Financial and Fiscal Commission Strategic Plan...

Financial and Fiscal Commission

Strategic Plan

2011/2012 – 2013/2014

Standing Committee on Finance

April 2012

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Key Commission Focus Areas for 2011/2012 Financial Year

• Providing evidenced-based policy advice on Intergovernmental Financing

Innovation for Moving People out of Poverty under the following sub-

themes:

– Supporting Inclusive Growth: Jobs, Knowledge and Regional Development

– Climate change and environmental sustainability: Opportunities and risks for

inclusive growth and innovation

– Institutional development for inclusive growth and innovation

• Recommendations to be tabled as part of Commission 2013/2014

Submission for the Division of Revenue

• Responding to outcomes of Stakeholder Perception Survey and Impact

Assessment (Role and Mandate of Commission; Commission Profferings

and their value-add)

– Public Hearings on Local Government Fiscal Framework and Housing

Financing in October 2011 based on draft Problem Statement tabled by

Commission

– Second set of Public Hearings in current Financial Year to present an options

• Reduction of legacy R3.4m Deficit

– Injection received from National Treasury

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Key Commission Challenges for 2011/2012 Financial Year

• Burden carried by Commission under significant resource constraint\

– 3 Vacant Commission posts some since June 2008

– Restricted levels of depth and breath in expertise, strategic approach,

research as well as oversight because of vacancies

• Uncertainty due to absence of substantive Chairperson of the Commission

– Burden carried by Acting Chairperson/CE as sole Executive

Commissioner and also Chief Executive of the Commission

– Commissioner Ajam has played a supportive role

• Absence of Engagement Protocols to guide the interaction between

Parliament and the Commission

• Resource implications of the implementation of the Money Bills Procedures

and Related Matters Act

Part I

Financial and Fiscal Commission Corporate

Strategy

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Mandate of the Commission

• The Commission is established in terms of Section 220 of the

Constitution of the Republic of South Africa Act No. 108 of 1996 as

amended

• The Constitution provides among others that the Commission is an

independent and impartial advisory institution to Parliament,

provincial legislatures, organised local government and other

organs of state on

– the division of revenue among the three spheres of

government

– Any other financial and fiscal matters

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Enabling Legislation

• The Intergovernmental Fiscal Relations Act No. 97 of 1997 as

amended

• The Financial and Fiscal Commission Act No. 99 of 1997 as

amended

• The Municipal Systems Act No. 32 of 2000 as amended

• The Provincial Tax Regulation Process Act No. 53 of 2001 as

amended

• The Municipal Finance Management Act No. 56 of 2003 as amended

• The Intergovernmental Relations Framework Act No. 13 of 2005 as

amended

• The Municipal Fiscal Powers and Functions Act No. 12 of 2007.

• Money Bills Amendment Procedures and Related Matters Act No. 9

of 2009

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Composition

• Commission consists of:

– Full time Chairperson and Deputy Chairperson (national nominees)

– Chairperson also the Chief Executive and Accounting Officer

– Seven other Commissioners (two national, three provincial and two local

nominees)

– All appointments are made by the President of the Republic

– Current Vacancies :

• Chairperson: Term expired end of August 2010 and Deputy Chairperson

acting since (21 months)

• Local Government nominee: Vacant since July 2009 (33 months)

• National Government Nominee: Vacant since July 2009 appointee never

took up position and resigned February 2011 (33 months)

Vision

To enhance the developmental impact of public resources

through the financial and fiscal system in South Africa

Mission

To provide proactive, expert and independent advice on

promoting a sustainable and equitable IGFR system, through

the formulation and collation of policy relevant analysis, in

order to realise the values of the Constitution

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Strategic Goals: 2011/2012 – 2013/2014

The following are the major strategic goals or key focus areas of the Commission:

1. A stable IGFR System: The system of Inter-governmental Fiscal Relations (IGFR) is

sustainable and equitable

2. Strategic foresight: “No surprises” and future-oriented

3. Sound and informed policy advice: Effective policies that are evidence-based result

from comprehensive and value-added engagement

4. Knowledge management: Relevant knowledge that enhances developmental impact is

created and mobilised through the balance of internal and external specialist talent

commensurate with the needs of the Commission

5. “Success” culture: A dynamic, productive organisational culture is created and nurtured

