DEPARTMENT OF PUBLIC DEPARTMENT OF PUBLIC WORKSWORKS

PORTFOLIO COMMITTEE ON PUBLIC WEORKSPORTFOLIO COMMITTEE ON PUBLIC WEORKSPARLIAMENT OF SOUTH AFRICAPARLIAMENT OF SOUTH AFRICA

13 FEBRUARY 201313 FEBRUARY 2013CAPE TOWNCAPE TOWN

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Purpose of the Presentation by the Department of Public Works

-To reflect on the Quarter 3 information and financial performance of the Department of Public Works in the financial year 2012/13

Objective of the Portfolio Committee on Public Works

-Briefing by the Department of Public Works on the third quarter performance of the department for 2012/13.

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The third quarter’s progress may be attributed to Turnaround’s strategy. Turnaround has 18 projects that are knotted into the programmes of the Department.

Progress on some projects

Immovable Asset Register project

• focused was on the confirmation of properties devolved to provinces and the confirmation of properties deemed to belong to National DPW

• Confirmation process is about 80% complete with teams currently following up certain anomalies to ensure that the correct properties are reflected in the asset registers of National DPW, Provincial DPWs and the DRDLR

• Issues pertaining to the devolution of the rates budget and the status of asset registers in the provinces were discussed in the December MinMec and Special MinMec in January 2013

• There is also a process of defining an approach to value IAR using fair value and in this case, applications were made to Office of the Accountant-General

• The Department obtained state land audit from the Chief Surveyor General for input to the IAR project

• The Department obtained the User Asset Management Plans prepared by the CSIR from Defence

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Lease management

• A team led by the service provider/Programme Manager was deployed to all 11 regional offices across the country to assist with the backlog.

• The DPW is in the process of establishing a Lease Advisory Committee that will advise the Director-General on the signing and approval of the lease documents relating to new leases, leases in the process of renewal/ extension, as well as expired and month-to-month leases

Supply chain management

• A draft on the revision of the Supplier Register Directive and application form has been prepared.

• A draft on SCM Policy that incorporates all applicable circulars and practice notes issues by the National Treasury and CIDB was developed

• In terms of enhancing skills, regional SCM coordinators and officials were trained.

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Building of skills in DPW – capacity and capability / reduction of vacancies

• There is a focus on building the eroded capacity and technical skills in the Department.

• The turnaround project on building skills is currently working with the Council for Built Environment (CBE) on qualifications processes and also assists in developing professional and technical skills.

• About 220 professionals have been identified to assist in this regard (100 has been approved)

Re-opening of Workshops

• Workshops serve a large part of the business of the Department in terms of maintenance.

• In recognition of the important role played by this function, the project is underway to re-open workshops in the regions – priority at phase 1 will be Pretoria and Cape Town

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Output Performance Indicator

Annual Target Quarterly target(Q3)

Actual progress against target

Approved Internal Audit Plan     

Internal Audit plan developed and approved annually by May

1 Internal Audit plan approved by May 2012 by Audit & Risk Management Committee. 

  Internal Audit Plan (Annual & Three Year Plan) approved by ARMC on 29 May 2012.

Internal Audit Reports (Consolidated for Common Audits , and or individual);  Progress Report to Audit & Risk Management Committee            

Internal Audit plan implemented ad Audit reports issued to EXCO and Audit and Risk Management Committee

9 Internal Audit reports issued quarterly to EXCO and Audit and Risk Management Committee

30% of Audit Plan Executed and reports issued.

Partially Achieved 19.38%: (Cumulative for the year, as at 31 Dec 2012 is 41%);Details of Progress is as follows: 

Completed Audit Projects (Reports Issued):a. HR Staff

Composition Statistics Analysis (IT Audit – Reporting Phase- Summary of findings)

a. Transfer Payments - Other

Highlights

•Performance on internal audits improved in Q3 compared to Q2 due to assistance received from National Treasury through secondment of a Director to oversee Head Office Internal Audits sub directorate. •performance on investigations declined as the budget was depleted•New ARMC members have been appointed and already inducted.•Independent review of management actions plans provides assurance to management on effectiveness of actions implemented and improvements•The sub-programme co-leads the Turnaround Priority Project 5 – Anti Fraud and Corruption Awareness Campaign.

