Department of Tourism and South African Tourism on their Strategic Plan 2011

Committee: Tourism

Chairperson: Mr D Gumede (ANC)

Date of Meeting: 28 Mar 2011

Summary

The Committee met the Department of Tourism and South African Tourism for briefings on their Strategic Plan 2011/12 – 2015/16. The Department of Tourism’s focus areas would be job-creation, rural development, strengthening the domestic tourism sector. The National Tourism Sector Strategy would prove to be an important tool in ensuring the effective coordination of all spheres of Government as well as other sector stakeholders. The upcoming launch of the National Events and Convention Bureau would aim to attract the hosting of international conferences locally. The Department’s management capabilities were good and its management systems sound. It would however be initiating change in areas where such change was necessary, such as better governance around its social responsibility initiatives. It would also be leveraging numerous international events which would allow it better exposure as well as the opportunity to find international best practices of countries around the world which had successful tourism sectors.

Members asked what had been done to ensure that the youth in rural areas were given information around its chef recruitment and training programme, how many conference facilities were at the planning phase and how many were at the implementation phase, whether the figures for the number of jobs the Department intended creating were realistic, whether the number of vacancies would have an adverse effect on the implementation of its strategic plan, why there had been a decline in funding of the Expanded Public Works Programme (EPWP) and why it did not place more emphasis on entrepreneur training.

South African Tourism said that there had been an increase of 15.1% in tourist arrivals in 2010 which was significantly higher than was the trend internationally. Domestic tourism was a key factor in ensuring the growth of the South African tourism industry and needed to be prioritised and strengthened. Key focus areas for the 2011/12 financial year included the leveraging of the positivity around the 2010 World Cup. South African Tourism’s key marketing strategy would be linked to wildlife, adventure, hospitality and welcoming people. A new grading system had been introduced and it had also established an internal audit unit. The regions which showed the most growth was Central and South America as well as North America.

Members asked what budget South African Tourism would need in order to create the optimal level of advertising that would in turn ensure a greater generation of jobs and an increase in South Africa’s gross domestic product and tax revenue, and what was being done to encourage all sectors of South African society to travel more locally.


Minutes

Department of Tourism Presentation
Mr Kingsley Makhubela, Director-General, Department of Tourism, said that the Department would be redeploying both tangible and intangible resources in its focus on job-creation. Another of its focal points was that of rural development through which it would be emphasising cultural and heritage tourism. It would also be prioritising the strengthening of the domestic tourism sector through spending more resources on it as well as looking towards improving the coordination of all levels of Government in this regard. It was, to this end, planning on initiating a conference at which all spheres of Government could decide how best to promote the domestic tourism sector. The recently launched National Tourism Sector Strategy (NTSS) was an important tool in this regard as it had already seen buy-in from the private sector. It would also, in the coming financial year, be launching the National Events and Convention Bureau which would aim to attract people to host, in particular, business conferences and seminars locally. Although the Department’s management capabilities were good, it would be improving the efficacy of those management systems that needed improving, such as better governance around social responsibility initiatives. It would also be looking at its organisational structure with a view towards ascertaining whether it allowed it to best fulfil its mandate. It would also be leveraging numerous international events which would allow it better exposure as well as the opportunity to find international best practices of countries around the world which had successful tourism sectors.

Discussion
The Chairperson asked why there had been no excitement generated around the up-coming skateboarding world championship to be held in the Northern Cape. Was the province up to the task at hand and, if not, would it need assistance?

Mr Dirk van Schalkwyk, Chief Operating Officer, Department of Tourism, said that the Department had indicated its support, though there had been no further engagement between it and the province in this regard. The Department’s Social Responsibility unit was however supporting the province in terms of the project management of the event. The province was clear that it was an event which it wished to drive and manage.

The Chairperson asked how many conference facilities were at the planning phase and how many were at implementation phase.

Ms Buella Mosupye, Chief Director: Sector Transformation, Department of Tourism, answered that this information could be provided to the Committee in writing.

Ms M Njobe (COPE) asked whether the figures for the number of jobs the Department intended creating were realistic. Would the number of vacancies have an adverse effect on the implementation of its strategic plan?

