Department of Tourism on its Budget Vote 2011/12 & Strategic Plan

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Meeting Summary

The Department of Tourism briefed the Committee on its strategic plan and budget for 2011/12, which indicated some of the challenges that this Department faced, and was tackling. The Department indicated that it had a focus on job-creation, rural development, and 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, but it would be looking to improve this still further where changes were necessary, including better governance around its social responsibility initiatives. It would also be leveraging numerous international events which would allow better exposure, and would be looking at best practices internationally in other countries. Key focus areas for the 2011/12 financial year were the leveraging of the positive impacts achieved by the 2010 Soccer World Cup, with marketing strategies linked to wildlife, adventure, hospitality and welcoming people. A new grading system had been introduced and the Department was continuing to assess the establishments on its database. It had also established an internal audit unit. It was attempting to fill posts to address its vacancy rate of 8%.

Members asked for clarity on chefs’ training schools, and asked that another presentation should be given on the international tourism budget in due course. Members asked who was in charge of the projects at Gariep Dam, and the new conference centre apparently planned for Kimberley, and suggested that Nelson Mandela’s house in Soweto ought to be marketed as a tourist attraction point. Members asked for a breakdown also of funding of the Expanded Public Works Programmes (EPWP) at the local level, asked why there was such a small increase in black economic empowerment projects, at only 1%, and why no funds had been allocated to research. Members asked where the 5 000 jobs would be created. Members noted that there were still problems around municipal and provincial handling of some projects, including the fact that not all projects applied exactly the same rules to parks under their control, so that different rules applied in different sections of the Kruger National Park, and the Department asked for assistance in having this rectified. Members suggested that the branding strategy needed to be revisited, and that other initiatives for attracting domestic tourists could include regulation of airline rates and tariffs of accommodation establishments, which were too high for many local visitors.

Meeting report

Department of Tourism Strategic Plan and budget 2011/12
Mr Kingsley Makhubela, Director-General, Department of Tourism, said that the Department, during this presentation, would be focusing on its challenges, particularly the external challenges over which the Department had little control.

Ms Nomzamo Bhengu, Chief Director: Tourism Development, Department of Tourism, informed the Committee that the Department of Tourism (DOT or the Department) would be focusing on 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, both by increased resources being directed to this sector, and by looking to improving the coordination of all levels of Government. 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, which had already received buy-in from the private sector.

She added that in the forthcoming financial year the Department of Tourism would also be launching the National Events and Convention Bureau, which aimed to attract people to host business conferences and seminars locally.

Although the Department’s management capabilities were good, it would be further improving the efficacy of those systems that still needed improving, such as better governance around social responsibility initiatives. The Department would also be looking at its organisational structure, with a view towards ascertaining whether this structure did allow the best opportunity for the Department to fulfill its mandate. It would also be leveraging numerous international events that would allow it better exposure, as well as the opportunity to discover the international best practices of other countries that had successful tourism sectors.

Mr Ralph Ackermann, Chief Financial Officer, Department of 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 Soccer World Cup. Domestic tourism was a key factor in ensuring the growth of the South African tourism industry and, in view of the decline in figures in this sector, it was something that 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 the Department would be rolling out the second phase of its ‘Experience it in 20 Days’ campaign.

He further noted that the key focus areas for the 2011/12 financial year were the leveraging of the positive impacts achieved by 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 the Department 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.

Discussion
Mr A Lees (DA, KwaZulu-Natal) thanked the Department for the excellent presentation. He wanted clarity as to whether a former Country Club, which had been turned into a chefs’ training school, was part of the Department of Tourism. He observed that international tourism was not mentioned on the Department’s Strategic Plan, and therefore asked that the Department should return to the Committee and make a separate presentation on the Department’s international tourism budget.

Mr Trevor Bloem, Chief Director: Communications, Department of Tourism, explained that were few chefs’ schools and the Department was looking at the accredited chefs’ schools, such as the one in Graaff Reinet, to market and support them. He also mentioned that there was another chefs’ school in Kimberley.

Mr K Sinclair (COPE, Northern Cape) wanted clarity on the rumours that the Department was building a conference centre in Kimberley. He wanted to know if the Department could not make more effective use of Public Private Partnerships (PPPs) to promote tourism. He also asked the Department to explain why the project next to Gariep Dam was discontinued.

Mr Bloem noted that the conference centre in Kimberley was a project of the Department of Public Works. He informed the Committee that the project near Gariep Dam fell under the Department of Environmental Affairs.

The Chairperson suggested that historical places like Nelson Mandela’s house in Soweto had to be marketed as tourist attraction points.

The Chairperson asked for a breakdown of the funding of the Expanded Public Works Programmes (EPWP) at the local level. He also wanted to know why the Black Economic Empowerment (BEE) projects increased by 1%, and why there were no funds allocated for the Department’s research department. Lastly, the Chairperson asked the Department to explain how it intended to create 5 000 jobs.

Mr Makhubela explained that people at the local level tended to believe that they had the mandate to proceed on their own, without informing the Provincial or National level, and this had led to EPWP projects at that level failing. He also mentioned that the Constitution placed matters of foreign policy under the responsibility of National government, which meant that small companies should not market themselves on the overseas market without the knowledge of the National departments. He asked the Committee for its assistance on other difficulties, such as the fact that provinces needed to impose the same rules in respect of their tourist points. He pointed out that Kruger National Park spanned two provinces and that different rules currently applied in different sections of the park. He further informed the Committee that although the Department had set up structures in all provinces to look at the maintenance of the EPWP projects, the Department was facing major challenges on these projects from being pressurised by politicians who wanted to be given money by the Department to run the projects themselves.

Mr Bloem responded on the question of the BEE projects, by explaining that the Department had already reached its target on BEE, so that the increase in that did not need to be more.

Ms Lerato Matlakala, Acting Deputy Director General: Tourism Development, Department of Tourism, explained that the 5 000 jobs would be created by the projects that the Department had already.

The Chairperson suggested that the Department had to revisit its branding strategy, so that it appealed both to South African domestic tourists and that it could also could market overseas. He also mentioned that in his opinion it was better for the Department to buy property, rather than to rent.

Mr Sinclair told the Department that he believed it should be very proactive and regulate the airline rates to boost domestic tourism.

Mr F Adams (ANC, Western Cape) mentioned that domestic tourism had taken a huge drop, especially in the townships, and he suggested that the Department also had to regulate the tariffs of bed’n’breakfasts and hotels, as they were too expensive for ordinary South Africans.

Mr Makhubela explained to the Committee that there was no legal framework compelling building owners and property owners to cater for people with disabilities nor to charge the same rates. He also informed the Members that because of the Soccer World Cup exposure, South Africa had gained the opportunity to host the International Stock Exchange conference in October 2011.

The Chairperson reminded Members of the Indaba in Durban between 6 and 10 May 2011.

The meeting was adjourned.

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