National Department of Tourism on its 2013/14 Annual Report, with Deputy Minister

Meeting report

Minister of Tourism, Derek Hanekom, and Director General, Kingsley Makhubela, extended their apologies for not being able to attend the meeting as they were attending a conference in London.

National Department of Tourism (NDT) on its 2013/14 Annual Report
The delegation comprised of Deputy Minister Tokozile Xasa, Acting Director General Ms Morongoe Ramphele, Mr Dirk van Schalkwyk Chief Operations Officer, Mr Victor Tharage Deputy Director General: Policy and Knowledge Systems, Mr Stephen Pearce Acting Deputy Director General: International Tourism, Mr Ralph Ackerman Chief Financial Officer, Mr Zipho Nguli Director: Governance Support, Ms Lerato Matlakala Chief Director: Social Responsibility Implementation, and Ms Petra van Niekerk Parliamentary Liaison Officer.

Deputy Minister Xasa noted that tourism was a key growth sector for the economy. What was important for tourism was that integrated planning between the three spheres of government was needed. The NDT had even established relationships with academic institutions through research, which had been commissioned. The NDT had a single entity, SA Tourism, which was tasked with marketing South Africa internally and externally. The NDT had also established the South African National Convention Bureau (SANCB), which was tasked with selling SA as a meeting destination. The Deputy Minister noted some of the Department’s highlights. There was the gazetting of the Tourism Act on 2 April 2014. The NDT had established the Tourism Broad-Based Black Economic Empowerment Charter Council to ensure transformation. The NDT had an agreement with the Tourism Enterprise Partnership (TEP) regarding Small Medium Micro Enterprise (SMME) development. Also in place were the Expanded Public Works Programme (EPWP) projects with an emphasis on tourism. A total of 2 797 jobs had been created. Training Programmes were in place as well, such as the Chefs Training Programme. The NDT had implemented domestic tourism and international tourism strategies. The NDT had also initiated the Lilizela Tourism Awards, which recognised excellence in the tourism industry. She also referred to the Tourism Grading Council of South Africa (TGCSA), which undertook quality assurance by way of grading.  

Acting Director General and Deputy Director General: Domestic Tourism, Ms Morongoe Ramphele, continued the presentation. She stated that the NDT had adopted a new structure in 2012, which consisted of four programmes: Administration, Policy and Knowledge Services, International Tourism Management and Domestic Tourism Management. She explained that the International Branch focussed on policy development and not on marketing SA. The Domestic Tourism Branch was province focussed. The NDT had obtained an unqualified audit report for three years as well as the current year under review. On performance, the NDT had come up third in the top 20 ranked provincial and national departments. It was ranked first amongst national departments. Regarding the payment of its suppliers, the NDT did so within 6.1 days of being invoiced. It had over 50% female representation and 4.5% disabled persons. The target for black representation in the NDT had been set at 89%, it however managed to surpass the target and it sat at 93.9%. The NDT had managed to implement its risk management strategy. The NDT initially had audit findings related to its predetermined objectives but measures had been put in place and corrections made.

Mr Dirk van Schalkwyk, Chief Operations Officer, spoke to the Auditor-General’s Audit Report for 2013/14. As mentioned earlier, the NDT obtained an unqualified audit report with no emphasis of matter = clean audit.

Mr Ralph Ackerman, Chief Financial Officer, continued with the financial report. The NDT had spent 99.5% of its final appropriated funds. Members were provided with a percentage breakdown of actual expenditure per programme. He noted that R7.9m had been returned to National Treasury.

Mr van Schalkwyk provided specifics on the Administration Programme. On the strategic objective of a capable and skilled workforce, the key performance indicator (KPI) was to have a maximum vacancy rate of 8% maintained. The target was set at 8%. The actual performance was a vacancy rate of 8.6%, which was a deviation of 0.6% from the planned target. For the key performance indicator for representation of designated groups, he reiterated what Ms Ramphele had stated that the target for black minimum representation in the NDT was set at 89% and actual performance was 93.9%.

Mr Victor Tharage, Deputy Director General: Policy and Knowledge Systems, continued with the Policy and Knowledge Services Programme. On the strategic objective of monitoring and evaluation of tourism sector performance, strategies and policies, the KPI was the development of the state of tourism report and the finalisation of the 2012 State of Tourism Report (STR) was achieved as targetted. Another key performance indicator was to have an annual National Tourism Sector Strategy (NTSS) implementation report. The target of a 2012/13 NTSS Report was achieved. 

