Committee Report on Department of Tourism 2014 Strategic Plan

Meeting report

Draft Committee Report on Strategic and Annual Performance Plans
The Committee considered its draft Committee Report on the Strategic and Annual Performance Plans of the National Department of Tourism for 2014/15 to 2018/19.

Mr Sibusiso Khuzwayo, Committee Content Adviser, provided an overview of the Draft Report. He said that he would highlight only the key issues which had emanated from discussions in the Committee’s previous meeting on 4 July 2014.  He spoke about the mandate of the National Department of Tourism (NDT) and the work that it was engaged in. The Committee had very limited time to consider the Strategic Plan and Budget of the NDT. The Committee would usually invite the Financial and Fiscal Commission to make inputs to the Committee on whether the targets set by the NDT were realistic and attainable. This was however not possible in the current session of Parliament, given the short programme.
With specific reference to visitor arrival figures and the contribution of the NDT to employment figures, there was a need to check as to whether the figures were realistic. The NDT set itself objectives which it worked towards.
 
Regarding the reporting of the NDT to the Committee, the previous Committee had made a decision that it was necessary for the NDT to report to it only on a bi-annual basis. Reporting was not done quarterly, as was the usually accepted practice. He felt that the bi-annual reporting was a limitation, as the Committee was unable to track the NDT on a quarterly basis. He suggested that perhaps the Committee should ask the NDT to report on a quarterly basis.

On the implementation of Expanded Public Works Programme (EPWP), Mr Khuzwayo stated that a total of R99m had been allocated to the programme alone. Given the challenges attached to the EPWP, there should be tight monitoring by the Committee. One of the challenges was the issue of project implementers. The project implementers were often not located in the province or area where the project was to be found.

The project implementers should be from the same area or province where the project was located. It would allow for better monitoring and prevent the failure of projects, as was the case before.
 
The NDT had also informed the Committee that it had a turnaround strategy in place which the Committee was yet to see. The Committee could request the NDT to brief members on the strategy.
   
Mr Khuzwayo also touched on issues pertaining to budgets.  Of the four programmes of the NDT, Programme 2: Policy and Knowledge Services, had been allocated quite a huge portion of the NDT’s budget.  A whopping 94% of the NDT’s budget had been allocated to SA Tourism for the marketing of SA. An extra R100m would be allocated to SA Tourism, to be spent on promoting domestic tourism. A total of R369m was allocated for domestic tourism.

SA was divided into a northern and southern region. The northern region was made up of five provinces and the southern region of four. There were budgets for both regions.  NDT officials liaised with provinces. The NDT did have offices in the provinces, but they were not fully fledged offices. These offices mainly had provincial project managers based in them to oversee EPWP projects.

He continued with a breakdown of some of the key issues for Members that had been captured in the draft report.  The issues had emanated from discussions that had taken place in the meeting dated 4 July 2014.  On the issue of Social Responsibility Implementation (SRI) Projects, he said that it could be noted that the NDT had done forensic audits where there had been malpractice.  Some of the matters were at court. The Auditor-General’s Office had already raised the issues and had asked that disciplinary measures be implemented. The NDT in previous meetings with the Committee had not divulged any information due to the matters being sub judice.

On job creation, the NDT had said that it wished to work hand in hand with the private sector. Some of the issues to address were the ease of access into the sector, targets that were set and the recent immigration regulations introduced by the Department of Home Affairs(DHA). He suggested that the Committee engage with the NDT and the DHA to look at alternatives to address the impact that visas had on tourism. One possibility that could be discussed was the introduction of e-visas.
 
Some concerns had also been raised around grading statistics. At present, grading statistics covered only accommodation. Other sites did not form part of the criteria. The Committee needed to engage with the Tourism Grading Council of SA (TGCSA) over the issue. The effectiveness of the grading scheme also needed to be considered. The fees payable in order to be graded was one of the barriers that prevented establishments from being graded.

The accuracy of tourism statistics was another point of contention. Was 9.6m a true reflection of tourist arrivals? A meeting between StatsSA, the NDT and SA Tourism was needed in order for clarification to be obtained on how statistics were compiled.
A recurring point of discussion in the Committee was whether the budget of the NDT was sufficient. Currency exposure impacted upon budgets. SA Tourism had an R82m deficit. The hope was that National Treasury would approve its budget. It was a challenge, as SA Tourism’s budget was always being cut. In the end, SA Tourism would have to cut some of its targets. The Committee felt that the budget of the NDT was insufficient.
 
Mr Khuzwayo noted that the Committee could make financial recommendations in October in its Budgetary Review and Recommendations Report (BRRR), that the budget of the NDT be increased. The previous Committee had previously made recommendations that the budget of the NDT be increased. All that National Treasury had done was to cover some of the currency exposure of SA Tourism.  National Treasury’s efforts were considered not sufficient enough. The question was perhaps whether the appropriation for tourism had been done correctly. For the current financial year, the NDT appropriation was R1.6bn. It was not sufficient, and hence the NDT could not properly implement its rural development strategies.
 
