Minister in the Presidency & Statistics South Africa Strategic Plan 2013, Director for Parliamentary Budget Office appointment

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Finance Standing Committee

06 May 2013
Chairperson: Mr T Mufumadi (ANC)
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Meeting Summary

The Committee was given a short briefing by the Minister in the Office of the Presidency, Trevor Manuel, followed by a briefing by Statistics South Africa (Stats SA) on its work programme and strategic plan for the 2013/14 financial year.

Minister Manuel said that one of the frustrations of overseeing the work done by Stats SA was that in spite of the best that was done, there was hardly general public understanding of the work of the organisation. One of the big battles was to ensure that society understood the difference between the value of the proper output generated from the census and other information available in the public domain. There was a lot of information available to the public and government institutions which could go a long way in enhancing the achievement of the objectives set in the National Development Plan. However, it was unfortunate that this information was not being used and that was a big problem.

Stats SA reported that the census was conducted in 2011, which was adjudged successful, but it was noted that it had received a qualified audit opinion for 2012. The organisation’s overarching goal during the period 2010 to 2014 was the expansion of the statistical information base by increasing the supply and use of official statistics to inform evidence based decisions. The Committee was told that the key deliverables of the organisation’s strategy included broadening the role and reach of official statistics; growth through coordination, enhanced quality, sustained capacity and doing more with capacity. The Committee was also presented with the strategy implementation phases showing the phase, the year of implementation, strategic focus and the enablers. Stats SA was aligning its statistical themes for statistical production to the objectives of the National Development Plan.

The organisation faced the challenge of constraints in funding which could greatly compromise the quality of data and results released by Stats SA. This had an impact on decision making, policy formation and national planning. Due to the reverse gains in establishing statistical infrastructure, the national footprint of the statistical infrastructure could not be sustained. This could impact on the household survey programme, the Consumer Price Index basket and Gross Domestic Product benchmarking. 

Stats SA told the Committee that it planned to communicate better with the South African population in 2013/14. It had created a free application available on iPads, mobile devices and computers which granted instant access by the public to Stats SA content, data and reports.

Members asked for clarity on the controversial issues raised by a former Deputy Director General of Stats SA, which had questioned the quality of the 2011 Census results. Both the Minister and the Statistician-General assured the Committee of the high quality of results. The Committee also asked questions about budget allocations and decreases, vacancies and human resource challenges, the use of consultants and the plans to encourage municipalities to take a more active role in the use of statistics for planning and governance. The Committee asked for an assurance that Stats SA would not receive another qualified audit and what plans it had put in place to avoid this. A DA Member asked the Minister to explain why the government was still using the narrow definition of unemployment instead of the broad and all-inclusive definition and also asked for clarity on the comments about the Youth Wage Subsidy. The Committee urged Stats SA to take a more pro-active and coordinating role in matters related to statistics in the country, and made some suggestions for amendments of the Statistics Act should be amended to give Stats SA broader powers and roles in the execution of its mandate and duties.

 


 

Meeting report

Introduction by the Chairperson

The Chairperson welcomed Members of the Committee, Minister Trevor Manuel, who was in charge of the National Planning Commission. The presence of Mr Pali Lehohla, South Africa’s Statistician General and the delegation from Statistics South Africa (Stats SA) was also acknowledged. The Chairperson said that the Committee was sitting at a very challenging moment as there were many activities in Parliament which required the attention and presence of members. However, it was important for the meeting to proceed.  

Overview by the Minister in the Presidency in Charge of the National Planning Commission

Minister Manuel thanked the Committee for the opportunity to give an opening remark to the presentation by Stats SA. He said that in the context of the budget debates, many departments made big announcements. The discussion of the day and the presentation by Stats SA was going to have a different approach as the intention was to place before Parliament the discussion whether the strategy in the strategic plan worked and whether there was likely to be continuity between the strategic plan and the detailed work plan. It was also important to establish whether the plans were adequate.

One of the highpoints of the current administration was Census 2011 so it was important to look back and establish whether the objectives set for the Census 2011 were met and whether the resources provided for it were adequate. The focus last year was mostly on preparing for the publication of the census results but it was now time to look at the quality of the work done and the output generated. The next big question was whether the resources were adequately used and what was going to be presented to the Committee was the amount of detail available to every person who had an interest in the output of Stats SA. Part of the message of the day was that the census was very important but more important was the other products which came off the platform of the census.

