Department of Labour on its Strategic Plan 2011 & Expenditure Report of 31 December 2010: follow up briefing

Meeting report

Mr Bheki Maduna, Chief Financial Officer, Department of Labour, noted that the following figures represented were up to 31 March 2011. He said that Programme 4, which was Labour Policy and Labour Market Programmes (LP & LMP) would be changing in the next financial year to Labour Policy and Labour Industrial Relations Programme.  

[Ms P Nxawe,] Deputy Director General, Department of Labour, gave the presentation on the Department's Key Result Areas (KRAs) as per programme. These also included previous requests by Members on certain targets and objectives, including challenges experienced. The Strategic Plan 2010 to 2015 consisted of the following KRAs:
KRA 1: Contribution to Employment Creation
KRA 2: Promote Equity in the Labour Market
KRA 3: Protecting Vulnerable Workers
KRA 4: Strengthening Multilateral and Bilateral Relations
KRA 5: Strengthening Social Protection
KRA 6: Promoting Sound Labour Relations
KRA 7: Strengthening the Capacity of Labour Market Institutions
KRA 8: Monitoring the Impact of Legislation
KRA 9: Strengthening the Institutional Capacity of the Department

Ms Mxawe explained that most of the targets for the first year had been partially achieved. The focus was on many areas including strengthening the capacity of the Department as well as on areas of job creation. With regards to KRA 9 and focusing on programme one (Administration), the Department had not achieved to develop and implement its Service Delivery Improvement Programme (SDIP). The major challenge was that the SDIP would not be finalised in quarter four as funding could not be sourced from National Treasury; instead budgets cut had been instituted. The corrective measure was to fund the restructuring project within the allocations of the Department.

Other challenges with regards to KRA 9 were a lack of capacity and Integrated Client Base (ICT) system for planning, monitoring and evaluation reporting. Incomplete data and from transaction systems and delays in the development of other systems have contributed to this challenge. The corrective measure was that the State Information and Technology Agency (SITA) had provided support to the Department. Siemens’ capacity to deliver as per contract was another major challenge for the Department. The Department had requested the Klynveld Peat Marwick Goerdeler (KPMG) firm to do investigations into this and the KPMG report had been finalised and was awaiting adoption by the Department after which recommendations would be implemented.

With regards to programme 2, Inspection and Enforcement Services (IES), the Department was focused on attending to KRA 3. The Department had set out to reduce the prevalence of silicosis in the non-mining industry. The Department wanted to conduct a baseline study to determine the prevalence of silicosis in the non-mining industry, but this had not commenced as yet. The Department also wanted to conduct 10 000 blitz inspections targeting the sectors of wholesale and retail, hospitality, agriculture and forestry, iron and steel, and chemicals. This was achieved as 15 833 inspections were conducted and 49% compliance was achieved. The Department had also set out to inspect 200 000 workplaces for compliance to ensure 80% compliance to labour legislation. This was only partially achieved as a total of 144 086 inspections were completed. The challenge was that the Department could not meet the target for inspections due to the public service strike. Due to financial constraints, the activities of the roving team had to be trimmed down. The corrective measure was that the Department would catch up with the programme as the trained roving team members would impact technical expertise to other inspectors in the respective provinces.

Focusing on programme 3, Public Employment Services (PES), most programmes were partially not achieved or in progress. This programme focused on KRA 1. The challenge was that there was inadequate human and Information Technology (IT) resources for PES. Corrective measures included that a provincial strategy needed to be developed to deal with the inadequate human and IT resources. Programme 4 focused on the Labour Policy and Labour Market Programmes (LP & LMP), and KRA’s 1,2,3,4, and 6. The target of quarterly Ministerial briefing reports on labour market issues had been achieved. The Department also achieved having the Employment Equity Amendment Bill published for public comment. Major challenges were that the investigation of wage differentials could not be achieved as planned due to the unreliability of statistics. The Department planned to correct this by investigating raw data submitted to the Labour Market Information Systems of the Department for investigations and recommendations.

