education and Training (GET) test items developed in Language and Mathematics for Grades 3, 6 and 9 - The Department’s target is set at 500 test items developed.

• Number of NSC reports produced - The Department’s target is set at four reports.

• Number of question papers set for June and November examinations - The Department’s target is set at 294 question papers.
• Percentage of public schools using the South African School Administration Systems (SA-SAMs) for reporting - The Department’s target is set at 98 percent of public schools.

• A National Report is produced on the number of provinces monitored for implementation of Learner Unit Record Information and Tracking System (LURITS) – The target is an approved National Report on the number of provinces monitored for implementation of Learner Unit Record Information and Tracking System (LURITS).
14 187 • A National Report is produced on learning outcomes linked to the National Assessment Framework (NAF) – The target is an approved National Report on learning outcomes linked to the National Assessment Framework (NAF).

• A National Report is produced on developing and operationalising a school readiness assessment system – The target is for an approved National Report on the First Early Learning National Assessment.
• Number of officials from districts that achieved below the national benchmark in the NSC participating in a mentoring programme - The Department’s target is set at 60.

• Percentage of District Directors who have undergone competency assessment prior to their appointment - The Department’s target is set at 96 percent of District Directors.
• Percentage of underperforming schools monitored at least twice a year by district officials - The Department’s target is set at 80 percent of underperforming schools monitored.

• Number of District Director forums held - The Department’s target is set at three forums.

• Number of districts in which teacher development has been conducted as per District Improvement Plan - The Department’s target is set at 60 districts.
2.4.4.2 Biennial Outcome Indicators: • Percentage of school principals rating the support services of districts as being satisfactory - The Department’s target is set at nil (zero) for the 2021-22 APP.

2.4.5.

Programme 5: Educational Enrichment Services 2.4.5.1 Annual Outcome Indicators: • Number of PEDs with approved annual business plans for the HIV/AIDS Life Skills Education Programme - The Department’s target is set at nine PEDs.
15 188 • Number of districts monitored in the implementation of the National School Safety Framework (NSSF), Social Cohesion, Sport and Enrichment Programmes - The Department’s target is set at 75 districts monitored.

2.4.5.2 Quarterly Outcome Indicators: • Number of schools monitored for the provision of nutritious meals - The Department’s target is set at 120 schools monitored.
• Number of learners, educators, parents, SGBs and other education stakeholders reached through social cohesion programmes - The Department’s target is set at 3 000.

• Number of districts implementing the programme on school assemblies to end school-related gender-based violence - The Department’s target is set at 75 districts.
2.5 Update on the 2021-22 Standard Output Indicators (SOIs) for the Sector (Provincial Alignment Work) The draft 2021/22 SOIs were sent to PEDs on 14 August 2020 for submission of inputs by 24 August 2020.

No inputs were received.

Letters were sent to HODs on 21 September 2020, to note the decisions and agreements of the sector in relation to the 2020/21 SOIs and request them to adopt the 2021/22 SOIs in their plans.
The letters to HODs also requested PEDs to include inputs emanating from the 2019/20 audit on the SOIs document in track changes, to incorporate any issues from the 2019/2020 audit, with responses on 29 September 2020. Letters were received with inputs from PEDs except Eastern Cape.

Inputs from all PEDs were consolidated into the final document, indicating what was incorporated and what was not, with reasons.

The analysis showed that only 3 indicators were agreed on by all PEDs without issues raised.
Consultations were held with individual PEDs to secure sufficient consensus on indicators that the majority had agreed to, i.e to increase the number of standardised indicators in the sector.

As a result of consultations, the standardised output indicators increased from 3 to 20, which were then approved by the Director-General (DG) with letters to HODs on 6 November 2020.

16 189 A total of seven PEDs have formally adopted the SOIs through HOD letters.
The two outstanding PEDs are Western Cape (that raised additional issues through an email) and Mpumalanga (that committed to submit the formal adoption letter).

The whole sector does not have standardised indicators, but is working towards it led by the Head of Department for Free State as the Chairperson for the HEDCOM Subcommittee on Planning, Monitoring and Evaluation.
2.6 Comments by Oversight Structures on the 2021-22 APP - Comments were received from the following oversight structures: • Auditor-General South Africa (AGSA); • National Treasury; • Department of Planning, Monitoring and Evaluation; and • Internal Audit.

The Department also had collaborations with other government and non-government stakeholders.

This also included the implementation of the Management Performance Assessment Tool (MPAT) recommendations.
There were further engagements with Statistics South Africa on outdated data.

Policies crucial for inclusion of persons with disabilities, women and youth should be referenced.

The Department further outlined its responses and amendments on comments by the oversight structures on the 2021-22 APP.

The Department further gave a detailed overview of the Technical Indicator Description (TID) Amendments as well as the strategic areas identified as gaps in the 2021-22 APP.
2.7 Budget Review – 2021 2.7.1 MTEF (2021) Cabinet Baseline Reductions 2021/22 2022/23 R’000 R’000 2023/24 R’000 2021 Indicative Allocation 27 332 964 28 592 395 29 714 789 Less: Conditional Grants Learners with Profound Intellectual Disabilities Grant (72 299) (13 462) (89 348) (16 316) (47 571) - 17 190 Maths, Science and Technology Grant (10 775) (13 960) (23 945) Education Infrastructure Grant (21 362) (25 590) - HIV and AIDS ( Life Skills) National School Nutrition Programme Grant Baseline reduction Goods and services Non-profit institution (National Education Collaboration Trust) School Infrastructure Backlog: Building and other Infrastructure Departmental agencies and accounts Foreign Governments and International organisations Households (NSFAS) Interest and rent on land Compensation of Employees (16 628) (10 072) (242 587) (85 789) ( 4 839) - (10 672) (882) (54 620) (1 630) (84 155) (21 150) (12 332) (328 375) (116 879) (6 296) - (13 764) (1 149) (71 678) (2 120) (116 489) (23 626) - (863 180) (211 981) (11 418) (413 287) (15 226) (2 082) (128 484) (3 845) (76 857) Baseline Budget Review 27 018 078 28 174 672 28 04 038 2.7.2 Departmental Appropriation The Department had been allocated R27 billion in 2021/22, R28.2 billion in 2022/23 and R28.8 billion in 2023/24.
Included in these allocations is Compensation of Employees amounting to R538 million, R532.7 million and R535.6 million respectively over the Medium- Term Expenditure Framework (MTEF) years.
2021/22 R’000 2022/23 R’000 2023/24 R’000 Departmental Appropriation 27 0182227 018 078 228 174 67228 174 672 28 8028 804 038 Less: Compensation of Employees (538 011) (532 730) (535 567) Departmental Appropriation excluding compensation of employees 26 480 067 27 641 942 28 67 471 18 191 2.7.3 Programmes Allocations over the 2020 MTEF PROGRAMME BUDGETS 2021/22 R’000 2022/23 R’000 2023/24 R’000 Administration 523 198 531 121 Curriculum Policy, Support and Monitoring Teachers, Education Human Resource and Institutional Development Planning, Information and Assessment 2 034 347 2 069 537 538 414 2 084 265 1 448 059 1 493 625 1 500 273 14 580 177 15 260 705 15 485 048 Educational Enrichment Services 8 432 297 8 819 684 9 196 038 Total 27 018 078 28 174 672 28 804 038 2.7.4 Details of Earmarked Allocations (R’000) over the 2020 MTEF EARMARKED FUNDS 2021/22 2022/23 R’000 R’000 2023/24 R’000 Workbooks 1 197 218 1 207 033 1 204 870 Matric Second Chance Programme Oversight-Maths, Science and Technology Learners with Profound Intellectual Disabilities Conditional Grant Examiners and Moderators National School Nutrition Programme TOTAL: EARMARKED FUNDS 1 340 386 1 352 221 1 356 029 2.7.5 Details of Conditional Grants Allocations/Transfers (R’000) over the 2020 MTEF CONDITIONAL GRANTS 2021/22 R’000 20222/23 R’000 2023/24 R’000 19 192 Learners with Profound Intellectual Disabilities Grant Maths, Science and Technology Grant 242 760 249 430 260 424 412 134 424 528 433 079 Education Infrastructure Grant 11 688 936 12 229 436 12 768 433 HIV and AIDS (Life Skills) Grant 241 914 241 054 241 653 National School Nutrition Programme Grant 8 115 269 8 504 132 8 878 942 TOTAL CONDITIONAL GRANTS 20 701 013 21 648 580 22 582 531 2.7.6 Details of Transfers (R’000) over the 2020 MTEF OTHER TRANSFERS 2021/22 R’000 2022/23 R’000 2023/24 R’000 Unesco Membership Fees 17 317 17 7773 17 841 ADEA Guidance Counselling and Youth Development Centre:
 Malawi Childline South Africa National Education Collaboration Trust Southern and Eastern Africa Consortium for Monitoring Educational Quality 160 199 78 164 204 82 165 205 86 117 558 120 738 121 515 3 720 3 816 3 831 NSFAS: Funza Lushaka Bursaries 1 308 024 1 355 113 1 360 320 Transfers to Public Entities 1 447 056 1 497 890 1 503 963 Umalusi ETDP SETA South African Council for Educators TOTAL TRANSFERS 137 404 459 17 985 155 848 142 031 142 945 472 18 528 474 18 599 161 031 162 018 20 193 2.7.7 Detailed Breakdown of the Budget over the 2020 MTEF Compensation of Employees Goods and Services School Infrastructure Office Accommodation Departmental Projects Earmarked Funds (including CoE) Transfers Conditional Grants Total 2021/22 2022/23 R’000 R’000 2023/4 R’ General Budget Support General Budget Support Rural Education Assistance Project Systemic Improvement of Language and Numeracy in Foundation Phase 2021/22 R’000 2022/23 R’000 2023/24 R’000 19 955 16 201 - - - - 2.8 Committee Observations Members raised the following with the Department of Basic Education in respect of Budget Vote 16: Basic Education: • Due to the late submission of the presentation to Members, there was a query whether Members could submit written questions to the Department for written reply and follow- up.
• In respect of issues pertaining to budget cuts and the financial economic environment, Members raised some of the following: o Had the Department considered more innovative ways of providing quality learning and teaching.

21 194 o How was the Department looking to ensure this did not impact negatively on many of its programmes and functions?

o How was budget cuts affecting the work of the Department in reaching its targets and objectives.
o How was the current economics influencing budgets for programmes and projects – were infrastructure projects included in the budget • What were the strategies in place to assist and support teachers going forward – how was the Department managing the loss of teachers leaving vacancies in the system.

Further to this, Members queried the measures in place for those teachers at risk of contracting the COVID -19 virus – as well as the management of the filling of vacant positions in the system.
• Members took the time to raise their concerns around developments in the country around student registration at Higher Education Institutions – at the start of every year, students had challenges with registration.

Members queried whether there was any role to be played by the Department of Basic Education in assisting and supporting learners wishing to enroll at Higher Education Institutions.
• Members queried the plans in place to ensure teachers, as frontline workers, were able to be prioritised for COVID-19 vaccinations.

• In respect of the roll-out of Coding and Robotics, Members queried the provinces being targeted for implementation and roll-out; and the rationale for choosing these specific provinces.
2.9 Responses by the Department of Basic Education Minister A Motshekga – Minister Motshekga alluded to the various challenges in respect of the ECD function shift and also noted that facilities needed the necessary upgrading by using the Social Development model.

She indicated that the Department was in continuous and ongoing engagements with the Department of Social Development regarding the ECD function shift.
During this period of COVID-19, much was learned in helping to demystify our thoughts on education.

Most rural schools had innovative ways for teaching and learning but it was clear that this could not replace the teacher for face-to-face teaching and learning.

A teacher in a classroom remained central in enhancing learner performance.

The Department had received numerous reports from school principals who spoke of the many challenges 22 195 with virtual teaching.
Other initiatives that was bearing fruit was the Woza-Matric Programme.

The Department was lucky that they had a pool of Funza Lushaka graduates to fill gaps in vacancies – unfortunately, not all could be absorbed in current context.

Regarding budget cuts and dwindling finances, the Department was forced to postpone some programmes and projects but key projects would not be compromised.
Director-General, Mr H M Mweli – Mr Mweli assured Members that the Department would strive to ensure reports and presentation be submitted at least a week in advance for Members to peruse prior to meetings.

The Department would ensure all written questions received would also be responded to in good time.

He agreed that there were many lessons learned with the advent of the COVID-19 pandemic.
The Department was able to engage and collaborate within the region and continent to learn from each other on navigating the pandemic.

Many teachers utilised WhatsApp to communicate and keep contact with learners.

The Department had further developed strategies and plans to combat fatigue by way of motivation programmes amongst others.

The Director-General agreed that issues of oversight and monitoring needed to be strengthened in respect of the Annual Performance Plan programmes and targets.
The country as a whole was in a difficult fiscal space in respect of budget cuts and its impact on programmes and projects.

The Department was learning to stretch its budget to deliver on key programmes and projects.

The Department had also become more innovative with the fiscal constraints to ensure programmes and projects could be realised e.g.

use of ICT and virtual meeting options.

The Department realised that virtual devices could not replace face-to-face teaching and learning.
It was mentioned that provinces had set aside a budget to provide virtual devices to teachers and learners – with different provinces being at different levels in respect of providing online teaching and learning.

The Director-General mentioned that he attended regular NATJOINTs of DGs to deal with COVID-19 work-streams and further advised Health to prioritise teachers at frontline with vaccinations in the next drive.

This was agreed to.
This was agreed to.

With the assistance and support from the various Network Providers, it was envisaged that all Special School would be fully connected by the end of the year.

The Department was also working to ensure the digitization of all content.

23 196 The diminished budget posed a huge challenge in respect of filling of vacancies – but the Department was continuously engaged on the matter.
The Department would ensure that issues of Human Resources and Labour in relation to the ECD function shift would be maintained and improved.

Mr Mweli acknowledged the challenges faced each year with enrolment of student at Higher Education Institutions (HEIs) – this was amplified when, historically, most learners came from no-fee-paying schools.

The Minister also agreed that the matter was a national concern.
This has prompted a report through a Cabinet Sub-Committee on trends and challenges in respect of registration at HEI.

The biggest challenge identified was not space but historical debt of students, low completion/pass rates and student readiness.

3.
Department of Basic Education Audit Committee The Audit Committee is responsible for the following: • Oversight over Internal and External Audit; • Oversight over the implementation of Internal and External Audit recommendations; • Oversight over Risk Management; • Oversight over the quality of Financial Statements; and • Oversight over the system of internal control for the generation, collation and reporting of Performance Information The Internal Audit conducted twelve audits as per the approved risk-based audit coverage plan as well as audits at three Implementing Agents (IAs) on SCM processes, contractor’s payments, project management, quarterly performance information and follow-ups on AGSA findings and review of the PPP agreement procurement process.
The Audit Committee further presented the quarterly progress reports against the approved plan at the Audit Committee meetings.

Further to this, the Audit Committee also coordinated the audit steering committee meeting with management to discuss all audit reports and audit action plans prior the audit committee meetings.

The Audit Committee advised management through audit assurance by providing recommendations to improve internal controls.
They also coordinated a workshop together with AGSA and Office of the Director-General for ASIDI and Finance and all implementing agents on areas that must be improved to strengthen internal controls.

The Audit Committee also conducted investigations on 24 197 irregular and fruitless and wasteful expenditure, and reports were referred after the DG consideration to Labour Relations for consequence Management and Legal Services to start the recovery process.
3.1 Assurance Model In respect of the Assurance Model, the Audit Committee gave a breakdown as follows: • Management - First line: the way risks are managed and controlled day-to-day.

Assurance comes directly from those responsible for delivering specific objectives or processes.

It may lack independence, but its value is that it comes from those who know the business, culture and day-to-day challenges.
• Risk and Compliance - Second line: the way the organisation oversees the control framework so that it operates effectively.

The assurance provided is separate from those responsible for delivery, but not independent of the management chain, such as risk and compliance functions.

• Internal Audit - Third line: objective and independent assurance, e.g., internal audit, providing reasonable (not absolute) assurance of the overall effectiveness of governance, risk management and controls.
The level and depth of assurance provided will depend on the size and focus of the internal audit function and management’s appetite for internal audit assurance.

• External Audit - Fourth line: assurance from external independent bodies such as the external auditors and other external bodies.

External bodies may not have the existing familiarity with the organisation that an internal audit function has, but they can bring a new and valuable perspective.
Additionally, their outsider status is clearly visible to third parties, so that they can not only be independent but be seen to be independent 3.2 Improvements In respect of improvements, the Audit Committee highlighted the following: • Monitoring the Performance Information on a quarterly basis and annual target milestones achievements through internal audits to verify reliability of evidence reported; • Enhanced effective coordination of verification of reported evidence with Strategic Planning and Branches; • Reviewing and monitoring of the evidence that support performance indicators for changes on the Revised APP due to COVID -19; 25 198 • Reviewing and follow up audits on ASIDI on the control's effectiveness of qualification areas, commitment (provision and retention disclosure); • Reviewing and monitoring the improvement on non-compliance regarding Supply Chain Management for three (3) Implementing Agents.
3.3 Challenges Challenges identified by the Audit Committee included the following: • Strengthening of quality assurance by some Branches still need to improve.

