2018 free state economic small business development

VOTE NO. 3

ANNUAL REPORT2017/18 FINANCIAL YEAR

DEPARTMENT OF ECONOMIC, SMALL BUSINESS DEVELOPMENT, TOURISM AND ENVIRONMENTAL AFFAIRS

FREE STATE PROVINCE

Free State Departm

ent of Economic, Sm

all Business Developm

ent, Tourism and Environm

ental Aff

airs Annual Report 2017/ 2018

Free State Department of Economic, Small Business Development, Tourism and

Environmental Affairs Annual Report 2017/ 2018

Physical: 113 St Andrew Street, Bloemfontein, 9300

Postal: P.O. Box X20801, Bloemfontein, 9300

Tel: (051) 400 9542Email: [email protected]

Website: www.detea.fs.gov.za

PR305/2018ISBN: 978-0-621-46603-4

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VOTE NO. 3


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Contents

PART A: GENERAL INFORMATION 4

1. DEPARTMENT GENERAL INFORMATION 5

2. LIST OF ABBREVIATIONS/ACRONYMS 6

3. FOREWORD BY THE MEC 8

4. REPORT OF THE ACCOUNTING OFFICER 10

5. STATEMENT OF RESPONSIBILITY AND CONFIRMATION OF ACCURACY FOR THE ANNUAL REPORT 15

6. STRATEGIC OVERVIEW 16

6.1. Vision 16

6.2. Mission 16

6.3. Values 16

7. LEGISLATIVE AND OTHER MANDATES 16

8. ORGANISATIONAL STRUCTURE 20

9. ENTITIES REPORTING TO THE MEC 21

PART B: PERFORMANCE INFORMATION 22

1. AUDITOR GENERAL’S REPORT: PREDETERMINED OBJECTIVES 23

2. OVERVIEW OF DEPARTMENTAL PERFORMANCE 23

2.1 Service Delivery Environment 23

2.2 Service Delivery Improvement Plan 36

2.3 Organisational environment 38

2.4 Key policy developments and legislative changes 40

3. STRATEGIC OUTCOME ORIENTED GOALS 41

4. PERFORMANCE INFORMATION BY PROGRAMME 43

4.1 Programme 1: Administration 43

4.2 Programme 2: Environmental Affairs 564.3 Programme 3: Economic and Small Business Development 63

4.4 Programme 4: Tourism Development 69

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5. TRANSFER PAYMENTS 74

5.1. Transfer payments to public entities 74

5.2. Transfer payments to all organisations other than public entities 75

6. CONDITIONAL GRANTS 76

6.1. Conditional grants and earmarked funds paid 76

6.2. Conditional grants and earmarked funds received 77

7. DONOR FUNDS 78

7.1. Donor Funds Received 78

8. CAPITAL INVESTMENT 78

8.1. Capital investment, maintenance and asset management plan 78

PART C: GOVERNANCE 81

1. INTRODUCTION 82

2. RISK MANAGEMENT 82

3. FRAUD AND CORRUPTION 82

4. MINIMISING CONFLICT OF INTEREST 83

5. CODE OF CONDUCT 83

6. HEALTH SAFETY AND ENVIRONMENTAL ISSUES 84

7. PORTFOLIO COMMITTEES 86

8. SCOPA RESOLUTIONS 86

9. PRIOR MODIFICATIONS TO AUDIT REPORTS 87

10. INTERNAL CONTROL UNIT 87

11. INTERNAL AUDIT AND AUDIT COMMITTEES 88

12. AUDIT COMMITTEE REPORT 89

PART D: HUMAN RESOURCE MANAGEMENT 92

1. INTRODUCTION 93

2. OVERVIEW OF HUMAN RESOURCES 93

3. HUMAN RESOURCES OVERSIGHT STATISTICS 97

PART E: FINANCIAL INFORMATION 129

1. REPORT OF THE AUDITOR GENERAL 130

2. ANNUAL FINANCIAL STATEMENTS 140

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PART A: GENERAL INFORMATION

PART A: GENERAL INFORMATION

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1. DEPARTMENT GENERAL INFORMATION

PHYSICAL ADDRESS: 113 St Andrews Street

Bloemfontein

9300

POSTAL ADDRESS: Private Bag X20801

Bloemfontein

9300

TELEPHONE NUMBER/S: 051 400 9542

EMAIL ADDRESS: [email protected]

WEBSITE ADDRESS : www.detea.fs.gov.za

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2. LIST OF ABBREVIATIONS/ACRONYMS

Acronyms Description

AIDS AcquiredImmuneDeficiencySyndrome

AMKPI Asset Management Key Performance Indicator

APP Annual Performance Plan

AQMP Air Quality Management Plan

BAS Basic Accounting System

BBBEE Broad Based Black Economic Empowerment

CCCU Central Communication Coordinating Unit

DCC Departmental Consultative Committee

DESTEA Department of Economic, Small Business Development, Tourism and Environmental Affairs

DM District Municipality

DMP Demand Management Plan

EIA Environmental Impact Assessment

EIP Environmental Implementation Plan

EHWP Employee Health and Wellness Programme

EMC Environmental Management Committee

EPWP Expanded Public Works Programme

ETEYA Emerging Tourism Entrepreneur of the Year Awards

EXCO Executive Council

FDC Free State Development Corporation

FS Free State

FSGDS Free State Growth and Development Strategy

GDP Gross Domestic Product

GIAMA Government Immovable Asset Management Act

HIV HumanImmuneDeficiencyVirus

HOD Head of Department

HR Human Resource

ICT Information Communication Technology

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IDP Integrated Development Plan

IEMFFS Integrated Environmental Management Framework of Free State

ITC Information Technology and Communication

IWMP Integrated Waste Management Plan

LED Local Economic Development

MEC Member of the Executive Council

MSP Master Systems Plan

MTSF Medium-Term Strategic Framework

MTEF Medium-Term Expenditure Framework

NEMA National Environmental Management Act

NSSD National Strategy on Sustainable Development

PA Protected Area

PP Procurement Plan

PMDS Performance Management Development System

PFMA Public Finance Management Act

PGDS Provincial Growth and Development Strategy

PMG Pay Master General

PSBAC Provincial Small Business Advisory Council

RIDS Regional Industrial Development Strategy

SDIP Service Delivery Improvement Plan

SITA State Information Technology Agency

SMME Small, Medium and Micro Enterprise

SMS Senior Management Services

SRI Social Responsibility Initiatives

Stats SA Statistics South Africa

DTI Department of Trade and Industry

UAMP User Asset Management Plan

VCCT VoluntaryandConfidentialCounsellingandTesting

WIS Waste Information System

LOGIS Logistics Information System

CSD Central Supplier Database

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3. FOREWORD BY THE MEC

During its 54th National Conference in December 2017, the ruling Party, the ANC, resolved to have met under the theme of “Remember Tambo: Towards Unity, Renewal and Radical Socio-economic Transformation”. The ANC further emphasized that the purpose of the Conference was “to remind ourselvesofComradeOR’slegacyofselflessservicetohispeopleandourdutytoemulatehiminworking for the unity and renewal of our organization”.

