Minister in the Presidency (Statistics South Africa) Budget Speech

Minister in the Presidency, Mr Jackson Mthembu, gave his Budget Vote on the 9th July 2019

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Honourable Chairperson of the Session, Hon Cedric Frolick 
Honourable Chairperson and Members of the Portfolio Committee 
Honourable Members of the House, 
Chairperson of the South African Statistics Council, Prof David Everatt, 
Members of the South African Statistics Council 
Statistician-General, Mr Risenga Maluleke, 
Our Distinguished Guests in the Gallery, 
Ladies and Gentlemen,

It is my honour to present the 2019/20 budget of Statistics South Africa (Stats-SA), an institution which is so critical in our pursuit of building the South Africa we want. We deliver this budget just a few weeks after the people of South Africa entrusted us with the mandate to govern this beautiful country of ours for the next five years. We again want to express our sincerest gratitude to South Africans for granting us another opportunity to continue in our pursuit of delivering a better life for all. We assure you that we will not rest until we have implemented all programmes set out in our elections Manifesto and the key priorities of this 6th Administration as articulated by our President in the State of the Nation Address (SONA).

During the State of the Nation Address, His Excellency, President Cyril Ramaphosa called upon all of us to prioritise the reduction of poverty, and the growth and transformation of our economy to serve all people of South Africa. The President also called upon us to prioritise consolidating the social wage through reliable and quality basic services; focus on education, skills and health; spatial integration, human settlements and local government as well as building a capable, ethical and developmental state among other priorities.

As it stands, our economy is not growing fast enough, in fact, Stats-SA informed us that the economy shrunk by 3.2% in Quarter 1 of 2019, which shows that a lot more needs to happen in the economic space. Unemployment as the biggest driver of poverty has been stubbornly above the 25% mark over the last 10 years with the last quarter being 27,6 %. The picture painted by statistics is not always rosy, however, we do not want rosy pictures for its own sake. The data shows us where the problems are and it provides baseline information which is critical for shaping the improvements necessary.

Honourable Chairperson, as we deliver this budget speech, we must keep in mind that we are striving to improve the human capital base of the economy.

We are searching for ways of reducing inequalities in both per capita income and expenditure.

We want to modernise the public service for it to be agile and capable to deliver to our people.

We want to sufficiently industrialise and diversify as we improve the performance of our economy.

Essentially honourable Chairperson, we want to build an entrepreneurial, responsive and capable developmental state.

Therefore, independent, good-quality official statistics are fundamental for building the capable developmental state we want. Such statistics provide knowledge and insight to us as policy makers and the general public. They illustrate what the state of our nation is and give the reality of our people’s everyday lives. They assist in identifying needs, setting goals and monitoring progress. They give us the ability to make decisions informed by scientific evidence. The availability and reliability of scientific evidence also enhances transparency and accountability in our policymaking and implementation process. It also makes it easier for government and citizens alike to monitor our performance in implementing our priority areas.

As an institution for measurement, Stats-SA is responsible for the production and coordination of official and other statistics on changing dynamics in the economy, society and the environment. It publishes more than 250 statistical releases each year, and compiles statistical research that measures development against the National Development Plan (NDP) and government’s Medium Term Strategic Framework (MTSF), in conjunction with global and continental agendas for sustainable development. The work of Stats-SA therefore serves as reference points of where we are, how far we have travelled to reach our targets and what we still need to do.

Honourable Members, because of this crucial role played by this institution, we encourage Stats-SA to keep producing Statistics, independently and free from political and other interferences, which gives credence to policymaking and implementation processes in our democratic dispensation.

Globally, official statistics are underpinned by the United Nations Fundamental Principles of Official Statistics and in Africa, by the African Charter on Statistics. Our own Statistics Act advances the production and use of official and other statistics in line with these international statistical principles and practices.

Honourable Chairperson,

We are very proud of the institution we have built as a democratic state over the past 25 years. Stats-SA is ranked among the best in the world when it comes to good statistical practice and transparency. They continue to participate in international statistical development initiatives and discourse to advance statistical practice in South Africa, Africa and the World.

The employees of Stats-SA, whom I had the pleasure of interacting with recently, are among the best trained Statisticians in the world and in this regard, we have become a victim of our own successes as we have in recent years seen international institutions recruiting some of our most experienced statisticians. These institutions include the likes of the United Nations, the World Bank, Statistics Australia etc.

In my recent interaction with Senior Management at Stats-SA as led by Statistician-General, Mr Risenga Maluleke, I was informed that the institution underwent budget cuts to the tune of approximately R177 million in 2017/2018. I was also informed that this has negatively affected the institution’s ability to cover Compensation of Employees (CoE), thereby leading to their inability to retain critical skills and fill critical vacancies.

I have also been informed that the budget cuts have led to overspending on Compensation of Employees by R92 million in 2018/19 and projected to overspend by R78 million in 2019/20, notwithstanding these challenges, the institution still received an unqualified audit opinion.

As the Executive, we will verify the history of what informed such alleged budget cuts, which has negatively affected their finances on the Compensation of Employees. We are of the view that it is important to satisfy ourselves on the history and reasoning of such alleged cuts particularly as they relate to the institution’s ability to compensate their employees.

We will all agree that the current financial situation of Stats-SA is unsustainable and we will therefore engage the National Treasury on how best this untenable situation can be normalized to ensure that Stats-SA continues to meet our national demand for statistical information.

Furthermore, because government is not the only client Stats-SA services; business and other organisations who make use of Stats-SA products in their planning, monitoring and evaluation activities, as well decision-making processes, will also be approached with a view of having them make a contribution in order for us to keep our Stats-SA ranked among the best in the world. We are also, through innovation and modernization, exploring the use of digital platforms to ensure we maintain and improve our level of competitiveness with the Europeans on data.

