Transcript SG 2 - Amazon Web Services

the dti
Presentation on the Annual Report 2013/14
Mr Shabeer Khan
Chief Financial Officer
29 October 2014
1
Presentation Outline
•
•
•
•
Economic Context
Strategic Goals
The structure of the dti’s work
Annual Performance 2013/14
– Key achievements
– Summary of achievement of targets
– Financial Management
• Challenges
2
Economic context
3
Global Economy
January – March 2014 (Q1 2014)
 Global gross domestic product (GDP) growth slowed from an
annualised quarter-on-quarter rate of 3.4% in the fourth quarter of 2013 to
2.1% in the first quarter of 2014.
 This was primarily due to a 2.1% contraction of GDP in the United
States (US) and slowing growth in China and the European Union (EU).
April – June 2014 (Q2 2014)
 Global GDP growth likely recovered slightly in the second quarter as
the US economy rebounded strongly and grew by 4% on an annualised
quarter-on-quarter basis
 Economic conditions in the EU worsened however with Germany
surprisingly contracting
4
Global Economy
Quarterly GDP, Seasonally-adjusted and Annualised
20.0%
15.0%
10.0%
5.0%
0.0%
-5.0%
-10.0%
USA
Euro area
China
Japan
Source: International Monetary Fund IMF
5
Global Economy
 International Monetary Fund (IMF) expects world output growth to
rebound in the second quarter of 2014 and firmer in 2015 and 2016.
 The IMF further projects that imports by advanced economies will
increase from 1.4% per annum in 2013 to 4.6% per annum in 2015.
 Overall, the economic growth outlook remains weak with significant
downside risks.
6
Domestic Economy
 Real GDP grew by an annualised quarter-on-quarter rate of 0.6% in
the second quarter of 2014.
 South Africa’s growth performance was led by the tertiary sector,
mainly:
o Government services,
o Finance, real estate and business services, and
o Transport, storage and communication services.
 The Manufacturing sector contracted by 2.1% in the second quarter of
2014 due to low production in autos, chemical products, rubber and
plastics, glass and non-metallic mineral products.
 The contraction in Manufacturing was primarily due to the slow pick up
in the mining sector after the prolonged strike in the platinum sector.
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Domestic Economy
Source: Statssa
8
Domestic Economy
 SA exports and imports to the world declined in the second quarter of
2014.
 Imports declined particularly significantly leading to an improvement in
SA’s trade deficit.
 SA exports to Africa increased from R70.2bn to R71.9 bn resulting in a
trade surplus of R39.5 bn with the continent.
 SA trade with the world and BRICS were affected by poor growth in
the EU and the US.
 Demand for commodities and commodity prices remain relatively flat
as China’s policymakers attempt to re-balance the economy.
 SA trade with Africa consequently remains a priority focus for the dti.
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Domestic Economy
SA trade with the world, Current Rands
300
250
200
Billions
150
100
50
0
1Q
-50
2Q
3Q
4Q
1Q
2Q
2010
SA exports to WORLD
3Q
2011
4Q
1Q
2Q
3Q
2012
SA imports from WORLD
4Q
1Q
2Q
3Q
4Q
1Q
2013
2Q
2014
SA trade balance with WORLD
Source: the dti
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Strategic Goals
the dti’s strategic goals for the period under review were:
 Facilitate transformation of the economy to promote industrial
development, investment, competitiveness and employment creation.
 Build mutually beneficial regional and global relations to advance South
Africa’s trade, industrial policy and economic development objectives.
 Facilitate broad-based economic participation through targeted
interventions to achieve more inclusive growth.
 Create a fair regulatory environment that enables investment, trade and
enterprise development in an equitable and socially responsible
manner.
 Promote a professional, ethical, dynamic, competitive and customerfocused working environment that ensures effective and efficient service
delivery.
The structure of the dti’s work
the dti’s work is organised in terms of the following
clusters:





Industrial development;
Trade, Investment and Exports;
Broadening participation;
Regulation, and
Administration and co-ordination
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12
Key achievements against
planned targets for 2013/14
Financial Year
Industrial Development
SG 1: Facilitate transformation of the economy to promote industrial
development, investment, competitiveness and employment creation
The sixth iteration of the annual rolling Industrial Policy Action Plan (IPAP
2013/14-2015/16) was successfully launched in April 2013 and
implementation reports were produced.
