Department of Tourism 2012 Strategic Plan

Meeting report

National Department of Tourism (NDT) 2012 Strategic Plan

Opening Remarks by Director-General

Mr Kingsley Makhubela, Director-General, NDT, stated that he had attended a meeting in Geneva of the Air Transport Action Group (ATAG) which was made up of amongst others the CEOs of companies like Airbus, Boeing and Rolls Royce. Statistics on various aviation related issues were released at that meeting. These included the following:

•The aviation industry had generated $2.2 trillion and 56.6m jobs worldwide.

•There were 23 844 commercial aircraft in service worldwide- this figure was expected to double over the next 20 years.

•There were 1568 registered airline companies around the world.

•In 2011 passengers flew 5.1 trillion kilometres.

Mr Makhubela noted that the question relevant to the NDT was what South Africa’s share of all the given statistics was. In 2012 it was expected that 1billion tourists would be travelling around the world. The strategies of the NDT needed to be leveraged according to the aforementioned statistics. In 2010 the decision was taken to sort out the organisational structure of the NDT which was now complete. The NDT had come up with a two pronged approach- domestic and international. The new structure of the NDT had been approved by the Department of Public Service and Administration (DPSA) and National Treasury. There had been a decrease in domestic trips from 33m to 28m. It was concerning as domestic tourism was of vital importance given that the international market was unpredictable. South Africa’s home base needed to be strengthened. Across the three spheres of government, R3bn was spent on tourism. There was however a great deal of overlap. Better co-ordination was needed. The NDT took action to better improve co-ordination especially between provincial and local government.

On international matters the NDT did not wish to duplicate the work of SA Tourism. The NDT would focus on policy issues. It had to be kept in mind that the world today was very integrated. The focus could no longer be on individual countries. SA Tourism had to come up with a hub strategy. The question was how the country was going to leverage into opportunities.  Did South Africa have a strategy in relation to the United Nations World Tourism Organisation (UNWTO)? What was the country’s strategy at the World Travel and Tourism Council (WTTC)? Those questions and others informed what the NDT’s new organisational structure should be.

Mr Makhubela handed over to his deputy director generals to speak to the briefing document.

Presentation on 2012 National Department of Tourism Strategic Plan

Ms Nomzamo Bhengu, Chief Directorate: Governance Support, NDT, spoke to the legislative and policy mandate of the NDT. Tourism sector priorities were also highlighted. The NDT’s key priorities like job creation, domestic tourism, skills development and responsible tourism were outlined. Members were given insight into the review of the NDT Mandate, its vision, mission and values. The Committee was given an overview of the new NDT structure as well as a breakdown of its goals and organisational risks.

Programme 1: Chief Operations Officer

Mr Dirk van Schalkwyk, Chief Operations Officer, NDT, stated that the purpose of the Programme was to provide strategic leadership, centralised administration, and executive support and corporate services. The strategic outcome orientated goal was to achieve good corporate and cooperative governance. Under each of the Programme’s strategic objectives members were shown what performance indicators had been put in place, what the baseline was set at and what the medium term targets for 2012/13, 2013/14 and 2014/15 were. For example under the strategic objective of effective organisational performance and management system with the performance indicator being percentage compliance with provisions of government’s performance and risk management prescripts,  the base line had been set at 100%. The targets for the upcoming three financial years were set at 100% compliance per year.

Programme 2: Policy and Knowledge Services

Mr Victor Tharage Deputy Director General: Policy and Knowledge Services, NDT, stated that the purpose of the Programme was to support sector policy development and evaluation, research and knowledge management, promotion of transformation and responsible tourism. Under each of the Programme’s strategic outcome orientated goals  with its accompanying strategic objectives members were shown what performance indicators were put in place, what the baseline was set at and what the medium term targets for 2012/13, 2013/14 and 2014/15 were. For example with the strategic outcome orientated goal to improve the impact of tourism on the livelihood of all South Africans coupled  with the strategic objective of monitoring and evaluation of tourism sector performance, strategies and policies. Using the frequency of the state of tourism reports as a performance indicator; the base line used was the 2010 State of Tourism report. The targets for the upcoming three financial years were set at 1 report per year.

Programme 3: International Tourism

Ms Aneme Malan Deputy Director General: International Tourism, NDT, explained that the purpose of was to provide strategic political and policy direction for the development of South Africa’s potential throughout various regions of the world. Under each of the Programmes’s strategic outcome orientated goals with its accompanying strategic objectives Members were shown what performance indicators were put in place, what the baseline was set at and what the medium term targets for 2012/13, 2013/14 and 2014/15 were. For example with the strategic outcome orientated goal of increased contribution of the tourism sector to inclusive economic growth coupled with the strategic objective of being to provide international tourism market(country and/or region) analysis to inform strategic interventions. Using the   number of country profiles developed and updated per year as a performance indicator no baseline had been set but targets for the upcoming three financial years were set at 180 profiles year.