Minister Manuel said that one of the frustrations of overseeing the work done by Stats SA was that in spite of the best that was done, there was hardly general public understanding of the work of the organisation. One of the big battles was to ensure that society understood the difference between the value of the proper output generated from the census and other information available in the public domain. There was a lot of information available to the public and government institutions which could go a long way in enhancing the achievement of the objectives set in the National Development Plan. However, it was unfortunate that this information was not being used and that was a big problem.

What the Committee needed to ask Stats SA was whether the resources were adequate and whether the outputs were satisfactory. It was also important to ask if Stats SA had been able bridge the gap between the information which was only available in big textbooks and general and popularly accessible information. The questions also had to be around whether the strategy and work plan were adequate and if issues were adequately communicated. The greatest disservice which Parliament and government could do to an organisation like Stats SA was to look at it as a single year project.

Minister Manuel thanked the Committee for their continuous interest in Stats SA and in supporting the sustainability of the work which was being done by the organisation.

Briefing by Stats SA
Mr Pali Lehohla, the Statistician General, Stats SA, started his presentation by quoting the National Development Plan, which said that “the future is ours, we must make it work”. He said that statistics fulfilled a vital role in decision making, with important aspects such as the system of planning, the system of monitoring and evaluation and the system of statistics. Statistics South Africa (Stats SA) had the statutory mandate to produce official statistics and coordinate the production of official and other statistics within the South African National Statistics System (SANSS).

Stats SA’s overarching goal during the period 2010 to 2014 was the expanding of the statistical information base by increasing the supply and use of official statistics to inform evidence based decisions. Mr Lehohla said that the key deliverables of the organisation’s strategy included broadening the role and reach of official statistics; growth through coordination, enhanced quality, sustained capacity and doing more with it.

Mr Lehohla presented to the Committee the strategy implementation phases, tabled showing the phase, the year of implementation, strategic focus and the enablers. Stats SA was aligning its statistical themes for statistical production to the objectives of the National Development Plan (NDP).

2013/14 Work Programme
The statistical for 2013/14 ranged from economic growth, through prices, sustainable resources management, employment, job creation and decent work to education. Stats SA also planned to extend its themes to the areas of life circumstances, service delivery, poverty, rural development, food security, land reform, population dynamics, safety and security and health.

The implementation plans generally consisted of the publishing of monthly, quarterly annual and periodic industry reports and statistics.

Mr Lehohla said that besides building and expanding the SANSS, the key strategic priorities of the Work Programme were going to be expanding the statistical information base, enhancing public confidence and trust, and improving productivity and service delivery. The plan also focused on importantly on accelerating the implementation of SANNS, investing in learning and growth, and participating in international statistical development.

Risks and Constraints
There were funding constraints on the implementation of the strategy. Mr Lehohla said that the implementation of statistical standards was constrained and the quality of macro-economic and social indicators was going to deteriorate over time.

The non-implementation of SNA2008 and ISIC4 international standards affected statistical information on economic growth, price stability and employment. If the current status continued, statistics were going to become inaccurate and irrelevant. This was going to impact on international trade, competitiveness, economic growth and policy development.

Mr Lehohla said that the funding constraint hampered the implementation of statistical coordination as provided for by Section 14 of the Statistics Act. This meant that state planning, monitoring and decision making would continue to be based on poor statistical information.

Due to the reverse gains in establishing statistical infrastructure, the national footprint of the statistical infrastructure could not be sustained. This could impact on the household survey programme, the Consumer Price Index (CPI) basket and Gross Domestic Product (GDP) benchmarking. 

2013/14 Communication Priorities
Mr Lehohla said that Stats SA aimed to connect with the South African population and publicise its statistics and results using desktop and mobile technologies, interactive maps and graphs, the power of place, data stories and the “My Ward, My Councillor” project.

Mr Lehohla told the Committee that an interactive Stats SA application had been developed which could be used on an iPad, mobile device or computer, which could be used to access all the data, projects and publications released by the organisation. The app was particularly helpful to municipalities, municipal managers and citizens who could trace any ward in the country, identify the councilor and get other statistics relating to gender, employment, the economy, poverty levels, infrastructure and population.

Discussion
The Chairperson said that the presentation was very clear, straightforward and elaborate.

Mr N Koornhof (COPE) said that he understood that Stats SA was the Secretariat for the Millennium Development Goals (MDGs). He wanted to know the role of the Secretariat, and how Stats SA operated in this regard. He also asked for information on the governing legislation.