Key Achievements
The new SABS Local Content Verification Office was officially launched
in July 2013 together with a new technical instrument (SATS) 1286 in
support of South Africa’s localisation strategy.
Revised National Industrial Participation Programme (NIPP) guidelines
were approved, effectively closing existing loopholes with respect to
multiplier calculations.
Concluded local content verification for all transversal contractors on
clothing, textiles, leather and footwear (CTLF) tenders with contract value of
R1 million or above in December 2013 to gauge compliance with
designation instructions.
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14
Industrial Development
SG 1: Facilitate transformation of the economy to promote industrial
development, investment, competitiveness and employment creation
Total investment attracted into the Autos sector amounted to R16 billion.
Since the designation of buses, 300 buses have been procured with
localisation requirements as set out in the Designation Instruction Note.
Key Achievements
 Major contracts included:
• Mercedes-Benz SA’s successful tender to provide 134 buses for
phase 1B of Johannesburg’s Rea Vaya Bus Rapid Transport (BRT)
system;
• Volvo SA’s successful tender to provide 40 new vehicles to the City of
Cape Town for its extended MyCiti bus routes, at a cost of R180
million; and
• MAN supplying 80 new commuter buses to Great North Transport,
Limpopo’s largest public transit operator.
 The Automotive Supply Chain Competitiveness Initiative (ASCCI), a
partnership between government, labour and business was launched in
October 2013.
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Industrial Development
SG 1: Facilitate transformation of the economy to promote industrial
development, investment, competitiveness and employment creation
 Mercedes-Benz SA has escalated its total investment in South Africa to
more than R5 billion, underpinning an increase in its local output to 100
000 units a year and creating 800 new jobs.
Key Achievements
 Production of the new C-Class has already started at the Mercedes’ East
London plant, and will slowly ramp up from the current 250 units to full
capacity of 420 units a day.
 General Motors SA (GMSA), in partnership with component manufacturer
Tenneco SA, had been awarded a R6 billion contract to export catalytic
converters to North America.
 Part of the 2013/14 Family Planning Tender (all SA-made contraceptives)
worth an estimated R100 million has been designated.
 Significant progress has been made in the Renewable Energy
Independent Power Producer Procurement Programme (REIPPPP), with
the Department of Energy (DOE) approving 19 bids in the second round
of the solar photovoltaic, wind, small hydro and concentrated solar power
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sectors.
Industrial Development
SG 1: Facilitate transformation of the economy to promote industrial
development, investment, competitiveness and employment creation
 Transnet announced its intention to purchase more than 1 000
locomotives at an estimated value of R50 billion. The Transnet contract
commits locomotive manufacturers to a target of 65% local content over
time and these will create and preserve approximately 30 000 jobs.
 Approximately 3 233 unemployed learners enrolled for training and 2
417 placed to increase the pool of agents suitable for middle
management in the Monyetla Work Readiness Programme.
 The film Long Walk to Freedom, was produced at a cost of R239
million, premiered and released countrywide in November 2013, earning
more than R23 million at the box-office to become the highest-grossing
film in the country
 In agro-processing, the dti, in collaboration with Buhler, launched the
innovative Isigayo plant in April 2013.
 MCEP funding approved: 29.7% spent on Agro-processing, 15.7% spent
on metals sector and the remainder was spread across other sectors
Key Achievements
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Industrial Development
SG 1: Facilitate transformation of the economy to promote industrial
development, investment, competitiveness and employment creation
The Clothing and Textile Competitiveness Programme (CTCP) has
stabilised the CTLF sector and much progress has been made since the
launch of the programme:
• 44 applications were received to the value of R 645 million under the
Competitiveness Improvement Programme (CIP), with R77.7
million already disbursed.
• 777 approvals have been made to date, under the Production
Incentive Programme (PIP), to a total value of R2.2 billion. Since
inception 63 311 jobs have been saved and 8 459 jobs created.
Key Achievements
 Two new regional footwear clusters have been established under the
National Leather and Footwear Cluster Initiative – the Fast-Track Cluster
(Eddels) in KwaZulu-Natal and the Southern Cape Regional Footwear
Cluster (Watsons).
