Economic Development 1st and 2nd quarterly report

Presentation to the Portfolio Committee

12 October 2010

Presentation outline

• Minister, Deputy Minister and DG engagements• Recruitment• Growth Path• Policy issues• Economic MinMec• Outcome 4• Green economy• Spatial planning • Social dialogue• Economic Advisory Panel• Agency oversight• ENE targets• Concluding remarks

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Minister’s engagements

• Consultations on the new Growth Path• Cabinet and Cabinet Committees • Economic Ministerial Cluster meetings• Meetings of Presidential Councils on BBBEE and HRD• Meetings of Inter-Ministerial Committee on Energy and

other IMCs including Anti-poverty, PBMR, NHI• IPAP monthly meetings• Engagements with Portfolio and Select Committees• Engagements with Social Partners including Leadership

Team meetings and bilaterals• Engagements with ILO, UNDP and IMF • Engagements with EDD agencies• Engagements with Economic Development MECs• International relations including State visit to China

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State visit to China• The Beijing Declaration noted the need for SA and China to –

– Improve the structure of trade between the two countries, in particular by working towards a more balanced trade profile and encouraging trade in value-added products

– Encourage China’s enterprises to increase investment in South Africa’s manufacturing industry and beneficiation at source is to be facilitated

– Actively support key sectors including the green economy and agro-processing

– Cooperate and provide mutual technical support in the areas of the green economy, skills development and industrial financing. In relation to industrial financing, both sides would work to find ways to strengthen the participation of their capital markets in funding for industrial development at concessionary rates in order to promote sustainable development

• The Minister met with the China Africa Development Fund and China Development Bank regarding the establishment of a Green Fund and Agro-processing Fund through the IDC

• The Minister took initial steps towards holding a workshop for South African and Chinese green economy entrepreneurs and businesspeople

Deputy Minister’sengagements• Crans Montana Forum – Brussels (7-10 April)• 6 provincial visits (Gauteng, NW, Limpopo,

Mpumalanga, KZN, Free State)• Engagements on local economic development• Engagements on cooperative development• Community engagements• Cabinet and Cabinet Committee meetings• Meetings of the Nedlac Executive Council

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DG’s engagements

• Implementation of the Recruitment Plan• Implementation of the Strategic Plan• Management of the budget, finances, human resources

and accommodation• Oversight of planning and reporting• Economic cluster meetings• Growth path consultations • Engagements with all agencies and discussions on

corporate governance at samaf and Khula• Technical MinMec• Engagements with provincial Economic Development

HODs on key provincial projects

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EDD on 1 April 2010

• Minister– Ministry (7 staff)

• Deputy Minister– Office of the Deputy Minister (5)

• Director-General– Office of the DG (3)

• Corporate services (0)

• Line function staff (3 – contract)7

Recruitment 1st quarter

• Implementation of the recruitment plan– Shortlisting for 4 DDG posts– Shortlisting for 4 CD posts– Shortlisting for 3 corporate manager posts– Project assignments (take-home and exam) and

competency tests– Interviews held on 17 May, 12&27 May, 18&27 May, 2

June, 3 June, 7 June, 8 June and 28 June– Cabinet approval for DDG appointments 15 June and

22 July– Shortlisting of Senior Economist & Policy Analyst and

Senior Statistician

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Recruitment 2nd quarter• Key positions filled:

– DDG: Economic Policy Development– DDG: Economic Planning and Coordination– CFO, CD: HR, CD: Planning, CD: Growth Path

• Total of 23 appointments in second quarter

• Recruitment and selection processes– 23 jobs job-evaluated (56 posts)– Challenges in identifying appropriately skilled candidates in cases– D: Internal Audit and D: Legal Services underway

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Growth Path• Various officials assisted the Minister with aspects of the Growth

Path document

• Delegations to partner departments for inputs on the relevant chapters

• Discussion papers on key themes developed

• Presentations on the Growth Path at Economic DG Cluster, Economic Ministerial Cluster, MinMec and COTII

• Presentation to July Cabinet Lekgotla

• Engagements at Ministerial and DG Cluster meetings

• To be finalised at Cabinet level10

Policy issues

• Second economy– Research has commenced on: a strategy to reduce

youth unemployment; the mainstreaming of second economy activities; and a cooperatives strategy

– Engagements held with National Treasury, the dti and other key partners

• Integrated Resource Plan (Electricity)

• Kumba/AMSA

• Massmart/Walmart11

Economic Development MinMec• MinMec held on 24 June 2010

– Ministers of EDD and the dti– MPs, 8 MECs and 3 metro mayors and executive

heads of agencies attended– Presentations on the Growth Path and IPAP by the

Ministers– Presentations on provincial projects aligned to the

Growth Path and on Outcome 4• Technical MinMec (HODs’ meeting) met on 6

August and 13 September– Preparation for MinMec to be held on 14 October– Presentations on the Green Economy, Consumer

Protection Act, preferential procurement and functioning of MinMec

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Outcome 4• Cabinet adopted outcomes-based monitoring and evaluation system

in January

• Outcome 4 is “Decent employment through Inclusive Growth”

• Economic Sectors and Employment Cluster is the Implementation Forum for Outcome 4

