Department of Tourism Budgetary Review and Recommendations Report; Oversight Report to Free State and KwaZulu-Natal


17 October 2013
Chairperson: Mr D Gumede (ANC)
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Meeting Summary

The draft Budgetary Review and Recommendations Report (BRRR) of the National Department of Tourism (NDT) was placed before the Committee for consideration.   Members were encouraged to make recommendations and effect changes to the document where they deemed necessary.  The range of issues discussed and considered for inclusion in the Report included:

• The budget of the domestic tourism branch needed to be increased in order for the NDT to intensify its domestic tourism efforts.
• Increases in electricity tariffs and municipal rates pushed up the operational costs of establishments, and consequently had a negative impact on tourism. This needed to be taken into consideration by municipalities.
• The NDT should take into account the effect of reports of “political uncertainty” and correct any misconceptions in the industry, and try to address the issue in their marketing campaigns.
- The budget of the NDT should be increased so that it could ensure that transformation was taking place in the industry.
- The Department of Public Works should do a review of the Expanded Public Works Programme (EPWP) and present the results to the Committee.
- The NDT should report to the Committee on a biannual basis, as was agreed previously.

The Committee adopted its provincial oversight report, as amended.

Meeting report

Draft Budgetary Review and Recommendations Report (BRRR)
The Chairperson stated that the BRRR was one of the most important documents of the Committee. It enabled the Committee to consolidate its oversight with stakeholders and the private sector, express its views and make recommendations.  He encouraged members to make additions and amendments to the BRRR. The Committee agreed to go through the document page by page, and to effect changes as they went along.

Numerous grammatical and spelling changes were effected to the document, most of which were suggested by Mr M Shah (DA) and Ms M Njobe (COPE).

Mr Shah suggested a grammatical change on page 2, paragraph 1.2.3, but Ms Njobe said that the extract was perhaps taken verbatim from a National Department of Tourism (NDT) document, and hence could not be changed.

Mr Sibusiso Khuzwayo, Committee Content Adviser, said that he would double check it.

The Chairperson suggested that the 30-day payment period for services rendered by service providers should be included in the findings of the Committee in the BRRR.

Mr Shah referred to page 7, which dealt with the budget of the NDT and said that if domestic tourism was to be promoted over and above international tourism, then the budget for domestic tourism needed to be increased. The Committee should recommend that the National Department of Tourism should be given R200m for domestic tourism.

The Chairperson said that a recommendation could be included under “Recommendations of the Committee,” on page 23 of the BRRR.

Mr Shah felt strongly about the issue, and said that the figure of R200m should be included.

Mr Khuzwayo responded that the NDT could do its own costing of the figure, as they would know how much they needed for domestic tourism.

Mr Shah said that he had obtained the R200m figure from discussions which he had had with the Minister of Tourism and the Director-General of the NDT. He felt the figure should be included in the recommendation made.

Mr Johan Durandt, Ministerial Liaison Officer, said that perhaps it was a good idea for the NDT to quantify the amount they needed themselves.

Mr Shah said that the recommendation could state that the NDT should indicate what the desirable amount would be in order to meet their domestic tourism targets.

Ms Njobe agreed that the Committee could not state the amount the NDT needed. The NDT should quantify the amount itself.

The Chairperson shared Ms Njobe’s sentiments.

Mr Durandt referred to page 14 of the BRRR, paragraph 5.1.3, which dealt with “Key reported achievements,” and said that no mention had been made of the 800 chefs that had been trained by the NDT. He asked the Committee section to check on the figures.

The Chairperson referred to page 17 of the BRRR, which contained the constraints cited by the industry which had hampered business in 2013. Rising operational costs due to increases in electricity and municipal rates, had affected tourism businesses. He asked the Committee to make a recommendation in this regard, as tourism was being hampered by increasing operational costs which establishments had to bear.

He also referred to the first bullet of the constraints listed, and was concerned by the use of the term “political uncertainty” used by the industry. It had heavy implications, and he was concerned about how people were going to perceive it.

Mr F Bhengu (ANC) suggested that the issue of “political uncertainty” be flagged and that it be dealt with when the Committee met on Tuesday, 22 October 2013, to deal with the rest of the BRRR.

Mr Shah said that the Committee would definitely have to change it.

Mr Bhengu stated that the Committee needed to correct perceptions created by organisations.

The Chairperson suggested that the BRRR should reflect the source of these perceptions.

The Committee agreed.

The Chairperson also suggested that the Committee should recommend in the BRRR that the NDT take into account any misconceptions created, and address them in their marketing campaigns.

At the top of page 18, Mr Shah suggested that mention be made that the cancellation of the direct flight from the United Kingdom to Cape Town had had an impact on tourism in SA.

On page 19, under the “Committee’s Key Findings and Response,” the Chairperson said he wished the issues of the 30 day payment period of service providers by the NDT and the vacancy rate of the NDT, to be included. It should be included under subsection “7.3 Service delivery performance” on page 20. It should state that the NDT was complying with the 30-day payment period, and the vacancy rate of the NDT should be checked.

On page 19, under “Governance and operational issues,” Mr Shah was not sure about the statement that     ”companies appointed to implement Social Responsibility Implementation projects were not South African and did not have the capacity to deliver on these projects.”  He could not recall that the perpetrator was not a South African.