The above has also been our driving force as the Department, consorting to the ANC mandate of a united and committed organization to the people’s interests as a best vehicle to bring about fundamental and radical socio-economic transformation of society to create a better life for all South Africans. In executing its Political, Policy and Administrative mandate, the Department has continued in 2017/2018 to deal with the triple challenges that are affecting the lives of Free State Citizens, which are Poverty, Inequality and Unemployment. It is our Vision that by 2020 we should be able to realise a transformed economy and a prosperous society that is living in harmony with its natural resources. When we presented our 2017/2018 Annual Performance Plan, we set ourselves some key milestones that we had to pursue to achieve our mandate and these were:

• Provisionofleadershipforeffectivesocio-economicdevelopment.

• Creationofefficientandeffectivefinancialmanagementsystemforsustainability.

• BuildaresponsiveHumanResourceattributedthatisresponsivetoservicedemands.

• Implicationsofintegratedeconomicdevelopmentforradicaltransformation

• Inculcateaccountableenvironmentalmanagementforsustainabledevelopment&inclusive economic growth.

• FosterTourismsectortransformationanddevelopmentforimprovedmarketshare

• Businessprocessoptimisationforbetterprogrammeperformanceandco-operation.

These were the principles from which the Department operated and yielded positive results in variousrespect.Inthepastfinancialyear,1150directandindirectjobswerecreatedthroughvariousinitiatives aimed at developing and supporting SMMEs in the province. Opportunities have been createdthroughprojectssuchas:

• GreenestandCleanestMunicipalityCompetition

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• UpgradingofResortsandReserves.

• MECsRoadshows.

• InvestSAOne-Stop-Shop

• BlackIndustrialistSupportProgramme

• Maluti-A-PhofungSpecialEconomicZone(MAP-SEZ)

• SMMEFunding

• TabalazaPitchingProgramme

• Economicrevitalizationoftownships

• FlowerFestival

The Department`s intention with these initiatives was to create favourable conditions for businesses to thrive, changing the lives of the people for the better; supporting the statement by the former State President Nelson Mandela when he said, “Let there be work, bread, water and salt for all”.

The Department needs to further enhance and strengthen its efforts to realise its contribution towards RadicalSocio-economicTransformation.ThefiguresreleasedbyStatsSAforemploymentinQuarter1 of 2018/2019 serve as a wake-up call for the Department to intensify its efforts in transforming theeconomy,tourismandenvironmentintheFreeState.StatsSAhasindicatedthatfiveprovinceswhich are the Free State, Gauteng, Western Cape, North West and Mpumalanga experienced quarter-to-quarter(Q1:2018toQ2:2018)increasesintheofficialrateofunemployment.TheFreeState recorded an increase of 1.6 percentage points in the unemployment rate in Q2:2018 compared to Q1:2018. The above statistics are a clarion call that economic development and tourism must be abletostimulatejobcreationintheProvince.

The world is now investing in tourism for economic development and Free State is no different. We are realizing the potential of the tourism industry in changing the lives of ordinary people. More and morepeopleareencouragedtoventureintotheTourismIndustrybyexposingthemtoprojectsandprogrammes like Medical Tourism, Lilizela Tourism Awards, Flower Festival and many others.

Keepingtheenvironmentclean,healthyandsafeisalsoourpriorityinthisfinancialyear.EnvironmentalManagement, especially transformation in the wild life economy is necessary to ensure participation of previously disadvantaged communities and mainstream economy.

_________________

Ms. L.P. Mahasa

MEC: Department of Economic, Small Business Development, Tourism and

Environmental Affairs

31 May 2018

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4. REPORT OF THE ACCOUNTING OFFICER

• Overviewoftheoperationsofthedepartment:

The main focus and mandate of the Department of Economic, Small Business Development, Tourism and Environmental Affairs is to champion economic activities in the Free State in order to ensure that the government programmes make a difference in the lives of our People. Our programmes for the period under review are motivated by the principles of the National Development Plan, the Free State Growth and Development Strategy, the State of the Nation Address, the State of the Province Address and the department’s Budget Vote.

The report contained in this document will outline the operation of the department which focus primarily on:

1. Radical Socio – Economic Transformation

2. Foreign Direct Investment

3. Business Regulation

4. Tourism Development

5. Environmental Management and

6. Effective Governance

The accomplishment of our programme of action primarily depends on co-ordination and alliance with other stakeholders like: National Departments and Provincial Departments, State owned agencies, Municipalities, Institutions of Higher Learning and other associations.

In our effort to improve service delivery to the People of the Free State, focus was placed onadministrativeandfiscaldisciplinewhichincludefillingofcriticalvacantfundedpositionsin the department.

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• Overviewofthefinancialresultsofthedepartment:

o Departmental receipts

Departmental receipts

2016/2017 2017//2018Estimate Actual

Amount Collected

(Over)/UnderCollection

Estimate Actual

Amount Collected

(Over)/Under

Collection

R’000 R’000 R’000 R’000 R’000 R’000Sale of goods and services other than capital assets

25 268 10,428 14 839 21 374 12,218 9 156

Fines, penalties and forfeits

711 30 681 134 393 (259)

Interest, dividends and rent on land

12 28 (15) 12 28 (16)

Financial transactions in assets and liabilities

164 850 (687) 794 1,169 (375)

Total 26 155 11.336 14 818 22 314 13.808 8 506

- The Department submits an annual application for revenue tariffs to the Provincial Treasury after consultation with various managers in the resorts, game reserves and the compliance and law enforcement units. Factors that are taken into consideration include, but are not limited to, the current condition of the resorts and the prices charged in the private sector, as well as any planned renovations for these facilities.

• Salesofgoodsandservices

The Department was unable to collect all the revenue estimated even though the annual gameauctiontookplace.Revenuefromthisactivityisdeemedtobeamajorsourceofincome for the Department and formed 92% of total revenue in 2017/18, because it also includes the sale of game as butchery meat during the culling process.

