Department of Communications on its Annual Report 2010/11

NCOP Public Enterprises and Communication

18 October 2011
Chairperson: Ms M Themba (ANC, Mpumalanga)
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Meeting Summary

The Department of Communications briefed the Committee on its Annual Report 2010/11. In the first part of the briefing, Members were given a breakdown of its flagship programmes: Digital Terrestrial Television, Job Creation, ICT Rural Development, Broadband, Postbank and E-Skills. The second part of the briefing entailed a spreadsheet breakdown of the key achievements of the various branches of the DoC for 2010/11. The spreadsheet set out the targets, achievements, the status on the targets and reasons for any variance. Lastly the Committee was provided with a breakdown of the DoC’s budget versus its actual expenditure for the 2010/11 financial year. In total the DoC had spent 66.7% of its funds.

The Committee had a robust interaction with the DoC. Concerns were raised that perhaps not much implementation was taking place. The Chairperson felt that the DoC was dragging its feet. The filling of vacant posts and under spending by the DoC was concerning even though plausible explanations were given. The DoC was critisised as lacking continuity in its planning. Members were particularly interested in job creation - for which the DoC could not give actual figures.

Meeting report

Annual Report of the Department of Communications (DoC) for 2010/11
The Department of Communications delegation comprised of Ms Rosey Sekese, Director-General; Mr Gift Buthelezi, Deputy Director General: ICT International Affairs and Trade; Mr Sam Vilakazi, Acting Deputy Director General: Finance and ICT Enterprise Development; Mr Norman Munzhelele, Acting Deputy Director General: ICT Policy Development; Mr Themba Phiri, Acting Deputy Director General: Presidential National Commission; Mr Harold Wesso, Deputy Director General: e-Skills Institute; Mr Linden Petzer, Chief Director: Radio and Satellite Communication; Mr Farhad Osman, Chief Director: Strategic Planning and Monitoring, Ms Pearl Seopela, Chief Director: Communications; Ms Kedibone Sekwele, Chief Director: Human Resource Management and Ms Petronella Linders, Chief Director: Gender, Disability, Youth and Children.

Ms Sekese noted that the briefing would try to address issues raised previously by the Committee. At the outset, Members were given the context within which the DoC functioned. For instance governance structures with the DoC were not fully functional to enable decision-making on key projects. Ms Sekese gave a breakdown of the flagship programmes of the DoC:

Digital Terrestrial Television (DTT) – It sought to move SA from an analogue to a digital broadcasting platform through the preferred DVB-T2 standard.
Job Creation – To establish an Information and Communication Technology (ICT) Industry Wide Working Group on job creation whose purpose would be to facilitate the identification of priority areas for job creation.
ICT Rural Development – The ICT Rural Development Strategy would be implemented through various key projects as ICTs were seen as an effective enabler to rural development.
Broadband – To improve broadband penetration through the implementation of an Integrated Broadband Plan that would facilitate capital investment, innovation and rural access. Plans for connecting schools, health and government centres would not only improve service delivery, but also improve the uptake and usage of broadband by government and individuals.
Postbank – The Post Bank Bill had been signed into an Act late in 2010. Work would begin to fast-track the rollout of the Post Bank centres or outlets throughout the country.
E-Skills – Through the e-Skills Institute, to massify the e-skilling of our nation for a rightful place in the Information Society and Knowledge-based Economy, ensuring (i) that citizens improve their quality of life through the use of ICTs, and (ii) that employment ready students were delivered.

The second part of the briefing entailed a spreadsheet breakdown of the key achievements of the various branches of the DoC for 2010/11. The spreadsheet set out targets; achievements; the status on whether targets had been achieved, partially achieved or not achieved; reasons for variance where applicable and lastly what the current status was.

ICT Policy Development Branch
Mr Munzhelele and Mr Wesso spoke to key achievements. For example there had been a target of reducing telecommunication costs by 15%. The DoC had developed a programme of action to reduce the cost to communicate which was submitted to Cabinet for noting. An e-Skills Programme had also been developed.