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Industrial Development
SG 1: Facilitate transformation of the economy to promote industrial
development, investment, competitiveness and employment creation
 The SEZ Bill was passed by both the National Assembly and the
National Council of Provinces (NCOP). The Bill (which has now become
law since May 2014) will enable the creation of new industrial hubs and
bring previously marginalised regions into the mainstream of the
national economy.
Key Achievements
 A new IDZ was designated at Saldanha Bay in October 2013.
 Pre-feasibility studies have been completed for Tubatse in Limpopo
and Upington in Northern Cape, while others are being finalised for
Bojanala (North West), Maluti-a-Phofung (Free State), Musina
(Limpopo) and Nkomazi (Mpumalanga).
 Applications for designation have been submitted to the Manufacturing
Development Board in respect of Dube Trade Port (KwaZulu-Natal).
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Overview of Incentive Schemes
Actual
Number of firms/projects
supported
Manufacturing Investment Incentives
Description
Potential jobs
supported
Total disbursement
R’000
R1 137 620
Enterprise Investment
Programme (EIP)Manufacturing Investment
Programme (MIP)
EIP- Aquaculture Development
and Enhancement Programme
(ADEP)
Automotive Investment
Scheme (AIS)
12I Tax Allowance Incentive
374
11 734
20
574
36
1 121
13
2 681
Critical Infrastructure
Programme (CIP)
Manufacturing
Competitiveness Enhancement
Programme (MCEP)
Services Investment Incentives
08
4 262
R 139 968
365
106 559
R 991 444
09
2 514
R 278 495
83
-
R 276 505
Business Process Services
(BPS)
Film & Television
R 817 838
20
Provincial Spread: Broadening Participation Incentives
North West:
BBSDP: 32
CIS: 10
EIP: 12
ISP: R 1
Gauteng:
Limpopo:
BBSDP: 339
CIS: 48
EIP: 128
ISP: 7
BBSDP: 208
CIS: 74
EIP: 20
ISP: 3
Mpumalanga:
BBSDP:54
CIS: 6
EIP: 12
ISP: 4
Northern Cape:
BBSDP: 6
CIS: 10
EIP: 0
ISP: R 3
Kwa Zulu Natal:
BBSDP: 221
CIS: 15
EIP: 0
ISP:1
Free State:
BBSDP: 23
CIS: 7
EIP: 8
ISP: 2
Western Cape:
BBSDP: 53
CIS: 11
EIP: 80
ISP: 7
Eastern Cape:
BBSDP: 130
CIS: 62
EIP: 38
ISP: 0
21
Provincial Spread: Manufacturing Incentives
North West:
12I: 0
AIS: 1
CIP: 0
ADEP 1
Gauteng:
Limpopo:
12I: 2
AIS: 4 incl 1 P-AIS
CIP: 5
ADEP 2
12I: 0
AIS: 0
CIP: 2
ADEP 2
Mpumalanga:
12I: 1
AIS: 0
CIP: 0
ADEP 1
Northern Cape:
12I: 0
AIS: 0
CIP 1
ADEP 0
Kwa Zulu Natal:
12I: 3
AIS: 8 incl 1 P-AIS
CIP 0
ADEP 1
Free State:
12I: 0
AIS: 0
CIP 0
ADEP 0
Western Cape:
12I: 2
AIS: 1
CIP: 0
ADEP 11
Eastern Cape:
12I: 5
AIS: 24
CIP: 0
ADEP 2
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MCEP Provincial Performance: 2012/13 & 2013/14
LIMPOPO
2012/13:
3 Approvals (2%)
R11.2 m (1%)
2013/14:
4 Approvals (1.1%)
R 7.3 m (0.3%)
NORTH WEST
2012/13:
1 Approval (0.5%)
R4.5 m (0.5%)
2013/14:
6 Approvals (1.6%)
R35.3 m (1.3%)
NORTHERN CAPE
2012/13:
1 Approval (0.5%)
R 5.5 m (0.5%)
2013/14:
2 Approvals (0.5%)
R5.7 m (0.2%)
WESTERN CAPE
2012/13:
66 Approvals (37%)
R363 m (36%)
2013/14:
106 Approvals (29%)
R497.8 m (17.5%)
FREE STATE
2012/13:
2 Approvals (1%)
R1.6 m (1%)
2013/14:
15 Approvals (4.1%)
R63.1 m (2.3%)
GAUTENG
2012/13:
73 Approvals (37%)
R431.5 m (44%)
2013/14:
139 Approvals (38.1%)
R1.7 b (63.3%)
MPUMALANGA
2012/13:
5 Approvals (3%)
R14.9 m (2%)
2013/14:
7 Approvals (2%)
R25.9 m (0.9%)
KWAZULU-NATAL
2012/13:
29 Approvals (14%)
