ATC171115: Report of the Portfolio Committee on Tourism on 4th Quarter Performance of the National Department of Tourism for the 2016/17 Financial Year, dated 15 November 2017
The Portfolio Committee on Tourism, having considered the 4th Quarter Performance of the National Department of Tourism and the South African Tourism, reports as follows:
The performance of the National Department of Tourism improved in the fourth quarter of the 2016/17 financial year. The Department had struggled with delays in implementing a number of projects in the previous quarters. Some of the targets had been deferred to the second and third quarter. The improved performance in the fourth quarter will contribute positively to the attainment of the annual targets as set in the Annual Performance Plan. However, challenges continued to be experienced in certain areas that need attention. The concern was that challenges were experienced in areas that had been flagged by the Committee in the previous quarters, especially delays in the implementation of programmes and projects.
- Achievement of predetermined objectives
In the quarter under review the Department set a total of 69 targets. A total of 59 targets were achieved and 10 were not achieved. The achieved targets accounted for 85.51 percent and non-achievement for 14.49 percent. This was a welcome improvement from quarter 3 wherein the Department achieved 61.91 percent and failed to attain 38.0 percent of their targets.
- Programme performance
The assessment of performance against the four Programmes is as follows:
3.1 Programme 1: Administration
The Department had 17 targets for the fourth quarter in Programme 1. Of these, 15 were achieved accounting for 88.2 percent achievement, and 2 were not achieved accounting for 11.8 percent under-performance. Programme performance was as follows:
- The Strategic Plan and Annual Performance Plan for 2017/18 were submitted for approval and the Committee scrutinised them as part of its oversight work.
- The third-quarter performance reports for 2016/17 were submitted to the Department of Performance Monitoring and Evaluation (DPME).
- Third-quarter risk mitigation report for 2016/17 was submitted to RMC for adoption.
- South African Tourism quarterly oversight report was prepared. The report covers non-financial performance, financial performance and compliance with the PFMA. It also focuses on the numbers of international tourist arrivals achieved, domestic holiday trips achieved, business events hosted in South Africa, grading of establishments, etc. The Committee has however raised concerns about the level of personnel responsible for oversight over South African Tourism.
- The vacancy rate was maintained at 6.6 percent against the 8 percent target.
- The women representation in SMS was maintained at 50.7 percent against the target of 50 Percent;
- People with disabilities representation were maintained at 4.6 percent against the 3 percent target;
- Black representation was maintained at 95.2 against the 91.5 target.
- A 20 percent implementation of Workplace Skills Plan was set as a target. This was achieved through implementing three (3) Skills Programmes. These included bursaries which were awarded to 43 departmental employees for part-time courses. Destination Development Training which was one day in-house programme was offered by Open Africa that exposed at least 20 officials to many aspects such as understanding the importance of enterprise development for suitable destination; and Responsible Tourism Workshop which exposed 20 officials to understanding the concept of visiting a place as a tourist, and making positive impact on the environment, society and economy, amongst others. The Committee was concerned about the actual number of employees in the staff establishment that have been exposed to skills programmes.
- A 100 percent compliance in the management and handling of grievances, misconduct, disputes and collective bargaining was achieved through processing 4 grievances; 2 cases of misconduct; 2 cases at an arbitration level; 1 matter that was in court; and 4 Departmental Bargaining Chamber cases (DBC). No cases were handled on conciliation and there were no appeals. The Committee had previously requested the Department to specify the nature of cases to provide a perspective on labour related issue within the Department.
- Phase 2 of the Information Communication Technology Strategic Plan (ICTSP);
- Second-quarter interim financial statements were submitted to National Treasury;
- 15 percent of the annual internal audit plan was implemented.
- The Cabinet and cluster coordination protocol was implemented.
- 100 percent implementation of Q4 requirements of the annual implementation plan of Department’s Communication Strategy;
- 100 percent of tourist complaints were referred to appropriate authorities for resolution within the agreed timeframes.
- A total of 19 complaints were lodged. Of these, 4 were resolved, 5 were referred, 9 are in progress and 1 has been closed due to no response from complainant.
- The two targets that were not achieved are the submission to Cabinet for approval of public consultation (for Draft Tourism Amendment Bill), and Publication for public comment (of Draft Tourism Amendment Bill) that were halted. The Department took a decision that the processing of the Bill to Cabinet be halted until a comprehensive review of the legislative framework was done. The Department also took a decision that the processing of the Bill to Cabinet be halted until a comprehensive review of the legislative framework was done. The Committee was concerned about the decision taken by the Department to delay the process of developing the Tourism Bill as this delays addressing pertinent issues in the current legislation.
