Executive Undertakings by Ministry of Employment and Labour; Matlala Petition

NCOP Petitions and Executive Undertakings

02 September 2020
Chairperson: Ms Z Ncitha (ANC, Eastern Cape)
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Meeting Summary

Video: Select Committee on Petitions and Executive Undertakings (NCOP) 02 Sep 2020

Executive Undertakings made by Minister of Employment and Labour (during the Question and Answer Session of the NCOP on 11 July 2019)
Executive Undertakings made by Deputy Minister of Employment and Labour (during the Question and Answer Session of NCOP on 28 July 2020)

The Select Committee received briefings on the executive undertakings made by the Minister and Deputy Minister of Employment and Labour, dated 11 July 2019 and 28 July 2020 respectively.

Members asked about the lifespan and maintenance plan for the 24 mobile units; the possibility of purchasing more mobile units; criteria for mobile unit placement; corresponding budget provision for labour inspectors; progress on Department’s commitments and undertakings and if affected by COVID-19; specific provision made for women in training; the impact of COVID-19 budget cuts on Commission for Conciliation; Mediation and Arbitration (CCMA); Department’s assistance to Small to Medium Enterprises to reduce job losses; and its projects for women; youth and people with disabilities.

Meeting report

Deputy Minister’s remarks
Ms Boitumelo Moloi, Deputy Minister of Employment and Labour, explained that the Minister was finalising a meeting and would be joining the meeting soon. She highlighted the following points:
• Public Employment Services, in a joint programme with Department of Higher Education and Training and funded by the European Union, will purchase 24 mobile units. This represents a strategic shift from bricks and mortar labour centres and youth centres to a strategy of taking services to the people, reducing the travel costs of work-seekers, and taking into account the new realities of social distancing in the era of Covid-19.
• The Unemployment Insurance Fund (UIF) is committed to implement the labour activation programme  as provided for in section 5(d) obligation in UIF Amendment Act and sets aside 10% of its assets.
• The UIF has also committed R394 million to fund training for 26 000 people of which 50% would be made up of women and youth. R5.9 million is committed to the Commission for Conciliation, Mediation and Arbitration (CCMA) to preserve jobs.
• The UIF will provide R104 million to Productivity SA to assist Small to Medium Enterprises to preserve jobs.
• The Department will strengthen its online application system for employers and workers.
• Those are the commitments made by the Department which the Committee expected a progress report.
• The Department’s took the Select Committee oversight very seriously and highly valued its inputs.

Minister’s Remarks
Mr Thulas Nxesi, Minister of Employment and Labour, joined the meeting and apologised for being late.
He provided an update on the progress of the Specialised Youth Centres. The Department of Employment and Labour (DEL) intended to roll out 10 youth centres, but due to COVID-19 pandemic, it had to change from youth centres to mobile units with IT access for more people to be exposed to employment opportunities.

The Minister said the Labour Activation Programme is an effort to preserve jobs under the pandemic. The COVID-19 tax benefits scheme saw R41.6 billion being disbursed to 820 000 employers who made 9.5 million payments to workers. He emphasised the importance of inspections and told the Committee that 3 500 additional inspections had been carried out on top of the regular inspections in 2019/20. DEL will hire additional health and occupational inspectors. 60% of them have been trained and are in place and the remaining would be in place by the end of October. The Minister highlighted the importance to have a functional regulatory inspection framework.

The Minister noted the negative impact of the serious budget cuts due to National Treasury instructions.

The Minister said that the Auditor-General’s report will be made available on the DEL website. Since he had to prepare for the audit report, he asked for permission to withdraw from the meeting at 2pm.

Progress Report on Executive Undertakings made by Minister (NCOP plenary of 11 July 2019)
Mr Thobile Lamati, Director-General: Department of Employment and Labour, gave a progress report on the executive’s undertakings. The focus areas were provided to the Committee and the foundation framework.