6. Balance: The balancing of present and future demands, leading to effective performance

within the constraints of available resources

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How Are We Doing? 2011/2012 Achievements

– Strategic Goal 1: A stable IGFR System

• Participated in the Strategic Planning Processes of Standing Committee on

Appropriations and Oversight Functions of Parliament Finance, Appropriations,

Energy, Health, Economic Development, Women, Children and Disabled, COGTA,

Human Settlements; Participated in the activities of the technical committees of

finance

– Strategic Goal 2: Strategic foresight

• Commission is part of the institutions at the fore front of research into issues of

innovation, climate change and the green economy; monitored the impact of fiscal

consolidation and financial management concerns at provincial (i.e. interventions) and

local level (sustainability), Commission is also participating in the long term fiscal

sustainability studies that government is currently carrying out.

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– Strategic Goal 3: Sound and informed policy advice

• Released Technical Report that supports Commission 2012/2013 Submission for the

Division of Revenue

– Strategic Goal 4: Knowledge management

• Developed unique models : Land Use Cost Model, Econometric Models on

the National and Provincial Economy, Energy focused macro-model.

• Maintain Province and Municipality datasets and preserved for future use

• Dissemination of Commissions work through workshop to parliamentary

committees, public hearings and media reports.

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– Strategic Goal 5: Success culture

• Published in accredited international and national journals

• Produced book chapters, technical reports, occasional papers, conference

papers and working papers

– Strategic Goal 6: Balance

• Expenditures within variance limits prescribed by Auditor General

• Balance of in-house and outsourced capacity

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Enhanced developmental impact of public resources through the financial and fiscal system in South Africa

system in South Africa

Proactive, expert and independent advice

provided on promoting a sustainable and

equitable IGFR system.

Effective and efficient secretariat support compliant with the relevant legislation

Stakeholders value and act upon FFC policy advice to

realise the values of the Constitution

Effective management

of FFC research project

portfolio in line with

Research Strategy

Effective

packaging and

dissemination of

policy advice

Quality, innovative

policy-relevant

research

conducted

Stakeholders

intensively

engaged on

key IGFR

policy

decisions

Domestic and

international

partnerships,

networking and

collaboration

Good,

responsible,

ethical leadership

and management

Good practice

corporate governance

compliant with

legislation

Accountable,

transparent financial

management

Coordinated, cost

effective asset

management

Human Resource

management that attracts,

develops and retains

talent, and leverages

external expertise

Coordinated, cost-

effective knowledge,

and information

management

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How Are We Doing?

– Deliverables

Tabled 2012/2013 Submission for the Division of Revenue

Briefed Parliament, Provincial Legislatures (except the Western Cape

Provincial Legislature), SALGA and Government on the 2012/2013

Submission for the Division of Revenue

Submission on 2011 Medium Term Budget Policy Statement

Submission for the Division of Revenue and 2012/2013 Division of

Revenue Bill

Submission and briefed Parliament and Provincial Legislatures on

2012/2013 Division of Revenue Bill

Submission and briefing Parliament on 2012/2013 Fiscal Framework and

Revenue Proposals

Submission on and briefing Parliament on 2012 Appropriations Bill

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How Are We Doing?

• Deliverables:

– Submission on Siyenza Manje Project for Select Committee on Finance

– Submission on Green Paper on Cooperative Governance for the

Department of Cooperative Governance

– Submission on Fuel Levy Allocations for the Department of Energy and

National Treasury

– Submission on MISA Strategy for the Department of Cooperative

Governance

– Submission on the Spatial Planning and Land Use Management Bill for

the Department of Rural Development and Land Reform

– Submission on the 2011 Amendment to the Municipal Systems Act for the

Department of Cooperative Governance

– Submission on the 2011 Municipal Property Rates Amendment Bill for

National Treasury

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How Are We Doing?

• Deliverables cont ...

– Conducted Analysis of Local Government Revenue and Expenditure: The

Case of Free State Municipalities for Free State Provincial Legislature

– Submission on eThekwini Metropolitan Municipality Application for Local

Business Tax for National Treasury

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How Are We Doing?

