TABLE OF CONTENTS - North West 30... · TABLE OF CONTENTS PART A: GENERAL ... SABS - South African...

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TABLE OF CONTENTS

PART A: GENERAL INFORMATION………………………………………..............……...….…...........…...…. 3

1LIST OF ABBREVIATIONS / ACRONYMS.............................................................................. 5

2 FOREWORD BY THE MEC…………………………………............………………………………...................... 7

3 REPORT OF THE ACCOUNTING OFFICER…………………………………………..………………............... 9

4 STATEMENT OF RESPONSIBILITY AND CONFIRMATION OF ACCURACY OF THE ANNUAL

REPORT………………………………………………………………………..…..……............................................. 24

5 STRATEGIC OVERVIEW……………………………………………………………………............................... 25

6 LEGISLATIVE AND OTHER MANDATES………………………………………………............................. 26

7 ORGANIZATIONALSTRUCTURE………..……………………………….……………….................. ............ 27

8 ENTITIES REPORTING TO THE MEC………………………………..............…………........................ 28

PART B: PERFORMANCE INFORMATION………..…………………………………................…….......... 29

1 AUDITOR GENERAL’S REPORT : PREDETERMINED OBJECTIVES…………..............…..….... 30

2 OVERVIEW OF DEPARTMENTAL PERFORMANCE…………………………...................…….…...... .30

2.1 SERVICE DELIVERY ENVIRONMENT……...……………………..………......…………………............. 30

2.2 SERVICE DELIVERY IMPROVEMENT PLAN……………...………………....…............………........ 31

2.3 ORGANIZATIONAL ENVIRONMENT…………………………...........……...……………………........... 36

2.4 KEY POLICY DEVELOPMENTS AND LEGISLATIVE CHANGES..........………………............. 36

3 STRATEGIC OUTCOME ORIENTED GOALS…………………….............…............………………........39

4 PERFORMANCE INFORMATION BY PROGRAMME……..............………............……………….....40

4.1 PROGRAMME 1: ADMINISTRATION……………………..........................…………………….......... 40

4.2 PROGRAMME 2: INTEGRATED ECONOMIC DEVELOPMENT SERVICES…...................... 52

4.3PROGRAMME 3: ECONOMIC PLANNING AND SECTOR DEVELOPMENT......................... 57

4.4 PROGRAMME 4: BUSIENESS REGULATION AND GOVERNANCE .................................. 63

PART C: GOVERNANCE ......................................................................................................... 67

5.1INTRODUCTION……......…………………………………………………...........…......………….................. 68

5.2RISK MANAGEMENT…………………………………….....…………………………………..........................… .. 68

5.3FRAUD AND CORRUPTION…………………………….....………………...............…………….............. . 68

5.4MINIMISING CONFLICT OF INTEREST..........……….....…………………………………….............. 68

5.5CODE OF CONDUCT……………………………….......................……………………………….….............. 69

5.6HEALTH SAFETY AND ENVIRONMENTAL ISSUES……...............………………………….…........ 69

5.7SCOPA RESOLUTIONS……………………………………….......................…………….………............... 69

5.8PRIOR MODIFICATIONS TO AUDIT REPORTS……….......….....…………………….………......... 69

5.9INTERNAL CONTROL……………………………………….....................…………...…….....…............... 69

5.10REPORT OF THE PROVINCIAL AUDIT COMMITTEE..………………..................….............. 70

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PART D: HUMAN RESOURCE MANAGEMENT…………………...………..........................……...... 75

6.1INTRODUCTION………………………………………………………………..........................…............. 76

6.2 HUMAN RESOURCE OVERSIGHT STATISTICS……………………..........................………... 76

PART E: FINANCIAL INFORMATION ...............................................................................100

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PART A: GENERAL INFORMATION

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THE DEPARTMENT OF ECONOMY AND ENTERPRISE

DEVELOPMENT

NORTH WEST PROVINCE

NWDC Building

Cnr. University Drive & Provident Street

Private Bag X15, Mmabatho, 2735

Tel: (018) 387 7700

Fax: (018) 387 7901

Web: http://www.nwpg.gov.za/EED

email: [email protected]

mailto:[email protected]

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1List of Abbreviations / Acronyms

A AFS - Annual Financial Statement

B BAS - Basic Account System

BBEE - Broad-Based Black Economic Empowerment

C

CSIR - Council for Scientific and Industrial Research

D

DBSA - Development Bank of South Africa

DCA - Damage Causing Animal

DEDECT - Department of Economic Development, Environment, Conservation

and Tourism

DPWRT - Department of Public Works, Roads and Transport

DLGTA Department of Local Government and Traditional Affairs

DPSA - Department of Public Service Administration

DTI - Department of Trade and Industry

F

FDI - Foreign Direct Investment

FET - Further Education Training

G GCIS - Government Communications Information Services

GDS - Growth and Development Summit

GVA - Gross Value Added

H

HOD - Head of Department

I

ICT - Information Communication Technology

IDP - Integrated Development Plan

IDZ - Industrial Development Zone

IGR - Intergovernmental Relations

INW - Invest North West

IPAP - Industrial Policy Action Plan

L

LED - Local Economic Development

M

MEC - Member of Executive Council

MIDZ - Mafikeng Industrial Development Zone

MINMEC - Ministers and Member of Executive Council

MOA - Memorandum of Agreement

MOU - Memorandum of Understanding

MTEF - Medium Term Expenditure Framework

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MTSF - Medium term Strategic Framework

N

NDP - National Development Plan

NIPF - National Industrial Policy Framework

NSDP - National Spatial Development Perspective

NWDC - North West Development Corporation

NWGB - North West Gambling Board

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OHS - Occupational Health Safety

P

PFMA - Public Finance Management Act

PGDS - Provincial Growth and Development Strategy

PGMs - Platinum Group Metals

PPP - Public Private Partnership

Q

QPR - Quarterly Performance Report

R

RDP - Reconstruction and Development Programme

RIDS - Regional Industrial Development Strategy

S

SABS - South African Bureau of Standards

SALGA - South African Local Government Association

SAQA - South African Qualification Authority

SCOPA - Standing Committee on Public Accounts

SDI - Spatial Development Initiative

SDIP - Service Delivery Improvement Plan

SDF - Spatial Development Framework

SEZ - Special Economic Zone

SIC - Standard Industrial Classification

SMART - Specific, Measurable, Achievable, Realistic and

Time bound

SME - Small Medium Enterprises

SMs - Senior Management Services

SMME - Small Medium Micro Enterprises

SOE - State-Owned Enterprises

W

WCRD World Consumer Right Day

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2 FOREWORD BY THE MEC

Economic Development relates to ensuring

that the basic needs of people are met. The

Government of Bokone Bophirima is

determined to change the socio-economic

conditions of the previously marginalised

communities; mainly communities located in

the VTSD areas and will not deviate from the

Five Concretes as they serve as a basis for

implementation of the National Development

Plan (NDP).

The current economic conditions have re-

ignited our desire to double our efforts in the

implementation of the Five Concretes of the

Province in the implementation of the

programmes that seek to alleviate poverty,

reduce the unacceptable levels of

unemployment and address persistent

inequalities that continue to perpetuate in

Bokone Bophirima.

The current economic outlook should not

shake us, if anything; it should serve to

sharpen our tools for implementation of radical economic transformation programmes. It

should drive us to deliver the best possible public services with limited resources and I am

convinced that we will overcome this temporary setback of “junk status”. It compels us to

be cautious in allocating and redirecting scarce resources towards priorities.

The Department of Economy and Enterprise Development had in the 2015/16 financial year

obtained clean audit status. Whilst celebrating the positive audits, we are working tirelessly

with all departments to increase the number of “clean audits”.

The Department paid invoices within 30 days for the twelve months effective from April

2016 to March 2017 without fail;

Bearing this in mind, the Department of Economy and Enterprise Development, is entrusted

with the mandate to lead economic development and growth in the Bokone Bophirima

Province through designed legislative framework, policies and strategies, as currently

informed by the overarching National Development Plan.

The Premier of Bokone Bophirima, Honourable Mahumapelo has already laid the foundation

during the 2017 State of the Province Address when he re-affirmed the Fifth Administration‟s

commitment towards the implementation of the National Development Plan, pursuant to the

attainment of our radical socio-economic transformation agenda. Consistent with the

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Premier‟s call, the 2017/18 departmental budget commits FEED to the continued

implementation of the NDP and Five Concretes.

In conclusion, I wish to appreciate all the efforts of officials in the Department, the

participation of stakeholders, both from the private sector and the communities, as well as

colleagues in the Provincial Government for their support and understanding given.

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3 REPORT OF THE ACCOUNTING OFFICER

REPORT OF THE ACCOUNTING OFFICER FOR THE YEAR ENDED 31 MARCH 2017

1. OVERVIEW OF THE OPERATIONS OF THE DEPARTMENT

Important policy decisions and strategic issues facing the department

In terms of the Outcome Based approach, the Department has to respond to Outcome 4,

which deals with decent work through creating and all-inclusive economy, as well as

Outcome 12 for an efficient, effective and development orientated public service and an

empowered, fair and inclusive citizenship.

The Department of Economy and Enterprise Development has the responsibility to respond

to a number of policy imperatives, of which the following are but some of the policy

decisions and strategic issues to be considered:

National Development Plan (NDP)

The Presidency, through the National Planning Commission has developed a long

term strategic plan of Government through the National Development Plan. The

National Development Plan (NDP) offers a long-term perspective for development. It

defines a desired destination and identifies the role different sectors of society need

to play in reaching that goal.

New Growth Path

The new growth path is aimed at stepping up the fight against poverty and

unemployment in South Africa. This is a proactive response to the global recession

which took a heavy toll on the economy of the North West Province. The New

Growth Path extrapolates its thrust by latching onto IPAP to accelerate industrial

development in the country.

National Industrial Policy Framework (NIPF)

The National Industrial Policy Framework (NIPF) sets out government‟s broad

approach to industrialisation in the context of the Accelerated and Shared Growth

Initiative for South Africa (ASGI-SA) and its targets of halving unemployment and

poverty through accelerated growth of at least 6% by intensification of

industrialisation towards a knowledge economy beyond 2014.

Industrial Policy Action Plan (IPAP)

The Industrial Policy Action Plan (IPAP) sets out in detail key actions and timeframes

for the implementation of industrial policy. The publication of IPAP takes place within

the framework of continuous improvements and up scaling of concrete industrial

development interventions, as set out in the National Industrial Policy Framework

(NIPF). Successive iterations of IPAP seek to scale up key interventions over a rolling

three-year period, with a 10-year outlook on desired economic outcomes.

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Regional Industrial Development Strategy (RIDS)

The Regional Industrial Development Strategy (RIDS) is one of the strategic

programmes of the Industrial Policy Framework. RIDS fits within Strategic

Programme 9: Spatial and Industrial Infrastructure and aims to give effect to these

goals and to help close the gap between regions that, in particular, reflect the divide

between the first and second economies.

SMME Strategy

The SMME strategy aims to influence sustainability on enterprises, promoting

economic growth and development through entrepreneurship. The SMME strategic

thrust is to create and strengthen enterprise support services; implement mentoring;

skill development, incubation services for new and growing enterprises; establishing

SMME support units at local Municipalities; increasing visibility of the Department

through outreach programmes and information dissemination particularly to rural

communities; interact with ordinary members of the community and understand

challenges faced by SMME‟s within the rural communities; ensuring that the

enterprises comply with the BBBEE and Preferential Procurement policy

requirements; establish SMME forums to coordinate activities of the SMME

development.

VTSD

The 5th Administration has introduced a policy of growing the economies of Villages,

Townships and Small Dorpies in an endeavor to respond to economic development

challenges facing the province, it is projected that the economy of the province will

grow by 4% in 2015, 4.8% in 2016, and 5% in 2017 and 2018 respectively to

achieve a growth target of 6%. The focus of government will be on the development

of villages, townships and small dorpies. The strategy will be to target and diversify

the economies of these areas which will help to attain the economic growth target of

6% especially if driven by deliberate programmes to foster growth and development

in these areas. The intention is to induce growth at the VDTD level by creating a

favourable environment for attracting growth minded entrepreneurs, creating

capacity for innovation and attracting capital from other regions.

Significant events that have taken place during the year

During the year under review, the following significant events took place:

During the year under review 56 learners from Madibeng Local Municipality

successfully completed plumbing learnership program which is a collaborative

effort between the Department and the Construction Sector Training Authority

(CETA)

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The department has commenced with the roll out of a flagship SMME support

programme known as North West Growth Accelerator Programme. The

programme is primarily designed to identify and support SMMEs through a

comprehensive range of business growth oriented programmes, activities and

partnerships. 64 businesses across the Province have been listed for the first 12

months of the three year program.

The Sub-Programme hosted an exhibition for the promotion and information

sharing in relation to one of the oldest strategies applied in radical socio

economic development of villages, township and small dorpies, known as Stokvel.

The exhibition known as Stokvel Bokone Bophirima 2017 which was held from

the 10th to the 11th of March 2017, attracted a total of 30 exhibitors, the

department included. The objectives of the event were inculcating the culture of

cooperation towards common goals of bulk buying, investment promotion and

saving among communities.

The department entered into a Service Level Agreement to train SMMEs and

cooperatives on how to increase their productivity and grow their businesses.

The Department in partnership South African Bureau of Standards (SABS)

implemented a product development programme aimed at enhancing the quality

of products of the small businesses. 15 enterprises from different sectors

benefited from the programme which is designed to capacitate small business in

areas of Product Design, Labelling, Pricing and Market access.

Mokgalwana Youth Bakery in ward 29 Mokgalwaneng Village, was handed over to

the community.

The Department successfully hosted a symposium on reducing economic

vulnerability and releasing human capital of People with Disabilities.

FEED hosted VTSD Economic Lekgotla at Mmabatho Convention Centre from the

30th November to the 2nd December 2016. The Summit brought together an

audience of 500 delegates drawn from a variety of public and private sector key

stakeholders. The main theme of the discussion focused on the strengthening

stakeholder cooperation within Bokone Bophirima with the aim of bringing

sustainable development within our targeted VTSD‟s.

The VTSD Economic Lekgotla was part of a process that started in early 2016.

There were 2 phases prior the VTSD Lekgotla, firstly setting up of the

development plans, going into the VTSD areas to see what development, what

resources and opportunities are present in the VTSD areas. The second phase

was the establishment of VTSD chambers of commerce in all VTSD area bringing

all informal & formal business in the area under a chamber of commerce at Local

and District level. The VTSD Chambers of Commerce are seen as a platform that

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our SMMEs will be able to use to grow their businesses and in so doing, assist

government in its fight against the triple challenges of poverty, unemployment

and inequality

An opportunity had been identified to exploit the mineral resources that exist on

the farm 894 HN, Taung. The department had been assisting Batlhaping Ba Ga

Phuduhutswana in Taung to apply for mining prospecting rights. The aim of the

project is to benefit the Community and to stimulate economic growth and

development. The mineral resources opportunities that exist in the area include

lime, marble, slate, diamond, coal and oil. The department of Economy and

Enterprise Development will be assisting with the community with all necessary

application processes as required by the DMR for mining to take place.

The Consumer Court was launched and its first session was held on the 24th

March 2017.

A total of 293 out of 342 consumer complaints were resolved successfully and R

837 176 was retrieved on behalf of consumers in our Province. The Unit was able

to conduct investigations into market practices in remote rural areas as part of

the Setsokotsane Programme, where unscrupulous businesses were found to be

exploiting consumers. Non-compliant businesses were instructed to comply and

some were reported to relevant authorities.

Education awareness programmes were conducted in VTSD areas and 20 447

consumers were reached.

The department celebrated World Consumer Rights Day in Madibeng under the

theme “Consumer in the digital era”. Build up programmes were conducted in the

form of road shows and Blitz inspections where goods worth R250 000 were

confiscated and destroyed around Madibeng Municipality where the Main Event

was held.

The Provincial Liquor Act is now complete and signed by The Honourable

Premier.

The total numbers of 5 168 liquor outlets were inspected during the normal

compliance enforcements. 3 448 outlets were compliant with the Liquor Act No.

27 of 1989, as amended. 1 155 outlets were found non-compliant, 533 outlets

were not operating at the time of inspection, 32 outlets were verified at the

request of the Liquor Board.

The department together with the SAPS and other relevant stakeholders have

conducted joint operations starting from 18:00 to 02:00am in the morning to

check compliance on closing time, age group, and other compliance as required

by the Liquor Act. In all 609 outlets inspected, 383 outlets were found to be

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compliant with liquor legislation, 212 were non- compliant, and 14 outlets not

operating at the time of inspection.

The Liquor Unit was able to circumvent scams that tried to defraud liquor traders

by requesting them to make a deposit for a liquor licence admin fee into an FNB

account and later into an ABSA bank account.

The Liquor Unit conducted 108 liquor outreach programmes, and through these

interactions a total of 1 012 community members were reached.

A social responsibility programme was also conducted where issues of alcohol

abuse and health ills associated with it were addressed and families who are

negatively affected by alcohol abuse were assisted.

The Unit together with our stakeholders i.e. Department of Social Development

and DTI, conducted workshops in all four Districts during Liquor Month of

February. At each workshop 250 people attended as a build up to the Provincial

Liquor Event which was later held in Dr Ruth Segomotsi Mompati where 800

participants Attended. During the workshops and at the main Event presentations

on the new Liquor Act, Manufacturing and Distribution licenses and the alcohol

abuse made.

