Department of Labour Annual Report briefing
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Meeting report
PORTFOLIO COMMITTEE ON LABOUR
23 October 2007
DEPARTMENT OF LABOUR ANNUAL REPORT BRIEFING
Chairperson: Ms O Kasienyane (ANC)
Documents handed out:
Department of Labour
Annual Report Presentation
Department of Labour Annual Report [available at www.labour.gov.za]
Audio recording of
meeting
SUMMARY
The Department of Labour briefed the Committee on its Annual Report. The
Chairperson announced that this meeting would take the format of presentation
of the Report, followed only by questions of clarity. The Committee would
consider the report but would be hearing comments also from stakeholders on the
Report, and would arrange a subsequent meeting at which the Members could ask
detailed questions of the Department. The briefing set out the main
achievements in respect of service delivery, noting the statistics for
finalisation of claims against the Unemployment Insurance Fund, the
Compensation Fund and the Employment Services System. Sector Education and
Training Authorities applicants and learners were being matched through the new
database to employment opportunities. Details were given of financial support
and training, as well as workplace inspections. The financial statements and
figures for the various programmes were tabled. Detailed descriptions were
given of achievements in specific programmes.
The financial statements were then tabled, and this showed 2.7% under spending.
Transfers and subsidies showed under-transfers of R6 million against R410
million transferred. The Auditor General’s three reports covered the
Department, the Sheltered Employment Factories and the National Skills Fund. All
three had received qualified reports. The qualifications for each were set out,
together with a note of the corrective action taken.
There were no questions asked by Members, only a comment that the Department
should be prepared to indicate the areas in which it had achieved improvements
since the last report.
MINUTES
Department of Labour (DOL) Annual Report 2006/07 Briefing
The Chairperson welcomed the Department and thanked them for inviting the
Committee to the National Skills Conference.
The Chairperson said that this meeting would differ from others, since Members
of the Committee would listen to the presentation on the annual report and only
ask questions of clarity. After hearing the Department’s Annual Report
presentation the Committee would be inviting stakeholders also to talk to the
Report and then schedule another meeting where the Committee would ask detailed
questions.
Mr Les Kettledas, Deputy Director General, DOL, apologised that the Director
General could not attend the meeting since he was out of the country. He began
the presentation by introducing the achievements on service delivery by the
Department, noting that 88% of the Unemployment-Insurance Fund (UIF) claims had
been processed and paid within six weeks of receipt of completed documents. 35% of
Compensation Fund claims were processed and paid within 90 days. Phase 1 of the
Employment Services System was completed and being implemented, and had
identified the Sector Education and Training Authorities (SETAs) and matched
applicants with available jobs or skills development opportunities.
2 637 projects were identified for support, and 88% were supported through
skills development across the provinces. Training was given to 118 153
unemployed people, of
whom 77% had been placed. Breakdowns by
province were provided for those retrenched people who had been registered, counselled and
referred for training. Figures were included for youth trained and placed
across the provinces. The DOL also attended to workplace inspections, and 76%
had been found compliant with requirements.
97% of labour complaints were settled within 90 days. Over 5000
workplaces identified as high risk were inspected.
The Occupational Health and Safety bill had been finalised.
Mr Kettledas tabled the expenditure and commitments in respect of various
programmes. R2.2 billion was allocated to skills development, and 81% had been
used to pay 27 providers to train 20 000 unemployed learners in Adult Basic
Education and Training programmes. R10
million was budgeted for the printing of guides and training of career guidance
counsellors. R316 million grants for bursaries to over 10 000 students was
given, and
R78.5 million was allocated for funding of undergraduate and postgraduate
students.
Mr Kettledas indicated that all 23 SETAs had signed service level agreements
and performed satisfactorily against set targets, as detailed in the
presentation. Strategic projects to the
value of R886 million were initiated to support provinces over the next three
years.
Detailed descriptions were tabled for the achievements in the administration
communications strategy, the labour market policy (LMP) and labour project (LP)
in process of welfare sectoral determination, including an explanation that the
sample for testing was found to be very broad and the activities had been
extended into the next financial year. The child labour activities and projects
received focus. The funding to the National Economic Development and Labour
Council (NEDLAC) was described.
Mr Kettledas went on to describe the particular achievements in each of the
programmes for administration, human resource management, the monthly and
quarterly reporting systems
Mr C van der Merwe, Chief Financial Officer, DOL, tabled the financial
statements were tabled. He noted that there was 2.7% under spending (R39
million) on the budget. The highest
expenditure was on service delivery and there was under spending on social
insurance. The transfers and subsidies amounted to R410 million transferred,
showing an under variance of R6 million.
The Auditor General’s (AG) Report was encapsulated in three parts, Department
of Labour, sheltered employment factories and the National Skills Fund. The
part relating to the DOL was qualified in respect of asset management.
Corrective action had been taken by implementing an asset management unit and
reconciling the registers. The difficulties here had arisen because of
insufficient time to complete the tasks. There was an emphasis of matter
relating to administration of leave records where the Department had put in
corrective measures. There was a problem in staff debtors amounting to R10.2
million and the Department was in the process of recovering those debts. The
South African Police Service and various tracing agencies had been used to
assist in tracing, but if people remained untraced the matter would be referred
to the State Attorney for advice. There was insufficient monitoring of the
salary PERSAL control account, and the Department would improve its actions to clear
the account. The Department had not yet complied with the requirement to
produce an environmental management plan, which was in the draft stages. There
was insufficient documentation in relation to the internal audit, and reliance
could not be placed on the internal audit. A Risk Management Unit had been
appointed.
There was also a qualified audit report for the Sheltered Employment Factories.
The qualifications here related to the non-following of processes for supply
chain management, but corrective measures had now been taken to advertise for
alternative supplies on a periodic basis. The impairment of fixed assets
exercise was not completed and corrective measures implemented here had
resulted in 60% now being completed, with the remaining five factories still
being done. There was no disclosure on stock in transit at year end, but
correctional measures had been taken to monitor, and documents had been sent to
the AG. Risk assessment and non-compliance with applicable legislation were
also raised, and corrective measures were now in place. The strategic plan was
not achieved in relation to matters of governance.
The National Skills Fund had also received a qualified report. The
qualification related to the project expenditure and the NSF had undertaken a
detailed analysis of processes against the qualification, and would be aligning
the requirements, policies and processes. The other qualification related to
reflection of commitments, and the accrual based accounting system would be
implemented. The Department
had taken note of the emphasis of matter on the basis of
accounting, the governance issues, material corrections, preparation of
manuals, and the internal audit.
Discussion
The Chairperson noted that there were areas of concern that would be addressed
later in detail. However, the current questions would be for clarity only.
Mr M Mzondeki (ANC) requested that when the Department presented to the
Committee again it should indicate the areas of improvement since the last
report.
The meeting was adjourned.
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