Mr Lehohla said that Stats SA was still the secretariat for the MDGs. The role of Stats SA was to provide evidence and quantitative data as to the progress of the MDGs. The assessment of the credibility of the MDGs also had to be done by Stats SA.

Mr T Harris (DA) said that he had the Stats SA app on his iPad, commenting that it was very good and the innovation was welcomed.

Minister Manuel said that the Stats SA app content was currently being improved. All recent releases by Stats SA were now available on the app. It made for interesting reading by format and it provided for archives and historical issues.

Mr Lehohla added that The Apple App Store had the Stats SA app. This could be downloaded from the internet for free. 

Mr Harris told the Minister that a journalist had recently reported that unemployment in South Africa could be as high as 40%. He acknowledged that this was partially attributable to “sloppy reporting” but the journalist was looking at unemployment from its broad definition. He said that, given the trend of events, the expanded definition of unemployment was presently a more accurate one in South Africa.

Mr D Ross (DA) said, in relation to the definition of unemployment, that there was a need to bear in mind pricing on a monthly basis and the provisions of the Public Finance Management Act (PFMA).  

The Minister cautioned that the definition of unemployment had to be taken carefully. Following the trends by provinces, there were perceptions about access to employment. The International Labour Organisation (ILO) had not been able to resolve the issue that legislation methodology varied from country to country. In South Africa, it was a definition of exclusion. A series of amendments to labour laws which were currently in Parliament were going to help in this regard. He said that enlarging unemployment numbers was not very helpful.

Mr Harris noted, to Mr Lehohla, that there were serious allegations around the 2011 census, relating to the discord between the Statistician General (SG) and the former Deputy Director General, Dr Jairo Arrow. He asked if this could have impacted on the quality of the census results, and thought it important for the SG and Stats SA to give more clarity to the public on this issue.

Ms Ross asked about the plans being made for the next census, including any plans to correct the past errors.

The Minister commented, in relation to the quality of the 2011 census, he said that it was a “challenge to try to be more catholic than the Pope”. He wanted to assure the Committee that everything was being handled correctly in relation to the quality of the census. The issues with senior management were being handled and it did not compromise the quality of the data and census results. He said that Dr Arrow was already at the end of his term with the organisation, as he was due to retire in February 2013.

Mr Lehohla added that Stats SA had to take disciplinary action against the former Deputy Director. The evidence was clear. However, he assured the Committee that the sanctioning of a senior manager did not compromise the quality of census results, and he also stressed that the organisation was professional and resilient.

Minister Manuel said that he was interested in this matter because the integrity of the institution was at stake. The Statistics Council intervened in the census process and brought in international experts, who reported on the matter, and this assured the quality of the census results. He said again that Dr Arrow was in any event about to retire.

Mr Harris noted that, when releasing the Stats SA report on unemployment, the SG spoke in favour of the Youth Wage Subsidy. He asked if Stats SA had any data which was in favour of the Youth Wage Subsidy, and, if so, suggested that it should release it to assist with debate around the subsidy.

Mr Lehohla said that the Youth Wage Subsidy was going to have a better outcome and improve the current numbers on unemployment.

Mr Harris wanted to know when the business register was going to be done, especially as the SG had admitted that the work was going too slowly.

Minister Manuel explained that the business register was a tripartite effort that involved the South African Revenue Services (SARS), the Companies and Intellectual Property Commission (CIPC) and the Department of Trade and Industry (dti). Part of the delay was due to internal challenges in the CIPC and the amendments to the Companies Act.

Mr Harris also noted that during an earlier briefing on Stats SA’s strategic plan, the Committee had had discussions on budget increases for Stats SA, and that Minister Manuel had said that the SG had to justify the increases. From the current report, it was clear that Stats SA had instead experienced a cut in its budget, and he asked if that was because it was regarded as not justifying any increase, or because  National Treasury was not satisfied with its motivation, or if there was any other reason.

Mr Harris sought an assurance to the Committee that this year Stats SA was not going to have a qualified audit.

Mr Ross said he was happy with the 2013/14 work plan but said that the qualified audit was “a dent in the image” of Stats SA that had to be rectified.

Mr Lehohla responded that measures had been put in place to correct the audit outcomes from the previous year, and good governance was restored. The issue was dealt with in conjunction with the Auditor General. (AG) The Audit Committee was meeting regularly and also met with the AG and the Minister to address all outstanding issues.

Minister Manuel said that key challenge in relation to the qualified audit was the fact that handling a census brought about a phenomenal number of changes in the basic financial system, particularly the payment system. In 2011/12, the system received 60 000 invoices, an enormous number.

