Administration 420.9 407.2 2.0 11.7 444.5 449.
International Trade and Economic Development 173.5 83.0 90.1 0.5 183.3 182.
Empowerment and Enterprise Development 1 307.9 82.1 1 225.3 0.4 979.7 1 050.
Industrial Development 414.6 77.5 325.5 11.6 634.1 597.
Consumer and Corporate Regulation 238.6 62.4 175.2 0.9 265.0 287.
The Enterprise Organisation 3 440.0 80.3 3 358.9 0.8 2 868.8 3 034.
Trade and Investment South Africa 283.1 128.3 152.9 1.9 302.7 323.
Communications and Marketing 65.7 59.0 - 6.7 74.8 79.
Total expenditure estimates 6 344.2 979.8 5 329.9 34.5 5 753.0 6 003.
Website address www.thedti.gov.
The aim of the Department of Trade and Industry is to lead and facilitate access to sustainable economic activity and employment for all South Africans through its understanding of the economy, its knowledge of economic opportunities and potential, and its anticipation of future economic trends. The department also aims to catalyse economic transformation and development, and to provide a predictable, competitive, equitable and socially responsible environment for investment, enterprise and trade for economic citizens. In this way, the department will contribute to achieving government's vision of an adaptive and restructured economy, characterised by accelerated economic growth, employment creation and greater equity by 2014.
Purpose: Provide strategic leadership for the department and its agencies, to ensure the successful implementation of the department's mandate through sustainable and integrated resource solutions and services that are customer centric.
Purpose: Build an equitable global trading system that facilitates development, by strengthening trade and investment links with key economies and by fostering African development including through regional and continental integration and development cooperation in line with the New Partnership for Africa's Development (NEPAD).
Purpose: Lead the development of policies and strategies that create an enabling environment for small, micro and medium enterprises, and enhance the competitiveness of local and provincial economies, to achieve inclusive shared equity, growth and job creation.
Purpose: Facilitate industrial development supported by government procurement that creates an enabling environment for competitiveness, growth and job creation.
Purpose: Develop and implement coherent, predictable and transparent regulatory solutions that facilitate easy access to redress and efficient regulation for economic citizens.
Purpose: Stimulate and facilitate the development of enterprises through providing incentive measures that support investment, job creation and regional economic development, such as through industrial development zones.
Purpose: Increase export capacity and support direct investment flows through strategies for targeted markets and an effectively managed network of foreign trade offices.
Purpose: Facilitate greater awareness of the department's role and increase the uptake of its products and services.
The Department of Trade and Industry's medium term strategy is informed by three key objectives: increased investment levels; increased labour absorption and competitiveness; and broader participation in the economy.
coordinating the implementation of the Accelerated and Shared Growth Initiative for South Africa promoting direct investment and growth in the industrial and services economy, with particular focus on creating employment raising the level of exports and promoting equitable trade promoting broader participation, equity and redress in the economy contributing to the development and regional integration of Africa within the New Partnership for Africa's Development (NEPAD) framework.
To improve the performance of the real economy's investment and employment, the department is committed to implementing policy initiatives and strategies that will enable the economy to adapt and adjust to emerging challenges. The national industrial policy framework and the 2007/08 industrial policy action plan have resulted in a more rigorous and comprehensive industrial policy.
The national industrial policy framework sets out government's broad approach to industrialisation in the context of the Accelerated and Shared Growth Initiative for South Africa and key identified sectors. The industrial policy action plan facilitates the implementation of the national industrial policy framework, setting out actions for immediate implementation in the key sectors, and cross-cutting actions such as industrial financing and measures to improve government's capacity to implement industrial policy. The department's industrial policy is aimed at structurally transforming some key sectors and simultaneously building the necessary capacity for higher levels of growth and employment.
Substantial work has been done to align industrial financing with industrial policy objectives. Incentives will be developed to promote investment and industrial competitiveness in the key sectors prioritised in the Accelerated and Shared Growth Initiative for South Africa and the national industrial policy framework, as well as in the small and medium enterprise sector.
The codes of good practice for broad based black economic empowerment (BEE) were gazetted in February 2007 to provide an implementation framework for BEE policy and legislation. Institutional mechanisms for monitoring and evaluating BEE are being established.
A key focus of the economic cluster has been to strengthen financial and business development support for small enterprises by improving the services offered by the Small Enterprise Development Agency and other similar agencies. A delivery network integrating both financial and non-financial support for small enterprises now covers all provinces. The Isivande Women's Fund, established in 2008, aims specifically to provide financial and business development support services to enterprises owned by women. Cabinet has approved 10 products for preferential procurement from small enterprises, and implemented measures to ensure that payments to small medium and micro enterprises (SMMEs) are processed within 30 days.
The department will accelerate the implementation of the national cooperatives strategy over the next three years to provide additional and focused support for this sector. Initiatives will include incentives for capacity building and improving competitiveness at the national, provincial and local level for registered cooperatives operating in the emerging economy.
The department will continue to partner with the Department of Provincial and Local Government and other role players, including the private sector, to provide support for spatial economic planning, local economic development and regional industrial development.
South Africa's trade policy is being reviewed to align it more closely with the priorities set by the Accelerated and Shared Growth Initiative for South Africa and the national industrial policy framework. A key focus is on increasing the level of exports, which is critical to domestic economic growth and development, and the department will provide leadership on trade policy to support fair trade. The main objective is to increase South African exports, specifically to higher value added exports, by implementing the export strategy. The export strategy includes interventions such as providing financial assistance to exporters through export marketing and investment advice, matchmaking strategies that link local exporters with retail and trade opportunities, and market intelligence services.
The department plays a prominent and active role in the World Trade Organisation, particularly by supporting the consolidation of the G20 group of developing countries, to ensure that the interests of developing countries are represented in the industrial tariff negotiations.
Progress has been made on trade integration in the Southern African Development Community (SADC). South Africa's view is that the SADC free trade area should be consolidated by improving the rules of origin, enhancing trade facilitation, and addressing non-tariff barriers. The key policy issue arising in both the Southern Africa Customs Union and SADC is that the region's underdeveloped production structures limit the potential benefits of a more open regional trading environment.
Corporate, consumer and credit laws have been reformed, and competition policies and laws have been reviewed. The new Companies Act (2008) will encourage improved corporate governance and transparency, while the Consumer Protection Amendment Bill, enacted in 2008, aims to create and promote an economic environment that actively supports consumers.
The Competition Amendment Bill was also enacted in 2008, and will promote both economic growth and the competitiveness of local industry by strengthening law enforcement capacity to investigate cartels and deal with complex monopolies in a highly concentrated market. The act will be implemented with an initial focus on the four industrial policy action plan lead sectors: capital, transport equipment and metals; automotives and components; chemicals, plastic fabrication and pharmaceuticals; and forestry, pulp and paper, and furniture.
Strategic partnerships are crucial to the department's success in delivering on these strategies, and coordination with other government departments through the economic cluster, other tiers of government, and the National Economic Development and Labour Council, will continue.
Value of support programme for industrial innovation projects Empowerment and Enterprise Development R137m R250.
Key performance indicators for Coega industrial development zone: - Number of new foreign investors each year - Value of new investments each year - Number of new jobs created each year The Enterprise Organisation - - - 9 R20.4bn 10 700 4 R5.9bn 4 867 9 R22.07bn 4 906 10 R5bn 2 000 15 R7.
Key performance indicators for Richards Bay industrial development zone: - Number of new foreign investors each year - Value of new investments each year - Number of new jobs created each year The Enterprise Organisation - - - - - - 1 R650m 1 200 - - 140 4 R1.9bn 375 5 R2bn 400 4 R2.
Value of investment generated through enterprise investment programme each year The Enterprise Organisation - - - - R68bn R139.6bn R149.
Key performance indicators for the critical infrastructure programme: - Number of new projects each year - Value of new investments each year - Number of new jobs created each year The Enterprise Organisation 10 R11.1bn - 6 R17.5bn 18 405 7 R9.
R million 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 1. Administration 257.6 278.9 310.8 395.2 395.2 420.9 444.5 449.9 2. International Trade and Economic 106.9 123.9 133.5 151.3 151.3 173.5 183.3 182.
Empowerment and Enterprise 1 004.1 1 320.0 1 472.1 1 177.5 1 177.5 1 307.9 979.7 1 050.
Industrial Development 210.6 253.2 331.8 443.6 443.6 414.6 634.1 597.4 5. Consumer and Corporate Regulation 93.6 131.2 137.9 173.2 173.2 238.6 265.0 287.8 6. The Enterprise Organisation 1 026.7 1 434.3 2 563.1 2 416.6 2 366.6 3 440.0 2 868.8 3 034.0 7. Trade and Investment South Africa 284.3 197.4 284.5 297.8 297.8 283.1 302.7 323.1 8. Communications and Marketing 72.7 65.8 61.5 71.7 71.7 65.7 74.8 79.
Administrative fees 2.1 2.5 4.1 - - 5.4 3.3 3.
Advertising 7.8 11.5 12.8 24.6 24.6 22.1 19.0 20.
Assets less than R5 000 0.4 0.3 0.2 - - 1.9 1.8 2.
Audit costs: External 4.3 4.0 3.9 - - 5.9 6.4 6.
Bursaries (employees) 0.5 0.5 0.4 - - 2.2 1.8 2.
Catering: Departmental activities 0.7 1.1 2.2 - - 2.8 4.3 2.
Consultants and professional services: - 1.0 0.0 6.4 6.4 - 0.0 0.
Consultants and professional services: 3.3 4.3 5.0 - - 0.2 0.2 1.
Contractors 0.8 10.5 12.2 - - 20.3 21.1 22.
Agency and support / outsourced services 5.0 0.4 8.6 - - 3.1 3.3 3.
Entertainment 0.6 1.3 1.7 - - 1.2 1.3 1.
Training and development 0.9 0.6 1.6 - - 8.8 7.6 9.
Provinces and municipalities 0.6 58.4 0.
Departmental agencies and accounts 947.9 1 406.0 1 503.0 1 259.1 1 259.1 1 407.3 1 103.3 1 191.
Universities and technikons - 6.0 - 10.5 10.
Public corporations and private enterprises 1 498.3 1 612.6 2 984.2 2 815.2 2 765.2 3 881.0 3 527.3 3 636.
Software and other intangible assets - 7.5 3.6 6.2 6.2 0.7 0.7 0.
Expenditure increased from R3.1 billion in 2005/06 to R5.
18.8 per cent. Expenditure is expected to rise to R6.3 billion in 2009/10, then decline to R5.8 billion in 2010/11, before increasing again to R6 billion in 2011/12. The increase in expenditure in 2009/10 is mainly due to additional funding allocated as transfers and subsidies to various regulatory institutions for capacity building, the business process outsourcing programme, the automotive production and development programme, the Coega industrial development zone, and the critical infrastructure programme for capital infrastructure.
Expenditure in the Empowerment and Enterprise Development programme increased from R1 billion in 2005/06 to R1.5 billion in 2007/08, and declines to R1.2 billion in 2008/09. The peak in 2007/08 was due to increased transfers and subsidies to the Small Enterprise Development Agency, the support programme for industrial innovation, the South African Micro Finance Apex Fund, the National Empowerment Fund, and Khula Enterprise Finance. With the exception of the Small Enterprise Development Agency, these entities are intended to be self funding over the medium term, so the allocation declines from R1.3 billion in 2009/10 to R1 billion in 2011/12.