The Phillip Sanders facility still needs a lot of repairs and maintenance to be fully operational so that the Department can fully derive revenue from the resort.

• Fines,PenaltiesandForfeits

TheDepartmentwasunabletorecoverrevenueformthefineswhichwereissuedasaresultofSection24GoftheNationalEnvironmentalManagementAct(NEMA)becausecompanies that were issued with these penalties have made representations to the Department for leniency through the approach process and the cases have not been finalized.

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• FinancialTransactionsinAssetsandLiabilities

Revenue was raised through the recovery of debts on salaries overpayment, claims from other Departments and telecommunications recovery of overspending. The Department is rolling out the speed points throughout the reserves and resorts so that tourists’ payments can be electronically processed to deal with the risk of theft.

o ProgrammeExpenditure

Programme Name

2016/2017 2017/2018Final

AppropriationActual

Expenditure

(Over)/Under

Expenditure

Final Appropriation

Actual

Expenditure

(Over)/UnderExpenditure

R’000 R’000 R’000 R’000 R’000 R’000

Administration 136,439 134,744 1,695 141,099 141,056 43


146,442 139,488 6,954 136,691 137,858

(1,167)

Economic Development

114,378 113,353 1,025 218,167 201,075 17,092

Tourism 77,737 75,491 2,246 9,191 8,937 254

TOTAL 474,996 463,076 11,920 505,148 488,296 16,222

o Virements/roll overs

Therearenorolloversrequestsforthecurrentfinancialyear.

Virements

Programme Amount (R’000)

Administration 1 100Economic Development 2 982Environmental Affairs (3942)

Tourism (140)Total 0

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• Adescriptionofthereasonsforunauthorised,fruitlessandwastefulexpenditureand the amounts involved as well as steps taken to address and prevent arecurrence:

o The Department incurred unauthorized expenditure on compensation of employees due to provintial budget allocation reductions - year.

• Futureplansofthedepartment:

o Future plans of the Department are to upgrade and market the reserves and resorts in ordertoderivemaximumrevenueforthecontributionintotheProvincialfiscus.

• PublicPrivatePartnerships

o None

• Discontinuedactivities/activitiestobediscontinued

o None

• Neworproposedactivities

o None

• Supplychainmanagement

o There were no unsolicited bid proposals concluded for the year under review. SCM processesandsystemsareinplacetoprevent(and/ordetect)irregularexpenditure.

o The Departmental Supply Chain Management Policy has been reviewed and includes new Regulations

o Lack of automated systems.

• GiftsandDonationsreceivedinkindfromnon-relatedparties

o None

• ExemptionsanddeviationsreceivedfromtheNationalTreasury

o None

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• Appreciation

o I thank the Executive Council of the Province led by the Honorable Premier for their leadership, the MEC for strategic guidance and support, Senior Management of the Department, and staff in general for their support and dedication to serve.

_______________________

DrMNokwequ

ActingAccountingOfficer

Department of Department of Economic, Small Business Development, Tourism and Environmental Affairs

Date: 31 May 2018

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5. STATEMENT OF RESPONSIBILITY AND CONFIRMATION OF ACCURACY FOR THE ANNUAL REPORT

Tothebestofmyknowledgeandbelief,Iconfirmthefollowing:

All information and amounts 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 National Treasury.

TheAnnualFinancialStatements(PartE)havebeenpreparedinaccordancewiththemodifiedcashstandardandtherelevant frameworksandguidelines issuedbythe National Treasury.

TheAccounting Officer is responsible for the preparation of the annual financialstatementsandforthejudgementsmadeinthisinformation.

TheAccountingOfficer isresponsible forestablishing,and implementingasystemof internal control that has been designed to provide reasonable assurance as to the integrity and reliability of the performance information, the human resources informationandtheannualfinancialstatements.

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

In my opinion, the annual report fairly reflects the operations, the performanceinformation, the human resources information and the financial affairs of thedepartmentforthefinancialyearended31March2018.

Yours faithfully

___________________

DrMNokwequ

Acting:AccountingOfficer

Date 31 May 2018

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6. STRATEGIC OVERVIEW

6.1 Vision

“A transformed economy and a prosperous society that is living in harmony with its natural resources”.

6.2 Mission

“To be a leading and developmental institution, that drives economic transformation, environmental sustainability, system change and adaptation to the ever-changing dynamicsforthebenefitoftheFreeState.”

6.3 Values

• TeamWork• Integrity• Accountability

• Passion

7. LEGISLATIVE AND OTHER MANDATES

7.1 CONSTITUTIONAL MANDATE

The DESTEA’s constitutional mandates have been derived from Schedules 4 and 5 of the Constitution of the Republic of South Africa, which requires the Department to oversee and administer the following:

1. Trade and investment promotion.2. Tourism development3. Casinos, racing, gambling and wagering4. Consumer protection 5. Environment and nature conservation6. Promotion of industrialization7. Public entity overnight8. Administration of Liquor licences and control of undertakings that sell liquor to the public9. Small business development

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Furthermore, the Department’s constitutional mandate is derived from Section 24 of the Constitution, which emphasises that, everyone has the right:

a. to an environment that is not harmful to their health or well-being; and

b. tohavetheenvironmentprotected,forthebenefitofpresentandfuturegenerations,through reasonable legislative and other measures that:

i. prevent pollution and ecological degradation;

ii. promote conservation; and

iii. secure ecologically sustainable development and use of natural resources while promotingjustifiableeconomicandsocialdevelopment.

7.2. LEGISLATIVE MANDATE

The table below indicates core legislative mandates that are applicable to departmental programmesandobjectives.

ProgrammeNameandCoreFunction:

LegalMandate Implications

Economic Development: SMME Development

•NationalSmallBusinessAct,1996(ActNo.102of1996)andAmendments

•BusinessAct1991,(ActNo.71of1991)

Promotepolicyobjectives,facilitatestrategy implementation and align programmes to encourage SMME development in the Province.

•BroadBasedBlackEconomicEmpowermentAct,2003(ActNo.53of2003)

Promoting Broad Based Economic Empowerment in the Province.

Economic Development: Gambling&BettingAdministration

•FreeStateGamblingandLiquorAct

The Act replaces Free State Gambling andRacingAct,1996(ActNo.6of1996)

Economic Development: Consumer Protection

•FreeStateConsumerAffairs(UnfairBusinessPractices)Act,1998(ActNo.14of1998)

•ConsumerProtectionActNo68of2008

Investigation, control and prohibition of unfair business practices. Referral of matters in terms of the National Consumer Affairs Act.