- The Regulations on the procedure for lodging of tourist complaints developed and published in the Gazette;
- 100 percent procurement from B-BBEE compliant businesses was achieved.
3.2 Programme 2: Policy and Knowledge Services
A total of 18 targets were set for Programme 3 in the fourth quarter. A total of 16 targets were achieved accounting for 83.3 percent and only two were not achieved accounting for 16.7 percent under-performance. Programme performance was as follows:
- The first target that was not achieved is the baseline study conducted on the amended tourism B-BBEE sector code. Only a preliminary study was developed and the finalisation of the final baseline study was delayed to accommodate the Tourism B-BBEE Charter Council members in the Project Steering Committee. The delay in the implementation of this study means the continued lack of knowledge about the state of transformation in the sector. The Department did not provide progress on this baseline study.
- The two targets that were not achieved are the report on progress of construction at Shangoni Gate and a report on progress of construction at Phalaborwa wild activity hub. Both projects were delayed due to Environmental Impact Assessment (EIA) related issues. It should be noted that the EIA process had affected achievement of targets in the preceding quarterly performances. The Committee emphasised the importance of factoring in EIA timelines when projects are included in the Annual Performance Plan to avoid unnecessary non-compliance.
3.3 Programme 3: International Tourism Management
A total of 10 targets were pursued under Programme 3 in the fourth quarter. All the targets set for Programme 3 were achieved given changes made in the Accredited Tour Companies Company (ATC) program.
- With regard cross-border guiding module the logistical arrangements for training were finalised. These include approval of the submission for the appointment of the University of Pretoria as the service provider and the list of selected candidates to be trained which has been submitted to the University of Pretoria for a six months NQF 5 training through CATHSSETA. A total of 20 will be trained comprising 10 South African and 10 Namibian national tourist guides.
- Phase 2 of language training in Russian for tourist guides was implemented. Phase 2 of the training for the best performing candidates was implemented. There were 20 practitioners trained. The participants were recruited and selected from the accommodation establishments and tourist attractions that are mostly visited by the Chinese tourists in 6 of the 9 provinces.
- Placement of 20 learner chefs was done. This was an overachievement as eight (8) more learner chefs were placed. The initial proposal was that 12 (twelve) chefs were to be placed in Seychelles. However, after engagements with Seychelles Tourism Academy Seychelles indicated that they had the capacity for placement of 20 leaner chefs. The submission and the MoU for placement have been approved and signed respectively.
- Benchmarking report on tourism capacity-building programme for provinces and municipalities was completed. It presents the findings and the recommendations from the international benchmarking study undertaken to ascertain practices in respect of capacity-building interventions for tourism planning and development at provincial (regional) and local tiers of government, with a view to improving current capacity building initiatives. The Committee has witnessed endemic tourism planning challenges in municipalities during oversight visits. The Committee wanted the Department to use this study to provide more capacity building initiatives to municipalities. This must be done to complement The South African Tourism Planning Toolkit for Local Government developed in 2009.
- Pilot of capacity-building interventions for effective participation in market access programme was done. Capacity-building interventions for effective participation in market access programme was also finalised.
- The Draft Tourism Investment Master Plan was developed. The Master Plan aims to assist the Department and other institutions to target national and foreign investors for the development of the tourism sector in support of the national development objectives as set out in the NTSS. The Committee wanted the Department to facilitate the development investment portfolios based on the projects identified in the Tourism Investment Master Plan. These will be used to attract investments into the sector.
- The Accredited Tour Companies Company (ATC) program was successfully rolled out in China. This was a recommendation of the Inter-Ministerial Committee for mitigating negative effects of immigration regulations. However, the visa waiver for Russia removed the need for the ATC Programme in Russia. The Department reported that close examination of the situation in India and countries in Africa indicated that the introduction of a ATC program will not improve the visa processes in these countries.
- Final Concept Document for 2017 Indaba was also developed and approved. The theme agreed to was “The Role of Technology in the Changing Face of Travel in Africa”.
3.4 Programme 4: Domestic Tourism Management
The Department pursued 20 target under Programme 4 in the quarter under review. A total of 16 targets were achieved constituting 80 percent, and 4 were not achieved constituting 20 percent under-achievement.
