ATC140716: Report of the Portfolio Committee on Science and Technology on Budget Vote 34 and the Annual Performance Plan of the Department of Science and Technology for the 2014/15 Fiscal Year, dated 10 July 2014:

Science and Technology

Report of the Portfolio Committee on Science and Technology on Budget Vote 34 and the Annual Performance Plan of the Department of Science and Technology for the 2014/15 Fiscal Year, dated 10 July 2014:

The Portfolio Committee on Science and Technology, having considered and concluded its deliberations on the 2014/15 Annual Performance Plan and Budget Allocation of the Department of Science and Technology ,reports as follows:

1. Introduction

The Portfolio Committee on Science and Technology (the Committee) received two briefings (2 and 9 July 2014) by the Department of Science and Technology (the Department )on the 2014/15 Annual Performance Plan (APP) and budget allocation.

During the first briefing, the Director-General, Dr P. Mjwara , provided an overview of the strategic context within which the Department functions, detailing its policy mandate and key priorities. Furthermore, the Department highlighted a selection of performance indicators and their concomitant targets to reflect what it aims to achieve with each of its programmes. The presentation also listed the budget allocations for each of the programmes and entities over the medium term expenditure framework (MTEF).

During the second briefing, the Department provided the Committee with more detail as to its 2014/15 performance targets and budget allocation.

2. Strategic Overview

The Department aims to realise the full potential of science and technology (S&T) in social and economic advancement through the development of human resources, research and innovation. The Department executes this mandate by implementing the 1996 White Paper on Science and Technology, the 2002 National Research and Development Strategy (NRDS) and the Ten Year Innovation Plan (TYIP). The White Paper introduced the concept of a National System of Innovation (NSI) as an enabling framework for the development and application of S&T in South Africa. Within this framework, Government (with the line department being the Department of Science and Technology) has the sole responsibility for, at the national level, policy formulation and resource allocation; and for regulatory policy-making.

The NRDS and the TYIP are the key drivers of the NSI. The TYIP, particularly, was put in place to guide the country towards a knowledge-based economy through human capital development, knowledge generation and exploitation, knowledge infrastructure and enablers to convert knowledge into socio-economic outcomes. The grand challenges outlined in the TYIP; comprising the bio-economy, space science, energy security and global change; aim to foster multidisciplinary thinking amongst South African researchers to address national challenges in an innovative way that would ensure socio-economic benefit as is envisaged in both the National Development Plan (NDP) and the National Growth Path (NGP).

The NDP identifies S&T as a key driver of economic change. The NGP requires infrastructure to support it and the Department plays a supporting role in various strategic integrated projects (SIPs) that form part of the National Infrastructure Plan. The Department is involved in three of the 18 SIPs; namely, SIP 14 (Higher education and infrastructure), SIP 15 (Expanding access to communication technology) and SIP 16 (Square Kilometre Array [SKA] and MeerKAT ). The Department also contributes to Outcome 2 “a long and healthy life for all South Africans”, Outcome 4 “decent employment through inclusive economic growth” and Outcome 5 “a skilled and capable workforce to support an inclusive growth path” of Government’s 12 Key Outcomes.

3. Budget Allocation – Vote 34: Science and Technology

The overall budget allocation of the Department increased from R6.2 billion in 2013/14 to R6.47 billion in 2014/15. Over the medium term, the budget allocation will increase to R7.5 billion in 2015/16 and R7.6 billion in 2016/17(Table 1) and spending will focus on developing science, technology and innovation (STI) human capital; the generation and exploitation of knowledge; investing in research and development infrastructure; strengthening regional, continental and international co-operation in STI; and encouraging South African innovation by funding marketable products emerging from research and incubation. Hence, 92 per cent (R5.98 billion) of the Department’s budget will be spent on Transfers and subsidies.The allocation for Transfers and subsidies further comprises R4.3 billion for the Department’s agencies and science councils, R1.2 billion for Public corporations and private enterprises, R438 million for Non-profit institutions and R15 million for Higher education institutions.

Table 1: Medium term budget allocation of the Department of Science and Technology


R’ million





Rand change

2013/14 – 2014/15







Technology Innovation

1 122.1


1 018.5

1 023.1


International Cooperation and Resources






Research, Development and Support

3 233.8

3 503.8

4 300.1

4 323.7


Socio-Economic Innovation Partnerships

1 486.4

1 564.1

1 801.3

1 850.6


Total expenditure estimates

6 198.2

6 470.2

7 554.3

7 634.8


4. Overview of the Purpose, Spending Focus and Selected Performance Targets of the Programmes and Entities of the Department

A reorganisation of the Department’s programme budget structure in 2014/15 sought to incorporate the recommendations of the 2012 Ministerial Review Committee Report on the Science, Technology and Innovation Landscape in South Africa. The name changes are reflected in Table 2. The entities are listed with the Programmes from which they are funded.