The Enterprise Organisation is the largest programme in terms of budget. Expenditure increases from R1 billion in 2005/06 to R3 billion in 2011/12, an average annual increase of 20.1 per cent. This is due to higher spending on incentive schemes aimed at small and medium business enterprises, infrastructure development in the various industrial development zones (Coega, East London and Richards Bay). In particular, increased allocations for to address backlogs in settling claims from the small medium enterprise development programme and for the enterprise investment programme result in a peak in transfers and subsidies of R5.3 billion in 2009/10.
Savings of R1107.8 million, R132 million and R157.7 million have been identified over the medium term. The bulk of the amount is from Administration and The Enterprise Organisation programmes and have been effected in goods and services and transfer payments to departmental agencies and public entities.
The department reprioritised its budget over the MTEF period in line with the latest policy requirements and strategic objectives. Funding has also been redirected towards small enterprise development support.
Infrastructure spending relates primarily to the critical infrastructure programme and the industrial development zones. Private sector investments in infrastructure and contributions through the critical infrastructure programme have generated about R62 billion worth of investment in South Africa and contributed to the creation of more than 44 953 jobs (directly and indirectly) during infrastructure construction and operations. Government investment in infrastructure development in the industrial development zones has captured the interest of major investors, especially in Eastern Cape where the Coega and East London zones are located. These two zones are expected to raise over R22 billion in investments over the medium term. The positive spinoffs of infrastructure investment should boost Eastern Cape's economy and improve South Africa's competitiveness in manufacturing and exports, in line with the objectives of the Accelerated and Shared Growth Initiative for South Africa.
The Coega industrial development zone covers 11 500 hectares of industrial land located adjacent to the new deepwater port of Ngqura. The Coega Development Corporation is responsible for developing the entire landside infrastructure, with the National Ports Authority overseeing the development of the modern deepwater port facility. More than 50 infrastructure projects have been completed, and over R2.7 billion has been invested by both Eastern Cape province (R1.3 billion) and the Department of Trade and Industry (R1.4 billion). These investments are for facilities and infrastructure development, such as roads, bulk electricity power lines, water and sewers, new factory buildings, a residential village, a multi-tenant office building, and bulk earthworks. Through this initiative, the Coega Development Corporation created more than 16 000 jobs (direct and indirect).
Since its inception, the East London industrial development zone has managed to facilitate investment commitments from 17 manufacturers. The total infrastructure investment value is R920 million and 1 313 direct manufacturing jobs have been created. Since 2004/05, government has transferred approximately 90 per cent (R990 million) of the total funding allocation of R1.1 billion for infrastructure and facilities development.
The Richards Bay industrial development zone was designated in 2002, and operates on a provisional operator permit. Compared with the other industrial development zones, the Richards Bay zone requires minimal infrastructure as bulk infrastructure already exists. Two key investors have been secured. The estimated combined investment value is R2.3 billion.
Since its inception in 2002, the critical infrastructure programme has committed R1.9 billion in funding and paid R687 million, and has R1.2 billion in outstanding claims. Capital grants have been paid for 36 approved infrastructure projects across the provinces. Three projects are in Northern Cape, three in Gauteng, four in North West, nine in KwaZulu-Natal, three in Mpumalanga, nine in Eastern Cape (seven of which are in the Coega and East London industrial development zones), one in Free State, one in Western Cape, and three in Limpopo. These infrastructure projects are predominantly in the mining sector, comprising 41.4 per cent of the value of critical infrastructure programme grant funding, but grants have also been made for tourism infrastructure and the chemical and manufacturing sectors.
Over 44 953 jobs have been created during the construction phase of these projects. Projections show that approximately 19 000 permanent jobs will be created between 2008 and 2012 as part of the operational phase of the critical infrastructure supported investments. 6 490 permanent jobs have been created in the operational phase.
The approved projects have committed to spend over R3.8 billion on associated industries, such as smelting facilities, to produce value added products, thus creating positive spin-offs for the economy. The budget allocation for 2008/09 is R107 million, and is expected to increase to R120.8 million in 2009/10, R125.6 million in 2010/11 and R133.1 million in 2011/12.
Revenue is mainly generated from fines and penalties imposed by the Competition Tribunal for contraventions of competitive practices, as well as dividends paid out once a year by the Industrial Development Corporation for the department's 100 per cent shareholding.
The Office of the Director-General subprogramme provides for a transfer payment to the Industrial Development Corporation's fund for research into industrial development, growth and equity. The fund is responsible for research on economic and industrial policy developments and tendencies and their possible impact on growth and equity. The amounts payable are determined according to the cost estimates and anticipated deliverables of each approved research project.
Minister1 0.8 0.8 0.9 1.6 1.7 1.8 1.
Deputy Minister1 0.6 0.7 0.7 1.3 1.4 1.5 1.
Ministry 19.6 21.9 21.2 23.8 22.6 24.4 25.
Office of the Director-General 28.3 28.1 33.0 43.5 68.0 69.9 77.
Corporate Services 201.3 221.1 248.2 317.2 318.7 337.6 333.
Government Motor Transport 1.
Current payments Compensation of employees Goods and services of which: Administrative fees Advertising Assets less than R5 000 Audit costs: External Bursaries (employees) Catering: Departmental activities Communication Computer services Consultants and professional services: Business and advisory services Consultants and professional services: Infrastructure and planning Consultants and professional services: Legal costs Contractors Agency and support / outsourced servicesInventory: Stationery and printing Lease payments Owned and leasehold property expenditure Travel and subsistence Training and development Operating expenditure Venues and facilities Financial transactions in assets and liabilities Transfers and subsidies Provinces and municipalities 248.9 258.0 285.8 368.6 407.2 430.0 434.6 56.9 192.0 0.9 0.7 0.2 4.2 0.4 0.2 10.4 10.3 33.1 - 0.2 0.6 3.6 3.7 8.0 0.1 14.7 0.8 2.6 97.1 - 62.0 196.0 0.7 1.6 0.1 4.0 0.5 0.3 8.4 3.7 25.5 - 2.6 5.0 - 3.0 8.8 1.0 14.5 0.6 2.8 112.6 0.0 69.4 216.4 1.4 0.7 0.1 3.7 0.1 0.4 11.2 8.4 5.7 - 4.1 6.5 8.3 3.2 - 6.8 16.3 1.5 3.4 134.5 - 100.1 268.5 - 1.3 - - -- 9.88.3 35.5 6.2 - - - 4.1 151.9 6.5 19.3 - -25.6 - 120.0 287.2 2.5 1.1 0.6 5.8 2.2 0.9 7.7 8.3 35.2 - - 8.1 3.1 4.0 156.8 6.8 20.5 8.8 11.2 3.4 - 127.1 302.9 2.61.2 0.6 6.2 1.8 1.0 8.2 8.8 37.4 - - 8.6 3.34.2 166.6 7.2 21.7 7.6 11.9 3.6 - 133.4 301.2 2.8 1.2 0.6 6.5 2.0 1.0 8.6 9.3 39.3 - - 9.1 3.5 4.4 156.0 7.6 22.9 9.0 13.5 3.
Public corporations and private enterprises 5.0 5.0 5.3 0.6 0.6 0.6 0.
Households Payments for capital assets Buildings and other fixed structures Machinery and equipment Software and other intangible assets 0.1 0.2 0.9 1.5 1.4 1.5 1.6 3.3 15.8 18.9 24.6 11.7 12.4 13.
Medium-term expenditure estimate R million 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 Details of selected transfers and subsidies Public corporations and private enterprises Public corporations Other transfers Current 5.0 5.0 5.3 0.6 0.6 0.6 0.
Industrial Development Corporation: Fund 5.0 5.0 5.3 0.6 0.6 0.6 0.
Expenditure increased steadily between 2005/06 and 2008/09, rising from R257.6 million to R395.2 million at an average annual rate of 15.3 per cent. Over the medium term, expenditure is set to increase to R449.9 million in 2011/12, an average annual rate of 4.4 per cent. The largest allocation goes to the Corporate Services subprogramme, which increases from R201.3 million in 2005/06 to R333.5 million in 2011/12, an average annual increase of 8.8 per cent over the seven-year period, accounting for an average of 77.3 per cent of expenditure in the Administration programme.
Growth relates to operational costs associated with the public private partnership accommodation project, through which head office accommodation and facilities management services are being provided to the department and its public entities. This results in a new allocation for lease payments under current payments from 2008/09. Expenditure growth is due to accommodation costs for public entities located at the department's premise. These costs were previously recovered by the department from the entities.
18.3 per cent between 2005/06 and 2011/12, rising from R28.3 million to R77.4 million. This is due to the expansion of the strategic planning unit and the increase in the office's general capacity. The larger budget is also a result of anticipated increased expenditure on industrial policy research.
International Trade Development facilitates bilateral and multilateral trade relations and agreements.
International Trade Administration Commission to create an enabling environment for fair trade for South Africa through custom tariff investigations, trade remedies and import and export control. The amounts payable are based on the approved business plan of the entity and supporting memorandums of understanding.
Organisation for the Prohibition of Chemical Weapon as the South African contribution to the convention against the use of chemical weapons. The amounts payable are based on the annual fees determined by this organisation.
ProTechnik Laboratories as the South African contribution to international non-proliferation treaties and regimes. The amounts payable are based on the annual fees determined by this organisation.
World Trade Organisation as the South African membership fee to this global organisation dealing with rules of trade between countries. The amounts payable are based on the annual fees determined by this organisation.
African Economic Development facilitates bilateral and multilateral African trade relations aimed at deepening regional integration. Provision is made under this subprogramme for a transfer payment to the Development Bank of Southern Africa for regional spatial development initiatives aimed at accelerating sustainable socioeconomic development in the region. Funding is disbursed on the basis of approved business and project plans.
International Trade Administration oversees South Africa's system for international trade administration and its compliance with international non-proliferation treaties. Funding is disbursed on the basis of annual business plans approved for the International Trade Administration Commission, and is used mainly for salaries and membership fees for international organisations.
Expand market access for South Africa's exports and strengthen trade and investment links by continuing to participate in government-to-government platforms, and concluding three memorandums of understanding per year over the MTEF period.
investments and increased intra-Africa trade through bilateral and multilateral meetings with trade partners the consolidation of the Southern Africa Customs Union by providing technical assistance to the secretariat and leading negotiations on free trade terms, the SADC and the African Union (AU) by providing technical assistance to the AU secretariat institutional capacity building within the NEPAD framework by providing representatives to the secretariat.
Promote South Africa's interests in the multilateral trade system through ongoing engagement in the negotiating process and associated projects (such as research on international trade) based on ongoing national consultations with relevant government departments and stakeholders.
Encourage economic growth and development by managing South Africa's tariff regime in collaboration with the International Trade Administration Commission, which entails managing customs tariffs, import and export control permits, and duty credit certificates.
Ensure compliance with international non-proliferation treaties by monitoring production and trade in relevant industries.
At the multilateral level, South Africa continues to play a leading role. The department participated in the Doha Round negotiations coordinated by the World Trade Organisation, and the twelfth ministerial meeting of the United Nations (UN) Conference on Trade and Development. The department engaged in regional trade consultations, such as the India-Africa Summit, the Forum on China-Africa Cooperation, and the India-Brazil-South Africa Dialogue Forum. India and Brazil have been identified as important new growth markets. The department signed 12 bilateral and regional trade investment agreements and undertook 15 technical and business missions to negotiate the terms of bilateral and multilateral trade agreements.
