SAMDI Annual Report

Meeting report

PUBLIC SERVICES AND ADMINISTRATION PORTFOLIO COMMITTEE
26 March 2002
SAMDI ANNUAL REPORT

Chairperson: P J Gomomo (ANC)

Documents handed out:
SAMDI Annual Report Powerpoint presentation

SUMMARY
In SAMDI's annual report it noted increased enrolment at its training courses and improved cost recovery from departments attending training courses due to a plan for cost recovery set up by Treasury's Director General. 82% of its staff establishment is filled but SAMDI was encouraged to fill its vacant posts. The issue of sufficient funding was not a problem in the foreseeable future.

MINUTES
SAMDI (South African Management Development Institute) Annual Report
Mr Dennis Malekele, Mr Boy Ngobeni and Mr Hennie Greyning were present from SAMDI. Mr Dennis Malekele noted that the delay in their annual report, the preparation of financial statements and the subsequent audit report was due to the absence of a Chief Financial Officer at SAMDI. See Powerpoint presentation for full details of Mr Malukele's report to the Committee.

Human resource management
In his report on SAMDI human resource management, he noted personnel expenditure was R13.4 million. Details were given of the number of posts, transfers, appointments, promotions and terminations. SAMDI 's affirmative action plan was confirmed by the figures below:
Indian :3%
Colored:8%
African :52%
White :36%

Women:53%
Men:47%
Disabled:1%

The report also covered performance rewards, collective agreements with trade unions within SAMDI and skills development.

Programme performance
Mr Malekele looked at the performance of SAMDI's two programmes (Administration, Public Sector Organisation and Staff Development) in terms of its aims, outputs and service delivery indicators. He reported increased enrollment in their training modules as a result of their marketing efforts and increased cost recovery due to shadow invoicing being commissioned.

Financial statements
Donor funds to the value of R 18,083m were utilised for training and concomittant services. A fraud plan had been developed. The Office of the Auditor General's audit report had found that SAMDI's financial statements fairly present SAMDI's financial position.

Discussion
Mr Waters (DP) wanted to know why departments did not pay for their SAMDI training and why SAMDI had to invoice them. He felt SAMDI should come up with a regulation forcing defaulting departments to settle.

Mr Malekele replied that initially when the SAMDI training programmes had started, they were free of charge. Therefore the departments needed time to adapt to paying for these.

Mr Waters (DP) asked if the R18m from the donors would be rolled over to the next financial year and if the funding problem experienced last year was still prominent.

Mr Malekele replied that there would be no more European Commission funding but Treasury had managed to secure R20m for next year.

Mr Baloyi (ANC) sought the reason behind so many employees leaving SAMDI. He also wanted to know at what post level these departing staff members were and whether exit interviews had been conducted.

Mr Malekele replied that an Exit Management Policy Framework had been developed which was linked with the human resources strategy. Reasons for leaving were submitted and a report given to the SAMDI Director General. However if the departing staff member was in a high-level post, the report was submitted to the Minister of Public Service & Administration. He noted that the
Management level: 5 had been the highest level post of a departing staff member.

Dr Roopnarain (IFP) asked why a fraud plan was necessary.

Mr Malekele replied that the fraud plan was a requirement set up by National Treasury and by law. It was also part of risk management.

Dr Roopnarain enquired if R18 m was the total amount received from the European Union. She was also curious to know if the Auditor General's report simply affirmed SAMDI's good financial position or whether there were any recommendations.

Mr Malekele replied that SAMDI had received R48 m from the European Commission over a period of three years. The Auditor General's recommendations had been that an Asset Management programme and a suspense account should be established.

Ms Maloney (ANC) wanted to know what positions the 53% women employees at SAMDI occupied. She also asked how financially sound SAMDI was.

Mr Malekele replied that there were four women directors to the DG: two Africans and two Whites. SAMDI was no longer dependent on donor funds due to the R 21 million that had been rolled over to the next financial year and the R20m voted funds it had received.

Mr Bell (DP) inquired about the R497 000 which had not been spent on equipment and wondered why SAMDI did not use the accrual system.

Mr Malekele assured him that SAMDI was going on to the accrual system.

Dr Mbulawa-Hans (ANC) expressed concern about the cost recovery plan. She also wanted to know how extensive the use of sick leave was.

Mr Malekele replied that SAMDI had met with the Director General of National Treasury and they had come up with the following plan for cost recovery:
1 A debtor's list was to be formulated and updated on a weekly basis
2 The Chief Financial Officer was to write to the indebted department to claim the money.
In cases of non-response:
3 The Director General would then write a follow-up letter.
In cases of non-response:
4 Treasury would order the respective department to pay.
So far the drastic Step 4 has not yet been used.

SAMDI noted that 85 employees had utilized their sick leave:
7 employees at level 1-2
27 employees at level 3-5
11 employees at level 6-8
28 employees at level 9-12
12 employees at level 13-18.

Mr Mthembu (ANC) asked about the skills offered in training courses and how the charging of fees affected enrolment in SAMDI.

Mr Malekele listed some of the training courses offered: mentorship, service-delivey, internal audit, human resources. He noted that "there were still buy-ins despite fee-charging". Furthermore marketing of their services had attracted many departments and there were more services offered.

Mr Baloyi (ANC) inquired into the reasons for managerial staff resignations.

Mr Malekele stated that there was a variety of reasons for this but the main one was better career prospects. SAMDI had devised a retention strategy, such as incentives to ensure that staff get awarded for outstanding work, but this presented financial problems for SAMDI, mentorship coaching of employees…

Mr Waters(DP) asked how many vacant positions there were.

Mr Malekele replied that of 111 posts, 91 had been filled.

Mr Maloney (ANC)f elt that there was need for a program to address this issue, and
SAMDI needed to identify the critical positions to be filled, advertise and fill them immediately.

Mr Malekele explained that SAMDI could not compete with the private sector which is where most managers went when they left.

Ms Roopnarain (IFP) asked why IT was not an issue in the report and whether SAMDI had the problem of over-reliance on consultants.

Mr Malekele admitted that IT was a skills problem but they had found help from SITA , furthermore there was staff training. SAMDI had sent 3 of its employees to the E-Governance Workshop.

The meeting was adjourned.