Minister on Department of Tourism & South African Tourism strategic plans and budget briefings
Chairperson: Mr D. Gumede (ANC)
Date of Meeting: 14 Mar 2011
Minister Marthinus Van Schalkwyk addressed the Committee on three issues, namely, international arrivals, domestic tourism and unilateral taxes by European Union countries. He noted that in 1994 tourism contributed 5% towards the national Gross Domestic Product. The figure currently sat at 7.7%. Tourism was slowly taking its place as an important part of the economic sector. Tourism was part of the National Growth Plan. He specifically asked the Committee to take heed of the problem that unilateral departure taxes could have on tourism in
The Department of Tourism comprehensively briefed the Committee on its Strategic Plan for the period 2011/12-2015/16. Members were provided with an overview of each of the Department’s four Programmes, namely Administration, Tourism Development, Tourism Growth and lastly Policy, Research, Monitoring and Evaluation and the planned initiatives within each programme. The financials of the Department were also presented including a breakdown of allocations per programme.
The Committee was also presented with South African Tourism’s updated Strategic Plan for the 5 year period 2011/12-2015/16. Members were provided with explanations of the various markets that SA Tourism focussed its efforts on ie core markets (attractive and easier markets) examples Angola, USA and Australia, tactical markets (less attractive but easier markets) examples New Zealand, Ireland and Lesotho, investment markets (attractive but difficult markets) examples DRC, Brazil and China and lastly watch-list markets (less attractive and difficult markets) examples Austria, Argentina and Malawi.
SA Tourism identified four strategic outcomes orientated goals which identified areas of organisational performance that were critical to the achievement of its mission. Strategic Outcome Orientated Goal 1 was to market South Africa in such a way that annual arrivals to the country would increase, Strategic Outcome Orientated Goal 2 was to market SA in such a way that the expenditure of all people arriving to the country would increase, Strategic Outcome Orientated Goal 3 was to market South Africa in such a way that South Africa became the most preferred tourism brand by 2014 and finally Strategic Outcome Orientated Goal 4 was to continuously improve SA Tourism’s internal policies and procedures.
Due to time constraints limited interaction took place between members and the presenters on the presentations that had been made. Some of the issues that were discussed was how tourism was affected by climate change, what the budgeted expenditure on domestic tourism was and what the reasons were behind the planned construction of hotels and conference facilities at the
The Minister of Tourism, Mr Marthinus van Schalkwyk and the Director General of the National Department of Tourism, Mr Kingsely Makhubela supported by a large contingent was in attendance. Ms Thandiwe January-Mclean, Chief Executive Officer and Mr Johan van der Walt, Chief Financial Officer, represented South African (SA) Tourism.
Chairperson’s Opening Remarks
The Chairperson at the outset of the meeting thanked the Minister and the Department for the wonderful leadership that had been shown at the Tourism Summit which the Committee had hosted recently. He also thanked the Director General and his team for the inputs that were made at the
Minister’s Opening Remarks
Minister van Schalkwyk noted that in 1994 tourism contributed 5% towards the national Gross Domestic Product (GDP). The figure currently sat at 7.7%. Tourism was slowly taking its place as an important part of the economic sector. Tourism was part of the National Growth Plan. He stated that he would comment on three issues, namely, international arrivals, domestic tourism and lastly unilateral taxes by European Union countries. In 2010 there had been good growth in international arrivals. The 2010 FIFA World Cup was the basis for the increase. Growth was evident for each of the months of 2010. The Minister was proud that
National Department of Tourism Strategic Plan for a Period 2011/12-2015/16
Ms Nomzamo Bhengu Chief Director: Business Performance, Strategic Partnership and Risk Management, Department of Tourism, undertook the briefing. Ms Bhengu provided the Committee with an overview of each of the Department’s Programmes, namely Administration, Tourism Development, Tourism Growth and lastly Policy, Research, Monitoring and Evaluation and the planned initiatives within each programme. She also highlighted the Department’s strategic goals which were to achieve good corporate and co-operative governance. She proceeded to provide a detailed breakdown of each of the Department’s programmes by elaborating on each programme’s strategic objectives, its risks and mitigating factors, and its indicators and targets.
Having an effective organisational performance management system and a capable and skilled workforce were some of strategic objectives. One of the risks was poor implementation of systems, the mitigating factor was that there was to be developed and implemented an Enterprise Architecture Framework for the Department. Relating to indicators and targets the baseline current vacancy rate was 21%, the idea was to reduce the funded vacancy rate by 10%during 2011/12.