Major projects undertaken or completed during the year

Taung irrigation scheme – small scale maize producers

Tigane PwD Bakery in Tigane

Ous Angy Resturant Bakery in Wolmaranstad

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OVERVIEW OF FINANCIAL RESULTS OF THE DEPARTMENT

Departmental Receipts

2016/17 2015/16

R'000 R'000

Departmental Revenue Tax revenue

139,002

122,521

Sales of goods and services other than capital assets

2,713 81

Transactions in financial assets and liabilities

1,261 8

Total revenue collected

142,976

122,610

Programme Expenditure

The following are reasons for under-spending:

Administration under-spent by R2,977 million, this is as a result of delay in the

recruitment process which was finalised only after year end and R1,158 million

as a result of savings on security costs which was planned for the Mining

Lekgotla which was deferred due to change in the approach.

Integrated Economic Development Services under-spending by R0.931 million on

Compensation of employees due to the delay in the recruitment process which

was only finalised after year end.

Economic Planning and Sector Development under-spending by R1,139 million

on Compensation of Employees as a result of recruitment process which was

only finalised after year end.

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Impact on programmes and service delivery

Non-completion of organizational structure as a result of new requirements is working to the

adverse detriment of the service delivery, in that, the Department is operating on skeletal

staff, and it is unable to finalise the envisaged organisational structure.

Virements/Roll Overs (Done)

The following virements were made during the year:

During the financial year 2016/17 the department did not incur any unauthorised or

fruitless and wasteful expenditure. The department however incurred irregular

expenditure to the total of R 877 000.00.

Future Plans of the department

The table below depicts Departmental planned activities which are align to the Provincial

Concretes and Priorities:

Provincial

concretes Planned Activities

Villages,

Townships and

Small Dorpies

(VTSD)

• Education and awareness programmes to be prioritised

VTSD HIGH VALUE HIGH IMPACT PROJECTS

• Industrial laundry

• Phokeng Incubation Centre for People with disabilities

• Mahikeng Buy Back Centre

• SMME Growth Accelerator Program, TOP 100 SMME’s

• Borabalo Diamond cutting and Polishing

• Madikwe Sisal (2nd

Phase) Expansion

• Ventersdorp Olives Orchard

• Ventersdorp Vineyard Project • Motlopi Coffee Manufacturing

• Fluorpsar Beneficiation/ Value Add

• Clothing & Textile Manufacturing

ProgrammeAdjusted

Appropriation

Shiftings of

fundsVirements

Final

Appropriation

R 000 R 000 R 000 R 000

Administration 97 042 - (1 877) 95 165

Integrated Economic Development Services 52 944 - 116 53 060

Economic Planning and Sector Development 50 755 - 4 050 54 805

Business Regulation and Governance 105 574 - (2 289) 103 285

Totals 306 315 - - 306 315

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Provincial

concretes Planned Activities

• Goat Beneficiation

• Acacia Beneficiation

• Charcoal manufacturing

• Bakery Support Programme

• SMME Empowerment Fund

Reconciliation,

Healing and

Renewal (RHR)

• Liquor Social responsibility programmes

• Redress Mechanism offered through the Consumer Affairs Court • Wellness outreach programmes to disadvantaged communities

• Apprenticeship Skills Development with the Construction SETA 196 Learners

SETSOKOTSANE • Participation in the Setsokotsane programme through education and awareness programmes

• Business registration support services(Co-operatives and SMMEs) • Enterprise Skills Development workshops and support • Business Profiling within VTSD

SAMWERK-

SAAMTREK

• Liquor month celebration

• World Consumer Rights Day Celebration

• Stakeholder engagements with DFI’s, Universities etc

• CSIR Partnership of sustainable projects through VTSD

• Partnership with NWU, Development of Strategy to tap into economic opportunities through VTSD & ACT

Public Private Partnerships

o No Public Private Partnership when entered into during the year.

Discontinued activities / activities to be discontinued

o None

New or proposed activities

o None

Supply chain management

o There were no unsolicited bids proposals concluded during the year under

review

o The department incurred irregular expenditure to the total of R 877 000.00

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Gifts and Donations received in kind from non - related parties

o None.

Exemptions and deviations received from the National Treasury

o None

Events after the reporting date

o None

Other

o None.

2. Service rendered by the department

2.1 List of services

The Department‟s primary objective is to lead on matters relating to the achievement of

the economic goal as defined in the National Development Plan and also in the process

of being customised for the province. This plan does not negate the province‟s resolve

to reduce unemployment level by half and to spearhead participation of women, youth,

people with disabilities and SMME‟s in the mainstream economic activities of the

province with emphasis in the VTSD areas.

The department remains committed to achieving the objectives of economic growth and

job creation through the following objectives:

Small Business Development,

Provincial economic planning and development,

Research to determine economic potential and policy development,

Economic sector development

Industrial development facilitation,

Investment and Trade promotion,

Regulatory functions (consumer protection and liquor policy administration,

BBBEE policy compliance, gambling, tourism regulation amongst others),

Liquor and Business regulation

Effective and efficient administration of allocated resources to maximise returns

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2.2 Tariff policy

Fees are charged for rendering liquor administration to the liquor industry for

applications, transfers and renewal of licenses. Fees charged are prescribed by the

Liquor Act (Act number 27 of 1989).

2.3 Free Services

The department does not render any chargeable services for free.

2.4 Inventories

The Department does not maintain any form of inventory.

3. Capacity constraints

The Department has had organisational structure challenges for a long time but progress

has been made with adraft structure now being costed in preparation for submission to

the Premier‟s and the DPSA offices.

4. Utilisation of donor funds

Not applicable

5. Trading entities and public entities

North West Development Corporation responsible for small business

development as well as the management and development of property to stimulate

business development, especially Small Medium enterprises. This entity was merged

with Invest North West and Industrial Development Zone in line with government

resolve to strengthen economic development.

North West Gambling Board regulates the gambling industry in the Province and

is established under the North West Gambling Act No 2 of 2001.

The entities are managed by their respective Boards and report directly to Executive

Authority and to programme 3 Business Regulation administratively on a monthly basis.

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Organisation to whom transfer payment were made

2016/17 2015/16

R'000 R'000

North West Development Corporation

48,598 101,378

North West Gambling Board

77,154 64,661

CSIR

9,651 -

Com-licensing (Radio-and TV)

4 4

Leave Gratuity

194 187

Bursary( Non- Employees)

1,573 314

Households

5,576 11,576

Total

142,750 178,120

6. Public private partnerships (PPP)

No public private partnerships exist in the department.

7. Corporate governance arrangements

7.1 Risk Management Approach

7.1.1 Risk Assessment

Strategic, operational and Fraud Risk registers were reviewed and monitoring

performed by Risk Management Committee and Departmental Management

Committee on quarterly basis. Performance Agreements for senior management

constitute risk management as key performance area. Awareness sessions were held

for all staff members. Training was coordinated to nominated officials as risk

champions for each programme to assist risk owners with the implementation of risk

management in the department.

Leave Gratuity 2016/17 2015/16

Administration 64 161

Integrated Economic Development Services 0 26

Economic Planning and Sector Development 0 0

Business Regulation and Governance 130 0

Totals 194 187

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7.1.2 Risk Management Committee

Risk Management Committee with an independent chairperson was appointed during

the year and two out of four planned meetings were successfully held. In

discharging its governance responsibilities relating to risk management, the risk

management committee ensured that audit findings are cleared and strategic risk

treatment plans are implemented.

The department developed the risk maturity plan to ensure that the department‟s

risk management processes bears good benefits.

7.2 Fraud prevention

No incident of fraud or corruption was reported during the year. Awareness sessions

on PAJA (Promotion of Administrative Justice Act of 2000), PAIA (Promotion Of

Access to Information Act 2 of 2000) , Information Security Policy and whistle

blowing policy. Fraud and ethics committee held two meetings out of the four

planned meetings.

7.3 Effectiveness of internal control

The effectiveness of internal control is gauged by its ability to pick up all non-

compliant transactions and to ensure that corrective actions are taken, to report on

responses to agreed actions e.g. in the case of implementation of agreed actions to

be taken by managers to correct exceptions raised by the Auditor General and

Internal Audit as well as to continuously monitor relevance of financial policies and to

instigate amendments.

The effectiveness thereof is also monitored by Risk Management Committee and

Internal Audit and all concerns raised by the latter are immediately attended to.

7.4 Effectiveness of internal audit

Internal audit has been able to carry out all audits planned for the financial year.

Internal Audit committee has also been able to convene all sittings and deliberations

and advices given have added valuable impetus to the performance of the

department.

7.5 Other governance structures

The Provincial Treasury has also been effective in executing its PFMA mandate of

ensuring that financial and non-financial performance of the department is compliant

with legislation and guidelines.

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7.6 Implementation of code of conduct

Codes of conduct in the Public Service, as prescribed, are encouraged to be adhered

to by all employees in the department. Presentations on Code of Conduct are always

made during numerous events and workshops, thereby, continuously creating

awareness on the conduct.

7.7 Safety, health and environmental issues

Numerous events are being held by the Department to create awareness and

encourage employees to be critical of their health and well-being. These events fall

within the auspices of SHERQ.

The challenges the Department faces on the above matters are attributed to none

compliant of the leased buildings, where the landlords are not coming to the party

with regard to access and other compliant issues.

7.8 Conflict of interest

Declarations by official holding influential positions like SMS band and Departmental

Bid Adjudication Committee members are made to ensure that their positions are not

used to the detriment of functionality of the department.

7.9 Responsibilities of the Accounting Officer

For the year under review the Accounting Officer‟s responsibilities with regard to

transfer of funds, was limited to receiving quarterly reports and confirmation of use

of funds. The new organogram being developed has been designed in such a way

that reports received will be critically analysed and, where the need is evident, site

visits undertaken by our Monitoring Unit to ensure that visible deliverables are

confirmed. Failure to enter into an agreement linking deliverables with allocated

funds has also been identified as a huge risk and measurers developed include

signing of the Annual Performance Plans of entities excluded by TR 29.2

8. Discontinued activities/activities to be discontinued

None

9. New/proposed activities

None

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10. Asset management

Asset verification was conducted during the year and asset register updated with all

acquisitions and disposals.

11. Information on predetermined objectives

Programme Managers report quarterly on predetermined objectives in the prescribed

formats, giving reasons for deviations and giving action plans to correct under- or

non-achievements as well as providing portfolio of evidence where necessary.

Performance review sessions are held as an Extended Departmental Management

Committee meeting to assess extent of deviations and to agree on suitability of

corrective plans.

12. SCOPA resolutions and previous audit report

There were no SCOPA resolutions for the 2016/17 financial year

13. Prior modifications to audit reports

No modifications to previous audit reports have been made.

14. Exemptions and deviations received from the National Treasury

The North West Gambling Board is exempted by Provincial Treasury from

surrendering unspent monies transferred during the period under review.

15. Interim Financial Statements

Interim financial statements for the three quarters of 2016/2017 financial year were

issued as prescribed.

16. Other

None

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17. Approval

The Annual Financial Statements set out on pages 108 to 144 have been approved

by the Accounting Officer

PROF T THEKISO

HEAD OF DEPARTMENT

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4 STATEMENT OF RESPONSIBILITY AND CONFIRMATION OF

ACCURACY OF THE ANNUAL REPORT

To the best of my knowledge and belief, I confirm the following:

All information and amount disclosed throughout the annual report are consistent.

The annual report is complete, accurate and is free from any omissions.

The annual report has been prepared in accordance with the guidelines on the

annual report as issued by the National Treasury.

The Annual Financial Statements (Part E) have been prepared in accordance with the

modified cash standard and the relevant frameworks and guidelines issued by the

National Treasury.

The Accounting Officer is responsible for the preparation of the Annual Financial

Statements and for the adjustments made in this information.

The Accounting Officer is responsible for establishing, and implementing a system of

internal control that has been designed to provide a reasonable assurance as to the

integrity and reliability of the performance information, the human resources

information and the annual financial statements.

The external auditors are engaged to express an independent opinion on the annual

financial statements.

In my opinion, the annual report fairly reflects the operations, the performance

information, the human resources information and the financial affairs of the

department for the financial year ended 31 March 2017

Yours Faithfully

PROF T THEKISO

ACCOUNTING OFFICER

31 MAY 2017

25

5 STRATEGIC OVERVIEW

5.1 VISION

“A growing economy wherein enterprises thrive”

5.2 MISSION

To lead, coordinate, support, implement and champion inclusive economic growth for

the people of the North West Province through:

• Economic Planning and Development

Enterprise Development, and

Effective Regulatory Services

5.3VALUES

The following values, derived from the Constitution, underpin the activities of the

Department of Economy and Enterprise Development

Fairness, in that the Department will at all times act in a fair manner towards

executing its responsibilities.

Equity, as the Department is committed to treating all clients and employees

equitably in all respects.

Accessibility, in that the Department will remain accessible to its stakeholders and

role players in the course of executing its responsibilities.

Transparency, in that the Department undertakes to be transparent in the conduct

of its core business.

Accountability, in that the Department will at all times take full accountability for its

business actions and decisions.

Participation in that the Department will continue to participate fully in all areas of

its responsibility to satisfy the needs of our clients and stakeholders,

Good governance, to which the Department will always strive to adhere to at all

times.

26

6 LEGISLATIVE AND OTHER MANDATES

The Constitution of South Africa, 1996 The RDP White Paper; The National GEAR Strategy; The Consumer Affairs Practices (Harmful Business Practices) Act 4 of 1996; Consumer Protection Act 68 of 2008

National Credit Act 34 of 2005 Liquor Act, 1989; The North West Gambling Act of 2002; The Public Service Act, 1994; The Public Finance Management Act, 2000; The Public Service Regulations, 2001; The White Paper on transformation of the Public Service Delivery (Batho Pele) 1997; The Promotion of Access to Information Act 2 of 2000; The Cooperatives Act (2005) The National Spatial Development Perspectives (NSDP) Small Business Act, 1995 (currently under review)

Provincial SMME strategy North West Provincial Growth and Development Strategy (2004-2014), North West Spatial Development Initiatives Strategy, Broad Based Black Economic Empowerment Act, Rural Development Strategy including Integrated Sustainable Rural Development

Strategy,

Urban Renewal Strategy, Macro-Economic Reform Strategy, Integrated Manufacturing Strategy, Cooperatives Amendment Act of 2013 Co-Operatives Act, 2005 The Regional Industrial Development Strategy (RIDS) The National Industrial Development Framework

27

7 ORGANIZATIONAL STRUCTURE

[

28

8 ENTITIES REPORTING TO THE MEC

Name Of Entity North West Development Corporation

Legislative Mandate NWDC Limited Act No.6 of 1995

Financial relationship Schedule 3 D

Nature of Operations

To plan, finance, co-ordinate, promote and carry out the economic

development of the province and its people in the field industry,

commerce, finance, mining and other business, resulting in wealth and

job creation.

Name Of Entity North West Gambling Board

Legislative Mandate North West Gambling Act No.2 of 2001

Financial relationship Schedule 3 C

Nature of Operations It is to provide effective and efficient regulatory services that will

manage and maintain a socially responsible gambling industry, free from

illegal activity

29

PART B: PERFORMANCE INFORMATION

30

1AUDITOR GENERAL’S REPORT : PREDETERMINED OBJECTIVES

Refer to page 105 - 107 of the Report of the Auditor General, published as Part E: Financial

Information

2OVERVIEW OF DEPARTMENTAL PERFORMANCE

2.1Service Delivery Environment

The North West Province is a home to 3.79 million people, which is 6.8% of South Africa's

total population in 2016. Between 2006 and 2016 the population growth averaged 1.64%

per annum which is very similar than the growth rate of South Africa as a whole (1.54%).

With a GDP of R263 billion in 2016, the North West Province contributed 6.06% to the South

African GDP of R4.34 trillion in 2016. In 2016, the North West Province achieved an annual

growth rate of -1.33% which is a significant lower growth rate than that of South Africa as a

whole, where the 2016 GDP growth rate was 0.28%. The greatest contributor to the North

West Province economy was the Bojanala Platinum district municipality with a share of

52.28% or R137 billion. The lowest contribution was the Dr Ruth Segomotsi Mompati district

municipality with R17.3 billion. It is expected that North West Province's GDP will grow at an

average annual rate of 1.54% from 2016 to 2021. In 2021, North West's forecasted GDP will

be an estimated R188 billion (constant 2010 prices) or 5.6% of the total GDP of South

Africa.

In 2016, the mining sector was the largest contributor within North West Province

accounting for R76.7 billion or 32.9% of the total GVA in the province's economy. The sector

that contributed the second most to the GVA of the North West Province is the community

services sector at 21.1%, followed by the finance sector with 13.2%. The sector that

contributed the least to the economy was the construction sector with a contribution of

R6.08 billion or 2.61% of the total GVA.

The working age population in North-West in 2016 was 2.42 million, increasing at an

average annual rate of 1.32%. North-West Province's Economically Active Population was

1.25 million in 2016, which is 32.99% of its total population of 3.79 million, and roughly

5.90% of the total EAP of the South Africa. In 2016, North-West employed 834 000 people

which is 5.33% of the total employment in South Africa (15.7 million). Employment within

North-West increased annually at an average rate of 0.85% from 2006 to 2016. The number

of formally employed people in North-West Province counted 715 000 in 2016, which is

about 85.67% of total employment, while the number of people employed in the informal

sector counted 120 000 or 14.33% of the total employment. In 2016, there were a total

number of 343 000 people unemployed in North West Province, which represents 6.19% of

the total number of unemployed people in South Africa.

In a long feared move, South Africa has been downgraded to BB+ with a negative outlook.

This moves the country‟s rating into the so‐called „junk‟ or sub-investment grade category.

31

The consequences of this will be felt over many years in the form of higher borrowing costs

for all South African entities, a weaker exchange rate and lower investment potential and

therefore economic growth. South Africa is dependent on foreign capital to fund its twin

fiscal and current account deficits and this will now be more expensive. Borrowing costs for

government, SOEs, banks, companies and individuals will all now be higher than would

otherwise have been the case, the rand weaker and inflation more elevated.