ICT Infrastructure Development Branch
Mr Petzer noted that the target was to have National Broadband legislation submitted to Cabinet. The National Broadband legislation document was completed and would be incorporated as a section/chapter into the Electronic Communications Act (ECA) Amendment Bill. At present the broadband legislation had been incorporated into the ECA Amendment Bill and was still to be published for public input.

Presidential National Commission on Information Society and Development
Mr Phiri stated that an ICT Rural Development Strategy had been developed and that consultations with the Department of Rural Development and Land Affairs were conducted to discuss the establishment of an implementation forum. Stakeholder input on the Strategy and Implementation Plan was received in March 2011. The Implementation Plan was currently being finalised. The DoC together with the Universal Service and Access Agency of SA (USAASA), the SABC and the National Electronic Media Institute of SA (NEMISA) had begun implementing certain areas of the ICT Rural Development Strategy.

International Affairs and Trade Branch 
Mr Buthelezi stated that a target had been set for international training and development opportunities secured through bilateral co-operation with India, Cuba, South Korea and China. One of the achievements was that the DoC had secured a commitment from the Korean authorities to formalise customised interventions in human capital development.

ICT Enterprise Development Branch
Mr Vilakazi noted that a target had been set for 25 ICT business linkages to be facilitated. In an effort to facilitate the development of small enterprises to enter and compete in the export markets, the DoC appointed a service provider to develop a step by step guide which outlined the requirements of participating in export markets. Progress was hampered to a certain extent by delays in the procurement process but the project was nevertheless being implemented.

Governance and Administration Branch
Mr Osman stated that the DoC had a target of 50% for gender representativity at Senior Management Service (SMS) level. The employment equity plan of the DoC was approved and implemented. At the end of the year under review, DoC had achieved 37.4% gender representativity at SMS level. The organisational review process however affected recruitment. At present gender representativity had moved up slightly to 39.08%. On disabled persons the DoC had to meet its target of 2%. Actual representation of disabled persons in the DoC was 2.8%.

Mr Vilakzi provided the Committee with a breakdown of the DoC’s budget versus its actual performance for the 2010/11 financial year. In total the DoC had spent 66.7% of its funds. Its final total appropriation was R2, 138,001m and its total actual expenditure was R1,426,477m. It had under spent R 711,524m.

Mr H Groenewald (DA, North West) stated that it looked as if things were happening in the DoC. He was however concerned about what had happened on the Board of the SABC. He asked if the DoC had an asset register in place and if so was it regularly updated. If it was not updated what were the reasons for it not being updated. Could the DoC indicate the value of assets in the Department, those that were stolen, lost or destroyed for the year? He also asked what mechanisms had the DoC put in place to uplift the morale of staff. What was the success rate of collection of TV licence fees? Was it captured on a database? The DoC in the briefing stated that it was to prioritise areas for ICT Rural Development. How was the DoC intending to reach its priorities? He asked who was to pay for the connections to households. What kind of subsidy did the DoC receive from Parliament? What were low power broadcast stations? He was concerned about foreigners coming to SA to train locals and then not leaving once the training was completed.

Mr Vilakazi confirmed that the DoC did in fact have an asset register. The asset register was updated regularly. The DoC acquired R5m to R6m worth of assets annually. The assets were tagged and could be traced.

Ms Sekese stated that the key need of staff in the DoC was for staff to be kept busy with work that needed to be done. Staff should also be kept abreast of what was happening in the DoC and what was expected of them. In the main, the DoC tried to ensure that governance structures were functioning. It was important that when recruitment took place, internal staff should also be given the opportunity to be promoted by applying for vacant posts.

Mr Buthelezi responded that the issue of foreigners who did not leave after providing training to locals was a widespread problem. At departmental level there was little which the DoC could do. It was a tricky situation.

Mr Themba stated that for rural development, a framework was needed in order to control how money was spent. The spending of state owned enterprises needed to be realigned with this.

Mr Petzer responded that low power broadcast stations were used in areas where there was no coverage. The power stations were located in a specific village or town and provided 3 SABC channels and a FM service. He agreed to furnish the Committee with a full list of the 300 areas covered, by the end of the week.

