Expanded Public Works Programme: Department of Public Works update

NCOP Public Services

16 August 2010
Chairperson: Mr M Sibande (ANC)
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Meeting Summary

The Department of Public Works presented an update on the Expanded Public Works Programme. Goals included the creation of 4.5 million work opportunities for poor and unemployed people in South  Africa, contributing towards halving unemployment by 2014, through the delivery of public and community services, scaling up Further Education and Training. The Expanded Public Works Programme (EPWP) would enable government to act as an  employer of last resort, as part of the  Anti-Poverty Strategy. The targets for each sector and year were outlined and the Department noted the new programmes and addition of another four municipalities to the Food for Waste programme. The Infrastructure Incentive Grant was beginning to have the desired effect. An incentive would be given to environment and culture sectors from this financial year. Challenges across the sectors including the fact that the labour-intensity of projects was not being optimised by Provincial Departments and municipalities, lack of technical capacity and institutionalised human resources to drive projects and interventions. Management and coordination across all three spheres of government remained problematic. There was also no non-wage funding to kick-start key programmes. The Department’s responses to these challenges included offering technical support, setting up of key partnerships and encouraging replication of highly labour-intensive programmes, as well as continuing training on labour-intensive methodologies. The Minister of Public Works was encouraging greater political buy-in, and target agreements were signed with Premiers. The Expanded Public Works Programme Incentive was described, as well as the Environmental sector incentive. The EPWP incentive would probably account for R85.9 million in this financial year. Eight departments in five provinces, and 56 eligible municipalities had been paid. For the non-State sector, the budget allocation was R204.5 million, including a transfer of R14.5 million to the Independent Development Trust (IDT), which was the appointed intermediary to manage this sector on behalf of DPW. Comparisons were made with the previous financial year. The Department then reported on performance, noting that support was being given to public bodies, the Siena Mange programme, together with the Development Bank of Southern Africa, was giving support to municipalities, and training and technical support were outlined. Proposals for 2011/2012, which were still being considered, included increasing the minimum FET payments, allowing 10% of incentives to be used for project management capacity, and integration of incentives.

Members pointed out that Further Education and Training Colleges were suffering through skewed allocations, asked the Department to ensure that there was no delay in funding, and voiced concerns that the system had never worked well and there were not sufficient skilled people to manage the colleges to ensure that people were properly trained. They called for expansion of the School Nutrition Programmes. Members stressed that more should be done for the rural areas, and that it was vital to achieve enlistment there. They did not feel that the correct balance had been attained, particularly in the previously disadvantaged areas, felt that insufficient detail was given on the provinces, some of whom were not doing enough, and cautioned that these provinces might try to rush their spending in the fourth quarter of the financial year. Members also noted that although the target for creation of new job opportunities had been exceeded, the 900 000 job losses should also be taken into account. The Department explained the distinction between jobs and work opportunities. Members asked about recruitment of Non Governmental Organisations, noted that some areas never had these organisations and suggested that more be done to promote them. They asked about training of municipal officials, asked whether it was necessary to introduce so many new programmes, and asked for more detail on the Food for Waste programmes. They suggested that the South African Local Government Association should be signing agreements on behalf of municipalities and monitoring the situation, asked how the Department verified alignment between the plans and the report backs from municipalities, and commented that systems must be better aligned.

Meeting report

Expanded Public Works Programme (EPWP): Department of Public Works (DPW) update
Mr Stanley Henderson, Acting Deputy Director-General, and Department of Public Works, detailed the five year targets and outlined the progress of the Department of Public Works (DPW) up to March 2010. He outlined the goals as including the creation of 4.5 million work opportunities for poor and unemployed people in South  Africa, contributing towards halving unemployment by  2014, through the  delivery of public and community services. This would in part be achieved by the scaling up of Further Education and Training College courses, from 210 000 in  year 1 to 610 000 in year 5. The Expanded Public Works Programme (EPWP) would enable government to act as an employer of last resort, as part of the  Anti-Poverty Strategy.

He outlined the Phase II Targets per sector and per year. The new programmes being added included Kari Gude, School Nutrition and Mass Participation Programmes. The Food for Waste Programme would add another four municipalities in 2010/11, to cover ten municipalities. There were to be 900 new Vuk’uphile Learnerships.

Mr Henderson said that the Infrastructure Incentive Grant was beginning to have its intended effect of encouraging public bodies to exceed the targets for FET training. From 2010/11 the Environment and Culture sectors would also have an incentive allocation

Mr Henderson outlined the challenges across the sectors. The labour-intensity of projects was not being optimised by Provincial Departments and Municipalities. There was lack of technical capacity in public bodies to implement projects, and of institutionalised human resources to drive development interventions. Data capturing capacity was lacking, to report properly on implemented projects. Management and coordination across all three spheres of government remained problematic. There was also no non-wage funding to kick-start key programmes across all sectors. The Department had developed certain responses to overcome these challenges. It was offering technical support to improve labour-intensity in implementation of projects. It had some key partnerships and was developing new ones to join with existing support initiatives. The replication of highly labour-intensive programmes was being encouraged. There was continued training of municipal officials in labour-intensive methodologies, and capacity support was given to teams of data capturers. The Minister of Public Works was encouraging greater political buy-in, through signing target agreements with Premiers. New funding proposals were developed to assist implementing bodies to start new programmes.

