ATC151028: Budgetary Review and Recommendation Report of the Portfolio Committee on Science and Technology on the performance of the Department of Science and Technology for the 2014/15 financial year, dated 21 October 2015

Science and Technology

The Budgetary Review and Recommendation Report of the Portfolio Committee on Science and Technology on the performance of the Department of Science and Technology for the 2014/15 financial year, dated 21 October 2015

The Portfolio Committee on Science and Technology, having considered the performance of the Department of Science and Technology for the 2014/15 financial year and its submission to National Treasury for the 2016 Medium-Term Expenditure Framework, reports as follows:


  1. Introduction


  1. Mandate of the Portfolio Committee on Science and Technology


The Portfolio Committee on Science and Technology (the Committee) is mandated by the Constitution and the Rules of Parliament to oversee the activities and performance of the Department of Science and Technology (the Department) and the entities that report to it. Hence, the Committee must consider, amend and/or initiate legislation; consider international agreements and provide a platform for the public to participate and present views on issues and/or legislation specific to the science, technology and innovation system. The entities that reported to the Department during the 2014/15 financial year are the:


  1. National Advisory Council on Innovation (NACI)
  2. National Research Foundation (NRF)
  3. Council for Scientific and Industrial Research (CSIR)
  4. Human Sciences Research Council (HSRC)
  5. Technology Innovation Agency (TIA)
  6. South African National Space Agency (SANSA)
  7. Academy of Science of South Africa (ASSAf)


To enhance Parliament’s oversight role, the Money Bills Amendment Procedure and Related Matters Act (Act 9 of 2009) was promulgated to provide Parliament with a procedure to make recommendations to the Minister of Finance to amend the budget of a national department. A key provision of this Act is that Portfolio Committees must annually compile Budgetary Review and Recommendation (BRR) Reports. These BRR Reports provide an assessment of service delivery performance given available resources; evaluates the effective and efficient use and forward allocation of resources; and may make recommendations on the forward use of resources. The BRR Reports are also source documents for the Committees on Appropriations when they make recommendations to the Houses of Parliament on the Medium-Term Budget Policy Statement (MTBPS).


  1. Method to develop the 2015 Budget Review and Recommendation Report of the Portfolio Committee on Science and Technology


In preparation for the BRR Report, the Committee assessed the performance of the Department and the entities by:


  • Deliberating and considering the prevailing Strategic Plans and the 2014/15 and 2015/16 budget allocations and Annual Performance Plans;
  • Evaluating the 2014/15 quarterly performance and expenditure trends, as well as the first quarter performance and expenditure for the 2015/16 financial year;
  • Conducting oversight by having briefings on specific initiatives and programmes, which included site visits;
  • Inviting the Auditor-General (AG) to explain the 2014/5 audit outcomes for the Department and the entities; and
  • Deliberating and considering the 2014/15 Annual Reports of the Department and the entities.


  1. Mandate of the Department of Science and Technology


The Department is responsible for developing, co-ordinating and managing the National System of Innovation (NSI) to transform the economy and provide a better life for all South Africans. In fulfilment of this responsibility, the Department, with its entities, seeks to create an environment that promotes innovation; enhance South Africa’s knowledge-generation capacity; develop appropriate human capital in science, technology and innovation (STI); build and maintain excellent STI infrastructure; and position South Africa as a favourable location to conduct scientific research and development (R&D).




Science, technology and innovation are considered crucial for the creation of wealth and improving the quality of life in modern society. Hence, governments, as they strive for equitable and sustainable development, have a duty to create an enabling policy environment to support these goals. In South Africa, the 1996 White Paper on Science and Technology introduced the concept of a NSI as an enabling framework for the development and application of science and technology 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 National Research and Development Strategy (NRDS) and the Ten-Year Innovation Plan (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 comprise the biotechnology and pharmaceutical industry (now referred to as the Bio-economy), space science, energy security and global change. The idea is to have multidisciplinary thinking amongst South African researchers to deal with these challenges in an innovative way that would bring socio-economic changes in this country as it is envisaged in both the National Development Plan (NDP) and the New Growth Path (NGP).


The NDP identifies the need to increase the size, coherence and effectiveness of the NSI to enhance South Africa’s ability to compete globally. Hence, the country must enhance its investment in infrastructure, improve the skills base and ensure that it better exploits the knowledge generated from its investments in R&D.


2.1     2014-2019 Medium-Term Strategic Framework


The 2014-2019 Medium-Term Strategic Framework (MTSF), approved during the 2014/15 financial year, represents the first phase of implementation of the NDP and commits Government to 14 key outcomes. The Department contributes directly to Outcomes 3, 4, 5 and 10. Table 1 shows the specific actions and commitments led by the Department in the 2014-2019 MTSF and reflects progress with these as at March 2015.