• Lack of capacity in ASIDI and Supply Chain management.

• Prior audit findings have not been addressed fully - management was still working on addressing them.

• A lack of synergy between Finance and ASIDI (There is an improved working together process between Finance and ASIDI).
• ASIDI and Finance needed to strengthen quality assurance and accountability of work done by Implementing Agents.

The Audit Committee also touched on the Audit Outcomes in respect of the following: • Regularity Audit which highlighted ASIDI material misstatements, irregular expenditure and commitments (provision and retention).

• Performance Information The Audit Committee gave a detailed breakdown of the above Audit Outcomes with details on root causes and proposed improvements.
The Audit Committee recommended the following: ASIDI: • Improve monitoring of Implementing Agents, Programme Support Unit (PSU) and ASIDI staff to improve the process.

• Full set of half-year financial statements are prepared, enhance the accurate records.

• Submission of information for preparation of AFS timely.

• Regular monthly reconciliations to be prepared to prevent misstatements in the financial statements.

26 199 • More internal audit effort directed.

• Interim audit by AG.


• Possible disciplinary action against persons that caused irregular, fruitless and wasteful expenditure.

Performance Information: • Management to strengthen quality assurance of reported information timely.

• More detail work by Internal Audit on quarterly performance information reports and financial statement reviews.

• Management to improve or address the capacity challenges in Strategic Planning, Finance, and ASIDI.
• Strengthens accountability and monitoring of Implementing agents, especially the penalty clauses in the MOA’s The annual report was reviewed prior to the submission to the AGSA and management worked with the Internal Audit to correct other gaps identified during the review meeting prior to the submission date.

Some branches needed to improve on the quality of evidence and ensure timely submission.
The Audit Committee has received a management action plan to address AG findings and has monitored progress.

The Audit Committee approved follow-up audits to be conducted by Internal Audit for ASIDI irregular expenditure completeness and commitment/provision.

Internal Audit in collaboration with DG’s Office, and AGSA held a comprehensive workshop with ASIDI, Finance and Implementing Agents in November 2020 to discuss improvement actions and to determine whether it will address the root cause of findings.
The Audit Committee would continue to address all matters within its mandate and responsibility and pay specific attention to the high risk and high impact issues and monitor implementation of consequence management to assist in moving towards a clean audit.

3.4 Committee Observations (Internal Audit Committee) • Members raised concern that ASIDI remained an area of challenge but was satisfied with the progress by the Department to date.
• Members queried the actions taken by the Department in respect of the recommendations from the Audit Committee 27 200 • Regarding the recouping of money, Members queried the status and progress in respect of the recouping of money owed to the Department in respect of ASIDI projects – and the methods utilised for such recouping.

Further to this, Members queried the consequence management action taken against errand officials, contractors or implementing agents.
3.5 Responses from the Department of Basic Education (Internal Audit Committee) For the Department, issues pertaining to ASIDI remained their main area of focus.

The Department wanted to ensure that there was improvement on management of the ASIDI project.

The Department was certain that they would see much improvement closer to the end of the year.
Having engaged the Director-General on the matter of ASIDI, there was a need to ensure supplementing the capacity within the Department or outsource the capacity if needs be.

The recouping of money was ongoing and continuous.

4.
4.

Overview of Strategic Imperatives and Budget Allocations of the Department’s Statutory Bodies 4.1 South African Council for Educators (SACE) SACE (the Council) presented the Council-approved 2021/2022 Annual Performance Plan (APP), with the 2021/2022 Budget which were tabled in Parliament, through the Minister of Basic Education.
The Council has aligned its programmes with the SACE mandate and the budget programme structure, and has thus had to review its strategic plan 2020-2025 in order to adequately respond to its mandate and priorities.

There were now six programmes that the Council will be implementing through this APP 2021/2022.

The presentation commenced with details pertaining to the background, policy and legislative mandate of the Council – including the values, vision and mission.
The Council detailed the revised programme budget structure as follows: • Administration o Executive and Governance o Planning, Monitoring and Evaluation and Reporting o Corporate Services o Financial Management o Information and Communication Technology • Professional Registration o Registration of Educators and Lecturers 28 201 o Registration of Student Teachers • Ethical Standards o Investigations o Disciplinary Hearings o Sanctioning • Professional Development o Continuing Professional Teacher Development o Member Support o Quality Assurance • Professional Standards o Initial Teacher Education o Newly Qualified Educators o Practicing Educators • Research o Research Reports o Data Management o Research Dissemination o Virtual Library 4.1.1 Key Strategic Priorities that are informing the SACE Agenda for the next five- years • Teacher Professionalisation across the teacher education and development continuum – maintenance of the professional and ethical standards • Promotion of the reading and learning teaching profession - SACE-established internal Resource Centre for employees and Council members, the SACE Virtual Library for registered educators, and SACE Constituencies and Stakeholders- ‘READ to TEACH AND SERVE’ • Teacher Wellbeing, Rights, Responsibilities, and Safety • Values and Ethics for the Teaching Profession • Strengthened and Integrated Information and Communication Technology • Heightened Communication - Educators, Stakeholders and the Public • Data, Information and Knowledge Management – Lead the profession from an informed position and provide evidence-based advice to the Ministers, Council and the teacher education and development sector at large.
29 202 4.1.2 Annual Performance Plan 2021 – 2022 4.1.2.1 Programme 1: Administration - The purpose of this programme is to implement and manage the policy directives and priorities of the Council to ensure the functional proficiency of SACE through appropriate support services.

Outcome – Efficient and Effective governance • Number of Council and EXCO meetings convened – The SACE target is set at 12 meetings convened.
• Number of quarterly performance reports submitted to DBE – The SACE target is set at four reports submitted.

• Percentage of employees assessed through performance development system – The target is set at 100 percent • Percentage of trained employees – The target is set at 30 percent • Number of SACE promotion and advocacy activities on the selected core mandates – The target is set at four activities.

• Percentage of invoices paid within 30 days – The target is set at 100 percent of invoices paid.
• Percentage of Digitised system in a year – The target is set at 60 percent.

Governance Matters for Noting - The 31st July 2021 marks the end of term of office for the current serving Council.

The Council was in preparation for the nomination, selection and appointment of the 2021-2025 Council members.

A guideline on the nomination, selection and appointment of Council has been developed and approved by Council for implementation from the 1st April 2021 onwards.
SACE Constituencies engaged in a process to nominate prospective Council members, from the 1st – 31st April 2020, as follows: • Eighteen (18) members from the organised profession (SADTU – 12 out of 18); • Two (2) members from the National School Governing Bodies Association; • One (1) member from the independent schooling sector; • One (1) member from the Council on Higher Education; • Five (5) members from the Department of Education; and 30 203 • One (1) member from the Technical and Vocational Education and Training sector.
4.1.2.2 Programme 2: Professional Registration - The purpose of this programme is to ensure that Council registers college lecturers and teachers who are fit to practise.

Council must keep an up-to-date register of fit-to-practise educators and college lecturers.

Sub-Programme 2.1 – Registration of Student Educators Outcome: Fit-to-practise-registered educators and lecturers • Number of educators registered – The SACE target is set at 25 000 educators registered.
• Percentage of educators applying through the online system for professional certification – The target is set at 50 percent of educators.

Sub-Programme 2.2 – Registration of Student Educators Outcome: Fit-to-practise-registered educators and lecturers • Creation of additional specified categories for student educators - The SACE target for a pilot five-year registration of first-year student educators with 12 universities.
Professional Registration Challenges (2020/2021) • COVID – 19 pandemic impact of registration outcomes; • New-normal and working from home; • Slow turn-around time; • Cancelled graduations by Higher Education Institutions impacting on newly qualified educators – and updating their provisional to full registration status; • SA Post-Office bulk-mail closure impacting on the posting of registration certificates; • SAPS not providing police clearance certificates; • Preference of walk-ins over online registration system by applicants; 31 204 • 2020 Academic Year overlapping into 2021 – Implications for the newly qualified educators • Generally, inadequate communication from SACE to the teaching profession.
4.1.2.3 Programme 3: Ethical Standards - The purpose of this programme is to promote and maintain ethical standards in the profession.

The programme has three sub- programmes.

Sub-Programme 3.1 – Investigations Outcome: Maintained ethical standards • Percentage of investigations on new cases finalised – The SACE target is set at 80 percent of investigations.

• Percentage of investigations on roll-over cases finalised – The target is set at 80 percent of investigations.
Sub-Programme 3.2 – Disciplinary Hearings Outcome: Maintained ethical standards • Percentage of disciplinary hearings on new cases finalised – The SACE target is set at 50 percent of disciplinary hearings.

• Percentage of disciplinary hearings on roll-over cases finalised – The SACE target is set at 60 percent.

Sub-Programme 3.3 – Sanctions Outcome: Maintained ethical standards • Number of monitoring reports produced on sanctioned educators - The SACE target is set at two monitoring reports.
The Council further gave a detailed overview of the following: - Top 10 cases reported to SACE in 2020/21; - Sexual misconduct cases from 2014 – 2020; - Nature of professional misconduct; and - Sanctions 2020/2021.
32 205 Ethical Standards Challenges - Challenges encountered by SACE in the execution of its duties while implementing the code of ethics include among others: • COVID -19 pandemic lockdown, particularly during the first six months; • Parental refusal to permit children to testify as a result of COVID-19 pandemic; • Closure of schools; • Challenges with online disciplinary hearings; • Restricted access to schools; and • Slow turnaround time in concluding the cases.
4.1.2.4 Programme 4: Professional Development - The purpose of the programme is to ensure that educators engage in life-long learning to improve their professional competence.

The programme has three sub-programmes.

Sub-Programme 4.1: Continuing Professional Teacher Development (CPTD) System Outcome: Improved teacher competence • Percentage of selected practising signed-up educators verified for the continuing professional development uptake – The SACE target is set at 30 percent.
• Percentage of signed-up final-year initial teacher education students – The SACE target is set at 55 percent.

Sub-Programme 4.2: Member Support Outcome: Improved teacher competence • Number of educators supported on professional matters – The SACE target is set at 20 000 educators.

Sub-Programme 4.3: Quality Management Outcome: Improved teacher competence • Percentage of professional development providers approved – The SACE target is set at 75 percent.
• Percentage of professional development activities endorsed- The SACE target is set at 85 percent.

33 206 • Percentage of endorsed activities monitored- The SACE target is set at 10 percent.

The mandate of SACE is to instil life-long learning in educators.

For this financial year, Professional Development will provide more support to the five percent of randomly selected educators in each province, as in the previous financial year Covid-19 posed some challenges.
The planned contact sessions for supporting teachers’ participation in the CPTD system and how to develop the Professional Development Portfolios did not take place due to social distancing and travel restrictions under COVID 19.

This Programme will work collaboratively with Communication and ICT in developing virtual, online and digitised systems and PD material to assist teachers in Developing Professional Development Portfolios, and participate in the CPTD system.
The CPTD Information system functionality will be enhanced to ensure maximum participation 4.1.2.5 Programme 5: Professional Teaching Standards - The purpose of the programme is to improve and maintain the status and image of the teaching profession, and ensure the quality of initial teacher education and ongoing professional development through quality assurance mechanisms and standards.

The programme had three sub- programmes.


Sub-Programme 5.1: Initial Teacher Education Outcome: Improved teacher professionalism • Development of teacher professionalisation policy – The target of approved teacher professionalisation policy would be met in 2022/23.

• Policy framework registering student educators from year one – The target for approved policy framework registering student educators from first year of study would be met in 2022/23.
Sub-Programme 5.2: Newly Qualified Educators Outcome: Improved teacher professionalism • Development of a professional certification framework and policy for educators registering with Council – The target is a draft professional certification framework and policy consulted on.

34 207 • Development of a teacher designation – The target is for teacher designation communication strategy and plans to be implemented.
Sub-Programme 5.3: Practicing Educators Outcome – Improved teacher professionalism • Development of re-certification framework - The target is for extensive consultation in 2021/22.

4.1.2.6 Programme 6: Research - The purpose of the programme is to enhance research coordination within SACE in order to strengthen its advisory role and service that is informed by policy, research, and consultative processes.
This programme also aims to promote research on professional matters and any other educational matter relevant to SACE and the educational landscape.

This programme will work to further strengthen its advisory role to the Minister of Basic Education on professional matters.

The programme has three sub-programmes.

Sub-Programme 6.1: Research Reports Outcome: Improved advisory role • Number of research reports produced – The SACE target is three research reports produced.
Sub-Programme 6.2: Data Management Outcome: Improved advisory role • Number of statistical reports produced on the status of the profession – The SACE target is set at two statistical reports produced.

Sub-Programme 6.3: Research Dissemination Outcome: Improved advisory role • Number of SACE journal magazines produced – The SACE target is set at two journal magazines produced.
Sub-Programme 6.4: SACE Virtual Library Outcome: Improved advisory role 35 208 • Percentage of visits by educators to the virtual library – The SACE target is set at 10 percent.

As part of supporting the Presidential and Ministerial priority on reading, SACE launched a Virtual Library to promote a reading profession.

The Virtual library has over 50 000 free titles available for teachers and SACE stakeholders to access immediately, including the CAPS related ones.
The Council also alluded to the handbook on teacher safety and security in schools that covered the rights and responsibilities of teachers in respect of the safety programme.

The handbook was a living document that could be reviewed and revised based on the changing nature of the complexities in the schooling environment.
4.1.3 Resource Consideration 4.1.3.1 Medium Term Expenditure Framework (MTEF) 36 209 Financial performance in R,000 2016/17 2017/18 2018/19 2019/20 2020/21 2021/22 2022/23 Audited Audited Audited Budget Revenue Registration fees Subscription fees Reprints of certificates Interest receivable CPTD Subsidy Sundry income Expenditure Administration & Other Related Costs Research Professional Development Registration Code of Ethics Teacher Professionalization Surplus/Deficit Detailed Budget (2021/2022) 37 210 4.1.3.3 SACE Notes: • Registration fees remain at R400 for Foreigners, R200 for South Africans and R50 for renewals and updates; • The main funding for Council operation is annual membership fees which is at R180 per educator effective from 01.11.2017; • There is constant level of revenue over the MTEF period; • The reduction of some budget line items is due to the rising fixed costs with stable revenue; • The Council is in a process of reviewing its membership fees to counter the pressurizing economic situation and improve delivery capacity; • This process is hampered by the economic conditions severely affecting the educators who are responsible for funding Council.
• Reprioritisation and stringent cost control measures are being implemented to enable sustainability while council is considering alternatives to improve its revenue level.
• Approval has been obtained from The National Treasury to subsidise the implementation for the CPTD Management System for the year 2021/22; • The operational budget of the five Provincial offices, including the Eastern Cape and Western Cape, are included in the operating budget; and • The Eastern Cape province has been operational since October 2020 with the Western Cape delayed to start in this financial year owing to acquisition of office space which was concluded at the end of 2021 financial year.
4.1.3.4 Committee Observations • In respect of cases (resolved and unresolved) Members queried what SACE was aiming to achieve in respect of targets.

Members ought clarity on the number of unresolved cases and the effectiveness of the investigators in dealing with these cases.

Members also queried how many cases of Gender Based Violence and sexual misconduct SACE processed in a year – and how many were rolled over.
In respect of cases, Members also queried whether SACE experienced a recurrence of similar conduct by educators.

What cases, according to SACE qualified to be dealt with internally and those dealt with by law enforcement agencies.

38 211 • Regarding errand educators found guilty of serious offences and having been struck-off the roll – Members queried whether there was a mechanism in place to track and trace such educators in the system.
• There was concern raised over the backlog of registration/certification of unregistered teachers and queried the minimum qualification to be a registered teacher.

Further to this, Members queried whether SACE was quality testing educators to be registered with SACE.

• Concern was raised over the accessibility of SACE in the country and queried whether SACE had offices in all provinces.

If not, how was SACE accessible in provinces where they did not have offices.
Members requested information on provinces that did not have walk-in offices.

Members noted that there were complaints that SACE was not communicating issues of registration status timeously.

• In respect of ethical standards, Members queried how SACE was able to accomplish heightened ethical standards during the COVID-19 pandemic period.

• With COVID-19, Members sought clarity on how registration of teachers had been affected.
Members also questioned if SACE had considered online registration and the effectiveness of online registration.

• How had SACE been able to succeeded in converting COVID-19 challenges into strengths.

• In Respect of the BELA Bill, Members noted that, in respect of SACE, certain sections had been removed from the Bill.

Members sought clarity on this and queried how SACE amendments would be accommodated and processed.
• Members sought clarity on the plans in place the function shift of ECD to DBE – and what role SACE played in the function shift.