The Director General reported on the following:
• Progress in DEL’s 10 specialised Youth Centres. The addresses and contact details of the existing Youth Centres were provided to the Committee.
• Funding towards the six Labour Centres is re-directed towards procurement of 24 mobile panel vans that are to be well equipped with computers.
• Progress in strengthening the Labour Activation Programme (LAP).
• The establishing of UIF partnerships to create artisans through apprenticeships. The list of approved partnerships were given.
• Progress in assisting persons wishing to start their own businesses and its future plans for Enterprise Development partnerships.
• Its plan to address skills demands in the labour market, aligning employment opportunities with training programmes, as well as progress in inspection and enforcement services.
• The UIF has implemented the flat rate for maternity benefits since start of January 2019 and all claims are assessed and paid on 66%.

The Chairperson thanked DEL for sending the presentation early to enable Members to prepare.

Ms S Shaikh (ANC, Limpopo) enquired about the lifespan and the maintenance plan for these 24 mobile units. She encouraged DEL to continue to think differently, particularly given COVID-19 circumstances where people in certain areas have difficulty accessing employment services.

She noted in the presentation the 200 inspectors to ensure the implementation of minimum wages. She understood the intention of DEL; however, there was no budget for that item and she wanted an explanation.

Mr I Sileku (DA, Western Cape) commented on the many timeframes in the presentation. He asked if those commitments had been met within those timeframes. If they have not been met, he asked if DEL had alternative plans for that.

He asked about DEL’s intention to purchase more mobile units. Considering the geographical vastness of the Western Cape, three mobile units will not be enough to provide services to communities.

Mr Sileku asked about the DEL undertakings made prior to COVID-19. How many of those undertakings were not going to be fulfilled as a direct result of COVID-19. Had DEL alternative plans to remedy that?

The Chairperson commented on DEL’s undertaking in its training project which intended training 26 000 workers including 50% young people and women. It was not clear in the presentation if women were specifically catered for.

She was pleased to know about the locations of the mobile units. She asked for the criteria used to determine the locations for placing the mobile units.

Mr Lamati appreciated Ms Shaikh’s comment. It is not often that the executives get compliments from the oversight body.

The DG replied about the lifespan sustainability of the mobile units. In the past, DEL owned quite a few mobile units and these units can last for about five to six years. Proper maintenance is the key. The ones that DEL procured this time are much more durable, much bigger in size and can load more systems in those units. DEL is cognisant that people need to stay at home under COVID-19. This project will most likely remain in the long-term. With the permission of UIF, it has already procured eight buses to be distributed to each province in the country with the exception of Mpumalanga. DEL already has two buses for job fairs. The purpose is to encourage young people to register for job opportunities.

The DG replied that the Department's intention was not to stop at 200 inspectors but looked at expanding the capacity. It does still consider appointing more inspectors but due to funding constraints, DEL was unable to appoint more in this financial year and in 2021/22. DEL will nevertheless keep this in mind.

The DG replied about the unfulfilled commitments. DEL always ensured that it exhausted all resources so that all commitments are fulfilled. He explained that there is a standardised process. Once a Minister or a Deputy Minister makes a commitment, DEL would then translate it into Annual Performance Plan (APP). Thereafter, DEL monitors the APP regularly and communicates with its provincial offices on a quarterly basis. DEL is looking to add more mobile units in future to provide people with more services.

On the specific commitments affected by COVID-19, the DG replied that it is a difficult question to respond to but he was certain that employment targets are not going to be met. DEL is dependent on employers to report and advertise job opportunities. Given the high number of companies in distress due to COVID-19, as also evidenced by the high volume of section 189 applications for retrenchments received at CCMA, he said that it is certain that there will be fewer job opportunities for young people and those just got retrenched. Hence, he emphasised the importance for stakeholders to work together to put in place an economic recovery plan that can save and create more jobs in the country. The economic recovery plan should be able to stimulate sectoral recoveries especially in the agriculture and manufacturing sectors. DEL is also working with businesses and labour to address these challenges.

The DG affirmed that DEL projects catered for women as well as young people.

The DG explained that the criteria DEL used to determine locations for the distribution of mobile units is based on the demands for department’s services in relation to location. The purpose is to assist community members because DEL would not want people to commute for long distances and long periods of time. It depends on the service demands for the location of units.

The Chairperson asked about the impact of budget cuta on the operation of the Commission for Conciliation, Mediation and Arbitration (CCMA) since the workload has become more intensive given the increasing number of section 189 applications.