Table 1:       Contribution of the Department of Science and Technology to the 2014-2019 Medium-Term Strategic Framework






Progress as at March 2015

Outcome 3:

All South Africans are safe and feel safe

Sub-outcome 4:

Secure cyberspace

Develop R&D capacity

R&D Centre of Competence

National R&D Programme approved in 2014/15

Convened stakeholder engagement forum workshop. Convened Task Team workshop to finalize the agenda. R&D agenda, implementation plan and costing model approved internally. Remedial action: Secured meeting with Minister

Outcome 4:

Decent employment through inclusive economic growth

Sub-outcome 10:

Research, development and innovation (RDI) investment supports inclusive growth

1. Strengthen RDI partnerships between government and the private sector


2. Align strategies for emerging/new industries with the Industrial Policy Action Plan (IPAP) and monitor regularly for long-term growth and competitiveness, job creation and export potential


3. Review existing market-based and state incentives for effectiveness in increasing investment in innovation

1. Percentage increase in the rand value of investment by Government and the private sector in R&D partnerships


2. Emerging/new industry sector and cross-cutting interventions towards growth, employment creation and higher incomes for poor households underway


3. Institutional mechanism for the strategic management of public funding for RDI

1. 300 percent increase in the rand value of investment by 2018/19 as compared to 2013


2. Evaluation of five candidate projects for inclusion in the 2015 iteration of the Emerging Industries Action Plan (EIAP)


3. Review finalised with specific, costed and viable proposals in 2014/15

1. 9 Sector Innovation Funds (SIFs) have been launched as partnerships between the Department and industry representative bodies. Contract discussions for the Technology Stations Programme (TSP), managed by TIA, have been concluded for the next phase of the TSP. These will provide sponsored/discounted technological services and support to firms


2. Addressing EIAP development and implementation resource constraints were presented to Department DG and EXCO. Actions, deliverables and associated timelines to be revised on selected proposal approval


3. Amendments to Section 11D of Income Act, under which R&D Tax incentive is administered implemented. On-going monitoring effect of changes. Department is developing concept on how to coordinate R&D budgets and a first discussion with National Treasury has taken place

Outcome 5:

A skilled and capable workforce to support an inclusive growth path

Sub-outcome 3:

Increase access to high-level occupational directed programmes in needed areas

1. Expand access to communication technologies


2. Bursary support for postgraduate students


3. Award research infrastructure grants to higher education institutions, science councils and national facilities


4. Increase research outputs by NRF-funded researchers


5. Increase the number of research grants

1. Average amount of bandwidth per South African National Research Network (SANReN) site per annum


2. Number of post-graduates funded through Department per annum


3. Number of research infrastructure grants awarded


4. Number of Institute for Scientific Information (ISI) accredited research articles published by NRF-funded researchers as reflected in the NRF projects reports


5. Total number of researchers awarded research grants through NRF-managed programmes as reflected in the NRF project reports

1. 2 800 Mbps average bandwidth capacity available per SANReN site by 31 March 2015


2. 4 671 Masters, 2 665 Doctoral and 690 Post-doctoral by 2015


3. 60 research infrastructure grants awarded to higher education institutions, science councils, national facilities of the NRF, museums by March 2015


4. 5 700 ISI- accredited research articles published by NRF-funded researchers by 31 March 2015


5. 3 876 researchers awarded research grants through NRF-managed programmes as reflected by the NRF project reports by 31 March 2015

1. The average bandwidth capacity available per SANReN site is 2 820 Mbps


2. 4 263 Masters, 2 845 Doctoral and 779 Post-doctoral


3. 69 research infrastructure grants have been awarded to higher education institutions


4. 6 470 ISI publications were produced


5. 4 064 researchers were awarded research grants through NRF managed programmes

Outcome 10:

Protect and enhance South Africa's environmental assets and natural resources

Sub-outcome 2:

An effective climate-change mitigation and adaptation response

Undertake research in climate sciences

Functional climate change research network formalised through Memoranda of Understanding


Department continued to fund a number of global change programmes and initiatives that are involved in climate change related research

Sub-outcome 3:

An environmentally sustainable, low-carbon economy resulting from a well-managed, just transition

Increase investment in RDI to support the transition to a green economy

Rand value of public and private sector investment in R&D to support a green economy

300 percent increase in the rand value of investment in R&D made in 2011

No target/milestone for 2014/15


2.2        Key measurable objectives


The Department’s 2011-2016 Strategic Plan identifies human capital development, global and Africa collaboration, knowledge generation (R&D), knowledge exploitation (innovation) and infrastructure development as priority focus areas. The Department’s objectives as outlined in its 2014/15 Annual Performance Plan flows directly from the 2011-2016 Strategic Plan. The Strategic Plan indicates that the Department is championing advanced and smaller, traditional sectors of the economy; particularly sectors with a high potential for creating and retaining jobs. As such, the 2014/15 Annual Performance Plan identifies the following as areas that require interventions:


  • Achieve critical mass in a small number of long-term, large-scale and high-impact priority areas that have been identified over the past few years;
  • Ensure that high-level human capital is developed and employed in long-term productive research in South Africa;
  • Introduce and strengthen efforts that enhance South Africa’s ability to exploit knowledge effectively for economic and social benefit;
  • Improve the ability of government investment to leverage private sector and international funding;
  • Build the knowledge-generation and knowledge-exploitation capabilities in rural and historically disadvantaged higher education institutions;
  • Provide and maintain state of the art STI infrastructure;
  • Create a coordinated and integrated NSI governance and robust monitoring and evaluation;
  • Develop and strengthen regional and provincial innovation systems and capabilities to meet community and industry demands;
  • Use the cluster system to facilitate alignment of the Department’s programmes to the NGP, the IPAP and the NDP;
  • Resource the system by achieving and going beyond the 1% Gross Expenditure on Research and Development (GERD) as a % of Gross Domestic Product (GDP); and
  • Strengthen government-industry-higher education partnerships.


  1. Summary of previous key financial and performance recommendations of THE PORTFOLIO Committee ON SCIENCE AND TECHNOLOGY


The Committee’s 2014 BRR Report contained the following recommendations:


  • That the Department and its entities make concerted efforts to correct the shortcomings as highlighted by the Auditor-General contained in its annual reports.


  • For the Department to continue playing a meaningful role in contributing to equitable economic growth and development and that the proposed budget cuts by the National Treasury should be reviewed with the possibility of it not being effected.