– 2011/2012 Research

Overall Theme

o Intergovernmental Financing Innovation for Moving

People out of Poverty

Sub-themes

o A. Supporting Inclusive Growth: Jobs, Knowledge and

Regional Development

Fostering and anticipating new areas of growth

Employment progression, the better utilisation of skills and

improving the quality of local jobs

Building adaptability and progression

Good local governance for job creation

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How Are We Doing?

– Research cont ...

o B. Climate change and environmental sustainability:

Opportunities and risks for inclusive growth and

innovation

Disaster management

Waste management

Climate change and rural economy

o C. Institutional development for inclusive growth and

innovation

Alternative service delivery arrangements

Capacity dynamics in the Local Government sphere

Gender budgeting

Impact of revenue and expenditure assignment on economic

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Part II

Strategic Objectives and Annual

Performance Plan

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Strategic Objectives 2011/2014

Stakeholder Internal Business Processes Learning and Innovation Financial

To profile the Commission with a

special focus on the Commission’s

Mandate, Vision, Mission and Role,

the Commission’s Short- and Long-

Term Strategy, the Commission’s

position on specific issues, the

Commission’s Challenges and

Achievements

To ensure the progressive and

innovative management of human

resources that attracts, develops and

retains key talent, and leverages

external expertise

To ensure the creation of new

knowledge, the institutionalization of

such knowledge and its transfer to

other role players within the

intergovernmental fiscal relations

system

To ensure prudent and transparent

management of the financial

resources of the Commission

To ensure that Commission research

is converted to policy advice and

recommendations written in a

language that is accessible to

policymakers

To ensure the coordinated, coherent,

high-quality, innovative and cost-

effective approach to ICT that meets

the needs of the Commission, the

Commission Secretariat and

stakeholders

To ensure the coordinated, cost-

effective and innovative acquisition

and management of Commission

data, information and knowledge

resources in support of delivery on

the Commission’s mandate

To ensure access to alternative

sources of funding

To ensure that policy advice and

recommendations respond to the

needs of stakeholders

To ensure the coordinated, cost-

effective and innovative management

of Commission assets in support of

delivery on the Commission’s

mandate

To ensure the generation of quality,

innovative, pioneering research that informs key IGFR strategic debates

and choices

To ensure compliance with

legislation and adherence to relevant corporate governance best

practice.

To produce evidence-based results To ensure effective and responsible

leadership with specific focus on

integrity, transparency and

accountability, as well as on the

development a positive

organisational culture.

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Stakeholder Engagement Strategic Objectives and Key Performance

Indicators 2011/2012 – 2013 /2014

1. To profile the Commission with a special focus on the Commission’s

Mandate, Vision, Mission and Role, the Commission’s Short- and Long-Term

Strategy, the Commission’s position on specific issues, the Commission’s

Challenges and Achievements

Target Status Target

2011/2012 2011/2012 2012/2013

Indicator 1: Dissemination and clarification of outputs to a wider audience

Website upgrade, Social Media presence and

engagement with other Parliamentary Committees in

addition to Finance Committees

Achieved 14

Committees.

Government

briefing.

Website

upgrade.

Twitter,

Facebook and

LinkedIn

presence.

8 Provincial

Legislatures.

SALGA

Website and Social Media enhancement; 18

Parliamentary Committees, 9 Provincial Legislatures;

Government; and Organised Local Government

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Indicators 2011/2012 – 2013 /2014






2011/2012 2011/2012 2012/2013

Indicator 2: Stakeholder instruction on IGFR and IGFR issues

2 Stakeholder IGFR Workshops Partially

achieved.

Standing

Committee on

Appropriations.

Gauteng

Legislature

cancelled

because of

tolling protests.

2 Stakeholder IGFR Workshops

Indicator 3: Relationship building and consultation

2 Protocols of Engagement Not achieved.

6 pending

2 Protocols of Engagement

2 Public Hearings Achieved 2 Public Hearings

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Indicators 2011/2012 – 2013 /2014






2011/2012 2011/2012 2012/2013

Indicator 4: Collaboration and partnership

2 Memoranda of Understanding with partners Achieved

HSRCSA and

FANRPAN

2 Memoranda of Understanding with partners

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Indicators 2011/2012 – 2013 /2014