Mr M Jacobs (ANC, Free State) was concerned that everything was forever in the planning stage. What about implementation? The briefing information had not set target dates and the percentage of performance was not stated. Another concern was the vacant posts in the DoC. Under spending by the DoC was also concerning. Why were funds being returned to National Treasury? The matter of tenders also needed to be clarified by the DoC. He noted that the main issue was about job creation. Only planning was taking place, there were no specifics. The Committee needed to know how many jobs were created.

Mr Themba agreed that job creation was a priority of 2011. He noted that a great deal of work had been done in the ICT sector to think about the issue. Industry could play a huge role.

Mr Vilakazi explained that the under spending by the DoC was due to the fact that certain funds were ring fenced. The DoC had asked National Treasury to roll over funds that had not been spent. The approval process of tenders was prolonged. The issue was addressed in August and September 2011.

Mr Z Mlenzana (COPE, Eastern Cape) noted that he wanted specifics on the gender balance of the DoC at decision making level. What progress was being made on employment equity? Thirty seven percent was a far cry from the required fifty percent. He asked how far the implementation of the service delivery improvement plan was. The DoC had in its briefing made the point that the India, Brazil and SA (IBSA) dialogue forum had not been able to meet to ratify processes. What was the problem?

Ms Sekwele stated that with regards to employment equity there was an employment equity forum. There was an employment equity plan that was currently under review. Targets had been set which had to be met. The DoC during recruitment monitored adherence to the employment equity plan. She conceded that the DoC did not have a service delivery improvement plan. The Department of Public Service and Administration (DPSA) had been approached by the DoC to assist with a service delivery improvement plan. The challenge for the DoC was that it did not deal directly with the public. The DoC was in consultation with state owned entities to work on a service delivery improvement plan.

Mr Buthelezi explained that a trilateral arrangement was much more difficult than multilaterals. Multilaterals were easier. With a trilateral if one partner does not show up then it becomes a bilateral and the agreement was not binding on the absent partner. Efforts were being made to make the trilateral work.

Mr Mlenzana asked if the DoC had a dedicated office handling the service delivery improvement plan.

Ms Sekwele responded that the DoC did not have a dedicated office but that the function was located within Human Resources.

The Chairperson asked what the role of the DoC was in community radio and TV. How much funding had been set aside for it and what service providers had been sourced? What was the impact value of community radio stations and TV? She asked whether the DoC complied with the Inter Governmental Relations (IGR) Act and whether the DoC consulted with local government on information and communication technology (ICT). The DoC offered e-skills at universities, how many students had graduated? She stated that training of women took place in Johannesburg, how would the DoC ensure that the training of women took place in other provinces as well. Women development was just as important as youth development. She asked what had happened to the 112 call centres that had been in Cape Town. Did the call centres have any impact? How did the DoC collect TV licences in the most remote rural areas where there were hardly TV signals? She pointed out that the South African Broadcasting Corporation (SABC) had requested an increase in funding from the DoC. What were the DoC’s plans about that?
She asked if the DoC had implemented the recommendations made by the auditing firm PriceWaterhouseCoopers (PWC). The filling of posts was another concern as the DoC had persons being appointed in an acting capacity. She asked for elaboration on public participation programmes of the DoC.

Ms Linders stated that the DoC had specific target audiences for youth. Within youth, provision was made for 60% women. It also catered for disabled women. The DoC had a co-ordinated strategy the focus of which was on youth, disability and equity. This was the approach followed for youth development. Provincial participation was also welcomed.

Mr Wesso responded that there was no e-skills university as yet. In 2008 a model had been developed, benchmarking had been done and at present it was at the incubating stage. It was anticipated that by 2013 there would be an e-skills institute. The DoC had already developed courses to be offered. In pilot projects 2 000 students had already enrolled. The DoC was at present partnering with Further Education and Training (FET) Colleges in the provinces. Over the last three years, the DoC had had ICT career summits. By June 2012, courses on offer at the institute would be advertised.

Mr Themba stated that the DoC had set aside funding for the employment of people in community radio stations. He added that there were other programmes as well.

The Chairperson requested a report on what Mr Themba had spoken about.