Economic Development: ComplianceMonitoring

•CreditAgreementAct1980,(ActNo.75of1980)

Business compliance monitoring and redress.

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Economic Development: LiquorAdministration

•LiquorAct1989,(ActNo.270f1989)

•NationalLiquorAct,2003(ActNo.59of2003)

Regulating the micro-manufacturing, retailing and distribution of liquor in the Province.

Economic Development: Trade Inspection

•TradeMetrologyAct,1973(ActNo.77of1973)

•CreditAgreementAct,1980(ActNo.75of1980)

Ensure compliance with trade metrology and credit agreement regulations.

Environmental Affairs: ProtectedAreasManagement

•NationalEnvironmentalManagementAct,1998(ActNo.107of1998)andAmendments

Coordination of the implementation, regulation and administration of all mandates entrusted to other sub-programmes and ensure monitoring thereof.

•EnvironmentalConservationAct,1989(ActNo.7of1989)

•FreeStateNatureConservationOrdinance,1969(OrdinanceNo.8of1969)

Promoting conservation in the Province.

•EnvironmentalManagement:BiodiversityAct,2004(ActNo.10of2004)

Ensuring Biodiversity protection in the Province.

•NationalEnvironmentalManagement: Protected Areas Act, 2003(ActNo.57of2003)

Providinganefficientframeworkforthe management of protected areas.

•NationalHeritageRecoursesAct,1999(ActNo.25of1999)

•WorldHeritageConservationAct,1999(ActNo.49of1999)

Ensuring the protection and effective management of National Heritage and World Heritage Sites.

•GameTheftAct,1991(ActNo.105of1991)

Providing a framework for the implications of game theft.

•NationalWaterAct,1998(ActNo.36of1998)

Providing a regulating framework on water usage in the Province.

•NationalEnvironmentalManagement: Waste Act, 2008 (ActNo.59of2008)

Ensuring effective waste management in the Province.

•NationalEnvironmentalManagement: Air Quality Act, 2005 (ActNo.39of2005)

Ensuring the prevention of air pollution in the Province.

•VeldtandForestFireAct,1998(ActNo.101of1998)

Provide a regulatory framework for the prevention and combat of veldt and forestfires.

•ConservationofAgriculturalResourcesAct,1983(ActNo.43of1983)

Ensuring the conservation of vital agricultural resources in the Province.

•AnimalProtectionAct,1962(ActNo.71of1962)

•SpatialPlanningandLandManagement Act No. 16 of 2013 (SPLUMA)

Ensuring the protection of various animal species in the Province

To improve spatial planning and land management practises.

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Tourism •TourismActNo.3of2014

•FreeStateTourismAuthorityAct,2005(ActNo.3of2005)

•TourismsecondamendmentActNo.70 of 2000

To make provision for the promotion of tourism in the Republic; and further to regulate and rationalize the tourism industry

Provide legal and operational framework for tourism promotion and development in the Province.

Act provides for training and registration of tourist guides; and make provision for a code of conduct and ethics for tourist guides.

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8. ORGANISATIONAL STRUCTURE

Annual Report for 2017/18 Financial YearVote 3: Department of Economic, Small Business Development,

Tourism and Environmental AffairsFree State Province

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8. ORGANISATIONAL STRUCTURE

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9. ENTITIES REPORTING TO THE MEC

The table below indicates the entities that report to the MEC:

Name of entity LegislativeMandate Financial Relationship

Nature of Operations

Free State Development Corporation

Free State Development Corporation Amendment Act 4 of 2010

Transfer Payment

•Financeandadvanceeconomicgrowthanddevelopment, Black Economic Empowerment and SMME development and growth.

•PromoteinvestmentandtradewithintheProvinceand to identify, analyse, publicize and market investment and trade opportunities in the provincial economy

Free State Gambling,Liquorand Tourism Authority

Free State Gambling, Liquor Act 6 of 2010 and Tourism Authority Act 4 of 2011

Transfer Payment

•Regulate the gambling and racing activities in the Province on behalf of the Provincial Department.

•Reduce socio-economic and other costs of alcohol abuse. Regulate the micro-manufacturing and retail sale of liquor or methylated spirits.

•Promote tourism and increase market share in the tourism industry and to coordinate marketing activities of all role players.

•Marketmajorsporteventsfortourismpromotion.

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PART B: PERFORMANCE INFORMATION

PART B: PERFORMANCE INFORMATION

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1. AUDITOR GENERAL’S REPORT: PREDETERMINED OBJECTIVES

The AGSA currently performs certain audit procedures on the performance information to provide reasonable assurance in the form of an audit conclusion. The audit conclusion on theperformanceagainstpredeterminedobjectivesisincludedinthereporttomanagement,withmaterialfindingsbeingreportedundertheReportonauditoftheannualperformancereport section of the auditor’s report.

Refer to page 148-150 of the Report of the Auditor General, published as Part E: Financial Information.

2. OVERVIEW OF DEPARTMENTAL PERFORMANCE

2.1 Service Delivery Environment

Population

It is important to consider population statistics when developing and implementing policy in the province. These statistics are important when analysing the provincial economy, as the population growth both directly and indirectly affects employment and unemployment, as well as other economic variables such as economic growth and per capita income.

StatisticsSA,accordingtotheCommunitySurvey(CS), 2016 in this regard indicates that theFreeStateProvincehasthesecondsmallestshare(5%)oftheSouthAfricanpopulation.Provinces with the highest population density, as table 1 indicates, areGauteng (24%),KwaZulu-Natal(20%)andEasternCape(13%).

Table 1: Distribution of land area and population of South Africa by province

Province Squarekm DistributionofLand area in %

Total Population Census 2011

Total Population CS 2016

Distributionofpopulation in %

Western Cape 129 462 11% 5 822 734 6 279 730 11.3%Eastern Cape 168 966 14% 6 562 053 6 996 976 12.6%Northern Cape 372 889 30% 1 145 861 1 193 780 2.1%Free State 129 825 11% 2 745 590 2 834 714 5.1%KwaZulu-Natal 94 361 8% 10 267 300 11 065 240 19.9%North West 104 882 9% 3 509 953 3 748 435 6.7%Gauteng 18 178 1% 12 272 263 13 399 724 24.1%Mpumalanga 76 495 6% 4 039 939 4 335 964 7.8%Limpopo 125 755 10% 5 404 868 5 799 090 10.4%South Africa 1 220 813 51 770 560 55 653 654

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The population in Free State province according to table 1, has increasedover the fiveyearperiodfrom2745590in2011to2834714in2016.Femalesrepresentthemajorityofthepopulationin2016withatotalof1454749(51.3%)followedbymaleswithatotalof1379965(48.7%).