R81.9 m (8%)
2013/14:
54 Approvals (14.8%)
R301.7 m (10.6%)
EASTERN CAPE
2012/13:
17 Approvals (8%)
R70.6 m (7%)
2013/14:
32 Approvals (8.8%)
R101.1 m (3.6%)
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Overview of Incentive
Schemes
Description
Actual
Number of firms/projects
supported
Total disbursement
R’000
243
R 75 480
1 066
R 291 493
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Paid from EIP budget
1 835
R 273 818
Broadening Participation
Co-operatives Incentive Scheme
(CIS)
Black Business Supplier Development
Programme (BBSDP)
New Incubation Support Programme
(ISP)
Trade, Investment & Exports
Export, Marketing and Investment
Assistance
(EMIA)
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BBSDP Applications Approved in 2013/14 per province
25
CIS Applications Approved In 2013/14
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CPFP Assistance Across Countries For 2013-14
Guinea
•Iron Ore Mine
•Bel Air
Bauxite Mine
Senegal
•Railway
Development
Ethiopia
•Development of
the Beef
Abattoir
Cameroon
•Development
of the Student
Housing
Sierra Leone
•Marampa Iron
Ore Mine
•Marampa
Renewable
energy
Ghana
•Housing
Development
•Sugar Cane
Fields
Development
Namibia
•Logistics Activity
Precinct
•Omitiomire Oxide
Project
Tanzania
•20 000
Housing
Development
•East Africa
Dry Port
Malawi
•Solid Waste
to Energy
project
Mozambique
•Mineral Sand
Deposits
•Picoco III
Housing
Development
•Alluvial Gold
Mine
Angola
•Development
of the Hotel
Chain
Zambia
•Chingola Railway
Line
•Ndola Gold project
•Solid waste to
Energy project
Zimbabwe
•Establishment
of the
Dark Fibre
Infrastructure
•Development of
the Musami Dam
project
Burundi
•Mule
Hydropower
development
•Jiji
Hydropower
Development
Madagascar
•Molo
Graphite
Mine
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EMIA Provincial Performance: 2012/13 & 2013/14
LIMPOPO
2012/13:
6 Approvals (1%)
R436 516 (1%)
NORTHERN CAPE
2012/13:
0 approvals (0%)
R0 (0%)
2013/14:
0 Approvals (0%)
R0 (0%)
WESTERN CAPE
2012/13:
373 approvals (37%)
R23 253 853 (33%)
2013/14:
318 Approvals (31%)
R21 602 258 (27%)
2013/14;
6 Approvals (1%)
R379 316 (1%)
NORTH WEST
2012/13:
13 approvals (1%)
R832 003 (1%)
GAUTENG
2012/13:
488 Approvals (47%)
R35 630 177 (50%)
MPUMALANGA
2012/13:
40 Approvals (4%)
R3 275 095 (5%)
2013/14:
9 Approvals (1%)
R829 654 (1%)
2013/14:
526 Approvals (51%)
R42 152 950 (54%)
2013/14:
50 Approvals (5%)
R4 832 511 (6%)
FREE STATE
2012/2013:
5 Approvals (1%)
R192 142 (1%)
2013/14:
6 Approvals (1%)
R322 384 (1%)
KWAZULU-NATAL
2012/2013:
67 approvals (7%)
R4 279 120 (6%)
2013/14:
74 Approvals (7%)
R5 011 653 (7%)
EASTERN CAPE
2012/2013:
26 approvals (2%)
R1 982 895 (3%)
2013/14:
28 Approvals (3%)
R2 004 402 (3%)
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BPS & FILM Achievements 2013/14
Investment: R 13,2m
Incentive: R 18,667
Jobs: 93
Investment: R 325m
Incentive: R 8,4m
Jobs: 750
Investment: R2,633m
Incentive: R72,000
Jobs: 285
Investment: R 66,723m
Incentive: R 4,952m
Jobs: 788
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Trade, Investment and Exports
SG 2: Build mutually beneficial regional & global relations to advance
South Africa’s trade, industrial policy & economic development
objective
Southern African Development Community (SADC)
• SADC Services negotiations: submitted South Africa’s initial offers on
financial and communication services.