Mr Themba agreed to furnish a report by the end of November 2011.

In terms of compliance with the IGR Act he stated that the last meeting was held in September 2010. It was held in the Free State and was attended by MECs. There was also an engagement model whereby the DoC engaged with municipalities. In March 2007 there had been an ICT municipal forum held in Durban. At the meeting one of the issues discussed was broadband. With regards to the training of women that had taken place in Johannesburg, the fact of the matter was that women had come from all provinces. The DoC was aware that it could do more on the issue.

Ms Sekwele, referring to the implementation of PWC recommendations, stated that the DoC was sitting at the level of an approved structure by the DPSA and the Minister. There was movement towards a new structure. She noted that the filling of critical posts would not be affected by the migration. Critical posts could not be filled because of institutional review and realignment.

The Chairperson felt that the DoC was dragging its feet.

Mr Jacobs noted that there was no sense of urgency for the DoC to fill posts. Implementation was also not taking place.

The Chairperson wanted the DoC to be serious.

Ms Sekese responded that there was a sense of urgency to fill vacant posts. The concerns of Members were heeded. The DoC had been going through an organisational review hence posts could not be filled. In the last two to three weeks, the DoC had advertised posts. By the end of the financial year the DoC would have its top tier of posts filled. The DoC had had to put recruitment on hold due to the institutional review taking place. She agreed that all acting positions should be filled.

Mr Vilakazi acknowledged that indeed the SABC had requested additional funding for capital and operational expenditure. There was a likelihood that National Treasury might grant increases on certain things.

Mr Petzer noted that the 112 emergency call centre was a pilot project. A decision had initially been taken to cancel it but later it was decided that it should continue. Attempts were being made to get it up and running.

Mr Vilakazi noted that the budget for the 112 call centre was R111m but the funds had not been spent.

Ms Seopela stated that the DoC had public participation programmes. The numbers varied as the Ministerial leadership had changed.

Mr Mlenzana wished to have specifics on public participation programmes in the provinces and in municipalities.

Ms Seopela stated that she did not have all the information at hand but that she had some.

The Chairperson asked by when could all the information be provided to the Committee.

Mr Mlenzana suggested that Ms Seopela compile a report and provide it to the Committee.

Mr Mlenzana asked whether the total expenditure of the SABC could be checked on. He asked what the percentage contribution by the DoC towards the SABC was.

Mr Vilakazi stated that the SABC did not receive much funding from the DoC. For 2010/11 the SABC had received R230m for education and R38m for Channel Africa. The percentage contribution by the DoC to SABC was not more than 5%. The rest of SABC’s funding came from advertising and other sources.

Mr Munzhelele said that there were stations being assisted by the DoC. The list of stations would be forwarded to the Committee. The assistance was however only for community radio stations and not for community TV stations. During the current financial year, DoC was assisting 15 community radio stations.

The Chairperson stated that the National Council of Provinces (NCOP) worked directly with provinces. The Committee had provincial interests at heart. She felt that the Committee was overlooked and did not get invited to DoC initiatives that were happening in the provinces.

Mr Groenewald reiterated his earlier concern that foreigners who train South Africans, did not leave the country once the training was completed. He felt that these foreigners were taking jobs away from locals. The problem was occurring in his province the North West, specifically in Rustenburg. He asked by what means would broadband be provided in rural areas - by cable or satellite?

Mr Petzer replied that ideally it would be by cable or fibre. However a hybrid model would be followed. The core would be fibre and the access to the home would be by radio base technology. The disadvantage of radio was that it did not have the same bandwidth as fibre but for household use it was not a major issue.

Mr Mlenzana said the Departments of International Relations and Home Affairs should deal with the issue.

The Chairperson stated that Mr Groenewald should raise the issue with the relevant Ministers. She noted that Members should put the rest of their questions in writing and forward it to the DoC as time had run out.

Mr Jacobs was concerned that the DoC did not have long term planning. When new persons filled posts, new plans came in with them. There was no synergy which made implementation difficult.

Ms Sekese conceded that continuity was a problem in government as a whole not only in the DoC.

The Chairperson thanked the DoC for the briefing and adjourned the meeting.


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