Table 2: Programme structure of the Department of Science and Technology

Old Programme Name

New Programme Name

Programme 1: Administration


Programme 2: Research, Development and Innovation

Technology Innovation

Programme 3: International Cooperation and Resources


Programme 4: Human Capital and Knowledge Systems

Research, Development and Support

Programme 5: Socio-Economic Partnerships

Socio-Economic Innovation Partnerships

Programme 1: Administration

Programme 1 remains unchanged. The purpose of Programme 1 is to conduct the overall management and administration of the Department and ensure that the organisations funded by the Department comply with good corporate governance and that their activities are aligned with the strategic focus of the NSI. It also monitors and evaluates the performance of the science councils. This programme has five sub-programmes, i.e., Ministry, Management, Corporate Services, Governance and Office Accommodation. Of the total appropriation of R6.47 billion, R291.0 million will be spent on Programme 1, mainly on compensation of employees (R137.0 million) and on goods and services (R139.5 million). Due to a lack of management advisory services skills within the Department, expenditure on consultants is expected to increase over the medium term.

Funding for the National Advisory Committee on Innovation (NACI) is allocated within this programme.Its mandate is to generate and deliver clear, evidence-based and autonomous advice to the Minister of Science and Technology and through her, the government of South Africa, on the role and contribution of innovation in promoting and achieving national objectives. NACI’s advisory services are directed at, amongst others, the:

• Coordination and stimulation of the NSI;

• Development and maintenance of human resources for STI;

• Revision of the innovation policy to ensure coherence;

• Strategies or models for the promotion of all aspects of technological and non-technological innovation;

• Funding of the S&T system;

• Identification of research and development priorities in consultation with provincial departments and other interested parties;

• Establishment, phasing out, rationalisation and management of science councils and national research facilities;

• Establishment and maintenance of STI indicator systems; and

• International liaison and co-operation in STI.

Programme 2: Technology Innovation

Programme 2 has changed from Research, Development and Innovation to Technology Innovation to reflect that the Department needs to improve the innovation capacity of the NSI. The emphasis for Programme 2 now is not on knowledge generation per se, but rather more on knowledge exploitation and the commercialisation thereof. Hence, the purpose of Programme 2 is to promote the realisation of commercial products, processes and services from research and development (R&D) outputs, via the implementation of enabling policy instruments. This programme has five sub-programmes, i.e., Space Science, Hydrogen and Energy, Bioeconomy , Innovation Priorities and Instruments (IPI) and the National Intellectual Property Management Office (NIPMO). The spending focus over the medium term will be on the IPI sub-programme to support the policy of creating an enabling environment for innovation, technology development and the commercialisation of publicly financed R&D initiatives. The allocation to the IPI sub-programme constitutes 52 per cent (R517.3 million) of the total budget (R991.6 million) allocated to this programme.

Sixty four (64) per cent (R635.6 million) of Programme 2’s budget constitutes Transfers and subsidies to departmental agencies and accounts. The agencies receiving the bulk of the funding within this Programme are the Technology Innovation Agency (TIA) (R380.7 million) and the South African National Space Agency (SANSA) (R118.3 million). The TIA serves as the key institutional intervention to bridge the innovation chasm between R&D and technological innovation. Even though there is a decrease in budget allocation for the TIA from R481.1 million in 2013/14 to R380.7 million in 2014/15 due to slower than expected spending, the Department does not expect that the reduction will impact on service delivery. The spending focus over the medium term will include stimulating the development and commercialisation of technology based services, processes and products; supporting the development of technology enterprises; and establishing a technology innovation culture. The Committee still has to be briefed on the outcomes of the 2013 forensic investigation into the management and operations of TIA as well as the progress made with implementing the recommendations of the 2013 TIA Review Report. The TIA has been the cause of the Department not achieving some of its performance targets in the past few years. This was due to a misalignment of TIA’s objectives with those of the Department. This anomaly and the reasons for it arising needs to be monitored closely in future.

The mandate of SANSA is to promote the peaceful use of space, foster international cooperation in space related activities and facilitate the creation of an enabling environment for the development of a space technology industry. Despite SANSA being allocated less funding in 2014/15, the overall funding over the MTEF is slightly more (R367.7 million) than what was allocated over the previous three years (R356.4 million). The spending focus over the medium term will be on space research; space systems development; the development of an earth observation satellite; and the acquisition, maintenance and distribution of satellite imagery and space weather data.

The key performance indicators for this Programme, as highlighted during the Department’s second briefing presentation, included:

· Development of sixnew technology innovation products in key strategic areas (Space science, Energy, Indigenous Knowledge Systems (IKS) and Photonics) by 31 March 2015.

· Production of sixpost -graduate students (MSc and PhD) in key strategic areas by 31 March 2015.