Programme 4: Domestic Tourism

Ms Morongoe Ramphele, Deputy Director-General: Domestic Tourism, NDT, noted that the purpose of the Programme was to provide political, policy and strategic direction for the development and growth of sustainable domestic tourism throughout SA. The strategic outcome orientated goal was to increase contribution to the tourism sector to inclusive economic growth. Under each of the Programme’s strategic objectives Members were shown what performance indicators were put in place, what the baseline was set at and what the medium term targets for 2012/13, 2013/14 and 2014/15 were. For example under the strategic objective to facilitate the implementation of appropriate support packages for regions with the performance indicator being the number of provincial profiles developed, no baseline had been set.

The targets for the upcoming three financial years were set at 9 profiles updated per year.

Vote 35: Estimates of National Expenditure

Mr Ralph Ackerman, Chief Financial Officer, NDT, gave the Committee a breakdown of the Department’s financials. The NDT had spent 98.8% of its budget. 1.2% of its budget had been underspent, 60% of which would be carried over to the next financial year. The Committee was given a breakdown per programme of the NDT’s budget for 2012/13, 2013/14 and 2014/15. The total budget for 2012/13 was R1.367 332m and the breakdown per programme was as follows: Administration- R 195 043m; Policy and Knowledge Services- R 787 994m; International Tourism- R46 834m and Domestic Tourism- R337 461m. Over the MTEF period there had a been an increase in the budget by 9.36% from R1.367 332m in 2012/2013 to R1.495 360m in 2013/14 and an increase by 5.6% from R1.495 360m to R1.580 091m in 2014/15. Members were given a further breakdown of figures within each programme.

Discussion

The Chairperson queried the NDT before Members engaged on the contents of the briefing. Had the NDT addressed the Auditor Generals concerns which had emanated from its Annual Report? What progress had been made with regards to the Convention Bureau. What did the Memorandum of Understanding between the NDT and the Department of Home Affairs entail? The Department of Science and Technology had a PHD Programme for post graduate studies, was the NDT involved in it given that it was collaborating with universities. Was the allegation that Parliament was using illegal tourism guides true? Was the use of graded establishments by government being monitored? If it was, what were the results?

The Chairperson further noted that international relations as covered in the briefing had not spoken about the Brazil, Russia, India, China and South Africa (BRICS) Agreement. The Chinese had alluded to the fact that they had a 5 year plan to encourage Chinese to travel abroad. Lastly, he asked why so many of the frontline staff of hotels were foreigners.

Mr Makhubela stated that the concerns raised by the Auditor General were minor issues. It related to the capturing of leave and how procurements had been processed. The NDT had factored the issues into its management meetings and these had been addressed. The Convention Bureau was established and operated within SA Tourism. The Convention Bureau would be operationalised during the current financial year. According to research done by the International Labour Organisation in 2010, 30% of hotel workers in South Africa were foreigners. The trend of using foreign staff was common worldwide.

He was not aware of the PHD Programme of the Department of Science and Technology. Departments were required to have their own agreements with universities as the NDT did.

On the issue of visas the NDT had agreed on a framework with the Department of Home Affairs. Issues of national security had to be balanced with economic benefits.

Mr van Schalkwyk addressed the question about the Auditor-General and stated that everything was fine in this regard. There were some implementation issues of social responsibility projects at grassroots level. Cabinet had encouraged government departments to use graded establishments. The policing part of this was part of the procurement process. He noted that the next step for the Auditor General was to audit departments. The NDT also had to play its role in supporting Small Medium Micro Enterprises (SMMEs).

Ms Ramphele stated that the NDT’s assessment had shown that the NDT was not supporting SMMEs enough. More work needed to be done.

Mr Tharage stated that the NDT was not aware of the use of illegal tourist guides by Parliament. More information on the issue was needed to properly look into the matter.

Ms Malan stated that the NDT had entered into meetings with the Ambassador of China so as to better understand the needs of Chinese tourists. The NDT trained tourist guides to speak Chinese. Continuous interaction with the Ambassador was taking place. The Department of International Relations and Co-operation had a new unit dealing with BRICS and SA Tourism had an office in China.

She noted that the NDT had a database of signed agreements. The NDT intended to service agreements.

The Chairperson stated that other government departments needed to be persuaded to use graded establishments. He was concerned that the Tourism Bill which would address the issue of the use of fake grading plaques had not been forthcoming.  

Mr Makhubela stated that he had met with the National Treasurer to make it a requirement that in order to do business, establishments needed to be graded.

Questions pertaining directly to the briefing followed.

