Department Workplan: briefing

Meeting report

LABOUR PORTFOLIO COMMITTEE
1 March 2005
DEPARTMENT WORKPLAN: BRIEFING

Chairperson: Ms O Kasienyane (ANC)

Documents handed out:
Department PowerPoint presentation: Integrated Work Plan 2005-2006
Department of Labour Work Plan 2005-2006

SUMMARY
The Department of Labour was scheduled to present its 2005/2006 Programme and budget. The Committee, however, requested that the Department only present its Programme. It wanted the Department to return, along with the Treasury, to present the budget.

The Department then presented the details of its Programme for 2005/2006. It planned to achieve the following: contributing to employment creation; improving skills development programmes; promoting equity; protecting vulnerable workers; strengthening social protection; promoting sound labour practices; increasing the capacity of its labour market institutions; monitoring the impact of labour legislation; and strengthening its own institutional capacity.

During the ensuing discussion, the Committee enquired about the Department’s capacity to deliver effectively, specifically with regards to its service delivery and its ability to conduct inspections. Members of the Committee were also concerned about the status of the Compensation Fund and whether SETAs were delivering. The Committee also requested information on the planned amendments to the Employment Equity Act and the establishment of the employment equity awards.

MINUTES
The Chairperson noted that the Committee had only received the Department’s budget documents on 25 February. They, therefore, had not had enough time to fully familiarise themselves with the budget figures. She requested that the Department, in conjunction with the Treasury, return at a later point to provide a thorough overview of the budget.

In the light of this, the Chairperson suggested that the Department specifically brief the Committee on their strategic plans and programmes and not the budget figures. She felt that the Treasury needed to provide the Committee with a future briefing on the budget figures, as it allocated the funds for the budget. This would allow the Committee to gain a thorough understanding of the budget.

Department briefing
Mr V Mkosana (Department Director-General) agreed to deal with the budget figures at a future Committee meeting. He and Mr G Msengiwe (Department Director of Human Resources) then outlined the Department’s vision, mission and programme of action.

It was noted that part of the Department’s mission for the next five years would be to promote a labour market, which would be conducive for economic growth, employment creation and investment. It was hoped that this would be achieved in an environment where sound labour practices and workers’ rights were respected.

Mr Tsengiwe then outlined the specifics of the programme of action for 2005/2006. In line with the Department’s vision, a ten-point programme had been produced. The Department would be:

1) Contributing to employment creation through various means, such as collaborating with the Expanded Public Works Programme. It would also strive to ensure targets of the Growth and Development Summit were met.

2) Enhancing skills development through such initiatives as the National Skills Development Strategy (NSDS). This would include monitoring the Sector Education and Training Authorities (SETAs) to ensure that they met their training targets, and that they provided relevant training. Indlela would also be tasked with providing new training services.

3) Promoting equity in the labour market. This would be achieved by ensuring broad based black economic empowerment and that employment equity was accelerated. The mechanism to monitor this would also be strengthened.
4) Protecting vulnerable workers. This would be achieved by ensuring employers complied with legislation through 200 000 workplace inspections in 2005/2006. It was hoped that 70% of those inspected would comply with relevant legislation within 90 days. The Department would also publish sectoral determinations in the welfare, sheltered employment, forestry and taxi sectors. A programme to ensure that children were not exploited as cheap labour would also be implemented. This would include establishing a Child Labour Desk. Sheltered employment factories would also be restructured.

5) Strengthening bilateral and multilateral relations with organisations such as the International Labour Organisation (ILO) and the African Union (AU) Labour and Social Affairs Commission. South Africa would also ensure that it met its ILO obligations, and it would also host the AU Labour and Social Affairs Commission.

6) Strengthening social protection. This would be achieved by strengthening the Occupational Health and Safety institutional framework to ensure effective implementation and monitoring. This would include identifying high-risk industries and training national roving teams of inspectors to enforce legislation in these industries. Reforms to the Compensation Fund would also be implemented. The administration of the Unemployment Insurance Fund (UIF) would also be improved. Civil society would also be strengthened through the Department supporting eight new projects that targeted vulnerable workers in remote rural areas. This would be linked to the Civil Society Fund.

7) Promoting sound labour practices.