The North West Province will therefore be challenged to provide an enabling environment to

compete with the rest of the country for investments and to make SMME‟s and Cooperatives

to thrive within a volatile environment for the foreseeable future.

2.2 Service Delivery Improvement Plan

Table 1.1 Main services provided and standard

Main Services

Beneficiaries Current/Actual Standard of

Service

Desired Standard of Service

Actual Achievement

To establish and sustain SMMES & Cooperatives in the province

SMMEs & Cooperatives

Quantity:

621 New (Coops & SMMEs) 452 Existing (Coops & SMMEs)

730 SMMEs & Co-ops (300 SMMEs, 300 Cooperatives and 130 Informal Traders)

A total of 917 business enterprises supported as follows: 270 Existing SMMES Supported 258 New SMMEs supported 149 Existing Cooperatives supported 70 New Cooperatives supported 170 Informal Traders Supported

Quality: Sustainable businesses

Sustainable businesses

419

32

Main Services


Service


Actual Achievement

Consultation

The department contracted the CSIR to conduct feasibility studies for project proposal with the involvement of beneficiaries The targets set in the Departmental Annual Performance Plans were exceed due to consultations and services delivered through Setsokotsane Program

Increased enterprise on site coaching sessions in VTSD areas

Increased Information dissemination workshops in VTSD areas

Provided advice and assistance to small business enterprises in areas of bookkeeping and cooperative compliance Conducted information dissemination sessions/workshops with enterprises through Setsokotsane Platforms

Access

Walk- ins increased during the period under review, but the Setsokotsane approach offers a better option of taking services to the people and information sharing sessions expanded to all areas were Setsokotsane Programs took place

Conducive environment for small business enterprises to thrive through facilitation of access to markets, access to finance, access to skill development interventions

Small business enterprises assisted to attend trade fairs, exhibitions and flea markets such as the Rustenburg Exhibition, Aardklop Exhibition in Potchefstroom, Decorex Exhibition in Gallagher, Mebalayarona Exhibition in Bakubung gate, VTSD Lekgotla Exhibitions The department has created an economic empowerment fund to assist enterprises with equipment and machinery

33

Main Services


Service


Actual Achievement

Courtesy

Acknowledgement letters are issued for every application received Feedback at this stage is only provided on the outcome of the application Complaints are referred to the department through the Setsokotsane Hotline and Operations room.

Acknowledge receipt of applications and give updates

Feedback in the form of acknowledgement of application for empowerment fund and the outcome thereof is communicated to applications.

Openness & Transparency

Cooperatives compliance workshops are held in various districts and

Information dissemination workshops in collaboration with other organs of state

Information

None The following have been loaded on the departmental website: Business registration application, Newsletters, speeches, promotion and showcasing of SMMEs and Cooperatives, Facebook feed

To update stakeholders through various communication tools:

Departmental website

Newsletters

Print media

Electronic media

Social media

Campaigns

Roadshows

Stakeholders updated on departmental programmes and achievements using the following relevant communication tools:

Departmental website

Newsletters (internal & external)

Print media (newspapers

34

Main Services


Service


Actual Achievement

for promoting SMMEs and Cooperatives

&flyers)

Electronic media(radio &TV)

Social media (Facebook & Twitter)

Campaigns

Roadshows

Redress

A feedback mechanism has been uploaded on the departmental website Red Tape Reduction awareness workshops conducted in municipalities.

To develop a user friendly and interactive calendar of events Red Tape reduction consultations to reduce barriers for SMMEs and Cooperatives to participate in the local economy

The interactive calendar of events is up and running Active Facebook page Eight barriers that hinders small business participation in the local economy were identified Reports and recommendations were compiled to assist, address or reduce the identified barriers.

Value for Money

Enterprise support services such as training was offered through accredited services providers Mentorship budget was utilized for accredited training Budget re-

Enterprise support services such as training was offered through accredited services providers Product development training to improve demand for goods and services

Business owners are now able to do basic bookkeeping and can assess performance of their businesses as well as take corrective action where necessary Product Development and Design Workshops were held with the SABS. There have been improvements in packaging and

35

Main Services


Service


Actual Achievement

directed to bakery support program

offered by SMMEs and cooperatives

labeling of products to enhance their marketability.

Table 1.2 Batho Pele arrangements with beneficiaries

Current /actual arrangements Desired Arrangements Actual Achievements

Access Walk- ins increased during the period under review, but the Setsokotsane approach offers a better option of taking services to the people and information sharing sessions expanded to all areas were Setsokotsane Programs took place

Conducive environment for small business enterprises to thrive through facilitation of access to markets, access to finance, access to skill development interventions

Small business enterprises assisted to attend trade fairs, exhibitions and flea markets such as the Rustenburg Exhibition, Aardklop Exhibition in Potchefstroom, Decorex Exhibition in Gallagher, Mebalayarona Exhibition in Bakubung gate, VTSD Lekgotla Exhibitions The department has created an economic empowerment fund to assist enterprises with equipment and machinery

Table 1.3 Service Delivery information tool

Current /actual information tools Desired information tools Actual achievements

Adverts on national newspapers, notice boards website, social media, information brochures newsletters and electronic media

Adverts on national newspapers, notice boards website, social media, information brochures newsletters and electronic media

Policies/Guidelines written

in relevant languages

The following have been loaded on

the departmental website:

Business registration application,

Newsletters, speeches, promotion

and showcasing of SMMEs and

Cooperatives, Facebook feed for

promoting SMMEs and

Cooperatives.

Wrote articles, statements and

advertorials.

Electronic and print media

36

interviews

Constant interaction with

stakeholders

Table 1.4 Complaints mechanism

Current / actual complaints mechanism Desired complaints mechanism Actual achievements

Redress A feedback mechanism has been uploaded on the departmental website Red Tape Reduction awareness workshops conducted in municipalities.

To develop a user friendly and interactive calendar of events Red Tape reduction consultations to reduce barriers for SMMEs and Cooperatives to participate in the local economy

The interactive calendar of events is up and running Active Facebook page Eight barriers that hinders small business participation in the local economy were identified Reports and recommendations were compiled to assist, address or reduce the identified barriers.

2.3 Organizational Environment

The restructuring efforts dictated the need for a new and reconfigured organisational

structure. The absence of the proposed and final organisational structure has affected the

filling of positions; however the Department is in the process of fast-tracking the finalisation

of the organisational structure. There have been challenges relating to filling of key

positions. Most of the vacancies are attributed to the delay in finalising the organisational

structure and the impact of the limited employees‟ compensation budget. This is the case on

the CFO, IEDS and Liquor Administration, which led to number of employees being

appointed in an acting capacity.

2.4 Key policy developments and legislative changes

The Department has the responsibility to respond to a number of policy imperatives, of

which the following are but some of the policy decisions and strategic issues to be

considered:

37

National Development Plan (NDP)

The Presidency, through the National Planning Commission has developed a long term

strategic plan of Government through the National Development Plan. The National

Development Plan (NDP) offers a long-term perspective for development. It defines a

desired destination and identifies the role different sectors of society need to play in

reaching that goal.

New Growth Path

The new growth path is aimed at stepping up the fight against poverty and unemployment

in South Africa. This is a proactive response to the global recession which took a heavy toll

on the economy of the North West Province. The New Growth Path extrapolates its thrust by

latching onto IPAP to accelerate industrial development in the country.

National Industrial Policy Framework (NIPF)

The National Industrial Policy Framework (NIPF) sets out government‟s broad approach to

industrialisation in the context of the Accelerated and Shared Growth Initiative for South

Africa (ASGI-SA) and its targets of halving unemployment and poverty through accelerated

growth of at least 6% by intensification of industrialisation towards a knowledge economy

beyond 2014.

Industrial Policy Action Plan (IPAP)

The Industrial Policy Action Plan (IPAP) sets out in detail key actions and timeframes for the

implementation of industrial policy. The publication of IPAP takes place within the

framework of continuous improvements and up scaling of concrete industrial development

interventions, as set out in the National Industrial Policy Framework (NIPF). Successive

iterations of IPAP seek to scale up key interventions over a rolling three-year period, with a

10-year outlook on desired economic outcomes.

Regional Industrial Development Strategy (RIDS)

The Regional Industrial Development Strategy (RIDS) is one of the strategic programmes of

the Industrial Policy Framework. RIDS fits within Strategic Programme 9: Spatial and

Industrial Infrastructure and aims to give effect to these goals and to help close the gap

between regions that, in particular, reflect the divide between the first and second

economies.

38

SMME Strategy

The SMME strategy aims to influence sustainability on enterprises, promoting economic

growth and development through entrepreneurship. The SMME strategic thrust is to create

and strengthen enterprise support services; implement mentoring; skill development,

incubation services for new and growing enterprises; establishing SMME support units at

local Municipalities; increasing visibility of the Department through outreach programmes

and information dissemination particularly to rural communities; interact with ordinary

members of the community and understand challenges faced by SMME‟s within the rural

communities; ensuring that the enterprises comply with the BBBEE and Preferential

Procurement policy requirements; establish SMME forums to coordinate activities of the

SMME development.

VTSD

The 5th Administration has introduced a policy of growing the economies of Villages,

Townships and Small Dorpies in an endeavour to respond to economic development

challenges facing the province, it is projected that the economy of the province will grow by

4% in 2015, 4.8% in 2016, and 5% in 2017 and 2018 respectively to achieve a growth

target of 6%. The focus of government will be on the development of villages, townships

and small dorpies. The strategy will be to target and diversify the economies of these areas

which will help to attain the economic growth target of 6% especially if driven by deliberate

programmes to foster growth and development in these areas. The intention is to induce

growth at the VDTD level by creating a favourable environment for attracting growth

minded entrepreneurs, creating capacity for innovation and attracting capital from other

regions.

39

3STRATEGIC OUTCOME ORIENTED GOALS

Programme Sub-Programme Strategic outcome oriented goals

1 Administration

Financial Management

Corporate

Services

1.1 Office of the MEC

1.2 Office of the HOD

1.3.1 Management Accounting

1.3.2 Financial Accounting

1.3.3 Supply Chain Management

1.3.4 Internal Control

1.4.1 Communication and IT

1.4.2 Legal Services

1.4.3 Human Resource Management

1.4.4 Strategic Planning, Monitoring And Evaluation

Create an effective, efficient and development oriented department in line with the Batho Pele principles.

2 Integrated Economic Development Services

2.1 Enterprise development

2.2 Regional and Local Economic Development

2.3 Economic Empowerment

The transformation of the economic landscape and the Implementation of enterprise support programs.

3 Economic Planning and Sector Development

3.1 Economic Research, Policy Development and Planning

3.2 Trade and Sector Development

Position North West as the preferred investment destination and increase trade activities in the Province.

4 Business Regulations and Governance

4.1 Consumer Protection

4.2 Liquor Regulations

4.3 Regulation Services

Regulate business activities in the Province to create conducive legal, business and socio economic environment for business prosperity.

40

4 PERFORMANCE INFORMATION BY PROGRAMME

4.1 PROGRAMME 1: ADMINISTRATION

Purpose: The programme provides political and administrative leadership and

support in accordance with relevant legislations, regulations and policies and ensures

appropriate support service to all other programmes.

Sub –Programmes:

1.1 MEC‟s Office

1.2 HOD‟s Office

1.3 Financial Management

1.4 Corporate Services

Strategic Objectives:

Programme 1: Administration

Strategic

Objectives

Actual

Achievement

2015/2016

Planned

Target

2016/2017

Actual

Achievement

2016/2017

Deviation from

planned target

to Actual

Achievement

for 2016/2017

Comments on deviations

To give policy and strategic

direction to the

department to achieve its

objectives of growing an

inclusive economy and

creating jobs

29 22 30 +8 See deviations in table

below

Give strategic and

administrative leadership

to the Department in

pursuit of good

governance

98% 100% 92% -8% See deviations in table

below

To plan and budget

financial activities in

compliance with all

relevant legislation and

policies, regulations,

framework and guidelines

15 15 15 0 No Deviation

Effective management of

expenditure, revenue,

assets and liabilities, and

financial reporting


41


Strategic

Objectives

Actual

Achievement

2015/2016

Planned

Target

2016/2017

Actual

Achievement

2016/2017

Deviation from

planned target

to Actual

Achievement

for 2016/2017


To implement supply chain

functions of demand,

acquisition, logistics,

assets and disposal

management


To identify and mitigate

control risks which may

hamper Department to

achieve their objectives


To maintain effective

communication relations

with internal and external

stakeholders of the

department


To ensure the provision of

ICT services by

implementing

Departmental ICT strategy


To provide comprehensive

and professional legal

support services to the

Department


To provide and promote

strategic human resources

management


To provide strategic management and to monitor and evaluate the impact of departmental projects, programmes and initiatives


42

Sub Programme 1.1 MEC’s Office

Significant Achievements

Performance Indicators

Sub-Programme: 1.1: MEC's Office

Performance Indicator

Actual Achievement 2013/14


Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017

Deviation from

planned target to

Actual Achievement

for 2016/2017

Comments on

deviations

Number of reports on LED meetings held with MMCs

4 3 10 4 5 +1

Setsokotsane activities

compelled the

Department to have

frequent interaction

with stakeholders

Number of reports on sector/industry organisations meetings

8 6 6 6 11 +5

Setsokotsane activities

compelled the

Department to have

frequent interaction

with stakeholders

Number of reports on oversight engagements with the department/agencies

8 9 15 12 14 +2

There was the need for the MEC to have more oversight

engagement with the

Department and agency on matters

that relate to the

improvement of service delivery.

Strategy to overcome areas of underperformance

None

43

Sub Programme 1.2 HOD’s Office



Sub-Programme: 1.2: HOD’s Office




Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017

Deviation from

planned target to

Actual Achievement

for 2016/2017


Percentage achievement of overall departmental targets

54% 82% 98% 100% 93% -7% Deviations

listed under programmes


None

Sub Programme 1.3.1: Management Accounting


The department ensured that no irregular expenditure was incurred in the year

under review

No fruitless and Wasteful and unauthorised expenditure were incurred during the

year under review.


Sub-Programme: 1.3.1: Management Accounting




Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017

Deviation from

planned target to

Actual Achievement

for 2016/2017


Number of budget preparation and implementation reports produced

- - 15 16 16 0 No Deviation

44


None

Sub Programme 1.3.2: Financial Accounting


Audit findings relating to 2015-16 financial year were all cleared and recommendations

thereof implemented during the year.


Sub Programme 1.3.2: Financial Accounting




Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017

Deviation from

planned target to

Actual Achievement

for 2016/2017


Number of compliance financial statements submitted to Auditor General & Provincial Treasury


Number of tax compliance reports submitted to SARS


Number of BAS management reports submitted



None

Sub Programme 1.3.3: Supply Chain Management


No irregular expenditure was incurred during the year.

Assets register was updated with all the acquisitions and disposals.

All suppliers of goods and services were paid with 30 days within the receipt of

invoices as prescribed.

45


Sub Programme 1.3.3: Supply Chain Management




Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017

Deviation from

planned target to

Actual Achievement

for 2016/2017


Number of approved compliant procurement plan(s)


Number of SCM compliance monitoring reports


Number of Assets Management Reports


Percentage of invoices paid within 30 days

- - - 100% 100% 0 No Deviation


None

Sub Programme 1.3.4: Internal Control


Audit action plans were developed which resulted in successfully implementing

Auditors General‟s recommendations.

46


Sub Programme 1.3.4: Internal Control




Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017

Deviation from

planned target to

Actual Achievement

for 2016/2017


Number of compliance reports on Internal Control Submitted

- 4 25 4 4 0 No Deviation

Number of implementation reports on audit action plans.

- 12 12 0 No Deviation

Number of risk management reports submitted

4 4 - 4 4 0 No Deviation


None

Sub Programme 1.4: Corporate Services

Sub Programme 1.4.1 Communications & Information Technology


Enhanced communication effectiveness through mediums such as suggestion boxes,

Facebook page, flyers and bulk SMS‟s services.

Successfully facilitated the support function role in event management, media

coverage, branding, promotion and corporate identity for, among others, the

Provincial Stokvelex Bokone Bophirima, VTSD Lekgotla, Liquor and Consumer

celebrations, Facilitated establishment of Mokgalwana Bakery Cooperative, Launch of

Consumer Court, Disability Symposium to mention just a few.

Coordinated Setsokotsane, MRRRP and Bua le Puso campaigns

Assisted with phase 01 on the development of Liquor Administration Information

system,

Assisted with the formulation of Chamber of Commerce on VTSD within Dr R.M. District

Kagisano Molopo local, Naledi, Greater Taung Municipalities and Bojanala District

47

Audited business at VTSD areas in the following District Municipalities: Bojanala, Dr

Segomotsi Mompati, Ngaka Modiri Molema.


Sub Programme 1.4.1 Communications & Information Technology




Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017

Deviation from

planned target to

Actual Achievement

for 2016/2017


Number of progress reports on the implementation of the Departmental Communication Strategy

- - - 4 4 0 No Deviation

Number of progress reports on the implementation of the Departmental Information Communication Technology (ICT) Strategy



None

Sub Programme 1.4.2 Legal Services


The legal services unit has provided 20 Litigations (inclusive of labour appeals and Review

Tribunal matters), 7 legal opinions and advice, 24 Service Level Agreements and MOU/MOA

and 2 Legislation.

48


Sub-Programme: 1.4.2: Legal Services





Planned Target

2016/2017


Deviation from

planned target to

Actual Achievemen

t for 2016/2017

Comments on

deviations

Number of reports on reviewed legislation administered by the Department.

- - 4 1 1 0 No

Deviation

Number of reports on written legal opinions and legal advice.

