Accelerated Shared Growth (ASGISA) Progress & Remuneration of Public Servants: Department briefings

PUBLIC SERVICE AND ADMINISTRATION PORTFOLIO COMMITTEE
5 September 2007
ACCELERATED SHARED GROWTH (ASGISA) PROGRESS & REMUNERATION OF PUBLIC SERVANTS: DEPARTMENT BRIEFINGS

Chairperson: Mr P Gomomo (ANC)

Documents handed out
MOC Portfolio Committee: 2006 Personnel Expenditure review
Public Service Response: Progress Report

ASGISA: The Public Service Response: Progress Report

Audio recording of meeting

SUMMARY
The Department of Public Service and Administration briefed the Committee with an update on the Accelerated Shared Growth Initiative of South Africa (ASGISA) and on issues around the proposed Remuneration Policy for public servants, the human resources development strategy, and the recent public servants’ strike. With regard to ASGISA, the achievements were outlined. Fixed investments had grown; and overall public sector infrastructure expenditure had increased in the 2006/07 financial year. More infrastructure projects were to be carried out and funds for this had been set aside. A significant number of jobs had been created, with the Gautrain project contributing 58 000 alone. Education and skills sectors would benefit through funding for indigenous language material, and teacher training in mathematics and science. A number of professions and areas of improvement were identified as needing attention to address the current skills shortages. The Department’s recommendations included forming partnerships with the private sector, both to deal with skills shortages and increase the flow of talent to the public sector, internships, identification of specific areas of training and new strategies for recruitment and retention. The anticipated Single Public Service legislation would be aligned with the objectives of AsgiSA, and the constraints would be addressed. 

The new remuneration policy and human resource development initiatives were outlined. The Department stated that a plan and corrective measures on remuneration for a number of professions in the sector were under way, and would be implemented by 2008/09. It outlined shifts in government expenditure over the past decade, noting that personnel spending had decreased in comparison with other areas. There was a need to address discrepancies in public and private sector funding, to raise the status and pay of professionals, and to set caps and performance indicators. The Department also alluded to the recent public service strikes, noting that the issues could have been better handled and there was a need to address picketing and strike conduct and other matters before the next wage negotiations. Rules to address practical issues would be drawn. The Department committed itself to ensuring that in future, there should be greater effort into explaining and understanding the positions of both parties in wage negotiations, to implement agreements promptly and to try to narrow down the bargaining issues. Only two questions could be asked due to shortage of time, and the Chairperson ruled that these questions and other issues would be addressed in a subsequent meeting.

MINUTES
Accelerated Shared Growth Initiative for South Africa (ASGISA) Update: Department of Public Service and Administration (DPSA) briefing
Mr Kenny Govender, Deputy Director General, DPSA, noted that the Department’s report would focus on  matters that were important to the public service. These were Education and Skills, HR Connect (human resources), HRD (Human Resource Development) Strategic Framework, Capacity assessments and Single Public Service.

Some of key objectives of ASGISA were to achieve economic growth by 6% per year by 2010, to
halve unemployment by 2014, and to halve poverty by 2014.

To achieve the objectives of ASGISA there was a need to address some key constraints in the economy. These included the relative volatility of the currency, the cost, efficiency and capacity of the national logistics systems, shortages of suitably skilled labour, and barriers to entry, limits to competition, the regulatory environment, and deficiencies in state organisation, capacity and leadership. Some broad policy areas had been identified as main pillars for ASGISA to accelerate economic growth, including macroeconomic issues, infrastructure investment, education and skills development, industrial and sector strategies, second economy Initiatives, governance and State capacity Issues.

A number of achievements of the programme so far were noted. Gross Domestic Product had grown 4.9% in 2006, there was a small budget surplus, the gap between budget and expenditure was narrowing, and the percentage of capital projects behind schedule fell to 4% in 2006. the infrastructure investment was summarised. A brief update on ASGISA was given. It was noted that construction was started on Phase One of the Gautrain and about 58 800 direct jobs would be created. The 2006 budget allocated R 3 billion for stadium construction and R2.4 billion for transport infrastructure. A further R9.5 billion was announced in the MTEF, half for building five new stadiums and half for upgrading five existing ones. About R15 billion was earmarked for Extended Public Works Programmes (EPWP) for the next five years and pilot programmes had created over 47 000 jobs.

Under education and skills development, the School Quality Improvement and Development Strategy was in place to improve quality of teaching in poorest primary schools. 6000 schools would receive indigenous language material to improve literacy. The programme also targeted teacher training and development in Maths, Science and Technology skills. The aim was to increase the number of learners passing Maths and Science in higher grades from previously disadvantaged groups, and 47 530 jobs were created in 2005/06. The Joint Initiative for Priority Skills Acquisition (JIPSA) had identified that urgent attention should be given to the professions of high level planning and engineering skills, town and regional planners, engineers and technologists, and artisans. It also identified the need for  mathematics, science and ICT in schools, planning and management skills for the public education and healthcare systems, cross-cutting skills in project management, ICTs, finance and Adult Basic Literacy. Infrastructure maintenance and construction had created around 70 000 full-time jobs.

In the second economy, it was noted that infrastructure maintenance and construction had created around 70 000 full time jobs. Early Childhood Development (ECD) and Home-based care systems should create 72 000 permanent jobs and 205 000 part-time jobs by the end of 2007. Working for Water had created 27 000 short term jobs. The Umsobomvu Youth Fund had a job database that currently placed 500 people a year and would expand to 2000 in the future.

Overall, across government, there was marked acceleration of service delivery by deploying scarce skills. Growth envisaged through ASGISA depended in part on resolving the shortage of suitably skilled labour, and thus a number of medium and long term interventions had been identified. The four measures for implementation were supporting the flow of talent into the public service, building a developmental ethos in the public service, the coordination and strategic focusing of resources, and improving systems and processes.