Mr Ross was pleased to see the information and data now available on poverty levels in municipalities, saying that this would enable interventions to be made in wards, municipalities and districts.

Mr Ross asked whether the statistics could be defined in terms of corruption and bad governance.

Ms Z Dlamini-Dubazana (ANC) said that, in relation to the budget and the programmes of Stats SA, there was a need to look at what the Statistics Act expected from the organisation. The wording of this Act was quite limiting, speaking mostly of collection, production and dissemination, and she believed the scope of the Act must be broadened.

Ms Dlamini-Dubazana made the point that the Minister had said that the data was collected, but not very well used. She proposed that the work done by Stats SA should be well used by municipalities and government departments, and that Stats SA and the Minister should ensure that Stats SA was encouraging the municipalities.

Mr Lehohla told the Committee that Stats SA was getting positive results out of its collaboration with departments such as the South African Police Services (SAPS), SARS, Department of Home Affairs and others. Local government and municipalities were not taking advantage of the statistical information made available by Stats SA. The organisation was, however, going to continue to encourage municipalities and municipal authorities to make greater use of statistics in the planning, administration and governance. 

Ms Dlamini-Dubazana referred to slides on economic classification, saying the priorities of Stats SA were well set out, but the budget was not sufficient.

Ms Dlamini-Dubazana asked when positions in Stats SA would be filled permanently. The organisation had a very serious task and required a lot of capacity. She asked if Stats SA was intending to improve skills only within the organisation or with all the organisations involved in statistics.

Mr N Singh (IFP) asked why there was an increase in amounts budgeted for use of consultants, and why they were needed if funded posts were empty. He also questioned why there was a reduction, and not an increase, in the communications budget.

Mr Lehohla said that the use of consultants was important in terms of the cost price analysis. Stats SA needed them and it picked its consultants carefully and there was a blend with its officials to ensure skills transfer.

Minister Manuel presented a graph to the Committee which provided a breakdown on the gender and educational resource nature of the labour force. He commented on skills generally, saying that one of the major challenges in South Africa was that the country did not produce sufficient people with a passion for maths and science, so there was acute skills shortage. Stats SA picked up on people late.
Mr N Singh (IFP) said that it was good that the “My ward my councillor” project was working.

Mr D van Rooyen (ANC) agreed but asked if the project provided for the changes in councillors after by-election results, and whether it was sufficiently flexible.

Mr Lehohla said that the information in the “My ward my councillor” project was going to be updated regularly by Stats SA. 

Mr Singh noted that the Chairperson of the Financial and Fiscal Commission (FFC) had made some comments about the community survey of 2007, saying that the results were unhelpful. He asked if there had been enough communication with FFC. This also led to his next point, whether there was enough communication between Stats SA and the other institutions releasing data, which was important, so that ethics and results could be harmonised.

Mr Van Rooyen said that the issue of statistical coordination was a serious issue and no headway was being made. There was the need for improved coordination, as the converse compromised service delivery and the NDP, and he questioned the position of the work programme on this.

The Minister referred to his earlier comments on the skills shortage, and the fact that Stats SA struggled to find sufficient skilled people, and said that this was another reason why there was indeed difficulty in coordination. There was the need for a National Statistical System. Ideally, every government department had to collect statistics and Stats SA should be coordinating. The Departments of Education had to play a very critical role in generating the right skills set in the country. The point by the Committee was that Stats SA was not yet there in terms of skills.

Mr Lehohla added that there was the need for credibility and he believed that Stats SA had “gained some of the stripes”. He agreed with earlier comments on the strengthening of the Statistics Act and said it should be possible to make amendments to enhance coordination with other institutions especially the NPOs. Stats SA could not generate all the statistics and there was room for many other organisations within the statistics field.

The Minister said that coordination was also linked to the issue of the budget. Stats SA had to try to persuade National Treasury that what needed to be done by Stats SA was more important than what was to be done by other departments. Government had to agree that there was the need to build talent by increasing the number of interns at Stats SA.

Mr van Rooyen noted a reduction of the budget for non-profit organisations (NPO) allocations, and questioned its impact.

Mr Lehohla agreed that the allocations had dropped, but this was because many of the payments previously were linked to the past activities related to the 2011 Census

Mr Van Rooyen asked that the Committee be given a strategic plan so that Members could understand what the exact plans were, and how implementation was going to be done in the future.

Mr Lehohla confirmed that the report would be made available to the Committee.

The meeting was adjourned.

 


 

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