Mr S Farrow (DA) pointed out that the strategic objectives of the NDT hinged on other agencies of government doing their part. Memorandums of Understanding (MOU) with other government agencies were good but what happened when these agencies did not do what they were supposed to. He felt it necessary that the Committee do oversight over these MOUs in order to check on whether other government agencies were doing what they were supposed to.

He asked what the other spheres of government were doing on marketing and branding.

Mention was also made of tourist operators and couriers. He noted that couriers specifically were covered in a bill which was governed by the Department of Transport and that the NDT should enquire about it as it impacted upon tourism. There was good progress made on the domestic side of things. However air travel and hotels in SA was far too expensive. Prices had skyrocketed during the 2010 FIFA World Cup and had remained so. It was an issue which needed to be addressed.

He was glad that the NDT had MOUs with universities on research and development. The Committee needed to have access to these MOUs as well. Another concern that he had was the excessive use of consultants by government departments. Why should research be done by consultants when departments could do it in-house? There were simple methods of compiling information. He had recently visited Australia and in that country the authorities had a form at the airport which needed to be filled out as to why a person visited Australia and whom they were visiting. Similar forms could be used at SA airports in order to compile information. 

Mr Farrow further asked that the Annual Report on International Collaboration be made available to the Committee for perusal. Lastly, he asked whether sustainability studies were conducted about rural enterprises.

Mr Makhubela stated that there was co-operation between government departments and stakeholders in the industry. An example of this was when he was given a tip that there was a jet fuel shortage at OR Tambo International Airport. He had contacted the Department of Transport and had met with various CEOs of oil companies to sort out the issue. The NDT also worked with the Departments of Home Affairs and Police on various issues.

Mr Tharage stated that the Domestic Tourism Strategy would address the issue of high prices.

Ms M Njobe (COPE) was glad that the NDT had taken the concerns raised by Members in the past into consideration as could be seen by the efforts on promoting domestic tourism. It was good that the NDT was working with universities as universities especially previously disadvantaged ones had complained that government departments did not use them. The NDT seemed to be addressing the quality of professionals coming from universities however she had concerns about the content of tourism studies in SA. Engagement with universities should not only be limited to research but also on education content. Participation from the Department of Education and the tourism industry was needed. A co-ordinated effort was needed. Co-operation between the national, provincial and local spheres of government on tourism was needed. Actual tourism was at provincial and municipal level. She suggested that provinces and municipalities should conduct research in order to identify where funds should be spent on tourism. This information was needed.

Ms Njobe pointed out that on a recent Committee visit to Mexico she encountered a tourist guide that was university trained in anthropology. Tourism guiding in SA should also be professionalised. The standards of tourist guides in SA should be raised. She referred to the briefing and stated that for profiles there were no baselines set. Could the work that had already been done by SA Tourism not be used as baselines? What were the universities that the NDT had MOUs with?

Mr Makhubela explained that the briefing spoke to the broader strategy regarding domestic tourism. Later on, strategies on domestic tourism would be rolled out in the provinces. The NDT had MOUs with the Universities of Zululand, Pretoria, Venda, Johannesburg and Cape Peninsula Technikon.

Ms Malan addressed the question on baselines for profiles and stated that SA Tourism did work on it but it had not been done broad enough. The NDT intended to do it more broadly and not only every 3 years as SA Tourism did.

Ms J Maluleke (ANC) asked for clarity on the professionalisation of tourist guides. Not much had been said about awareness. She also asked for more information on the dropouts in relation to learnerships. Referring to the Expanded Public Works Programme (EPWP) challenges faced by the NDT and asked if these challenges had been addressed. She asked why chef learnerships were only at big hotels in Johannesburg and not in other areas.

Mr Tharage stated that the awareness of the professionalisation of guides was part of the NDT’s strategy. 

Ms Ramphele stated that there were 800 chef learnerships and they were not only focused in Johannesburg. There were 93 dropouts which were for various reasons. Mpumalanga Province had the best performance.

The Chairperson agreed that the issue of consultants used by departments was an important one. Questions should be asked as to why consultants were needed and for how long. The vacancy rate of the NDT was 9% and the intention was to bring it down to 5%. A perfect situation would be for the vacancy rate to be 0%. He found it baffling that the vacancy rate was so high even though there were so many unemployed university graduates.

Mr Makhubela emphasised that the NDT was strict about the use of consultants. The numbers of consultants used by the NDT had decreased. On EPWP projects, certain compliance and security issues had arisen which necessitated the use of consultants for certification purposes.

He acknowledged that the vacancy rate was a problem. The public services acceptable figure was 12%. The NDT’s vacancy rate was 9% and hoped to bring this down to 5%.

Ms X Makasi (ANC) stated that the NDT had a target of 20 SMMEs to be supported. Progress thus far was that only 2 had been monitored. What were the challenges?

Due to time constraints all questions could not be responded to. The Chairperson requested the NDT to submit the remaining responses in writing to the Committee.

The meeting was adjourned.