  • That the overall allocation for science and technology should be increased.


  • That the Minister of Science and Technology facilitates discussions to encourage government to prioritise its commitment towards allocating 1.5% of GDP to investment in R&D.


As per the provisions of the Money Bills Amendment Procedure and Related Matters Act, the Committee’s 2014 BRR Report was forwarded to the Ministers of Finance and Science and Technology.


The Minister of Finance, in his response to Parliament, stated that, “The constrained fiscal framework has narrowed the scope to provide additional funding over the 2015 MTEF period. Institutions were therefore advised to fund priorities through reprioritising funds from their existing baselines.”


  1. Overview and assessment of financial performance


  1. Overview of Vote allocation and spending (2010/11 to 2015/16)


Table 2:       Overview of the Department’s Medium Term Expenditure Framework programme allocation and 2014/15 expenditure.

Vote 34: Science and Technology


















1. Administration








2. Technology Innovation



1 160.4

1 671.0

1 049.5


1 008.8

3. International Co-operation and Resources








4. Research, Development and Support

1 754.1

1 956.3

2 057.0

2 473.2

3 492.9

3 489.8

4 247.1

5. Socio-Economic Innovation Partnerships

1 174.7

1 264.4

1 418.6

1 653.6

1 542.2

1 539.2

1 804.5


4 051.9

4 403.5

4 999.6

6 198.2

6 479.9

6 389.0 (98.6%)

7 482.2


The Department was allocated R6.48 billion for the 2014/15 financial year and focussed its spending on developing STI human capital; the generation and exploration of knowledge; investing in R&D infrastructure; strengthening regional, continental and international co-operation in STI; and encouraging South African innovation by funding marketable products emerging from research and incubation. The Department relies on its entities and research performing institutions to fulfil its mandate, hence, 93 per cent (R6 billion) of the Department’s budget was allocated to Transfers and subsidies. Other allocations according to economic classification included, R284. 9 million (4.4%) for the Compensation of employees, R174 million (2.7%) for Goods and services, and R6 million (0.1%) for the Payments for capital assets. In line with the spending focus of the Department, most of the budget was allocated to the Programmes that implement key policies and objectives, namely, Programmes 2, 4 and 5.


The Department spent R6.4 billion (98.6%) of its allocated budget by the end of the 2014/15 financial year, underspending by R90.8 million. Programme 2 accounted for R75 million of the unspent funds and this was due to savings incurred by TIA due its organisational restructuring process that saw its staff complement reduced from 223 to 162.


The Department’s spending against its budget allocation was consistently above 90 per cent from 2009/10 to 2014/15.


  1. Overview of entity allocation


The entities are funded through a Parliamentary grant (baseline allocations), specific project funds (ring-fenced) from the Department, and from income that is generated from research and commissioned projects, or royalties, publishing, membership and facility fees. In total, the six entities were allocated, as their baseline funding, approximately R3 billion of the Department’s 2014/15 budget, with the NRF and CSIR receiving the bulk of this allocation. Table 3 shows the Parliamentary grant (baseline allocation) received by the entities during 2014/15 and the percentage this accounts for in terms of the total revenue.


Table 3:            Parliamentary grant transferred to the entities during 2014/15


Parliamentary grant (R’000)

Percentage of total revenue

Council for Scientific and Industrial Research

675 340


National Research Foundation

1 568 756


Human Sciences Research Council

245 872


South African National Space Agency

180 585


Technology Innovation Agency

389 370


Academy of Science of South Africa

35 045



All six entities require funds, additional to their baseline allocations, to meet their mandate and operating costs. In addition, the challenges experienced by entities as well as the additional responsibilities being assigned to them also show that the current baseline allocations are insufficient and not increasing at the rate necessary to bring about the required rate of change within the NSI.


  1. Auditor-General’s report


The AG audited the Department, HSRC, NRF and the CSIR. Private auditors audited TIA, SANSA and ASSAf. The Department, HSRC, NRF, CSIR, TIA, and SANSA all received clean audit opinions. The clean audit opinion of the Department was attributed to the effectiveness of its management in addressing the audit findings of the 2013/14 financial year. ASSAf received an unqualified audit opinion with findings related to performance information and compliance with legislation.


The AG raised the following matters concerning the drivers of key controls. Within the Department and the NRF, the AG advised that the management’s oversight responsibility regarding supply chain management and performance information management be strengthened. Furthermore, that the Department institute more effective policies and procedures to manage its contracts. Within the HSRC, the AG advised that the information technology (IT) management system was not yet fully sorted out.


ASSAf was subjected to a new audit framework, which identified a number of findings relating to the financial statements and performance information that was submitted. Currently, ASSAf has inadequate capacity (small organisation) to address all the audit findings. Hence, it will receive administrative support from the Department.


The Department and its entities did not incur any unauthorised expenditure. The Department, CSIR, HSRC and the NRF incurred irregular expenditure amounting to R24.6 million. TIA incurred irregular expenditure of R44 million. This dates back to 2012/13 after TIA initiated its own process to clear all legacy issues dating back to the entities it inherited and former management practices. SANSA incurred irregular expenditure of R166 thousand. The reasons for some of the irregular expenditure incurred include, incorrectly calculating VAT, an emergency procurement not properly motivated for, not following the procurement process, and a shortened tender period. The AG advised that the Department and its entities institute proper oversight of supply chain management and implement consequence management processes.