The department continues to participate in institutional processes aimed at deepening regional integration in SADC and the Southern Africa Customs Union. SADC launched a free trade agreement in August 2008 that will reduce the barriers to trade between countries in the region. The department is a central player in building new regional institutions as provided for in the Southern Africa Customs Union agreement, and continues to review the union's functions and effectiveness. In June 2008, the Southern Africa Customs Union signed a trade investment and development cooperation agreement with the United States of America and subsequently undertook a review of the Africa Growth and Opportunity Act (2004), as part of a broader market access strategy to expand exports to the US. Following the conclusion of the Southern Africa Customs Union-Mercusor preferential trade agreement in May 2008, the Southern Africa Customs Union-India preferential trade agreement negotiations were launched in September 2007. Three rounds of negotiations have been completed.
The department provides technical support to the NEPAD secretariat in implementing spatial development initiatives across Africa, and continues to participate in AU efforts to rationalise integration processes and develop a continental model for business law. The department also provides institutional and technical support to key countries in Africa, including Nigeria, Ghana, Zimbabwe, Egypt, Mali, Senegal, Uganda, Ethiopia and Zambia, and technical economic support for South Africa's post-conflict reconstruction and development programmes in the Democratic Republic of Congo, Sudan, Angola and Rwanda. In 2007, the department published South Africa in Africa - A Business Guide to provide potential investors and traders with information about the South African market and business environment.
International Trade Development 29.4 42.3 43.0 112.4 130.1 135.5 137.
African Economic Development 31.1 32.3 34.8 39.0 43.4 47.8 44.
International Trade Administration 46.5 49.2 55.
Total 106.9 123.9 133.5 151.3 173.5 183.3 182.
Change to 2008 Budget estimate 2.6 17.4 18.3 (2.
Current payments Compensation of employees Goods and services of which: Administrative fees Advertising Catering: Departmental activities Communication Consultants and professional services: Business and advisory services Inventory: Stationery and printing Owned and leasehold property expenditure Travel and subsistence Operating expenditure Venues and facilities Transfers and subsidies Provinces and municipalities Departmental agencies and accounts Public corporations and private enterprises Foreign governments and international organisations Households Payments for capital assets Machinery and equipment Software and other intangible assets 36.1 45.3 51.0 68.1 83.0 87.5 80.7 22.0 14.1 0.0 0.3 0.1 0.7 0.2 0.5 10.5 - 0.4 1.3 28.3 17.0 0.1 0.30.1 0.7 0.7 0.5 - 13.3 0.2 1.0 32.1 18.9 0.2 0.2 0.2 0.9 0.4 0.4 - 14.7 0.4 1.5 41.4 26.6 - 0.5 - 0.9 1.70.4 - 17.6 - 5.4 53.4 29.6 - 1.2 1.0 1.3 2.0 0.5 - 11.5 0.9 10.9 56.0 31.5 - 1.8 2.5 1.4 2.20.5 - 11.8 0.1 10.9 56.1 24.6 - 1.9 0.7 1.5 2.3 0.5 - 12.3 0.2 4.9 70.5 78.1 81.9 83.0 90.1 95.3 101.0 0.1 50.6 18.4 1.3 0.1 0.0 53.4 13.8 10.8 0.0 - 57.6 14.5 9.7 0.0 - 60.5 15.2 7.3 0.0 - 63.0 15.9 11.2 - - 66.6 16.8 11.9 - - 70.6 17.8 12.
Current 47.8 50.8 57.2 60.2 63.0 66.6 70.
International Trade Administration Commission 46.5 49.2 55.7 58.4 60.9 64.3 68.
ProTechnik Laboratories 1.4 1.5 1.5 1.8 2.1 2.3 2.
Capital 2.8 2.7 0.4 0.
ProTechnik Laboratories 2.8 2.7 0.4 0.
Current 18.4 13.8 14.5 15.2 15.9 16.8 17.
Development Bank of Southern Africa: Regional spatial 18.4 13.8 14.5 15.2 15.9 16.8 17.
Current 1.3 10.8 9.7 7.3 11.2 11.9 12.
Organisation for the Prohibition of Chemical Weapons 1.3 1.6 2.2 2.3 6.0 6.4 6.
World Trade Organisation - 9.2 7.5 5.0 5.2 5.5 5.
Expenditure increased consistently between 2005/06 and 2008/09, rising from R106.9 million to R151.3 million at an average annual rate of 12.3 per cent. Expenditure is expected to rise to R182.4 million in 2011/12 at an average annual rate of 6.4 per cent over the medium term.
Expenditure in the International Trade Development subprogramme increased significantly between 2007/08 and 2008/09, rising from R43 million to R112.4 million. This was due to the consolidation of the two subprogrammes dealing with international trade in 2008/09, and does not reflect an increase in activities or expenditure.
Expenditure in transfer payments over the medium term increases from R83 million in 2008/09 to R101 million in 2011/12 at an average annual rate of 6.8 per cent. This is partly due to the increase in the transfer to the Development Bank of Southern Africa to fund regional spatial development initiatives, which aim to create conditions and opportunities for successful new fixed investment within specific areas of the region. The department is also strengthening its human resources capacity to deliver on its mandate and expanded work programme. Transfers to international organisations make up an increasingly important component of this expenditure, rising from R7.3 million in 2008/09 to R12.6 million in 2011/12.
Enterprise Development creates an enabling environment conducive to the development and growth of SMMEs and cooperatives enterprises, and provides innovation and technology support to these entities. All efforts are aimed at increasing the contribution of SMMEs and cooperatives to South Africa's GDP, and improving the lives of all South Africans.
Khula Enterprise Finance provides wholesale finance to promote and facilitate access to finance for small and medium enterprises. The amounts payable are based on the approved business plan of the entity, and supporting memorandums of understanding.
South African Micro Finance Apex Fund provides sustainable access to affordable financial services for the poor. The amounts payable are based on the approved business plan of the entity, and supporting memorandums of understanding.
Small Enterprise Development Agency provides non-financial business development and support services for small enterprises. The amounts payable are based on the approved business plan of the entity, and supporting memorandums of understanding.
United Nations Industrial Development Organisation channels the South African contribution towards achieving sustainable global industrial development. The amounts payable are based on the fees determined by member states, including South Africa.
Small Enterprise Development Agency's technology programme is managed by the agency, and finances and supports early, seed and start-up technology ventures aimed at increasing the competitiveness of South Africa. The amounts payable are based on qualifying projects.
National Research Foundation's technology and human resources for industry programme supports research and technology development by strengthening the numbers and skills of appropriately trained people. The amounts payable are based on the approved business plans and qualifying projects.
Productivity Institute of South Africa's workplace challenge programme finances and supports world class manufacturing and value chain efficiency improvements in South African companies. The amounts payable are based on qualifying projects.
Industrial Development Corporation's support programme for industrial innovation enables private sector enterprises to develop new products and services. The amounts payable are based on matching grants to contributions by such enterprises.
Equity and Empowerment implements BEE and gender policies.
National Empowerment Fund facilitates funding for BEE transactions by providing innovative investment solutions to black people. The amounts payable are based on the approved business plans of the entity, and supporting memorandums of understanding.
South African Women Entrepreneurs' Network, housed at Khula Enterprise Finance, supports and grows women entrepreneurship through networking facilities. The amounts payable are based on the approved business plans.
Industrial Development Corporation's Isivande Women's Fund provides financial support to women entrepreneurs to grow their businesses. The amounts payable are based on the approved projects.
Regional Economic Development enhances the competitiveness of local and provincial economies for sustained economic growth. Funding will mainly be for salaries and related personnel expenditure.
Foster the growth of SMMEs and cooperatives by creating an enabling environment and overseeing the support provided by agencies such as Khula, the Small Enterprise Development Agency and the South African Micro-finance Apex Fund to increase the number of SMMEs (currently 2 million) and cooperatives, (17 000 registered, but many more informal, including an estimated 800 000 stokvels) and their contribution to GDP from 40 per cent to 45 per cent over the next 5 years.
Facilitate access to government procurement opportunities by SMMEs and cooperatives through overseeing the implementation of the 10 approved products over the MTEF period, thereby increasing the number of SMMEs and cooperatives from which government procures, subject to a minimum of 85 per cent of their procurement expenditure benefiting SMMEs and cooperatives through the 10 products.
Facilitate the increased participation of black people in business and business transactions through promoting empowerment and equity policies by facilitating and gazetting BEE charters under sections 9 and 12 of the Broad-Based Black Economic Empowerment Act (2003).
Expand support for hi-tech industries operating in the region by providing access to incentives and coordinating regional stakeholder participation by forming partnerships aimed at creating at least 4 000 jobs by 2012.
The Cooperatives Act (2005) came into effect in 2007/08. Regulations were approved for the full establishment and implementation of new registration systems for cooperatives at the Companies and Intellectual Property Registration Office, resulting in the legalisation of the registration of cooperatives in South Africa.
August 2008 marked the end of the transitional period during which the economy could convert from narrow based to broad based BEE and establish institutional systems for BEE. This also applied to the unconditional application of the codes of good practice. In 2008/09, a BEE verification manual was completed, a BEE IT portal was launched, and BEE sector charters for tourism, construction, forestry, and transport were gazetted. The department provided technical support for the drafting and negotiation of 7 BEE sector charters.
The Isivande Women's Fund was launched in 2008 to promote women's access to finance. Isivande will be capitalised with R100 million by both the department and Masisizane (Old Mutual). This fund will provide women with accessible and affordable loans of between R30 000 and R2 million for growing their enterprises.
The support programme for industrial innovation recorded total sales of R309 million, of which R150 million were export sales of new products. 1 220 shop floor jobs were created. The technology and human resources for industry programme leveraged R163 million from the private sector for new technology development, and supported 264 SMMEs in 2008/09. The Small Enterprise Development Agency technology programme created 126 new SMMEs and supported 34 technology transfers to SMMEs to the value of R12 million.
Enterprise Development 578.6 733.5 732.6 827.9 526.0 349.0 389.
Equity and Empowerment 425.5 586.5 739.5 349.6 475.1 278.0 294.
Regional Economic Development - - - - 306.8 352.7 365.
Total 1 004.1 1 320.0 1 472.1 1 177.5 1 307.9 979.7 1 050.
Change to 2008 Budget estimate (60.9)) 16.3 42.6 88.
Current payments Compensation of employees Goods and services of which: Administrative fees Advertising Communication Consultants and professional services: Business and advisory services Contractors Inventory: Stationery and printing Lease payments Travel and subsistence Operating expenditure Venues and facilities 15.9 26.1 31.0 35.6 82.1 82.1 94.5 7.7 8.2 0.0 0.2 0.2 3.0 - 0.5 0.1 2.5 0.5 0.9 11.0 15.1 0.1 0.2 0.3 4.70.9 0.4 0.1 5.0 1.0 2.3 13.2 17.80.0 0.4 0.2 6.4 0.3 0.3 0.05.7 0.6 3.4 20.9 14.7 - 0.5 0.6 4.2 - 0.6 - 4.0 - 4.9 36.8 45.3 1.0 2.7 0.5 13.3 0.4 1.4 0.1 10.8 7.8 7.3 38.1 44.1 - 2.5 0.6 20.8 - 2.5 0.2 8.0 5.9 3.5 39.8 54.7 - 2.6 0.6 14.0 - 2.6 0.3 9.7 12.7 12.
Transfers and subsidies 988.1 1 293.7 1 440.8 1 141.8 1 225.3 897.1 955.
Departmental agencies and accounts 789.3 1 222.3 1 289.9 1 006.4 1 083.8 747.8 796.
Public corporations and private enterprises 192.3 63.8 141.0 120.1 125.6 133.0 135.
Foreign governments and international organisations 2.4 2.9 4.9 9.2 13.3 13.6 19.