- - 4 2 3 +1

Written legal

opinions and legal

advice were

rendered during the

1st

quarter.

Number of reports on Service Level agreements/Contracts drafted

- - 4 4 4 0 No

Deviation

Number of reports on Litigation Management.

- - 4 2 3 +1

Litigation was

managed during the

1st

quarter.


None

49

Sub Programme 1.4.3: Human Resource Management



Sub-Programme: 1.4.3: Human Resource Management




Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017

Deviation from

planned target to

Actual Achievement

for 2016/2017


Percentage of Performance Agreements completed by employees by prescribed date

- - 2 100% 100% 0 No Deviation

Number of Reports on the implementation of the Workplace Skills Plan

1 4 4 4 4 0 No Deviation

Number of Report on the implementation of the departmental Employee Health and Wellness programmes



None

Sub Programme 1.4.4: Strategic Planning, Monitoring and Evaluation


Four Quarterly Performance Reports (QPR) were compiled and submitted to the

Office of the Premier.

Finalized and corrected 2016/2017 Performance Information with the Auditor

General.

Finalized the 2017/ 18 APP for submission to Legislature

50

Finalised 2015/16 Annual Report. The department excelled in terms of performance

and received a clean audit opinion for that period.

The unit facilitated 3 quarterly performance review sessions. These sessions were

instrumental in flagging shortcomings in achieving predetermined targets as well as

creating a recovery process which ensured the achievement of 93%of its targets.

M&E successfully compiled and consolidated 4 quarterly departmental reports and

the analysis thereof.

M&E successfully analysed and gave feedback on the 2017/18 Corporate Plan /

Annual Performance Plan of the departmental agency The North West Gambling

Board


Sub-Programme: 1.4.4: Strategic Planning, Monitoring and Evaluation




Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017

Deviation from

planned target to

Actual Achievement

for 2016/2017


Annual Performance Plan compiled


Number of monitoring reports produced


Compiled Annual Report


Review on the departmental SDIP



None


51

The major contributory factor for the under-spending is the delay in the recruitment process

which will be finalised during the beginning of the 2017-18 financial year.

Sub ProgrammeFinal

Appropriation

Actual

Expenditure

(Over)/

Under

Expenditu

re

Final

Appropriatio

n

Actual

Expenditure

(Over)/

Under

Expenditu

re

R 000 R 000 R 000 R 000 R 000 R 000

Office Of The Mec 78 77 1 480 300 180

Office Of The Hod 4 160 3 783 377 7 414 7 077 337

Financial Management 23 212 22 074 1 138 20 899 20 759 140

Corporate Services 67 715 64 733 2 982 55 059 51 807 3 253

Totals 95 165 90 667 4 498 83 852 79 943 3 910

2016/17 2015/16


52

4.2 PROGRAMME 2: INTEGRATED ECONOMIC DEVELOPMENT SERVICES

Purpose:

To create an enabling environment for the development and growth of sustainable SMMEs

and Cooperatives to ensure contribution on economic growth and job creation in partnership

with Stakeholders.

Sub Programmes

Sub Programme 2.1 : Enterprise Development

Sub Programme 2.2 : Regional and Local Economic Development

Sub Programme 2.3 : Economic Empowerment

Strategic Objectives

Programme 2: Integrated Economic Development Services


Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017

Deviation from planned target

to Actual Achievement for 2016/2017


To facilitate radical economic transformation through establishment and maintenance of effective small business support to ensure contribution on economic growth and job creation.

906 906 905 -1 See Deviation listed below

To support and promote economic growth and development of regional and local economies in partnership with key stakeholders by aligning LED initiatives with government programmes.


To promote transformation of economic imbalances by increasing the establishment, support and development of new and existing women, youth and people with disabilities’ SMMEs and cooperatives to ensure increased participation in the mainstream economy.


53

Sub Programme 2.1: Enterprise Development


During the year under review 56 learners from Madibeng Local Municipality

successfully completed a plumbing learnership program which is a collaborative

effort between the Department and the Construction Sector Training Authority

(CETA)

The department has commenced with the roll out of a flagship SMME support

Programme known as North West Growth Accelerator Programme. The programme

is primarily designed to identify and support SMMEs through a comprehensive range

of business growth oriented programmes, activities and partnerships. 64 businesses

across the Province have been listed for the first 12 months of the three year

program.

The Sub-Programme hosted an exhibition for the promotion and information sharing

in relation to one of the oldest strategies applied in radical socio economic

development of villages, township and small dorpies, known as stokvel. The

exhibition known as Stokvel Bokone Bophirima 2017 which was held from 10th to the

11th March 2017 attracted a total of 30 exhibitors, the department included. The

objectives of the event were inculcating the culture of cooperation towards a

common goals of bulk buying, investment promotion and saving among

communities.

The department entered into a Service Level Agreement to train SMMEs and

cooperatives on how to increase their productivity and grow their businesses.

The Department in partnership South African Bureau of Standards (SABS)

implemented a product development programme aimed at enhancing the quality of

products of the small businesses. 15 enterprises from different sectors benefited

from the programme which is designed to capacitate small business in areas of

Product Design, Labelling, Pricing and Market access.


Sub-Programme: 2.1 Enterprise development




Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017

Deviation from planned

target to Actual

Achievement for 2016/2017


Number of existing

- - 268 150 182 +32 Training activities

54

Sub-Programme: 2.1 Enterprise development




Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017


target to Actual



SMMEs supported in the VTSD

increased as a result of

unplanned collaboration with SEDA on non-financial

support.

Number of new SMMEs developed in the VTSD - - 322 150 281 +131

More SMMEs were registered

at CIPC as a result of

Setsokotsane and VTSD

engagements

Number of existing cooperatives supported in the VTSD - - 316 150 176 +26

Training activities



support.

Number of new cooperatives developed in the VTSD - - 295 150 110 -40

Deviation was due to

registration certificates

being delivered directly to the applicant and

not through the department

Number of informal businesses supported in the VTSD - - - 130 137 +7

Training activities



support.

Number of Integrated Enterprise Development Strategies developed

- - - 1 0 -1

The strategy could not be

developed due to priority

Setsokotsane commitments.

55


Strategy to be developed in the second quarter of the new financial year.

Sub Programme 2.2: Regional & Local Economic Development


As part of Saamwerk Saamtrek and enhanced implementation of Local Economic

Development initiatives, the Department successfully hosted 4 Technical Muni MECs which

created opportunity for integration and implementation of shared services model for Local

Economic Development.


Sub-Programme: 2.2 Regional & Local Economic Development




Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017


target to Actual


Comments on

deviations

Number of new LED projects supported at local and regional levels 5 5 38 19 17 -2

Two projects were

transferred to NWDC for implementat

ion and were not

completed during the year under

review

Number of Red Tape barriers identified. - - - 8 8 0 No Deviation

Number of Red Tape barriers addressed - - - 8 8 0 No Deviation

56

Number of capacity building interventions to municipalities

- - - 10 12 +2

Additional capacity building

intervention modules

/training to LED officials were done due to the

collaboration forged with the

Commonwealth Local

Government Forum (CLGF)

Number of Technical Munimec Committee meetings held



None

Sub Programme 2.3: Economic Empowerment


Mokgalwana Youth Bakery in ward 29 Mokgalwaneng Village, was handed over to

the community.

The Department successfully hosted a symposium on reducing economic vulnerability

and releasing human capital of People with Disabilities

57


Sub-Programme: 2.3 Economic Empowerment




Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017

Deviation from

planned target to

Actual Achievement

for 2016/2017


Number of enterprises owned by targeted groups in VTSD wards exposed to specific opportunities

- - 334 150 448 +298

Establishment of VTSD

Chambers of Commerce increased

outreached targets

Number of enterprises owned by targeted groups in VTSD wards benefited from specific interventions

- - 451 150 451 +301

Partnerships with SEDA and

NYDA increased training

opportunities

Number of funding referrals to public institutions - - - 20 81 +61

Partnerships with

stakeholders led to more referrals for

financial support

Strategies to overcome areas of underperformance

None


The under-spending is on Compensation of Employees due to the delay in the recruitment

process which was finalised in the beginning of 2017/18 financial year.

Sub ProgrammeFinal

Appropriation

Actual

Expenditure

(Over)/

Under

Expenditu

re

Final

Appropriatio

n

Actual

Expenditure

(Over)/

Under

Expenditu

re

R 000 R 000 R 000 R 000 R 000 R 000

Entreprise Development 46 099 45 391 708 48 175 47 427 748

Regional And Local Economic Development 2 398 2 209 189 1 937 1 722 215

Economic Empowerment 4 564 4 191 373 4 429 3 882 548

Totals 53 060 51 791 1 269 54 541 53 031 1 511

Programme 2: Integrated Economic Development Services

2016/17 2015/16

58

4.3 PROGRAMME 3: ECONOMIC PLANNING AND SECTOR DEVELOPMENT

Purpose: To facilitate economic research and planning processes that will stimulate

integrated economic growth for North West Province through trade and industry

development as well as through investment promotion.

Sub Programmes

3.1Economic Research, Policy Development and Planning

3.2 Trade and Sector Development


Sub Programme 3.1Economic Research, Policy Development and Planning


FEED hosted VTSD Economic Lekgotla at Mmabatho Convention Centre from the 30th

November to the 2nd December 2016. The Summit brought together an audience of 500

delegates drawn from a variety of public and private sector key stakeholders. The main

theme of the discussion focused on the strengthening stakeholder cooperation within

Bokone Bophirima with the aim of bringing sustainable development within our targeted

VTSDs.

The VTSD Economic lekgotla was part of a process that started in early 2016. There were 2

phases prior the VTSD Lekgotla, firstly setting up of the development plans, going into the

VTSD areas to see what development, what resources and opportunities are present in the

PROGRAMME 3: ECONOMIC PLANNING AND SECTOR DEVELOPMENT

Strategic

Objectives

Actual

Achievement

2015/2016

Planned

Target

2016/2017

Actual

Achievement

2016/2017

Deviation from

planned target

to Actual

Achievement

for 2016/2017


To facilitate and undertake research that will inform the development and review of economic development plans, policies and strategies in alignment with national and provincial priorities.


To facilitate the growth and development of economic opportunities within the agro-processing, mining beneficiation , manufacturing and the green economy sectors


59

VTSD areas. The second phase was the establishment of VTSD chambers of commerce in all

VTSD area bringing all informal & formal business in the area under a chamber of commerce

at Local and District level. The VTSD Chambers of Commerce are seen as a platform that

our SMMEs will be able to use to grow their businesses and in so doing, assist government

in its fight against the triple challenges of poverty, unemployment and inequality.


Sub Programme 3.1 Economic Research, Policy Development and Planning




Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017

Deviation from

planned target to

Actual Achievement

for 2016/2017


Number of economic VTSD strategies developed


Number of economic ACT strategies developed


Number of reports on initiatives supporting Setsokotsane within the targeted VTSD


Number of research reports produced


Number of ACT sectors performance reports produced


Number of industry studies on economic opportunities


Number of strategies reviewed



None

60

Sub Programme 3.2 Trade and Sector Development


An opportunity had been identified to exploit the mineral resources that exist on the farm

894 HN, Taung. The department had been assisting Batlhaping Ba Ga Phuduhutswana in

Taung to apply for mining prospecting rights. The aim of the project is to benefit the

Community and to stimulate economic growth and development. The mineral resources

opportunities that exist in the area include lime, marble, slate, diamond, coal and oil. The

department of Economy and Enterprise Development will be assisting with the community

with all necessary application processes as required by the DMR for mining to take place.


Sub-Programme: 3.2: Trade and Investment Promotion




Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017

Deviation from

planned target to

Actual Achievement

for 2016/2017


Number of business plan developed


Number of projects implementation reports produced



None




Sub ProgrammeFinal

Appropriation

Actual

Expenditure

(Over)/

Under

Expenditu

re

Final

Appropriatio

n

Actual

Expenditure

(Over)/

Under

Expenditu

re

R 000 R 000 R 000 R 000 R 000 R 000

Economic Research, Policy Development And Planning 5 453 4 450 1 003 6 092 5 504 588

Trade And Sector Development 49 352 49 180 172 81 657 79 920 1 737

Programme 3: Economic Planning And Sector Development

2016/17 2015/16

61

4.4 PROGRAMME 4: BUSINESS REGULATIONS AND

GOVERNANCE

Purpose:

To create measures that are geared to promote and protect the rights and interests of

consumers, effective and efficient regulation of liquor industry and to facilitate the creation

of an equitable, socially responsible business environment that allows for predictability and

an inclusive economy.

Sub Programmes

4.1 Consumer Protection

4.2 Liquor Regulation

4.3 Regulation Services


Programme 4 : BUSINESS REGULATION AND GOVERNANCE

Strategic

Objectives

Actual

Achievement

2015/2016

Planned

Target

2016/2017

Actual

Achievement

2016/2017

Deviation from

planned target to

Actual Achievement

for 2016/2017

Comments on

deviations

The promotion and protection of consumer rights through awareness and effective complaints resolution mechanisms

1 1 0 -1

See deviations in

table below

Effective and efficient regulation of the liquor industry through compliance monitoring, enforcement and awareness creation in the North West Province.


The regulation, identification and address of barriers in the broader business environment


62

Sub Programme 4.1: Consumer Protection


The Consumer Court was launched and its first session was held on the 24th March 2017.

A total of 293 out of 342 consumer complaints were resolved successfully and R 837 176

was retrieved on behalf of consumers in our Province. The Unit was able to conduct

investigations into market practices in remote rural areas as part of the Setsokotsane

Programme, where unscrupulous businesses were found to be exploiting consumers. Non-

compliant businesses were instructed to comply and some were reported to relevant

authorities.

Education awareness programmes were conducted in VTSD areas and 20 447 consumers

were reached.

The department celebrated World Consumer Rights Day in Madibeng under the theme

“Consumer in the digital era”. Build up programmes were conducted in the form of road

shows and Blitz inspections where goods worth R250 000 were confiscated and destroyed

around Madibeng Municipality where the Main Event was held.


Sub-Programme: 4.1: Consumer protection




Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017

Deviation from

planned target to

Actual Achievement

for 2016/2017


Number of consumer education awareness conducted

484 579 661 573 750 +177

Partnerships with NCR,

NERSA and participation

in Setsokotsane programme

increased the consumer education awareness that were planned

Percentage of consumer complaints resolved

- - - 70% 85% +15%

Extra personnel

were utilized in attending to and resolving

63

cases

Number of investigations into market practices finalised

- - 20 10 11 +1

This was as a results of a

follow up on a Market Practice

investigation

Percentage of consumer court cases resolved by the court

- - - 80% 0% -80%

Cases that were referred to the court

were postponed to May 2017 in

the new financial year


Regulations were published in March 2017 to allow the Consumer Court to operate.

Sub Programme 4.2: Liquor Regulations


The Provincial Liquor Act is now complete and signed by The Honourable Premier.

A total number of 5 168 liquor outlets were inspected during the normal compliance

enforcements. 3 448 outlets were compliant with the Liquor Act No. 27 of 1989, as

amended. 1 155 outlets were found non-compliant, 533 outlets were not operating at the

time of inspection, 32 outlets were verified at the request of the Liquor Board.

The department together with the SAPS and other relevant stakeholders have conducted

joint operations starting from 18:00 to 02:00am in the morning to check compliance on

closing time, age group, and other compliance as required by the Liquor Act. In all 609

outlets inspected, 383 outlets were found to be compliant with liquor legislation, 212 were

non- compliant, and 14 outlets not operating at the time of inspection.

The Unit was able to circumvent scams that tried to defraud liquor traders by requesting

them to make a deposit for a liquor licence admin fee into an FNB account and later into an

ABSA bank account.

The Liquor Unit conducted 108 liquor outreach programmes, and through these interactions

a total of 1 012 community members were reached.

64

A social responsibility programme was also conducted where issues of alcohol abuse and

health ills associated with it were addressed and families who are negatively affected by

alcohol abuse were assisted.

The Unit together with our stakeholders i.e. Department of Social Development and DTI,

conducted workshops in all four Districts during Liquor Month of February. At each workshop

250 people attended as a build up to the Provincial Liquor Event which was later held in Dr

Ruth Segomotsi Mompati where 800 participants Attended. During the workshops and at the

main Event presentations on the new Liquor Act, Manufacturing and Distribution licenses

and the alcohol abuse made.


Sub-Programme: 4.2 Liquor regulation




Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017


target to Actual



Number of reports on liquor licensing with emphasis on VTSD.


Number of awareness programmes conducted with emphasis on VTSD.

- - 104 96 122 +26

Deviations due to

community requests for awareness

and complaints

Number of inspections conducted with emphasis on VTSD.

- - 4887 4800 4929 +129

Deviations due to

community requests and complaints

Number of social responsibility programmes conducted with emphasis on VTSD.