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Performance Indicator

Annual Target Quarterly target(Q3)

Actual progress against target

Reduced vacancy rate

Vacancy rate is reduced to 15% as at 31st March 2013

16.5% reduced vacancy rate

Vacancy rate currently at 15.33%  - 5665 filled posts - 1026 vacant posts - 36Posts advertised:

      - 44.59% are Women in SMS positions- 1.22%People with disabilities:   - 9 Retentions/Counter offers/ salary reviews - 4 Secondments/movements - 2 Transfers to the Department - 71 Appointments: 31 are contracts 40 permanent- 40 contract extensions - EE Policy consulted with all employees for inputs - Retention Policy in final consultation stage- HR Plan in consultation process for inputs

Highlights

•Additional capacity in the Department is taking various forms

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Effective management of employee relations

100% statutory compliance

Functioning of DPW Grievances- 72 received this quarter. 59 finalized and 13 pending. -17 grievances emanating from the previous quarter and previous financial year were finalized this quarter. Misconduct- 18 received this quarter. 09 finalized and 09 pending. -08 misconduct cases emanating from previous financial year and previous quarter were finalized this quarter. Appeals- 05 received this quarter -05 finalized and 00 pending this quarter.  Disputes- 09 received this quarter, 02 disputes finalized.  01 dispute emanating from previous financial year were finalized this quarter,  

Grievances •76 overall grievances were finalized this quarter.

Misconduct •17 overall misconduct cases were finalized this quarter.

Disputes•03 overall disputes were finalized this quarter).

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Performance Indicator

Annual Target

Quarterly target(Q3)

Actual progress against target

Number of meetings co-ordinated

12 meetings coordinated with Inter-Governmental Structures

3 meetingscoordinated withintergovernmentalstructures 

11 meetings were coordinated, namely:  Handover of computers at Qebedu JSS in the EC. Stakeholders involved DPW reg. Office, SADTU, and SGBMeeting on bridges with DOD DEC DPW.Stakeholders meeting in preparation of EPWP Summit were convened. Participated in KSD Presidential Intervention Project

15 briefing sessions with Parliamentary committees and 5 oversight visits

5 briefing sessionswith Parliamentarycommitteescoordinated 

8 Brief sessions with Parliamentary Committees were coordinated, namely: Briefing on DPW’s Annual report and Entities Annual Reports. 

30 internal top governance structure meetings coordinated

5 internal topgovernance structuremeetings coordinated 

The internal Top Management Meetings (Governance Matters) 

• Meeting reflect the concurrent mandate –

• MinMec and HOD forums

• Meetings reflect governance structures

• Effective coordination and follow-ups on resolutions is important

• Improvement in the quality of reporting on resolutions made in all the minister’s meetings with the entities

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Output Performance Indicator

Annual Target Quarterly target

(Q3)

Actual progress against target

To produce a complete and accurate immovable asset register on the assets by 31 March 2014

Number of properties populated with essential information.

Populate 10 929 properties

Populate 2 732 properties.

10 627 land parcels verified through desktop analysis and updated with Deeds Web and GIS.

C-AMP Document

Approved Custodian Asset Management Plan (C-AMP) and implementation programs.

100% C-AMP compile DPW CWIP and PMIP

C-AMP 100% completed. Compile DPW CWIP and PMIP

54% of

C-AMP review completed

Increased Revenue

Increase in revenue generation.

.

Increase revenue by R1 643 372

Increase revenue by R410 843

R35 481 revenue

received as a result of new leases signed by Regional Offices through AIM’s initiatives.