To create employment opportunities by implementing tourism projects targeted at the unemployed was a strategic objective. Fraud, corruption and conflict of interest was identified as a risk with the corresponding mitigating factor being that investigations would be conducted on all suspected cases and to institute disciplinary measures on implicated officials. On indicators and targets the number of unemployed youth trained in hospitality fields and placed for experiential learning was 300.
To improve service levels in the tourism industry was a strategic objective. Lack of co-operation by government entities and stakeholders to support government initiatives was identified as a risk; the corresponding mitigating factor was to ensure early engagements and consultation of the sector and stakeholders and the review of significance of current structures versus beneficiation by the electorate. On indicators and targets the number of young people trained and placed as chefs per year in the hospitality industry baseline figure sat at 150, during 2011/12 the idea was to recruit, train and place 800 young persons.
Policy, Research, Monitoring and Evaluation
Monitoring and evaluation of tourism sector performance, strategies and policies was identified as a strategic objective. Non compliance and unavailability of data/information were risks which could be mitigated by developing monitoring and evaluation frameworks and reporting schedules and purchasing data from other sources respectively. As far as indicators and targets were concerned the frequency of state of tourism reports for example would be one per financial year.
Mr Ralph Ackerman Chief Financial Officer continued with the financials of the Department. He provided the Committee with a breakdown of allocations per programme. For the financial year 2011/12 the total allocation was R1.242.876bn. The allocations per programme were Administration- R173.763m; Tourism Development- R348.140m; Tourism Growth-R694.074m and Policy, Research, Monitoring and Evaluation-R26.899m. There had been an increase of 7.9% in the budget from R1.151.836bn in 2010/11 to R1.242.876bn in 2011/12.
On the issues of filling of vacancies that the Chairperson had mentioned earlier in the meeting, Mr Ackerman stated that the Strategic Plan had been aligned with the Budget. The filling of posts had to be phased in. Only in the third year would the posts be fully funded.
The Chairperson asked whether there were projects that were not mentioned in the presentation.
Mr Makhubela conceded that there were projects not mentioned in the presentation. For example the issue of the Convention Bureau and the lack of funding associated with it were one such project. Tourism needed to focus its efforts on emerging markets like
The Chairperson stated that watching expenses was all good and well but in order to get things done money needed to be spent. Everything costs money and it t was indeed a balancing act between saving and spending. The issue of the Department’s Budget was an ongoing dialogue which needed to continue.
South African (SA) Tourism updated Strategic Plan for the 5 year period 2011/12-2015/16
Mr Johan van der Walt continued with a brief breakdown of SA Tourism’s consolidated key performance areas for 2011/12 financial year. Approved CPIX parameters for SA was 5.8% for
The Chairperson stated that due to time constraints the number of questions by members would be limited. Perhaps questions could be reserved for when the Committee next met the Department and SA Tourism.
Ms M Njobe (COPE) asked how tourism was affected by issues of climate change. She referred to the presentation document of the Department on pages 12 and 13 and asked why the terminology of black graduates and black SMMEs was used. What portion of SA Tourism’s budget was spent on domestic tourism? She referred to the Department’s decision to place the opening up of an office in
Mr Myron Peters Chief Director: Consumer Protection and Responsible Tourism stated that the Department of Environmental Affairs had a Green Paper on climate change. He noted that each sector including tourism had to develop a Climate Change Plan. The Plan related directly to business in the tourism sector. For example floods would affect food supply in the industry, rising temperatures affected flora and fauna and drought affected water supply. Plans had to be in place to regulate waste as well, for example to curb carbon emissions.
Mr Makhubela responded that there were huge disparities in figures of SMMEs. In
Ms January-Mclean stated that there was no doubt about
Mr van der Walt stated that the domestic tourism budget for 2011/2 was R19.5m. The domestic tourism budget was the same as the previous year. The idea was to make domestic tourism a stand alone unit.
Ms J Terblanche (DA) requested SA Tourism to furnish Members with copies of the presentation document. It was difficult to follow the presentation without having a hard copy. She asked what the opinion of SA Tourism and the Department was on the building of extra hotels and conference facilities in the
Mr van der Walt replied that the
Mr Makhubela pointed out that the Department was guided by the Department of Environmental Affairs on the
Ms J Maluleke (ANC) referred to the Department’s disability figures (on employment) sitting at 2% and asked if it a problem to reach the 5% as suggested by the Deputy Minister.
Mr Makhubela stated that the Department’s target for disabled persons was 2%. The Department’s actual figure was 2.5%. The new target was now 5%. There were challenges in meeting the target of 5% but it was nevertheless achievable.
The meeting was adjourned.