The HSRC, SANSA, and NRF incurred fruitless and wasteful expenditure amounting to R94 thousand stemming from traffic fines, flights missed, failing to use booked hotel rooms, double payments to a supplier, and interest charged on Telkom invoices.


  1. 2016/17 Medium-Term Expenditure Framework financial submission


Cognisant of the current fiscal strain and the guidelines set by National Treasury, the Department submitted the following MTEF request:


  • National Intellectual Property Management Office (NIPMO): in 2016, funding to cover the general shortfall (NIPMO is an unfunded line item and has been funded by reprioritising funds within the Department) and support for the Offices of Technology Transfer (OTTs).
  • Department entities: inflation plus 2%, to be distributed at the Department’s discretion.
  • Infrastructure bids: R998 million from 2018/19.
  • Economic Competitiveness Support Package (ECSP): extend current funding for duration of the MTEF and do not terminate in 2017/18.
  • New initiatives from 2017/18: R640 million for a Mining Innovation Programme, funding for TIA to counter previous cuts, Water and Waste Innovation Programme, Medical diagnostics, and Innovative Building Technologies.


  1. Overview of service delivery performance


  1. Service delivery performance for 2014/15


Overall, the Department achieved 55 of its 65 targets (85%), which is an improvement of eight per cent from the previous financial year. Six targets (9%) were partly achieved and four targets (6%) were not achieved. The Department ascribes the continuous improvement in its performance to implementing the Performance Information Management Systems (PIMs), which was launched in the 2013/14 financial year. The PIMs resulted in the improvement of performance compliance standards regarding validity, relevance, integrity and the usefulness of performance information. Key achievements for the Department include:


  • South Africa being ranked number 36 among 54 countries in the 2014 World Review of Biotechnology;
  • The Nanotechnology Vision 2014 for South Africa, a roadmap for nanotechnology innovation, was approved during the reporting period;
  • Establishing nine sector-specific innovation funds that are running in a co-founding arrangement with a number of identified industry sector associations, namely, the Fresh Produce Exporters’ Forum, Forestry South Africa, the South African Minerals to Metals Research Institute, the Marine Industry Association South Africa, the Sugar Milling Research Institute, the Paper Manufacturers Association of South Africa, Citrus Research International, the Marine Finfish Farmers Association of South Africa, and the Wine Industry Network for Expertise and Technology;
  • Awarding 69 research infrastructure grants;
  • Supporting 11 335 postgraduate students and 4 064 researchers with grants;
  • Producing 6 470 ISI publications;
  • Hosting the inaugural Innovation Bridge;
  • Securing R634.5 million in foreign funds for investment in and co-operation with South African research and technology organisations and brokering 18 international partnerships to support STI capacity building in Africa; and
  • Launching five new centres of competence (CoCs) and increasing the number of centres of excellence to 14.


  1. Programme and entity performance


Table 4: 2014/15 Programme performance targets




Partially achieved

Not achieved

Programme 1 – Administration (of the Department)


15 (88%)

2 (12%)


Programme 2 – Technology Innovation


9 (64%)

2 (14%)

3 (22%)

Programme 3 – International Cooperation and Resources


10 (100%)



Programme 4 – Research Development and Support


11 (84%)

1 (8%)

1 (8%)

Programme 5 – Socio Economic Innovation Partnerships


10 (91%)

1 (9%)


2014/15 performance


55 (85%)

6 (9%)

4 (6%)

2013/14 performance


44 (77%)

9 (16%)

4 (7%)


Table 5 lists the 2014/15 performance targets that were not achieved. The Department explained that deficiencies with target formulation, process and administrative delays, and delays by co-implementers were the reasons for these targets not being achieved. For example, regarding target formulation, the target to achieve 285 innovation support interventions should not have been included at all and the new technology (satellite design) that was to be developed was not going to be commercialised.


Table 5:            2014/15 Performance targets that were not achieved



Actual performance

Reason for deviation

Programme 2 – Technology Innovation


  • 3 targets not achieved

285 innovation support interventions (2013/14 achievement was 50 innovation support intervention)

38 innovation support interventions

The intellectual property (IP) creator intervention was delayed due to the lack of funds to incentivise the IP creators as per the recommendation of the National Intellectual Property Management Office (NIPMO) Advisory Board. It is expected that, if funds are made available for this incentive scheme, the incentives could be paid from next year onwards in a phased manner

One trademark, design, copyright, plant breeder right

No trademark, design, copyright, plant breeder rights

Given the nature of research and development, it is difficult to accurately predict the granting of trademarks

One new technology commercialised (2013/14 achievement was 15 new technologies commercialised)

No new technology commercialised as planned

There were project delays in ensuring the finalisation of the ZA-ARMC satellite design. Remedial measures are being taken

Programme 4 – Research Development and Support


  • 1 target not achieved

A Bill for the Protection, Promotion, Development and Management of IKS (IKS Bill) tabled before Parliament by 31 March 2015

The IKS Bill was tabled with Cabinet and approved for publication in the Government Gazette. It was not tabled in Parliament

The delay in submitting the Bill arose out of delayed inputs from cognate departments and the introduction of new administrative steps in the submission of draft Bills


The 2014/15 Annual Report also states that two performance targets were adjusted as per National Treasury prescripts. These include adjusting the one trademark, design, copyright, plant breeder right down to zero, and the four new MeerKAT antennas installed down to three. Concerning the MeerKAT antennas, the four antennas represented a cumulative total for the 2013/14 and 2014/15 financial years and should not have been listed as “four new antennas”.


