The Committee met with the Department of Science and Technology and the Technology Innovation Agency (TIA) in a virtual meeting to receive briefings on the TIA's Decadal Plan and annual performance plan. The presentation covered the context and content of the Decadal Plan, the progress towards finalising it, and the ongoing work related to the 2019 White Paper and the Plan.
The TIA's annual performance plan highlighted how it had been performing well in the year under review, indicating that nine out of ten output indicator targets had been met or overachieved, and that the average performance for the year sat at 99%. Its presentation covered its commercialised technologies; highlights within the bio-economy; its response to Covid-19; and partnerships, output indicators and budget.
Members asked about delay in the appointments of the board and the chief executive officer; the low stakeholder satisfaction rate due to internal operational inefficiencies and lack of responsiveness; the role that the TIA could play in assisting domestic information communication technology (ICT) companies to acquire tenders; the demographic details of the 9 000 small-scale farmers that had been trained; innovative partnerships to assist in the fight against gender-based violence; and whether the DSI had worked on forging a partnership with other departments to ensure that the Decadal Plan objectives were achieved.
Department of Science and Innovation on STI Decadal Plan
Dr Phil Mjwara, Director-General, Department of Science and Innovation (DSI), took Members through the presentation, which covered the summary of the context and content of the 2021-2031Decadal Plan, progress towards its finalisation, and the ongoing work related to the 2019 White Paper and the Plan.
Referring to the ongoing work, he said existing work would not be stopped, but would be broadly oriented over time towards the foresight areas, and others. For instance, the existing National Research and Development Strategy (NRDS) technology missions would be reviewed and reframed to ensure continued relevance. Although innovation and impact were important, support for basic and curiosity-driven research also remained pivotal, and would continue.
Lastly, innovation would support all economic sectors and public services, not only in the foresight areas but also in tourism, the provision of infrastructure, government decision-making, local and rural development, and others.
Currently, there was an ongoing review of the new Strategic Management Model and restructuring and strengthening of the National Advisory Council on Innovation (NACI). A National Treasury/DSI task team was currently working out the details of integrating an STI budget coordination mechanism into government budgeting via the medium-term expenditure framework (MTEF). The Department was nearly finalising the report of the Ministerial Review Committee on the Higher Education, Science, Technology and Innovation institutional landscape for integration into the final Decadal Plan.
There was progress towards its finalisation, as the Cabinet had approved the broad direction and thrusts of the 2021 draft Decadal Plan on Science, Technology and Innovation 2021-2031 for further consultation with business, academia, civil society and the National Economic Development and Labour Council (NEDLAC). The Minister of Higher Education, Science and Innovation has engaged his Cabinet counterparts on the establishment of an inter-ministerial committee (IMC) on science, technology and innovation, co-funding for the Decadal Plan priorities, and an innovation compact for South Africa.
Technology Innovation Agency on its Annual Performance Plan
Mr Thabiso Ramasike, Chairperson of the Board, Technology Innovation Agency (TIA), presented the annual performance plan to the Committee and commenced with TIA’s performance, saying that nine out of ten output indicator targets had been met or overachieved, and that the average performance for the year sat at 99%.
The TIA had achieved some operational efficiency gains, with an efficiency ratio of 25% against a target of 30%; a 100% disbursement of the MTEF allocation of R410 million; increased leveraging capacity of 3.3 x R410 million (R1.37 billion); a high level of responsiveness towards investees, with bridging finance and timeline extensions under lockdown conditions; the securing of value-added tax (VAT) exemption for TIA invested funds; and achieving a turnaround time of 80 days for investment approvals.
The rest of the presentation covered performance indicators and outputs, partnerships and budget.
See presentation attached for further detail
The Chairperson commented on the TIA, and said that before the lockdown the Committee was not happy with the chairperson of the board, who seemed to have absconded his duty and resided in Australia. The Acting Chief Executive Officer (CEO) also had issues, but the Committee was happy with the presentation and it looked as if there was stability in the organisation, and the achievement of nine of the ten targets was commendable. It seems like everybody was oriented towards achieving the targets of the organisation.