Mr Henderson then introduced Members to the Expanded Public Works Programme (EPWP) Incentive. This had been introduced to all sectors in the 2010/11 financial year. It was applicable to Provincial Departments and Municipalities. The Environmental sector incentive was applicable to National Departments, through their appropriations from National Treasury. A non-State sector grant was paid to Non-Government Organisations (NGOs) and Non-Profit Organisations (NPOs) through the Independent Development Trust (IDT), which was appointed as the intermediary. The Social sector grant was paid as a Schedule 5 grant to Provincial Departments of Social Development and Education.

In the current year the incentive had been paid to eight of the eligible departments in five provinces, and of the R330.67 million made available in this financial year, R85.943 million would probably be paid, judging on the first quarter reporting. This represented 26% of the Provincial allocation. 56 of the eligible Municipalities had been paid the incentive, in all the Provinces, which represented 32% of the Municipal allocation for the 2010/11 financial year.

In the non-State sector (NSS), the final budget allocation was R204.5 million.  This was the result of an additional allocation of R114.5 million for the Community Works Programme (CWP) in the adjustment budget. This money included a transfer of R14.5 million to the Independent Development Trust (IDT), which was the appointed intermediary to manage the NSS on behalf of DPW. The allocation was made up of wage costs, totalling R91 million, and non-wage costs, totalling R58.5 million.

Mr Henderson then detailed the Community Works Programme Budget performance for the 20009/10 financial year, and the NGO performance for the same period (see attached presentation).

In respect of performance on the EPWP Incentive draw-down, he noted that public bodies were being provided with support to report on EPWP, including employment of the 90 data capturers.  A partnership with Development Bank of Southern Africa (DBSA) through the Siena Mange programme had been put in place to support municipalities jointly. Training of officials in Municipalities in labour-intensive methods of construction was being planned with the Local Government Sector Education and Training Authority, and technical support was provided to them to ensure that projects were implemented more labour-intensively. Training on reporting was also being given to public body officials to enable them to report better on EPWP.

Proposals that were under consideration for 2011/12 included increasing the minimum FET payment to R60 for Provincial Departments and Metropolitan municipalities, while it would be increased to R70 in rural municipalities. New provisions would be introduced to allow 10% of the incentives earned to be used for project management capacity. Integrated incentives would be introduced. A non-wage component would be introduced for the non-State sector and the nominal amount for eligible public bodies would increase. 

Mr Henderson concluded that the DPW had managed to bring more public bodies on board with its communication drives, that the drive for political champions was succeeding but had to be intensified, and that collective responsibility for EPWP must be tied to delivery forums and agreements.

Mr O de Beer (COPE, Western Cape) noted that the Further Education and Training (FET) Colleges were suffering because the allocation of resources was skewed. He hoped that there would be no delay in funding so that operations on distribution and resources of Fetes could proceed.

Mr Henderson replied that the DPW has negotiated directly with the Department of Education as well as the Department of Labour about funding in order to channel this money into the relevant programmes and also to ensure that funds would be received faster.

Mr de Beer stated that while the EPWP target for the previous financial year was 550 000 work opportunities, which had been exceeded with the creation of 627 000 opportunities, it must also be borne in mind that job losses in that same period amounted to 900 000.

Mr Henderson replied that the EPWP distinguished between a work opportunity and a job. A job would provide a sustainable permanent income, as opposed to what the Department offered, which was the running of a project for six months. However, whilst this was not sustainable, the opportunity should not be shunned, because it made a huge difference to the lives of poorer people. The development of back-to-back programmes, in order to provide ongoing work and projects, was under discussion

Mr de Beer said the Committee understood school nutrition programmes but would like to see an expansion of them, mostly in the rural areas, as children in these areas were dependent on them. He also asked how the EPWP was helping with rural area enlistment.

Mr Henderson said that many problems at municipal level were ongoing, and had not been eradicated, but this did not mean that the Department had not made progress on the way in which some municipalities had dealt with EPWP. All municipalities had the responsibility to report back on EPWP, and that included the rural areas.

Mr De Beer asked whether there was a central database which was used for the recruitment of Non Governmental Organisations (NGOs) and whether recruitment was politically aligned.

Mr Henderson mentioned that NGOs were recruited by way of advertisements in newspapers so that all NGOs were able to access the incentives. However the drawback may have been that NGOs in rural areas may not have had access to those advertisements. He said that there was a built-in rural bias, meaning that bigger cities such Johannesburg or Cape Town had a much higher threshold to access the wage incentive, whereas in rural areas it was zero, in order to make it easier for these areas to access the incentives.