Programme 1: Administration


The purpose of Programme 1 is to conduct the overall management and administration of the Department, to ensure that organisations funded by the Department comply with good governance standards and to ensure that their activities are aligned with the strategic focus of the NSI. Programme 1 achieved 88% of its targets and notable achievements include:


  • The Chief Directorate: Science Communication developed and implemented communication, media and marketing strategies for the Budget Vote, Africa Engineering Week, National Science Week, the Women in Science Awards, and Public Service Week. It also hosted six public participation programmes; and
  • Concerning the science councils, the NRF, SANSA and CSIR Boards were reconstituted.
  • Maintaining the Department’s staff vacancy rate at approximately 6%.


NACI, a unique entity in that it is one of approximately six in the world, is funded and administered by Programme 1. NACI could not achieve the majority of its performance targets as articulated in its 2014/15 Annual Performance Plan since:


  • The replacement of the previous Council and the transition to the current Council was delayed. This will continue to effect the current year’s performance;
  • The appointment of the Chief Executive Officer (CEO) was delayed; and
  • Poor planning, lack of monitoring and evaluation, poor corporate governance and operational inefficiencies resulted from the delays mentioned above.


However, work towards the performance targets that were not achieved in 2014/15 continues since these comprise three key tasks assigned to NACI by the Minister of Science and Technology. These key tasks are to review the current Science and Technology White Paper, to develop the next decadal plan, and develop a STI information repository. NACI had a budget of R18 million, but only spent R10.9 million. NACI is working toward improving its planning, governance and evaluation systems. It completed the 2014 South African STI Indicators booklet, developed a draft framework for the STI information repository, and completed a foresight framework for a new STI policy. Within its new structure, NACI has included the CEO’s of the science councils so that it better exploits the expertise currently in the STI system.


Programme 2: Technology Innovation


The purpose of Programme 2 is to facilitate knowledge generation and exploitation through R&D in key priority areas, namely space science, biotechnology, health and energy. The Programme also facilitates the development of innovative products and services, and their commercialisation where appropriate. Programme 2 achieved 64% of its targets and notable achievements include:


  • Regarding the Bio-economy Strategy, three co-ordinating committees were set up for the three key themes of the Strategy, namely, agriculture, health, and industry and environment. These committees have overseen the finalisation of their respective implementation plans. These plans must still be approved by the Executive management (EXCO) of the Department;
  • Four publications, one copyright and 154 postgraduate student supported through bio-economy RDI initiatives;
  • Launch of an innovative 2.5 kW hydrogen fuel cell power generator prototype unit at the University of the Western Cape’s (UWC) Nature Reserve, which was expected to lower its energy bills and carbon footprint. The Hydrogen South Africa (HySA) CoCs have also resulted in the generation of 32 publications in peer reviewed journals and two patent applications being filed (one on a hydrogen storage and supply system integrated with a fuel cell power pack that comprises liquid gas, and one on a metal hydride storage container);
  • One hundred and forty-two (142) postgraduate students were supported in the energy-related RDI initiatives;
  • The approval of the Department’s Commercialisation Framework. Advanced plans are under way to implement the Framework in terms of proposals received from the CSIR. Part of this work will include plans on implementing the EIAP concept note as developed by the Department; and
  • Completion of the first NIPMO Incentive Scheme Guideline for Intellectual Property Creators, which saw more than 360 IP creators awarded a certificate of recognition for their role in the creation of an invention for which a South African patent was granted.


The TIA, funded by Programme 2, is mandated to stimulate and intensify technological innovation and achieved 73% of its targets, and exceeded 63% of these. The TIA also achieved all its strategic outcome targets. During 2014/15, the TIA was under the leadership of an interim CEO, who implemented the TIA Organisational Re-design process. This process required that TIA improve the efficiency and effectiveness of its core and support business areas, and reduce its costs. This was achieved by reducing its staff complement from 222 to 156, and appointing leadership capable of implementing TIA’s new strategic direction. The new CEO assumed office on 1 April 2015. The re-design and change management process was completed successfully. The investments made and funds disbursed by TIA grew. However, due to the current fiscal strain, its Parliamentary grant was decreased, so it is exploring alternative business development efforts to diversify its funding streams.


During 2014/15, the TIA supported 38 knowledge innovation products and 2 188 small and medium enterprises via the Technology Stations, took six technologies to market and helped eight technologies reach the demonstration phase.


The SANSA, funded by Programme 2, is mandated to promote and foster research in space science and engineering and achieved 22 of its 34 (65%, 85% in 2013/14) targets. The Space Programme division experienced funding challenges across all its key performance areas, specifically in the satellite development programme (EO-Sat1), which is being project-managed internally. The Earth Observation Programme achieved nine of the 11 targets (82%). The Space Operations Programme achieved seven of the eight targets (88%). The Space Science Programme achieved 75% of its targets, missing only two targets. The following performance against its strategic goals was recorded:


  • Goal 1 – World-class and efficient services and  societal benefits (Societal Capital): 67% success rate, due to backlogs in the global space industry and delays in processing the EO-Sat1 project contracts;
  • Goal 2 – Cutting-edge research, development, innovation, technology and applications (Intellectual Capital): performance at 50%, due mainly to cash flow challenges and delayed funding for the EO-Sat1 project;
  • Goal 3 – Effective development of human capital, transformation and engagement of citizenry (Human Capital development - HCD): achievement of 67%, due to budgetary constraints and challenges in securing student funding. Since HCD budgets across the organisation were under pressure, SANSA could only support students who already held multi-year SANSA bursaries;
  • Goal 4 – Globally competitive national space industry (Economic Capital): performance at 75%. Budgetary constraints and no expenditure on space industry development prevented the full achievement of this goal; and
  • Goal 5 – Make South Africa a recognised global space citizen (Global Capital): achievement at 75%. Limited success in securing a planned, multi-national project to complement the agreement with the Algeria Space Agency prevented the full achievement of this goal.