In 2016, the female to male ratio of the province’s population was 96.6 males to every 100females.Thisfigureissimilartothenationalmaletofemaleratioforthesameperiod.With regards to the province’s race demographics, the Free State Province’s population consistedof87.83%African(2.51million),8.54%White(244000),3.28%Coloured(93800)and0.35%Asian(9980)people.

Most of the Free State’s population, in 2016, resides, as per table 2, in Thabo Mofutsanyana (779600)followedbyMangaungMetro(759693),Lejweleputswa(649964)andFezileDabi(494777).Xharieprecordedthelowestpopulationof150681.

Table 2: Population per Metropolitan and District Municipality 2016

Province, District, Local Municipality

Community Survey 2016

Youth Proportion

Personsaged20years+whohavecompletedgrade

12Total population

Male Female Total

Free State 1 379 965 1 454 749 2 834 714 37.4 706 722Xhariep 73 927 76 754 150 681 38.3 29 090Lejweleputswa 324 998 324 966 649 964 37.0 157 183ThaboMofutsanyane

366 168 413 432 779 600 39.8 172 983

FezileDabi 245 985 248 792 494 777 36.4 127 045

Mangaung 368 887 390 806 759 693 35.6 220 420

It is important to note that the highest proportion of youth population, according to Community Survey2016 resided inThaboMofutsanyaneDistrictMunicipality (39.8).XhariepDistrictMunicipality which recorded the lowest population accommodates the second highest proportionofyouth(38.3)intheprovince.

It is thus clear that programmes or initiatives with the focus on youth be embarked upon especially in those regions with the highest proportion of the youth population.

As per table 3 below, the population in the Free State increased by 5.72 percentage points from2006to2016.Mangaung,FezileDabiaswellasLejweleputswaincreasedinpopulationover the ten year period. In contrast, Thabo Mofutsanyane and Xhariep recorded decreases in their population sizes.

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Table 3: % Change in population between 2006 and 2016

Province, District Municipality 2016Free State 5.72%Xhariep -8.96%Lejweleputswa 2.09%ThaboMofutsanyane -2.49%FezileDabi 10.66%Mangaung 17.11%

Population Projections

Based on the present age-gender structure and the present fertility, mortality and migration rates,FreeState’spopulationisprojectedtogrowatanaverageannualrateof0.7%from2.86 million in 2016 to 2.97 million in 2021.

Table 4: Population projections - Free State and National Total, 2016-2021

Free State National Total Free State as % of national2016 2,860,000 55,700,000 5.1%2017 2,880,000 56,500,000 5.1%2018 2,900,000 57,400,000 5.1%2019 2,930,000 58,100,000 5.0%2020 2,950,000 58,900,000 5.0%2021 2,970,000 56,600,000 5.0%AverageAnnualgrowth20162021 0.72% 1.37%

The average annual growth rate in the population over the forecast period for South Africa is 1.37%whichishigherthanthatofFreeState’sgrowthrate,projectedat0.72%.

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GlobalandDomesticEconomicEnvironment

According to the IMF’s estimates, the global economic output for 2017 has grown by 3.7% which is 0.5 percentage point higher than in 2016. The unexpected growth was predominantly noticeable in Europe and Asia which exceeded the forecast as predicted in June 2017 by 0.1percentagepoint.Theglobalgrowthfor2018and2019isprojectedtoriseupto3.9%.The Southern African Development Community real GDP grew by 1.4 percentage points from 2015 to 2016. The Sub-Saharan Africa is estimated to have grown by 2.4% in 2017 compared to the 1.3% in 2016. The region’s largest economies, Nigeria, South Africa and Angola, made the largest contribution towards the recovery as a result of improvement in commodity prices, favourable global financial conditions and slowing inflation whichassisted to lift household demand. South Africa came out of its recession due to strong growth in the agricultural sector and the manufacturing sector recovery; hence, the economy is expected to grow by 1.1% in 2018. In general, growth was weaker because the region is still experiencing negative per capita income growth, weak investment and a decline in productivity.However,regionalgrowthisprojectedtoriseto3.2%in2018andtoanaverageof 3.6% in 2019.

South Africa and Free State Economy

SouthAfrica’sgrossdomesticproduct(GDP)increasedby3.1percentagepointsinthefinalquarter of 2017. The largest positive contributor to growth in GDP in the fourth quarter was theagriculture, forestryandfishing industry,which increasedby37.5percentagepoints,contributing 0.8 of a percentage point to GDP growth. The trade, catering and accommodation industry increased by 4.8 per cent and contributed 0.6 of a percentage point to GDP growth.

The Free State economy is mainly reliant on the tertiary sector. The community services sector, is the largest contributor in terms of gross value added (GVA)within FreeStateProvince accounting for R 49.9 billion at current prices or 25.1% of the total GVA in the province’seconomy.ThesectorthatcontributesthesecondmosttotheGVAisthefinancesector at 17.0% or R 33.8 billion, followed by the trade sector with 13.9% or R27.6 billion. The sector that contributes the least to the economy of the province is the construction sector with a contribution of R 4.83 billion or 2.44% of the total GVA. The remaining sectors’ contributionswere recorded as follows,manufacturing (R 23 billion or 11.6%), transport(R20.8billionor10.5%),mining(R19.7billionor9.9%),agriculture(R9.5billionor4.8%)andelectricityR9.4billionor4.7%).

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The greatest contributor to the Free State economy in 2016 is the Mangaung Metropolitan Municipality with a share of 40.55% or R 90.6 billion, increasing from R 37.2 billion in 2006. The region with the lowest contributor to the Free State economy in 2016 is the Xhariep DistrictMunicipality (DM)withashareofR7.56billion,an increase fromR3.29billion in2006. TheGrossDomesticProduct (GDP)permetropolitananddistrictmunicipalities inthe Free State for the period of 2006 to 2016 indicates that the highest average annual economic growth is Mangaung with an average of 2.92%. The Xhariep with the second highest average annual growth rate of 1.90%, followed by Thabo Mofutsanyane with an average of 1.56%, Fezile Dabi DM with an average annual growth of 1.27%. The lowest averageannualgrowth rate isLejweleputswaDMwithagrowth rateof -1.21%between2006 and 2016.