Highlights

•Deeds review completed•Data base received from Dept of Defence as well as from the Chief Surveyor General (CSG) to enhance DPW’s Asset register•Desk top review completed and DPW’s Verification process under way

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Output Performance Indicator Annual Target Quarterly target(Q3)

Actual progress

against target  Inner City Master

Planning: Accepting the proper role and responsibility of government in the City in terms of sustainable policy for change, relevant master planning, and justified regeneration through refinement of government’s footprint to create a modern “government estate” and the packaging of adequate and intelligent head office accommodation solutions for project execution

Inner City land availability Agreement between DPW and the City of Tshwane

Final Agreement on land availability

Land identified for DoJ Head Office

Salvokop as a future major government estate, within a well-balanced and sustainable mixed-use precinct, fully integrated with the Tshwane

Salvokop Spatial Design Framework

PMOs acceptance of SDF

Urban design concluded to form basis of township establishment

Precinct Plans iro: Salvok

op

Final Precinct Plan

Salvokop Precinct Plan completed

Salvokop bulk infrastructure SLA with City of Tshwane

Final Infrastructure Report

Infrastructure report completed

Highlights

•Feasibility study in respect of DPW Workshops site in Minaar Street completed.

•Site to be used for DPW needs instead of co-using the site for taxi purposes

•CoT is busy compiling a land availability document•Infrastructure Projects registered on WCS•Motivated for and obtained funding for Infrastructure Projects

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Output Performance Indicator Annual Target Quarterly target(Q3)

Actual progress against target

NYS learners recruited

Number of youth participating in the NYS 

3 500 to participate in NYS

2 500 to participate in NYS

1 366 learners participating in NYS

Technical Support provided to municipalities implementing projects

Number of municipalities reporting on EPWP targets

260 municipalities to report on EPWP targets

200 municipalities to report on EPWP targets

202 Municipalities reported on EPWP targets

Number of EPWP work opportunities across all spheres of government reported to EPWP

Total number of work opportunities created through EPWP

Create 1 210 000 work opportunities

Create 800 000 work opportunities

Raw data not yet available

Provincial roads projects implemented and reported on EPWP

Total number of EPWP work opportunities created on provincial access roads

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Create 100 000 work opportunities

107 714 as at beginning of January 2013 (not final)

Integrated grant disbursed to eligible public bodies (municipalities)

% on the incentive disbursed

70% 65% 74%

Integrated grant disbursed to eligible public bodies (provincial departments)

% on the incentive disbursed

70% 65% 96%

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Output Performance Indicator Annual Target Quarterly target (Q3)

Actual progress against target

Tabling of draft Agrèment SA Bill in Parliament.

Agrèment South Africa (ASA) established as a public entity by 31 March 2013.

Receive approval from JEC for the creation of a Public Entity.

Table ASA Bill in Parliament. RIA is currently being revised. Draft 3 of the ASA Bill is currently being finalised.

Draft Built Environment Professions (BEP) Policy.

Legislative framework for the BEP amended within the 2012 – 2015 period. 

Tabling of BEP Bill(s) in Parliament.

Consultation process with Professions.

Draft BEP Policy developed and circulated for comments.  Consultation with internal stakeholders currently underway.

Tabling of the Expropriation Bill in Parliament.

New Expropriation Bill tabled in Parliament by 31 March 2013, to ensure consistency with the Constitution and uniformity in the expropriation of property by all organs of state.

Tabling of Bill in Parliament. Tabling of Expropriation Bill in Parliament.

Expropriation Bill (Draft 9) and draft cabinet memorandum seeking approval to publish draft Bill for public comment submitted for approval. Comprehensive presentation to MinMEC on progress with Draft Bill developed.

13 approved Policy Frameworks.

Review Public Entities Legislation impacting on DPW.

13 Policy Frameworks approved.

3 Policy Frameworks developed.

Draft Accreditation Policy revised and submitted to CBE for final consideration prior to submission by CBE for approval.  CPD & Professional Registration policies being redrafted for comments.