Mr De Beer asked about the training of officials in municipalities. He wanted to establish whether these officials were on the DPW payroll and whether they were trained to work at council level or on the budget of the council, and what impact this would have on budgetary processes.

Mr Henderson replied that the funding arrangement for training of municipal officials was handled through the Sector Education and Training Authority (SETA) so that there was not a burden on municipal funds.

Mr H Groenewald (DA, North West) also asked for clarity on the creation of jobs against the loss of 900 000 jobs. He said that during the Committee’s visit to labour centres in Cape Town, it had found that 400 people per day were looking for work and applying to the Unemployment Insurance Fund. He noted that if this was the situation in a small part of the country, then the total picture was much wider, and it must be even worse in rural areas.

Mr Henderson said that he had already spoken of the creation of jobs or work opportunities. The Department did whatever it could to ensure the optimisation of work opportunities.

Mr Groenewald said that FET colleges were also a matter of concern to him. He felt that this system had never worked well, and there were not skilled people to manage these colleges to see that people were trained properly to secure employment.

Mr Groenewald felt that new programmes were necessary, but also wondered if and why old programmes were discarded. Millions of rends had been spent on these programmes, and millions more would be needed to set up new programmes again.

Mr Henderson responded that the old programmes had not been discarded, but that the Department needed to think beyond the existing programmes. New programmes had to be implemented constantly to ensure the creation of work opportunities, while existing programmes were being strengthened.

Mr Groenewald said that provinces that had not been doing anything up to now was another issue of concern, particularly rural provinces who had not started to use the money allocated to them. Because they tended only to start making an effort in the fourth quarter of the financial year, the money had to be channelled fast into spending, and he feared that this might give rise to fraud or the channelling of the money in the wrong direction.

Mr Henderson said that poor performance of municipalities was due to a range of reasons, such as poor reporting, inaccurate capturing of data, poor planning by the implementing body and lack of technical expertise.

Ms M Themba (ANC Mpumalanga) requested more detail and information concerning the provinces. She felt that the information presented was vague and suggested that the Members must be given a more detailed report on what was happening in provinces such as Mpumalanga.

Mr Henderson said the provincial breakdown of these municipalities would be sent to the Committee Secretary for distribution.

Ms Themba said that the presentation had merely stated that Food for Waste Programmes would cover ten municipalities, but did not elaborate further, and she asked for more detail.

Mr Henderson replied that the Food for Waste Programme cut across four provinces. Even though waste management was a key municipal concept, it was not taking place as it should. For this reason the DPW would be providing 100% of the funding to get the project off the ground in the first year, 70% of funding in the second, and 30% of funding in the third year. By the fourth year the project should be able to run on its own.

A Member was concerned with the equity and the distribution of resources. She said that the department was not meeting what the administration was trying to achieve. The correct balance was not being achieved, particularly in regard to the previously disadvantaged areas, which were not getting more resources, funding or programmes. She asked how it would be ensured that areas that had never had any NGOs would now get what they needed. She pointed out that the delivery vans were simply not arriving in disadvantaged areas.

Mr Henderson stated that the Department would be keeping a close watch on equity issue, to ensure that there was compliance with the agreements and protocols around equity.

Mr Z Mlenzana (COPE, Eastern Cape) said that the presentation was unclear as to which Premiers had or had not signed this agreement. Municipalities were subject to their provinces. He suggested that it might be preferable for the South African Local Government Association (SALGA) also to sign agreements on behalf of municipalities, so that there was a body taking responsibility.

Mr Henderson said that SALGA had made a plea to the DPW for more human resources, and the Department will work closer with them to address these issues.

Mr Mlenzana asked how the Department would verify that the report-back received from municipalities was in conjunction with the EPWP plan.

Mr Henderson responded that the Department would check how the municipalities had used funds in order to create work opportunities. This was a major indicator in verifying funds. The municipalities  would initially also have received a set allocation for this and it was strictly audited

The Chairperson said that data capturing was a particularly important topic as he felt that systems across municipalities were not synchronising with each other. There seemed to be little communication between them.

Mr Henderson conceded that there was a constant struggle to align systems, and this compromised the quality of data. The Department had developed a website to ensure the proper flow of data.

The Chairperson said out that a blind eye was being turned to people with disabilities and there were few programmes benefitting them, or indeed benefiting women’s empowerment or people in rural areas. There were few NGOs in rural areas.

Ms Themba agreed and said that the Department should encourage people to form NGOs in rural areas.

Mr Henderson answered that there were clear targets for designated groups such as the disabled, and the Department itself had ensured proper access to buildings for people with disabilities.

A Member raised concerns about what formula was used to distribute the money, and whether equitable principles would guide the Department.

Mr Henderson responded that there were more people in some provinces and therefore those provinces received bigger budgets. The approach that the Department had taken was that the bigger the budget, the higher the threshold, and the smaller the budget, the lower the threshold.

The meeting was adjourned.


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