• Agreement reached at Cabinet’s International Cooperation, Trade and
Security Cluster (ICTS) Director-General level to submit a cabinet
memorandum to take steps to encourage compliance by certain SADC
Members of their commitments under the SADC Trade Protocol.
30
Trade, Investment and Exports
SG 2: Build mutually beneficial regional & global relations to advance
South Africa’s trade, industrial policy & economic development
objective
Southern African Customs Union (SACU)
• Consensus reached on the need for high level bilateral engagement in
SACU towards effective implementation of a development integration
approach in SACU.
• Cabinet memorandum on options for South Africa in SACU was discussed
at Cabinet.
• Unified engagement by SACU in its trade negotiations with third parties
e.g. Economic Partnership Agreement (EPA), Tripartite Free Trade
Agreement (T-FTA).
31
Trade, Investment and Exports
SG 2: Build mutually beneficial regional & global relations to advance
South Africa’s trade, industrial policy & economic development
objective
Tripartite Free Trade Agreement (T-FTA) negotiations
• Agreement reached on the scope and coverage of the Phase 1
negotiations.
• Progress made in the tariff negotiations (Consultations within SACU on
tariff offers to the East African Community (EAC) & Egypt at an
advanced stage)
• Good progress made on the negotiations on the text:
• successful conclusion of the non-tariff barrier (NTB) and technical
barriers to trade (TBT) provisions that contain over 90% of South
Africa’s inputs;
• Agreement to re-open negotiation on trade facilitation related
annexes in light of the World Trade Organisation tripartite agreement
32
Trade, Investment and Exports
SG 2: Build mutually beneficial regional & global relations to advance
South Africa’s trade, industrial policy & economic development
objective
African Union (AU)/ New Partnership for Africa’s Development
(NEPAD)
• Guidelines of Good Business Practice approved by the ICTS DirectorsGeneral Cluster of Cabinet.
• Hosting of Africa-India Trade Ministerial Conference.
• Influenced Africa Partnerships to promote support for the development
integration agenda in Africa.
 Tabled three memoranda of understanding (MoUs) on Economic
Cooperation (Ghana, Benin and Nigeria) before Parliament.
 Finalised draft MoU on Automotive Cooperation between SA and Nigeria.
Draft text exchanged through diplomatic channels.
33
Trade, Investment and Exports
SG 2: Build mutually beneficial regional & global relations to advance
SA’s trade, industrial policy & economic development objective
 Engaged in 32 Business and/or Technical missions to promote economic
cooperation.
 Participated in 81 government to government platforms.
 Conclusion and implementation of the South Africa- Cuba agreement on
economic assistance.
 Completion of the South Africa- Japan Joint Study on Economic
Cooperation.
 Continued lobbying for extension of South Africa’s inclusion in the African
Growth Opportunity Act (AGOA).
 Conclusion of the WTO Bali Package which included an agreement on
Trade Facilitation
 Drafted responses and made a presentation at a public hearing of
Australia’s safeguard investigation on canned fruits.
34
Trade, Investment and Exports
SG 2: Build mutually beneficial regional & global relations to advance
South Africa’s trade, industrial policy & economic development
objective
 Facilitated exports of R 3. 4 billion
 1 000 companies were trained on the Global Exporter Passport
Initiative to enhance their export readiness.
 Obtained third position for the best stand in Mozambique (FACIM) in
August 2013.
 Made inputs to the review of International Trade Administration
Commission’s (ITAC) Anti-Dumping and Countervailing Regulations.
 Terminated the European Union (EU) bi-lateral investment treaty (BIT).
 Published the draft Promotion and Protection of Investment Bill for public
comment.
35
Trade, Investment and Exports
SG 2: Build mutually beneficial regional & global relations to advance
South Africa’s trade, industrial policy & economic development
objective
 Investment Pipeline of R 60.5 bn with a potential of creating 34 560 jobs
 Major projects in manufacturing, mining and green economy. Total
investment attracted into the green industries sector amounted to
approximately R10 billion.
 Multinationals have affirmed South Africa as a hub and a Gateway into
the continent with new investments and expansions in the manufacturing
sector. These include Unilever, Proctor & Gamble, Nestle, Samsung,
Hisense FAW, IVECO amongst others.