8) Strengthening the capacity of labour market institutions. This would entail ensuring that all bodies and entities associated with the Department were effectively used.

9) Monitoring the impact of legislation. This would include conducting research into the labour market, collecting statistics and making sure that the information generated by the Department was distributed amongst interested stakeholders. The Department would also measure the impact of its policies on the labour market.

10) Strengthening the Department’s institutional capacity, which would include ensuring effective communication strategies were adopted. This would also include ensuring the Department's finances were effectively managed.

Discussion
The Chairperson and Mr S Rasmeni (ANC) asked what policy implications the Department’s programme would have for provincial and local governments. If policies did not filter down to the local level there would not be effective service delivery. The Chairperson and Mr Rasmeni also enquired whether the Department’s local labour centre employees were aware of its integrated work plan programmes.

Mr Tsengiwe noted that there were mechanisms to ensure that Department employees at local labour centres were familiar with the overall integrated work plan. Indeed, employees at local labour centres had been involved in the planning of the integrated work plan. They were, therefore, aware of the issues covered in the plan. Added to this, provincial and local labour offices would also be formulating their own work plans, which would be informed by the overall integrated work plan. The Department would also require reports from local labour offices on a monthly basis to ensure progress was being made in implementing the plans.

Mr Tsengiwe also commented that individual staff members had performance agreements, which were based on the criteria outlined in the overall integrated work plan. They were, therefore, expected to deliver on the objectives of the integrated work plan, and this would be monitored. There were also personal development plans to provide staff members with further training to ensure that they were capable of delivering on the integrated work plan programmes.

Prince N Zulu (IFP) asked why the Department had decided to become involved in the taxi industry. He thought it was the Department of Transport’s responsibility. He also enquired in which rural areas the Civil Society Fund was active.

Mr L Kettledas (Department of Labour) responded that the Department planned to establish minimum wages and conditions of employment for taxi workers. This was different from the Department of Transport’s role.

Mr Kettledas also answered that the Civil Society Fund was used by the Department to support initiatives, such as those that informed farm workers of their legal rights. These initiatives were taking place across the country.

Mr C Lowe (DA) noted that there was a problem with domestic workers accessing the UIF. Specifically, he highlighted that employers did not receive receipts for the payments that they had made to the UIF on behalf of their domestic workers. In some cases, when a domestic worker had wanted to claim UIF they had been refused because of a lack of payment records. He also noted that some mothers in the Western Cape had not received payments from the UIF for maternity leave.

Mr Kettledas responded by noting that there had been 27 333 UIF claims made by domestic workers in January 2005. This would suggest that domestic workers were able to access the fund. Most of the employers of domestic workers also often deposited the UIF payments directly into the UIF bank account. In these cases, the deposit slip was the proof of payment. It was currently not possible to supply everyone with a physical receipt. The Department was, however, considering implementing a computerised system that would provide physical receipts in the future.

Mr Kettledas also noted that there had been 6 584 maternity claims in January 2005. This again showed that pregnant women and mothers were accessing the UIF.

Mr Kettledas added that there was a new publicity campaign being conducted around the UIF and its benefits. The Minister had also conducted an Imbizo tour around the country to popularise the UIF.

Mr Lowe enquired whether the Department was currently meeting its targets. Added to this, he queried whether the Department had the capacity to effectively deploy its inspectors. Mr Lowe and Mr Rasmeni believed that the programme, outlined by the Department, could not function without adequate resources and staffing.

Mr P Mothiba (Department of Labour) replied that there had been a drastic increase in the ability of inspectors to visit companies. For example, in 2001/2002, 700 inspectors had carried out 60 000 inspections, but in 2003/2004 they had carried out 170 000 workplace inspections. This represented a dramatic increase in the performance of the Department in this respect. He also noted that the Department had conducted a resource and capability analysis to ensure that it had the requisite number of inspectors and employees.

Mr Lowe remarked that the success of the Department would be measured by the levels of unemployment in the country. If unemployment levels remained high, the Department would have failed.

Mr Lowe further enquired about how many people, who had been trained by the SETAs, found sustainable employment upon graduation. He also questioned how the Department planned to get more small- and medium-sized enterprises involved in providing their staff with skills training.