Departmental agencies and accounts Departmental agencies (non-business entities) Current Godisa Trust National Empowerment Fund National Productivity Institute: Workplace Challenge Small Enterprise Development Agency Small Enterprise Development Agency technology programme South African Micro Finance Apex Fund Capital National Empowerment Fund National Research Foundation: Technology and human resources for industry programme Public corporations and private enterprises Public corporations Subsidies on production or products Current South African Bureau of Standards: Trade metrology Public corporations and private enterprises Public corporations Other transfers Current Council for Scientific and Industrial Research: Technology for women in business Khula Enterprise Finance Industrial Development Corporation: Isivande Women's Fund Capital Industrial Development Corporation: Support programme for industrial innovation Public corporations and private enterprises Private enterprises Other transfers Capital Centurion Aerospace Village Foreign governments and international organisations Current United Nations Industrial Development Organisation Non-profit institutions Current South African Women Entrepreneurs' Network 275.6 578.1 524.5 531.5 608.4 574.3 617.9 40.6 40.0 7.4 187.6 - - - 66.0 7.9 311.4 62.7 130.0 - 100.0 8.3 258.8 73.4 84.0 - - 8.7 408.0 76.7 38.1 - 116.0 8.0 331.2 68.3 84.8 - 22.7 8.5 376.7 76.3 90.1 - 24.1 8.1 384.7 110.5 90.5 513.7 644.2 765.4 474.9 475.5 173.4 178.9 370.6 143.1 495.1 149.1 610.0 155.5 312.9 162.0 311.6 163.8 -173.4 - 178.9 9.5 18.3 10.6 11.
This programme, which previously formed part of the Enterprise and Industry Development programme, will become effective from April 2009. Between 2005/06 and 2008/09, expenditure increased rapidly at an average annual rate of 21.1 per cent, rising from R1 billion in 2005/06 to R1.5 billion in 2007/08. This was driven by transfers to departmental agencies, such as the National Empowerment Fund and the Small Enterprise Development Agency, for recapitalisation. In 2008/09, expenditure declined to R1.2 billion as these transfers were reduced, and is expected to decline again in 2010/11 to under R1 billion for the same reason. These decreases relate mainly to expenditure decreases in the Equity and Empowerment subprogramme over the medium term. This largely reflects the phasing out of capital allocations to the National Empowerment Fund, which decrease from R610 million in 2007/08 to R311.6 million in 2009/10, and then cease.
The National Empowerment Fund is a catalyst for BEE and is the development funding institution mandated by government to champion economic transformation in South Africa by providing innovative finance and investment solutions to black people. The fund's role is to support and invest in BEE as defined by the codes of good practice. This will include a focus on preferential procurement, broadening the reach of black equity ownership, transformation in management and staff, and preventing the dilution of black shareholding. The work of the National Empowerment Fund straddles and complements other development finance institutions, and the fund is able to enhance other development finance institutions and their mandates by sharing its specialist sector expertise and knowledge of BEE.
Value of funding of community development projects each year Rural and Community Development/Project Unit R1.5m - R57.
Total value of loan book Corporate Fund/Imbewu Fund/Rural and Community Development/Project Unit/Strategic Projects Fund - - R714m R1.2bn R1.8bn 2.4bn R2.
Total value of approved loans Corporate Fund/Imbewu Fund/Rural and Community Development/Project Unit/Strategic Projects Fund - - - R1.3bn R1.9bn R2.5bn R2.
In 2007, the National Empowerment Fund launched a retail product known as the National Empowerment Fund Asonge Share Scheme. The results have exceeded expectations, with over 86 000 investors buying more than 12 million shares worth in excess of a cumulative R1.5 billion at year end. The board of trustees has approved the allocation of a further 1.4 million shares, worth R147 million, to provide for the oversubscription and ensure a full allocation of shares to qualifying applicants.
By March 2008, the National Empowerment Fund had approved 124 transactions at an investment cost of R932 million, of which 117 transactions totalling R699 million were disbursed. 74 per cent is invested in deals below R5 million, and 26 per cent in deals above R5 million.
As a direct result of funding from the National Empowerment Fund, 4 693 jobs have been created, while more than 15 300 indirect jobs have been sustained. 31 per cent of the fund's investment portfolio comprises businesses owned and managed by black women entrepreneurs. By value, construction continues to take the lead as the highest funded sector at 23.5 per cent, followed by ICT and media at 12.9 per cent, as illustrated in the trustees' report.
Non-tax revenue 65.4 133.1 1 019.1 370.0 471.9 554.4 654.
Other non-tax revenue 65.4 133.1 1 019.1 370.0 471.9 554.4 654.
Transfers received 40.0 66.0 100.0 - 116.0 22.7 24.
Total revenue 105.4 199.2 1 119.1 370.0 587.9 577.1 678.
Interest, dividends and rent on land 0.
Investments 1 526.2 2 407.4 1 957.9 2 336.4 3 036.4 3 736.4 4 336.
Loans 153.0 338.
Receivables and prepayments 19.1 24.3 16.9 15.0 15.0 15.0 15.
Cash and cash equivalents 400.1 793.0 2 317.8 2 490.0 2 546.3 1 804.6 1 381.
Total assets 2 101.5 3 565.8 4 300.3 4 851.8 5 608.3 5 564.4 5 738.
Accumulated surplus/deficit 76.7 187.2 1 137.1 1 381.5 1 823.3 1 779.4 1 953.
Capital and reserves 2 010.6 3 363.8 3 133.3 3 445.3 3 759.9 3 759.9 3 759.
Borrowings 3.0 - 0.
Trade and other payables 11.2 14.7 24.3 25.0 25.0 25.0 25.
Provisions - - 4.
Total equity and liabilities 2 101.5 3 565.8 4 300.3 4 851.8 5 608.3 5 564.4 5 738.
The net asset value of the National Empowerment Fund has increased from R2.1 billion in 2005/06 to R4.3 billion in 2007/08. This has largely been due to appreciation in fair value of the asset management portfolio, as well as the capitalisation of the fund by the department. Expenditure also increased from R61.9 million in 2005/06 to R167.3 million in 2007/08, and is expected to rise to R343.2 million by 2011/12. The expenditure trend is monitored as a ratio of net asset value and is currently standing at 1.9 per cent of net asset value, well below that of other comparable development finance institutions and funds. The transfer payments received from the department for recapitalisation have allowed the National Empowerment Fund to increase its investments and loans for empowerment outcomes. These now exceed R1 billion.
The Small Enterprise Development Agency was established at the end of 2004 through the merger of the Ntsika Enterprise Promotion Agency, the National Manufacturing Advisory Centre, and the Community Public Private Partnership Programme. The Godisa Trust and the National Technology Transfer Centre were integrated into the agency in April 2006, to become the Small Enterprise Development Agency's technology programme.
Through its national network, the Small Enterprise Development Agency provides non-financial business development and support services for small enterprises in partnership with other role players. The agency also implements business development programmes in government priority areas and for government target groups.
Between 2005/06 and 2007/08, the Small Enterprise Development Agency's infrastructure grew from 6 provincial offices and 27 district branches to 8 provincial offices, 43 district branches and 2 mobile units, and the staff complement grew from 351 to 530. The agency also introduced a complementary service delivery model to increase its reach. This involved setting up offices or desks at 37 local government locations on specific days, and in other organisations such as ABSA (nationally), the South African Women Entrepreneurs Network (Eastern Cape) and the Department of Economic Development (KwaZulu-Natal).
As a result of the expansion, the number of enterprises serviced increased from 32 796 in 2005/06 to 186 195 in 2007/08. In 2007/08, the technology programme supported 642 clients, creating 6 289 jobs. In partnership with 85 schools and 1 tertiary institution, the University of the Western Cape, the entrepreneurship awareness programme has reached 5 800 students. In April 2008, the agency launched its trade point programme, which will expose South African small enterprises to international markets and opportunities. This is a partnership with local business associations and the World Trade Point Federation, a programme of the UN Conference on Trade and Development.
Revenue is dominated by transfers received from the Department of Trade of Industry, local government, and local and international donors. Transfers increase from R194.4 million in 2005/06 to R523.2 million in 2008/09, of which the department transferred R187.6 million in 2005/06 and R484.7 million in 2008/09 to the Small Enterprise Development Agency and its technology programme. Departmental transfers to the agency and the technology programme are expected to stabilise over the MTEF period, reaching R495.2 million by 2011/12.
Total expenditure increases from R522.6 million in 2008/09 to R591.3 million in 2011/12. Expenditure is mainly on goods and services, which increases from R117.8 million in 2005/06 to R306.4 million in 2011/12, and on compensation of employees, which increases substantially from R51.7 million in 2005/06 to R268.2 million in 2011/12.
Industrial Competitiveness does advocacy work and develops policies and interventions related to: the diversifying of technical infrastructural support; eliminating intermediate barriers to entry; deepening domestic technology linkages; and participating in dynamic value chains to improve the industrial competitiveness of the South African economy.
South African Bureau of Standards develops, promotes and maintains standardisation and quality in connection with commodities, and provides related conformity assessment services aimed at protecting the integrity of the South African market and creating a competitive advantage for industry. Funding is based on the approved business plan of the entity and supporting memorandums of understanding.
National Metrology Institute of South Africa provides for the use of the international systems of units and certain other measurement units, and designates, maintains and keeps national measurement units and standards. Funding is based on the approved business plan of the entity and supporting memorandums of understanding.
South African National Accreditation System provides an effective accreditation system for conformity assessment, calibration and compliance monitoring for good laboratory practice. Funding is based on the approved business plan of the entity and supporting memorandums of understanding.
National Regulator for Compulsory Specifications administers and maintains compulsory specifications and regulations that may affect public health, safety or the environment, and has the legal metrology responsibility. Funding is based on the approved business plan of the entity and supporting memorandums of understanding.
Council for Scientific and Industrial Research's aerospace industry programme creates an industry supplier base that is firmly integrated in global supply chains. One of its aims is to stimulate small business and BEE participation through various clustering initiatives. The amounts payable are based on identified industry needs, applications and qualifying projects.
Council for Scientific and Industrial Research's National Cleaner Production Centre undertakes specific cleaner production projects in the chemicals, agro-processing, clothing, textiles and automotive sectors. Funds are distributed to qualifying projects.
South African Bureau of Standards' plant infrastructure upgrades infrastructure and laboratories. Funding is based on the project plan.
South African Bureau of Standards' small business technical consulting programme participates as a member of international organisations dealing with technical infrastructure and regulatory activities. Funding is distributed according to the membership fees of the various organisations.
Customised Sector Programmes develops high impact sector specific strategies for economic growth and employment creation. Provision is made under this subprogramme for a transfer payment to the Industrial Development Corporation's customised sector programme to increase investment, competitiveness and exports in prioritised sectors. Funding is distributed to qualifying projects.
Grow and diversify manufacturing and tradable services by facilitating and monitoring the implementation of the industrial policy action plan over the next 3 years.
Foster an enabling environment for industrial upgrading and support for sustainable development by developing and implementing a technical infrastructure strategy (including standards, quality, assurance, accreditation and metrology) by 2009.
Respond to the impact of climate change by developing and implementing an industrial climate change response plan and launching cleaner production initiatives in at least 110 companies by 2012.
Support industrial development in South Africa and retain a total of 20 000 direct jobs by 2012 by leveraging government procurement through the national industrial participation programme.
Strengthen regional industrial development and cooperation by collaborating with regional economic communities to harmonise business laws and develop strategies on continental norms for agricultural, industrial and environmental standards.
The Department of Trade and Industry launched an automotive production and development programme as part of the process of implementing the national industrial policy framework and the industrial policy action plan. Measures were finalised to restructure the clothing and textiles sector, and investment and employment creation strategies were introduced in sectors such as business process outsourcing, tourism, crafts, and film and television production.