Mr Khuzwayo explained that the project implementer who had absconded, was a Zimbabwean.

Mr Durandt said that the person’s company could be South African.

The Chairperson suggested that if there was doubt, it would be best to check the correctness thereof.

Mr Durandt said that it was best to capture it in such a way that reflected that it was an allegation made by the community where the project was located.  The Committee suggested that the NDT investigate it. 

Mr Jerry Boltina, Committee Secretary, said that the Committee also had to comply with paying its service providers within a 30-day period. He was worried that service providers had not yet invoiced the Committee for services that had already been provided to the Committee a while back.

Mr Durandt said that payment should be made within 30 days of being billed. Mr Boltina should not be concerned if the service providers had not yet billed the Committee.

Mr Shah asked why the Committee had not been invoiced immediately after the service providers had delivered the service. Was the Committee doing something wrong?

Ms Njobe spoke to the recommendation made (on page 21) about the National Department of Tourism’s budget needing to be increased.  Related to this, she asked whether the Committee should not say something about transformation needing to take place in the industry, and thus an increased budget would be required. If added to the recommendation, it would strengthen the motivation for a greater budget.

The Chairperson asked whether it would not be more appropriate to make the addition on page 24, which covered performance-related recommendations, and where a recommendation relating to transformation was already captured.

Ms Njobe explained that the point she was trying to make was not just about transformation needing to take place, but that a greater budget was needed in order for the NDT to ensure that transformation did take place.

The Chairperson said that the issue was whether to include the suggestion under “financial performance and forward funding recommendations” or “performance-related recommendations”.

Ms Njobe said that the suggestion she was making was requesting a greater budget for the NDT, while giving a motivation for it. She suggested that it be placed under “financial performance and forward funding recommendations”.

The Committee agreed.

Mr Shah said that under “performance related recommendations,” in the recommendation covering Social Responsibility Implementation (SRI) projects, he suggested that a provision be included that provincial and local government should get involved.

The Chairperson said that SRI projects required integration at national, provincial and local government level.

Mr Khuzwayo said that the NDT had already done national, provincial and local government integration on SRI projects.

The Chairperson said that if the issue had already been addressed, the Committee could mention it in its findings in the BRRR.

Mr Durandt suggested that the Committee could make a recommendation that the Department of Public Works should do a review of the Expanded Public Works Programme (EPWP) and present it to the Committee. It was the Department of Public Works that could make a change.

Ms Njobe said that the original objectives of the EPWP needed to be looked at. The original objectives were very promising, but implementation had been the problem. The transfer of skills was particularly problematic. Every project was supposed to have a transfer of skills.

The Committee agreed.

On page 23, the Chairperson suggested that the recommendation on tourist airlift make a distinction between international, regional and local airlift.

Mr Khuzwayo said that a distinction was made between international, regional and domestic airlift.

Ms Njobe, on page 24, referred to the performance recommendation which dealt with the leveraging of Special Infrastructure Projects (SIPs). At present, there was no direct benefit to tourism.

Mr Durandt said that SIPs should be identified as a means to support infrastructure for tourism.

The Chairperson agreed that the benefits of SIPs needed to be optimised by tourism.

Mr Durandt referred to page 25, and referred to the NDT’s assessment of its targets. He noted that the NDT needed to provide the Committee with a performance report every six months.

Ms Njobe said that it was important for the NDT to report back to the Committee. The NDT had many reports relating to the meeting of its targets. Those reports, in addition to quarterly reports, should be demanded by the Committee.

Mr Khuzwayo said that the NDT had submitted its Annual Report 2012/13 in time. However the NDT had previously agreed to report back to the Committee on a biannual basis, but it had not materialised. The Committee had to decide whether the NDT should still report biannually as agreed, or follow the prescripts of reporting to Parliament on a quarterly basis.  

The Chairperson stated that perhaps the Committee should stick to the NDT having to report to the Committee on a quarterly basis.

Mr Durandt responded that the Committee had agreed that the NDT should report on a biannual basis. Six-monthly reporting was regarded as reasonable. Quarterly reporting would be too tight. The Minister had requested the six-monthly reporting. The NDT should therefore honour its commitment.

Ms Petra van Niekerk, NDT Parliamentary Liaison Officer, agreed that biannual reporting was more reasonable than quarterly reporting. She would check on which other NDT reports could be made available to the Committee.

The Chairperson said that perhaps the Committee had become complacent regarding the reporting of the NDT because they had spent 98% of their budget.

The Chairperson noted that capital expenditure by the NDT should be monitored.

The Committee agreed that the NDT should report to the Committee on a biannual basis.

The Chairperson pointed out that there was no way that the Committee would be able to adopt the BRRR at the present meeting, as there were too many changes that needed to be incorporated.

Mr Boltina said that the Committee could adopt the BRRR the following week, after changes had been made to it. He would have to inform the House Chairperson that the Committee was unable to complete the BRRR by 18 October 2013, as was required.

The Committee agreed that the BRRR Draft should undergo final editing and that Members would meet on 22 October 2013 to consider and adopt the BRRR.

Provincial Oversight Report to Free State and KwaZulu-Natal Provinces
The Committee adopted its Provincial Oversight Report, as amended.

The meeting was adjourned.  


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