- The review of the Domestic Tourism Growth Strategy was finalised.
- The social tourism activity was facilitated targeting stokvel groups. Social tourism activity was facilitated targeting 2 stokvel groups. Activations were done at Kagiso, West Rand and Nellmaphius, Pretoria. The Department partnered with the National Stokvel Association to roll out deal-driven stokvel activations promoting affordable value for money, special deals and fun bus group travel options. These activations were aligned to the domestic consumer research insights to ensure success and uptake. All 9 provinces also participated in Quarter 4 in Social Tourism for the Elderly.
- Stakeholder engagement and awareness drive on the social tourism directory was done with the city of EThekwini and the North West provincial tourism office in Rustenburg.
- Needs analysis was reviewed and 100 SMME’s supported at the end of March 2017. Reports on the use of the portal and services rendered at the incubator were done. The incubator will have 50 enrolled SMMEs based in Pilanesberg, North West province and 50 SMMEs in Manyeleti, Mpumalanga province for a period of 3 years. The second incubator was launched on 30 March 2017.
- The report on the implementation of the chefs training programme for 567 trainees was developed but this was an under-performance. The reason for variance was due to 4 learners who did not submit log sheets and six dropped-out of the project.
- 300 learners were recruited. Induction and placement was only conducted in May 2017 after the quarter had ended. The reason for variance was due to the difficulty to get host employers for 20 learners in Northern Cape Province. However the target of 300 has since been met.
- The report on the outcomes of the training for the 2003 against 2000 targeted learners that were to be recruited and placed in the hospitality service training programme is in place. Limpopo and North West learners were not trained due to the Service Provider withdrawing from the contract and the remaining numbers were topped up in other provinces to meet the target.
- With regard to the report on the outcomes of 500 learners recruited and placed for food safety assurers programme, 450 learners were recruited. Induction and placement started in April 2017. The reason for variance was the difficulty in getting host employers for 50 learners in Northern Cape Province due to the vastness of the provinces and a few establishments.
- The needs analysis was also done in the 4th quarter (Chris Hani and Dr Mompati District).
- Workshops were conducted in/with six district municipalities. ZF Mgcawu, OR Tambo, Amathole, Vhembe, Chris Hani & Dr R Mompati. The reason for variance was that one additional district municipality was done to replace the Nkomazi Local Municipality as the target in the Annual Performance Plan was District and not Local Municipality. One workshop was held for the Amathole and Chris Hani/OR Tambo District municipalities.
- The local government tourism induction programme annual implementation report was compiled. The main purpose of the capacity-building programme was to provide an integrated approach for the public sector and community members within selected municipalities, and to create a platform for stakeholder engagement and information sharing.
- The draft implementation plan for phase 1 was developed. National Tourism Careers Expo (NTCE) 2016 close out report was developed. Draft NTCE 2017 plan was developed. Annual report on the implementation of the women executive development programme developed.
- The consolidated report was developed on the implementation of service excellence integrated support programme (including the three sites) was developed. The report covers the summarised service excellence product support implementation progress; brief implementation progress at Robben Island, Manyane and Skukuza Rest camp. The Golden Gate Highlands National Park was replaced by Skukuza Rest Camp at the request of SANparks.
- The final report on the development of tourism interpretation signage at the four iconic national heritage sites was completed.
- The Department monitored progress and reported on implementation at the 50 selected beaches.
- First draft on tourism Infrastructure Master Plan developed.
- 722 FTE jobs were created through the SRI Programme instead of 1 221 target for the quarter. The reason for variance was that the labour intensive projects only commenced in the third quarter due to the Government Technical Advisory Centre (GTAC) processes.
- Budget and expenditure analysis
The fourth quarter budget expenditure report as provided by the National Treasury indicates that at the end of quarter 4 the Department had spent a total of 95.6 percent of its 2016/17 allocation, realising a total underspending of R88.4 million or 4.4 percent of the available budget.
- In Programme 1 the Department spent 95.6 percent with an underspending of R10.4 million. Under-spending was mainly due to cost containment measures implemented by the department in compliance with instructions received from the National Treasury. These measures included procedures to reduce spending on Goods and Services as well as the Purchases of Capital Assets together with the abolishment of non-critical vacated posts to reduce spending on Compensation of Employees.