2. To ensure that Commission research is converted to policy advice and

recommendations written in language that policymakers can understand

Indicator: Clear language edited Submissions, Reports and Policy Briefs


2011/2012 2011/2012 2012/2013

Submission on Division of Revenue Bill, Submission on

Fiscal Framework and Revenue Proposals, Submission

on Appropriations Bill, Annual Submission on Division

of Revenue, Annual Report, Submission on Medium

Term Budget Policy Statement, Section 3(2)(b)(i) and

(ii) of the Financial and Fiscal Commission Act

Submissions, and Policy Briefs

Achieved Submission on Division of Revenue Bill, Submission on

Fiscal Framework and Revenue Proposals, Submission

on Appropriations Bill, Annual Submission on Division

of Revenue, Annual Report, Submission on Medium

Term Budget Policy Statement, and Section 3(2)(b)(i)

and (ii) of the Financial and Fiscal Commission Act

Submissions and Policy Briefs

3. To ensure that policy advice and recommendations respond to the needs of

stakeholders

Indicator: Attendance at stakeholder forums

Representation and participation where applicable at

State of the Nation Address; Budget Speech; Budget

Lekgotla, Council and Forum; MinMecs; Technical

Committees on Finance; Parliamentary, Provincial

Legislature and Local Government House and

Committee Hearings, Workshops and Planning

Sessions

Achieved Representation and participation where applicable at

State of the Nation Address; Budget Speech; Budget

Lekgotla, Council and Forum; MinMecs; Technical

Committees on Finance; Parliamentary, Provincial

Legislature and Local Government House and

Committee Hearings, Workshops and Planning

Sessions

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Indicators 2011/2012 – 2013 /2014

4. To ensure the generation of quality, innovative, pioneering research that

informs key IGFR strategic debates and choices


2011/2012 2011/2012 2012/2013

Indicator 1: Peer-reviewed publications in an accredited journals

Number of articles published by Commission

researchers during period under review (13.6)

Partially

achieved

(11.6). Staff

movements

Number of articles published by Commission

researchers during period under review (13.6)

Indicator 2: Recognised book chapters or working papers or technical reports published

Number of book chapters, technical reports,

occasional papers, conference papers and

working papers with Commission researchers

listed as authors or co-authors (22)

Achieved Number of book chapters, technical reports,

occasional papers, conference papers and

working papers with Commission researchers

listed as authors or co-authors (22)

Indicator 3: Number of Commission research datasets/model codes/syntax archived for future use

Number of unique datasets developed and

preserved for future use (22)

Achieved Number of unique datasets developed and

preserved for future use (22)

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Indicators 2011/2012 – 2013 /2014

6. To ensure the progressive and innovative management of human resources

that attracts, develops and retains key talent, and leverages external

expertise


2011/2012 2011/2012 2012/2013

Indicator 1: Organisational Development (OD)

Restructuring of Commission delivery model Not

achieved.

Resource

constraints.

Restructuring of Commission delivery model

Indicator 2: Updated human resource management policies and procedures

Review of Protected Disclosures Policy, Health

and Safety Policy and Email Policy, and

development of Employee Assistance and

Employee Wellness Programmes Policies and

Procedures

Achieved Review of Performance Management System

and Policy

Indicator 3: Performance Management that is fair, equitable and consistent

20% SMS and 25% MMS receive performance

bonus

Achieved 20% SMS and 25% MMS receive performance

bonus

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Indicators 2011/2012 – 2013 /2014



expertise


2011/2012 2011/2012 2012/2013

Indicator 4: Minimum level of unoccupied but budgeted posts

Less than 15% of budgeted but vacant posts Achieved. Less than 15% of budgeted but vacant posts

Indicator 5: Reward and recognition of staff in terms of Commission Policy

Remuneration of staff not below levels

prescribed by DPSA

Achieved Remuneration of staff not below levels

prescribed by DPSA

Indicator 6: Minimum level of absenteeism

Less than 5% Achieved Less than 5%

Indicator 7: Maintenance of acceptable levels of misconduct and discipline

Less than 3% of total staff compliment Achieved Less than 3% of staff compliment

Indicator 8: Targeted training and development as per organisational training and development plan

At least three (3) days per employee Achieved At least three (3) days per employee

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Indicators 2011/2012 – 2013 /2014



expertise


2011/2012 2011/2012 2012/2013

Indicator 9: Maximised Gender balance

SMS 60 male/40 female; MMS 60 male/40

female; Organisational 60 male/40 female

Not

achieved.