FreeStateLabourMarket

South Africa’s official unemployment rate decreased by 1.0 percentage point betweenOctober and December of 2017 compared the same period 2017. The largest declines in theunemploymentratewererecordedinNorthernCape(2.8percentagepoints),WesternCape(2.4percentagepoints)aswellastheNorthWestprovinces(2.3percentagepoints).Between October 2017 and December of 2017, the number of discouraged work-seekers grewby103000(or4.2percent)to2.5millionpersons.

Table 5: Summary of labour market measures at a glance, Q4: 2017

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The Free State province experienced an increase in unemployment from the third Quarter to the fourth Quarter of 2017. During Quarter 4, unemployment in the province was recorded as32.6%asillustratedbelow.Theofficialunemploymentrateincreasedby0.8percentagepointsandtheunofficialunemploymentrateincreasedby0.5percentagepoints.

Table 6: Free State Unemployment from Q4: 2016 to Q4: 2017

Officialunemploymentrate ExpandedunemploymentrateOct-Dec2016 Jul-

Sep 2017

Oct-Dec 2017

Qtr-to-qtrchange

Year-on-yearchange

Oct-Dec2016

Jul-Sep 2017

Oct-Dec2017

Qtr-to-qtrchange

Year-on-yearchange

Per cent Percentagepoints Per cent Percentagepoints34,7 31,8 32,6 0,8 -2,1 40,9 38,5 39,0 0,5 -1,9

It is however encouraging that the unemployment rate year-on-year represents a decline of 2.1 percentage points in Q4: 2017 compared to Q4: 2016. The province thus lost 16 000 jobsbetweenQ3:2017andQ4:2017.AnnuallywhencomparingQ4:2016andQ4:2017theprovincewassuccessfulincreating48000jobs.

The size of the province’s labour force decreased by 0.8 percentage points quarter on quarter and the number of discouraged workers increased by 10,3 percentage points during the same period. The province’s priority sector’s recorded both increases and declines in employmentduringthefinalquarterof2017.Bothagricultureandmanufacturingexperiencedan increase in employment, with increases of 3.0 and 0.9 percentage points respectively. In contrast, the mining and transport sectors experienced declines in employment, recording decreases of 6.5 and 22.8 percentage point quarter on quarter respectively.

With regards to the Free State’s priority sectors, both Agriculture and Manufacturing employed morepeopleinthefourthquarterof2017(2000and1000respectively).Incontrast,MiningandTransportshedjobsduringthesameperiod(1000and12000respectively).Thisisshown in the table below.

Table 7: Free State Employment per industry from Q3:2016 to 2017

Oct-Dec 2016

Jan-Mar2017

Apr-Jun 2017

Jul-Sep2017

Oct-Dec 2017

Qtr-to-qtrchange

Year-on-yearchange

Qtr-to-qtrchange

Year-on-yearchange

Thousand Per centAgriculture 65 70 80 75 77 2 13 3,0 19,7

Mining 17 17 15 17 16 -1 -1 -6,5 -5,8 Manufacturing 59 68 69 55 55 1 -4 0,9 -6,1 Transport 36 43 44 51 39 -12 3 -22,8 8,1

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Tourism

Free State Tourism

Globally,tourismisoneofthelargesteconomicsectors,creatingjobs,drivingglobalexportsand generating prosperity worldwide. Research indicates that for every 30 new tourists to adestination,onenewjobiscreated.Thesectorisreportedlyestimatedtoemployalmosttwice as many women as other sectors worldwide. In 2016, the sector grew by 3.1% globally. This continuous growth outpaced that of global GDP by 0.6%. Not only has the sector outperformed economy wide growth for the 6th consecutive years, Travel and Tourism wasalsostrongeringrowththanthefinancialandbusinessservices,manufacturing,publicservices, retail and distribution, and the transport sector.

The Free State provincial government also recognises the role that tourism can play as a driverofeconomicgrowthandjobcreationfortheprovince.Oneofmainreasonsforthisisthe sector’s ability to lend itself to other economic sectors through its broad value chain. The sector is interlinked with other priority sectors including agriculture and manufacturing, thus possessing a multiplier effect on economic growth and development.

The Free State aims to grow its tourism sector to turn what has been called a ‘hidden treasure of South Africa’ into a popular and repeat destination for thousands of domestic and international tourists. The province certainly has the assets that make this goal achievable. Some of these assets include the following designated tourist routes, namely:

•CheetahRoute–ThisroutetakesyouthroughtheMangaungMetropolitanMunicipality–the cultural and political heart of the Free State.

•EagleRoute–SharingthesouthernborderwithLesotho,thisrouterunsfromFicksburgto Harrismith in the Thabo Mofutsanyana District through some of the most picturesque landscape in the country.

•LionRoute–Providesatasteofeverythingthatistypically“FreeState”–fromculturetonature to history exploring attractions in the Fezile Dabi District.

• Flamingo Route – This route runs through the Lejweleputswa District, an importantagricultural and gold-producing area.

•SpringbokRoute-ConnectstheFreeStatewiththeNorthernCapeandwindsthroughthe scenic farmlands and nature reserves of the Xhariep District.

Data shows that, when compared to other provinces in South Africa, the Free State province is currently not achieving its tourism goals given its attractive tourism resource base and offerings. Tourism, one of the province’s priority sectors, thus requires urgent intervention from both the private and public sectors to positively change the economic contribution of tourism in line with other South African provinces, such as Gauteng and Limpopo.

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Table8:Provinceofdestinationbyexpenditureonmostrecentdayandovernighttrips,January–December(concluded),2016(R’000)

Province of desti-nation

Accommodation Food and beverages

Domestic transport

Recreation and culture

Shopping Other Total

Overnight trips

Western Cape 1 142 727 1 219 252 1 744 393 84 011 1 289 768 188 913 5 669 064 Eastern Cape 251 577 636 539 1 599 544 36 696 1 852 170 159 547 4 536 073 Northern Cape 28 789 107 316 246 848 13 576 221 371 17 019 634 919 Free State 111 259 246 341 402 129 21 384 466 794 67 519 1 315 426 KwaZulu-Natal 1 455 274 822 558 1 699 338 96 945 1 834 846 181 127 6 090 088 North West 270 571 323 878 578 378 33 373 512 057 74 792 1 793 049 Gauteng 378 700 694 407 1 707 143 88 987 1 426 649 219 876 4 515 763 Mpumalanga 560 844 955 437 956 824 26 937 771 744 58 135 3 329 920 Limpopo 186 587 625 943 1 369 954 27 147 1 472 912 141 602 3 824 145 Unspecified 924 636 664 967 1 395 107 249 743 927 757 82 178 4 244 388 Total overnight trips spending

5 310 963 6 296 639 11 699 659 678 797 10 776 068 1 190 708 35 952 834

The table above shows the total expenditure for the year 2016 per province on overnight trips and indicates that annually R5 310 963 000 was spent on accommodation nationally. On average, guest spending on overnight accommodation was recorded as R323.43 per guest for the Free State province. Total spending on accommodation annually for overnight trips in the Free State province stood at R111 259 000 for the period. Although this amount represents a large percentage of tourist expenditure in the province, the total amount generatedprovinciallyforaccommodationissignificantlylowerthanwhathasbeenrecordedin the other provinces.