- In Programme 2 the Department spent 95.6 percent of its allocated budget and had an underspending of R53.3 million. The majority of underspending in the Programme was due to delays in the implementation of the Tourism Incentive Programme projects. Contractual negotiations together with the requirement for additional environmental impacts studies delayed the implementation of various projects scheduled to take place in the 2016/17 financial year.
- In Programme 3 a total of 98.4 percent of the budget was spent with R0.9 million under-expenditure. The underspending in this programme was mainly due to cost containment measures implemented by the Department in compliance with instructions received from the National Treasury. These measures included procedures to reduce spending on Goods and Services as well as the Purchases of Capital Assets together with the abolishment of non-critical vacated posts to reduce spending on Compensation of Employees.
- In Programme 4 the Department spent 94.7 percent of its budget with R23.8 million under-expenditure. The bulk of the underspending was due to funds allocated to the Expanded Public Works Programme Incentive which was not approved by the Department of Public Works for spending. These funds will therefore be relinquished back to the National Treasury as unspent funds.
- South African Tourism
South African Tourism continued on the poor performance trajectory in the fourth quarter of the 2016/17 financial year. This has serious implications for the overall annual performance for the organisation.
5.1 Achievement of targets
South African Tourism failed to achieve most of their predetermined objectives in Quarter four. Fourteen (14) quarterly targets were set for the quarter but only five (5) were achieved and nine (9) were not achieved. This means only 35.7 percent of targets were achieved and 64.3 were not attained. The continued poor performance in Quarter 4 meant that South African Tourism did not perform well in the 2016/17 financial year.
Tracking the performance of SAT throughout the financial year reveals a bleak picture for the year under review. South African Tourism had fourteen targets for the 2016/17 financial year. In the first quarter it was difficult for the Committee to ascertain the achievement of targets due for reporting as SAT distorted reporting period. In the second quarter seven (7) performance targets were set but only one (1) was achieved. In the third Quarter 14 targets were set but only four targets were achieved and five (5) were not achieved, whilst other five were not due for reporting as per Annual Performance Plan.
This is a cause for concern as the overall performance of the tourism sector in South Africa rely on good performance by SAT. These include amongst others, international arrivals; tourism revenue generation; and ultimately job creation.
- Assessment of predetermined objectives for the fourth quarter
The Committee noted that although South African Tourism (SAT) had 14 targets for the fourth quarter only 13 were reported on. The target on the “Reviewed leisure tourism market portfolio” was not included in the table detailing organisational performance over the fourth quarter. The Annual Performance Plan has an annual target of “Approved market portfolio” due for reporting in the fourth quarter. This target is based on the “Approved market portfolio model” that was targeted for the second quarter. The 13 quarterly targets reported on are assessed as follows:
- Number of international tourist arrivals achieved
SAT overachieved on this target. A total of 2 490 713 international arrivals was targeted for the fourth quarter but 2 625 412 was achieved. SAT indicated that the reasons for overachievement on this target were based on the improved value for money due to the depreciation of the rand; improved perception of safety vis-a vis the world competitive environment; economic recovery by some source markets; additional visa facilitation centres across China; re-introduction of a direct air route from Brazil and China; and various in-market promotional activities.
- Number of domestic holiday trips achieved
South African Tourism failed to meet the target for the number of domestic trips. The continued under performance on this target throughout the year meant that fourth quarter target was below by 15 percent. The reason for underperformance was driven by an overall decline in number of trips taken in quarter 4 from 8.4 million in 2015 to 7.1 million in 2016. This affected the general achievement of the annual target which was below by 14 percent. The main reason for underperformance advanced by SAT throughout the financial year was affordability remained the main deterrent to taking a trip. Underperformance on this target is worrying given that SAT was appropriated additional budget to activate domestic tourism. The Committee acknowledged the strategies being implementing to change this situation. “We Do Tourism” is one such campaign and the Committee will be conducting oversight on this intervention to see how it is received by South Africans.
- Total tourism revenue achieved (in billions)
South African Tourism underperformed on this target. The under-performance was driven mainly by a 10 percent decrease in Total Domestic Direct Spend (TDDS) from the same period in 2015. The decline in TDDS came from an overall decline in number of domestic trips taken in this period. There was also a decline in Total Tourist Foreign Direct Spend (TTFDS) due to the overall decline in spend per arrival from R9 490 in 2015 to R7 851 in quarter 4 of 2016. The implications of reduced tourism revenue generation is the decrease in the potential of the tourism sector to create the much needed job opportunities and boost the economy of the country.