SMS 60 male/40 female; MMS 60 male/40

female; Organisational 60 male/40 female

7. To ensure the coordinated, coherent, high-quality, innovative and cost-effective

approach to ICT that meets the needs of the Commission, the Commission

Secretariat and stakeholders

Indicator 1: ICT Strategy and revised ICT Policies and Procedures

Approved ICT Strategy, Policies and

Procedures

Partially

achieved. ICT

Strategy and

Business

Continuity

Plan in place

Review of all ICT Policies and Procedures

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Indicators 2011/2012 – 2013 /2014

7. To ensure the coordinated, coherent, high-quality, innovative and cost-

effective approach to ICT that meets the needs of the Commission, the

Commission Secretariat and stakeholders


2011/2012 2011/2012 2012/2013

Indicator 2: Upgraded ICT Infrastructure (Hardware and Software)

Retirement of pre-2007 infrastructure per plan Partially

achieved.

Second

server and

copier

replacement

finalised.

Backups in

place

Retirement of outstanding pre-2007

infrastructure per plan

Indicator 3: Streamlined ICT Network and Connectivity

Reconfiguration of ICT Network and

connectivity

Partially

achieved.

Audit

finalised.

Appointment of new service provider and roll-

out of network

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Indicators 2011/2012 – 2013 /2014

7. To ensure the coordinated, coherent, high-quality, innovative and cost-


Commission Secretariat and stakeholders


2011/2012 2011/2012 2012/2013

Indicator 4: Proactive and efficient maintenance of ICT hardware and desktop support to users

Appointment of service provider Achieved.

Service

provider

appointed

Less than 8 hours downtime

8. To ensure the coordinated, cost-effective and innovative management of

Commission assets in support of delivery on the Commission’s mandate

Indicator 1: Review and implement Facilities Management Policies and Procedures

Review Travel Policy, Asset Management

Policy and Telephone Usage Policy

Partially

achieved.

Audit

finalised.

Appointment of new service provider and roll-

out of network

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Indicators 2011/2012 – 2013 /2014

8. To ensure the coordinated, cost-effective and innovative management of

Commission assets in support of delivery on the Commission’s mandate


2011/2012 2011/2012 2012/2013

Indicator 2: Asset Management and utilization Plan (Fixed and Movable Asset Registers)

Develop asset management and utilisation plan Partially

achieved.

Asset register

revised

Approve and implement asset management

and utilisation plan

Indicator 3: Minimum year-round maintenance requirements for assets as per Commission Maintenance Plan

Develop asset maintenance plan Partially

achieved.

Useful life

audit finalised

Approve and implement asset maintenance

plan

Indicator 4: Office Space commensurate with Commission resources and requirements

Reduce Midrand Office Space by 42%

Reduce Cape Town Office Space by 50%

Partially

achieved

Midrand:

DPW delays

Cape Town:

Lease expires

January 2013

Reduce Midrand Office Space by 42%

Reduce Cape Town Office Space by 50%

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Indicators 2011/2012 – 2013 /2014

9. To ensure compliance with legislation and adherence to relevant corporate

governance best practice.


2011/2012 2011/2012 2012/2013

Indicator 1: Comply with legislated advisory requirements by responding in writing to written requests for advice

Comply with stakeholder requests for

advisories and comment

Achieved Comply with stakeholder requests for

advisories and comment

Indicator 2: Table Annual Report to Parliament, provincial legislatures and organised local government

September 2011 Achieved September 2012

Indicator 3: Conduct of Commission business in accordance with the law, the Commissions Codes of

Governance, the Commission’s Policies and Procedures, and best practise

Comply with the law, policies and best practise Achieved Comply with the law, policies and best practise

10.To ensure effective and responsible leadership with specific focus on integrity,

transparency and accountability, as well as on the development a positive

organisational culture

Indicator: Performance Reviews and Assessments

Quarterly performance reviews Achieved Quarterly performance reviews

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Indicators 2011/2012 – 2013 /2014

10.To ensure the creation of new knowledge, the institutionalization of such

knowledge and its transfer to other role players within the intergovernmental

fiscal relations system


2011/2012 2011/2012 2012/2013

Indicator 1: File Plan for electronic and paper-based documents

Syntax and Terms of Reference for File Plan Achieved Develop File Plan for approval by National

Archives

Indicator 2: Active documentation of experiences

Develop Records Management Policies Achieved Approval and implementation of Records

Management Policies

Indicator 3: Capture, storage and sharing of knowledge presented in the form of documents

Digitisation of paper records Not achieved.