The department has provided support to accelerate reforestation in Eastern Cape and KwaZulu-Natal. A draft memorandum of understanding has been compiled to facilitate the import of timber from Mozambique by South African small businesses, and promote investment in forestry projects in Mozambique.
Since 2005, 102 firms have been audited by the National Cleaner Production Centre and about 25 per cent have implemented the recommendations of the audits.
The revised national industrial participation programme guidelines were released, providing a model for skills development and compulsory BEE requirements. The department provided technical and financial support for the development of an action plan for the accelerated industrial development of Africa, which was approved by the AU heads of state and government at the 2008 summit. The department similarly supported an implementation strategy for the action plan, which was approved by the eighteenth conference of African ministers of industry in October 2008.
The department has established craft hubs with rural satellites in Western Cape, Eastern Cape, KwaZulu-Natal and Gauteng. It is expected that some 20 000 new jobs will be created, contributing to South Africa's exports. The deputy president launched the pilot Mzansi collection store, an extension of the Gauteng hub, in Sandton Square in November 2008.
Industrial Competitiveness 185.8 228.9 300.8 352.3 288.9 504.5 449.
Customised Sector Programmes 24.8 24.3 31.1 91.3 125.7 129.6 148.
Total 210.6 253.2 331.8 443.6 414.6 634.1 597.
Change to 2008 Budget estimate 84.3 40.9 239.7 146.
Current payments Compensation of employees Goods and services of which: Administrative fees Advertising Communication Consultants and professional services: Business and advisory services Inventory: Stationery and printing Travel and subsistence Operating expenditure Venues and facilities Transfers and subsidies Provinces and municipalities Departmental agencies and accounts Universities and technikons Public corporations and private enterprises Households Payments for capital assets Machinery and equipment Total 54.0 31.9 22.2 0.4 0.3 0.4 10.4 0.9 7.1 0.8 1.4 156.2 0.1 44.4 - 111.5 0.3 0.4 0.4 210.6 59.3 37.8 21.5 0.3 0.6 0.5 4.0 0.8 10.7 0.6 3.6 193.6 0.0 47.0 6.0 140.5 0.1 0.3 0.3 253.2 80.5 47.6 33.0 0.7 0.9 0.6 12.3 0.7 11.6 0.9 4.8 250.8 - 59.3 - 191.2 0.3 0.6 0.6 331.8 141.3 58.0 83.4 - 0.2 0.7 36.71.4 18.3 - 25.7 301.4 - 75.5 10.5 211.8 3.6 0.8 0.8 443.6 77.5 43.8 33.8 1.3 2.3 0.8 9.4 1.2 10.8 0.9 6.8 325.5 - 87.8 - 237.7 - 11.6 11.6 414.6 88.3 45.8 42.5 - 3.2 0.6 11.92.5 12.0 - 12.2 533.0 - 94.1 - 438.9 - 12.7 12.7634.1 99.7 47.9 51.8 - 3.4 0.6 12.6 2.6 12.7 - 19.7 485.3 - 103.0 - 382.2 - 12.5 12.5 597.
Current 44.4 47.0 59.3 75.5 87.8 94.1 103.
South African national accreditation system 9.5 10.0 12.5 13.8 13.9 14.7 15.
National Metrology Institute of South Africa 34.8 36.9 46.8 55.0 52.3 55.3 58.
National Regulator for Compulsory Specifications - - - 6.8 21.5 24.1 28.
Current - 6.0 - 4.
Witwatersrand Business School: Centre for Entrepreneurship - 3.0 - 2.
University of Pretoria: Advanced Engineering Centre of Excellence Public corporations and private enterprises - 3.0 - 2.
Current - 2.0 - 3.
Council for Scientific and Industrial Research: Fibre and Textile Centre of Excellence Public corporations and private enterprises - 2.0 - 3.
Current 104.6 131.2 173.9 152.8 173.6 200.5 222.
Council for Scientific and Industrial Research: National Cleaner Production Centre Industrial Development Corporation: regional industrial development South African Bureau of Standards: Research contribution 1.4 - 102.7 4.1 - 126.4 4.5 30.0 138.6 9.8 - 142.1 19.0 - 153.7 32.1 - 167.4 40.1 - 181.
South African Bureau of Standards: Small business technical consulting Capital 0.5 3.8 0.6 5.7 0.7 15.8 0.9 16.0 0.9 15.4 1.0 189.9 1.1 108.
Council for Scientific and Industrial Research: Aerospace Industry Council for Scientific and Industrial Research: Technology venture capital South African Bureau of Standards: Plant infrastructure 3.8 - - 5.7 - - 10.0 5.8 - 10.0 6.0 - 9.9 5.5 - 9.9 5.8 174.2 20.8 6.1 81.
This programme, which previously formed part of the Enterprise and Industry Development programme, will become effective from April 2009. Past expenditure trends are based on expenditure in the relevant subprogrammes.
Expenditure between 2005/06 and 2008/09 increased significantly at an average annual rate of 28.2 per cent, rising from R210.6 million in 2005/06 to R443.6 million in 2008/09. Over the medium term, expenditure on the Customised Sector Programmes' subprogramme increases rapidly, from R91.3 million in 2008/09 to R148.3 million in 2011/12, at an average annual rate of 17.6 per cent. Much of this is accounted for by the introduction of the customised sector programmes in 2008/09, which will be administered by the Industrial Development Corporation.
Between 2005/06 and 2011/12, the Industrial Competitiveness subprogramme is expected to increase at an average annual rate of 15.8 per cent, rising from R185.8 million in 2005/06 to R449.1 million in 2011/12. The increase is mainly due to the additional funding allocated as a transfer to the South African Bureau of Standards for plant infrastructure and capacity building over the MTEF period.
The Standards Act (1993) was repealed and replaced with two acts, the National Regulator for Compulsory Specifications Act (2008) and the Standards Act (2008), which came into effect in September 2008. These legislative changes are set to transform the previous regulatory division of the South African Bureau of Standards into a separate and independent regulatory body, the National Regulator for Compulsory Specifications, and refine the mandate of the bureau.
The South African Bureau of Standards aims to be the trusted third party for adjudicating and certifying standards for products and services. In this way, the bureau contributes to the economic growth of South Africa and Africa as a whole, promotes the protection of the integrity of the South African market and consumers, creates a competitive advantage for South African industry, and promotes access by South Africans to local and international markets.
Over the medium term, the bureau will focus on developing market relevant national standards in line with international standards. It will continue to offer testing services and conformity assessments to local and international customers, including opening a regional office in China. Central to this focus is the creation and maintenance of awareness of the South African Bureau of Standards brand, and maintaining accreditation with local and international bodies.
The bureau intends to upgrade and modernise laboratories and construct new laboratories to improve and expand test services. Increased profitability will be achieved through aggressive sales and marketing, recruiting and retaining critical skills, using technology enabled processes, and improving operational effectiveness.
Sales of standards each year Development of South African national standards R10.6m R12.3m R13.9m R15.7m R19m R21m R23.
Investigation, tests and services revenue each year Tests and conformity assessments R176m R194.5m R174.6m R218m R234.3m R250.7m R270.
Product and service certification revenue each year Tests and conformity assessments R92.9m R105.6m R134.6m R160.9m R184.4m R202.8m R225.
Following the split in 2008/09 with the National Regulator for Compulsory Specification, the South African Bureau of Standards reviewed its operating model.
The development of national standards is set to meet the annual target of 550 for 2008/09. Following the decision of the International Organisation for Standardisation to allow the bureau to reduce prices to match their own, sales of standards have increased.
Despite being slightly behind target, the product and system certification business has recorded notable growth since 2005/06. The number of certification schemes has increased to 18, providing avenues for further growth in the future. Test volumes have not reached the desired levels and are impacting on revenue growth.
Marketing efforts have been intensified to improve awareness of the South African Bureau of Standards and its services and alert consumers to issues of quality. To this end, in October 2008 the bureau organised its first expo.
The Design Institute promotes innovation and excellence in product design, organising events to promote the conversion of ideas into products.
Non-tax revenue 381.8 363.2 352.7 433.7 452.1 489.8 540.
Sale of goods and services other than capital 360.6 304.1 318.4 415.3 437.8 474.5 519.
Admin fees 81.
Total assets 415.4 514.1 570.5 621.2 885.5 1 049.7 1 100.
Total equity and liabilities 415.4 514.1 570.5 621.2 885.5 1 049.7 1 100.
While total revenue is expected to increase from R575.9 million in 2008/09 to R722 million in 2011/12, growth is projected to slow due to the global recession. The projected increase is driven by growth of 7 per cent in the areas of investigation, tests and services, and 10 per cent in both the product and system certification business, as well as by the sale of publications.
Expenditure is projected to increase at an average annual rate of 6.4 per cent to R662.6 million in 2011/12, compared to R550.3 million in 2008/09. The increase in expenditure is driven by the need to recruit and retain critical skills, invest in the development of human resources, create and entrench South African Bureau of Standards brand awareness, and maintain and improve infrastructure.
Capital amounts of R174.2 million in 2010/11 and R81.2 million in 2011/12 will be received from the Department of Trade and Industry for a major infrastructure project to relocate approximately 6 000 m2 of chemical, biological and physical testing laboratories to newly built laboratories. The vacated laboratory space will be refurbished.
Policy and Legislative Development develops coherent, predictable and transparent regulatory solutions. Funding is mainly used for salaries and related personnel costs.
Enforcement and Compliance ensures that participants in economic activities comply with consumer and corporate rules. Funding is mainly used for inspectors' salaries.
Competition Commission promotes competitive market conditions through investigating and prosecuting anti-competitive activities. Funding is based on the approved business plan of the commission and supporting memorandums of understanding.
Competition Tribunal adjudicates all major mergers and alleged restrictive practices. Funding is based on the approved business plan of the tribunal and supporting memorandums of understanding.
National Consumer Tribunal ensures equity in the credit market and balances the rights and responsibilities of credit providers and consumers. Funding is based on the approved business plan of the tribunal and supporting memorandums of understanding.
National Credit Regulator regulates the consumer credit industry to improve consumer protection in the end user credit market. Funding is based on the approved business plan of the regulator and supporting memorandums of understanding.
National Gambling Board provides a regulatory framework for gambling practices. Funding is based on the approved business plan of the board and supporting memorandums of understanding.
National Consumer Commission ensures well functioning markets that are fair, competitive and responsible to consumers. Funding is based on the approved business plan of the commission and supporting memorandums of understanding.
World Intellectual Property Organisation facilitates a South African contribution to an international regime for intellectual properties. Funding is based on membership fees for the organisation.
Increase access to economic opportunities for historically disadvantaged individuals by overseeing the department's 9 regulating entities.
implementing amendments to the Competition Act (1998) in 2008/09 reviewing the Lotteries Act (1997) and the Estate Agency Affairs Act (1976).
The Competition Amendment Act (2008) deals with price fixing cartels, market allocation, collusion and collusive tendering in highly concentrated markets. The Consumer Protection Act (2008) prevents consumers from being harmed and strengthens their economic welfare by adopting consumer rights and responsibilities when transacting with suppliers and providing efficient redress. The new Companies Act (2008) reduces the regulatory burden on small businesses and simplifies the registration process, as well as promoting corporate governance and market transparency to encourage investor confidence. A research project on the effectiveness of the Estate Agency Affairs Act (1976) has been completed, and a policy framework for revising this legislation has been prepared. A similar review process was completed for the Lotteries Act (1997). The National Credit Act (2007) protects consumers against reckless lending and indebtedness, and prevents credit providers from harming consumers by placing the duty to determine what they can afford on the credit providers. Since the implementation of the act three years ago, reckless credit lending has decreased and household debt has been contained, assisting South African consumers to survive financially in the current global financial crisis.