- - 1 4 4 0

No Deviation

65

Strategies to overcome areas of underperformance

None

Sub Programme 4.3: Regulation Services


None


Sub-Programme: 4.3: Regulation Services




Actual Achievement

2015/2016

Planned Target

2016/2017

Actual Achievement

2016/2017

Deviation from

planned target to

Actual Achievement

for 2016/2017


Number of reports on retail licensing

-

0

0

12

12

0

No Deviation


None




Sub ProgrammeFinal

Appropriation

Actual

Expenditure

(Over)/

Under

Expenditu

re

Final

Appropriatio

n

Actual

Expenditure

(Over)/

Under

Expenditu

re

R 000 R 000 R 000 R 000 R 000 R 000

Regulation Services 2 186 2 057 129 1 782 1 612 171

Consumer Protection 12 558 12 304 254 9 503 9 237 267

Liquor Regulation 11 387 10 798 589 8 008 7 732 276

Gambling And Betting 77 154 77 154 - 64 661 64 661 -

Totals 103 285 102 313 972 83 954 83 241 713

Programme 4: Business Regulation And Governance

2016/17 2015/16

66

Transfer payments to public entities

Name of Public entity

Services rendered by public entity

Amount transferred to public entity

Amount spent by public entity

Achievements of the public entity

North West Development Corporation

Implementation of

Projects

R 48 598 000

R 48 598 000

Projects

Implemented

North West Gambling Board

Regulation of the

gambling and gaming industry

R 77 154 000

R 77 154 000

Gambling and

gaming industry regulated

Conditional Grants

None

Donor Funds

None

Capital Investment

None

67

PART C: GOVERNANCE

68

5.1 Introduction

The Department operated within the prescripts of PFMA Act 1 of 1999 and Treasury

Regulations. Performance agreements for all Senior Management in line with the

Annual Performance Plan were signed. All Supply Chain Management BID

Committees were established and all Senior Managers declared their financial

disclosure of interest.

5.2 Risk Management

5.2.1. Risk Assessment

Strategic, operational and Fraud Risk registers were reviewed and monitoring

performed by Risk Management Committee and Departmental Management

Committee on quarterly basis. Performance Agreements for senior management

constitute risk management as key performance area. Awareness sessions were held

for all staff members. Training was coordinated to nominated officials as risk

champions for each programme to assist risk owners with the implementation of risk

management in the department.

5.2.2 Risk Management Committee

Risk Management Committee with an independent chairperson was appointed during

the year and two out of four planned meetings were successfully held. In

discharging its governance responsibilities relating to risk management, the risk

management committee ensured that audit findings are cleared and strategic risk‟

treatment plans are implemented.

The department developed the risk maturity plan to ensure that the department‟s

risk management processes bears good benefits.

5.3 Fraud and Corruption

No incident of fraud or corruption was reported during the year. Awareness sessions

on PAJA (Promotion of Administrative Justice Act of 2000), PAIA (Promotion Of

Access to Information Act 2 of 2000) , Information Security Policy and whistle

blowing policy. Fraud and ethics committee held two meetings out of the four

planned meetings.

5.4 Minimising conflict of interest

Supply Chain Management practitioners signed declarations to ensure that no conflict

arises between their personal business interest and the interests of the state and

SMS members have also signed their mandatory declarations.

All other officials have also been requested to declare their business holdings,

especially where these businesses have dealings with government.

69

5.5 Code of conduct

All staff members (new & existing) appointed officials were work-shopped on the

Public Service Code of Conduct and electronic copies distributed to all staff members.

New appointees attended Compulsory Induction Programme as prescribed by

Department Of Public Service Administration.

5.6 Health safety and environmental issues

Numerous events are being held by the Department to create awareness and encourage employees to be critical of their health and well-being. These events fall within the auspices of SHERQ.

The challenges the Department faces on the above matters are attributed to none compliant of the leased buildings, where the landlords are not coming to the party with regard to access and other compliant issues.

5.7 SCOPA resolutions

There were no SCOPA resolutions during the 2016/17 financial year

5.8 Prior modifications to audit reports

No modifications to previous audit reports have been made.

5.9 Internal control

The department developed compliance checklist to curb issue of non-compliance and SCM

checklist was developed and implemented during the year under review. Standard Operating

Procedures creditors‟ payment and certification of payrolls developed to curb issue of non

compliance to 30 days payment and monitoring of payrolls.

The department has established registry and human resource records to curb the non-

compliance to records management.

70

5.10 Report of the Provincial Audit Committee

75

PART D: HUMAN RESOURCE MANAGEMENT

76

6.1INTRODUCTION

The statistics and information published in the Human Resources Management part

of the annual report are required in terms of Chapter 1, Part III J.3 and J.4 of the

Public Service Regulations, 2002 and have been prescribed by the Minister for the

Public Service and Administration for all departments within the Public Service.

Overview of the Human Resources matters at the Department

The programme provides for the effective human resources management

interventions through the alignment of Departmental Structure to business strategy.

It renders an effective and efficient professional human resource and administrative

support to the department. It coordinates the training and development of staff. It,

further, ensures employee Health and Wellness and Safety as well as to ensure

sound labour relations in the workplace.

6.2 HUMAN RESOURCE OVERSIGHT STATISTICS

6.2.1 Personnel related expenditure

The following tables summarise the final audited personnel related expenditure by

programme and salary bands. In particular, it provides an indication of the following

Amount spent on personnel

Amount spent on salaries, overtime, homeowner‟s allowances and medical aid.

Table 6.2.1 – Personnel expenditure by programme, 2016/17

Table 6.2.1 Personnel costs by programme, 2016/17

Programme Number of

Employees as at 31 March 2017

Personnel Expenditure (excl Good & Services)

Training expenditure

Personnel expenditure

as a % of Total

Expenditure

Average Personnel Cost per Employee

(R)

Programme 1 Administration 113 R 44 671 946,50 53 R 395 327,00

Programme 2 Integrated Economic Development

26 R 12 652 251,13 15 R 486 625,00

Programme 3 Trade & Industry Development

2 R 726 445,49 1 R 363 223,00

Programme 4 Business Regulation 55 R 21 111 619,53 25 R 383 848,00

Programme 5 Planning &Monitoring 9 R 5 069 745,90 6 R 563 305,00

Grand Total 205 R 84 232 008,55 100 R 410 888,00

Please note that the amount of Personnel expenditure excludes training expenditure and personnel expenditure made outside PERSAL.

Table 6.2.2 – Personnel costs by salary bands, 2016/17

Table 6.2.2 Personnel costs by salary bands, 2016/17

Salary bands

Personnel Expenditure

(excl Good & Services)

% of Total Personnel

Cost

No. of Employees as at

31 March 2016

Average Personnel Cost

per Employee (R)

Lower skilled (Levels 1-2) R2 001 443,87 2 13 R 153 957,00

Skilled (Levels 3-5) R13 607 859,32 16 66 R 206 180,00

77

Highly skilled production (Levels 6-8) R21 052 145,43 25 60 R 350 869,00

Highly skilled supervision (Levels 9-12) R34 572 123,52 41 51 R 677 885,00

Senior and Top Management (Level 13-16) R10 340 258,19 12 10 R 1 034 026,00

Contract (Levels 1-2) R22 500,00 0 R 0,00

Contract (Levels 3-5) R195 245,51 0 1 R 195 246,00

Contract (Levels 6-8) R895 155,23 1 3 R 298 385,00

Contract (Levels 9-12) R106 804,25 0 R 0,00

Contract (Levels 13-16) R1 438 473,23 2 1 R 1 438 473,00

Periodical Remuneration R0.00 0 0 R 0.00

Abnormal Appointment R0.00 0 0 R 0.00

Grand Total R 84 232 008,55 100 205 R 410 888,00

Table6.2.3 – Salaries, Overtime, Home Owners Allowance and Medical Aid by programme, 2016/17

Table 6.2.3 Salaries, Overtime, Home Owners Allowance and Medical Assistance by programme, 2016/17

Programme

Salaries Overtime Home Owners Allowance Medical Assistance

Personnel

Expenditure

(Excl Goods

and Services)

Amount

Salaries

as % of

personn

el cost

Amount

Overtime

as % of

personnel

cost

Amount

HOA as

% of

personn

el cost

Amount

Medical

ass. As

% of

personn

el cost

Administration R 30 172 505,36 68 R 115 637,82 0 R 1 505 385,35

3 R 2 175 896,50 5 R 44 671

946,50

Inter Econ Dev R 8 781 489,16 69 0 0 R 280 892,00

2 R 547 507,25 4 R 12 652

251,13

Trade & Industry Dev R 558 182,19 77 0 0 R 5 100,00 1 R 19 800,00 3 R 726 445,49

Business Regulation R 14 020 298,47 66 R 167 358,30 1 R 755 091,00

4 R 1 202 183,75 6 R 21 111

619,53

Planning &

Monitoring R 3 418 327,32 67 0 0

R 105 102,00 2 R 62 327,00 1

R 5 069

745,90

Grand Total R 56 950 802,50 68 R 282 996,12 0 R 2 651 570,35 3 R 4 007 714,50 5 R 84 232

008,55

Table 6.2.4 – Salaries, Overtime, Home Owners Allowance and Medical Assistance by salary bands, 2016/17

Table 6.2.4 Salaries, Overtime, Home Owners Allowance and Medical Assistance by salary bands, 2016/17

Salary bands

Salaries Overtime Home Owners Allowance

Medical Assistance Personnel Expenditure (excl Good & Services)

Salaries Via Persal

Salaries As % Of Personnel Cost

Overtime Overtime As % Of Personnel

House Owners Allowance

HO

A As

%

Of

Pers

onn

el

Medical Funds Medical Ass. % of Personnel Cost

78

Cost Cost

Lower skilled (Levels 1-2) R 1 185 461,52 59 0 0 R 187 200,00 9 R 283 579,25 14 R 2 001 443,87

Skilled (Levels 3-5) R 8 978 845,18 66 R 54 964,37 0 R 807 900,00 6 R 1 231 243,00 9 R 13 607 859,32

Highly skilled production

(Levels 6-8) R 14 604 508,75 69 R 150 186,06 1 R 770 400,00 4 R 1 293 605,00 6 R 21 052 145,43

Highly skilled supervision

(Levels 9-12) R 23 906 419,13 69 R 49 648,02 0 R 662 555,35 2 R 1 078 265,75 3 R 34 572 123,52

Senior and Top

Management (Level 13-

16)

R 6 483 881,52 63 0 0 R 209 115,00 2 R 121 021,50 1 R 10 340 258,19

Contract (Levels 1-2) R 22 500,00 100 0 0 0 0 0 0 R 22 500,00


Contract (Levels 6-8) R 633 582,00 71 R 28 197,67 3 R 14 400,00 2 0 0 R 895 155,23


Contract (Levels 13-16) R 915 197,40 64 0 0 0 0 0 0 R 1 438 473,23

Periodical Remuneration 0 0 0 0 0 0 0 0 R 0,00

Abnormal Appointment 0 0 0 0 0 0 0 0 R 0,00

Grand Total R 56 950 802,50 68 R 282 996,12 0 R 2 651 570,35 3 R 4 007 714,50 5 R 84 232 008,55

6.3 EMPLOYMENT AND VACANCIES Table 6.3.1 – Employment and vacancies by programme, 31 March 2017

Table 6.3.1 Employment and Vacancies by Programme, 31 March 2017

Programme No. of posts No. of posts filled % Vacancy Rate No. of employees

additional to the establishment

11000010 DEDECT: PROG 1 ADMINISTRATION 121 113 7 0

11000020 DEDECT: PROG 2 INTERGRATED

ECONOMIC DEVELOPMENT 32 24 25 0

11000030 DEDECT: PROG 3 TRADE AND INDUSTRY

DEVELOPMENT 1 1 0 0

11000040 DEDECT: PROG 4 BUSINESS REGULATION 63 55 13 0

11000050 DEDECT: PROG 5 PLANNING AND

MONITORING 10 9 10 0

Grand Total 227 202 11 0

Table 6.3.2 – Employment and Vacancies by Salary Bands, 31 March 2017

Table 6.3.2 Employment And Vacancies By Salary Bands, 31 March 2017

Salary Band No. Of Posts No. Of Posts Filled % Vacancy Rate No. Of Posts Filled Additional To The

Establishment

Lower Skilled (Levels 1-2) 13 13 0 0

Skilled (Levels 3-5) 67 63 6 0

79

Highly Skilled Production (Levels 6-8) 72 63 13 0

Highly Skilled Supervision (Levels 9-12) 59 52 12 0

MEC & Senior Management (Levels 13-16) 16 11 31 0


Table 6.3.3 – Employment and Vacancies by Critical Occupation, 31 March 2017

Table 6.3.3 employment and vacancies by critical occupation, 31 march 2017

Occupations No. Of posts on

approved establishment

No. Of posts filled % vacancy rate No. Of posts filled additional to the establishment

Administrative related 31 29 7 0

Advocates 1 1 0 0

Cashiers tellers and related clerks 1 1 0 0

Cleaners in offices workshops hospitals etc. 18 17 6 0

Client inform clerks(switchb receipt inform clerks) 1 1 0 0

Communication and information related 4 4 0 0

Finance and economics related 28 24 14 0

Financial and related professionals 7 7 0 0

Financial clerks and credit controllers 2 2 0 0

General legal administration & rel. Professionals 3 2 33 0

Human resources &organisatdevelopm& relate prof 6 6 0 0

Human resources clerks 11 11 0 0

Human resources related 6 6 0 0

Information technology related 1 1 0 0

Language practitioners interpreters & other commun 1 1 0 0

Library mail and related clerks 4 3 25 0

Motor vehicle drivers 1 1 0 0

Other administrat& related clerks and organisers 29 28 3 0

Other administrative policy and related officers 14 12 14 0

Regulatory inspectors 9 9 0 0

Safety health and quality inspectors 1 1 0 0

Secretaries & other keyboard operating clerks 13 12 8 0

Security officers 2 2 0 0

Senior managers 14 9 36 0

Trade/industry advisers & other related profession 19 12 37 0


80

6.4FILLING OF SMS POSTS

Table 6.4.1 –Table 1.4.1 SMS post information as on 31 March 2017

Table 6.4.1 SMS post information as on 31 March 2017

SMS Level Total Number of Funded SMS posts

Total Number of SMS posts filled

% of SMS posts filled Total number of SMS posts vacant

% of SMS posts vacant

Salary level 16 0 0 0 0 0



Salary level 13 10 8 80 2 20

Grand Total 15 11 73,3 4 26,7

Table 6.4.2 – Table 6.4.2 SMS post information as on 30 September 2016

Table 6.4.2 SMS post information as on 30 September 2016





Salary level 16 0 0



Salary level 13 10 8 80 2 20

Grand Total 15 11 73,3 4 26,7

Table 6.4.3 – Table 6.4.3 Advertising and filling of SMS posts for the period 1 April 2016 and 31 March 2017

Table 6.4.3 Advertising and Filling of SMS posts for the period 01 April 2016 and 31 March 2017








Salary level 13 10 8 80 2 20

Grand Total 15 11 73 26,7

6.5. JOB EVALUATION

Within a nationally determined framework, executive authorities may evaluate any job in

his or her organisation. In terms of the Regulations all vacancies on salary level 9 and

higher must be evaluated before they are filled. The following table summarises number

of jobs that were evaluated during the year under review.

81

6.5.1 Job Evaluation, 1 April 2016 and 31 March 2017

Salary band

Number of posts on

approved structure

Number of

Jobs

Evaluation

% of posts

evaluated by

salary bands

Posts Upgraded

Posts downgraded

Number % of posts

evaluated

Number % of posts

evaluated

Lower skilled (Levels 1-2) 13 0 0% 0 0% 0 0%

Skilled (Levels 3-5) 65 6 9.2% 0 0% 0 0%

Highly skilled production (Levels 6-8) 61 16 24.6% 0 0% 0 0%

Highly skilled supervision (Levels 9-12) 55 9 16.4% 0 0% 0 0%

Senior Management service (Levels 13-16) 12 4 33.3% 0 0% 0 0%

Contracts 10 0 0% 0 0% 0 0%

Total 216 35 16.2% 0 0% 0 0%

Table 6.5.2 Profile of employees whose salary positions were upgraded due to their posts being upgraded, 1 April 2016 and 31 March 2017

Table 6.5.3 -Employees whose salary level exceed the grade determined by job evaluation, 1 April 2016 and 31 March 2017 (in terms of PSR 1.V.C.3)

Occupation Number of employees

Job evaluation level Remuneration level Reason for deviation

Assistant Director: Risk Management

1 10 10 No consultation was done with DPSA as the Job Evaluation was done through a service provider.

Assistant Director: Salaries 1 10 10 No consultation was done with DPSA as the Job Evaluation was done through a service provider.

Assistant Director: Human Resource Management

1 10 10 No consultation was done with DPSA as the Job Evaluation was done through a service provider.

Assistant Director: Budget 1 10 10 No consultation was done with DPSA as the Job Evaluation was done through a service provider.

Assistant Director: EAP 1 10 10 No consultation was done with DPSA as the Job Evaluation was done through a service provider.

Assistant Director: Monitoring

1 From level 10 10 No consultation was done with DPSA as the Job Evaluation was done through a service provider.

Beneficiaries African Asian Coloured White Total

Female 23 0 0 0 23

Male 11 0 1 0 12

Total 34 0 0 0 35

Employees with a disabilities 1 (Male) 0 0 0 1

82

Occupation Number of employees

Job evaluation level Remuneration level Reason for deviation

Assistant Director: Communications


Deputy Director: Risk Management


Deputy Director: Labour Relations


Total Number of Employees whose salaries exceeded the level determined by job evaluation in 1 April 2016 and 31 March 2017

9

Percentage of total employment 3.6%

Table 6.5.4 Profile of employees whose salary level exceed the grade determined by job evaluation, 1 April 2015 and 31 March 2016 (in terms of PSR 1.V.C.3)

Beneficiaries African Asian white Total

Female 0 0 0 0

Male 0 0 0 0

Total 0 0 0 0

Employees with a disability 0 0 0 0

Total Number of Employees whose salaries exceeded the grade determined by job evaluation in 1 April 2016

and 31 March 2017

None

6.6 EMPLOYMENT CHANGES

This section provides information on changes in employment over the financial year.

Turnover rates provide an indication of trends in the employment profile of the

department. The following tables provide a summary of turnover rates by salary band

and critical occupations.