- Percentage of brand positivity achieved
South African Tourism failed to achieve this annual target. The reason advanced by SAT is that SA Tourism’s funding has been significantly impacted by the depreciating rand against major currencies and increasing inflation resulting in currency loss. This impacted SA Tourism’s ability to market South Africa as a top of mind tourism destination at the same rate given the declining international budget.
Consequentially, SA Tourism's impact on brand positivity in the Core and Investment markets has declined below target in the following markets. Core: Australia (26 percent), France (38 percent), Germany (39 percent), Nigeria (36 percent), UK (35 percent) and USA (38 percent). Investment: Canada (27 percent), Ghana (25 percent), Japan (5 percent), South Korea (8 percent) and Uganda (36%). Positivity in core markets is at 39 percent and investment markets at 27 percent.
The Committee urges SAT to ensure that country brand is entrenched in the source markets to strengthen the country’s brand equity. This is critical given the increased brand awareness of source markets about other African countries and competitors in the African market space. Marketing activities should therefore be carefully adapted to source markets and maximise resource usage to get better Return on Investment. Allocation of resources is therefore key in ensuring presence of South Africa in the key markets. Number of business events hosted in South Africa
Current information indicates that South African Tourism failed to meet the target on the number of business events hosted. At the time of reporting SAT had registered 117 Conferences on the ICCA Database against 138 planned as the annual target. SAT reported that the audit process on the number of ICCA events was not yet completed at the end of the quarter but still not provided four months after the quarter. Clarity should be provided as to when the audit process will be finalised to get the final audited numbers. SAT is urged to set this target as a quarterly target in the subsequent financial years to allow the Committee to track performance against business events hosted in the country. The challenge of non-performance is partly caused by the lack of information to assist the Committee to track progress during in-year performance.
5.2.6 Number of business delegates hosted in South Africa
South African Tourism did not achieve this target. At a time of reporting it was indicated that only 68 408 delegates attended the 117 ICCA registered events against the 77 567 annual target. The same reason as in the number of business events hosted was given, that the audit process on the number of business delegates was not completed at the end of the quarter.
- Number of graded establishments
South African Tourism failed to meet the quarterly target thus the annual target. A total of 1 558 was targeted for the fourth quarter but only 1 211 was achieved. This meant that a total of 5 354 graded establishments were recorded as at end March 2017 against 5 650 annual target indicating 5.2 percent underperformance. SAT indicated that there was a net cancellation of 1 013 establishments with 252 of these being new establishments that applied for star grading membership but failed to pay the membership fees.
The Committee was not satisfied with this performance, especially reasons given by establishments on cancellation. Feedback should also be constantly given on the effectiveness of the current basket of benefits. The Committee is also aware that SAT is currently undergoing the restructuring of the grading system and more clarity is needed on this issue.
- Number of graded rooms
SAT failed to meet this quarterly target. A total of 25 783 of graded rooms were recorded by the end of the quarter against 33 851 target. The total number of graded rooms as at end March 2017 was 118 869 which was an underperformance of 3.1 percent. There were 252 new applications that failed to honour the membership invoices which accounted for 4 864 graded rooms.
In addition to the review of the grading scheme SAT should address the issue of Master Assessors. Some provinces share Master Assessors and this might be affecting the presence of SAT in some provinces and thus enrolment in the grading scheme.
- Stakeholder satisfaction score
South African Tourism failed to meet a target of setting a baseline as the stakeholder satisfaction survey was not conducted by the end of the fourth quarter. This was caused by the delayed consultation process on the Tourism Growth Strategy that was to precede the survey. This talks to internal delays which may be due to poor planning.
The Committee was not satisfied with the reasons given for why the consultation process on the Tourism Growth Strategy was delayed leading to failure in achieving the set target. The Committee was also concerned about the lack of clear feedback on how the employees have reacted to the changes in the organisation and whether this has not affected their commitment attitudes to their work responsibilities.
- Stakeholder engagement matrix in consultation with stakeholders
This target was achieved. The stakeholder engagement matrix has been included in the Stakeholder Management Framework and is aligned to the stakeholders that were surveyed during the Ministerial Review as well as those identified as important/ influential in delivering against business objectives.