The DG replied that DEL does assist with section 189 applications in order to preserve jobs. He made the point that budget cuts were very limited and CCMA was one of the least affected areas as the budget cut was only about R5 million. DEL also tried to cushion the negative impact brought about by the CCMA budget cut. The UIF had just paid R5.6 million to the CCMA to assist with its increasing adjudication workload.

The Chairperson asked if those were factored in DEL’s special adjustment budget.

The DG confirmed this and said that DEL now needs to factor in more additional cuts and work out a new way to cushion the negative impact. NEDLAC was also the least affected.

Progress Report on Deputy Minister's Executive Undertakings (NCOP plenary on 28 July 2020)
Deputy Minister Moloi noted the structural reform taking place in the Compensation Fund. She acknowledged that there will be systemic challenges.

The Deputy Minister acknowledged the severe strain the Unemployment Insurance Fund is under as most resources are almost depleted.

The Deputy Minister said that a total amount of R104 574 000 will be paid to Productivity SA to support its initiative in job retention and saving jobs. For many years, Productivity SA, CCMA and UIF have managed to help saving millions of jobs. This is crucially important as a business turnaround programmes under the pandemic. R23 million has already been paid to Productivity SA.

She said that the Public Employment Services and Department of Education have an initiative to secure funding for the mobile units mentioned earlier.

The Deputy Minister corrected the R49 million in Table 3 under Tranche 3 to R41 million.

The Deputy Minister said that the campaign between DEL and SABC had undertaken a survey to determine their coverage. The feedback shows that their adverts had reached 66.3% of the people which translated into 2 million people having seen advertisements at least once and 3.5 million people having seen the advertisements more than 3 times. On average, the designated audience have seen the advertisements is 5.1 times.

Ms Shaikh noted the UIF had committed R359 million in funding to provide training for 26 000 people. It also mentioned that 50% of the people targeted will be youth and women. She pointed out that there was not a specific provision that indicates women’s participation. She asked for clarity on the portion of the fund that will be spent on training women.

Mr Sileku commented on Point 4 of the report about assisting 6 000 Small to Medium Enterprises to preserve and create jobs. He asked if those were newly-established enterprises or existing ones.

The Chairperson asked for a breakdown of the fund that was exclusively given to women in the training funding. She wanted a breakdown on the projects per province that were led by women and young people.

Mr E Mthethwa (ANC, KZN) added to the Chairperson’s comment asking what programmes there were to cater for people with disabilities.

The Director-General explained that DEL does have a programme for people with disabilities which falls under Public Employment Services. What DEL does is that it firstly identifies and finds organisations that supported disability communities such as the national body for blind people and other organisations. DEL also has its own employment enterprises that exclusively employ disabled workers. For instance, DEL has factories for the manufacturing of bed linen across all provinces except Mpumalanga. He invited Members to visit these factories in the provinces.

The Director-General would provide a breakdown of the fund that was spent on women and an added category for people with disabilities.

DEL’s support for SMMEs included both newly-established enterprises and existing ones. Some of the challenges which small to medium businesses faced is the availability of working capital. DEL had an instrument called the High Impact Social Fund that is administered by the Public Investment Corporation that provides working capital and support mechanisms to ensure that those businesses do not fail.

The DG said Ms Shaikh’s question would be adequately answered once the breakdown is submitted.

The Deputy Minister replied that a lot of work and initiatives by DEL are related to people with disabilities. Members would be impressed to see the outcome, especially for those who are intellectually challenged. The Western Cape Provincial Government has a contract to supply hospital linens. All these linens were made by people with disabilities. DEL needed the support of this Committee to lobby and mobilise for greater support for people with disabilities.

The Chairperson agreed. She was aware of the school desks and the manufacturing of office furniture in West Bank in East London. She commended DEL for that work.

Committee Report on Matlala Petition
This petition called for National Council of Provinces intervention in Limpopo Department of Health's failed commitment to build a healthcare centre for the Dichoeung community in Makhuduthamaga Local Municipality (Jane Furse).

Ms Shaikh suggested the Select Committee to do a local inspection.

The Committee Report on the Matlala Petition received majority support and was adopted.

The meeting was adjourned.

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