There were ECD practitioners who lacked formal qualification but had extensive experience.

Members queried how they would be accommodated and recognised.

• Members queried whether all schools had the necessary sexual harassment policies in place.

• In respect of the SACE budget, Members queried the impact of the lower budget on the work and programmes of SACE.
• On Professional Development of Educators, Members queried whether SACE would consider incentives for educators to improve and develop their qualifications.

39 212 4.1.3.5 Responses from SACE The matter of linking salary increment/remuneration with teacher qualification has been a matter for debate in the Council for a long time.

SACE had considered broad- banding and had later moved to Occupational Specific Dispensation (OSD) in this regard.
SACE currently did not have mechanisms in place for further incentives for educators.

SACE also a Teacher Development Summit where it was recommended that there be a separation of performance appraisal and incentives.

SACE currently had five provincial offices (Limpopo, Eastern Cape, Western Cape, Free State and KwaZulu-Natal).

SACE was planning, in the next five years to acquire offices in the remaining provinces depending on the economic situation.
Regarding registration, SACE had challenges during the COVID-19 lockdown, especially in the first six months of the year.

Although there were backlogs, SACE was working tirelessly to ensure these are processed and cleared.

The role of SACE was also to advise the Department and Ministry as clearly stated in the Act.

The role of SACE in ECD migration included the registration of ECD educators at NQF 4 provisionally.
SACE was looking to professionalise ECD and resolved to establish an adhoc-committee to collaborate with the Department on issues pertaining to the function shift.

SACE agreed that Gender Based Violence (GBV) was becoming a huge problem that was filtering into schools.

On average SACE dealt with around 100 reported cases of sexual misconduct and ensured that these cases were prioritised.
Further to this, SACE also established a trilateral with DBE and PEDs to trace and track educators found guilty of an offence and ensure they did not enter the system again.

In this regard SACE was also working with Independent Schools in the sector and request that they check and verify with SACE prior to employing any educators.

SACE could not be entirely sure if all schools had, and implemented any sexual harassment policy.
40 213 In respect of issues pertaining to the BELA Bill, there was an explanation on the issues of SACE having to expand its mandate to include TVET Colleges.

SACE had argued the functions to run between schools and colleges as well as possible review of the entire SACE.

The clauses had been removed from the BELA Bill – and SACE would keep the Committee abreast of these developments.

SACE did have the necessary resources for online registration for first-time registrants.
SACE had also integrating its ICT systems for further alignment.

Although access to data was a challenge, SACE was engaging network service providers to consider possible zero-rating of SACE applications – as well as consideration for reverse billing.

In respect of the low budget allocations – the impact on the mandate was minimal as SACE was funded by its own members which were educators – and SACE determined the membership fees rate between reviews.
Rising cost would catch up with SACE and pressure the total revenue which may lead to a reduction of delivery capabilities of SACE.
4.2 The Council for Quality Assurance in General and Further Education and Training (Umalusi) The mandate of Umalusi was determined by the following: • Chapter 2 of the Constitution: Everyone has a right to education; • National Qualifications Framework: The establishment of Umalusi as a Quality Council; and • GENFETQA Act: Assigns Umalusi the responsibility for quality assurance of general and further education and training.
Umalusi is the quality Council responsible for qualifications registered on the general and further education and training qualifications sub-framework (GFETQSF) on the National Qualifications Framework (NQF).

The Council ensures that the providers of education and training have the capacity to deliver and assess qualifications and learning programmes and are doing so to expected standards of quality.
4.2.1 Reflections (2020/21) Implementation of the first Annual Performance Plan (APP) of the current five-year strategic plan was disturbed by the COVID-19 pandemic – with the initial targets in 41 214 the 2020/21 APP being significantly affected.

Umalusi therefore revised the APP and the Minister re-tabled it in Parliament in July 2020.

As a result, not all out targets would be achieved for 2020/21.
Despite the challenges, Umalusi had managed to remain focused on its five-year strategic priorities reflected as follows: • Reviewing the quality assurance of assessment approach so as to accommodate new qualifications; • Evaluating and appraising new qualifications – e.g.
General Education Certificate (GEC); • Amending the founding Acts to accommodate new qualifications and desired extensions in the mandate of quality assurance; • Intensifying research on educational developments to innovate and advise the Ministers of Education; • Intensifying advocacy on qualifications within the sub-framework; and • Seeking for an alternative funding model to increase revenue.
4.2.2 Strategic Focus • External Environment o COVID-19: Negative impact on evaluation and accreditation, verification, certification, quality assurance of assessment, monitoring, advocacy and research activities o Roles and Responsibilities: Umalusi is part of a process of amending the NQF Act regarding Umalusi’s role as a Quality Council o Policy Performance: Ongoing policy development based on research – to remain relevant and competitive o Quality Assurance Approach: Innovative approaches on quality assurance were developed during lockdown; these will be continued and improved o Communication: There is a steady growth of utilisation of digital media platforms o Qualifications, Certification and Accreditation: Trends on the number of certificates issued for all five qualifications; our numbers are constant on verification of qualifications 42 215 o Quality Assurance of Assessment: Trends on the moderation of question papers, monitoring of examination centres during writing, monitoring of marking centres, verification of marks for various subjects o Evaluation and Accreditation: Trends on institutions granted seven- year accreditation, more institutions placed on a window period indicating that they have few issues to address towards accreditation o Evaluation and Appraisal of New Qualifications: GEC qualification, NASCA curricula o Empowerment of Women, Youth and People with Disabilities: Through Credit Accumulation and Transfer policy, SCM processes, staff establishment provisions • Internal Environment o Organisational Structure and Human Resources Capacity: Small organogram (140 posts); workload challenges, the need for alternative funding to create more posts; vacancy rate under 10% o Facilities: Umalusi 41 (Umalusi house) project on course; occupancy of parts of the building has eased pressure on Umalusi 37 (Thuto-Mfundo) to allow for social distancing o Financial Resources: Clean audit for 2019/20; budget cut in 2020/21, more funds on ICT services to allow working remotely; there is a need to attract sufficient funding o Information and Communication Technology: More ICT equipment purchased to enable service delivery during lockdown – also with the migration to Microsoft 365.
Vulnerability management solution implementation.

o Communication Management: Usage of eight communication platforms as well as webinars for stakeholder engagement.

4.2.3 Measuring Performance 4.2.3.1 Programme 1: Administration – The purpose of the programme is to provide strategic leadership, management and administrative services to the organisation.
Sub-programmes include: 43 216 • Strategy and Governance (S&G); • Public Relations and Communications (PR&COMS); • Information and Communication Technology (ICT); • Human Capital Management (HCM); and • Finance and Supply Chain Management (F&SCM).

Programme 1 Targets: • Number of advocacy webinars conducted – The annual target is set at four webinars (one per Quarter).

• ICT Network health score maintained at ≥95 percent - The annual target is at ≥95 percent.
• Vacancy rate maintained at ≤ 10 percent - The annual target is set at ≤10 percent.

• Percentage of valid invoices of creditors and suppliers paid within 30 days – The target is set at 99 percent of valid invoices paid.

4.2.3.2 Programme 2: Qualifications and Research - The purpose of the programme is to develop and manage an efficient and effective GFETQSF within the NQF and to undertake strategic research in support of that goal.
Sub-Programmes included the following: • Qualifications, Curriculum and Certification (QCC); and • Statistical Information and Research (SIR).

Programme 2 Targets: • Number of reports produced on the management of qualifications in the sub-framework – The target is set at one report produced annually.

• Percentage of error-free learner records for which a certificate is printed – The target is set at 100 percent error-free records.
• Percentage of verification requests received that are completed in terms of the service level agreement: two working days – The target is set at 96 percent of verification requests.

• Number of research reports completed in various formats – The target is set at five research reports annually.
44 217 4.2.3.3 Programme 3: Quality Assurance and Monitoring – The purpose of the programme is to ensure that the providers of education and training have the capacity to deliver and assess qualifications registered on the GFETQSF and are doing so to the expected standards and quality.

Sub-Programmes include the following: • Quality Assurance of Assessment: School Qualifications; • Quality Assurance of Assessment: Post-School Qualifications; and • Evaluation and Accreditation.
Programme 3 Targets: • Number of quality assurance of assessment reports published for qualifications registered on the GFETQSF – The annual target is set at 10 assessment reports.

• Percentage of question papers approved per qualification – The target is set at 100 percent of question papers approved.

• Number of assessment bodies audited for their state of readiness to conduct examinations – The annual target is set at four assessment bodies audited.
• Number of subjects for which verification of marking is conducted- The target is set at 88 subjects.

• Number of subjects for which moderation of internal assessment is conducted – The annual target is set at 125 subjects.

• Percentage of accreditation outcomes for private education institutions finalised within 12 months of the site visit – The target is set at 85 percent of accreditation outcomes.
• Percentage of identified private education institutions monitored after being granted accreditation – The target is set at 90 percent of identified institutions.

4.2.4 Budget Presentation (2021/22 – 2023/24) The total budget for 2021/2022 equaled R 175 Million.

The Department of Basic Education (DBE) grant was expected to decrease by 1 percent from the prior year.

Umalusi’s own generated income was projected to increase by 14 percent.
The impact of COVID-19 continued to put the organisation under financial strain.
45 218 Table: 1 Revenue Projection Revenue 2018/1 2019/20 2020/2 2021/2 2022/2 2023/2 9 2 0 n s millio 129 11 10 6 5 7 millions millio 135 12 8 2 5 6 139 10 4 4 3 12 1 n s million 13 11 7 6 4 9 3 s 2 2 s 7 million 14 13 10 7 4 10 166 167 172 175 185 4 s 3 million 14 13 10 7 4 10 5 193 DBE Grant Verification of certification Accreditation of Providers Certification Interest Other income- quality assurance Reserves TOTAL Table: 2 Expenditure Projection Expenditure 2018/19 2019/20 2020/21 2021/2 2022/23 2023/24 Compensation of Employees Goods and Services 2 0 millions millions millions million 74 103 177 84 89 173 85 87 172 86 89 175 2 s millions millions 86 99 185 86 107 193 • Expenditure per programme stood as follows: o Administration – 37 percent; o Qualifications, Curriculum and Certification – 11 percent; o Quality Assurance of Assessment – 30 percent; o Evaluation and Accreditation – 14 percent o Statistical Information and Research – 8 percent • Financial Challenges: o Umalusi has had an increase in its mandate with no further funding (GETC, NASCA) o Further projects that required funding included the modernization of ICT infrastructure and refurbishment of the Thuto Mfundo building.
46 219 4.2.5 Conclusion Umalusi management was committed to maintain a clean audit report.

The achievement of APP targets was part of the SMS members’ Performance Agreements.

Executive Management would monitor the implementation of the APP and the utilisation of the budget monthly.
Overall performance and reporting will be monitored by: • Performance Information Verification Committee (PIVC); • Internal Auditors; • Quarterly Review Meetings; and • Oversight structures (Audit and Risk Committee, Executive Committee of Council (EXCO) and Council).

4.2.6 Committee Observations • Members noted that, in respect of infrastructure, this was not adequate as the Department sought to introduce distance learning.

Many areas did not have network connectivity and learners had no smart gadgets.
Members queried the challenges faced by Umalusi during the COVID-19 pandemic and the measures in place to mitigate such challenges.

• Was Umalusi empowered to exempt smaller viable performing schools from fees payments.

• In respect of the National Senior Certificate for Adults (NASCA) qualification, Members queried how this would work and when this qualification would become available.
Members also sought clarity on the funding required for NASCA qualification - and whether Umalusi had budgeted for this qualification.

• Had Umalusi considered the possibility of the professionalisation of independent religious institutions who produced good results.

How could Umalusi assist with the professionalisation of such institutions.
• Regarding the negative impact on the budget of Umalusi due to COVID-19, Members queried how and which targets had been affected – and the financial implications of this.

Further to this Members also queried how the increase mandate was impacting on the work of Umalusi.

• In respect of the Umalusi staff complement, Members queried how many were persons with disabilities.

• Members queried the turn-around time for the verification of qualifications.
• With bogus/non-accredited schools, Members queried how Umalusi was able to verify these and alert communities of un-accredited schools.

47 220 • In respect of the 2020 leaked exam papers, Members queried how this may have impacted on learners trying to gain access to universities.

Members also queried the role played by Umalusi regarding the leaked papers – and the approval of the new question papers where there were leaks.
• Members queried whether Umalusi had considered a review of the preparation of question papers beforehand- and possibly reset such question papers in view of the COVID-19 pandemic.

• In respect of the TVET Colleges certification backlog, Members queried how the progress by Umalusi in reducing the backlog on certification.
With classes not fully resumed as yet, Members queried whether there was concern at the possible lowering of the academic standards with a possibility that the syllabus may not be completed.

4.2.7 Responses from Umalusi Umalusi was also experiencing the pouching of its professional staff.

Due to the COVID-19 pandemic the Council was not able to attend fully to some of its targets – but through innovations and lessons learned, the Council was looking to attend to targets.
Much of the work of the Council was now done online covering much more ground.

The Council was aware of the inequalities being faced in the sector but also learned that the education system in SA was resilient.

The Council insisted that the curriculum not be trimmed down – and universities had no complaints with accepting Grade-12 learners of 2020.

The Council also learned that the time allocated for quality assurance was too compressed – and needed to be reviewed.
Regarding the NASCA, the Council gave a detailed explanation on the qualification and a possible pilot only in 2023 due to the COVID-19 pandemic.

There was some concern with the readiness of DHET to implement the NASCA.

Umalusi would keep the PC abreast of developments in respect of the new qualification.

The Council would forward official correspondence, through the Chairperson, on issues of independent schools with budget constraints and possible fees indemnity.
Due to the pandemic, Umalusi did not visit and monitor schools as usual as travelling had been affected.

Umalusi did not have any staff with disabilities because their movement would be limited and constrained due to the building lay-out.

Umalusi was working on making building more disabled-friendly facility.

Umalusi was able to process the verification of qualifications within three days – but other verifications for registration on the sub-framework was a lengthier process.
48 221 Umalusi vacancies are capped at less than 10 percent – and there was agreement that when vacancies arose, they would not automatically be filled but the posts would be frozen for a period of time until the financial situation improved.

The Council was not in favour of retrenchments and was in discussions with DBE on an alternate funding model.

The Council, under Lockdown Level 3 – 5, operated completed remotely with alternate days and a hybrid model during Levels 1 and 2.
Umalusi found it difficult to identify unaccredited institutions due to internal capacity constraints – but if reported to Umalusi they are reported to the authorities.

The paper leaks had no impact on the NSC of 2020. last year.

The matter with contractors is in for arbitration and needed to be concluded by July 2021.

5.
5.

Committee Recommendations: The Select Committee on Education, technology, Sports, Arts and Culture, having considered the budget Vote 16 and the 2021/22 Annual Performance Plan recommends that there should be an alignment of the provincial education department plans to ensure seamless service delivery.

In light of that, the Committee will engage the Provincial departments going forwards to ensure the provision of quality education.
The Select Committee on Education and Technology, Sport, Arts and Culture, having considered Budget Vote 16: Basic Education, together with the Annual Performance Plan of the Department of Basic Education recommends that the Minister of Basic Education ensure the following: 51.
Department of Basic Education • The Department ensure that the reports reach the Committee 7 days in advance • The Department ensure that structural support is provided for migration of ECD to DBE • The Department in partnership with DHET play a role to ensure that the issue of learner registration in Higher Education at the beginning of each year is dealt with systematically.
• The Department keep Committee abreast on progress with regards to Coding and Robotics • The Department ensure that the Provincial Education Departments (PEDs) that are struggling in respect of infrastructure projects, work in collaboration with other PEDs to yield the desired results.
49 222 • The Department ensure that with regards to infrastructure backlogs, that the implementing agents are held accountable to the extent that those that are unreliable are taken off the system, so that they cannot continue and they should be – deregistered.

• The Department was urged to ensure that DBE appoints credible Engineers as project managers so that issues of infrastructure are dealt with.
• The Department kept the Committee updated on a monthly basis and quarterly basis to the extent to which progress is achieved, and also report on infrastructure grant, (ASIDI and SAFE).

• The Department must ensure that PEDs are compliant with the COVID - 19 regulations, also considering that there might be an anticipated 3rd wave.
• The Department ensure that PEDS planned effectively for COVID – 19, put measures in place in schools to maintain the social distance, safety protocols and staggering of classes so that learners are not accommodated in overcrowded classrooms.

• The Department ensure that assistance and support for learners with special educational needs are prioritized and that they are provided with necessary resources.
• The Department ensure that schools have access to ICT, more especially those in underprivileged communities and rural areas.

Further recommendation also alluded to the need for review of learner transport to ensure learners safety to and from school.
• The Department in collaboration with the Department of Health, should ensure that everyone is healthy, in collaboration with Department of Social Development the issue of Psycho – Social support is addressed 5.2 South African Council for Educators (SACE) • SACE ensured that offices are established in the remaining provinces where they were not accessible.
• SACE to ensure that they bring online registration of teachers, and vetting of registered educators on board including teachers in remote /rural areas.