The CEO knew what needed to be done and he was focusing on that. This was good for an organisation like this. The Committee had also learned that the organisation would be receiving a clean audit for the third time.
The draft Decadal Plan was still a work in progress, and from the TIA’s presentation one could see that there was beginning to be an alignment between what the TIA was doing and what the Decadal Plan articulated as a plan going forward. The Decadal Plan was one of the most important plans. There was an emphasis on the issues of climate change and biodiversity. Sometimes one did not appreciate what one had, and South Africa was one of the most bio-diversified countries in the world, and this biodiversity must be protected.
Mr T Letsie (ANC) said that he was uncertain whether he would follow the Chairperson tune with his compliments to the TIA. On 10 March and 19t May last year, the Committee had met with the TIA, and it had informed the Committee that the process for the appointment of the Chief Executive Officer had been concluded, and it was waiting for ministerial and Cabinet approval, but today they still had an acting CEO. What had happened to the preferred candidate that was said to have been appointed?
Secondly, the TIA had informed the Committee that there was an interim board that had been extended for three months. Why was there no appointed board?
Thirdly, the TIA had informed the Committee that it would need a budget of R1 billion for innovation project disbursement. The level of the current budget restricted TIA’s risk appetite and, by extension, the sector it operated in, so its financial sustainability remained a concern. What was the TIA’s view on this?
The stakeholder satisfaction rate was low due to internal operational inefficiencies and lack of responsiveness. Could the Committee get a comment on this?
Most departments, all the way down to the district level municipalities, were using international companies for information communication technology (ICT) projects. Was it difficult for South African companies to compete at that level? What could TIA do to assist local companies to increase their capacity to be able to get these tenders from departments? Did the TIA think it would assist the country to achieve this objective, and have a dedicated focus on working with local companies to give them the capacity to compete at that level? The Committee would love to see the ICT issues at the National Student Financial Aid Scheme (NSFAS) being addressed by South African-owned companies. The TIA could play a meaningful role in this space. Even in Parliament, Committees make use of Zoom to hold meetings, but surely there must be local companies that were black, women and youth-owned that could provide this service. If there were any, they must be capacitated and assisted to get a share of these tenders.
He also welcomed the Decadal Plan, and indicated that he was satisfied with it.
Ms J Mananiso (ANC) commented on the Decadal Plan, and said it was a good story to tell. The Committee should get a specific date on the finalisation of the board. She believed that the TIA still needed to improve, because all the targets must be met.
It had been indicated that 9 000 black small-scale farmers had been trained -- what were the specifications on the demographics? She was concerned with matters related to gender-based violence (GBV), and wanted to know if the TIA had any innovative partners to assist in the fight against the scourge of GBV. Lastly, what was the sectoral composition of small, medium and micro enterprises (SMMEs) that would be supported in the 2021/22 annual performance plan?
Ms N Mkhatshwa (ANC) asked if the Decadal Plan made provision for a relationship between the Department of Basic Education (DBE) and the DSI. There was a strong relationship between the DSI and the post-school education and training (PSET), sector and it would be important to ensure that the DSI assisted in shaping and reviewing the science, technology and mathematics curriculum in the DBE. Had this been considered yet by the DSI?
On revitalising agriculture, one would assume that the DSI could not achieve the plans of the Decadal Plan in silo. The Department would need support from various stakeholders to implement the Decadal Plan.
Considering the impact Covid-19 had had on some of the research that institutions of higher learning could have been doing, which could have contributed towards animal improvement and general engineering etc, the facilities that could have been used for research at the University of Zululand had been abandoned and become dilapidated. Between the DSI and the Department of Higher Education and Training (DHET), there was a need to ensure that all these facilities and systems were functional to reach the objectives of the DSI, as articulated in the Decadal Plan. One could not have facilities in institutions of higher learning that could be contributing to the Decadal Plan, not functioning.