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Leadership stability

Internal re-alignment at senior level (new posts DDG- Risk Management, DDG – SCM)

Positive effects of Turnaround intervention not yet realised (significant positive impact in 2013/14 & beyond)

Keys Stabilisation projects rolled outCompilation of the Immovable Assets RegisterReview of LeasesClean Audit Project

Enhancement of Department’s Technical Capability fully underway with appointment of technical professionals

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ProgrammeBudget

Allocation2012/13

Exp as atDecember

2012

% Spent as at 31Decemb

er2012

% Spent as at 31

December2011

  R'000 R'000

Prog 1. Administration 1,047,813 482,600 46% 74%

Prog 2. Immovable Asset Management

5,038,348 3,697,207 73% 71%

Prog 3. Expanded Public Works Programme

1,728,812 1,332,660 77% 55%

Prog 4. Property and Construction Industry Policy Regulation

37,436 20,450 55% 80%

Prog 5. Auxiliary and Associated Services

38,839 52,007 136% 80%

Total 7,891,248 5,585,924 71% 68%

Assuming a linear benchmark of 75%

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Expenditure for all Programmes with the exception of Programme 5 is in line with the guideline.

High expenditure in Programme 3 is due to payments for transfers and subsidies for incentives which are in line with the payment schedule.

Overspending in Programme 5 is due to payments relating to State Functions. A request for the adjustment of funds has been made to National Treasury for the funds to be allocated to offset the overspending.

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Economic classification

Budget Allocatio

n2012/13

Exp as atDecember

2012

% Spent as at 31

December2012

% Spent as at 31

December2011

R'000 R'000

Compensation of employees

1,329,951

1,036,087 78% 76%

Goods and services 783,270 430,382 54% 67%

Office Accommodation 469,052 137,152 29% 62%

Transfers and subsidies4,201,01

13,581,827 85% 76%

Infrastructure 999,254 374, 841 38% 45%

Machinery and equipment

108,710 25,036 23% 51%

Total 7,891,248 5,585,924 71% 68%

Assuming a linear benchmark of 75%

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The overall actual expenditure as at the end of quarter 3 is R5.6 billion, 71% of the total allocation, 4% below the linear benchmark of 75%.

Compensation of employees expenditure to-date at R1.036 billion is 78 % , 3% above the linear benchmark –

Goods and Services expenditure for end of December is R430 million, equivalent to 54% of the total allocation.

Expenditure for Office Accommodation is R137 million equivalent to 29% of the total allocation of R469M.

Transfers and subsidies expenditure at R 3.5 billion, 85% of the allocation of R4.2 billion, 10% above the linear benchmark of 75 %

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As alluded to before, this however is in line with the payment schedule

Infrastructure expenditure actual expenditure for Q3 is R374 million against an allocation of R999 million, represents 38% of allocation.

Expenditure is far below the Linear Benchmark 75% and under spending is therefore projected.After providing for all commitments, under expenditure at 31 March 2013 is projected at R162 million.

Machinery and equipment expenditure is R25 million which represents a mere 23% of the total allocation of R108 million.

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Devolved

FundsInvoiced

AmountReceived

%’ageReceive

d

O/standin

g

State-Owned R3.9 B R3.2B R2.3B 73% R0.9B

Invoiced

Amount Received

%’ageReceiv

ed

O/standing

Private leases R1.9B R1.2B 64% R0.7B

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73% of the amounts invoiced have already been received. (This represents 60% of the amount to be invoiced for the year).

46% of the outstanding debt relates to accounts outstanding for more than 120 days

97% of outstanding amounts in total relates to current year

Clients are resistant to pay as we are still not in a position to compile itemized billing

Engaging with the OAG for an approval to continue invoicing on the basis of the devolution until the IAR programme is complete.

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20% of the money received against this item relates to prior years.

64% of amounts invoiced have been received.

73% of the outstanding amounts for the current financial year are less than 90 day.s

R33 million (1.8%) has not been claimed as it relates to disputed properties where the

Client either disputed occupation or the rental being paid.

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National Department of Public Works (NDPW)Head Office: Public WorksCGO BuildingCnr Bosman and MadibaPretoria CentralPrivate BagX65Pretoria0001Website: http://www.publicworks.gov.za