Table 6.6.1 – Annual turnover rates by salary band for the period 1 April 2016 to 31 March 2017

Table 6.6.1 Annual turnover rates by salary band for the period 1 April 2016 to 31 March 2017

Service Band

Total

employees as

on 1 April

2016

Appointments Transfers into the

Department Terminations

Transfers out

of the

Department

Turnover rate

Lower skilled (Levels 1-2) 13

0

Skilled (Levels 3-5) 63 2 1

0

Highly skilled production (Levels 6-8) 60 1

1 2

Highly skilled supervision (Levels 9-12) 53

1 1 4

Senior Management Service Band A 8 1

1 13

83

(Level 13)

Senior Management Service Band B

(Level 14) 3

1 33

Senior Management Service Band C

(Level 15) 0

MEC & Senior Management Service

Band D (Level 16) 0

Contracts 2 7

17 850

Periodical Remuneration

0

Abnormal Appointment

0

TOTAL 202 11 1 20 2 11

Table 6.6.2 – Annual turnover rates by critical occupation for the period 1 April 2016 to 31 March 2017

Table 6.6.2 Annual turnover rates by critical occupation for the period 1 April 2016 to 31 March 2017

Occupation

Total employees as

on 1 April 2016

Appointments Transfers into the Department

Terminations Transfers out of the Dept.

Turnover rate

ADMINISTRATIVE RELATED 36

1 3

ADVOCATES 1

0

BUILDING AND OTHER PROPERTY CARETAKERS 1

0

CLEANERS IN OFFICES WORKSHOPS HOSPITALS

ETC. 15

0

CLIENT INFORM CLERKS(SWITCHB RECEPT INFORM

CLERKS) 1

0

COMMUNICATION AND INFORMATION RELATED 5

0

FINANCE AND ECONOMICS RELATED 18 2

1 1 11

FINANCIAL AND RELATED PROFESSIONALS 6

1 17

FINANCIAL CLERKS AND CREDIT CONTROLLERS 7

0

GENERAL LEGAL ADMINISTRATION & REL.

PROFESSIONALS 2

0

HUMAN RESOURCES & ORGANISAT DEVELOPM &

RELATE PROF 7

0

HUMAN RESOURCES CLERKS 9 2

4 44

HUMAN RESOURCES RELATED 6

0

LANGUAGE PRACTITIONERS INTERPRETERS &

OTHER COMMUN 1

0

LIBRARY MAIL AND RELATED CLERKS 4

0

LIGHT VEHICLE DRIVERS 1

0

MATERIAL-RECORDING AND TRANSPORT CLERKS 1

0

MESSENGERS PORTERS AND DELIVERERS 1

0

OTHER ADMINISTRAT & RELATED CLERKS AND

ORGANISERS 22 2

11 50

84

OTHER ADMINISTRATIVE POLICY AND RELATED

OFFICERS 9

0

OTHER INFORMATION TECHNOLOGY PERSONNEL. 1

0

PROFESSIONAL NURSE 1

0

REGULATORY INSPECTORS 6

0

ROAD WORKERS 1

0

SECRETARIES & OTHER KEYBOARD OPERATING

CLERKS 15 3 1

0

SECURITY OFFICERS 2

0

SENIOR MANAGERS 11

2 18

TRADE/INDUSTRY ADVISERS & OTHER RELATED

PROFESSION 12 2

1 8

GRAND TOTAL 202 11 1 20 2 11

Table 6.6.3 – Reasons why staff left the department for the period 1 April 2016 and 31 March 2017

Table 6.6.3 – Reasons why staff left the department for the period 1 April 2016 and 31 March 2017

Termination Type Description Total % of Total Resignations % of Total Employment

RETIREMENT – SECTION 16(1)(A) PUBLIC SERVICE ACT 1 5 1

DECEASED 1 5 1

RESIGNATION 1 5 1

EARLY RETIREMENT-SECTION 16(6)(A)PUBLIC SERVICE ACT 1 5 1

CONTRACT EXPIRY 16 80 8

TOTAL 20 100 10

TRANSFER OUT OF PERSAL 0 0 0

INTER DEPARTMENTAL TRANSFER (WITHIN NWPG) 2 9 1

TOTAL INCLUDING TRANSFERS OUT OF PERSAL 22 100 11

Table 6.6.4 – Promotions by critical occupation for the period 1 April 2016 and 31 March 2017

Table 6.6.4 Promotions by critical occupation for the period 1 April 2016 and 31 March 2017

Occupation

Total employees as on 1 April 2016

Total Promotions

Salary Level Promotions as a % of Employment

Total Pay Progression

Notch progressions as a % of employment

ADMINISTRATIVE RELATED 36 0 0 31 86

ADVOCATES 1 0 0 1 100

BUILDING AND OTHER PROPERTY CARETAKERS 1 0 0 1 100

CLEANERS IN OFFICES WORKSHOPS HOSPITALS ETC. 15 0 0 5 33

CLIENT INFORM CLERKS(SWITCHB RECEPT INFORM CLERKS) 1 0 0 0 0

COMMUNICATION AND INFORMATION RELATED 5 0 0 5 100

FINANCE AND ECONOMICS RELATED 18 0 0 10 56

FINANCIAL AND RELATED PROFESSIONALS 6 0 0 5 83

FINANCIAL CLERKS AND CREDIT CONTROLLERS 7 0 0 1 14

85

GENERAL LEGAL ADMINISTRATION & REL. PROFESSIONALS 2 0 0 0 0

HUMAN RESOURCES & ORGANISAT DEVELOPM & RELATE PROF 7 0 0 4 57

HUMAN RESOURCES CLERKS 9 0 0 5 56

HUMAN RESOURCES RELATED 6 0 0 5 83

LANGUAGE PRACTITIONERS INTERPRETERS & OTHER COMMUN 1 0 0 1 100

LIBRARY MAIL AND RELATED CLERKS 4 0 0 3 75

LIGHT VEHICLE DRIVERS 1 0 0 0 0

MATERIAL-RECORDING AND TRANSPORT CLERKS 1 0 0 1 100

MESSENGERS PORTERS AND DELIVERERS 1 0 0 0 0

OTHER ADMINISTRAT & RELATED CLERKS AND ORGANISERS 22 0 0 5 23

OTHER ADMINISTRATIVE POLICY AND RELATED OFFICERS 9 0 0 2 22

OTHER INFORMATION TECHNOLOGY PERSONNEL. 1 0 0 1 100

PROFESSIONAL NURSE 1 0 0 1 100

REGULATORY INSPECTORS 6 0 0 6 100

ROAD WORKERS 1 0 0 0 0

SECRETARIES & OTHER KEYBOARD OPERATING CLERKS 15 1 7 6 40

SECURITY OFFICERS 2 0 0 2 100

SENIOR MANAGERS 11 0 0 4 36

TRADE/INDUSTRY ADVISERS & OTHER RELATED PROFESSION 12 0 0 10 83

TOTAL 202 1 1 115 57

Table 6.6.5 – Promotions by salary band for the period 1 April 2016 and 31 March 2017

Table 6.6.5 Promotions by salary band for the period 1 April 2016 and 31 March 2017

Salary band Total employees as

on 1 April 2016

Promotions To Another Salary

Level

Salary bands promotions as a % of employees by

salary level

Pay Progression Notch progression % of employees by

salary band

Lower skilled (Levels 1-2) 13 0 0 3 23

Skilled (Levels 3-5) 63 0 0 15 24

Highly skilled production (Levels 6-8) 60 1 2 44 73

Highly skilled supervision (Levels 9-12) 53 0 0 47 89

Senior Management (Level 13-16) 11 0 0 3 27

Contracts 2 0 0 3 150


0 0 0 0


0 0 0 0

TOTAL 202 1 1 115 57

86

6.7 EMPLOYMENT EQUITY

Table 6.7.1 – Total number of employees (including employees with disabilities) in each of the following occupational categories as on 31 March

2017

Table 6.7.1 - Total number of employees (including employees with disabilities) in each of the following occupational categories as on 31 March 2017

Occ. Categories Male Female

Grand

Total African Coloured Indian White African Coloured Indian White

Clerks 16

48 2

66

Elementary Occupations 3

14

17

Legislators, Senior Officials, Managers 3

6

9

Plant & Machine Operators and Assemblers 1

1

Professionals 22 1 1

35

59

Service And Sales Workers 1

1

2

Technicians, Associate Professionals 27

22 1 1

51

TOTAL 73 1 1 0 126 3 1 0 205

Employees with disabilities 5

5

10

Table 6.7.2 – Total number of employees (including employees with disabilities) in each of the following occupational bands as on 31 March 2017

Table 6.7.2 - Total number of employees (including employees with disabilities) in each of the following occupational bands as on 31 March 2017

Occupational bands Male Female

Grand


MEC & Top Management (Levels 15-16)

Senior Management (Levels 13-14) 3

7

10

Professionally qualified (Levels 9-12) 27 1 1

20 1 1

51

Skilled technical (Levels 6-8) 18

41 1

60

Semi Skilled (Levels 3-5) 20

45 1

66

Unskilled (Levels 1-2) 2

11

13

Contracts 3

2

5



Total 73 1 1 0 126 3 1 0 205

Employees with disabilities 5 5 10

87

Table 6.7.3– Recruitment for the period 1 April 2016 to 31 March 2017

Table 6.7.3 - Recruitment for the period 1 April 2016 to 31 March 2017

Occupational bands

Male Female Grand


Top Management (Levels 15-16)


1

Professionally qualified (Levels 9-12)


1

Semi Skilled (Levels 3-5)

2

2

Unskilled (Levels 1-2)

Contracts 2

5

7



Total 4 0 0 0 7 0 0 0 11

Transfer into the Dept 1 1

TOTAL INCLUDING TRANSFERS TO

DEPARTMENT 4 0 0 0 8 0 0 0 12


Table 6.7.4 – Promotions for the period 1 April 2016 to 31 March 2017


Occupational bands Male Female Grand



Senior Management (Levels 13-14)


Skilled technical (Levels 6-8) 1 1



Contracts

Total 0 0 0 0 1 0 0 0 1


Table 6.7.5 – Terminations for the period 1 April 2016 to 31 March 2017

Table 6.7.5 – Termination for the period 1 April 2016 to 31 March 2017





2

Professionally qualified (Levels 9-12) 1

1

Skilled technical (Levels 6-8)



Contracts 2

15

17


88


Total Terminations 5 0 0 0 15 0 0 0 20

TRANSFER OF A PERSON TO ANOTHER PERSAL BUREAU

0

INTER DEPARTMENTAL TRANSFER (WITHIN NWPG)

1 1 2

TOTAL INCLUDING TRANSFERS OUT OF PERSAL

6 0 0 0 16 0 0 0 22


6.8. SKILLS DEVELOPMENT

This section highlights the effort of the department with regard to skills development

Table 6.8.1 Training needs identified 1 April 2016 to 31 March 2017

Occupational Categories Gender

Number of employees as at

1/4/2015 – 31/3/2016

Training needs identified at start of reporting period

Total

Learnerships Skills Prorammes other short course

Other forms of training

Legislators, Senior Officials and Managers

F 1

Skills Development Facilitator

1 M

F 1

Risk Management 1 M 1

F 1

Project KHAEDU TOT 1 M 1

Professionals F 3

OHS Conference 1 M 1

F 10

Risk Management 18 M 8

F 2

Excel 2 M -

F 2

Asset Masterclass 3 M 1

F 1

Assessor Moderator 1 M -

F 2

Labour Law

Conferences 4

M 2

Technical and associate professionals F 1

0 M

F

0 M

F

0 M

Clerks F Skills development Facilitator 1

89

M 1

F 15

Excel 8 M 3

F 1

Risk Management 1 M -

F 19

Project Management 25

M 6

F 4

PERSAL 6 M 2

F 18

Contract Management 20 M 2

F 34 CIP 52

M 18

F 12

Basic Computer 19 M 7

F 1

ISO27001 2

M 1

Elementary occupations F

CIP 1 M 1

F 14

Breaking the barriers 15 M 1

F

Basic Computer 1 M 1

M

Total 183

Table 6.8.2 Training provided for the period1 April 2016 to 31 March 2017

Occupational category Male African

Coloured Indian White Female African

Coloured Indian White Total

Legislators, Senior Managers 2 1 0 0 5 1 0 0

9

Professionals 5 0 0

0 9 1 0 0

15

Technicians and associate professionals

2 1 0 0

1 0 0 0

3

Clerks 44 0 0 0

43 0 0 0

134

Elementary occupation 8 0 0 0

11 0 0 0

17

Total 99 1 0

0 99 2 0 0

178

Employees with disability 3 0 0 0 7 0 0 0

10

90

6.9. PERFORMANCE REWARDS

Table 6.9.1 Performance Rewards by race, gender and disability, 1 April 2016 to 31 March 2017

RACE GENDER

Beneficiary Profile Cost

No. of Beneficiaries

No. of Employees as at 31 March 2017

% of total within group

Cost Average cost per

employee

AFRICAN FEMALE 100 126 79 R 1 775 709,99 R 17 757,10

MALE 54 73 74 R 1 259 297,79 R 23 320,30

COLOURED FEMALE 2 3 67 R 33 437,79 R 16 718,90

MALE 1 1 100 R 32 549,31 R 32 549,30

INDIAN FEMALE 1 1 100 R 25 316,13 R 25 316,10

MALE 1 1 100 R 28 932,72 R 28 932,70

WHITE FEMALE 0 R 0,00

MALE 0 R 0,00

TOTAL 159 205 78 R 3 155 243,73 R 19 844,30

EMPLOYEES WITH DISABILITY 6 10 60 R 64 377,90 R 10 729,70

Table 6.9.2 Performance Rewards by salary bands for personnel below Senior Management Service, 1 April 2016 to 31 March 2017

SALARY BANDS


Total cost as a % of the total personel

expenditure No. of

Beneficiaries

No. of Employees as at 31 March

2017

% of total within salary bands

Total Cost Average cost per employee

Lower skilled (Levels 1-2) 11 13 85 R 93 928,68 R 8 539,00 0

Skilled (Levels 3-5) 55 67 82 R 614 649,99 R 11 175,50 1

Highly skilled production (Levels 6-8) 54 63 86 R 1 053 615,45 R 19 511,40 1

Highly skilled supervision (Levels 9-12) 39 51 77 R 1 393 049,61 R 35 719,20 2

Total 159 194 82 R 3 155 243,73 R 19 844,30 4

Table 6.9.3 Performance Rewards by critical occupations, 1 April 2016 to 31 March 2017

Occupation



No. of Employees as at 31 March

2017

% of total within

occupation

Total Cost Average Cost per

employee

ADMINISTRATIVE RELATED 25 35 71 R 754 663,98 R 30 186,60

ADVOCATES 1 1 100 R 28 932,72 R 28 932,70

BUILDING AND OTHER PROPERTY CARETAKERS 1 0 0 R 9 334,17 R 9 334,20

CLEANERS IN OFFICES WORKSHOPS HOSPITALS ETC. 12 17 71 R 99 300,36 R 8 275,00

CLIENT INFORM CLERKS(SWITCHB RECEPT INFORM CLERKS) 1 1 100 R 5 606,64 R 5 606,60

COMMUNICATION AND INFORMATION RELATED 5 5 100 R 174 221,70 R 34 844,30

FINANCE AND ECONOMICS RELATED 16 17 94 R 447 122,49 R 27 945,20

FINANCIAL AND RELATED PROFESSIONALS 5 5 100 R 82 521,75 R 16 504,40

91

FINANCIAL CLERKS AND CREDIT CONTROLLERS 8 10 80 R 91 263,45 R 11 407,90

GENERAL LEGAL ADMINISTRATION & REL. PROFESSIONALS 1 2 50 R 20 110,44 R 20 110,40

HUMAN RESOURCES & ORGANISAT DEVELOPM & RELATE PROF 5 6 83 R 79 921,47 R 15 984,30

HUMAN RESOURCES CLERKS 7 10 70 R 91 037,88 R 13 005,40

HUMAN RESOURCES RELATED 6 7 86 R 136 078,83 R 22 679,80

LANGUAGE PRACTITIONERS INTERPRETERS & OTHER COMMUN 1 1 100 R 19 899,54 R 19 899,50

LIBRARY MAIL AND RELATED CLERKS 2 3 67 R 26 445,06 R 13 222,50

LIGHT VEHICLE DRIVERS 1 1 100 R 15 596,10 R 15 596,10

MATERIAL-RECORDING AND TRANSPORT CLERKS 1 1 100 R 14 761,44 R 14 761,40

OTHER ADMINISTRAT & RELATED CLERKS AND ORGANISERS 1 24 4 R 15 702,24 R 15 702,20

OTHER ADMINISTRATIVE POLICY AND RELATED OFFICERS 21 9 233 R 279 332,49 R 13 301,50

OTHER INFORMATION TECHNOLOGY PERSONNEL. 8 1 800 R 160 484,91 R 20 060,60

PROFESSIONAL NURSE 1 1 100 R 50 148,00 R 50 148,00

REGULATORY INSPECTORS 6 6 100 R 119 429,07 R 19 904,80

SECRETARIES & OTHER KEYBOARD OPERATING CLERKS 1 17 6 R 12 888,96 R 12 889,00

SECURITY OFFICERS 12 2 600 R 177 965,13 R 14 830,40

SENIOR MANAGERS 2 9 22 R 22 104,27 R 11 052,10

TRADE/INDUSTRY ADVISERS & OTHER RELATED PROFESSION 9 14 64 R 220 370,64 R 24 485,60

TOTAL 159 205 78 R 3 155 243,73 R 19 844,30

Table 6.9.4 Performance related rewards (cash bonus) by salary bands for Senior Management Service, 1 April 2016 to 31 March 2017