Mr Rasmeni enquired from which provinces the people who had received skills development training predominantly originated. Added to this, he questioned whether the Department was using the job creation targets set by the GDS or whether they had formulated their own targets.

The Committee also enquired how the Department tracked learners who had qualified from the SETAs. Linked to this, they asked how the Department was dealing with the problem of learners who were being repeatedly trained by different SETAs.

Mr Mkosana noted that the GDS had provided a unique opportunity for government, labour and business to plan how unemployment could be reduced. The GDS targets were, therefore, canvassed from a broad spectrum of society.

Mr Mkosana commented that the Department had targets for internships. However, it could not be responsible for employing people directly as a means of reducing national unemployment. Its role was rather to facilitate employment creation through policies and programmes. Institutions linked to the Department, such as the Commission for Conciliation, Mediation and Arbitration (CCMA), and the National Economic Development and Labour Council (NEDLAC) also had a role to play in facilitating job creation.

The Department also noted that it had commissioned research that examined the placement rates of SETA graduates. This would be informing the new NSDS. The new NSDS would also allow the Department to locate graduates geographically. The Department also planned to provide a report on the older NSDS: 2001 to 2005. This would include evaluations of the various SETAs, in terms of how many placements were achieved. However, other variables also effected how many graduates could be placed in employment, such as the national and international economy.

Mr Mkosana added that the Department had undertaken a study that tracked learners. It found that 70% of learners were placed in a position of employment upon the completion of training.

Mr Mkosana recognised that there was a problem with some people being repeatedly trained by different SETAs. This was because some people undertook many different courses in the hope of finding employment. The Department planned to reduce this by relating training to such programmes as the provincial growth development strategies. This would allow more of the training graduates to find sustainable employment.

Ms B Tinto (ANC) asked whether the Child Labour Desk would be situated in all the regions of the country or only a centralised national desk.

Mr Kettledas noted that the Child Labour Desk would be implemented at a centralised national level. There were, however, also structures at provincial levels that monitored child labour activities.

Mr Lowe wanted more information about the problems that the Compensation Fund was facing.

Mr Mothiba noted that there was an immense backlog at the Compensation Fund. Only 40% of the claims received were paid within 90 days. A new electronic management system would be introduced, which would allow claim times to be reduced and ensure proper records were kept. The Department was also in the process of appointing a provider that would aid in improving the service delivery of the Compensation Fund.

Mr Oliphant commented that when the Committee visited the Compensation Fund in 2002, they had been informed that an effective electronic system would be in place by 2003/2004. In the light of this, he questioned why it was currently necessary to implement a new system.

Mr Mkosana responded that the Department had attempted to implement the ‘For Your Information’ (FYI) computer system in 2002. Mr Mothiba noted that the company that developed the FYI system could not deliver the system according to the Department’s specifications. The FYI simply could not hold all the data. The Department was now looking to improve the FYI system.

The Chairperson noted that when she visited the North West province last year, there was a problem with the Skills Development Forum. She asked who was monitoring these provincial initiatives.

Mr Mothiba replied that the service delivery office of the Department monitored this. In future the Economic Development Department would also be involved.

Mr G Oliphant (ANC) and Mr O Mogale (ANC) noted that the recent SASOL accidents highlighted the weaknesses of the Department’s inspection services. It was important that these were improved, and that dangerous industries, such as the chemical industry, received regular visits from Department inspectors.

Mr Mothiba conceded that the SASOL accidents indicated that the Department needed to improve on its Occupational Health and Safety inspections. The Department’s 2005/2006 programme would aim at rectifying this. Specifically, a programme would be implemented that aimed to improve the capacity of inspectors to carry out Occupational Health and Safety inspections. The Department would also establish an Occupational Health and Safety Authority.

Mr Mothiba also noted that the Department would be conducting regular inspections of companies operating in the chemical industry.

Mr G Oliphant noted that multipurpose community centres were being established throughout the country. He enquired whether the Department was ready to deploy staff at these centres.

The Department stated that it was fully involved in the establishment of multipurpose community centres, and that it already had staff deployed at 80% of these centres.

Mr Oliphant then enquired whether service delivery agreements had been signed with the SETAs.