Programme 3: International Cooperation and Resources

Programme 3 remains unchanged. The purpose of Programme 3 is to develop, promote and manage international relationships, opportunities and S&T agreements that both strengthen the NSI and enable an exchange of knowledge, capacity and resources between South Africa and its regional and international partners.This programme has three sub-programmes, i.e., Multilateral Cooperation and Africa, International Resources and Overseas Bilateral Cooperation. Of the R119.7 million allocated for this programme, almost 46.6 per cent (R55.0 million) is transferred to non-profit institutions. The other portion of the funds, 36.2 per cent (R43.4 million) is allocated to compensation of employees and 18.1 per cent (R21.7 million) to goods and services. Of the half that is allocated to non-profit institutions, R33 million is for International Resources, R13 million is for Bilateral Cooperation and R8.1 million is for African Multilateral agreements.

The spending focus over the medium term is on engagements with the European Union (EU) and managing bilateral relationships and Africa-to-Africa engagements. Most of the funding is channelled towards international human capital development opportunities to allow South African researchers to participate in these opportunities.

The key performance indicators for this Programme, as highlighted during the Department’s second briefing presentation, included:

· Securing of R354.6 million of foreign STI funds from international partners through leveraging with local funds by 31 March 2015.

· Creation of 44 international human capital development opportunities accessed for participation by South African researchers and students by 31 March 2015.

Programme 4: Research, Development and Support

Programme 4 has changed from Human Capital and Knowledge Systems to Research, Development and Support to reflect that it is now dedicated purely to knowledge generating activities and particularly to human capital development and the modernisation of the S&T research infrastructure in South Africa. This Programme has four sub-programmes. The Human Capital and Science Platforms sub-programme becomes Human Capital and Science Promotions to reflect the emphasis on the promotion of human capital development. The Emerging Research Areas and Infrastructure sub-programme has changed into Basic Sciences and Infrastructure to focus on the provision and implementation of research and innovation equipment and infrastructure to promote knowledge production. This area needs attention especially in the high-end sciences. The Astronomy sub-programme, which is more in line with knowledge generation activity ,was moved into this Programme from Programme 2. The IKS sub-programme has been moved from Programme 4 into Programme 2 under the Bioeconomy sub-programme to reflect the inclusion of IK-based technologies in the Bioeconomy Strategy.A new Science Missions sub-programme has been added to promote research in areas in which South Africa enjoys a geographical advantage. These areas of research are climate change, Antarctic and marine research, palaeosciences and IKS.

Programme 4 has performed fairly well in the past and is expected to perform even better now that the innovation activities related to IK-based technologies have all been migrated into the more fitting Programme 2 under the Bioeconomy sub-programme.

Programme 4receives more than half the budget of the Department, an indication of the commitment to develop human capital and research infrastructure for the NSI.The biggest expenditure item under this Programme is toward Human Capital and Science Promotions (R1.87 billion). A sub-programme aimed at formulating and implementing policies and strategies that address the availability of human capital for the STI sectors of the economy.More funds will be directed at increasing the number of and bursary stipends awarded, especially in the fields of astronomy, archaeology and palaeontology. Over the medium term, the budget allocation for R&D infrastructure has increased from R980.9 million to R2.12 billion. The SKA has also been allocated a substantial amount of funds (R2.05 billion) to advance radio astronomy in the country.

The entities funded under Programme 4 are the National Research Foundation (NRF) and the Academy of Science of South Africa ( ASSAf ). The NRF is allocated R2.2 billion and its mandate is to promote and support research in all fields of science. The NRF also provides research funding and platforms through national facilities and science engagement activities. The Academy is allocated R21.6 million and its mandate is to promote outstanding achievement in all fields of scientific enquiry and provide evidence-based scientific advice to government and other stakeholders.

The key performance indicators for this Programme, as highlighted during the Department’s second briefing presentation, included:

· Awarding of 11 440 post-graduate students (3 414 Btech and Honours, 4 671 Masters, 665 PhD and 690 post-doctoral fellows with bursaries by 31 March 2015.

· Production of 5 700 research articles by NRF-funded researchers, published in Institute for Scientific Information (ISI)-accredited journals by 31 March 2015.

Programme 5: Socio-Economic Innovation Partnerships

Programme 5 changed from Socio-economic Partnerships to Socio-Economic Innovation Partnerships to include the innovation element in research that has the potential to impact positively on socio-economic development. This programme has four sub-programmes. The functions of the former Science and Technology for Economic Impact sub-programme were split between two new sub-programmes. These new sub-programmes are Technology Localisation Beneficiation and Advanced Manufacturing, and Sector Innovation and Green Economy. The former Science and Technology for Social Impact sub-programme becomes the Innovation for Inclusive Development sub-programme, but the mandate has stayed the same. The Science and Technology Investment sub-programme has not changed.The purpose of Programme 5 is to enhance the growth and development priorities of Government through targeted STI interventions and the development of strategic partnerships with all levels of government, industry, research institutions and communities.