He pointed out that there had also been a decrease in arrivals, especially for domestic figures. Domestic figures were declining. There was a decrease in arrivals from 10.2% to 5%. What was causing the dip in figures?

At the meeting of 4 July, the point was raised whether concurrency affected the work of the NDT. The NDT had responded that it was not a problem. However Mr Khuzwayo noted that there were still concurrency issues at grassroots level. A great deal of work on coordination still needed to be done. It was an issue the Committee needed to look at.

Members had also brought up the issue of SA being a signatory to many international agreements. He confirmed that indeed many international agreements had been signed, but unfortunately had not been implemented. Was SA getting value for money in signing these agreements? The Committee needed to evaluate if there was value to these agreements.

He pointed out that the NDT had spoken about the accreditation of tourist guides at the meeting of 4 July. However, no mention had been made of institutions that provided accreditation. At the Cape Peninsula University of Technology (CPUT), people claimed they were trained but not accredited. The issue at the institution had been investigated.  Accreditation was normally done by the SA Qualifications Authority. The CPUT had not offered all the modules that were required for accreditation -- it offered only some. Hence the students had not completed all the modules required. The situation was corrected with the students being trained now. The question was whether the problem existed at other tertiary institutions across SA as well. He suggested that that the Committee request the NDT to brief Members on institutions and on what was being offered.  The issue of training was a problem pertaining not only to tourist guides. There were also educators out there teaching tourism subjects at schools without having received training in tourism.

He ended the overview and referred the Committee to the Draft Report for further detail.

Discussion
The Chairperson said that the Committee needed to keep track of the work of the NDT and keep track of where its funds went. Perhaps the Committee should relook at the arrangement of the NDT only reporting biannually to the Committee.  Quarterly reporting should perhaps be reinstituted. All departments were required to spend 25% of their budgets per quarter. If funds were not spent, the question should be asked -- why not?  If virements were done, what was the reason? The Public Finance Management Act stipulated that virements should not exceed 8%.  

Mr J Vos (DA) noted that in the meeting of 4 July, he had requested the NDT to furnish the Committee with a report on Memorandums of Understanding that they had entered into. He had also requested the TGCSA for a full report. The issue of whether grading should be free, or have a fee, or whether it should be voluntary or compulsory, needed to be looked at.

The Chairperson proceeded to take the Committee through the draft report page by page, encouraging Members to make inputs where they so wished.

Mr A Whitfield (DA) asked whether the Committee would be getting a report from the NDT on projects that had failed. He noted that large amounts of funds were allocated to Small, Medium and Micro Enterprises (SMMEs). The Committee needed to have information on what projects were being funded and how the funds were being spent.

Ms L Makhubela-Mashele (ANC) added that the Committee should also receive specifics on the EPWP projects that were funded by the NDT.

Mr Jerry Boltina, Committee Secretary, said that the NDT would be briefing the Committee on all the projects that it funded. It was on the Committee Programme.

Mr Khuzwayo suggested that perhaps the Committee should obtain a spreadsheet of projects funded by the NDT before the briefing took place.

The Chairperson stated that each and every directorate of the NDT would be called to account to the Committee.

She noted that both the NDT and SA Tourism had international branches. A briefing was in order to inform the Committee what the responsibilities of each were.

The issue of MOUs were important, and the Committee needed to be briefed on what the benefits to tourism was and what progress had been made in their implementation.

Mr G Krumbock (DA) wished to make a correction to something that Mr Khuzwayo had stated. Mr Khuzwayo had earlier stated that there had been a decrease in arrivals from 10.2% to 5%. The correct situation was that there was a decline in the rate of increase in tourist arrivals, and not a decrease in tourist arrivals per se.

The Chairperson placed the draft report before the Committee for consideration, and it was adopted as amended.

Committee Minutes
The Chairperson placed the minutes of the 4 July meeting before Members for consideration. She proceeded to take the Committee through the minutes page by page.
  
Members effected substantive, grammatical and spelling changes.  It was agreed that minutes should be a true reflection of what had been discussed at meetings. Members at times differed in terms of the manner or format in which minutes should be captured. The current format of Parliament’s minutes was that issues were captured in point form.  The DA in particular did not support the current format used to capture Parliament’s minutes. The party supported the format used by the previous Parliament, which mentioned the names of persons speaking as well as capturing the gist of what had been said. The current format mentioned no names and the issue spoken about was captured in point form.
The ANC majority felt the current format was acceptable as long as the gist of what was said was captured.  The IFP also had no problem with the current format as long as the gist of what was said was captured.

The Chairperson said that it was important for the Committee to work as a collective. The Committee Secretariat was guided by the Committee Section of Parliament. The format used had been discussed by the Chair of Chairs. The reason why the format was changed was because the previous format made minutes lengthy and Members did not always have the time to read lengthy sets of minutes.

The minutes were adopted as amended.   

The meeting was adjourned.