Resource

constraints

Digitisation of paper documents

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Indicators 2011/2012 – 2013 /2014

11.To ensure the coordinated, cost-effective and innovative acquisition and

management of Commission data, information and knowledge resources in

support of delivery on the Commission’s mandate


2011/2012 2011/2012 2012/2013

Indicator 1: Collection Development Manual

Revise library and knowledge management

strategy and policies, and collect development

manual

Partially

achieved Approve revised library and knowledge

management strategy and policies, and collect

development manual

Indicator 2: Access to virtual resources

Secure and maintain Wizcat access Achieved Secure and maintain Wizcat access

Indicator 3: Library Materials Exchanges

Secure reference materials on loan from

partner institutions

Achieved Secure reference materials on loan from

partner institutions

Indicator 4: Memoranda of Understanding

Conclude and maintain memoranda of

understanding on exchanges with partner

institutions

Achieved Conclude and maintain memoranda of

understanding on exchanges with partner

institutions

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Indicators 2011/2012 – 2013 /2014

11.To ensure the coordinated, cost-effective and innovative acquisition and

management of Commission data, information and knowledge resources in

support of delivery on the Commission’s mandate


2011/2012 2011/2012 2012/2013

Indicator 5: Reference Books

Cost effectively acquisition of at least 4

reference books

Achieved Cost effectively acquisition of at least 4

reference books

12.To ensure prudent and transparent management of the financial resources of

the Commission

Indicator 5: A clean audit

Unqualified Audit Opinion with matters of

emphasis

Pending Unqualified audit opinion without matters of

emphasis

13. To ensure access to alternative sources of funding

At least 5% of budget allocation Not achieved At least 5% of budget allocation

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2009/2014 Research Strategy: Components and Programmes

• Equitable Growth Paths and Distribution of Public Resources

– Macroeconomic analysis

– Growth, Poverty and Inequality

– Revenue sharing among and within government spheres – vertical and horizontal

divisions

– Progressive Realisation

• Sustainable Development

– Infrastructure, services, social welfare (impact on vulnerable groups)

– Environmental economics, including green economy

– Knowledge Economy

• Accountable Institutions (at the different spheres and layers of government)

– Taxation and other revenue sustainability options

– Expenditure diversification

– Institutions running these and fiscal accountability

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2009/2014 Research Strategy: Components and Programmes

cont ...

• Stakeholder Requests (flexible/ad hoc)

– Legislation proposals with a financial and fiscal impact

– Other unforeseeable referrals

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2012/2013 Thematic Focus and Research Projects

• 2012/2013 Thematic Focus

– “Levers to Unlock Value for Decadal Development: People, Places,

Institutions and the Economy”

• 2012/2013 Research Projects

– Analysing Child Support Grants using Economy-wide Models

– Framework and Tools for Understanding Green Job Creation in South Africa

– Budget Consolidation in South Africa: A Disaggregated Approach

– The Effects of Social Spending on Economic Activity in South Africa

– Short-term Forecasting Model for South Africa

– Dynamics and Implications of Provincial Personnel Expenditure on Service Delivery

– Harnessing Informality into the Main Stream of Humans Settlements Delivery in South

Africa

– Evaluation of Public Transport Operating Subsidies in South Africa

– Devolution and Delivery of Transport Infrastructure: Intergovernmental Implications for

Municipalities

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2012/2013 Thematic Focus and Research Projects cont ...

– An Integrated Planning Approach to Delivery of School Infrastructure

– Intergovernmental Dynamics of Sub-national Government Budget Gaps and

Implications for South Africa’s Fiscal Health

– An Outcomes Based Approach to Service Delivery in a Decentralized System of

Government

– Conditional Grant Performance Assessment

– Incentives For Rewarding Performance in the Public Sector

– Challenges, Constraints and Best Practices in Rehabilitating Water and Electricity

Distribution Infrastructure

– Understanding the Dynamics of the Tax Bases of Rural Municipalities and the

Constraints in Raising Revenue in these Areas

– Determinants of Performance of Municipalities in South Africa: A Cross Sectional

Analysis

– Budget Reforms of the Health Conditional Grants and Strengthening of Health

Performance

– The Impact of No Fee Schools Policy on Equity, Funding and Learner Performance

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2012/2013 Thematic Focus and Research Projects cont ...