- Staff satisfaction score
This annual target was not achieved. The target was set at 3.7 percent but only 2.9 percent was achieved. SAT indicated that the report identified the training and development; pay and benefits; and South African Tourism’s operations in jurisdictions other than South Africa find it difficult to implement some aspects of the PFMA and National Treasury Regulations as areas that need improvement.
This should be considered together with the vacancy rate. Currently SAT is operating at 77 percent (157), capacity against the approved staff establishment of 202. The remaining 23 percent (45 vacancies) recorded as vacancies as a percentage of headcount. To ensure business continuity and fulfilment of the vacant roles, SA Tourism has appointed temporary staff and interns. SAT had indicated earlier that vacancy rate was due to restructuring. The Committee was not satisfied with the non-achievement of this target as there was no indication of the effect of the staff satisfaction score on the capacity of the organisation to attract and retain staff. This target is critical to ensure that the organisation is populated by satisfied personnel as it plays a pivotal role in achieving the tourism imperatives in the country.
- Unqualified audit report
SAT indicated that this target was achieved. This was however reported prematurely as the audit outcomes for the 2016/17 financial year have not been reported on by the Office of the Auditor-General yet. The unqualified audit opinion referred to in the report is for the 2015/16 financial year. This might be the issue of reporting time, however the Committee is yet to receive the audit opinion from the Office of the Auditor-General for the 2016/17 financial year.
- Percentage of staff turnover
An annual target of 7 percent for staff turnover of was set. However, the staff turnover due to voluntary terminations was 6.6 percent. SAT should indicate what they mean by voluntary terminations and how this is affected by the working conditions in the organisation as indicated by the staff satisfaction score.
- Expenditure analysis
In the fourth Quarter South African Tourism spent R135 927.21milllion on administration and R 156 377.03 million on marketing activities. By the end of the quarter a total of R 352 140.57 million had been spent on Administration and R 929 481.08 million on marketing activities. In total, SAT spent R 1 281 621.65 which is 73 percent of budget spent on marketing and 27 percent on Administration, which includes compensation of employees. This expenditure is against the total budget of R 1 316 803 which was appropriated to SAT for 2016/17 as reported. The financial performance for SAT indicates that there was an under-expenditure of R35 181 000 in the 2016/17 financial year.
- Committee observations
The Committee observations are divided into the issues pertaining to both National Department of Tourism and South African Tourism.
Observations for the National Department of Tourism
5.4.1 ATC programme and criteria – the Committee observed that the Department had implemented most of the recommendations of the Inter-Ministerial Committee on the unintended consequences of migration regulations. The Accredited Tour Company (ATC) programme had been successfully implemented in China. However, the visa waiver for Russia removed the need for the ATC programme in that country. In India and countries in Africa the introduction of the ATC programme was seen as not having any significant impact and was not encouraged.
- Investment Master Plan – the Committee acknowledges the importance of this plan in boosting investments into the tourism sector. The plan aims to assist the Department and other institutions to target national and foreign investors for development of the tourism sector in support of the national development objectives. The committee urged the Department to ensure that the projects identified are ready for investment.
- Blue Flag Programme – the Committee observed that the implementation of the Blue Flag Programme offers many benefits such as improved tourism facilities, enhanced management of coastal ecosystems, increased awareness of the opportunities offered by the coast, and capacity building of coastal municipalities. However, in its current form, the Programme does not solve the challenges faced by municipalities in complying with the four broad criteria covering environmental education and information provision; water quality; environmental management; and safety and services. The Blue Flag Programme will be effective if it encompasses these criteria and ensures that some municipalities which withdrew from the programme are re-enrolled.
- Integration of provincial staff – the Committee noted that the process of integrating the staff members that were formerly based in provinces was underway. The Department indicated that provincial staff have been taken into consideration during the structuring process. Some have preferred to be incorporated to provincial departments. The Department assured the Committee that no employees will be left out or retrenched. The Committee will follow this process of integration closely.
- Projects timelines – the Committee observed that the Department was failing to meet its pre-determined objects due to delays in necessary approvals. The importance of factoring in Environmental Impact Assessment timelines when projects are included in the annual performance plan to avoid unnecessary non-compliance becomes critical in implementing projects timeously.
- Capacity building programme at municipal level – the Committee expressed concerns that the initiatives at national level are well coordinated, however, at local level the situation is not the same. Regardless of the explanation given by the Department that there is formal and informal training offered, municipalities remain the missing link in the tourism value chain. The Department is implementing interventions through formal training offered through the University of Pretoria. This is however not adequate to solve endemic challenges at local government level.