Mr Stephen Pearce, Acting Deputy Director General: International Tourism, elaborated on the International Tourism Management Programme. On the strategic objective to provide international tourism market analysis to inform strategic interventions, the KPI was to support SA missions to institutionalise tourism. The target to have all 126 missions supported via a business-planning model for institutionalising tourism, was achieved. A further KPI was to develop a number of policy positions to enhance tourism competitiveness. A target to develop an e-visa policy position had been achieved.

Ms Ramphele presented on the Domestic Tourism Management Programme. On the strategic objective to implement tourism growth and development strategies in order to increase tourism’s contribution to inclusive economic growth, a KPI was to have a number of national tourism programmes activated from the approved Domestic Tourism Growth Strategy’s action plan. A target was set to have a pilot budget holiday resort concept. Actual performance was a draft pilot budget holiday resort concept. A deviation from the planned target was that consultation on the concept with other stakeholders was still outstanding.  

Mr van Schalkwyk concluded with a summary of workforce representativity figures. 

Discussion
Mr J Londt (DA) referred to NDT’s two National Information Gateways maintained at OR Tambo International and at Beitbridge Border Post. He asked what were the next ports of entry to be targeted. He referred to slide 49 of the presentation document and asked why a registration fee was charged to rural enterprises that were supported by the NDT. The initiative by the NDT to have a tourism month was a good one. It seemed as though it was only going to be hosted in certain provinces. Were all nine provinces going to have an opportunity to host it? If not, why not? Regarding SA’s ranking under the top 20 tourist destinations in the world, was there a chance that SA would make the list. Only 2.5% of the NDT budget was spent on international marketing, was it to increase in the future?

Mr Tharage noted that OR Tambo and Beitbridge were pilot projects and that the next project was to be at King Shaka International. The last project would be at Cape Town International Airport. SA was ranked only 32nd internationally because SA only reported its tourist figures whilst other countries reported visitors and tourist figures. If SA did the same as other countries then it would be ranked 19th in the world. The issue was more about competitiveness and an area where SA could focus on was wildlife. SA Tourism identified items that SA should focus on.

Mr van Schalkwyk replied to the question about Tourism Month, saying that some provinces had more tourists than others. Gauteng, Western Cape and Kwazulu-Natal had high tourist numbers. Provincial MECs had decided to host Tourism Month celebrations only in the lesser-visited provinces.

Ms Ramphele added that the focus for Tourism Month was only on rural provinces.

Deputy Minister Xasa said that the aim of Tourism Month was to coordinate the activities of all the provinces.
 
Mr van Schalkwyk said that the NDT operational budget had been cut by R18m. The NDT therefore had to prioritise. The Minister informed the NDT what it should focus on. NDT also took into consideration the National Development Plan, which aimed to drive economic growth and job creation.

Mr Ackerman stated that the 2.5% of budget for international tourism amounted to R866m which was allocated to SA Tourism.

Ms M Dikgale (ANC, Limpopo) noted that the Mapungubwe National Park would not attract tourists if it remained the way it was at present. The roads to the Park were in a bad condition and signage was a problem. What was the NDT doing about this? Was assistance being given to the Limpopo Province and to the Park itself? She asked if the Committee would be invited to the Tourism Month celebrations.

Mr van Schalkwyk said that NDT needed to be cautious in relation to what did fall within its competency, that is, signage. A phased in approach was needed. The success of Mapungubwe National Park would depend on the availability of financial resources as well as on agreement with management authorities.

Ms Ramphele stated that NDT did engage with the Department of Transport over road signage. Signage at Mapungubwe would be looked at. The NDT requested provinces to identify sites that had problems with signage.

The Chairperson asked whether there were accommodation facilities at Mapungubwe.

Ms Ramphele noted that the NDT had received a request that a hostel was needed for school children at Mapungubwe. It was possible for the NDT to put accommodation in place via its Social Responsibility Infrastructure (SRI) projects. However, there was a concern about the maintenance of such a facility.

Mr S Mthimunye (ANC, Mpumalanga) was curious about what the Department on Performance Monitoring and Evaluation (DPME) in the Presidency had said about the performance of the NDT. He asked if it was correct that the NDT was to review its strategy in 2015. How many jobs did the NDT intend to create? He suggested that in reviewing its strategy, the NDT should consider coupling with the Department of Economic Development on work to be done in townships. He pointed out that Gauteng intended launching a township bank. How was the NDT involved?

Mr van Schalkwyk was not sure what NDT’s ranking was by DPME. The NDT was ranked in the top six departments as far as its predetermined objectives was concerned.