Mr Maduna presented the departmental expenditure as at 31 December 2010. This was based on the main division of the budget vote, number 17. The Department's adjusted budget for 2011/12 was R1.8 billion, the actual expenditure was R1.5 billion and the available budget was R315 million. He then went on to give a breakdown of current vacancies in the Department per province:
Eastern Cape – 631 positions, 79 vacant, total establishment 710
Free State – 414 positions, 26 vacant, total establishment 440
Gauteng – 1268 positions, 121 vacant, total establishment 1389
KwaZulu Natal – 922 positions, 26 vacant, total establishment 998
Limpopo – 408 positions, 24 vacant, total establishment 432
Mpumalanga – 417 positions, 44 vacant, total establishment 461
Northern Cape - 270 positions, 9 vacant, total establishment 279
North West - 372 positions,16 vacant, total establishment 387
Western Cape – 609 positions, 61 vacant, total establishment 670

Discussion
The Chairperson said that the Department needed to finalise its financial information so that the Committee could deliberate on the budget vote.

Mr Z Mlenzana (COPE, Eastern Cape) said that the presentation by the CFO, Mr Maduna, focused more on the expenditure of the Department than on the budget itself. He wanted more information on the finances going forward.

Mr Maduna replied that the Department had presented its budget and allocation per programme at a previous meeting. He would make the information available to Mr Mlenzana as requested.

Mr H Groenewald (DA, North West) asked what types of monitoring measures were in place within the Department to ensure that money is managed correctly. He said that there was a lot of corruption happening in provincial offices.

Mr Maduna replied that there were controls in place which focused on provincial financial policies and procedures. Within the provincial management, the Department provided support services. The Department also took the time to go down to each respective province for oversight visits. Risk management and internal audits were also carried out on a regular basis.

Mr M Jacobs (ANC, Free State) commented that at the previous meeting members asked the Department to present its plans with regards to job creation. This was not done in the current presentation. He wanted to know with regards to the challenges faced by the Department, how long have they been experiencing these challenges.

Ms Nxawe replied that the some challenges were experienced over a long period of time and others were recent. For example, the ICT contract was signed for ten years, and this has been problematic over a long period of time. Other challenges were recent and these were experienced as non delivery per project plan. The Department was working with another provider to take over the ten year contract, but due to penalties that could be imposed for cancelling the contract with Siemens, a strategy had to be developed and was yet to be finalised.

Mr Jacobs said that the presentation was sometimes hard to follow because of all the abbreviations used.

Ms Nxawe replied that this was noted and the Department would ensure that future presentations contained a glossary of terms.

Mr Groenewald said that he agreed with Mr Jacobs. He suggested that page two of the presentation should contain a list with the words used as abbreviations.

The Chairperson wanted to know what the corrective measures entailed with regards to employment screening.

Ms Nxawe explained that the Department was currently enhancing employment opportunities by having job seekers screened, registered and then matched to jobs. The Department also wanted to have more power to compel employers to report and register job opportunities on the system running in the Department. This also included vacancies in government departments.

Mr D Feldman (COPE, Gauteng) commented that the Department should not just present what was achieved and not achieved but rather show percentages and figures.

Mr Groenewald said that the filling of vacancies was not creating jobs; the Department was only presenting vacancies but not presenting new jobs that would be created.

The Chairperson asked what the Department was planning to protect vulnerable workers, such as those in the taxi industry.

Ms Nxawe responded that the Department had undertaken research a while ago to address the issue of taxi drivers, and this was ongoing. There had also been some progress in implementing the registration of taxi drivers into the Unemployment Insurance Fund.

The Chairperson requested that the Department should not give presentations in a “cut and paste” manner, which meant that they gave the same presentation to the Select and Portfolio Committees. She reiterated that this was the Select Committee and they were responsible for addressing pressing issues and challenges that the Department was facing.

The meeting was adjourned.