• Ensure that teachers are identified as early and when they accomplish the qualification, that they get registered.

• In line with SACE program on Professional Development, the Committee made recommendation for Training of ECD care givers be given priority.
• SACE ensures that they support professionalization of the ECD practitioners below NQF level 4, to acquire a qualification at NQF level 4, 50 223 5.3 Council for Quality Assurance in General and Further Education and Training (Umalusi) • Umalusi ensured that the Council maintain the Clean Audit status as the entity is performing well.

• Umalusi ensure that the vacancies are filled and closed.
• Umalusi ensure that staff salaries to be on par with public service to avoid movement of people to other organisation, a situation that impacts on staffing.

6.
6.

Conclusion Having satisfied itself in its engagement with the Department of Basic Education and Statutory Bodies on their Annual Performance Plan and the Budget, the Select Committee on Education and Technology, Sport, Arts and Culture recommends that Budget Vote 16: Basic Education be adopted and that the House approves Budget Vote 16: Basic Education.

Report to be considered.

51 224 12.
REPORT OF THE SELECT COMMITTEE ON EDUCATION, TECHNOLOGY, SPORTS, ARTS AND CULTURE ON CONSIDERATION OF BUDGET VOTE 17: HIGHER EDUCATION AND TRAINING, DATED 02 JUNE 2021 The Select Committee on Education, Technology, Sport, Arts and Culture (hereinafter referred to as the Committee), having considered the Revised Strategic Plan: 2020 – 2025 and Annual Performance Plan (APP): 2021/22 and budget of the Department of Higher Education and Training (hereinafter referred to as the Department), reports as follows: 1.
INTRODUCTION AND MANDATE OF THE COMMITTEE AND THE DEPARTMENT OF HIGHER EDUCATION AND TRAINING 1.1.

Purpose of the Budget Vote 17 Report The purpose of this report is to account for work done by the Committee in considering the Revised Strategic Plan: 2020 – 2025 and Annual Performance Plan (APP): 2021/22 and budget of the Department of Higher Education and Training in accordance with Section 27(1) of the Public Finance Management Act, 1999 (Act.
No 29 of 1999), and as referred by the Chairperson of the National Council of Provinces (NCOP) to the Committee in terms of Rule 338 for consideration and reporting.

1.2.

Mandate of Committee and the Department The mandate of Parliament is based on the provisions of the Constitution of the Republic of South Africa, 1996, establishing Parliament and setting out the functions it performs.
Parliament’s role and outcomes are to represent the people and ensure government by the people under the Constitution, as well as to represent the provinces and local government in the national sphere of government.

The main functions of Parliament as outlined in the Constitution are: • To pass legislation, • To oversee executive action, • Facilitation of public involvement, co-operative government and, 225 • International engagement.
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.

1.3.
1.3.

Method The Revised 2020 - 25 Strategic Plan and 2021/22 APP and budget of the Department 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 2021 State of the Nation Address (SONA).

The Committee had a briefing session to consider the Revised Strategic Plan and the APP of the Department on Wednesday, 12 May 2021.

2.
2.

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

Key government policies 2.1.1.

The National Development Plan (NDP) Vision 2030 The NDP identifies the decent work, education and the 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.

The White Paper for Post-School Education and Training (WPPSET) 1 226 The White Paper articulates a vision for an integrated system of post-school education and training, with all institutions playing their role as parts of a coherent but differentiated system.

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

Flowing from the White Paper, the Department has developed a Draft National Plan for Higher Education, 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.

2019 – 2024 Medium-Term Strategic Framework (MTSF) In 2019, the new Administration has identified seven priorities derived from its electoral mandate and the 2019 State of the Nation Address (SONA) to focus its interventions for the 2019 – 2024 MTSF period.

The 2019 – 2024 MTSF is a five-year strategic plan of government, and forms the second five-year implementation phase of the NDP.

The post-school education and training sector contributes to Priority 2: Education, Skills and Health.
This priority contributes to pillar 2 of the NDP pillars, which is Capabilities of South Africans.

In implementing Priority 2: Education, Skills and Health, Government has developed the new 2019 – 2024 MTSF.

The Strategy has four Outcomes that are relevant to the Department of Higher Education and Training (DHET).

These are: • Expanded access to PSET opportunities; • • Improved success and efficiency in the PSET system; Improved quality of PSET provisioning; and • A responsive PSET system.

2.1.4.
2.1.4.

2021 State of the Nation Address (SONA) 2 227 On 11 February 2021, the President addressed South African citizens during his State of the Nation Address.

The February 2021 State of the Nation Address (SONA) key focus areas were the following: • To defeat the Coronavirus (COVID-19) pandemic; • To accelerate economic recovery; • To implement economic reforms to create sustainable jobs and drive inclusive growth; and • Fight corruption and strengthen the State.
One of the key focus areas of the February 2021 SONA remains inclusive growth and addresses critical priorities for the Higher Education and Training sector.

There has been a steady improvement in the reach of education; although it is acknowledged that it is inadequate.

The continued focus on inclusive growth is about the critical actions that are required to build a capable state and place the economy on the path to recovery.
In response to the huge challenge of youth unemployment the country faces, the President announced that the Department of Small Business Development would provide Grant funding and business support to 1 000 young entrepreneurs within 100 days.

While the programme had to be put on hold due to the Coronavirus restrictions, it nevertheless managed to reach its target of 1 000 businesses by International Youth Day on 12 August 2020.
This provides a firm foundation for efforts to support 15 000 start-ups by 2024.

3.

OVERVIEW AND ASSESSMENT OF THE DEPARTMENT’S REVISED STRATEGIC PLAN 2020 – 2025 The Deputy Minister of Higher Education, Science and Innovation noted that the 2020/21 financial year proved to be a challenging year as the COVID-19 pandemic remained a major disruption for the economy, government service delivery, the Department, and the PSET system in particular.
The national state of disaster and the nationwide lockdown necessitated campus closures and in some cases led to declining admissions and enrolments in institutions of higher learning.

The Deputy Minister further indicated that as everyone know, it became necessary to combat the spread of the virus and limit its impact on the Post-School Education and Training (PSET) 3 228 sector.

As mentioned before, the Department has adopted a risk-adjusted strategy, informed by the National Command Council.
They were determined that no learner would be left behind and committed their efforts to the #Save the Academic Year, #Save Lives, through innovation and science.
Through targeted interventions, linked to each Level of the Lockdown, the Department implemented efforts geared towards curbing the spread of the pandemic at institutions of learning, testing and providing support, ensuring that students had uninterrupted access to teaching and learning support materials, access to affordable data for access to educational content and websites, to name a few.
The Deputy Minister said that the Department’s efforts of saving lives and the academic year have had positive results.

The 2020 reorganized/restructured academic programme has enabled all the institutions and their students to complete academic requirements.

Notwithstanding the positive strides, the constantly changing environment pushed the Department to review the initial commitments of the 2020-2025 Strategic Plan in preparation for the 2021/22 Medium Term Expenditure Framework period.
The lessons learned from the effects of the pandemic on the economy and the PSET system at large had to be taken into consideration during the review process.

The Deputy Minister pointed out that the revised Strategic Plan: 2020-2025, presented to the Committee, builds on the strides the Department have made towards building and strengthening the Post-School Education and Training system since the advent of democracy in the Republic of South Africa.
As the Department continue to steer the system, their interventions are consistently informed by the policy directives of the White Paper for PSET and their resolve towards ensuring that the country has a skilled and capable workforce that supports an inclusive growth path in a fair, equitable, non-racial, non-sexist and democratic manner.

However, the advent of COVID-19 and its impact on the economy is increasingly becoming a challenge to government and its service delivery efforts.
While the Department’s five year strategic thrusts remain relevant, they have made few considerations during the review process and some amendments have been made to the Strategic Plan to try and make it relevant to the changing environment.

He concluded by highlighting some of the critical areas that the revised Strategic Plan will be taking forward, as follows: 3.1.

Downward adjustment of the MTSF 2019 – 2024 targets in the following Outcomes 4 229 3.1.1.
Expanded access to PSET opportunities • Number of student enrolments at TVET colleges annually, from 710 000 to 620 000.

• Number of students enrolled at the CET colleges annually, from 555 194 to 388 782.

3.1.2.

Improved success and efficiency of the PSET system • Number of TVET students enrolled in the Prevocational Learning Programme (PLP) annually, from 7 000 to 4 000.

3.1.3.
3.1.3.

Improved Quality of the PSET Provisioning • Number of New Generation of Academics Programme (NGAP) posts allocated to universities every year, from 100 to 85.

3.1.4.

A responsive PSET system • Percentage of TVET college lecturing staff appropriately placed in industry or in exchange programmes, from 33% to 18%.

3.2.

Inclusion of MTSF 2019 – 2024 outcome indicators and targets that have been excluded in the original Strategic Plan 3.2.1.
Improved quality of the PSET Provisioning In addition to the MTSF system targets included in the DHET’s Revised Strategic Plan 2020 – 2025, the Department has also included new indicators and targets in Outcome 4: A responsive PSET System as follows: • Number of lecturers participating in project-based lecturer capacity-building programmes in engineering (electrical, plumbing and mechanical), (300 by 2024).

5 230 • Number of TVET colleges with 4IR centres of excellence established, (50 by 2024).
• Number of lecturers participating in digital literacy programmes, (6 000 by 2024).

3.2.2.
3.2.2.

MTSF Outcome indicators and targets that do not reflect in the Revised Strategic Plan 2020 - 2025 Notwithstanding the inclusion of some of the MTSF outcome indicators and targets that were not reflected in the original Strategic Plan of the Department, it should be noted that there are some of the MTSF outcome indicators and targets that have not been included in the Revised Strategic Plan 2020 -2025, and these are: 3.2.2.1.
Expanded access to PSET opportunities: • Number of learners registered for SETA supported skills learnership annually (116 000).

• Number of learners registered for SETA-supported internships annually (18 000).

In relation to the above outcome indicators and targets, the Department reflected only the number of learners who will complete these programmes.

3.2.2.2.
3.2.2.2.

Improved quality of the PSET provisioning • Number of protocols signed with industry to place TVET college students and lecturers for workplace experience, (target: all TVET colleges sign protocols with industry and place learners for workplace experience accordingly).

4.

2021/22 MEDIUM-TERM EXPENDITURE FRAMEWORK (MTEF) BUDGET 4.1.
Overview and assessment of the 2021/22 Medium-Term Expenditure Framework (MTEF) Budget and the 2021/22 Annual Performance Plan (APP) Table 1: Summary of the overall Budget Allocation and Expenditure Estimates: 2021/22 6 231 Programme Budget Nominal Rand change Real Rand change Nominal % change Real % change R million 2019/20 2020/21 2021/22 20222/23 2019/20-2020/21 2019/20-2020/21 Programme 1: Administration Planning, Policy and Strategy Programme 3: University Education Programme 4: Technical and Vocational Education and Training Programme 5: Skills Development Programme 6: Community Education and Training 412.2 491.2 525.7 552.2 79.0 58.3 19.17 per cent 14.14 per cent 180.7 214.5 227.5 239.2 33.8 24.8 18.71 per cent 13.70 per cent 73 365.0 80 083.4 84 332.6 0.0 6 718.4 3 343.2 9.16 per cent 4.56 per cent 12 630.9 13 813.6 14 644.0 15 278.7 1 182.7 600.5 9.36 per cent 4.75 per cent 280.9 318.5 336.6 354.8 37.6 24.2 13.39 per cent 8.61 per cent 2 143.8 2 522.9 2 686.7 2 780.5 379.1 272.8 17.68 per cent 12.72 per cent TOTAL 89 013.5 97 444.1 102 753.1 19 205.4 8 430.6 4 323.8 9.47 per cent 4.86 per cent The National Development Plan envisages that, by 2030, South Africans should have greater access to post-school education and training opportunities through a system that is responsive to their needs.
This is supported by priority 2 (education, skills and health) of Government’s 2019-2024 Medium-Term Strategic Framework.

Over the medium term, the Department of Higher Education and Training will aim to give expression to these guiding policies by focusing on transforming universities and increasing student financial aid; expanding access to TVET colleges and improving their performance; developing artisans; and strengthening the governance of the community education and training sector.
Over the medium term, the Department will focus on expanding access to higher education institutions by implementing a 5-year plan for the enrolment of students at higher education institutions, and updating guidelines for the implementation of its bursary scheme for students from poor and working-class backgrounds.
As part of its focus on improving performance in higher education institutions, the Department will seek to implement university capacity development plans, eradicate the certification backlog in TVET colleges, and conduct advocacy campaigns on the use of open-access learning and teaching support materials in CET colleges.
The Department has a budget of R358 billion over the medium term, of which 90.4 per cent is earmarked for transfers and subsidies to departmental agencies and accounts, and higher education institutions that provide access to more than 6.5 million students.

These funds will be used to build a high-quality, demographically representative higher education sector that provides students and staff with opportunities for access and success.
7 232 Cabinet has approved reductions to the Department’s baseline amounting to R24.6 billion over the MTEF period, to be effected on transfers and subsidies (R19.6 billion), compensation of employees (R4.6 billion), and goods and services (R290.2 million).

These reductions include R6.8 billion on the allocation to the National Student Financial Aid Scheme for loans and bursaries, R5.0 billion on university subsidies, and R947.1 million on TVET college infrastructure grants.
The reductions to university subsidies will likely lead to a decrease in the number of first-year enrolments at universities.

Although this will have a longer-term impact on the number of new graduates emerging from the system, it is necessary to ensure that institutions remain sustainable and can offer quality education, and is expected to be offset by improvements in the throughput rate at universities.
Although a decrease in first-year enrolments at universities and TVET colleges will begin to offset by the reductions to the National Student Financial Aid Scheme, this will result in fewer students who enter higher education being able to access support in 2021.
The sector may also need to consider revising its policy positions on supporting poor and working-class students in higher education and training, including the maximum allowances for accommodation, transport and food, and halting funding for second qualifications.

Although the reduction to TVET college infrastructure grants could lead to delays in beginning new projects, it will ensure that funding is more closely aligned with the sector’s capacity to spend.
The budget structure for the Department remains unchanged and has six expenditure programmes: • Programme 1: Administration; • Programme 2: Planning, Policy and Strategy; • Programme 3: University Education; • Programme 4: TVET; • Programme 5: Skills Development; and • Programme 6: CET.

8 233 For the 2021/22 financial year, the budget allocation is R97.7 billion.

This excludes the direct charges to the SETAS and the National Skills Fund (NSF) of R14.2 billion and R2.5.
billion respectively bringing the total budget to R115.5 billion.

The nominal increase is R3.7 billion or 3.9 per cent from the adjusted budget of R94.1 billion in 2020/21.

When the inflation rate is taken into consideration, the budget allocation declines by R252.2 million or 0.3 per cent real terms.
Table 2: Reflects the budget summary indicating allocations across the MTEF R million Total Current payments 2021/22 2022/23 2023/24 Transfers Payments and for capital Total Total subsidies assets MTEF Allocation Programme 1: Administration 504,0 496,3 0,0 7,7 480,9 495,7 Programme 2: Planning, Policy and Strategy 230,7 123,0 107,0 0,7 230,2 234,6 Programme 3: University Education 81 223,2 95,5 81 127,2 0,6 84 058,0 84 651,8 Programme 4: Technical and Vocational Education and Training 13 096,2 7 890,9 5 198,2 6,6 13 377,9 13 233,9 Programme 5: Skills Development 307,9 158,3 147,7 1,9 312,7 314,2 9 234 Programme 6: Community Education and Training 2 422,0 2 213,8 207,7 0,5 2 484,9 2 572,5 97 784,0 10 977,7 86 788,3 18,0 100 944,6 502,7 101 Subtotal Direct charge against National Revenue Fund Sector Education and Training Authorities (SETA) 14 250,3 0,0 14 250,3 0,0 15 384,1 16 610,2 National Skills Fund (NSF) 2 562,6 0,0 3 562,6 0,0 3 846,0 4 152,5 Total expenditure 115 122 estimates 596,9 10 977,7 104 601,2 18,0 120 174,7 265,4 Source; National Treasury (2021b) Table 2 above shows that Programme 3: University Education receives the bulk of the budget equating to 83 per cent followed by Programme 4: Technical and Vocational Education and Training (13.3 per cent), Programme 6: Community Education and Training (2.4 per cent), Programme 1: Administration (0.5 per cent), Programme 5: Skills Development (0.3 per cent) and Programme 2: Planning, Policy and Strategy (0.2 per cent).
The allocation of the budget across programmes is of concern, especially when taking into consideration skills development, which is primarily supported under Programmes 3 and 5.

For example, Programme 5 only accounts for 0.3 per cent compared to the 83 per cent allocation to Programme 3.