Currently, the satellite development programme is back on track but behind schedule. The staff demographics of SANSA are not ideal, which reflects a systemic problem, but the Minister of Science and Technology has instructed that every effort be made to change this. SANSA has also been instructed to improve its communication strategy to convey the importance of space and its use to the public. These efforts will require a significant increase in SANSA’s funding allocation.


Programme 3: International Co-operation and Resources


Programme 3 is responsible for developing, promoting and managing international relationships, opportunities and S&T agreements that strengthen the NSI and enable an exchange of knowledge, capacity and resources between South Africa and its regional and international partners. This Programme achieved all its targets and notable achievements include:


  • The Minister of Science and Technology attending the S&T Ministerial meeting of BRICS (Brazil, Russia, India, China and South Africa), which resulted in the signing of the first BRICS Memoranda of Understanding on co-operation in STI initiatives;
  • Launching new initiatives in the marine sciences with Argentina and on biotechnology co-operation with Jamaica;
  • Adoption of the 2014 Strategy for Science, Technology and Innovation in Africa (STISA) by the Heads of States of the African Union; and
  • Leveraging R634 million in foreign STI funds.


A strategic framework is being developed to guide the Department’s efforts to attract STI-orientated foreign investment in South Africa, such as promoting South Africa as an attractive destination for multinational companies to locate their corporate R&D facilities.


Programme 4: Human Capital and Knowledge Systems


Programme 4 must provide an enabling environment for research and knowledge production that promotes strategic development of basic sciences and priority science areas through science promotion, HCD, the provision of research infrastructure and relevant research support, in pursuit of South Africa’s transition to a knowledge economy. Programme 4 achieved 84% of its targets with notable achievements including:


  • A review by an international panel of the Applied Centre for Climate and Earth Systems Science (ACCESS) recommended that it be repositioned as a CoE;
  • An evaluation of the 2004 IKS Policy will be included in the National Evaluation Plan;
  • Funding 11 335 students;
  • The approval of the National Multi-Wavelength Astronomy Strategy by the Minister; and
  • EXCO approving the Marine and Antarctic Research Strategy and the implementation plan of the Science Engagement Strategy.


The NRF, funded by Programme 4, is mandated to support and promote research through funding, human capital development and the provision of research facilities. Performance against the goals set by its Vision 2015 plan show that the NRF achieved five of the nine key outcomes, which led to a:


  • 47% Increase in the number of doctoral students supported;
  • 33% Increase in the number of ISI research outputs;
  • 39% Increase in PhD graduates per annum;
  • 29% Increase in the proportion of global ISI outputs;
  • 52% Increase in the number of women rated researchers;
  • 77% Increase in the number of black rated researchers;
  • 41% Increase in global research impact; and a
  • 15% Average annual increase in bursary values.


The above-mentioned increases are all from a relatively low base and the NRF, with its current budget, can only support 5% of the total honours registrations, 7% of the total Masters registrations and 14% of the PhD registrations.


The NRF Strategy 2020 will focus on:


  • Building a closer working relationship with universities and research communities, to address the transformation imperative;
  • Development of a resourcing plan for the South African Agency for Science and Technology Advancement (SAASTA) as the national co-ordinating body for the Science Engagement Framework;
  • Continue with the restructuring and renewal of Research and Innovation Support and Advancement (RISA) as a client-centric division that is widely known for its excellent customer service;
  • Strengthening the science plans of the National Research Facilities (NFs) to increasingly deliver globally competitive science; and
  • Rolling out Astronomy as an effective sub-agency of the NRF with appropriate international engagements and participation to support the multi-wavelength strategy.


The ASSAf, funded by Programme 4, has a dual mandate in that it is a honourific entity and through the expertise of its members, provides evidence-based science advice in support of policy development and decision-making on issues of national significance. Examples of advice generated include:


  • Diversity in Human Sexuality: Implications for Policy in Africa;
  • State of Biosafety and Biosecurity in South Africa; and
  • The State of Energy Research in South Africa.


The ASSAf selected 23 new members in the year under review and now have 441 members (of these, 25% are women and 28% are black). ASSAF hosted various workshops and activities to promote women in science, science in South Africa and Africa, and to enhance the capacity of science academies on the continent. Within each of its programmes, ASSAf reported on a range of activities that its five programmes successfully undertook to further its mandate.


Programme 5: Socio-Economic Partnerships


Programme 5 enhances the growth and development priorities of government through targeted science and technology interventions and the development of strategic partnerships with other government departments, industry, research institutions and communities. Programme 5 achieved 91% of its targets. Notable achievements include:


  • EXCO approving the National Water RDI Roadmap;
  • Registering the Nkowankowa Demonstration Centre project under the name Wolkberg Fruit Processors (Pty) Ltd. This project has advanced towards becoming a financially sustainable entity. It has increased production by 300%, tripling the economic benefit accruing to farmers, households and employees in the Greater Tzaneen Municipality local economy;
  • Transferring the Rose Geranium Essential Oil portfolio to the South African Essential Oil Business Incubator for management; and
  • Publishing a policy brief on accelerating sustainable water service delivery.