– Identifying Gaps and Progress Made with Government Outcomes: A Spatial

Approach

– Fiscal Rules and Long Term Modelling

– Role of Provincial Governments in Meeting National Priorities

– Revision of the Division of Revenue Bill

– Impact of Unfunded Mandates

– The Role of Intergovernmental Fiscal Relations (IGFR) in Innovation Financing in

South Africa

– Analysing Public Economics of Corruption

– Fiscal Distress Indices

– Public Hearings: Local Government Fiscal Framework and Housing Financing

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Relating Expenditure to Strategic Objectives

Name of the Objectives Medium-term estimate

R Thousand 2012/13 2013/14 2014/15

Name of the Objectives 37,268 38,289 40,429

1 5.1.4 To ensure the generation of quality, innovative, pioneering research that

informs key IGFR strategic debates and choices 18,199 18,545 19,503

Compensation of employees 9,162 10,431 10,862

Use of goods and services 6,962 8,114 8,641

Interest, dividends and rent on land

Transfers and subsidies

Other

2 5.1.5 To produce evidence-based results 588 620 657

Compensation of employees

Use of goods and services 588 620 657



Other

3 5.2.4 To ensure compliance with legislation and adherence to relevant corporate

governance best practice. 6,230 7,044 7,466





Other 4 Prudent and transparent management of financial resources 4,285 3,993 4,232





Other

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Relating Expenditure to Strategic Objectives

Name of the Objectives Medium-term estimate

R Thousand 2012/13 2013/14 2014/15

Name of the Objectives 37,268 38,289 40,429

5 5.2.1 To ensure the progressive and innovative management of human

resources that attracts, develops and retains key talent, and leverages external

expertise 2,478 2,614 2,770


Use of goods and services 584 617 654



Other 6 5.2.2 To ensure the coordinated, coherent, high-quality, innovative and cost-


Commission Secretariat and stakeholders 1,276 1,346 1,427

Compensation of employees 247 263 279




Other 7 5.2.3 To ensure the coordinated, cost-effective and innovative management of

Commission assets in support of delivery on the Commission’s mandate 4,212 4,127 4,374





Other 314 315 339

8 - - -

Compensation of employees

Use of goods and services



Other

Other

Total 37,268 38,289 40,429

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Funding

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Financial Performance Audited Results Unaudited Current Budget Allocation

Description 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14

Government Grant 9,258 12,038 12,679 18,382 19,899 21,705 27,496 26,125 26,580 31,391 33,036 37,268 39,159

Other Income 646 248 108 53 208 780 500 240 97 402 160 173 183

Revenue 9,904 12,286 12,787 18,435 20,107 22,485 27,996 26,365 26,677 31,793 33,196 37,441 39,342

Grant increase % -100% 30% 5% 45% 8% 9% 27% -5% 2% 18% 5.24% 12.81% 5.07%

Staff Costs 5,101 5,731 7,191 7,935 8,463 12,759 16,223 15,879 17,641 19,524 19,603 19,604 20,682

Depreciation & Amortisation 719 650 1,094 878 909 1,035 1,079 977 780 580 413 500 400

Professional Service 845 559 601 511 508 343 1,004 3,913 2,501 4,099 4,650 6,589 6,841

Other Operating Expenses 2,812 4,231 6,070 7,392 9,139 11,344 8,248 6,993 6,111 8,445 7,275 8,658 11,263

Interest 4 226 318 166 27 44 57 145 158 7 -

TOTAL 9,481 11,397 15,273 16,883 19,046 25,525 26,611 27,906 27,190 32,655 31,941 35,351 39,186

Surplus/ Decificit 423 889 -2,486 1,553 1,060 -3,040 1,385 -1,541 -513 -863 1,255 2,090 155