More than half (54 per cent) of the total allocation (R1.56 billion) for this Programme is dedicated to the Sector Innovation and Green Economy sub-programme. This is expected to establish high-impact science research that would support the growth of environmental technologies and services in South Africa. The Technology Localisation, Beneficiation and Advanced Manufacturing sub-programme has been boosted with more funding over the medium term (R1.41 billion) compared to the previous three years (R570.8 million). Although the Department achieved most of its targets in 2012/13, it hadfailed to achieve certain targets that are crucial to economic growth and job creation. These include (i) not reaching its targets regarding the number of technology-based enterprises supported per year and (ii) not reaching its targets regarding the number of small and medium enterprises provided with technology support per year.

The entities funded under Programme 5 are the Council for Scientific and Industrial Research (CSIR) (R825.7 million) and the Human Sciences Research Council (HSRC) (R276 million).The HSRC’s budget has remained the same year on year, but increases by about a R100 million over the medium term. The HSRC’s mandate is to undertake, promote and coordinate research in the human and social sciences. The CSIR budget has slightly increased from R2.21 billion in the previous 3 years to R2.52 billion over the medium term. The CSIR’s mandate is to foster industrial and scientific development in the national interest through multidisciplinary research and technological innovation.

The key performance indicators for this Programme, as highlighted during the Department’s second briefing presentation, included:

· Funding 10 Masters and Doctoral students in designated niche areas (sustainable development, the greening of society and the economy) by 31 March 2015.

· Support of eightinstruments related to localisation, competitiveness and R&D-led industry development by 31 March 2015.

5. Committee Observations

1. The Committee accepted the apology from the Minister of Science and Technology, Ms NalediPandor , for not being available to attend the Committee’s deliberations on Budget Vote 34. The Committee welcomed the introductory and concluding remarks by the Deputy Minister of Science and Technology, Ms ZanelekaMagwaza-Msibi .

2. The Committee acknowledges that many of its Members are new to the portfolio of science and technology and would thus require follow-up engagements with the Department and its entities. This is necessary to further enhance their understanding of the operations of the Department and strengthen their oversight capacity to deal with matters in this regard.

3. The Committee agreed to visit entities as an important mechanism to attain the in-depth knowledge about the operations and programmes of the entities.

4. In light of the above, the Committee further undertakes to monitor regularlythe progress of the Department and its entities; especially in relation to key priorities highlighted in the National Development Plan (NDP), the New Growth Path (NGP) Framework and the Industrial Policy Action Plan (IPAP).

5. The Committee encourages the Department to continue strengthening the innovation capacity of the country and forge the necessary linkages with all the instruments of the National System of Innovation (NSI), including innovation partnerships with the private sector.

6. The Committee notes the important role that agencies such as the National Intellectual Property Management Office (NIPMO) have to play in supporting the country’s innovation system. The Committee questioned whether NIPMO’s budget was adequate to fulfil its mandate.

7. The Committee notes that intergovernmental collaborative partnerships are instrumental in ensuring the success of both the science and innovation systems.

8. The Committee notes that the gross expenditure on R&D, as a percentage of GDP had slowed, instead of increasing. They enquired about the Department’s ability to meet the percentage target for R&D expenditure of 1.5 per cent by 2019. The Committee resolves to have a briefing on this matter.

9. The Committee notes the importance that IKS has played in the well-being of society. The Committee is keen to have follow-up briefings on the Department’s IKS programme and the National Recordal System (NRS).

10. The Committee noted the vacancy rate in the Department and the money spent on consultants.

11. The Committee notes the NDP’s resolution to increase the number of PhD graduates to 100 PhDs per million by 2030 and is keen to have follow-up engagements regarding the achievement of this initiative.

12. The Committee requires a further detailed breakdown of the Department’s and its entities budgets.

13. The Committee notes the Department’s record of receiving unqualified reports by the Auditor-General, but encourages tightening of internal control systems and supply chain management systems at the Department.

6. Committee Recommendations

1. The Committee recommends that the budget for NIPMObe reviewed to ensure that they have the necessary resources to fulfil its mandate.

2. The Committee recommends the strengthening of relations between the Department and various other government departments in which science and technology is transversal (particularly, Department of Basic Education and Higher Education).

3. The Committee recommends that the Department work towards filling all vacancies and reconsider their spending on the hiring of consultants.

Portfolio Committee on Science and Technology, having considered and concluded its deliberations on Budget Vote 34 and the Annual Performance Plan of the Department of Science and Technology for the 2014/15 fiscal year, supports the Vote.

The Democratic Alliance and the Economic Freedom Fighters reserved their right to an opinion on the Budget.

Report to be considered.


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