This would impede the realisation of the NDP targets due to inadequate provision of funding.
10 235 Figure 1: Comparison of budget allocations over the medium term Source; National Treasury (2021b) When looking at the nominal amounts for the budget allocation across the MTEF, allocations show a year-on-year increase.

However, when the projected inflation rates are taken into consideration, the budget decreased in 2021/22 and subsequently decreases in the following two financial years.

4.2.
4.2.

Overview and assessment of the 2021/22 MTEF budget allocation per programme and the 2021/22 performance targets This section explores budget allocations per programme for the 2021/22 financial year.

The table below sets out the budget allocation per programme for the current financial year and compares it to allocations in 2020/21.
Table 3: Change to allocations per programme for 2021/22 Nominal Increase / Decrease in 2021/22 Real Increase / Decrease in 2021/22 Nominal Percent change in 2021/22 Real Percent change in 2021/22 Budget 2020/21 2021/22 402,2 504,0 101,8 81,5 25,31% 20,26% Programme R million Programme 1: Administration 11 236 Programme 2: Planning Policy and Strategy Programme 3: University Education Programme 4: Technical and Vocational Education and Training Programme 5: Skills Development Programme 6: Community Education and Training 189,0 230,7 41,7 32,4 22,06% 17,14% 78 321,5 81 223,3 2 901,8 -372,1 3,70% -0,48% 12 652,2 13 096,2 444,0 -83,9 3,51% -0,66% 282,6 307,9 25,3 12,9 8,95% 4,56% 2 247,4 2 422,0 174,6 77,0 7,77% 3,43% TOTAL Source: National Treasury (2021b) 94 094,9 97 784,1 3 689,2 - 252,2 3,9% -0,27% Table 3 above shows that the budget allocation in real terms, when inflation is taken into consideration, decreased by 0.27 per cent from the previous financial year.
It also shows that Programme 1: Administration has the greatest increase of 20.26 per cent followed by Programme 2: Planning, Policy and Strategy (17.14 per cent), Programme 5: Community Education and Training (4.56 per cent) and Programme 6: Skills Development with 3.43 per cent.
The table also shows that Programme 4: Technical and Vocational Education and Training (3.51per cent) and Programme 3: University Education (3.7 per cent) increases in nominal terms but when inflation is considered the allocations decrease by 0.66 per cent and 0.48 per cent, respectively.

4.2.1.

Programme 1: Administration This Programme provides strategic leadership, management and support services to the department.
The Programme has five sub-programmes for 2021/22; namely; Department Management, Corporate Management Services, Office of the Chief Financial Officer, Internal Audit and Office Accommodation.

For the 2021/22 financial year, the budget allocation for this Programme is R504 million.

The adjusted allocation for 2020/21 was R402.2 million, representing a nominal increase of R101.8 million or 25.3 per cent.
Taking inflation into consideration, the budget for this programme has increased by R81.5 million or 20.2 per cent.
Table 4: Budget allocations for all sub-programmes in Programme 1 12 237 Sub-Programmes: Administration R million Sub-Programme 1: Department Management Sub-Programme 2: Corporate Management Services Sub-Programme 3: Office of the Chief Financial Officer Sub-Programme 4: Internal Audit Sub-Programme 5: Office Accommodation TOTAL Source: National Treasury (2021b) Budget 2020/21 % Total programme Budget 35,4 232,5 115,5 11,7 108,8 504,0 7% 46% 23% 2% 22% 100% Table 4 shows the budget allocation for each sub-programme.
Sub-programme 2 received R232.5 million or 46 per cent which is the bulk of the budget.

This is followed by Sub- programme 3 that received R115.5 million or 23 per cent whilst Sub-programme 5 received R108 million or 22 per cent of the budget.

Sub-programme 1 received R35.4 million or 7 per cent and Sub-programme 4 received the least amount of R11.7 million or 2 per cent.

The Administration Programme constitutes 0.5 per cent (R504 million) of the Department’s budget.
Expenditure in the Administration Programme is expected to decrease at an average annual rate of 7.2 per cent, from R504 million in 2021/22 to R495.7 million in 2023/24.
Table 5: Change to allocations per sub-programme for Programme 1 Sub-programmes: Administration Budget Nominal Percent change in 2021/22 Real Percent change in 2021/22 R million 2020/21 2021/22 1: 35,4 30,4 197,0 232,5 11,75% 16,45% Sub-Programme Department Management Sub-Programme 2: Corporate Management Services Sub-Programme 3: Office of the Chief Financial Officer Sub-Programme 4: Internal Audit Sub-Programme 5: Office Accommodation TOTAL Source: National Treasury (2021b) Table 5 shows that all sub-programmes budgets have increased, except sub-programme 4: Internal Audit which decreased by 5.64 per cent when inflation is considered.
38,66% 20,26% 44,49% 25,3% 75,3 402,2 108,8 504,0 18,02% 31,85% 26,53% 13,26% -1,68% -5,64% 115,5 11,7 87,6 11,9 Notable in table 5, is the fact that even though other sub-programmes such as sub-programme 3, 1 and 2 budget allocations increased by 31.85 per cent, 16.45per cent and 18.02 per cent respectively, Sub-programme 5: Office Administration had the largest increase at 44.49 per cent.

4.2.2.
4.2.2.

Programme 2: Planning, Policy and Strategy 13 238 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 sub-programmes for 2021/22; namely; Programme Management, Human Resource Development Council, Policy, Planning, Monitoring and Evaluation, International Relations, Legal and Legislative Services and Social Inclusion and Quality.
For the 2021/22 financial year, the budget allocation for this programme is R230.7 million.

The adjusted allocation for 2020/21 was R189 million, representing a nominal increase of R41.7 million or 22.1 per cent.

Taking inflation into consideration, the budget for this programme has increased by R32.4 million or 17.1 per cent.
Table 6: Budget allocations for all sub-programmes in Programme 2 Sub-Programmes: Planning, Policy and Strategy R million Sub-Programme 1: Programme Management: Planning, Policy and Strategy Sub-Programme 2: Human Resource Development Council of SA Sub-Programme 3:Policy, Planning, Monitoring and Evaluation Sub-Programme 4: International Relations Sub-Programme 5: Legal and Legislative Services Sub-programme 6: Social Inclusion and Quality TOTAL Source: National Treasury (2021b) Budget 2020/21 % Total programme Budget 14,9 10,7 29,2 18,7 21,0 136,3 230,7 6% 5% 13% 8% 9% 59% 100% The Planning, Policy and Strategy Programme constitutes 0.2 per cent (R230.7 million) of the Department’s budget.
Expenditure in the Planning, Policy and Strategy Programme is expected to increase at an average annual rate of 7.5 per cent, from R230.7 million in 2021/22 to R234.6 million in 2023/24.

Sub-programme 6 (Social Inclusion and Quality) receives the bulk of the programme budget at R136.3 million or 59 per cent.
Table 7: Change to allocations per sub-programme for Programme 2 Sub-programmes: Planning, Policy and Strategy Budget R million 2020/21 2021/22 Nominal Percent change in 2021/22 Real Percent change in 2021/22 Programme Sub-Programme Management: Planning, Policy and Strategy 1: 8,7 14,9 71,26% 64,36% 14 239 Planning, Sub-Programme 2: Human Resource Development Council of SA Sub-Programme 3:Policy, Monitoring and Evaluation Sub-Programme 4: International Relations Sub-Programme 5: Legal and Legislative Services Sub-programme 6: Social Inclusion and Quality TOTAL Source: National Treasury (2021b) 4.2.3.
Programme 3: University Education 8,2 10,7 30,49% 25,23% 24,4 14,6 29,2 18,7 19,67% 14,85% 28,08% 22,92% 13,9 21,0 51,08% 44,99% 119,3 189,0 136,3 230,7 14,25% 9,64% 22,1% 17,14% This Programme develops and coordinates policy and regulatory frameworks for an effective and efficient university education system.

In addition, it provides financial and other support to universities, NSFAS and national institutes for higher education.
The Programme has six sub-programmes for 2021/22, namely, Programme Management; University Planning and Institutional Funding; Institutional Governance and Management Support; Higher Education Policy Development and Research Teaching, Learning and Research Development and University Subsidies.

For the 2021/22 financial year, the budget allocation for this programme is R81.2 billion.

The adjusted allocation for 2020/21 was R78.3 billion, representing a nominal increase of R2.9 billion or 3.7 per cent.
Taking inflation into consideration, the budget for this programme has decreased by R372.1 million or 0.5 per cent.
Table 8: Budget allocations for all sub-programmes in Programme 3 Sub-Programmes: University Education R million Sub-Programme 1: Programme Management Sub-Programme 2: University Planning and Institutional Funding Sub-Programme 3: Institutional Governance and Management Support Sub-Programme 4: Higher Education Policy Development and Research Sub-Programme 5: Teaching, Learning and Research Development Sub-Programme 6: University Subsidies TOTAL Source: National Treasury (2021b) Budget 2020/21 % Total programme Budget 4,8 24,5 35 587,9 14,6 0,01% 0,03% 43,81% 0,02% 29,5 0,04% 45 561,9 81 223,3 56,09% 100% The University Education programme constitutes 83.1 per cent (R81.2 billion) of the department’s budget.
Transfers of Government subsidies to 26 universities through grants 15 240 constitute the bulk of spending in this programme and are projected to increase at an average annual rate of 3.5 per cent, from R45.5 billion in 2021/22 to R47.7 billion in 2023/24.
Transfer payments to the National Student Financial Aid Scheme for bursaries to support undergraduate students from poor and working-class backgrounds in universities and TVET colleges are projected to increase at an average annual rate of 1.5 per cent, from R35.1 billion in 2021/22 to R36.4 billion in 2023/24.

Expenditure in the University Education and Training Programme is expected to increase at an average annual rate of 2.6 per cent, from R81.2 billion in 2021/22 to R84.6 billion in 2023/24.
Sub-programmes 3 (Institutional Governance and Management Support) and 6 (University Subsidies) receive the bulk of the programme budget at R35.6 billion or 44 per cent and R45.6 billion or 56 per cent, respectively.
Table 9: Change to allocations per sub-programme for Programme 3 Sub-Programmes: University Education R million Sub-Programme 1: Programme Management Sub-Programme 2: University Planning and Institutional Funding Sub-Programme 3: Institutional Governance and Management Support Sub-Programme 4: Higher Education Policy Development and Research Sub-Programme 5: Teaching, Learning and Research Development Sub-Programme 6: University Subsidies TOTAL Source: National Treasury (2021b) Budget 2020/21 2021/22 Nominal Percent change in 2021/22 Real Percent change in 2021/22 4,4 4,8 9,09% 4,69% 21,1 24,5 16,11% 11,43% 35 195,4 35 587,9 1,12% -2,96% 10,0 14,6 46,00% 40,12% 20,2 29,5 46,04% 40,15% 43 070,5 78 321,5 45 561,9 81 223,3 5,78% 3,7% 1,52% -0,48% Table 9 shows that in real terms there is a minimal increase in budget for Sub-programmes 1, 2, 4,5 and 6 of 4.9 per cent, 11.43 per cent, 40.12 per cent,40.15 per cent and 1.52 per cent, respectively.
However, in real terms, there is a decrease in the budget for Sub-programme 3: Institutional Governance and Management Support of 2.96 per cent.

4.2.4.

Programme 4: Technical and Vocational Education and Training (TVET) This Programme plan develops, implements, monitors, maintains and evaluates national policy, programme assessment practices and systems for technical and vocational education and training.
In addition, it provides financial and other support to Technical and Vocational Education and Training colleges and regional offices.

16 241 The Programme has six sub-programmes for 2021/22, namely, Programme Management; TVET System Planning and Institutional Support; Programmes and Qualifications; National Examinations and Assessment; TVET Financial Planning and Regional Offices.

For the 2021/22 financial year, the budget allocation for this programme is R13.1 billion.
The adjusted allocation for 2020/21 was R12.7 billion, representing a nominal increase of R444 million or 3.5 per cent.

Taking inflation into consideration, the budget for this programme has decreased by R83.9 million or 0.66 per cent.
Table 10: Budget allocations for all sub-programmes in Programme 4 Sub-Programmes: Technical and Vocational Education and Training R million Budget 2020/21 % Total program me Budget Sub-Programme 1: Programme Management: Technical and Vocational Education and Training Sub-Programme 2: Technical and Vocational Education and Training System Planning and Institutional Support Sub-Programme 3: Programmes and Qualifications Sub-Programme 4: National Examinations and Assessment Sub-Programme 5: Technical and Vocational Education and Training Financial Planning Sub-programme 6: Regional Offices TOTAL Source: National Treasury (2021b) 4,7 0,04% 12 206,6 93,21% 22,7 593,2 16,5 252,6 13 096,2 0,17% 4,53% 0,13% 1,93% 100% The TVET Programme constitutes 13.5 per cent (R13 billion) of the Department’s budget.
Expenditure in the TVET Programme is expected to increase at an average annual rate of 1.5 per cent, from R13 billion in 2021/22 to R13.2 billion in 2023/24.

Sub-programme 2 (TVET System Planning and Institutional Support) receives the bulk of the programme budget at R12.2 billion or 93 per cent.
Transfer payments to 50 colleges, in the Technical and Vocational Education and Training System Planning and Institutional Support sub-programme in the Technical and Vocational Education and Training programme, are projected to increase at an average annual rate of 1.3 per cent, from R11.7 billion in 2020/21 to R12.2 billion in 2022/23.
Table 11: Change to allocations per sub-programme for Programme 4 Sub-Programmes: Technical and Vocational Education and Training Budget R million Sub-Programme 1: Programme Management: Technical and Vocational Education and Training 2020/21 2021/22 Nominal Percent change in 2021/22 Real Percent change in 2021/22 3,4 4,7 38,24% 32,66% 17 242 Sub-Programme 2: Technical and Vocational Education and Training System Planning and Institutional Support Sub-Programme 3: Programmes and Qualifications Sub-Programme 4: National Examinations and Assessment Sub-Programme 5: Technical and Vocational Education and Training Financial Planning Sub-programme 6: Regional Offices TOTAL Source: National Treasury (2021b) 11 763,1 12 206,6 3,77% -0,41% 17,9 22,7 26,82% 21,70% 581,2 593,2 2,06% -2,05% 12,4 274,2 12 652,2 16,5 252,6 13 096,2 33,06% -7,88% 3,5% 27,70% -11,59% -0,66% Table 11 shows that Sub-programme 1: Programme management, Sub-programme 3: Programmes and Qualifications and Sub-programme 5: TVET Financial Planning budgets increased by 32.41 per cent, 21.47 per cent and 27.46 per cent respectively when inflation is considered.
The table also shows that Sub-programme 2: Technical and Vocational Education and Training System Planning and Institutional Support, Sub-programme 4: National Examinations and Assessment and Sub-programme 6: Regional Offices budgets decreased by 0.6 per cent, 2.24 per cent and 11.76 per cent respectively when inflation is considered.

4.2.5.

Programme 5: Skills Development This Programme promotes and monitors the national skills development strategy.
Develop skills development policies and regulatory frameworks for an effective skills development system.

The Programme has five sub-programmes for 2021/22, namely, Programme Management; Sector Education and Training Authority Coordination; National Skills Authority Secretariat; Quality Development and Promotion and National Artisan Development.

For the 2021/22 financial year, the budget allocation for this programme is R307.9 million.
The adjusted allocation for 2020/21 was R282.6 million, representing a nominal increase of R25.3 million or 9 per cent.

Taking inflation into consideration, the budget for this programme has increased by R12.9 million or 4.56 per cent.
Table 12: Budget allocations for all sub-programmes in Programme 5 Sub-Programmes: Skills Development R million Sub-Programme 1: Programme Management: Skills Development Budget 2020/21 % Total programme Budget 6,2 2,01% 18 243 Sub-Programme 2: Sector Education and Training Authority Coordination Sub-Programme 3: National Skills Authority Secretariat Sub-Programme 4: Quality Development and Promotion Sub-Programme 5: National Artisan Development TOTAL Source: National Treasury (2021b) 157,5 51,15% 15,8 27,6 100,7 307,9 5,13% 8,96% 32,71% 100% The Skills Development Programme constitutes 0.3 per cent (R307.9 million) of the Department’s budget.
Expenditure in the Skills Development Programme is expected to increase at an average annual rate of 3.6 per cent, from R307.9 million in 2021/22 to R314.2 million in 2023/24.