The HSRC, funded by Programme 5, conducts research that serves the public, contributes towards good governance and public service delivery and helps address challenges of poverty and inequality. It achieved 71% (29 of 41) of its targets. Due to systemic issues, it was unable to achieve the planned targets regarding recruiting PhD and Postdoctoral interns, recruiting female African researchers, and reaching the external funding target. Concerning the provision of evidence-based policy advice, the HSRC produced 52 client reports for government departments. It is also concluding the appointment of an Executive Director for the Africa Institute of South Africa (AISA), now a research unit within the HSRC. The HSRC continues to be hampered by the poor state of its building in Pretoria; inconsistent and inadequate funding for the survey equipment needed to conduct longitudinal studies that are of national importance; and the difficulties regarding raising 40% of its budget from external funding sources and the pressure this places on its senior researchers.


The CSIR, funded by Programme 5, contributes to the improvement of the quality of life of all South Africans by engaging in multi-disciplinary research and technological innovation. Annually, the CSIR enters into a Shareholder’s Compact with the Department, which lists the specific Key Performance Indicators (KPIs) against its performance will be measured. The CSIR’s KPIs comprise three categories, namely, Scientific and technical, Learning and growth, and Financial and governance. During 2014/15, the CSIR met or exceeded all six performance indicators in the Scientific and technical category; it met or exceeded the annual targets for all seven indicators in the Learning and growth category; and met or exceeded the five indicators in the Financial and governance category. Here, R&D contract income amounting to R1.68 billion, exceeded the budget by R49 million, while income from royalties and licensing amounted to R8.7 million, exceeding the target figure by R2.9 million. The CSIR made its largest ever investment in RDI equipment (approximately R209.7 million) so that it can attract the best scientific minds.


  1. Finance and Service delivery performance assessment


The Department is not a service delivery department, per se, and setting targets that appropriately reflect the nature of scientific endeavour is not always easy. The Department has endeavoured, however, to ensure that it improves its capacity to translate adequately its work into performance indicators and targets that are measurable and meaningful. Year-on-year, the Department has consistently demonstrated that it can spend, to a great degree, its budget allocation according to spending targets, and that it has taken the necessary steps to ensure that the same progress is made with achieving its performance targets. For the 2014/15 financial year, the Department spent 98.6% of its budget and achieved 85% of its performance targets. In 2013/14, the Department spent 99.5% of its budget and achieved 77% of its performance targets. The Department has also shown that it attaches great importance to the public funds it is allocated and strictly manages these funds according to the relevant legislative prescripts. The Department, NRF, HSRC, CSIR, TIA and SANSA were all awarded clean audit opinions. The Department will provide ASSAf with the assistance it needs to meet the requirements of the new audit framework with which it has to comply.


The three priority domains of the Department remain R&D, human capital development, and the provision of STI infrastructure. However, given its resources, the rate of progress within these priority domains is not at the desired level. Furthermore, the biggest threats to the objectives of the Department is the poor mathematics and science performance by South African scholars, the low throughput rate to postgraduate study, and the inadequate level of investment in R&D by both the private and public sectors. Concerning the allocation of public resources within the context of fiscal strain, Programmes 2, 3 and 5 all had to contend with funding decreases, which negatively affected the work of these Programmes and the entities that are funded by them. In addition, the practice requiring the Department to identify savings in its budget by reprioritising funds means, in essence, that one project is being advantaged at the expense of another. Examples of issues brought to the Committee’s attention during its deliberations with stakeholders and oversight visits include:


  • Due to there being no real economic growth in the core grant allocated by the NRF, the South African Astronomical Observatory (SAAO) had to downsize its staff complement, cannot offer security of tenure to skilled persons that are employed on contract, and cannot offer new positions. Due to the reduced complement of skilled staff, the SAAO has had to cancel one of its student development programmes, and withdraw implementing a second shift in its state-of-the-art mechanical workshop. This negatively influences the optimal usage of scarce facilities, bought with public resources, both for student training and engineering development;
  • NIPMO remains an unfunded line item, and could only transfer the necessary funds to qualifying institutions after the 2014 adjustment budget process and funds were reprioritised;
  • The HSRC continues to struggle to get public funding for the longitudinal studies it conducts. The results of which are used by government departments for planning and policy development; and
  • SANSA did not have adequate funding to award new bursaries or continue with its space industry development goals. Hence, it will struggle to transform the demographics of its workforce; increase its public awareness programmes to generate interest in space science as a viable career choice; and drive R&D-led industry development in the space sector at a rate where South Africa can compete globally.


South Africa’s investment in R&D as a percentage of GDP has remained at 0.76% for the last three years. By comparison, China invests approximately 2.08%, the Russian Federation 1.12%, the European Union 1.91%, and Korea 4.15%. Although, South Africa’s science system is small and hampered by the shortage of technical and scientific skills, it nonetheless, has to compete for resources and expertise with countries that are far more resourced to enhance the competitiveness of our economy, and create an environment conducive to STI and STI investment.


It has been conclusively shown that during fiscal strain, economies that significantly increase their investment in STI are able to respond faster and more comprehensively to fiscal improvement than economies that decrease their spending, or allow it only to increase at the existing rate of growth. In terms of the economy, the Department is specifically focusing on those sectors that are the largest contributors to South Africa’s trade deficit. Using its resources and leveraging additional resources from its STI partners, it seeks to identify and address technological issues that could lead to a reduction in the payments for imported technology and expertise. With additional resources and partnerships, this objective may be achieved faster.


The Committee is immensely pleased with the performance of the Department and its entities and is of the view that greater impact and an acceleration of the change needed by the economy can only be achieved with the allocation of additional resources. Particularly for human capital development, research and development to increase the knowledge generation capacity of the system, the development of new industries and for the provision and maintenance of research infrastructure.