Mr Makhubela answered that, as the NTSS was a sector-wide document, the targets listed therein were for the entire sector. The sector was, however, committed to meeting the targets it had set. Some of the challenges the Department had in relation to the filling of vacancies were largely as a result of a lack of space. The move to its new office had been delayed. Once this delay was overcome the necessary posts would be filled.

Ms J Maluleke (ANC) asked why there had been a decline in funding of the Expanded Public Works Programme (EPWP).

Mr Ralph Ackerman, Chief Financial Officer, Department of Tourism, replied that this decline was as a result of the division of the erstwhile Department of Environmental Affairs and Tourism and the Department now being a standalone Department.

Ms V Bam-Mugwanya (ANC) asked why, in relation to its chef recruitment and training programme, the Department did not place more emphasis on entrepreneur training.

Mr Makhubela answered that this was done in an attempt to fill the skills gap in this area.

Ms X Makasi (ANC) asked whether a skills audit had been conducted around bursaries so as to address skills shortages.

Mr Makhubela answered that the Department had reached an agreement with two universities, though any effective research in this regard would require long-term planning.

Ms Mosupye added that it had conducted a skills audit which indicated a list of scarce and critical skills. It would be conducting another such review in the coming financial year.

Ms Njobe asked what the Department was doing around eradicating pollution in the sector.

Mr Makhubela answered that it had engaged with the sector around the need to prioritise renewable energy. It was acknowledged that there was a need for investment in the green economy. It was critical for the sector to adhere to the principles of responsible tourism.

Ms Bam-Mugwanya asked whether the Department was comfortable with the arrangement whereby resources that should be housed within it were housed within the Department of Trade and Industry instead. Did the Department have access to these funds?

Me Makhubela answered that incentives here were with the Department of Trade and Industry. There were no resources within the Department to fund emerging businesses although discussions around shifting these to the Department were being held.

South African Tourism Presentation
Mr Timothy Scholtz, Chief Operations Officer, South African Tourism, said that there had been an increase of 15.1% in tourist arrivals in 2010 which was significantly higher than the trend internationally. This was largely as a result of the impact of the 2010 World Cup. Domestic tourism was a key factor in ensuring the growth of the South African tourism industry and, considering the decline in figures in this sector, needed to be prioritised and strengthened. Work also needed to be done around maintaining awareness of South Africa as a travel destination internationally. To this end it would be rolling out the second phase of its ‘Experience it in 20 Days campaign’. Key focus areas for the 2011/12 financial year were the leveraging of the positivity around the 2010 World Cup with its key marketing strategy linked to wildlife, adventure, hospitality and welcoming people. A new grading system had been introduced and it was continuing vigorously to assess the establishments on its database. It had also established an internal audit unit. It had a vacancy rate of 8% though it was in the process of filling these positions (particularly the junior positions) at a rapid rate. The regions which showed the most growth were Central and South America as well as North America.

Discussion
Mr G Krumbock (DA) asked what budget South African Tourism would need in order to create the optimal level of advertising that would in turn ensure a greater generation of jobs and an increase in South Africa’s gross domestic product (GDP) and tax revenue.

Mr Johan van der Walt, Chief Financial Officer, South African Tourism, answered that South Africa’s spend on tourism promotion (0.1% of its GDP) was, in comparison to that of Australia and Brazil (0.6% and 0.7% respectively), relatively low. Return on investments in this regard was measured annually and the cut-off figure here was 1:35. Currently, all the markets in which it was investing were yielding returns of more than this figure. Growth was expected to come from the growing middle-class across Africa, emerging markets and countries such as Mexico and China. Promoting direct airlift was also important as this would increase tourist arrivals.

Ms Njobe asked what was being done to encourage all sectors of South African society to travel more locally.

Mr Scholtz answered that South African Tourism was currently looking at re-initiating its Sho’t Left campaign. It would also be reviewing who its target market in this regard is as it had been found that young people were not spending enough here. It had secured trade deals with various players in the private sector in an attempt to boost domestic tourism.  

The meeting was adjourned.