 Domestic companies such as Aspen, MPACT, Amka, Gibela Rail have
expanded or added new investment.
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AIS & 12I achievements 2013/14
Mercedes Benz SA
InvestmentL R5,4bn
Incentive: R1,6bn
Jobs: 254
Johnson Controls Automotive South Africa (Pty)
Ltd - W205 C-Class Mercedes Interior Project
Investment: R 301m
Incentive: R 90,4m
Jobs: 73
Investment: R257,6m
Incentive: R64,4m
Jobs: 190
Investment: R 569m
Allowance: R 202m
Investment: R1b
Allowance: R 496m
Jobs: 1112
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Broadening Participation
SG 3: Facilitate broad-based economic participation
targeted interventions to achieve more inclusive growth
 The Broad-Based Black Economic Empowerment
Amendment Act, 2013 assented to by the President.
through
(B-BBEE)
 The B-BBEE Codes of Good Practice were approved by the Minister
and published for implementation in 2015.
 Through the seda Technology Programme (stp) – 432 new Small
Medium Micro Enterprises (SMMEs) were created and 1 587 SMMEs
supported. Currently, 42 incubators countrywide support SMMEs in
various industrial sectors (including chemical, biotechnology,
floriculture, small-scale mining, ICT, stainless steel, furniture,
construction, jewellery, bio-fuels, agriculture, automotives, base metals,
mixed manufacturing and aluminium.)
 The National Informal Business Upliftment Strategy (NIBUS) was
approved by Cabinet and launched by the Minister in March 2014.
38
Broadening Participation
SG 3: Facilitate broad-based economic participation through targeted
interventions to achieve more inclusive growth
 The Co-operatives Amendment Act, 2013 was assented to by the
President in August 2013 and provides for the Co-operative Development
Agency (CDA), with its primary role being to provide support with the
development and capacity building of co-operatives as well as the Cooperatives Tribunal to look at resolving disputes.
 The Integrated SMMEs and Co-operative Development Framework
and Action Plan have been approved by MinMec and the Minister.
Phased implementation of the Action Plan is in progress.
 The Isivande Women’s Fund (IWF) supported 16 projects.
 Supported 322 companies participating in the Workplace Challenge
Programme (WCP)
 Revised the draft National Strategic Framework on Gender and Women
Empowerment.
 Youth Enterprise Development Strategy (YEDS) approved and launched
by Minister in November 2013.
39
Regulation
SG4: Create a fair regulatory environment that enables investment,
trade and enterprise development in an equitable and socially
responsible manner
 The Lotteries Amendment Act and the Intellectual Laws Property
Amendment Act for the Protection of Traditional Knowledge were
assented to by the President.
 The National Credit Amendment Bill was adopted by both Houses of
Parliament.
 Developed Draft Policy Frameworks on Intellectual Property and
Gambling
 Policy Framework and Bill for Licensing of Businesses developed
and public consultations conducted.
 An Impact Assessment Study on the Liquor Act, 2003 and draft Policy
were developed and the results were incorporated in the draft liquor
policy.
40
Administration
SG5: Promote a professional, ethical, dynamic and competitive and
customer – focused working environment that ensures effective and
efficient services delivery
 The vacancy rate was at 9.4% with an employee retention rate of
93.2% (the cumulative turnover stood at 6.8% in respect of permanent
employees).
 The department recorded 44% of women employed in Senior
Management Service (SMS) positions and 2.7% people with a disability.
 Payment of all eligible creditors made well within 30 days.
 Received an award in 2013 as the “Top performing government
department” at the eleventh Annual National Business Awards organised
by the private sector. Also received an acknowledgment as the second
best functioning national department in 2012, according to the
Management Performance Assessment Tool (MPAT) conducted by the
Presidency’s DPME last year
41
Summary of achievement of targets for 2013/14 FY
Strategic Goal
Total APP target per
strategic objective
Achieved
Not Achieved
SG 1
33
28 (85%)
5 ( 15%)
SG 2
4
4 (100%)
0
SG 3
23
19 (83%)
4 (17%)
SG 4
4
3 (75%)
1 (25%)
SG 5
11
9 (82%)
2 (18%)
TOTAL
75
63 (84%)
12 (16%)
Targets not achieved include partially achieved targets.
Significant progress has been made on all partially achieved targets.