  • The Committee acknowledges that science, technology and innovation is an integral part of the transformation agenda of South Africa.


  • Prior to our democracy, investment in science, technology and innovation was skewed towards the objectives of the previous economic regime and was not geared towards inclusive social transformation and upliftment.


  • The Committee recognizes that South Africa will likely remain mired in poverty unless we drastically change the reach of science, technology and innovation and do what other developing and developed countries have done to achieve sustainable growth: that is, to incorporate science, technology and innovation into their economic strategies. This sentiment is also highlighted in the NDP.


  • After reviewing the performance of the Department and its entities, the Committee expressed their satisfaction with the Department and entities’ achievements and commended them for attaining clean audits. However, the audit process did highlight that were areas that needed scrutiny to ensure full compliance with legislative prescripts.


  • They acknowledged that the Department and its entities have an important role to play in facilitating the development of cutting-edge science and technology capabilities in the country.


  • The annual report briefings by the Department and its entities indicated that there was concerted effort and progress towards delivering in key priority areas for social and economic development.


  • Initiatives and agencies, such as NIPMO and SANSA, are grossly underfunded, resulting in inadequate rates of development, decreased competitiveness, poor return on investment, and slow transformation and growth.


  • The Committee commends TIA on successfully implementing its organisational re-design programme. To increase the value of research and development investment, TIA invests in high-risk ventures to bring more products, processes and technologies to market. In five years’ time, to achieve its strategic objectives, TIA will need R800 million, which is almost double its current budget.


  • The Committee acknowledged the existing systemic and institutional issues, but expressed concern at the slow rate of demographic transformation of the science, technology and innovation system. Positive changes have been made, albeit from a relatively low base. The NRF, with its current budget, can only support 5% of the total honours registrations, 7% of the total Masters registrations and 14% of the PhD registrations. Hence, the NDP goal of producing 100 000 PhD’s per annum would be difficult to attain.


  • The Committee found that the baseline funding allocations to the Department and its entities marginally increased, which makes entities reliant on contract funding. The Committee cautioned that such a dependency might compromise government’s agenda for science and technology and its contribution to deliver on national priorities. This below inflation funding increases hampers entities from fulfilling their mandates.


  • The Committee noted that the lack of integration across government institutions is hampering the implementation of the technology solutions developed by the Department to address service delivery, planning and growth issues. Enhanced co-ordination is necessary at Executive as well as Parliamentary level to ensure that STI becomes the cornerstone to addressing the triple challenge of unemployment, poverty and inequality.


  • The Committee noted that currently there is less than one percent of GDP spent on R&D. For the country to reach its economic goals, reaching the target of 1.5 percent of GDP spent on R&D will have to be accelerated.


  • The Committee noted the finding from the Ministerial Review Report (2012) on how different government departments fund their research institutions. Hence, it is the Committee’s opinion that funds allocated for research and development may not be optimally used for the intended purpose.


  1. Conclusions


After its deliberations, the Committee concluded the following:


  • To improve South Africa’s ability to innovate and contribute in a meaningful way to global scientific and technological advancement, greater investment in research and development cannot be over-emphasized.


  • Co-operation with the private sector is important; and government will have to find better ways of co-operation among government departments with similar cross-cutting or overlapping mandates to ensure effective implementation of intergovernmental programmes and policies. These relationships are crucial to the success of the NSI.


  • Efforts should significantly increase to promote the science sector, the Department and its entities as well as improving the communication around its contribution to societal transformation. We have to explore better ways of improving science and technology education and communication to share and promote our science with all citizens of our country.


  • It has become increasingly important as a country with limited resources and simultaneously operating in a globally competitive environment, to find ways and means of working together when innovating new products and services.


  • Should the current funding regime remain unchanged, the NSI will not expand at the required rate and, hence, limit South Africa’s ability to assist and co-operate with regional and international partners.


  • The Committee has and will continue, through the processes available to it, ensure that the Department remains accountable and fully implements its mandate as informed by broader government policy.




The Portfolio Committee on Science and Technology recommends the following:


  • The Committee restates its 2014 BRR Report recommendation that the Minister of Science and Technology facilitates discussions to encourage government to prioritise its commitment towards allocating 1.5% of GDP to investment in R&D.


  • That the Minister of Science and Technology investigates the development of a policy to establish a centralised research and development budget allocation. This would ensure efficient allocation and spending on science, technology and innovation across all government departments.


  • That the 2016 MTEF request of the Department be allocated as submitted, especially the request for inflation plus 2% for the science councils.


  • That National Treasury not effect the re-prioritisation of funds, although the Department has identified this.


  • That the Department and entities ensure full compliance with legislative prescripts to avoid future findings from the Auditor-General.


  • Agencies, such as NIPMO and SANSA, should be adequately funded to ensure improved rates of development, competitiveness, better return on investment, and faster transformation and growth.


  • The TIA’s funding should be increased to ensure increased value of research and development investment.


  • The NRF’s budget should be increased so that greater numbers of science, technology and innovation graduates can be supported to meet the goals of the NDP.


  • That the Department strengthens its efforts to collaborate with other government departments to implement the technology solutions developed by the Department that address service delivery, planning and growth issues.


  • That the Department reviews the New Strategic Management Model for Science and Technology to ensure a well-co-ordinated and improved allocation process for science councils.


  • That the Minister of Science and Technology, through her Department and within six months of this report being adopted by the National Assembly, provide the Committee with a detailed report on the effects of inadequate resourcing on the Department’s programmes and entities.


The Committee thanks the Department and the entities for their co-operation and commitment.



Report to be considered.



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