Ms Ramphele responded that the NDT did liase with other departments on township economies. Township economies were a provincial competency but the NDT could support them.

Ms Matlakala noted that the job creation target was 4 369 jobs for 2014/15.

Deputy Minister Xasa spoke about township tourism, noting that provinces had to come up with their own unique products. In Kwazulu-Natal, for instance, township tourism was doing well.

Mr L Suka (ANC, Eastern Cape) said that the NDT having achieved a clean audit could set an example to other government departments and state owned entities on “how things should be done”. He felt that emphasis should be placed on rural tourism, especially in the Eastern Cape. He asked whether the NDT had looked into maritime tourism for the Eastern Cape, in cooperation with the Department of Transport. Maritime tourism held huge opportunities. He asked if there were plans in place to activate the coastal belt of the Eastern Cape Province. He asked which seasons had the highest tourist volumes and which seasons had the lowest. NDT needed to do more work on heritage sites.  The Sarah Baartman heritage site was a huge project but at present it was quiet. A way needed to be found through local government to give attention to heritage sites. Perhaps the Department of Arts and Culture should be brought on board? If international tourist figures to SA were high, what opportunities were there for job creation? What was the NDT job creation target for the current year?

Mr Tharage spoke to maritime tourism, saying that the problem was that SA did not own cruise ships. Currently overseas-owned cruise ships docked at South African ports and picked up passengers and went on cruises. SA could build ships but it was a very costly exercise. At this point it did not make financial sense to do so. The issue of  “foreign” cruise ships picking up passengers and going on cruises was a global problem. The United States had also identified it as a problem. He explained that seasons of preference differed from market to market. The Japanese liked to visit SA in the spring, the Europeans in the summer and Indians liked to visit in the month of July. Tourist operators were well aware of which times their markets liked to visit. 

Mr van Schalkwyk noted that heritage sites and world heritage sites were high on the agenda of NDT. He pointed out that world heritage sites fell within the competency of the Department of Environmental Affairs. 

Deputy Minister Xasa said that NDT did have a memorandum of understanding with the Department of Arts and Culture. Heritage sites were a priority.

Mr W Faber (DA, Northern Cape) asked if it was true that the new visa regulations could cut Chinese traveller figures by up to 70%. He also asked when SA’s e-visa was to be implemented. Had the NDT met with the Department of Home Affairs about the regulsations?

Deputy Minister Xasa pointed out that China was one of SA’s core markets. However the Chinese were more concerned with the Ebola virus than they were about the immigration regulations. The Minister of Health had addressed the Chinese over the Ebola issue.
 
Mr Tharage noted that a great deal of discussion had taken place between the NDT and the Department of Home Affairs about visas. The current position for now was that the Department of Home Affairs was holding back on the implementation of the visa regulations. Discussions with industry had also taken place.

Mr B Nthebe (ANC, North West) asked how the NDT intended to bring universal access into rural areas. Disabled persons went through great difficulty in rural areas. He asked how NDT approached its transformational agenda and how tourism was linked with manufacturing and agro-processing.

Deputy Minister Xasa said that universal access was one of the grading criteria of the Tourism Grading Council of SA.

Ms E van Lingen (DA, Eastern Cape) referred to slide 19 of the presentation and noted the four security threats and risks assessments that had been conducted. She asked whether it included Information Technology (IT). On local government tourism support provided by NDT by way of self-assessments and an online portal, she asked how had municipalities reacted to it. She assumed that the bigger municipalities were able to cope but asked if the smaller ones were able to cope? What was the percentage of municipalities that had supported the exercise? When could the Committee have access to the National Visitor Information Framework report.

Mr van Schalkwyk replied that the risk assessments have covered issues such as access control. IT assessment had been done by the Office of the Auditor-General which brought in experts to check whether the NDT was archiving correctly.

Mr Tharage responded that there were different levels of support for different municipalities. With metros there was collaboration and cooperation but with the smaller municipalities, support was different. It was difficult to cover all 284 municipalities. There was a tourism toolkit for municipalities.

The Chairperson referred to the local government conference to be held in February 2015 and asked that the NDT keep the Committee informed about it. He noted that there was a draft NDT report on post settlement support provided to land reform beneficiaries. He asked when the Committee would receive the final report.

Mr Tharage said that the Committee would be invited to the local government conference to be held in February 2014.

Deputy Minister Xasa replied about post settlement support, saying the NDT did analyse where the opportunities lay. The Committee would be able to get more information by the end of March 2015.

Committee Minutes
The Committee adopted the minutes of the 29 October 2014 meeting.

The meeting was adjourned.