- Oversight on SAT – the Committee acknowledges that the Department conducts oversight over South African Tourism on two fronts, namely, governance and Strategy. The Department endeavours at all times not to dictate on what the strategy should be. The Committee commends the autonomy given to South African Tourism by the Department. However, the Department should ensure that South African tourism accounts for all the sector National Tourism Sector Strategy indicators depended on their performance. This included constant reporting on the number of jobs created.
- Signage – the Committee noted that the Department continues to struggle in coordinating provision of brown tourism signs, particularly for important tourism sites. The main concern is with world renowned attractions such as the Mandela Capture Site. The Committee expressed concerns on the non-action demonstrated by the Department of Transport through SANRAL regarding this site with regard to directional signs.
Observations for South African Tourism
5.4.9 Authentic visitor experience – the Committee had observed that tourists want an authentic South African experience. SAT was found wanting in facilitating packages that offer a memorable community experience. SAT conceded that the experience has something to do with how the products are packaged. The entity agreed that tour packages need to include heritage routes, adventure, township life and experiences that showcase daily lived experiences of Africans. Interventions were being made to involve tour operators through road shows internationally, and through the market intelligence and insights. This is important to gain knowledge on what markets want to tailor make tour packages.
- Target setting – The Committee was concerned that some targets were not realistic and achievable due to dependence on other departments. Some targets were also dependent on other pre-determined objectives which meant non-achievement in one leads to under-performance in another. SAT should look into various Key Performance Indicators and decide whether to consolidate and group others together.
- Delegate boosting – the Committee was concerned about limited delegate boosting to maximise benefits from business tourism. The SAT highlighted that their Executive Team did discuss the matter extensively as there the organisation was still using old traditional way of doing things. It had been agreed to look at other ways for delegate boosting, including benchmarking with provincial authorities such as Wesgro. The Committee would follow up on this matter.
- Capacity building programme at municipal level – the Committee expressed the same concerns as with the Department, that the initiatives at national level are well coordinated, however, at local level the situation is not the same. SAT undertook to intensify their coordination with local government through provincial authorities.
- Road shows – the Committee commended the roadshows conducted by SAT on We Do Tourism to align its work with the provinces.
- Price differentiation – the Committee argued that affordability for citizens could be improved if there was price differentiation for charges between local and international tourists. This may include dynamic and dual pricing options. This may also include varied charges for specific periods where people are encouraged to access cultural and heritage attractions at reduced price.
After making a number of observations the Committee recommend to the Minister as follows:
6.1 The Department of Tourism should work closely with provinces to develop investment portfolios for the projects that were identified in the Investment Master Plan in order to make them ready for investments.
6.2 The Department should work with coastal provinces and municipalities to ensure that major beaches are enrolled in the Blue Flag Programme and maintain their status.
6.3 The Department should consider implementing infrastructure projects as multi-year projects where the first year is dedicated to all the necessary approvals, including the Environmental Impact Assessments, and the second/ subsequent years to construction in order to avoid delays.
6.4 The Department and South African Tourism intensify their support and collaboration with provinces and municipalities in rolling out their programmes.
6.5 The Department further engages the Department of Transport and SANRAL to facilitate provision of signage to major tourism attractions, including the Nelson Mandela Capture Site.
6.6 South African Tourism facilitates packaging of authentic tours that depict the daily living conditions of ordinary South Africans to tap into the growing market that requires such products.
6.7 South African Tourism improves on setting pre-determined objectives to ensure effective implementation and compliance with the Annual Performance Plans.
6.8 The National Conventions Bureau should improve on delegate boosting initiatives to maximise economic benefits of business tourism.
The Committee was generally satisfied with the fourth quarter performance for the Department of Tourism. The Department had improved from the poor performance in Quarter 3 and this was seen as a good move towards achieving the annual targets. The Department continued to struggle with delays caused by Environmental Impact Assessment. These had a negative impact on the service delivery against the Annual Performance Plan. The Committee had raised these issues throughout the financial year and the Department was still not able to improve. It is against this background that the Committee advices the Department to ensure that all approvals are acquired before initiating construction of infrastructure projects.
The Committee was not pleased with the performance of South African Tourism as the entity continued to under-perform against its annual Performance Plan. More scrutiny will be done on the work of South African Tourism to engender expected performance. Poor performance by South African Tourism affects.
Report to be considered
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