Domestic tourism plays a critical role in the tourism sector as it generates more than half theinternaltourismrevenue,accordingtoareportreleasedbySouthAfricaTourism(SAT).Although domestic tourism declined in 2016 in Free State province, table 2 below, with 0.7% compared to 2015, total domestic expenditure increased in the same period by 12.3% when compared to 2015. Additionally, this indicated an improvement comparing the 5% growth recorded in 2015 with the 3.7% growth in 2014.

Table9:FreeStateDomesticPicture2013-2016

Free State 2013 Free State 2014 Free State 2015 Free State 2016Size 878 000 1 043 000 1 200 000 1 140 000Growth(%) 3.4% 3.7% 5% 4.3%Direct Spend 712 535 000 1 124 933 000 1 046 634 000 1 210 253 000AverageStay(nights) 4.2 4.7 3.8 4.4

Bednights 3 725 000 4 858 000 3 431 000 4 981 000

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An upward growth trend in foreign tourism, as indicated in the table 10 below, was recorded in the province from 8.9% in 2013 to 12.2% in 2016 which is very encouraging.

Table10:FreeStateForeignPicture2013/2016

Free State 2013 Free State 2014 Free State 2015 Free State 2016Size 796 706 960 147 947 861 1 223 631Growth(%) 8.9% 10.1% 10.6% 12.2%Direct Spend R1 949 995 677 R1 206 003 374 R1 320 771 995 R1 148 063 103AverageStay(nights) 10.0 9.6 9.7 7.8Bednights 7 698 163 8 910 529 8 824 031 9 176 032

ThetablebelowreflectstheTotalSpendingofNationalinrelationtothatoftheFreeStateProvince.

Table11:TotalTourismSpending–FreeStateandNationalTotal,2007-2017(Rbillions,currentprices)

Free State National Total2007 5.4 138.72008 5.9 152.52009 5.9 153.42010 6.3 167.22011 6.6 174.6

2012 7.7 199.92013 8.7 218.32014 10.0 240.72015 10.6 249.72016 11.7 265.82017 12.8 281.4AverageAnnualgrowth20072017 8.99% 7.33%

Free State Province had a total tourism spending of R 12.8 billion in 2017 with an average annual growth rate of 9.0%since2007 (R5.42billion).Basedon the current economicperformance,itisprojectedthattheGVAfortourismwillcontinuetoincreaseoverthenext5 year period.

This, without doubt, indicates that the tourism sector is resilient and bodes well for the future economic growth of the province.

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Environment

The regulatory environment practiced by the Department requires of us to not only promote environmental policies, but ensure environmental compliance measures to protect the environment for current and future generations. Key amongst these measures is compliance to the following:

• TheNationalEnvironmentalManagementAct, 107of1998with itsSEMA’s (SpecificEnvironmentalManagementActs)

•Chapter5onEnvironmentinrelationtotheNationalDevelopmentPlan

•Outcome10DeliveryAgreement

•EXCOResolutionsonEnvironmentProjectsandProgrammes

•SOPAandDepartmentalBudgetVoteSpeechInjunctions

The need for socio-economic radical transformation has brought in a new era within the space of environment. The paradigm shift calls for the environmental pristine environment shouldalsobeusedtoanimpetusforeconomicdevelopmentandjobcreation.ItisinthiscontextthatthedepartmentalEnvironmentalManagementCommittee(EMC)hastoassessand recommend for approval all Environmental ImpactAssessments (EIA’s) in line withthese policy imperatives and societal change to offset the past legacy imbalances.

The call is not only to protect our pristine environment and biological diversity, but to utilise the recently approved Biodiversity Economy Strategy in transforming and empowering the fullparticipationofpreviouslydisadvantagedindividualsineconomicbeneficiationprocessessuch as the Wildlife Economy, Waste Economy and Game Industry Transformation. Development Initiatives has resulted in the department introducing the e-Permit System to facilitateefficiency inBiodiversityPermitsapplicationprocesswithinashorterturnaroundperiod. The effects of climate change resulting in drought and poor rainfalls demands of the department to respond to these challenges. We have recently completed the Free State Province Climate Change Vulnerability Assessment Strategy in this regard, with policies that will be directed to all key sectors within the province. All of the above should be done within the regulatory function and coordination processes provided by the State of Environment OutlookReport including theEnvironmental ImplementationPlan (EIP) in relation to theenvironment sector coordination.

The foundation to achieve these programmes is embedded in our Environmental Education and Awareness Programs focusing on all communities, learners and other interested and affected parties. This is in line with Section 24 of the RSA Constitution.

GlobalChangehasresulted innewtechnicalfields liketheGreenEconomyandClimateChange. The department is well poised in responding to these new challenges with programs andprojectsaccommodatedinourAnnualPerformancePlan.

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Protected Areas in the Free State Province include:

1. Caledon Nature Reserve

2. Erfenis Dam Nature Reserve

3. Gariep Dam Nature Reserve

4. Kalkfontein Dam Nature Reserve

5. Maria Moroka Game Reserve

6. Sandveld Nature Reserve

7. Seekoeivlei Nature Reserve

8. Soetdoring Reserve

9. Sterkfontein Dam Reserve

10. Tussen die Riviere Reserve

11. Willem Pretorius Game Reserve

12. Karee Nature Reserve

13. Wuras Dam Nature Reserve

14. Ficksburg Nature Reserve

15. Koppies Dam Nature Reserve

16. Rustfontein Dam Nature Reserve

17.Inclusiveof16MunicipalOwnedProtectedAreasand1(one)Stewardshipsiteis(SneeuwbergProtectedEnvironment)declaredprivatelyownedProtectedAreasin 2018.