SALARY BANDS


Total cost as a % of the total

personel expenditure


No. of Employees

as at 31 March 2017

% of total within salary bands

Total Cost Average cost per employee

Senior Management Service Band A (Level 13) 0 8 0 R 0,00 R 0,00 0

Senior Management Service Band B (Level 14) 0 2 0 R 0,00 R 0,00 0

Senior Management Service Band C (Level 15) 0 1 0 R 0,00 R 0,00 0

MEC & Senior Management Service Band D (Level 16) 0 0 R 0,00 R 0,00 0

Total 0 11 0 R 0,00 R 0,00 0

Table 6.7.1 – Total number of employees (including employees with disabilities) in each of the following occupational categories as on 31 March

2017

Table 6.7.1 - Total number of employees (including employees with disabilities) in each of the following occupational categories as on 31 March 2017

Occ. Categories

Male Female Grand


Clerks 16

48 2

66

Elementary Occupations 3

14

17

Legislators, Senior Officials, Managers 3

6

9

Plant & Machine Operators and Assemblers 1

1

Professionals 22 1 1

35

59

Service And Sales Workers 1

1

2

Technicians, Associate Professionals 27

22 1 1

51

TOTAL 73 1 1 0 126 3 1 0 205

92


5

10

Table 6.7.2 – Total number of employees (including employees with disabilities) in each of the following occupational bands as on 31 March 2017

Table 6.7.2 - Total number of employees (including employees with disabilities) in each of the following occupational bands as on 31 March 2017

Occupational bands Male Female

Grand


MEC & Top Management (Levels 15-16)


7

10

Professionally qualified (Levels 9-12) 27 1 1

20 1 1

51


41 1

60

Semi Skilled (Levels 3-5) 20

45 1

66

Unskilled (Levels 1-2) 2

11

13

Contracts 3

2

5



Total 73 1 1 0 126 3 1 0 205

Employees with disabilities 5 5 10

Table 6.7.3– Recruitment for the period 1 April 2016 to 31 March 2017

Table 6.7.3 - Recruitment for the period 1 April 2016 to 31 March 2017

Occupational bands

Male Female Grand




1



1


2

2


Contracts 2

5

7



Total 4 0 0 0 7 0 0 0 11

Transfer into the Dept 1 1

TOTAL INCLUDING TRANSFERS TO

DEPARTMENT 4 0 0 0 8 0 0 0 12


93






Senior Management (Levels 13-14)


Skilled technical (Levels 6-8) 1 1



Contracts

Total 0 0 0 0 1 0 0 0 1


Table 6.7.5 – Terminations for the period 1 April 2016 to 31 March 2017

Table 6.7.5 – Termination for the period 1 April 2016 to 31 March 2017





2

Professionally qualified (Levels 9-12) 1

1

Skilled technical (Levels 6-8)



Contracts 2

15

17



Total Terminations 5 0 0 0 15 0 0 0 20

TRANSFER OF A PERSON TO ANOTHER PERSAL BUREAU

0

INTER DEPARTMENTAL TRANSFER (WITHIN NWPG)

1 1 2

TOTAL INCLUDING TRANSFERS OUT OF PERSAL

6 0 0 0 16 0 0 0 22


6.10 FOREIGN WORKERS

The tables below summarize the employment of foreign nationals in the Department in

terms of salary band and major occupation.

Table 6.10.1 – Foreign workers, 1 April 2016 to 31 March 2017, by salary band

Table 6.10.1 – Foreign workers, 1 April 2016 to 31 March 2017, by salary band

Salary bands 1 April 2016 31 March 2017 Change

Number % of total Number % of total Number % of total

Lower skilled (Levels 1-2) 0 0 0 0 0 0

Skilled (Levels 3-5) 0 0 0 0 0 0

Highly skilled production (Levels 6-8) 0 0 0 0 0 0

Highly skilled supervision (Levels 9-12) 0 0 0 0 0 0

Senior Management (Level 13-16) 0 0 0 0 0 0

Contract (Levels 1-2) 0 0 0 0 0 0




Periodical Remuneration 0 0 0 0 0 0

Abnormal Appointment 0 0 0 0 0 0

Grand Total 0 0 0 0 0 0

94

Table 6.10.2 – Foreign workers, 1 April 2016 to 31 March 2017, by major occupation

Table 6.10.2 – Foreign workers, 1 April 2016 to 31 March 2017, by major occupation

Occupation 1 April 2016 31 March 2017 Change

Number % of total Number % of total Number % of total

0 0 0 0 0 0

Grand Total 0 0 0 0 0 0

6.11 LEAVE UTILIZATION

The Public Service Commission identified the need for careful monitoring of sick leave

within the public service. The following tables provide an indication of the use of sick

leave and disability leave. In both cases, the estimated cost of the leave is also provided.

Table6.11.1 – Sick leave, 1 January 2016 to 31 December 2016

Table 6.11.1 – Sick leave, 1 January 2016 to 31 December 2016

Salary Bands Total Days % days with

medical certification

No of employees using sick

leave

% of total employees using sick

leave

Average days per employee

Estimate Cost (R’000)

Lower Skilled (Levels 1-2) 132 92 14 8 9 R 62 171,75

Skilled (Levels 3-5) 607 89 53 31 11 R 432 625,17

Highly Skilled Production (Levels 6-8) 512 90 52 31 10 R 628 515,38

Highly Skilled Supervision (Levels 9-12) 454 89 39 23 12 R 1 026 486,79

Senior Management (Levels 13-16) 137 91 11 7 12 R 511 995,72

Grand Total 1842 90 169 100 11 R 2 661 794,81

Table 6.11.2 – Disability leave (temporary and permanent), 1 January 2016 to 31 December 2016

Table 6.11.2 – Disability leave (temporary and permanent), 1 January 2016 to 31 December 2016

Salary Bands Total Days % days with

medical certification

No of employees

using disability

leave

% of total employees using sick

leave

Average days per employee

Estimate Cost (R’000)

Lower Skilled (Levels 1-2)

0

0 0

Skilled (Levels 3-5) 352 100 6 46 59 R 262 513,49

Highly Skilled Production (Levels 6-8) 88 100 2 15 44 R 109 258,24

Highly Skilled Supervision (Levels 9-12) 240 100 4 31 60 R 549 575,00

Senior Management (Levels 13-16) 16 100 1 8 16 R 58 860,48

Grand Total 696 100 13 100 54 R 980 207,21

The table below summarises the utilization of annual leave. The wage agreement

concluded with the trade unions in the PSCBC in 2000 requires management of annual

leave to prevent high levels of accrued leave being paid at the time of termination of

service.

95

Table 6.11.3 – Annual leave, 1 January 2016 to 31 December 2016

Table 6.11.3 – Annual leave, 1 January 2016 to 31 December 2016

Salary Bands Total Days No of employees using sick leave Average days per employee

Lower Skilled (Levels 1-2) 301 22 14

Skilled (Levels 3-5) 1215 63 19

Highly Skilled Production (Levels 6-8) 1401 63 22

Highly Skilled Supervision (Levels 9-12) 1249 54 23

Senior Management (Levels 13-16) 256 12 21

Grand Total 4422 214 21

Table 6.11.4 – Capped leave, 1 January 2016 to 31 December 2016

Table 6.11.4 – Capped leave, 1 January 2016 to 31 December 2016

Salary Bands Total days of

capped leave taken No. of Employees

using capped leave Average days per

employee

Average capped leave per

employee as at 31 March 2017

Total number of capped leave

available at 31 March 2017

Lower Skilled (Levels 1-2)

0 13 176,71

Skilled (Levels 3-5)

0 12 792,81

Highly Skilled Production (Levels 6-8)

0 23 1484,39

Highly Skilled Supervision (Levels 9-12) 9 1 9 27 1399,24

Senior Management (Levels 13-16) 2 1 2 11 116,15

Grand Total 11 2 6 19 3969,3

The following table summarizes payments made to employees as a result of leave not

taken. Table 6.11.5 – Leave payouts for the period, 1 April 2016 to 31 March 2017

Table 6.11.5 – Leave payouts for the period, 1 April 2016 to 31 March 2017

Reason Total Amount No of employees Average payment per

employee

Leave payout for 2016/17 due to non-utilisation of leave for the previous cycle R 0,00 0 R 0,00

Capped leave payouts on termination of service for 2015/16 R 0,00 0 R 0,00

Current leave payout on termination of service for 2015/16 R 194 052,18 3 R 64 684,00

Grand Total R 194 052,18 3 R 64 684,00

Table 6.11.6 – Other leave payouts for the period, 1 April 2016 to 31 March 2017

Table 6.11.6 – Other leave payouts for the period, 1 April 2016 to 31 March 2017

Allowance description Sum of Amount Count of PERSAL No. Average payment per

employee

Long Service Award- 20 years-new R 18 582,00 2 R 9 291,00

Long service award-30years-new R 37 164,00 2 R 18 582,00

Grand Total R 55 746,00 4 R 13 937,00

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6.12 HIV AND AIDS & HEALTH PROMOTION PROGRAMMES

TABLE 6.12.1 – Steps taken to reduce the risk of occupational exposure

Units/categories of employees identified to be at high risk of contracting HIV & related diseases (if any)

Key steps taken to reduce the risk

Gender based; Men and women Gender specific awareness dialogues conducted during: men’s and women’s psycho –social and health issues months health awareness sessions/ dialogues on 16 days of Activism on no violence against Women and Children

Youth Health awareness sessions and screening on HIV and AIDS, STI and TB as well as screening and management of non chronic conditions

TABLE 6.12.2 – Details of Health Promotion and HIV and AIDS Programmes (tick the applicable boxes and provide the required information)

Question Yes No Details, if yes

1. Has the department designated a member of the SMS to implement the provisions contained in Part VI E of Chapter 1 of the Public Service Regulations, 2001? If so, provide her/his name and position.

X Mr. MT Molefe

2. Does the department have a dedicated unit or has it designated specific staff members to promote the health and well being of your employees? If so, indicate the number of employees who are involved in this task and the annual budget that is available for this purpose.

X Ms. IG Mogodi Mr. ML. Kgokong Ms K. Moloto Ms. NI. Seephe

3. Has the department introduced an Employee Assistance or Health Promotion Programme for your employees? If so, indicate the key elements/services of this Programme.

X *HIV & AID and TB management *Safety Health Environment Risk and Quality management, * Wellness management, * Health and Productivity management Services are proactive; Prevention programs and reactive: Provision of treatment care and support

4. Has the department established (a) committee(s) as contemplated in Part VI E.5 (e) of Chapter 1 of the Public Service Regulations, 2001? If so, please provide the names of the members of the committee and the stakeholder(s) that they represent.

X Mr. MT. Molefe: HRM&D, Ms P. Magor: Rusteburg: Regional Office MTS Phologane: Brits : Regional Office Ms. I Koyo: HRM Ms. I. Mogodi; Corporate Services Ms. L. Kgokong; HRM :EHW Ms. K. Moletsane: Legal Services Ms.RefilweMadilola: Integrated Economic Development Services Ms.V.Menong: Finance Ms. Shale Motlhoki: Labour Union Ms. NI. Seephe: HR&M :EHW Mr. C. Mohelekete: Labour Union Mr. T. Matlhoko: Communication and IT

5. Has the department reviewed its employment policies and practices to ensure that these do not unfairly discriminate against employees on the basis of their HIV status? If so, list the employment policies/practices so reviewed.

X None

6. Has the department introduced measures to protect HIV-positive employees or those perceived to be HIV-positive from discrimination? If so, list the key elements of these measures.

Confidentiality maintained during HCT and Voluntary disclosure Prompt referral of cases for proper diagnosis and management

7. Does the department encourage its employees to undergo Voluntary Counselling and Testing? If so, list the results that you have achieved.

Seven (7) HIV Counselling and Testing (HIV) campaigns conducted 108 officials tested for HIV 50% (40 males and 68 females

8. Has the department developed measures/indicators to monitor & evaluate the impact of its health promotion programme? If so, list these measures/indicators.

Systems Monitoring Tool

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6.13 LABOUR RELATIONS

Table 6.13.1 Collective agreements for the period 1 April 2016 and 31 March 2017

None

TABLE 6.13.2 – Misconduct and disciplinary hearings finalised, 1 April 2016 to 31 March 2017

Outcomes of disciplinary hearings Number % of total

Written warning 4 66.66%

Final written warning 1 33.33%

Total 5 100%

TABLE 6.13.3 – Types of misconduct addressed at disciplinary hearings

Type of misconduct Number % of total

Fraud 1 0%

Negligence 0 20%

Absenteeism 0 0%

Theft 0 40%

Contravention of Supply Chain Policy 1 40%

Total 2 100%

TABLE 6.13.4 – Grievances lodged for the period 1 April 2016 to 31 March 2017

TABLE 6.13.5 – Disputes lodged with Councils for the period 1 April 2016 to 31 March 2017

Number % of Total

Number of disputes upheld Nil 0%

Number of disputes dismissed 1 12.5%

Number of disputes lodged 3 87.75%

Number % of Total

Number of grievances resolved 4 100 90

Number of grievances not

resolved

1 10

Total number of grievances

lodged

5 100

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Table 6.13.6 Strike Actions for the period 1 April 2016 to 31 March 2017

Nil

Table 6.13.7 – Precautionary suspensions for the period 1 April 2016 to 31 March 2017

Number of people suspended

Number of people whose suspension exceeded 30 days 0

Average number of days suspended 0

Cost (R’000) of suspensions 0

6.14 INJURY ON DUTY

The following tables provide basic information on injury on duty.

Table 6.14.1 Injury on duty, 1 April 2016 to 31 March 2017

Nature of injury on duty Total % of Total

Required basic medical attention only 7 100%

Motor vehicle accident (driver) 1 14%

Motor vehicle accident (Passenger) 2 29%

Other injuries 4 57%

Resume duty 7 100%

Total 7 100%

Effect of injury on duty Total % of Total

DECEASED 0 0

NONE - RESUME DUTY 0 0

TOTAL 0 0

6.15 UTILISATION OF CONSULTANTS

Table 6.15.1 – Report on consultant appointments using appropriated funds

Project Title Total number of consultants that

worked on the project

Duration:

Work days

Contract value in

Rand

Nil Nil Nil Nil

Total number of projects Total individual consultants Total duration:

Work days Total contract value in Rand

Nil Nil Nil Nil

99

Table 6.15.2 – Analysis of consultant appointments using appropriated funds, in terms of Historically Disadvantaged Individuals (HDIs)

Project Title Percentage ownership by

HDI groups

Percentage management by

HDI groups

Number of Consultants from HDI groups

that work on the project

Nil Nil Nil Nil

Table 6.15.3 – Report on consultant appointments using Donor funds

Project Title Total Number of consultants that

worked on the project Duration: Work days Donor and Contract value in Rand

Nil Nil Nil Nil

Total number of projects Total individual consultants Total duration: Work

days Total contract value in Rand

Nil Nil Nil Nil

Table6.15.4 – Analysis of consultant appointments using Donor funds, in terms of Historically Disadvantaged Individuals (HDIs)

Project

Title

Percentage ownership by HDI groups Percentage management by HDI

groups

Number of Consultants from HDI groups

that work on the project

Nil Nil Nil Nil

6.16 SEVERANCE PACKAGE

Table 6.16.1 Granting of employee initiated severance packages for the period 1 April 2014 and 31 March 2015

SALARY BANDS No of Application s

received

No. of Applications

referred to the

MPSA

No. of Applications

supported MPSA

Number of packages

approved by Department

Nil Nil Nil Nil Nil

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PART E: FINANCIAL INFORMATION

101

Report of the auditor-general to the North West provincial legislature

on vote no. 6: the Department of Economy and Enterprise

Development

Report on the audit of the financial statements

Opinion

1. I have audited the financial statements of the Department of Economy and Enterprise Development set out on pages 116 to 144, which comprise the appropriation statement, the statement of financial position as at 31 March 2017, and the statement of financial performance, statement of changes in net assets, and cash flow statement for the year then ended, as well as the notes to the financial statements, including a summary of significant accounting policies.

2. In my opinion, the financial statements present fairly, in all material respects, the financial position of the Department of Economy and Enterprise Development as at 31 March 2017, and its financial performance and cash flows for the year then ended in accordance with the Modified Cash Standard (MCS) prescribed by the National Treasury and the requirements of the Public Finance Management Act of South Africa, 1999 (Act No. 1 of 1999) (PFMA) and the Division of Revenue Act of South Africa, 2016 (Act No. 3 of 2016) (DoRA).

Basis for opinion

3. I conducted my audit in accordance with the International Standards on Auditing (ISAs). My responsibilities under those standards are further described in the auditor-general’s responsibilities for the audit of the financial statements section of my report.

4. I am independent of the department in accordance with the International Ethics Standards Board for Accountants’ Code of ethics for professional accountants (IESBA code) together with the ethical requirements that are relevant to my audit in South Africa. I have fulfilled my other ethical responsibilities in accordance with these requirements and the IESBA code.

5. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.

Other matter

6. I draw attention to the matter below. My opinion is not modified in respect of this matter.

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Unaudited supplementary schedules

7. The supplementary information set out on pages 30 to 36 does not form part of the financial statements and is presented as additional information. I have not audited these schedules and, accordingly, I do not express an opinion thereon.

Responsibilities of accounting officer for the financial statements

8. The accounting officer is responsible for the preparation and fair presentation of the financial statements in accordance with the MCS prescribed by the National Treasury and the requirements of the PFMA and the DoRA and for such internal control as the accounting officer determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

9. In preparing the financial statements, the accounting officer is responsible for assessing the department’s ability to continue as a going concern, disclosing, as applicable, matters relating to going concern and using the going concern basis of accounting unless the there is an intention either to liquidate the department or to cease operations, or there is no realistic alternative but to do so.

Auditor-general’s responsibilities for the audit of the financial statements

10. My objectives are to obtain reasonable assurance about whether financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes my opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

11. A further description of my responsibilities for the audit of the financial statements is included in the annexure to the auditor’s report.