Mr Mkosana noted that when SETAs were given a certificate to operate, they were also provided with the criteria that they were expected to meet. This included the SETA complying with the service delivery agreements.

Mr Oliphant and Mr Mogale stated that proper statistics were needed on unemployment.

Mr Mkosana acknowledged that there was a problem with the reliability of unemployment statistics in South Africa. The Department had considered establishing an institute that would compile unemployment data and other labour market statistics. Presently, the Department was relying of Statistics South Africa (SSA) for information. SSA would also be improving the quality of its unemployment and labour market statistics.

Mr Oliphant noted that the Department intended amending the Employment Equity Act. He enquired what this would entail. He also wanted details on the AU Labour and Social Commission.

Mr Kettledas responded that the amendments to the Employment Equity Act would not be substantive amendments to the law. The amendments would rather be to the submission regulations. This would improve the quality of information that the Department was getting with regards to employment equity.

Mr Kettledas noted that South Africa would host the annual AU Labour and Social Affairs Commission meeting from 18 to 23 April in Johannesburg. The Commission would consist of all 53 member states of the AU. It would discuss labour and social issues. The meeting would also allow for a common African position to be formulated on the issues that would be discussed at the ILO conference in June.

Mr L Maduna (ANC) enquired about what happened to the adult learners who had completed Level 4 of the Adult Basic Education Training (ABET) programme: did they study further, or did they find employment, or did they remain unemployed?

Mr Mkosana replied that an exit strategy was in place for ABET learners who had completed Level 4. They would either be employed, self-employed or study further.

Mr Maduna enquired whether the Department had adequate resources to conduct long distance inspections.

Ms N Xaba (Department of Labour) answered that the Department was dealing with long distance inspections by ensuring that it had access to four-wheel drive vehicles. Mr Mkosana added that the Department would be implementing mobile labour units to service remote rural areas. Indeed, it was hoped that 20 would be operational by the end of March.

Ms D Ngcengwane (ANC) and the Chairperson felt that often East Asian employers in South Africa exploited their employees. They enquired what the Department was doing to prevent this and to ensure that these employers complied with labour legislation.

Mr Kettledas replied that the Department was involved in initiatives that were aimed at protecting vulnerable workers who were employed by some East Asian owned companies. Specifically, there was a process underway in Newcastle, KwaZulu-Natal, where a number of Chinese and Taiwanese employers were issued with compliance orders, and were being forced to comply with labour legislation.

Ms Ngcengwane felt that often consultants and trainers in the SETAs benefited more than the learners. Similarly, in the case of workplace accidents, the doctors often seemed to benefit more than the injured workers from the Compensation Fund.

Mr Mothiba responded that that this was an issue that was currently being considered by the Department. He stated that perhaps doctors were benefiting more than injured workers because of high medical costs.

Mr V Godi (PAC) noted that the Department had stated that there had been an increase of 5% in the compliance of companies with labour legislation. He asked whether this 5% increase was part of the planned 70% compliance level. How did the Department come to the figure of 5%?

Mr Mothiba noted that the 5% increase was part of the 70% compliance level.

Mr M Mzondeki (ANC) asked what criteria companies had to meet in order to receive an employment equity award. He also enquired about the strategy for reassessing the sheltered employment sector.

Mr Ketteldas stated that the Commission on Employment Equity would be presenting the awards. The companies that would be awarded were those that had truly transformed the workplace. The first awards would be given later in the year.

Mr Mkosana stated that a transaction adviser had been appointed to examine the restructuring options that existed for the sheltered employment factories. It would consider whether these factories should be commercialised or placed in other departments.

Mr Rasmeni enquired about the vacancy levels in the Department. He also asked what the Department was doing about filling these vacancies.

Ms Xaba stated that there were 643 vacancies in the Department.

Mr Maduna noted that the Department had stated that it would identify future SETA learners from its unemployment database. Many people in the remote rural areas were not on this database. He was, therefore, concerned that they would be overlooked.

The Chairperson and Mr Mkosana felt that the establishment of multipurpose community centres and the mobile labour units in rural areas would help alleviate this possible problem. Mr Mkosana also noted that the Department was training employment service practitioners who would inform people in remote rural areas about the services offered by the Department.

The meeting was adjourned.