• Delivery Agreement and Plan of Action for Outcome 4 has been drafted

• Economic Development MinMec coordinates implementation across the spheres of government

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Green economy

• Developed an advert to obtain information for a public database

• Meeting with stakeholders to develop a policy framework for the Green Economy

• Participated in interdepartmental work on:

– Rollout of solar water heating– Concentrated Solar Thermal– Establishment of a Solar Park in the Northern Cape– Developing sector strategies for labour-intensive sectors in

renewable energy

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Spatial planning

• Engaging dti, COGTA, DRDLR and NPC to assist in coordinating the identification of and support to distressed regions

• Developing an economic spatial perspective for the country

• Meetings with the E Cape to unblock some of the obstacles they are facing in the implementation of strategic economic projects

• Participated in the Presidency’s Anti-poverty visits to Lubala in the Eastern Cape and Bitou Municipality in the Western Cape (engaged IDC and samaf)

• Engaged with Working for Water regarding location of a public employment scheme in Balfour Municipality

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Social dialogue (1)

• Leadership Team on the Framework Agreement met on 26 April and 2 July

• Key progress 1st and 2nd quarters

1. IDC distress funding2. UIF funding3. Training Layoff Scheme4. Clothing and Textile Competitiveness Improvement

Programme5. Production incentive

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1. IDC distress funding

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Period Value committed (Rb)

Jobs to be created and saved

Cost per job (R’000)

No. of companies

Q1 and Q2 (2010/11)

1,265 3,715 340 12

Total to date 2,922 17,883 163 53

2. UIF funding

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Period Value committed (Rm)

Jobs to be created and saved

Cost per job (R’000)

No. of companies

Q1 and Q2 (2010/11)

104 736 142 12

3. Training layoff

• As of 30 September 2010:

– No. of workers: 5532• Completed training 1182• Training in progress 4350

• Applications in process 855

– No. of companies: 2119

4. CTCIP

• Applications received: R92 427 728.53

• Approvals: R92 427 728.53

• No. of companies: 99

• Most companies have signed contracts and funds will be transferred from October 2010

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5. Production incentive

• Applications: R409 650 731

• No. of companies 76

• Approvals: R 60 174 064

• No. of companies: 20

• Contracts being processed. No transfers made as yet.

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Social dialogue (2)• Participated in Presidency’s delegation for meeting with BUSA on 13 July

• Workshops held in regions – Cape Town, Durban and Johannesburg (clothing and textiles)– Port Elizabeth (automotive components)

• Discussions with Ford, Cam Clothing, Aspen and pharmaceutical firms

• Workplace agreement finalised at Cam Clothing and 2 more under negotiation

• Workshop held on preferential procurement with AMSA, SACTWU and ILO

• Engagements regarding the implementation of the Framework Agreement– Companies in distress, Banking Association, CCMA and DoL– The rules have now been changed to make access to the Training Layoff

Scheme easier for companies experiencing a downturn– The IDC/CCMA made 15 presentations on distressed funding and Training

Layoff

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Social dialogue (3)

• 2nd Next Economy National Dialogue– Held on 19 July– Focused on the Economic lessons from the

Soccer World Cup– Speakers: Danny Jordaan, Dr Nkosazana

Zuma and Goolam Ballim

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Economic Advisory Panel• First meeting held on 25 May in Cape Town• Presentations included –

– New Growth Path– South Africa – sustaining the revival– IPAP2– The world economy today and tomorrow– Industry status

• 2nd meeting held with President Zuma on 14 July at the Union Buildings– Provided an update on the Growth Path– Meeting with the President

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Agency oversight (1)

• The Minister has engaged with the agencies reporting to Economic Development

• On 4 June briefed heads of agency on the new Growth Path

• Set out expectations for agencies in relation to key areas including –

– Review of priorities against Growth Path and IPAP priorities– Review of Strategic Plans and MTEF proposals– Addressing red tape, costs and turnaround times– Policy issues including the green economy, youth employment

and cooperatives strategy– Spatial development issues

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Agency oversight (2)

• On 4 June the Minister also set out key oversight criteria to be reflected in a dashboard of indicators for agencies

• Dashboard has subsequently been drafted and workshopped with agencies

• Minister has engaged with agencies on a number of issues including:– Developmental objectives of the IDC– Spatial planning and support by the IDC– Green economy with the IDC– Khula Direct model– Competition policy– MTEF Budget of Competition Commission– Micro-finance model for Samaf

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Agency oversight (3)• Strategic plans

– June-July DG engaged with each agency on the detail of their strategic plans

– Strategic Plans and were tabled on 6 August / 11 August

– DG wrote to Chair of Portfolio Committee regarding the Strategic Plans

– Committee has engaged with agencies on their plans

• Annual reports

– EDD and agencies’ Annual Reports tabled on 30 September

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Concluding remarks• Successful staff recruitment will be key to EDD’s progress

• Recruitment is a priority but compliance with Regulations is time-consuming

• One area of major focus has been the new Growth Path

• Work in Economic Cluster has produced a Delivery Agreement for Outcome 4

• Related to this is intergovernmental cooperation and coordination of Output 4 in the Economic Development MinMec

• Oversight of agencies a key focus

• EDD on track in most instances to achieving the ENE targets set

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Siyabonga