Report on the audit of the annual performance report

Introduction and scope

12. In accordance with the Public Audit Act of South Africa, 2004 (Act No. 25 of 2004) (PAA) and the general notice issued in terms thereof I have a responsibility to report material findings on the reported performance information against predetermined objectives for selected programmes presented in the annual performance report. I performed procedures to identify findings but not to gather evidence to express assurance.

13. My procedures address the reported performance information, which must be based on the approved performance planning documents of the department. I have not evaluated the completeness and appropriateness of the performance indicators included in the planning documents. My procedures also did not extend to any disclosures or assertions relating to planned performance strategies and information in respect of future periods that may be included as part of the reported performance information. Accordingly, my findings do not extend to these matters.

14. I evaluated the usefulness and reliability of the reported performance information in accordance with the criteria developed from the performance management and reporting framework, as defined in the general notice, for the following selected

103

programmes presented in the annual performance report of the department for the year ended 31 March 2017:

Programmes Pages in the annual

performance report

Programme 2 – Integrated Economic Development Services 52 – 56

Programme 3 – Economic Planning and Sector Development 57– 62

Programme 4 – Business Regulations and Governance 63 – 66

15. I performed procedures to determine whether the reported performance information was

properly presented and whether performance was consistent with the approved performance planning documents. I performed further procedures to determine whether the indicators and related targets were measurable and relevant, and assessed the reliability of the reported performance information to determine whether it was valid, accurate and complete.

16. The material findings in respect of the usefulness and reliability of the selected programmes are as follows:

Programme 2 – Integrated Economic Development Services

Various indicators

17. The reported achievements for the following indicators were misstated as the evidence provided did not agree with the reported value:

Indicator Reported achievement

Audit value

Number of existing SMMEs supported in the VTSD 256 182

Number of new SMMEs developed in the VTSD 223 281

Number of new co-operatives developed in the VTSD The impact on the accuracy of the reported reason for the deviation in the achievement must be considered in the context of this material finding.

152 110

Number of informal businesses supported in the VTSD 154 137

Number of funding referrals to public institutions 57 81

Number of new LED projects supported at local and regional levels The impact of not reporting a reason for the deviation in the achievement must be considered in the context of this material finding.

19 17

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Programme 3 – Economic Planning and Sector Development

Strategic objective: To facilitate the growth and development of economic

opportunities within the agro-processing, mining beneficiation,

manufacturing and the green economy sectors

18. The strategic objective was reported as “To facilitate the growth and development of economic opportunities within the agro-processing, mining beneficiation, manufacturing and the green economy sectors” while the planned strategic objective was approved as “To facilitate the growth and development of economic opportunities within the agro-processing, mining beneficiation, manufacturing, tourism/culture and the green economy sectors” in the annual performance plan. This is not in line with the requirements of Treasury Regulation 5.2.4. The change was also not approved as required by Treasury Regulation 5.1.1.

Various indicators

19. The following indicators were not clearly defined, as required by the Framework for Managing Programme Performance Information (FMPPI), as the technical indicator descriptions did not clearly define how the planned targets will be achieved:

Number of economic VTSD strategies developed

Number of strategies reviewed

Programme 4 – Business Regulations and Governance

Indicator: Number of reports on retail licensing

20. The indicator was reported as “Number of reports on retail licensing” while the indicator was approved as “Number of Municipality Monitoring reports on business licensing” in the annual performance plan. This is not in line with the requirements of Treasury Regulation 5.2.4. The change was also not approved as required by Treasury Regulation 5.1.1. In addition, the indicator was not clearly defined, as required by the FMPPI, as the technical indicator description did not clearly define how the planned target will be achieved.

Indicator: Number of consumer education awareness conducted

21. The indicator was not clearly defined, as required by the FMPPI, as the technical indicator description did not clearly define how the planned target will be achieved.

Various indicators

22. The following indicators were not clearly defined, as required by the FMPPI, as the technical indicator descriptions did not clearly define how the planned targets will be achieved:

Number of investigations into market practices finalised

Percentage of consumer court cases resolved by the court

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Various indicators

23. The reported achievement for the following indicators was misstated as the evidence provided did not agree with the reported value:

Indicator Reported achievement

Audit value

Number of awareness programmes conducted with emphasis on VTSD

146 122

Number of social responsibility programmes conducted with emphasis on VTSD The impact on the accuracy of the reported reason for the deviation in the achievement must be considered in the context of this material finding.

6 4

Other matters

24. I draw attention to the matters below.

Achievement of planned targets

25. Refer to the annual performance report on pages 40 to 68 for information on the achievement of planned targets for the year and explanations provided for the under/overachievement of a significant number of targets. This information should be considered in the context of the material findings on the usefulness and reliability of the reported performance information in paragraphs 17 to 23 of this report.

Report on audit of compliance with legislation

Introduction and scope

26. In accordance with the PAA and the general notice issued in terms thereof I have a responsibility to report material findings on the compliance of the department with specific matters in key legislation. I performed procedures to identify findings but not to gather evidence to express assurance.

27. I did not identify any instances of material non-compliance in respect of the compliance criteria for the applicable subject matters.

Other information

28. The accounting officer of is responsible for the other information. The other information comprises the information included in the annual report which includes the accounting officer’s report and the audit committee’s report. The other information does not include the financial statements, the auditor’s report thereon and those selected programmes presented in the annual performance report that have been specifically reported on in the auditor’s report.

29. My opinion and findings do not cover the other information and I do not express an audit opinion or any form of assurance conclusion thereon.

30. In connection with my audit, my responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements and the selected programmes presented in the annual

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performance report, or my knowledge obtained in the audit, or otherwise appears to be materially misstated.

31. If, based on the work I have performed on the other information obtained prior to the date of this auditor’s report, I conclude that there is a material misstatement of this other information, I am required to report that fact. I have nothing to report in this regard.

Internal control deficiencies

32. I considered internal control relevant to my audit of the financial statements, reported performance information and compliance with applicable legislation; however, my objective was not to express any form of assurance thereon. The matters reported below are limited to the significant internal control deficiencies that resulted in the findings on the annual performance report included in this report:

Management did not respond to internal control deficiencies relating to the collection, collation, verification, storing and reporting of actual performance information identified by internal audit.

Potchefstroom

31 July 2017

107

Annexure – Auditor-general’s responsibility for the audit

1. As part of an audit in accordance with the ISAs, I exercise professional judgement and maintain professional scepticism throughout my audit of the financial statements, and the procedures performed on reported performance information for selected programmes and on the department’s compliance with respect to the selected subject matters.

Financial statements

2. In addition to my responsibility for the audit of the financial statements as described in the auditor’s report, I also:

identify and assess the risks of material misstatement of the financial statements whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the department’s internal control.

evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the accounting officer.

conclude on the appropriateness of the accounting officer’s use of the going concern basis of accounting in the preparation of the financial statements. I also conclude, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Department of Economy and Enterprise Development ability to continue as a going concern. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor’s report to the related disclosures in the financial statements about the material uncertainty or, if such disclosures are inadequate, to modify the opinion on the financial statements. My conclusions are based on the information available to me at the date of the auditor’s report. However, future events or conditions may cause a department’s to cease to continue as a going concern.

evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

Communication with those charged with governance

3. I communicated with the accounting officer regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that I identify during my audit.

4. I also confirm to the accounting officer that I have complied with relevant ethical requirements regarding independence, and communicate all relationships and other matters that may reasonably be thought to have a bearing on my independence and here applicable, related safeguards.

108

DEPARTMENT OF ECONOMIC AND ENTERPRISE DEVELOPMENT

VOTE 6

ACCOUNTING POLICIES for the year ended 31 March 2017

Summary of significant accounting policies

The financial statements have been prepared in accordance with the following policies,

which have been applied consistently in all material aspects, unless otherwise indicated.

Management has concluded that the financial statements present fairly the department‟s

primary and secondary information.

The historical cost convention has been used, except where otherwise indicated.

Management has used assessments and estimates in preparing the annual financial

statements. These are based on the best information available at the time of preparation.

Where appropriate and meaningful, additional information has been disclosed to enhance

the usefulness of the financial statements and to comply with the statutory requirements of

the Public Finance Management Act (PFMA), Act 1 of 1999 (as amended by Act 29 of 1999),

and the Treasury Regulations issued in terms of the PFMA and the annual Division of

Revenue Act.

1 Basis of preparation

The financial statements have been prepared in accordance with the Modified Cash

Standard.

2 Going concern

The financial statements have been prepared on a going concern basis.

3 Presentation currency

Amounts have been presented in the currency of the South African Rand (R) which

is also the functional currency of the department.

4 Rounding

Unless otherwise stated financial figures have been rounded to the nearest one

thousand Rand (R‟000).

109

5 Foreign currency translation

Cash flows arising from foreign currency transactions are translated into South

African Rands using the spot exchange rates prevailing at the date of payment /

receipt.

6 Comparative information

6.1 Prior period comparative information

Prior period comparative information has been presented in the current year‟s

financial statements. Where necessary figures included in the prior period financial

statements have been reclassified to ensure that the format in which the information

is presented is consistent with the format of the current year‟s financial statements.

6.2 Current year comparison with budget

A comparison between the approved, final budget and actual amounts for each

programme and economic classification is included in the appropriation statement.

7 Revenue

7.1 Appropriated funds

Appropriated funds comprises of departmental allocations as well as direct charges

against the revenue fund (i.e. statutory appropriation).

Appropriated funds are recognised in the statement of financial performance on the

date the appropriation becomes effective. Adjustments made in terms of the

adjustments budget process are recognised in the statement of financial

performance on the date the adjustments become effective.

The net amount of any appropriated funds due to / from the relevant revenue fund

at the reporting date is recognised as a payable / receivable in the statement of

financial position.

7.2 Departmental revenue

Departmental revenue is recognised in the statement of financial performance when

received and is subsequently paid into the relevant revenue fund, unless stated

otherwise.

Any amount owing to the relevant revenue fund at the reporting date is recognised

as a payable in the statement of financial position.

7.3 Accrued departmental revenue

110

Accruals in respect of departmental revenue (excluding tax revenue) are recorded in

the notes to the financial statements when:

it is probable that the economic benefits or service potential associated with the

transaction will flow to the department; and

the amount of revenue can be measured reliably.

The accrued revenue is measured at the fair value of the consideration receivable.

Accrued tax revenue (and related interest and / penalties) is measured at amounts

receivable from collecting agents.

8 Expenditure

8.1 Compensation of employees

8.1.1 Salaries and wages

Salaries and wages are recognised in the statement of financial performance on the

date of payment.

8.1.2 Social contributions

Social contributions made by the department in respect of current employees are

recognised in the statement of financial performance on the date of payment.

Social contributions made by the department in respect of ex-employees are

classified as transfers to households in the statement of financial performance on

the date of payment.

8.2 Other expenditure

Other expenditure (such as goods and services, transfers and subsidies and

payments for capital assets) is recognised in the statement of financial performance

on the date of payment. The expense is classified as a capital expense if the total

consideration paid is more than the capitalisation threshold.

8.3 Accrued expenditure payable

Accrued expenditure payable is recorded in the notes to the financial statements

when the goods are received or, in the case of services, when they are rendered to

the department or in the case of transfers and subsidies when they are due and

payable.

Accrued expenditure payable is measured at cost.

8.4 Leases

8.4.1 Operating leases

111

Operating lease payments made during the reporting period are recognised as

current expenditure in the statement of financial performance on the date of

payment.

The operating lease commitments are recorded in the notes to the financial

statements.

8.4.2 Finance leases

Finance lease payments made during the reporting period are recognised as capital

expenditure in the statement of financial performance on the date of payment.

The finance lease commitments are recorded in the notes to the financial statements

and are not apportioned between the capital and interest portions.

Finance lease assets acquired at the end of the lease term are recorded and

measured at the lower of:

cost, being the fair value of the asset; or

the sum of the minimum lease payments made, including any payments made to

acquire ownership at the end of the lease term, excluding interest.

9 Cash and cash equivalents

Cash and cash equivalents are stated at cost in the statement of financial position.

Bank overdrafts are shown separately on the face of the statement of financial

position as a current liability.

For the purposes of the cash flow statement, cash and cash equivalents comprise

cash on hand, deposits held, other short-term highly liquid investments and bank

overdrafts.

10 Loans and receivables

Loans and receivables are recognised in the statement of financial position at cost

plus accrued interest, where interest is charged, less amounts already settled or

written-off. Write-offs are made according to the department‟s write-off policy.

11 Payables

Loans and payables are recognised in the statement of financial position at cost.

12 Capital Assets

12.1 Immovable capital assets

112

Immovable capital assets are initially recorded in the notes to the financial

statements at cost. Immovable capital assets acquired through a non-exchange

transaction is measured at fair value as at the date of acquisition.

Where the cost of immovable capital assets cannot be determined reliably, the

immovable capital assets are measured at R1 unless the fair value of the asset has

been reliably estimated, in which case the fair value is used.

All assets acquired prior to 1 April 2002 (or a later date as approved by the OAG)

may be recorded at R1.

Immovable capital assets are subsequently carried at cost and are not subject to

depreciation or impairment.

Subsequent expenditure that is of a capital nature is added to the cost of the asset

at the end of the capital project unless the immovable asset is recorded by another

department in which case the completed project costs are transferred to that

department.

12.2 Movable capital asset

Movable capital assets are initially recorded in the notes to the financial statements

at cost. Movable capital assets acquired through a non-exchange transaction is

measured at fair value as at the date of acquisition.

Where the cost of movable capital assets cannot be determined reliably, the

movable capital assets are measured at fair value and where fair value cannot be

determined; the movable assets are measured at R1.



Movable capital assets are subsequently carried at cost and are not subject to



at the end of the capital project unless the movable asset is recorded by another

department/entity in which case the completed project costs are transferred to that

department.

12.3 Intangible assets

Intangible assets are initially recorded in the notes to the financial statements at

cost. Intangible assets acquired through a non-exchange transaction are measured

at fair value as at the date of acquisition.

Internally generated intangible assets are recorded in the notes to the financial

statements when the department commences the development phase of the project.

Where the cost of intangible assets cannot be determined reliably, the intangible

capital assets are measured at fair value and where fair value cannot be

determined; the intangible assets are measured at R1.

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Intangible assets are subsequently carried at cost and are not subject to



at the end of the capital project unless the intangible asset is recorded by another

department/entity in which case the completed project costs are transferred to that

department.

13 Provisions and Contingents

13.1 Provisions

Provisions are recorded in the notes to the financial statements when there is a

present legal or constructive obligation to forfeit economic benefits as a result of

events in the past and it is probable that an outflow of resources embodying

economic benefits or service potential will be required to settle the obligation and a

reliable estimate of the obligation can be made. The provision is measured as the

best estimate of the funds required to settle the present obligation at the reporting

date.

13.2 Contingent liabilities

Contingent liabilities are recorded in the notes to the financial statements when

there is a possible obligation that arises from past events, and whose existence will

be confirmed only by the occurrence or non-occurrence of one or more uncertain

future events not within the control of the department or when there is a present

obligation that is not recognised because it is not probable that an outflow of

resources will be required to settle the obligation or the amount of the obligation

cannot be measured reliably.

13.3 Commitments(other than for transfers and subsidies)

Commitments are recorded at cost in the notes to the financial statements when

there is a contractual arrangement or an approval by management in a manner that

raises a valid expectation that the department will discharge its responsibilities

thereby incurring future expenditure that will result in the outflow of cash.

13.4 Employee benefits

The value of each major class of employee benefit obligations(accruals, payables not

recognised and provisions) is disclosed in the Employee benefits note.

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14 Unauthorised expenditure

Unauthorised expenditure is recognised in the statement of financial position until

such time as the expenditure is either:

approved by Parliament or the Provincial Legislature with funding and the related

funds are received; or

approved by Parliament or the Provincial Legislature without funding and is

written off against the appropriation in the statement of financial performance;

or

transferred to receivables for recovery.

Unauthorised expenditure is measured at the amount of the confirmed unauthorised

expenditure.

15 Fruitless and wasteful expenditure

Fruitless and wasteful expenditure is recorded in the notes to the financial

statements when confirmed. The amount recorded is equal to the total value of the

fruitless and or wasteful expenditure incurred.

Fruitless and wasteful expenditure is removed from the notes to the financial

statements when it is resolved or transferred to receivables for recovery.

Fruitless and wasteful expenditure receivables are measured at the amount that is

expected to be recoverable and are de-recognised when settled or subsequently

written-off as irrecoverable.

16 Irregular expenditure

Irregular expenditure is recorded in the notes to the financial statements when

confirmed. The amount recorded is equal to the value of the irregular expenditure

incurred unless it is impracticable to determine, in which case reasons therefor are

provided in the note.

Irregular expenditure is removed from the note when it is either condoned by the

relevant authority, transferred to receivables for recovery or not condoned and is

not recoverable.

Irregular expenditure receivables are measured at the amount that is expected to be

recoverable and are de-recognised when settled or subsequently written-off as

irrecoverable.

17 Recoverable revenue

Amounts are recognised as recoverable revenue when a payment made in a

previous financial year becomes recoverable from a debtor in the current financial

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year. Amounts are either transferred to the Provincial Revenue Fund when

recovered or are transferred to the statement of financial performance when

written-off.

18 Related party transactions

A related party transaction is a transfer of resources, services or obligations between

the reporting entity and a related party. Related party transactions within the

Minister/MEC‟s portfolio are recorded in the notes to the financial statements when

the transaction is not at arm‟s length.

Key management personnel are those persons having the authority and

responsibility for planning, directing and controlling the activities of the department.

The number of individuals and their full compensation is recorded in the notes to the

financial statements.

THE DEPARTMENT OF

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