Sub-programmes 2 (Sector Education and Training Authority Coordination) and 5 (National Artisan Development) receives the bulk of the programme budget at R157.5 million or 51.15 per cent and R100.7 million or 32.71 per cent, respectively.
Table 13: Change to allocations per sub-programme for Programme 5 Sub-Programmes: Skills Development R million Sub-Programme 1: Programme Management: Skills Development Sub-Programme 2: Sector Education and Training Authority Coordination Sub-Programme 3: National Skills Authority Secretariat Sub-Programme 4: Quality Development and Promotion Sub-Programme 5: National Artisan Development TOTAL Source: National Treasury (2021b) Budget 2020/21 2021/22 Nominal Percent change in 2021/22 Real Percent change in 2021/22 5,2 6,2 19,2 % 14,42% 149,8 157,5 5,14% 0,90% 9,5 15,8 66,32% 59,61% 25,5 27,6 8,24% 3,87% 92,5 282,6 100,7 307,9 8,86% 9,0% 4,48% 4,56% Table 13 shows that the budgets of Sub-programme 3: National Skills Authority and Sub- programme 1: Programme management increased in nominal terms by 66.32 per cent, 19.23 per cent respectively.
Whilst, and Sub-programme 5: National Artisan development, Sub- programme 4: Quality Development and Promotion and Sub-programme 2: Sector Education Authority Coordination budgets increased by 8.86 per cent, 8.24 per cent and 5.14 per cent respectively.
However, Sub-programme 5 received a minimal real increase of 4.28 per cent, yet it is significant in terms of realising both the White Paper on Post School and National Development Plan targets of producing 30 000 artisans per annum and thereby change the labour skills force.

19 244 4.2.6.
19 244 4.2.6.

Programme 6: Community Education and Training (CET) This Programme plan develops, implements, monitors, maintains and evaluates national policy, programme assessment practices and systems for community education and training.

It also provides financial and other support to community education and training colleges.
The Programme has four sub-programmes for 2021/22, namely, Programme Management; CET System Planning, Institutional Development and Support; CET Financial Planning and Management and Education, Training and Development Assessment.

For the 2021/22 financial year, the budget allocation for this programme is R2.4 billion.

The adjusted allocation for 2020/21 was R2.2 billion, representing a nominal increase of R174 million or 7.8 per cent.
Taking inflation into consideration, the budget for this Programme has increased by R77 million or 3.43 per cent.
Table 14: Budget allocations for all sub-programmes in Programme 6 Sub-Programmes: Community Education and Training R million Sub-Programme 1: Programme Management: Community Education and Training Sub-Programme 2: Community Education and Training System Planning, Institutional Development Sub-Programme 3: Community Education and Training Colleges Financial Planning and Management Sub-Programme 4: Education, Training and Development Assessment TOTAL Source: National Treasury (2021b) Budget 2020/21 % Total programme Budget 2,7 0,11% 2 181,7 90,08% 219,3 9,05% 18,3 0,76% 2 422,0 100% The CET Programme constitutes 2.5 per cent (R2.4 billion) of the Department’s budget.
Expenditure in the Community Education and Training Programme is expected to increase at an average annual rate of 4.6 per cent, from R2.4 billion in 2021/22 to R2.6 billion in 2023/24.

Sub-programme 2: CET System Planning, Institutional Development and Support receive the bulk of the programme budget at R2.1 billion or 90.1 per cent.
20 245 Table 15: Change to allocations per sub-programme for Programme 6 2: 1: Community Community and Training System Sub-Programmes: Education and Training R million Sub-Programme Programme Management: Community Education and Training Sub-Programme Education Planning, Institutional Development Sub-Programme Community Education and Training Colleges Financial Planning and Management Sub-Programme Education, Training and Development Assessment TOTAL Source: National Treasury (2021b) 4: 3: Budget 2020/21 2021/22 Nominal Percent change in 2021/22 Real Percent change in 2021/22 2,7 2,7 0,00% -4,03% 2 068,9 2 181,7 5,45% 1,20% 163,9 219,3 33,80% 28,41% 11,9 2 247,4 18,3 2 422,0 53,78% 7,8% 47,58% 3,43% Table 16 shows that the budgets of Sub-Programme 4: Education, Training and Development Assessment and Sub-Programme 3: Community Education and Training Colleges Financial Planning and Management increased in real terms by 47.58 per cent and 28.41 per cent, respectively.
Whilst Sub-Programme 2: Community Education and Training System Planning, Institutional Development had a minimal real increase of 1.2 per cent.

However, Sub- Programme 1: Programme Management: Community Education and Training decreased in real terms by 4.03 per cent since it did not receive an increase in budget for 2021/22.

5.

COMMITTEE OBSERVATIONS 5.1.


The Committee, having considered and deliberated on the Revised Strategic Plans 2020 - 2025 and Annual Performance Plans 2021/22 of the Department of Higher Education and Training made the following key observations and findings: • The Committee noted that the Minister of Finance had emphasized the need for fiscal consolidation in the economic downturn, and appealed to the Department to achieve its goals even with limited resources.
• Referring to what was said by the President during the State of the Nation Address (SONA), Members stressed the need to defeat the pandemic and achieve economic recovery, implement economic reform, stop corruption, and create jobs.

• Members referred to Agenda 2063 - eradicating all forms of gender-based violence (GBV) and discrimination against girls and women and enquired what the Department was doing 21 246 to ensure this was ended in the universities and TVETs.
They were also concerned that female students were not safe in TVET colleges' accommodation.

• Members also wanted to know whether there was budget set aside to ensure that females were given priority when it came to NSFAS and other government services that students must receive.

• Members pointed out that at the end of the third quarter, there was under-expenditure for programmes four and six, and potentially over-expenditure for programme three.
A question was raised as to whether there were reasons for these expenditure trends.

• Members noted that funds had to be reprioritised to accommodate the NSFAS shortfall and wanted to know how this affected the budget for other key programmes like infrastructure.

• Members further noted that Programme one had an increase of 25.3%.

A question was asked as to what the Department was planning to accommodate this budget increase.
• Members took note of the R24.6 billion reduction in the baseline budget that had been approved by Cabinet, of which R6.8 billion was removed from NSFAS loans and bursaries, R5 billion from university subsidies; and R947 million from TVET college infrastructure.

They were mainly concerned that the budget reduction was prevalent in all the core functions of the educational system.
They felt that the reduction, as well as the impact of the COVID- 19 pandemic, would place poor income and middle-class families in jeopardy.

Presently, the higher education institutions were already battling with tuition and residential payments, and historical debt was estimated to be at R14 billion.

• Members enquired whether the NSFAS laptops distribution from the year 2020 had been finalised.
• Members wanted to know how the Department supported the University of Cape Town (UCT) which recently had a big fire disaster and whether the assistance given for the library and the students affected was adequate.

• Members also indicated that, in one of the briefings, the Minister had referred to an established relationship with the Council for Scientific and Industrial Research (CSIR), which was meant for supplying laptops for students, loading of information, and network connectivity issues etc.
They requested progress of this ‘agreement.

• Members felt that the budget for PSET remained inadequate and unsustainable, and this led to key TVET and CET programmes being negatively affected.

• Members asked whether the Department had plans to build new TVET colleges in urban areas.

22 247 5.2.

Responses by the Department The Department gave the following responses: • The Department had allocated R60 million over the MTEF period towards the Higher Health entity in various higher learning institutions.
In the previous year it had supplied additional funding to ensure support for GBV and psycho-social support in the CET sector.

They had allocated R7 million per annum for a directorate-led unit to fight against GBV in the higher education sector.

The institutions receiving subsidies from the Department also had their own initiatives to support GBV programmes.

• Funds had been reprioritised for the NSFAS shortfall.
R3.3 billion was a contribution from the National Skills Fund, R3 billion from voted funds, and R2.5 billion from the universities.

This budget reduction had an impact on TVET colleges and universities, as the Department had to halt many plans to build, and may not be able to introduce new infrastructure programmes this year due to budget constraints.
• The budget increase observed in programme one was because slide 45 of the presentation had made a comparison with the adjusted budget allocation for the previous year, and compared it with the original budget allocation.

The Department indicated they should have added a column in the presentation where they also compared the original budget allocation for the previous financial year to the original budget allocation this financial year, because that way the increase was only 3.6%, which was little.
In September 2020, the Department had realised a potentially huge under-spending for programme one, and had made the necessary adjustments.

Most budget reprioritisations to key programmes were made from programme one.

The Department had experienced recruitment delays because of the lockdown, which accounted for under-spending and under-compensation of employees in programme one.
Eliciting responses, the Department added that the additional funding given over the MTEF period was the budget reprioritisation made from programme one, which was given to the South African Qualification Authority (SAQA), CET colleges (over R120 million), and to reduce the NSFAS shortfall.

• The Department agreed with the Committee's concerns over the adverse effects of the budget reprioritisation to support the NSFAS shortfall.
They reported that the infrastructure budget cuts last year had brought some projects to halt, and that some projects this year, such as the new funding for information technology (IT) infrastructure, would have to be 23 248 postponed.

The primary focus of the budget reprioritisation was to protect the core operational budgets of the institutions.

As such, the Department had tried to restrict the reductions to areas where they could either postpone projects, or earmark grounds.
• Regarding the policy review process, the Department had gone to Cabinet in March and had requested to return by the end of June with proposals on how to continue sustainable student funding through NSFAS.

Some projects related to medium-term projections would be attended to immediately, while other projects would continue in the longer period, such as funding of the missing middle/post-graduate students.
The Department was, however, concerned about the growing budget for student funding and the requirements for sustaining this budget for the whole PSET system, and its effect on universities, TVET and CET colleges, and skills development.

• The Deputy Minister had visited UCT during the previous weeks to see the damage caused by the fire.
The Department of Higher Education and Training as well as the Department of Health provided support, particularly when students were evacuated from their residences for a short period, and some students had had to be re-housed.

The big devastation was the damage caused to the library and its special collections.

The university was establishing where there was digitised material, and which materials had been lost.
The university was insured to cover the cost of the damage, but the Department would continue to engage them for support.

The Department had observed that UCT had acted instantly to ensure the safety of their staff members and students.

There was, however, a brief disruption to the academic calendar, but the university had managed to resume a week after the fire.
It was also able to mobilise extraordinary support from the private sector and non- governmental organisations (NGOs), like the ‘Gift of the Givers’.

The Department was in discussion with the university on the long-term effects of this fire, and how best to assist them.

• Not all the institutions were using the NSFAS process for acquiring laptops.
In 2020, for instance, many students received their laptops through the institutions delivering devices to them, whilst some institutions took different routes, like delivering hard copies to their students.

NSFAS had ordered 170 00 laptops, some of which had arrived last week and were being distributed.

NSFAS had experienced a delay because of the international demand for laptop components and delayed manufacturing from some providers.
However, it had concluded its tender agreement last year and had appointed service providers.

It was estimated that most of the laptops would be distributed towards the middle of this year, and that the Department would provide the Committee with an update.

24 249 • Regarding the CSIR, the Department’s understanding was that they would assist with a review of the connectivity around the country so that they had a sense of which areas had good or bad network connectivity.
• The Department was concerned about the budget reduction for TVET college infrastructure.

They were, however, committed to increasing the number of college campuses available, and finding other modes of delivery for the curricula, like e-learning platforms.

• The Department had received several requests to build new TVET colleges, but the requests were dealt with on a needs-based analysis.
Presently, the focus was aligned with the preamble to the CET Act, which was to prioritise previously disadvantaged areas.

TVET colleges were of importance, as they provided the skills required to grow the economy.

6.
6.

RECOMMENDATIONS The Committee, having considered the Strategic Plan 2020 – 2025 and Annual Performance Plan 2020/21 of the Department of Higher Education and Training recommends that the Minister of Higher Education, Science and Innovation consider the following: 6.1 The Department should review its funding model to ensure sustainable funding for TVET College infrastructure and the NSFAS model.
6.2 The Department should focus its budget allocation more on TVET Colleges so as to encourage students to opt for TVET College Programmes, which were more beneficial for the economy.

6.3 The Department should provide the Committee with an update with regard to the distribution of laptops.

7.
7.

Conclusion Having satisfied itself in its engagement with the Department of Higher Education and Training on their Annual Performance Plan and the Budget, the Select Committee on Education and Technology, Sport, Arts and Culture recommends that Budget Vote 17: Higher Education and Training be adopted and that the House approves Budget Vote 17: Higher Education and Training.

Report to be considered.

25 250 13.
Report of the Select Committee on Education and Technology, Sport, Arts and Culture on Budget Vote 35: Science and Innovation (2021/22), dated 02 June 2021 The Select Committee on Education, Technology, Sport, Arts and Culture (hereinafter referred to as the Committee), having considered Budget Vote 35: Science and Innovation, the revised 2020-2025 Strategic Plan and the 2021/22 Annual Performance Plan (APP) of the Department of Science and Innovation (hereinafter referred to as the Department), reports as follows: 1.
Introduction 1.1.

Purpose of the Budget Vote 35 Report The purpose of this report is to account for work done by the Committee in considering the revised 2020 - 2025 Strategic Plan and 2021/22 Annual Performance Plan (APP) and budget of the Department in accordance with Section 27(1) of the Public Finance Management Act, 1999 (Act.

No 29 of 1999), and as referred by the Chairperson of the National Council of Provinces (NCOP) to the Committee in terms of Rule 338 for consideration and reporting.

1.2.
1.2.

Method The revised 2020 - 25 Strategic Plan, 2021/22 APP as well as budget of the Department was 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 2020 State of the Nation Address (SONA).

The Committee had a briefing session to consider the Strategic Plans and the APP of the Department on 19 May 2021.

1.3.
1.3.

Mandate of Committee and the Department The mandate of Parliament is based on the provisions of the Constitution of the Republic of South Africa, 1996, establishing Parliament and setting out the functions it performs.

Parliament’s role and outcomes are to represent the people and ensure government by the people under the Constitution, as well as to represent the provinces and local government in the national sphere of government.
The main functions of Parliament as outlined in the Constitution are: • To pass legislation, • To oversee executive action, • Facilitation of public involvement, co-operative government and, • International engagement.

Page 1 251 The Department’s mandate is to generate knowledge for the utilisation of economic and social development.
The Department derives its mandate from the following: Policy mandate: White Paper on Science, Technology and Innovation Succeeding the 1996 White Paper on Science and Technology, the 2019 White Paper on Science, Technology and Innovation, which seeks to specifically enhance the role of innovation, now sets the current long-term policy direction for the National System of Innovation (NSI) and seeks to ensure an increasing role for science, technology and innovation (STI) to accelerate inclusive economic growth, increase the competitiveness of the economy, and improve the livelihoods of South Africa’s citizens.
The 2019 White Paper hinges on three high-level goals; namely to, take advantage of opportunities presented by megatrends and technological change; expand policy approaches that have worked and propose new approaches, where necessary; and promote a more inclusive economy at all levels.
These goals are underpinned by the following objectives: • • • • • • • • Adopt a whole-of-government/society approach to innovation; Instil a culture of valuing STI, and integrate STI into government planning and budgeting at the highest levels; Create an enabling and inclusive governance environment; Create a more innovation-enabling environment; Increase and transform NSI human capabilities; Expand and transform the research system; Expand and transform the institutional landscape; and Increase funding and funding efficiencies.
A new Decadal Plan for STI will serve as the implementation plan for the 2019 White Paper.

This Decadal Plan will take into consideration not only the policy intents of the 2019 White Paper, but also the reviews of the Ten-Year Innovation Plan (2008–2018) and 2002 National Research and Development Strategy, the 2019 National Advisory Council on Innovation’s (NACI) South Africa Foresight Exercise for Science, Technology and Innovation 2030 report, and the priority outcomes of government.
It is envisaged that this Plan will be finalised within the 2020/21 financial year.

2 252 Policy context: National Develop Plan and the Medium Term Strategic Framework The National Development Plan (NDP) characterises STI as crucial for development since countries that have effectively alleviated poverty by growing their economies, have done so by investing in and developing strong STI environments and capabilities.
Hence, the NDP states that South Africa’s NSI needs to be expanded as well as be more effective and, therefore, be aligned with the sectors that will realise the country’s growth objectives.

This requires that: • South Africa invests more in research and development (R&D).
The target was 1.5% of GDP invested in R&D by 2019; • The STI institutional arrangement improves the link between innovation and the productive needs of industry; • Government should collaborate with the private sector to raise the level of R&D in companies; and • Public investments in research infrastructure should be focussed on and fulfil the needs of a modern economy.
The 2014-2019 Medium Term Strategic Framework (MTSF) served as the first phase of implementation of the NDP and committed Government to 14 key outcomes.
The Department contributed to Outcome 2: A long and healthy life for all South Africans; Outcome 3: All South Africans are safe and feel safe; Outcome 4: Decent employment through inclusive economic growth; Outcome 5: A skilled and capable workforce to support an inclusive growth path; Outcome 6: An efficient, competitive and responsive economic infrastructure network; Outcome 7: Vibrant, equitable and sustainable rural communities and food security for all; and Outcome 10: Protect and enhance South Africa’s environmental assets and natural resources.
Achievement against these Outcomes is mixed and true transformation of the economy, the environment and society continues to elude South Africa, who still faces the challenges of poverty, inequality and unemployment.

The 2019-2024 MTSF, representing the second five-year phase of implementation for the NDP, aims to address these challenges through three pillars; namely, achieving a more capable state; driving a strong and inclusive economy; and building and strengthening the capabilities of South Africans.
These three pillars underpin the seven priorities of the 2019-2024 MTSF, which are translated through 81 outcomes, 337 interventions and 561 performance indicators.