In order to close the skills gaps in the public service, DPSA needed to support the flow of talent, and develop the public service. There was an urgent need to conduct proper reorientation and induction programmes for newly recruited public servants. It was equally important to increase internships to reduce graduate unemployment and to introduce graduates to the public sector ethos. A key area of improvement lay in improving certain learnerships to provide career pathing and employment for the unemployed and under qualified. Links with the private sector for revolving door, secondments and other mechanisms. to enable flows of personnel between private and public sectors, and building on current international exchange programmes were also of importance.

Targeted partnerships were in place with private sector service providers as a temporary measure to fill immediate skills gaps. A designated mechanism to facilitate relationships would be created. Some structure should be established so that education institutions and government could work more closely towards meeting public sector training needs. There was a need to facilitate bridging skills for professionals to prepare them for entry into the public service.

Government departments had worked together on a cross-government skills agenda and government and its agencies were working together well to deliver. A presentation to Cabinet would be made in September 2007 and a launch of the Human Resource Development Strategy would take place in November 2007. A roll out plan in 27 departments was proposed for November 2007 to January 2008 followed by all departments from January to March 2008. The plans must be fully implemented in the 2008/09 year.

AsgiSA and the second economy initiatives required a re-engineered public service, which meant innovative thinking and seamless service delivery, including the use of ICT; and a multi-skilled, flexible, adaptable and versatile public service, which was capable of implementing its policies. Strong leadership, skills development, public administration and management reform and integrated planning were important. All spheres of government must better integrate and share responsibility for service delivery functions. There must be a review of regulatory and administrative systems to ensure better alignment and use of batho pele principles.

Work on the implementation of the Single Public Service was progressing and would be facilitated by legislation, that had already been drafted and approved by Cabinet for public consultation.  Access and e-Gov Strategic Frameworks were in place. Human resource practices, remuneration and conditions of service in all three spheres of government were being investigated, and a costing exercise was under way. Anti corruption frameworks had been developed.

Personnel Expenditure Review Briefing  by the Department of Public Service and Administration (DPSA)
The DPSA gave a separate presentation on the Personnel Expenditure Review (PER) for 2006, the recruitment and retention priorities, and negotiations and labour relations in relation to the remuneration strategies.

The presentation reflected on the progress made with the implementation of the 1999 PER recommendations, analysed employment and personnel expenditure trends, revised the current Public Service remuneration framework, and submitted recommendations to inform the development of a new Public Service remuneration policy framework. It was noted that between 2001 and 2005 employee numbers in the public service had risen by 4.65%. Personnel expenditure decreased from 36.8% of total expenditure, during 2001/02 to 32.8% in 2005/06. There was in fact a real increase in the numbers, but in relation to other expenditure it was lower, because of a policy shift that put more money into social and capital investment.

DPSA found that there was scope for upward movement in personnel expenditure. Significant shifts in the relative priorities of government expenditure over the past decade had led to a lowering of expenditure on personnel. DPSA recommended that the remuneration of professionals, other specialists and scarce skill occupations should be a priority area and there must be a maximum cap on remuneration. The principle of a “total cost to employer” remuneration system should be considered. This should be underpinned by an appropriate evaluation system and establishment of a review panel to review remuneration of Senior Managers. Remuneration and careers related issues for Directors General and Heads of Departments must be addressed. Career pathing arrangements, especially dual career paths for professionals and other specialists, should be considered. Performance management must be improved, with greater emphasis on performance related pay. Macro benefits were to be maintained and further strengthened where required. The DPSA further recommended that allowances should as far as possible be reviewed and rationalized, and, where justifiable, incorporated into salary. Affordability was also a key consideration. The policy framework must aim to ensure stable labour relations; and should be transparent, fair and easy to administer. It should incorporate development and implementation of compensation policies, guidelines and related systems to attract, recruit and retain high calibre and skilled employees. It must also seek to develop and maintain the management system and ensure a coordinated bargaining process at the relevant bargaining councils. Full details on certain sectors were included in the attached presentation.

DPSA then outlined the structures to support the strategy. In regard to remuneration, the policy had been developed and approved by the Mandate Committee. Specific occupations and different implementation periods were identified. The presentation focused also on the collective bargaining and strike action, higlighting the recent public service strike. It was noted that although the Public Service Amendment Act had initiated technical amendments and clarification of ambiguities it was not necessarily intended to deal with collective bargaining process in public service. The right to strike was recognized as a constitutional right and could not be limited through policy. Trade unions wished to broaden strike action through minimum service agreements in respect of essential services.

The DPSA also focused on conduct during strike action. DPSA recommended that picketing and conduct during strike must be agreed in the period before the next wage negotiations. There would be rules to address practical issues, for example the number of picketers, distance from entrances and so on, but also issues of conduct (placards, songs, statements). The success of collective bargaining process depended on the attitude and approach of bargaining partners. DPSA committed itself to ensuring that in future there would be a greater effort in explaining and understanding the positions of both parties. There was also a need to build relationships, for prompt and effective implementation of agreements, and the narrowing down of bargaining issues.

Discussion
There was only time for two questions to be asked.

Ms V Mentoor (ANC) asked the department to clarify more on the issue of its job evaluation system.

Mr N Gcwabaza (ANC) asked the department about the recent public service strike and why it was that the negotiation process took so long. He also wanted the Department to reflect on that process, and respond as to whether it could have avoided the problems and what could have been done differently.

The Chairperson noted that the presentations had taken more time than expected. The venue had been booked for another meeting and there was no time to deal with the many issues. A further date would be arranged when these and other issues could be addressed.

The meeting was adjourned.