In 2007/08, the department finalised 625 credit consumer complaints and R765 588 was recovered for consumers through alternative dispute resolution mechanisms. The average turnaround time was 20 days per complaint. 26 reactive investigations were received and finalised, and 20 new proactive investigations were conducted. 23 proactive investigations were concluded, of which 7 were carried over from the previous year. High profile investigations conducted in 2007/08 included reverse mortgage schemes, transport contracts, and mail order marketing scams. Several money making scams were referred to the commercial branch of the South African Police Service. In 2007/08, 161 company complaints were finalised, 65 search and seizure operations conducted, 7 inspection requests disposed of, and 3 comprehensive inspections finalised.
Over 10 000 students from further education and training colleges benefited from a financial literacy campaign.
Policy and Legislative Development 5.8 8.6 8.7 18.1 14.8 15.9 16.
Enforcement and Compliance 19.7 31.2 27.7 30.5 46.0 49.3 51.
Regulatory Services 68.1 91.4 101.5 124.5 177.7 199.8 219.
Total 93.6 131.2 137.9 173.2 238.6 265.0 287.
Change to 2008 Budget estimate (11.4) 36.0 43.1 66.
Current payments Compensation of employees Goods and services of which: Administrative fees Advertising Assets less than R5 000 Communication Computer services Consultants and professional services: Business and advisory services Consultants and professional services: Legal costs Contractors Inventory: Stationery and printing Owned and leasehold property expenditure Travel and subsistence Operating expenditure Venues and facilities 30.8 45.9 39.1 53.3 62.4 66.4 62.5 18.7 12.1 0.1 1.2 0.0 0.1 - 5.4 0.9 0.0 0.5 - 2.3 1.0 0.4 29.0 16.9 0.1 0.1 0.0 0.2 - 7.50.8 0.0 0.7 - 4.2 1.4 1.9 29.7 9.4 0.3 1.2 0.0 0.2 0.1 2.2 0.4 0.0 0.3 0.63.4 - 0.4 33.8 19.5 - 0.2 - 0.3 -12.0 - -0.9 - 4.5 - 1.6 38.7 23.7 0.5 0.1 1.0 0.4 0.6 8.8 - 1.0 0.9 - 5.6 2.7 2.2 40.5 25.9 0.5 0.1 0.9 0.4 0.6 7.6 - 1.11.0 - 7.0 4.0 2.6 38.8 23.7 0.6 0.2 1.0 0.5 0.7 8.8 - 1.2 1.2 - 5.4 2.5 1.
Transfers and subsidies 62.4 85.1 98.5 119.1 175.2 197.6 224.
Payments for capital assets 0.4 0.3 0.3 0.7 0.9 1.0 1.
Departmental agencies and accounts Departmental agencies (non-business entities) Current Companies and Intellectual Property Registration Office Competition Commission Competition Tribunal Micro Finance Regulatory Council National Credit Regulator National Gambling Board National Consumer Tribunal National Consumer Commission Foreign governments and international organisations Current World Intellectual Property Organisation 60.7 82.8 96.2 116.7 172.6 194.8 221.2 4.3 28.2 - 15.9 - 12.3 - - - 17.3 8.0 - 37.9 19.6 - - - 23.2 8.7 - 44.5 19.8 - - - 44.0 9.9 - 34.1 17.3 11.4 - - 67.7 13.0 - 43.9 20.6 17.5 9.9 - 73.8 13.6 - 45.9 21.6 20.1 19.8 - 86.6 15.2 - 51.0 23.6 23.8 21.0 1.6 2.0 2.3 2.5 2.6 2.8 2.9 1.6 2.0 2.3 2.5 2.6 2.8 2.
Expenditure increased rapidly from R93.6 million in 2005/06 to R173.2 million in 2008/09 at an average annual rate of 22.8 per cent. Expenditure rose markedly in 2006/07, increasing by 40.2 per cent, mainly due to the establishment of the National Credit Regulator and the incorporation of the Micro Finance Regulatory Council into the regulator. Spending is projected to grow at an average annual rate of 18.4 per cent over the medium term to reach R287.8 million in 2011/12.
The increase of 108 per cent in the Policy and Legislative Development subprogramme in 2008/09 is mainly due to the revision and drafting of the new Companies Act (2008) and the introduction of the National Credit Act (2007). An increase in human resources was necessary to deal with the growing legislative workload in consumer and corporate regulation.
58.4 per cent between 2005/06 and 2006/07, mainly due to the rapid increase in compensation of employees and associated goods and services expenditure. Increased funding over the medium term reflects the department's drive to improve regulatory oversight, consumer awareness and law enforcement, evident in the increasing allocations for compensation of employees in all three subprogrammes. The largest increase is concentrated in the Regulatory Services subprogramme, which accounts for the majority of spending on consumer and corporate regulation. Expenditure rises from R124.5 million in 2008/09 to R219.2 million in 2011/12 at an average annual rate of 20.8 per cent.
Transfers and subsidies also rise rapidly over the medium term, from R119.1 million in 2008/09 to R224.2 million in 2011/12. This is driven by the growth in transfers to the Competition Commission, the National Credit Regulator and the National Consumer Tribunal.
Incentive Administration manages and implements existing incentive schemes.
Coega Development Corporation provides bulk infrastructure development at the Coega industrial development zone, encouraging companies to invest in South Africa and facilitating sustainable growth and employment. Funding is based on the approved business plans of the company.
East London Industrial Development Zone Company provides bulk infrastructure development at this industrial development zone, encouraging companies to invest in South Africa and facilitating sustainable growth and employment. Funding is based on the approved business plans of the company.
Richards Bay Industrial Development Zone Company provides bulk infrastructure development at this industrial development zone, encouraging companies to invest in South Africa and facilitating sustainable growth and employment. Funding is based on the approved business plans of the company.
Critical Infrastructure Programme provides bulk infrastructure development, assisting green or brown field companies to invest in South Africa. Grants are based on qualifying criteria and approved applications.
Black Business Supplier Development Programme provides incentives to qualifying companies, which support black business suppliers. Grants are based on qualifying criteria and approved applications.
Business Process Outsourcing Programme provides incentives to qualifying companies, which support the establishment of international call centres in South Africa. Grants are based on qualifying criteria and approved applications.
Cooperatives Incentive Scheme provides incentives to qualifying companies, through which cooperative enterprises in the emerging economy acquire business development services. Grants are based on qualifying criteria and approved applications.
Enterprise Development for the Small and Medium Enterprise Development Programme provides incentives to qualifying companies, through which a grant is payable to local and foreign investors starting or expanding current operations. Grants are based on qualifying assets and projects.
Small and Medium Manufacturing Development Programme provides incentives to qualifying companies, through which a grant is payable to local and foreign investors starting or expanding current operations. Grants are based on qualifying assets and projects.
Export Marketing and Investment Assistance Programme provides incentives to qualifying companies, through which the costs of developing export markets and recruiting foreign direct investments are partially compensated. Grants are based on qualifying criteria and approved applications.
Film and Television Production Incentive Scheme provides incentives to film and television production companies. Grants are based on qualifying criteria and approved applications.
Staple Food Fortification Programme provides incentives to the graining milling industry for buying and installing capital equipment for staple food fortification. Funding is based on the calculation of mill size as a percentage of the qualifying costs, to a maximum of R40 000 per complete fortification unit.
Automotive Production and Development Programme provides incentives to qualifying motor vehicle manufacturers, whereby motor vehicle assembling in South Africa is supported. Grants are based on qualifying criteria and approved applications.
New Incentive Development develops packages of incentives to support the national industrial development policy and sector strategies. Funding is mainly used for salaries and other personnel related costs, especially research projects.
Business Development and After-Care facilitates access to targeted enterprises. Funding is mainly used for salaries.
developing and implementing 4 packages of incentives relating to manufacturing, tourism, skills and competitiveness by February 2010 monitoring the effectiveness of the 4 framework incentive schemes by developing indicators and targets by February 2010 and monitoring their performance on an ongoing basis developing administrative capacity in support of the framework by upgrading the IT system by 2009 to improve claims administration and reduce times for processing claims from 90 days to 30 days on average assessing the effectiveness of incentive schemes by reviewing the impact of at least 3 schemes by March 2010.
The industrial development zones have secured further commitments to investment. In 2007/08, the Coega Development Corporation secured 9 investors with an estimated total investment value of R5.9 billion. The East London Industrial Development Zone Company finalised location agreements with 6 investors, 3 of which are for the automotive sector, with an estimated total investment value of R271 million. The Richards Bay Industrial Development Zone Company secured 2 key investors, a ferrochrome smelter and a pulp mill, with an estimated total investment value of R2.3 billion. Phase 1 of Tata Steel's ferrochrome smelter was completed in 2007/08 at a cost of R850 million. In the first half of 2008/09, the Coega industrial development zone exported biomass and frozen yoghurt products worth US$14 million. The East London industrial development zone conceptualised and constructed a dedicated automotive supplier park as a flagship cluster development. 38 050 components are manufactured per day, equating to 1.2 million components in 2007/08, of which 948 000 (79 per cent) were exported and the remainder was sold to the local market.
The enterprise investment programme was launched in July 2008, and the small medium enterprise development programme was closed for applications in 2007/08. Subsequently, 4 510 projects were approved under the small medium enterprise development programme. The projected investment value of these projects over a 3-year period is R29.3 billion in productive capital assets, creating an estimated 106 440 jobs.
A film and television production rebate programme was introduced in 2004 to attract large foreign and local productions into South Africa. Having provided rebates for several successful productions, the department nevertheless realised that there should be more measures to support the local industry. In February 2008, this programme was replaced with a new incentive, with a budget of R806.1 million over the next 3 years. The new film production incentive programme has approved 31 productions: 17 South African, 12 foreign, and 2 coproductions. Together they qualify for a total rebate of R147 million. On completion, the projects are expected to have spent R1 billion in South Africa on goods and services. Of this, R789 million is direct foreign expenditure.
In March 2007, an incentive package for business process outsourcing and off-shoring investors was launched. R710.2 million is allocated for these incentives over the MTEF period. To date, 14 applications have been approved with 12 000 call operator seats, representing a total investment of R1.1 billion. These businesses are expected to create 15 000 jobs over the next 3 years, more than half of the 25 000 target.
Incentive Administration 1 016.8 1 425.3 2 552.2 2 406.1 3 426.7 2 853.0 3 017.
New Incentive Development 2.3 2.8 3.1 3.1 5.3 6.6 6.
Business Development and After-Care 7.7 6.1 7.7 7.4 7.9 9.3 9.
Total 1 026.7 1 434.3 2 563.1 2 416.6 3 440.0 2 868.8 3 034.
Administrative fees 0.1 0.2 0.
Advertising 0.1 0.2 0.1 0.2 0.4 0.4 0.
Assets less than R5 000 0.0 0.0 0.0 - 0.0 0.0 0.
Bursaries (employees) 0.0 - 0.
Consultants and professional services: Legal costs 2.2 0.9 0.5 - 0.1 0.1 1.
Contractors 0.0 0.0 0.
Agency and support / outsourced services 0.9 0.
Entertainment - 0.0 0.0 - 0.1 0.2 0.
Inventory: Other consumables 0.0 0.0 0.0 - 0.0 0.0 0.
Inventory: Stationery and printing 0.6 1.1 1.0 1.2 1.2 1.3 2.
Owned and leasehold property expenditure 0.0 0.0 0.0 - 0.1 0.1 0.
Travel and subsistence 2.1 3.2 5.0 9.0 8.6 6.0 10.