3 253 2.

Overview and assessment of the Department’s 2020/2025 Strategic Plan 2.1.
Overview by the Minister The Minister of Higher Education, Science and Technology, Dr BEB Nzimande, in bringing context to the Department’s 2021/22 APP, reminded the Committee that the DSI and the Department of Higher Education and Training (DHET) were brought together under one ministry under the sixth administration.

By so doing, the hope was that South Africans would receive much better coordinated and cost-effective services.
In support of South Africa’s (SA's) economic recovery plan, the two departments had developed Skills development and Science and Innovation strategies which were presented to the Cabinet Lekgotla in January.

This would enable the Department to positively respond to what was required to develop the economy during the COVID-19 pandemic.
Guided by the vision contained in the National Development Plan (NDP), the 2021/22 APP was the third APP for the implementation of the 2020-2025 strategic plan of the Department.

When the Department's strategic plan was tabled in Parliament in 2019, Cabinet had just approved the 2019 White Paper on Science, Technology and Innovation, and work on the Decadal Plan was under way after the adoption of the White Paper.
The Minister reminded the Committee that he had said he would review the strategic plan after the finalization of the Decadal Plan.

He thus informed the Committee that Cabinet had recently approved the Decadal Plan.
He indicated that work was already in progress for setting up the two government structures provided in the White Paper; the annual Science, Technology and Innovation plenary, which was a stakeholder body representing government and other stakeholders, convened by President Cyril Ramaphosa; and the inter-ministerial committee on Science, Technology and Innovation (STI).
The overall aim of these structures was to enhance the responsiveness of the National System of Innovations (NSI) to the country’s social and economic challenges, and to improve the coordination of STI matters across all government levels.
It was expected that the current strategic plan would be comprehensively reviewed during the current planning cycle, meaning that the 2021/22 APP that was being presented to the Committee would be the last one to be based entirely on the original 2020-2025 strategic plan.

The NSI's responsiveness to the COVID- 19 pandemic provided an important background to the Department’s APP, because it was informed by the lessons learnt from the previous financial year.
The global pandemic had made the role of STI very significant for South Africa.

Despite a relatively small budget, the Department had invested in infrastructure to enable world class research in areas such as genomics, epidemiology, vaccine manufacturing and so forth.

The Department had also invested in human resource (HR) development to ensure a plan of knowledge workers to advance the country’s scientific endeavors.
The HR development strategy was inclined towards 4 254 affirming black people, women and supporting young people, so that the demographic of the scientific community improved and thus continued transformation.

The investments and talents of the NSI had seen the country produce premier science that was also contributing to the global body of knowledge of the COVID-19 pandemic.
The Minister reported that local scientists had detected a new corona virus variant (501YV2), which had several mutations that increased the ability for the virus to infect humans and potentially enabled the virus to escape certain vaccines.

To ensure the completion of the sequencing of 10 000 COVID-19 genomes in SA and Africa, the Department was investing a further R25 million towards this noble work.

Such work was crucial in shaping the country’s ongoing responses to the COVID-19 pandemic.
The Department had also invested R69.4 million in COVID- 19 research and innovation which covered 21 projects.

Notable among them was the first plant-based manufacturing of anti-bodies for COVID-19 study, which seeks to utilise various plant-based platforms to facilitate the rapid development of vaccine candidates that were putting antibodies and diagnostic reagents against what was called Sars COVID-2.
To ensure that the NSI was transformed, inclusive, responsive, and coherent, historically disadvantaged universities and individuals would receive targeted development funding support to ensure that they too contribute to the research and knowledge enterprise.

This included the implementation of the new postgraduate funding policy that provides full support for financially disadvantaged students, students with disability, and students with exceptional academic achievements.
The Minister proudly indicated that female representation in the NSI scientific workforce had increased to 46%, which was remarkable for gender equity in the STI space.

The Department would also support the development of critical high-end skills in selected technology areas such as the bio-economy, space science, technology energy, intellectual property management, etc.
Support would also be directed towards technical development and the artisan skills that would contribute to the deployment of newly developed innovations.

The Department was a national department, and therefore did not have a provincial/ local footprint in terms of structures, and this may at times create a challenge for national STI interventions.
However, through the Regional Innovations Support (RIS) programme, the Department was contributing to the development of innovation ecosystems in various regions of the country.

In this regard, the Department was engaged in a concerted effort to increase their spatial footprint of innovation support to enable localized and regional socio-economic development.
The Department would be studying provincial growth and development, and 5 255 local economic development strategies to enable better alignment with its innovation support interventions, particularly the district development model (DDM).

The Minister urged the Committee to also focus its oversight on the role of STI in both the public and private spheres in DDM programmes.

This was where the National Council of Provinces (NCOP) could significantly enhance its own role in the Department’s NSI.
In this regard, the Department would be piloting technologies that facilitate service delivery to ensure appropriate technology deployment for waste and water management, housing and sanitation, and energy provision etc.

The Department would also prioritise and develop capacity to use 5G and other wireless technologies optimally, to enable the state and citizens to take advantage of digital economy opportunities.

2.2.
2.2.

The 2020-2025 Strategic Plan The Department has tabled a Revised 2020 – 2025 Strategic Plan.

This was necessitated by the updated 2019-2024 MTSF.

South Africa like many world countries has experienced the COVID-19 pandemic which had an adverse socio-economic impact.

In South Africa, the pandemic had exacerbated the already weak economic growth and further strained the country’s fiscus.
Government has put in place plans for economic recovery, for example, the pronouncement of the Economic Reconstruction and Recovery Plan (ERRP).

The Plan stresses the skills development, science and innovation as not only critical in driving South Africa’s economic reconstruction and recovery post-pandemic but also key in sustaining it.

The revised 2019-2024 MTSF has maintained the seven Apex Priorities as derived from the electoral mandate and the President’s State of the Nation Address.
However, the priorities have been re-arranged.

Education, Skills and Health was Priority 3 and has been moved to Priority 3.

Of importance to note is that Priority 6: Capable, Ethical and Development has been moved to be Priority 1.

Additionally, the revised MTSF stresses improved coordination, integrated planning and efficiency of service delivery to ensure medium to long-term recovery and inclusive development.
President Ramaphosa in his foreword in the MTSF document notes that the Sixth Government Administration is giving priority to integrated planning, implementation, accountability and service delivery.

It is also committed to consequence management for non-performance and non-delivery.

In response to the call by the President for economic recovery, the Department has introduced a new indicator under Programme 5.
The funds to implement this indicator titled “Number of Presidential Youth Employment Initiative (PYEI) beneficiaries” are separate to the Department’s allocation.

An amount of 6 256 R67,811,773 has been tentatively secured from the Presidency for the 2020/21 financial year towards this indicator linked to the PYEI.
In recognition of innovation as a strategic enabler in improved service delivery and access to government services, the Department has also introduced a new performance outcome aimed at expanding the use of innovation in building a more responsive and capable developmental state.

3.
3.

2021/22 Medium-Term Expenditure Framework (MTEF) Budget: Vote 35 The President stated in the 2021 State of the Nation Address (SONA) that the overriding priorities of 2021 were to (i) defeat the coronavirus pandemic, (ii) accelerate economic recovery, (iii) implement economic reforms to create sustainable jobs and drive inclusive growth, and (iv) strengthen the state and fight corruption.
The Department’s 2020-2025 Strategic Outcomes details how STI can support/drive the realisation of these priorities.

In particular, the COVID-19 pandemic elicited an unprecedented deployment of the global science and innovation community, and undeniably, offers the only exit strategy from COVID- 19.

Furthermore, digital technologies have played a pivotal role in ensuring that certain businesses maintain their operations.
This enabled parts of the economy and society to continue working; thereby, mitigating the impacts of the pandemic.

It has also exacerbated the great inequalities that exist among societies.

The pandemic has emphasised the importance of science and innovation to both prepare for and react to future crises, and has highlighted the need to ensure that STI policies direct RDI efforts towards achieving socio-economic and environmental sustainability, inclusivity and resilience.
The 2021 Budget is framed by the two policy objectives set out in the 2020 Medium Term Budget Policy Statement (MTBPS), which are to promote economic recovery and return public finances to a sustainable position.

Hence, fiscal policy continues to focus on short-term economic support, pro-growth fiscal consolidation and debt stabilisation.
The 2021 Budget proposes total consolidated spending of R2.02 trillion, with 56.8% of allocations going to learning and culture (R402.9 billion), health (R248.8 billion) and social development (R335.3 billion).

Rising debt-service costs consume R269.7 billion, or 13.4% of the budget.
The 2021/22 consolidated government expenditure for innovation, science and technology is R17.4 billion (R15.4 billion in 2020/21, revised estimate), which is 1% of the total Medium Term Expenditure Framework (MTEF) allocation and 8.4% of the consolidated economic development expenditure of R207.5 billion.
Over the medium term, the Department has set aside R5.3 billion to scale up interventions supporting the local production of ventilators, nano-satellites, hydrogen fuel cell technologies, and renewable energy R&D and pilots such as the KwaZulu- 7 257 Natal Research Innovation and Sequencing Platforms (KRISP).
Furthermore, the Department and National Treasury will publish, in 2021, a discussion paper inviting public comment on the future of the Research and Development Tax Incentive, which expires on 1 October 2022.
In relation to public-sector infrastructure, the Space Infrastructure Hub, allocated R4.5 billion sourced through the President’s sustainable infrastructure development symposium, ito support a South African National Space Agency (SANSA) programme that aims to use space data as a tool for national development and supporting commercial uses in areas such as remote sensing, navigation and space sciences.
The hub will allow for the development of satellite infrastructure, satellite-based augmentation systems and earth observation satellites.

Over the medium-term, the Department will focus on producing new knowledge; generating and exploiting knowledge and innovation for inclusive economic development; health care innovation; developing human capital; developing infrastructure; and championing innovation in the energy sector.
The Department’s allocation, over the medium term, is expected to increase at an average annual rate of 8.3% from R7.3 billion in 2020/21 to R9.2 billion in 2023/24.

For this period, R25.6 billion is allocated for Transfers to entities for investment in key focus areas.
However, over the medium term, Cabinet approved budget reductions of R1.7 billion, which has been effected on compensation of employees (natural attrition and not filling vacant posts); selected goods and services items; and transfers to public entities.

The Department’s 2021/22 budget allocation increases from R7.3 billion in the 2020/21 financial year to R8.9 billion.
This represents, when adjusted for inflation, a real increase of 17.8% and closely returns the Department’s allocation to what it was in 2020 (R8.8 billion) before the budget cuts to meet the needs of the national COVID-19 response.
In terms of economic classification, the apportionment of the Department’s 2021/22 budget allocation of R8.9 billion remains the same as in previous years and comprises Current payments of R566.5 million (6.3%), Transfers and subsidies of R8.4 billion (93.6%), which increases from R6.8 billion in 2020/21, and Payments for capital assets of R2.9 million (0.03%).
Notable changes in allocations include: Goods and services: • The allocation for Consultants: Business and advisory services increases from R13.6 million to R21.8 million.

• The allocation for Travel and subsistence increases to pre-2020 levels, from R19.2 million to R60.6 million.

8 258 Transfers and subsidies: • The allocation for Innovation projects research increases from R171.4 million to R503.3 million.
This allocation supports innovation activities and aims to increase, commercialise and use publicly funded IP.

• The allocation for Science awareness and initiatives to encourage youth participation in science increases from R33.5 million to R91.6 million.

• The allocation for the Square Kilometre Array’s (SKA) capital contribution to research increases from R456.6 million to R802.4 million.

This is driven by the additional 20 antennae that will be added to the MeerKAT.
• The allocation to the Council for Scientific and Industrial Research (CSIR): Mining R&D increases • from R41.7 million to R63.5 million.

• The allocation to the CSIR: Cyberinfrastructure R&D increases from R60.2 million to R272.1 million.

This is the next tranche of funding to enhance the National Integrated Cyberinfrastructure System, which is allocated R3.6 billion over the medium term.
The 2020 Special Adjustment Budget impacted the Department’s plans in the following broad areas: • Infrastructure (the SKA, the National Integrated Cyber Infrastructure System and the South African Research Infrastructure Roadmap).

• Human capital development in designated areas of advanced manufacturing, aerospace, chemicals, mining, advanced manufacturing, ICTs and the Industry Innovation Programme, including the Sector Innovation Fund and the green economy.

• Science awareness initiatives.


• Knowledge and innovation products generated.

The 2021/22 budget allocation seems to restore these funding commitments to 2020 levels and focuses more strongly on innovation activities.

Transfers to the Department’s entities, receive 94.7% of the Department’s total budget allocation.

For 2021/22, the Department has translated its planned performance into 53 performance indicators.

3.1.
3.1.

Programme analysis The Department’s budget funds five programmes, namely: 9 259 • Programme 1: Administration • Programme 2: Technology Innovation • Programme 3: International Cooperation and Resources • Programme 4: Research, Development and Support • Programme 5: Socioeconomic Innovation Partnerships.

These programmes fulfil the Department’s mandate of realising the full potential of STI in social and economic development.
The percentage budget allocation to the Programmes remains essentially the same as in previous financial years.

Programmes 2, 4 and 5 that are responsible for these key STI programmes as tabulated below including their purposes and funding allocation to deliver on the targets as set under each programme.

Table 1: DSI Programmes and budget allocation for 2021/22 Programme Purpose No.
of targets per programme Budget (R' million) Programme 1: To provide strategic policy and planning 6 328.2 Administration alignment, ensure effective governance, risk management, and monitoring and evaluation (M&E) within DSI and among entities, and provide strategic science communication and branding of the activities of the DSI, its entities and the national system of innovation (NSI).
Programme 2: To promote technology development and 15 1 780.2 Technology Innovation the protection and utilisation of publicly funded intellectual property for innovation with socio-economic impact.

Programme 3: To develop, promote and manage 9 146.6 International Cooperation international partnerships that strengthen and Resources the national system of innovation (NSI) and enable the exchange of knowledge, 10 260 Programme Purpose No.
of targets per programme Budget (R' million) capacity, innovation and resources between South Africa and its international partners, particularly in Africa, in support of South African foreign policy through science, knowledge and innovation diplomacy.
Programme 4: Research To provide an enabling environment for 13 4 949.2 Development and research and knowledge production that Support promotes the strategic development of basic sciences and priority science areas, through science promotion, human capital development, and the provision of research infrastructure and relevant research support, in pursuit of South Africa’s transition to a knowledge economy.
Programme 5: Socio- To enhance the growth and development 10 1 729.0 economic Innovation priorities of government through targeted Partnerships S&T-based innovation interventions and the development of strategic partnerships with other government departments, industry, research institutions and communities and the provision of statistics and analysis for purposes of system-level monitoring and evaluation.

TOTAL 53 8 933.3 Sources: Estimates of National Expenditure (ENE) 2021 and DSI APP 2021/22 3.1.1.
Programme 1: Administration This programme provides strategic policy and planning alignment, ensure effective governance, risk management, and monitoring and evaluation (M&E) within DSI and among entities, and provide strategic 11 261 science communication and branding of the activities of the DSI, its entities and the national system of innovation (NSI).

There are six targets set for the 2021/22 financial year.
The total budget allocation for this programme is R328.2 million including transfers to department agencies and payments for capital assets.
For the 2021 MTEF period, Programme 1 has four sub-programmes: • Sub-Programme 1: Ministry; • Sub-Programme 2: Institutional Planning and Support; • Sub-Programme 3: Corporate Services; and • Sub-Programme 4: Office Accommodation For 2021 MTEF, the branch aims to ensure that: • DSI public entities’ 2021/22 Annual Performance Plans (National Research Foundation (NRF); Human Science Research Council (HSRC); Technology Innovation Agency (TIA); South African National Space Agency (SANSA); National Advisory Council of Innovation (NACI); South African Council for Natural Scientific Professions (SACNASP); Academy of Science of South Africa (ASSAF) and Council for Scientific and Industrial Research (CSIR) shareholder compact signed by the Minister and Chairpersons of the board by 31 March 2022; • 85% of all approved funded positions filled by 31 March 2022; • Unqualified audit opinion with no financial matters in the audit report from the Auditor- General by 30 September 2021; • Six platforms (print, broadcast, online, media liaison, stakeholder engagement and social media) to profile the DSI and its entities by 31 March 2021; • Two National thematic campaigns report on the branding roll-out initiatives by 31 March 2022; and • Special focus will be to ensure that the Decadal plan finalised and approved by Cabinet by 30 June 2021.
Spending over the medium-term is projected to grow by 3.1 per cent with the following spending projections: the budget for compensation of employees will decrease by 0.3%, while goods and services and travel and subsistence will grow by 8.4 per cent and 46 per cent respectively.

3.1.2.