42
Financial management
43
Overview of the expenditure for the 2013/14 financial year
The expenditure based on the final appropriation of R9,516 billion is 98.6% or R9,380 billion, implying an under-spending
of R135 million (1.4%)
Overview of expenditure per programme:
Programme
Administration
Final
Appropriation
R’000
724 139
Actual
Expenditure
700 370
R’000
23 769
Expenditure as
a % of Final
Appropriation
%
96.7%
R’000
(Over)/Under
Expenditure
ITED
146 339
139 566
6 773
95.4%
BPD
1 006 282
999 833
6 449
99.4%
IDPD
1 590 453
1 575 586
14 867
99.1%
CCRD
258 146
256 698
1 448
99.4%
IDIAD
5 440 720
5 361 292
79 428
98.5%
349 501
346 951
2 550
99.3%
9 515 580
9 380 296
135 284
98.6%
TISA
Total
44
Overview of the expenditure for the 2013/14 financial year
Overview of expenditure per economic classification:
Economic Classification
Final
Appropriation
R'000
Current payments
Compensation of employees
Goods and services
Transfers and subsidies
Departmental agencies and accounts
Higher education institutions
Foreign governments and international
organisations
Public corporations and private enterprises
Non-profit institutions
Households
Gifts and donations
Payment for capital assets
Machinery and equipment
Intangible assets
Payment for financial assets
TOTAL
Expenditure
as % of final
appropriation
Actual
Expenditure
Variance
R'000
R'000
%
799 139
718 808
789 346
690 354
9 793
28 454
98.8%
96.0%
1 288 722
1 287 727
995
99.9%
12 834
12 830
4
99.9%
38 874
6 583 109
27 885
4 222
807
37 572
6 511 248
26 885
3 955
559
1 302
71 861
1 000
267
248
96.7%
98.9%
96.4%
93.7%
69.3%
15 913
24 048
12 041
6 615
3 872
17 433
75.7%
27.5%
1 219
1 164
55
95.5%
9 515 580
9 380 296
135 284
98.6%
45
Audit outcome for 2013/14
Financial Year and
interventions to address
the Auditor-General’s
findings
46
Audit outcomes
the dti has received a financially unqualified audit opinion from the Auditor-General South Africa (AGSA) for the
2013/14 financial year,
Audit outcomes
HR Management
Procurement
Management
Expenditure
management
Asset management
Findings on areas of non-compliance
Annual financial
statements
Reported
information not
reliable
Findings on predetermined
objectives
Reported
information not
useful
Audit opinion
Financial year
Fincial
statements
13/14
12/13
11/12
10/11
No findings
Legend
Findings
47
Interventions to address AGSA’s Audit Findings
Finding
Management interventions
The accounting officer did not take steps
to prevent irregular expenditure.
These relate to transactions where three quotations could not be obtained. The
following additional measures was implemented:
• Clear communication via financial circulars on the procurement requirements
of transactions less than R500,000 have been implemented.
• Targeted training interventions with procurement staff and divisional advisors
on the department’s procurement policies and procedures and SCM
legislation was implemented.
• An information session on irregular expenditure was presented by National
Treasury on 28 October 2013
• An easy to follow guide was also distributed during December 2013 to assist
staff with the procurement procedure to be followed in order to prevent
irregular expenditure
• Irregular expenditure transactions are analysed per Division and memoranda
were issued on a quarterly basis to the relevant managers to take appropriate
action against staff that permits irregular expenditure.
• Based on the implemented additional controls irregular expenditure reduced
from R32 966 million in 2012/13 to R6 376 million in 2013/14.
48
Challenges
 Poorer manufacturing performance due to slow global growth and
strikes in the mining industry
 Industrial sectors supported by dti incentives show growth, while other
sectors like plastics, steel and metal fabrication lagging
 Credit fuelled consumption driven demand is running out of steam
 Electricity and water supply shutdowns impacted on manufacturing
 Sharply escalating administered prices where municipal premiums and
pricing anomalies within and in between municipalities
 Higher rail freight and port charges
 Need to build partnerships between government and business to
secure much greater progress in upstream mining supply chains and
downstream beneficiation
49
Ke ya leboga
Ke a leboha
Ke a leboga
Ngiyabonga
Ndiyabulela
Ngiyathokoza
Ngiyabonga
Inkomu
Ndi khou livhuha
Dankie
Thank you