19 20 23 22 29 39 35 30 34 34 34 34 34

Headcount increase % 5% 15% -4% 32% 34% -10% -14% 13% 0% 0% 0% 0%

Personell as % of total costs 53.8% 50.3% 47.1% 47.0% 44.4% 50.0% 61.0% 56.9% 64.9% 59.8% 61.4% 55.5% 52.8%

Annual Rate of pay 268 287 313 361 292 327 464 529 519 574 577 577 608

Staff Costs % increase 12% 25% 10% 7% 51% 27% -2% 11% 11% 0.40% 0% 5%

Increase % of Expenditure -100% 20.21% 34.01% 11% 12.82% 34.01% 4.25% 4.87% -2.6% 20.10% -2.19% 10.7% 10.85%

% of surplus/ deficit to revenue 4.27% 7.24% -19.44% 8.42% 5.27% -13.52% 4.95% -5.85% -1.92% -2.71% 3.8% 5.6% 0.4%

Financial Position

Asset Base- Non Current 426 2,126 1,872 1,037 2,020 3,132 2,363 1,474 919 840 427 -73 -473

Asset Base- Current 1,263 1,854 347 1,366 1,730 22 323 706 182 60 173 500 400

Total Assets 1,689 3,981 2,219 2,402 3,750 3,155 2,686 2,180 1,102 900 600 427 -73

Capital contribution 919 919 919 919 919 919 919 919 919 919 919 919 919

Accumulated Deficit/ surplus 371 1,260 -1,226 327 1,388 -1,652 -267 -1,808 -2,321 -2,911 -1,656 434 589

Total Liabilities 399 1,802 2,526 1,156 1,444 3,888 2,035 3,069 2,504 2,892 1,637 1,861 2,280

Total reserves & Liabilities 1,689 3,981 2,219 2,402 3,750 3,155 2,686 2,180 1,102 900 900 3,214 3,788

Acid Test 3.168 1.029 0.138 1.181 1.198 0.006 0.159 0.230 0.073 0.021 0.106 0.269 0.175

Acid Test Movement 0.540 -2.138 -0.892 1.043 0.017 -1.193 0.153 0.071 -0.157 -0.052

44 FFC

Analytical information

• Since establishment revenue grant grew by average of 20% with a healthy reserve ratio of 1:2.

• In 2006/7 FFC experienced a 14% deficit (R1.6m) due to business growth thus resulting in erosion of reserves.

– All time low acid test ratio of 0.006 reported.

• Business growth was evidenced by 34% increase in headcount (39) and 13% (R12.7m) increase in personnel costs, 40% in audit fees and steady increase of stakeholder management costs.

• Going Concern and the accumulated deficit of the Commission

– Commission has engaged the National Treasury and Parliament in 2011/12 financial year in order to stabilize its liquidity.

– As a result grant funding grew by 12% (R3m) in 2012/13 financial year out of those engagements with both Parliament and National Treasury.

– The overall baseline allocation grew by 7 Million over the MTEF period to address the accumulated deficit.

• The Commission will seek to source additional funding through partnerships with donor organizations in 2012/13 to deal with mutually beneficial initiatives that the Commission is unable to carry out on its current budget, including training of its research staff

– Joint initiatives were piloted with the Limpopo Provincial Treasury, Ekurhuleni Metro and the Free State Finance Committee where the Commission partnered with these organs of state to carry out its work and in the process managed to save costs

– Such initiatives will be pursued even more going forward.

– Memoranda of understanding have been concluded with the Human Sciences Research Council (work is on-going funded by UNICEF on a project), Food and Agricultural Policy Research Network and the Municipal Demarcation Board to share capacity on joint projects of mutual interest

– 18th Anniversary IGFR Conference scheduled to take place this year.

45 FFC 45

Remarks on budgets

In order to restore a good financial position with the none changing of the base line allocations the followings expenditure items are still being maintained

• RRP should be the major beneficiary

• Freeze on new recruitments

• Phasing in of projects

• Continuation with reducing administrative costs

• Reprioritisation the Implementation of the FFC’s Strategy

• Compliance with allocations

• Austerity measures still continue in order to reduce deficit

• Reducing number researchers travelling per trip

• Travelling on economy class

• Car rental reduced to a lower grade

• Office space: finalising the lease with DPW.

46 FFC Copyright

Thank You

Financial and Fiscal Commission Strategic Plan...

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