Programme 2: Technology Innovation 12 262 This programme promotes technology development and the protection and utilisation of publicly funded intellectual property for innovation with socio-economic impact.
There are 15 targets set for the 2021/22 financial year.

The total budget allocation for this programme is R1 780.2 billion.

For the 2021 MTEF period, Programme 2 has six sub-programmes: • Sub-Programme 1 Space Science; • Sub-Programme 2: Hydrogen and Energy; • Sub-Programme 3: Bio-innovation; • Sub-Programme 4: Innovation Priorities and Instruments; • Sub-Programme 5: National Intellectual Property Management Office; and • Sub-Programme 6: Office of the Deputy Director-General: Technology Innovation.
For the MTEF, Programme 2 in its quest to provide strategic direction in the development, the branch’s focus will initiate the following policy pieces: Innovation Fund (previously called the Sovereign Innovation Fund) to support the commercialisation of locally developed IP; the amendment of the Intellectual Property Rights (IPR) Act; Institutional Review of TIA and SANSA; Business case for commercial space launch capability in South Africa and Hydrogen Society Roadmap; For 2021 MTEF, the branch aims to ensure that: • 2 decision-support tools developed by 31 March 2022; • 8 strategic and technical engagements with SANSA and TIA to align the national priorities by 31 March 2022 (Non-Cumulative target); • 3 new Products and/or Services developed (linked to High Frequency Propagation and/or Global Navigation Satellite System applications) by 31 March 2022 (Cumulative target); • Launch of 3 CubeSats for MDASat constellation by 30 December 2021 (Non-cumulative target); • 190 of postgraduate students (master’s and doctoral) supported in designated energy, space, Innovation Priorities and Instruments and bio-economy areas by 31 March 2022 (Non-cumulative target); • 20 artisans and/or technicians trained in space, energy and bio-economy by 31 March 2022 (Non- cumulative target).
Spending over the medium term is projected to grow by 9.2 per cent with the following spending projections: the budget for compensation of employees will decrease by 0.3 per cent, while goods and services, agency 13 263 and support/outsourced services, travel and subsistence and entertainment will grow by 24.5 per cent, 25.1 per cent, 41.5 per cent and 86 per cent respectively.

3.1.3.
3.1.3.

Programme 3: International Cooperation and Resources This programme is responsible to develop, promote and manage international partnerships that strengthen the national system of innovation (NSI) and enable the exchange of knowledge, capacity, innovation and resources between South Africa and its international partners, particularly in Africa, in support of South African foreign policy through science, knowledge and innovation diplomacy.

There are 9 targets set for the 2021/22 financial year.
The total budget allocation for this programme is R146.6 million.
For the 2021 MTEF period, Programme 3 has four sub-programmes: • Sub-Programme 1: Multilateral Cooperation and Africa; • Sub-Programme 2: International Resources; • Sub-Programme 3: Overseas Bilateral Cooperation; and • Sub-Programme 4: Office of the Deputy Director-General: International Cooperation and Resources; For the MTEF, Programme 3 will focus on developing and coordinating policies and regulatory frameworks to steer an African Strategy and European Union (EU) engagements.
For the 2021 MTEF, the branch aims to ensure that: • 43 dedicated international resource-leveraging engagements undertaken by 31 March 2022 (Non- cumulative target); • 326 new South African students participating in international training programmes as part of cooperation initiatives facilitated by DSI by 31 March 2022 (Non-cumulative target); • 32 capacity-building initiatives for international cooperation specifically targeting historically; disadvantaged institutions and individuals by 31 March 2022 (Non-cumulative target); • 34 international policy dialogues and technical exchanges the policy intents of the White Paper on STI by 31 March 2022(Non-cumulative target); • 15 new STI initiatives supporting Agenda 2063 by 31 March 2022 (Non-cumulative target); 14 264 • 17 new STI initiatives supported targeting the objectives of the Southern African Development Community Regional Indicative Strategic Development Plan (SADC RISDP) by 31 March 2022 (Non- cumulative target).
Spending over the medium term is projected to grow by 8.6 per cent, with the following spending projections: the budget for compensation of employees will decrease by 0.3 per cent, with an increase of 80.8 per cent for goods and services, 122.1 per cent of agency and support/outsourced services, 181.6 per cent of travel and subsistence and 228.3 per cent of venues and facilities.

3.1.4.
3.1.4.

Programme 4: Research Development and Support This programme provides an enabling environment for research and knowledge production that promotes the strategic development of basic sciences and priority science areas, through science promotion, human capital development, and the provision of research infrastructure and relevant research support, in pursuit of South Africa’s transition to a knowledge economy.

There are 13 targets set for the 2021/22 financial year.
The total budget allocation for this programme is R4 949.2 billion.
For the 2021 MTEF period, Programme 4 has five sub-programmes: • Sub-Programme 1: Human Capital and Science Promotions; • Sub-Programme 2: Science Missions; • Sub-Programme 3: Basic Science and Infrastructure; • Sub-Programme 4: Astronomy; and • Sub-Programme 5: Office of the Deputy Director-General: Research, Development and Support; For the MTEF, Programme 4 will continue to plan and develop the policy initiatives that seek to address: National Open Science Policy; Recognition of research outputs produced by research institutions (excluding universities); DSI/NRF Postgraduate Funding Policy; Reporting on postgraduate support across all DSI Programmes; PhD Tracer study; Astro-tourism strategy and Astronomy institute.
For 2021 MTEF, the branch aims to ensure that: • 2 000 PhD students awarded bursaries annually as reflected in the reports from the NRF and other relevant entities by 31 March 2022 (Cumulative target); 15 265 • 200 pipeline postgraduate students awarded bursaries annually as reflected in the reports from the NRF and other relevant entities by 31 March 2022 (Cumulative target); • 750 graduates and students placed in DSI-funded work preparation programmes in Science, Engineering, Technology and Innovation (SETI) institutions by 31 March 2022 (Cumulative target); • 25 research infrastructure grants awarded by 31 March 2022 (Non-cumulative target); • 5 800 gigabits per second (Gbps) total available broadband capacity provided by SANReN by 31 March 2022 (Non-cumulative target).
The spending over the medium term is projected to grow by 11.5 per cent, with the following spending projections: the budget for compensation of employees will decrease by 0.3 per cent, while spending on goods and services, administrative fees, travel and subsistence and venues and facilities will increase by 24.1 per cent, 34,9 per cent, 42.6 per cent and 46.4 per cent respectively.

3.1.5.
3.1.5.

Programme 5: Socio-economic Innovation Partnerships This programme aims to enhance the growth and development priorities of government through targeted S&T-based innovation interventions and the development of strategic partnerships with other government departments, industry, research institutions and communities and the provision of statistics and analysis for purposes of system-level monitoring and evaluation.

There are 10 targets set for 2021/22 financial year.
The total budget allocation for this programme is R1 729.0 billion.

For the 2021 MTEF period, Programme 5 has five sub-programmes: • Sub-Programme 1: Sector Innovation and Green Economy; • Sub-Programme 2: Innovation for Inclusive Development; • Sub-Programme 3: Science and Technology Investment; • Sub-Programme 4: Technology Localisation, Beneficiation and Advanced Manufacturing; and • Sub-Programme 5: Office of the Deputy Director-General: Socioeconomic Innovation Partnership.
For the 2021 MTEF, Programme 5 will continue to plan and develop the policy initiatives that seek to: Improve inclusion and build more linkages across the NSI (White Paper Policy Intent 3.2); enhance policy coherence and programme coordination in the NSI (White Paper Policy Intent 3.3; expand the NSI – Expansion of the scientific knowledge base of the NSI (White Paper Policy Intent 3.5); Upgrade M&E and 16 266 policy capacity (White Paper Policy Intent 3.6); Adopt a broader conceptualisation of innovation beyond R&D (White Paper Policy Intent 4.3) and Use public procurement as a vehicle to further innovation (White Paper Policy Intent 4.5).
For the 2021 MTEF, the branch aims to ensure that: • 4 knowledge products on innovation for inclusive development published by 31 March 2022 • (Cumulative target); • 6 decision-support systems introduced, maintained and improved by 31 March 2022 (Cumulative target); • 3 learning interventions (seminars/policy round tables) hosted by 31 March 2022 (Cumulative target); • 392 high-level research students (of which 57 at PhD level) fully funded or co-funded in designated niche areas (advanced manufacturing, aerospace, chemicals, mining, advanced • metals, ICTs, the Industry Innovation Programme – incl.
SIF, and green economy) by 31 March 2022 (Non-cumulative target; • 60 industrially relevant knowledge and innovation products (patents, prototypes, technology demonstrators or technology transfer packages) added to the industrial development and green economy IP portfolio by 31 March 2022 (Cumulative target).
Spending over the medium term is projected to grow by 0.8 per cent, with the following projections: the budget for compensation of employees will decline by 0.3 per cent, while goods and services, consultants: business and advisory services and travel and subsistence will grow by 12.1 per cent, 16.4 per cent and 23.8 per cent respectively.

3.2.
3.2.

2021/22 Infrastructure Projects The Department’s 2021/22 infrastructure projects include the following: • The Square Kilometer Array (SKA); • South African Research Infrastructure Roadmap (SARIR); and • The National Integrated Cyberinfrastructure System (NICIS).
The STI interventions footprint include: • The construction of the SKA project in Northern Cape; • The school -based science engagement initiative in all provinces; 17 267 • The National Recordal System (NRS) initiatives in the Free State, KwaZulu-Natal, Gauteng, Limpopo, Mpumalanga, the Northern Cape and Western Cape; • The Hydrogen South Africa (HySA) project in North West, Western Cape and Gauteng; • IP Wise awareness sessions in all provinces; • A bio-refinery in Kwazulu-Natal; • The Precision Agriculture Information System (PAIS) project in Limpopo, and in negotiations with the Eastern Cape; • The Agricultural Bio-innovation Partnership Programme (ABIPP) projects in all provinces; • An Indigenous Knowledge-Based Bio-Innovation Programme project in all provinces except the Northern Cape; and • A Strategic Health Initiative partnership project sin all provinces.
The Department has embarked on mapping all initiatives as part of the DDM journey, and this work is in progress.

It has four DDM Impact areas, life changing opportunities; economic competitiveness and recovery; access to basic services and infrastructure; and societal problems, challenges and decision support.

4.

Committees Deliberations 4.1.


The Committee, having considered and deliberated on the Revised Strategic Plans 2020 – 2025 and Annual Performance Plans 2021/22 of the Department of Science and Innovation made the following key observations and findings: • Members welcomed the information provided and acknowledged the important work that the Department continued to do.
• Considering the approaching COVID-19 third wave, would one be seeing a complete vaccine roll out and perhaps see most of population vaccinated by winter through SA's own vaccine development and research.

Members raised a concern regarding the serious budget cuts for research, especially for intellectual property (IP) management.

• Members commended the research efforts put in by the CSIR and the Human Sciences Research Council (HSRC) during the COVID-19 pandemic.
They noted that the pandemic had raised the profile of research and knowledge management within the Department.

• The Committee also expressed a concern with the fact that the Department had been historically underfunded.

Members saw the Department’s research work as very important, however, due to underfunding, the Department failed to effectively implement the mandate of taking that research 18 268 and developing it further.
An example given was that, SA had found the new corona virus variant, but could not take this research further, and thus could not positively contribute towards creating a suitable vaccine in the country.

Even though it had been indicated that it was work in progress, Members emphasised that SA needed to take important research further and develop its own capacity to manufacture COVID-19 vaccines.
• Members wanted to know the Department’s plan to assist the 392 high-end level skills research students and what kind of research would these students do.

The Department had earmarked 57 PhD level students and a question raised was whether there were any higher learning institutions which had been earmarked, and if so, which ones.
Also, how would the programmes be rolled out for students to be informed about these opportunities and whether technical and vocational education and training (TVET) colleges would benefit from this research.

• The Committee appreciated the fact that people in the provinces would be presented with job opportunities through the various projects in those provinces.
• Members wanted to know how far from completion was the SKA project and which higher learning institutions was the project in collaboration with.

• Members requested progress on the draft Decadal Plan.

• Members enquired why there was a budget increase for the allocation of venues and facilities in programme 3.

4.2.
4.2.

Responses by the Department The Department gave the following responses: • The Minister indicated that the President had asked him to develop the capacity to develop vaccines, not only for COVID-19, but for other diseases and potential pandemics, as the Department had distinguished scientists and the scientific infrastructure to enable this.
There was therefore an inter-ministerial committee on vaccines, led by Deputy President David Mabuza, and one of the work streams was precisely the local development of vaccines.

There were several dimensions to the development of local vaccines, which would be explained in detail in the presentation.

The Department had started the process of identifying the capacity they had for local manufacturing in SA.

There was an entity called Biovac, which was a company 47.5% owned by the government.
Biovac had the capacity to complete the last stage in vaccine production called “filling and finishing.” The Department aimed to develop a higher capacity for vaccine production which they were exploring using Biovac and going beyond, like entering partnerships with 19 269 America, France, Germany, Cuba, and the BRICS (Brazil, Russia, India, China, and SA) countries.

These partnerships would, however, require additional resources and investment into research and development.
The budget cuts had had a negative impact, but the Department’s strategy was now to use partnerships to access resources.

SA had a large capacity and was already producing South African-developed vaccines, and acted as the storage facility and distribution of COVID-19 vaccines.

The Minister would call on the various scientists who were involved in the vaccine production, to begin talks to take off on this very important work.
• The research grants were a co-business of the National Research Foundation (NRF).

The Department supported a lot of students at the post-graduate level, with approximately 2 000 students at the PhD level and a substantial number of students at the honours and master’s level.

The scholarships were offered and advertised as free-standing scholarships for which students should make applications.
There were also a variety of instruments available for research students, such as Centres of Excellence and Research Chairs which had students attached to their programmes.

• The Department had started engaging in discussions with the DHET on how to align the value chain from the TVET colleges into the PhD programmes.

Very advanced work had gone into this, being led by the Deputy Director-General, Mr Imraan Patel.
The Department was working on integrating TVET colleges into the value chain for the whole system to benefit from their areas of specialization.

• The Department was happy to report that the first part of the SKA project, the MeerKAT, which was a South African project with antennas, had just been completed.

The MeerKAT work was being taken as a foundation to begin with the first phase of the SKA project.
The administration arrangement and structure was in place, and the first phase would begin to be implemented with the participation of all the partners.

With the antennas already in place, new partners had come and were contributing to expanding the already existing numbers by 20, providing a broad base on which the SKA global project would be built.

• The Department was extremely cautious when it came to the investment of public resources in budget items such as venues and facilities.
It had been reflected as an increase for the 2021/22 financial year because most of the funds were cut from the previous financial year's budget due to the COVID-19 pandemic.

Then, towards the end of the year, the Department had been able to organize events which were crucial, such as the Science Forum to promote international partnerships and foreign investment etc.
The Department had thus budgeted to organize such 20 270 events, which mostly required face to face interactions with international partners.

It therefore reflected as an increase because in the previous financial year, that budget allocation had been cut, it was not an overall increase compared to the previous financial year's spending patterns.

• The NRF would support free-standing bursaries in any areas that students might be interested in.
However, some of the identified areas of priority were key areas that the Department felt the country needed to develop in, and each of these programmes also allocated a third of their funding to the institutions doing research in these areas to support students.

The Department ensured that all the different universities develop the students’ capabilities in these high-end skills.
• There were several universities, like Sol Plaatje University, Witwatersrand University (Wits) and the University of Cape Town (UCT) doing research as part of astronomy-related work in the SKA project.

The process to build the global SKA was delayed by the pandemic, and the next phase of building the 133 dishes would start early next year.

• The document for the Decadal Plan had been signed off in the Cabinet meeting the Minister had referred to, and had involved consultations with the Department.
The consultations were happening now with each DDG from the relevant departments, and should conclude by the end of July/early August, with Cabinet then endorsing this as a government-supported plan by ministries led by the DHET and DSI.

The Department would then start the process of amending the strategic plan between August and October for the elements of the Decadal Plan to be reflected in the next financial year’s APP.
• Through the Decadal Plan, the Department hoped to get more support for co-financing from other departments, like the Department of Trade and the Department of Mineral Resources, for some initiatives that would make it possible for activities to be transferred into the marketplace.

• The Department suggested that the Committee invite them back to share the processes concluded in September, if the consultation was completed in July/ August.
The Department agreed that co- financing of activities and more funding was crucial.

The Department had been working with Treasury to amend the Public Finance Management Act (PFMA) and the Procurement Act to accommodate the procurement by government on locally-developed innovations.

All of this would become clearer when these consultations and agreements had been concluded around July/August.

5.
5.

Recommendation Having satisfied itself in its engagement with the Department of Science and Innovation on their Annual Performance Plan and the Budget, the Select Committee on Education and Technology, Sport, Arts and 21 271 Culture recommends that Budget Vote 35: Department of Science and Innovation be adopted and that the House approves Budget Vote 35: Science and Innovation.

Report to be considered.

22 272