Notwithstanding these challenges, Stats-SA has continued to deliver statistics on key indicators such as the Gross Domestic Product (GDP), Unemployment Rates, Population Estimates, Consumer Price Index (CPI), Poverty and Service Delivery Indicators, as well as Fertility and Mortality Rates in the country.

Honourable Chairperson,

A new Statistics Council, an independent body which has a responsibility to advise both the Minister and the Statistician-General, was appointed earlier this year. The Council promotes and safeguards the integrity of our statistics system and the health of Stats-SA. The Council, under the leadership of Prof David Everatt, has advised me as the Minister responsible for statistics, to approve the work programme of Stats-SA, in line with Section 13 of the Statistics Act.

Over the medium term, Stats-SA (the department) plans to continue focusing on modernising its operations; implementing statistical reform, particularly in statistical coordination; and maintaining an adequate supply of statistical information in preparation for and after the national census in 2021/2022.

The department has a total budget of R10,7 billion over the Medium Term Expenditure Framework (MTEF) period, of which R7, 5 billion is earmarked for operational expenditure and R3,2 billion for spending related to Census 2021.

For the 2019/2020 financial year, the department will be focusing on the following key priorities to fulfil its mandate:

1. Legislative reform
2. Rolling out an Integrated indicator framework
3. Maintaining the quality of core statistics
4. Integrating, innovating and modernising the statistical value chain
5. Preparing for Census 2021 and;
6. Driving transformation and organisational reform

Legislative reform:

Honourable Members, we have reviewed our statistics legislation and compiled an amendment to the Statistics Act, with the aim of driving statistical reform in the country, with particular emphasis on statistical coordination, statistical geography, the data revolution, a state-wide statistical service, and institutional arrangements. Based on the outcomes of stakeholder consultations, a draft Statistics Amendment Bill is expected to be tabled in Parliament in 2019/2020.

Integrated indicator framework:

An integrated indicator framework has been developed that aligns policy agendas at various levels such as the Sustainable Development Goals (SDGs) at a global level, Agenda 2063 at a continental level, the National Developmental Plan (NDP) and the Medium Term Strategic Framework (MTSF) at a national level and Provincial Growth and Development Plans (PGDP) at provincial level, as well as District Growth and Development Plans (DGDP) and Integrated Development Plans (IDP) at district and local level. All these form the basis of what needs to be measured in the National Statistics System.

During 2019/20, the department will focus on rolling out the integrated indicator framework among organs of state in order to strengthen statistical coordination and production in the statistical system. The integrated framework will be used as a guide to inform prioritisation of statistical series and operations.

For statistical coordination, including legislative reform, R85,7 million has been allocated over the medium term in the National Statistics System sub-programme in the Administration programme. This will assist in the development of a national statistics strategy, the provision of statistical support and the coordination of surveys on behalf of organs of state.

Maintaining the quality of core statistics:

Stats-SA delivers more than 250 statistical products annually. In order to sustain this investment and trust of users, and to raise the level of responsiveness to the growing demand, the department will reprioritise and rationalise its resources to ensure that the quality of core statistics is maintained and delivered. During 2019/20, the department will be engaging users on their needs and demands as well as on the rationalisation of statistical products and series.

Integrating, innovating and modernising the statistical value chain: Honourable Members, technology and new statistical methodologies will be our strategic enablers to innovate the statistical value chain for better efficiency. In 2019/20, the department will continue with the roll-out of the computer-assisted personal interview (CAPI) methodology in its Household Surveys Programme. Digitalisation of our work methods, in line with the expectations of digital services and efficiencies in the context of the Fourth Industrial Revolution, will enable us to deliver faster, smarter and more cost-effectively.

Preparing for Census 2021:

Honourable Chairperson, conducting a population census is the biggest statistical survey any country and a national statistics agency can undertake. The design and development of new and innovative collection methodologies, with testing and preparatory work for developing the geospatial information frame, is scheduled for 2019/20; which will be followed by the pilot census in 2020/21, with the actual census undertaken towards the end of 2021. The department has allocated R145,3 million in 2019/20, R855 million in 2020/21 and R2,2 billion in 2021/22 for these and other activities related to the Census.

To conduct a continuous population survey to measure poverty, the wealth gap and service delivery in South Africa, additional funding of R105,8 million is allocated in 2021/2022 in the Poverty and Inequality subprogramme under the Population and Social Statistics Programme.

Transformation and organisational reform:

Honourable Members, the transformation and change agenda will drive organisational reform in core functional and operational areas in terms of systems, processes, structures and people. Key focus areas include the implementation of a structure review, reprioritisation and rationalisation of resources, as well as developing a new strategic direction for statistical development in 2019/20.

In conclusion Honourable Members, as a country, we need a robust statistical system that will provide us with the evidential knowledge base to build a capable developmental state and to hold government accountable through evidence-based planning, monitoring and evaluating impact.

As this is my first budget speech, I would like to thank my predecessors, former Minister Jeff Radebe, and the Honourable Dr Nkosazana DlaminiZuma for their sterling work in overseeing this institution. I take the baton from their capable hands to ensure that this organisation retains its status as one of the leading statistics organisations globally.

We would like to express our gratitude to the South African Statistics Council for their unrelenting support to statistical development in our country.

We want to express our appreciation to the Statistician-General, Mr Risenga Maluleke and the entire Stats-SA staff, for steering this ship and ensuring that it remains on course at all times.

We also want to sincerely express our gratitude to the dedicated members of the Portfolio Committee on Public Service and Administration, Planning Monitoring and Evaluation for engaging us on matters statistics.

We hereby request Parliament to support and approve the budget allocation to Statistics South Africa for the year 2019/2020.

I Thank you Honourable Chairperson and Honourable Members!