Ms D Sibiya (ANC) asked about the public consultations in August, the provinces in which the consultations would take place, and the plan to call on the participants. She asked the TIA if it had the capacity to manage an increased allocation in order to increase output and impact. How did it plan to support the capability of the State in the digital age to provide solutions to improve the quality of life for all South Africans?
Mr Ramasike replied that on governance matters, the expiry date for the board was 31 March, and it had been given a six-month extension up to the end of October 2021. The board had recommended the appointment of a candidate, and that submission was made at the end of 2019, but then the process was at the behest of the ministry. The TIA review process included the role of the CEO, and part of the process was to allow the review to be finalised before the appointment of a permanent CEO. The recommendations that would come from that review would be taken into consideration when a new CEO process was started again. The TIA had a fully functional board, although it did have the status of being an interim board.
Referring to the budget, he said most institutions needed more resources, and the entity was no exception.
The issue of the stakeholders' rating was a concern, but this was part of the transition to the stability of the TIA. It was crucial, within the National System of Innovation (NSI) and beyond the NSI, to take into account the stakeholder reviews.
The ICT matter was a national question, and there had been a statement in the news that Eskom was defaulting on a R3 billion debt because of a US company. This was a major national issue, and was something that the TIA needed to absorb and look into how it could look at ways to ensure that South Africans and local companies were able to contribute towards the development of the country. TIA was going through its own ICT procurement process, and the local companies would be taken into account.
Mr Patrick Krappie, Acting CEO, referred to the TIA's requirement of R1 billion, and said that last year the entity had a baseline funding of R410 million, and this year it was R406 million. Of the R406 million, about R180 million went towards servicing existing contracts. What remained went towards operations and new investments. It had therefore looked into minimising operational costs to avail more money for investing. The demand in the market was for the TIA, as a national entity, to make a difference, and the R1 billion requirement was to respond to that demand. Technology funding was very expensive, and if the TIA was going to enhance commercialisation, larger amounts of money would be required. The TIA was funding projects mostly at the level of about R5 million to R50 million. It was not complaining about a lack of funds, but that R1 billion would enhance the work that the TIA could do and its role in building a capable dynamic eco-system.
Government procurement of locally developed technologies was an area where the Department was also leading the charge on how one could increase public procurement as a vehicle to further education. The Decadal Plan had shown how this was going to be achieved. The TIA had launched social economic partnerships for technology acquisitions and deployment funds. This was an instrument that looked at government using its own money to take locally developed products and place them in the hands of municipalities, and ask potential users to demonstrate and ensure that they were procured. This was a pilot exercise. The problems that the entity had to deal with were within the Public Finance Management Act (PFMA) on National Treasury, and some of the provisions of the legislation need to be changed.
Most countries that were highly concerned with innovation used public procurement as an instrument to promote innovation, with governments being the biggest buyers of innovation solutions.
The TIA was working with the Department on the process of funding a laboratory that focuses on developing solutions for GBV, and in the coming months it would be able to produce a report on the results of this initiative.
Prof Yonah Seleti, Acting Deputy Director General (DDG): Research and Development, DSI, referred to the consultations regarding the Decadal Plan, and said they were using the platform between the DSI and DHET. There were regular meetings where they were attempting to align the activities of the two departments where they had common interests. The DSI had looked at the PSET sector to ascertain what was required of it. The consultations were building on what had already been identified, and the DBE had already been approached.
Dr Mjwara said the Department may seek the Committee's advice on how to get civil society and other young people into the discussion. In the document, the DSI was proposing that national, provincial and local government should put up some money and coordinate the budget. While it accepted the fiscal constraint environment, the Department was of the opinion that if the proposals made were accepted, the Decadal Plan would be implemented.
The Minister had said that until he received the report of the review of the TIA, he would rather hold back on the finalisation of both the board and CEO, because the type of board or CEO that one needed may be dependent on the proposals that came from the review Committee. The review Committee was tabling its report to the Minister sometime this month, and hopefully that would shape the type of board and CEO that the TIA needed to have.
The Chairperson thanked the delegates for the responses, and commended the TIA on the progress that it had made in bringing stability into the organisation.
The meeting was adjourned.
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