Training and development 0.0 0.0 0.
Operating expenditure 0.4 0.2 0.4 - 0.3 0.3 0.
Venues and facilities 0.1 0.3 0.8 3.0 1.0 1.4 1.
Transfers and subsidies 989.8 1 391.9 2 511.8 2 343.8 3 358.9 2 787.5 2 940.
Provinces and municipalities 0.1 58.
Public corporations and private enterprises 989.7 1 333.7 2 511.6 2 343.8 3 358.9 2 787.5 2 940.
Payments for capital assets 0.2 0.6 0.7 0.8 0.8 0.9 0.
Machinery and equipment 0.2 0.6 0.7 0.8 0.8 0.9 0.
Provinces and municipalities Provinces Provincial revenue funds Capital Industrial development zones grant Public corporations and private enterprises Public corporations Other transfers Capital Coega Development Corporation East London Industrial Development Zone (Pty) Limited Richards Bay Industrial Development Zone Company - 58.
Current 789.6 759.9 1 177.4 1 249.7 1 639.4 1 686.6 1 779.
Business Process Outsourcing - - 35.6 110.0 210.0 245.1 255.
Enterprise Development 723.8 676.6 1 040.2 977.8 916.9 733.2 627.
Film and Television Production Incentive 41.3 72.4 96.0 154.2 246.9 268.9 290.
Sector Development Programme - - - 0.0 10.0 1.8 3.
Small and Medium Manufacturing Development Programme 24.6 11.0 5.6 4.7 1.2 1.2 1.
Staple Food Fortification Programme - - - 3.0 1.0 0.
Industrial Development Zones-Other - - - 0.0 4.5 5.6 1.
Enterprise Investment Programme - - - 0.0 249.0 430.7 601.
Capital - - - - 248.3 297.0 316.
Automotive Production and Development Programme - - - - 248.3 297.0 316.
Current 97.8 105.7 123.2 146.5 187.9 193.2 200.
Black business supplier development programme 15.9 25.0 28.5 25.3 38.9 40.6 43.
Co-operatives incentive scheme - 3.8 - 9.3 34.5 41.6 39.
Export market and investment assistance 81.8 75.7 89.8 111.9 114.4 111.0 118.
South African Capital Goods Feasibility Study Fund - 1.3 4.
Capital 24.9 88.2 360.2 75.1 105.6 115.7 118.
Critical infrastructure programme 24.9 88.2 60.2 75.1 105.6 115.7 118.
Critical infrastructure programme: ALCAN aluminium smelter - - 300.
Expenditure has increased consistently, rising from R1 billion in 2005/06 to an expected R3 billion in 2011/12. Between 2005/06 and 2008/09, expenditure increased rapidly, reaching R2.4 billion in 2008/09, at an average annual rate of 33.9 per cent. Much of the growth since 2007/08 was due to larger capital injections into the industrial development zones, including R300 million for infrastructure investment for the Alcan aluminium smelter, and R110 million to establish business process outsourcing.
The increases of 40.1 per cent and 47.5 per cent on compensation of employees and goods and services in 2008/09 are mainly due to an increase in the number of new incentives schemes, which required more human resources capacity.
Over the medium term, expenditure growth stabilises, rising by an average annual rate of 7.9 per cent between 2008/09 and 2011/12. This disguises an expenditure peak at R3.4 billion in 2009/10 for transfer payments to companies assisted through the small medium enterprise development programme, the critical infrastructure programme, and the companies located in the three industrial development zones. In 2008/09, R1.5 billion was paid to cover incentive schemes, and R872.5 million was paid to the industrial development zones.
Investment Promotion and Facilitation facilitates the increase in the quality and quantity of foreign and domestic direct investment by providing an investment recruitment, problem solving and information service to retain and expand investment in South Africa and into Africa. Funding is mainly for salaries for analysts and associated costs.
Export Development and Promotion develops new and existing South African exporter capabilities to grow exports. It provides information, financial support and practical assistance to sustain organic growth in traditional markets and penetrate new high growth markets.
Export Consultancy Trust Fund: International Bank for Reconstruction and Development (World Bank) undertakes feasibility studies for capital goods and projects initiated by the World Bank. Funds are distributed based on approved World Bank projects.
Export Consultancy Trust Fund: International Finance Corporation assists South African businesses to be successful in dealing with the International Finance Corporation as an investment in building a long term sustainable export strategy for South African goods and services. Funding is distributed based on diligence investigations and pre-feasibility studies.
Export Credit Insurance Corporation provides long term insurance and investment guarantees on behalf of government, and facilitates and encourages South African export trade by underwriting foreign bank loans and investments to enable foreign buyers to purchase capital goods and services from South Africa. Funds are distributed based on approved projects.
International Operations manages and administers the department's foreign office network. Funding is used for salaries, especially for trade advisors, and the costs of operating foreign trade offices.
Promote awareness of investment opportunities in South Africa by conducting 3 international investment conferences, 95 investment presentations, 6 South African exhibitions (pavilions) and 5 ministerial or presidential missions by March 2010.
Improve the capacity of new exporters by training 200 new small exporters, reaching 2 000 customers and distributing 3 000 publications by March 2010.
Promote South African products in targeted high growth markets by conducting 6 international trade initiatives and 25 pavilions, and fund 50 trade missions through export council and provincial investment promotion agencies by March 2010.
Facilitate markets for Southern African products and services by promoting and implementing 8 export projects in high yield targeted countries by March 2010.
To implement the export strategy, approved in 2008, a national exporter database and an export portal were completed and 49 trade missions and 30 national pavilions supported. 225 companies underwent training and attended international events through the small exporters development programme. The Mzansi project, aimed at showcasing South African arts and crafts, will be launched in 2009.
Domestic and international investment was mobilised, generating a possible 74 projects worth R206 billion, with the potential of creating more than 30 000 jobs. Domestic investment projects are worth R153 billion and foreign investments R53 billion. Of the R206 billion, R171 billion is committed, or in progress. Manufacturing accounts for R19.7 billion, resources for R182.7 billion, and services for R3.6 billion. This has been achieved by focusing on customer needs, reducing lengthy administrative procedures, and providing an all encompassing service to investors.
Two presidential international investment conferences and one investor conference were facilitated in 2008.
Investment Promotion and Facilitation 35.3 28.4 24.6 36.1 29.7 32.3 34.
Export Development and Promotion 249.0 169.1 153.4 175.2 177.3 179.4 189.
International Operations - - 106.5 86.5 76.1 91.0 99.
Total 284.3 197.4 284.5 297.8 283.1 302.7 323.
Change to 2008 Budget estimate 0.4 (15.4) (11.7) (4.
Current payments Compensation of employees Goods and services of which: Administrative fees Advertising Communication Computer services Consultants and professional services: Business and advisory services Consultants and professional services: Infrastructure and planning Contractors Entertainment Inventory: Stationery and printing Lease payments Owned and leasehold property expenditure Travel and subsistence Operating expenditure Venues and facilities Financial transactions in assets and liabilities Transfers and subsidies Provinces and municipalities Departmental agencies and accounts Public corporations and private enterprises Foreign governments and international organisations Households Payments for capital assets Machinery and equipment 90.2 133.6 148.9 163.2 128.3 139.1 149.6 56.3 34.0 0.6 1.3 1.5 0.2 1.4 - - 0.6 1.7 8.6 - 10.3 6.0 1.5 - 71.7 53.8 1.0 2.2 2.1 0.3 3.1 1.0 -1.2 1.1 14.5 1.5 14.1 5.7 5.6 8.1 83.0 65.9 1.2 2.2 2.5 0.4 - - 3.0 1.5 1.2 14.5 2.0 17.6 6.1 13.3 0.0 86.3 76.9 - 1.9 1.5 1.1 4.0 - - -1.4 6.2 - 18.1 - 42.7 - 80.4 47.9 0.2 1.3 1.2 1.2 1.7 - 1.3 0.6 1.1 4.8 0.4 13.8 7.6 12.5 - 86.0 53.1 0.2 1.4 1.2 1.2 1.7 - 1.3 0.7 1.1 5.0 0.4 14.7 7.8 16.0 - 85.8 63.8 0.2 1.6 1.5 1.5 2.1 - 1.6 0.8 1.3 6.0 0.5 17.4 9.5 19.
Public corporations and private enterprises Public corporations Subsidies on production or products Current Aichi exposition Public corporations and private enterprises Public corporations Other transfers Current Export Credit Insurance Corporation Foreign governments and international organisations Current Export Consultancy Trust Fund: International Bank for Reconstruction and Development (World Bank) 25.2 4.
Export Consultancy Trust Fund: International Finance Corporation 4.2 4.5 4.7 5.0 5.2 5.5 5.
Expenditure increases moderately over the seven-year period, rising from R284.3 million in 2005/06 to an expected R323.1 million in 2011/12, at an average annual increase of 2.2 per cent. The increase is mainly due to increased funding of export and investment promotion. It is mostly for reviewing and developing export related policies and providing for the interest make-up scheme for export reinsurance. This also results in a rapid increase in transfers to the Export Credit Insurance Corporation, which rise from R123.6 million in 2008/09 to R159.5 million in 2011/12.
Expenditure in the Investment Promotion and Facilitation subprogramme reflected growth of 46.7 per cent in 2008/09, rising from R24.6 million in 2007/08 to R36.1 million in 2008/09. This considerable increase is due to an additional allocation for the development of an investment promotion and facilitation strategy and for research. The strategy aims to raise the level of South Africa's direct investment and the exports of its goods and services to and from priority markets.
Brand Management is responsible for managing the department's image and ensuring that excellent customer service standards are upheld by improving customer touch points and ensuring strong customer relationship management.
External Communications is responsible for outreach programmes and educational campaigns to ensure a meaningful understanding of the department's offerings.
Media Relations and Public Relations ensures that the department's image is visible by improving media relations management and public relations activities.
Promote awareness of the department's impact on growth and development by increasing awareness campaigns on the department's programmes from 8 campaigns in 2009 (2 per quarter) to 12 in 2011 (3 per quarter).
increasing the frequency of media updates from an average of 8 per month currently (bi-weekly) to an average of 20 per month (daily) in 2009 increasing the number of media briefings from 8 per year (2 per quarter) to 16 per year (4 per quarter) by 2011.
Over the past 18 months, the department held 149 events, exhibitions and imbizos. 103 print and electronic publications were produced, reaching 18 million people. The department also distributed 48 media releases, conducted 205 daily media monitors, forwarded 36 media reports to its management forum, and held 21 media briefings.
Brand Management 11.8 8.0 17.3 27.5 20.3 22.1 23.
External Communications 18.9 12.0 14.0 25.2 30.1 33.0 34.
Media Relations and Public Relations 42.0 45.9 30.2 19.1 15.4 19.8 20.
Catering: Departmental activities 0.0 0.0 0.7 - 0.8 0.8 0.
Consultants and professional services: Business and advisory 28.8 20.3 0.5 3.5 5.6 6.0 6.
Contractors 0.2 4.3 2.1 - 9.4 10.0 11.
Non-profit institutions - 10.
In the Communication and Marketing programme, expenditure decreased from R72.7 million to R61.5 million between 2005/06 and 2007/08, mainly due to lower expenditure on consultancy services and financial transactions in assets and liabilities. Over the medium term, expenditure is expected to rise from R71.7 million in 2008/09 to R79 million in 2011/12 at an average annual rate of 3.3 per cent. This is mainly due to inflation related increases in marketing costs, including publications and other media related costs.
In the Brand Management subprogramme, expenditure increased from R8 million to R17.3 million between 2006/07 and 2007/08 mainly due to increased marketing costs.
The Companies and Intellectual Property Registration Office was established in 2002 as a trading entity of the Department of Trade and Industry with the mandate to register and administer cooperatives, companies, close corporations and intellectual property rights, including patents, trademarks, copyrights and designs.
Between 2005/06 and 2008/09, the number of new companies registered was consistently over 36 000 per year, with a peak of over 48 000 in 2005/06. Close corporations reflected the largest increase in registrations, with 135 438 new close corporations registered in 2004/05, and a record number of 251 996 in 2007/08.
A number of interventions improved service delivery to the businesses served by the office. These include the conceptualisation of e-CIPRO, which aims to provide an online service to clients, as well as the decentralisation of the office's services through third party partners.
The Companies and Intellectual Property Registration Office is gearing itself to implement new legislative changes, such as the revision of the Companies Act (1973), to establish and entrench good corporate governance and broad geographical access to the office's services.
In 2007/08, the Companies and Intellectual Property Registration Office obtained an unqualified audit report from the auditor-general for the second consecutive year. It also obtained ISO 9001 accreditation. The office continued with the automation of most of its business processes and the electronic lodgement system.
The office also implemented annual returns for close corporations, and about 4 000 annual returns were lodged for public companies. More than 250 000 close corporations and 33 000 companies were registered, with a slower rate in the registration of cooperatives. The reason for the decline in cooperative registration figures could be the new requirements of the Cooperatives Act (2007).
The Companies and Intellectual Property Registration Office is still experiencing an increasing demand for its services, with 450 000 applications being filed for stakeholders' perusal.
The office conducted fraud awareness campaigns for staff and clients, and a people development strategy aiming to instil a high performance culture was adopted. A comprehensive enterprise wide risk register was compiled in 2008.
Non-tax revenue 208.9 252.5 308.1 308.6 324.5 346.7 352.
Sale of goods and services other than capital 204.1 236.6 277.7 298.4 319.4 344.1 350.
Administration fees 204.1 236.6 277.7 298.4 319.4 344.1 350.
Other non-tax revenue 4.7 16.0 30.3 10.2 5.2 2.6 2.
Transfers received 4.5 3.
Transfers and subsidies - - - 0.0 0.0 0.0 0.
The Companies and Intellectual Property Registration Office raises its revenue through registration fees. As a self-funding entity, no transfers have been made to the office since 2006/07. Annual returns for close corporations were introduced in 2008/09.
The Companies and Intellectual Property Registration Office has experienced a significant increase in expenditure, from R125.3 million in 2005/06 to R278 million in 2007/08, due to retained earnings approved by National Treasury. The retained earnings have been earmarked for acquiring capital assets and funding identified projects and programmes for service delivery improvement. The decline in expenditure from R351.2 million in 2010/11 to R337.7 million in 2011/12 is due to the completion of the capital acquisition phase of the service delivery improvement projects.
The National Lotteries Board enforces and monitors the implementation of the national lottery, and the establishment of private lotteries and promotional competitions. The entity manages the National Lotteries Distribution Trust Fund, which distributes proceeds from its share of the lottery sales to worthy causes.
The board's budget is approved annually by the Minister of Trade and Industry, who takes into consideration available surpluses before approving funds to be drawn from the trust fund for operating expenses. The board's funding has been derived entirely from the trust fund. Interest revenue by the trust fund refers to interest earned on funds received from licence holders. These funds are invested until they are disbursed to worthy causes. Transfers and subsidies reflect payouts to charity, arts and culture, and sport organisations benefiting from the trust fund.
Objectives for the medium term include improving the regulation of the national lottery, increasing the capacity of the board, improving the trust fund's distributions, developing the stakeholder interface, assuming a greater grant making leadership role, improving legislation, and improving communications.
Value of operator ticket sales each year National Lottery Regulation R3.64bn R3.83bn R2.04bn R4.12bn R3.75bn R3.82bn R3.
Value of contribution to the National Lotteries Distribution Trust Fund each year National Lottery Regulation R1.24bn R1.30bn R690m R1.40bn R1.28bn R1.30bn R1.
Value of trust fund grant commitments each year National Lottery Distribution R1.20bn R760m R860m R1.40bn R1.49bn R1.51bn R1.
Actual cash disbursed each year National Lottery Distribution R1.02bn R800m R630m R1.00bn R1.40bn R1.43bn R1.
Despite the initial setback in the awarding of the second lottery licence, the lottery is now fully operational. The distribution of proceeds from the lottery operator is also in line with past trends. Distributing agencies are fully operational, and site visits to beneficiaries are taking place in response to needs. The re-engineering exercise has been completed and staff capacity has been increased.
Non-tax revenue 1 541.3 1 649.2 1 316.1 1 981.1 1 840.3 1 870.6 1 876.
Transfers and subsidies 1 199.1 764.3 863.3 1 400.0 1 488.6 1 508.9 1 500.
Total expenses 1 219.9 794.2 915.9 1 472.1 1 576.0 1 601.7 1 597.
Accumulated surplus/deficit 2 137.0 2 992.0 3 392.2 3 901.2 4 165.6 4 434.4 4 714.
Trade and other payables 1 627.3 1 607.9 1 667.9 2 193.7 2 304.1 2 348.1 2 358.
Provisions 1.3 1.2 1.4 1.4 1.4 1.5 1.
Total equity and liabilities 3 765.7 4 601.0 5 061.4 6 096.3 6 471.1 6 784.0 7 074.
Proceeds from the lottery operator decreased significantly in 2007/2008 due to operational delays in the national lottery in the early part of the year as a result of the change in the national lottery operator contract. Transfers and subsidies were also lower for 2006/07 and 2007/08 because of the late establishment of the new distributing agencies. The substantial increase in current expenses in 2007/08 and 2008/09 is due to improved organisational capacity and the re-engineering of systems and procedures to improve overall service delivery.
R million 2007/08 2007/08 2008/09 2008/09 1. Administration 361.4 343.9 310.8 398.1 (2.9) 395.2 395.2 2. International Trade and Economic 140.7 140.7 133.5 148.8 2.6 151.3 151.
Empowerment and Enterprise 1 769.2 1 808.0 1 472.1 1 220.9 (43.4) 1 177.5 1 177.
Industrial Development 147.1 155.0 331.8 387.8 55.8 443.6 443.6 5. Consumer and Corporate Regulation 2 082.8 2 704.2 137.9 173.5 (0.3) 173.2 173.2 6. The Enterprise Organisation 260.1 258.5 2 563.1 2 402.3 14.3 2 416.6 2 366.6 7. Trade and Investment South Africa 84.3 69.2 284.5 297.4 0.4 297.8 297.8 8. Communications and Marketing - - 61.5 73.8 (2.1) 71.7 71.
Total 4 845.6 5 479.4 5 295.4 5 102.6 24.3 5 126.9 5 076.
Current payments Compensation of employees Goods and services Financial transactions in assets and liabilities Transfers and subsidies Provinces and municipalities Departmental agencies and accounts Universities and technikons Public corporations and private enterprises Foreign governments and international organisations Non-profit institutions Households Payments for capital assets Buildings and other fixed structures Machinery and equipment Software and intangible assets 871.8 795.1 746.9 984.3 (14.5) 969.8 969.8 323.5 548.4 - 310.7 484.3 - 327.5 393.6 25.9 375.4 608.9 - 36.6 (51.1) - 412.0 557.8 - 412.0 557.
Table 32.B Summary of personnel numbers and compensation of employees Table 32.
Compensation (R million) 228.4 277.1 320.7 404.9 443.0 468.5 478.
Compensation (R million) - 4.6 4.9 5.1 5.4 5.5 5.
Unit cost (R million) - 0.0 0.0 0.0 0.0 0.0 0.
Compensation of employees (R million) 230.6 283.6 327.5Training expenditure (R million) 12.2 3.2 1.0Training as percentage of compensation 5.3% 1.1% 0.
Households receiving bursaries (R million) - 0.3 0.
Adjusted appropriation Medium-term expenditure estimate 2008/09 2009/10 2010/11 2011/12 412.0 450.5 476.2 486.1 2.5 9.3 8.0 9.5 0.
Industrial development zones grant - 58.
Total - 58.
Projects signed in terms of Treasury Regulation 16 99.5 138.0 152.9 162.8 169.
PPP unitary charge Advisory fees Project monitoring cost 99.5 - - 135.6 2.4 - 148.2 159.6 166.8 4.5 3.0 2.5 0.2 0.2 0.
Total 99.5 138.0 152.9 162.8 169.
Significant contingent fiscal obligations including termination payments, guarantees, warranties and indemnities and maximum estimated value of such liabilities Department of Trade and Industry campus Department of Trade and Industry campus, Meintjie Street, Pretoria. Design, construct and facility management services over 25 years 1 August 2003 25 years CPIX linked - July every year on anniversary Variation orders as per allowed schedules - but no formal amendment to date was signed on the public private partnership agreement Costed per each variation order.
Projects signed in terms of Treasury Regulation 16 - 3.4 3.8 4.2 4.
PPP unitary charge1 - 3.4 3.8 4.2 4.
Total - 3.4 3.8 4.2 4.6 1. Phavis fleet services PPP. Disclosure notes for this project can be viewed in the PPP annexure table of the Department of Transport.
Table 32.G Summary of expenditure on infrastructureTable 32.
Coega industrialdevelopment zone Bulk infra-andtop structures(providing roads, electricity, water, sewerage, railroads, andbridges) Increased investment base and promoting foreign directinvestment. Value addedmanufacturing, investment, increased exports and jobcreation. Providing infra- and top structures to investors Basic infrastructure and some of thetop structures for Zone 1 completed 9 502.5 58.9 249.8 726.0 718.4 859.9 495.0 524.
East London industrialdevelopment zone Bulk infra-andtop structures(provisioning ofroads, electricity, water, sewerage, railroads, andbridges) Increased investment base and promoting foreign directinvestment. Value addedmanufacturing, investment, increased exports and jobcreation. Providing infra- and top structures to investors Basic infrastructure and some of thetop structures for Zone 1 completed 1 916.2 17.7 130.0 124.9 154.0 249.
Critical infrastructure BulkInfrastructure Infrastructure projects in supportof a particular investment in the areas of mining, tourism, manufacturing, and the services industry. The expectedoutcomes are mainly contribution to economic growth, job creation, SMMEs, and BEE Operational since 2001 1 819.7 24.9 88.2 60.2 75.1 105.6 115.7 118.
Richards Bay industrialdevelopment zone Bulk infra- andtop structures Increased investment base and promoting foreign directinvestment. Value addedmanufacturing, investment, increased exports and jobcreation. Providing infra- and top structures to investors Increased investment base and promoting foreign direct investment. Value added manufacturing, investment, increased exports and job creation. Providing infra- and top structures to investors 721.7 - 34.8 - 0.0 68.
Centurion AerospaceVillage BuildingCenturionAerospaceVillage Establishment of aeromechanical manufacturingabilities. Establishment of an aerospace supplier park. Situation of Aerosud and Denelin aerospace village. Implementation phase 260.0 - - - 20.
Total 14 220.0 101.5 502.8 911.0 967.6 1 283.3 610.7 643.
EuropeanUnion Sector wide enterpriseemployment and equityprogramme Empowerment andEnterprise Development 450 000 Publiccorporations andprivate enterprises Training and mentoring inexport, entrepreneurship and other related fields.
EuropeanUnion Risk capital facilityprogramme Empowerment andEnterprise Development 450 000 Publiccorporations andprivate enterprises Facilitation of BEE in the small and medium size enterprisessector. 52 jobs created since2008. 2 investments to the value of R47.