Various factors have influenced land use patterns in the Free State Province, themostimportant of which are soil type, rainfall distribution, mineral deposits, transport routes and political background. Of the total FS surface area, agriculture accounts for 90% of land use, 7% is used for settlements, 1.6% is set aside for formal conservation, while mining activity occupiesapproximately0.4%oftheProvince.BiodiversityisdefinedintheBiodiversityAct(ActNo.10of2004)as“thevariabilityamonglivingorganismsfromallsources,includingterrestrial, marine and other aquatic ecosystems and the ecological complexes of which they are part and also includes diversity within species, between species and of ecosystems”. Only about 3.4% of the land surface of the FS was formally conserved. The Vredefort Dome and Maluti-Drakensberg Transfrontier Conservation Area are World Heritage sites.

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A wide range of wetland types occur in the Free State, which contribute towards the overall biological diversity of the Province with Seekoeivlei Nature Reserve a Ramsar site of international importance. Climate change is expected to bring considerable warming and drying to much of this already semi-arid region, with greater frequency and intensity of extremeweathereventssuchasheatwaves,floodinganddrought.ThreebiomesoccurwithintheFreeState,namelytheGrassland(72%oftheProvince),NamaKaroo(22%),andSavannah(6%).Thethreekey,inter-relatedthreatstobiodiversityandecosystemhealtharehabitat destruction, invasive alien species and climate change. About 34% of the grassland biome in the Free State has been irreversibly transformed through development, such as urban settlements, mining, agriculture and industrial facilities.

The average rainfall in South Africa is about 450 mm per annum, which is well below the worldaverageof860mmperannum.IntermsoftheUnitedNationsdefinition,SouthAfricais a water stressed country, bordering on water scarcity. As a result, sound management of thisvaluableresourceisessentialtoensureoptimumsocialandeconomicbenefittofurtherthe aims and aspirations of all the people.

The Free State Province is bordered in the north and northwest by the Vaal River, in the south by the Orange/Gariep River and in the east by the Caledon/Mohokare River. Numerous majortributaries,theWilge,Liebenbergsvlei,Renoster,Vals,Sand,Vet,ModderandRietRivers divide the Province into eleven secondary drainage regions. Two primary catchment areas(anareaoflandfromwhichanyrainfallwilldrainintothewatercourse)arelocatedinthe Free State, namely the Vaal River catchment and the Orange River catchment. Surface water resources are well developed through the construction of several large dams. The water supply is augmented by various transfer schemes that import water from other water managementareas(WMA),aswellasfromtheKingdomofLesotho.Futurewatersupplywill depend on increased water transfers. Groundwater is currently used for rural domestic supplies, stock watering and water supply to several towns, where surface water supply is inadequateorbulkwatersupplyisnotfinanciallyfeasible.Groundwateriswellutilisedforwater supply in the Middle Vaal, Lower Vaal and Upper Orange WMAs and is the only water resource available in many areas.

Deteriorating water quality is impacting on the quantity of water available for the different uses. Keyissuesofconcernincludethepoorqualityeffluentdischargedfrommunicipalsewagetreatment works due to overloading and/or poor operations and maintenance, polluted storm water run-off, high salinity pollution due to mining activities, as well as elevated salinity and nutrient pollution from poor farming practices. As a consequence of increased pollution levels, river health has deteriorated, resulting in loss of river functions and services, as well as the sustainability of the river ecosystem. Many wetlands of the Free State have also been directly and/or indirectly impacted upon by a variety of different land uses and from chemical and biological pollutants.

Ambient air quality is impacted by human activities. Coal and wood is still often used as a fuel for cooking and heating in lower income communities, which generates emissions that are harmful to health and quality of life. Parameters are monitored continuously and reported to the national DEA and DESTEA on a monthly basis. Methane, a greenhouse gas, is emitted frommining ventilation shafts.Waste incineratorshavebeen identifiedas theprinciplesourceofdioxinsandfurans(PersistentOrganicPollutants(POPs).OthersourcesofPOPsincludeobsoletepesticides,whichhavenotbeenquantifiedintheFreeState.

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Policy Environment

The mandate of the Department emanates from national and provincial policies as well as legislative frameworks, as described in our 2015 – 2020 Strategic Plan. In addition to the policies and legislation mention in the Strategic Plan of the Department, the Presidency has developedaNationalDevelopmentPlan(NDP)Vision2030.Thisplan,whichmapsoutthedirection South Africa should take to achieve Vision 2030, was considered when developing the 2017/18 Annual Performance Plan. The main themes emphasised by the NDP includes:

•Economyandemployment

•Economicinfrastructure

•Transitioningtoalowcarboneconomy

•Inclusiveruraleconomy

•PositioningSouthAfricaintheworld

•Humansettlement

•Promotinghealthand

•Socialprotection

TheMediumTermStrategicFramework(MTSF),theNinePointPlanofGovernment,theProvincial Growth and Development Strategy and the Provincial Programme of Action has also been encapsulated in the content of this plan.

Demand for services

The demand for environmental services is largely driven by the legislative mandate of the department to protect and sustain the natural resources of the province. The services provided by the department in this regard therefore focusses in the main on the enforcement of environmental legislation, the management of bio-diversity and climate change, as well as environmental awareness and education.

The demand for economic related services is attributable to both push and pull factors. The macro-economic policies of government has resulted in the rendering of certain services in ordertoachievethevariouspolicyobjectives,suchastourismandindustrialdevelopment.On the other hand, the current low GDP and GVA levels in the province, coupled with significantlyhighlevelsofunemploymenthasnecessitatedthedeliveryofcertainservices,such as SMME support, mining town support and township revitalization.

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2.2 Service Delivery Improvement Plan

The department has completed a service delivery improvement plan. The tables below highlight the service delivery plan and the achievements to date.

Main services and standards

Main services Beneficiaries Current/actual standard of service

Desired stan-dard of service

Actual achievement

Enterprise support and development

Enterprises in the Free State

150 120 649

Batho Pele arrangements with beneficiaries (Consultation access etc.)

Current/actualarrangements Desiredarrangements Actual achievements

Consultation

Roadshows were conducted in Fezile Dabi and Thabo Mofutsanyana District Municipalities.

Conduct stakeholder engagements in all Districts and the Metro.

All Districts and the Metro conducted stakeholder engagements /

Roadshows.

MEC roadshows were held in 25 municipalities.

Courtesy

Regular Update on received applications for Assessments by BATC

Regular update on requests received.

Applicants were regularly informed about the status of their applications.

AccessService Centers established in all districts except Xhariep.Service Centers struggling with tools of trade to reach outlying towns.

Increase outreach to outlying towns by the Service Centers andHeadOfficebyemployingmore personnel and providing tools of trade.

Small Business and Economic Development hired almost 25 personnel and all Service Centers had middle managers to lead them.

InformationBrochures and pamphlets on enterprise support and development distributed to Service Centers and Municipalities.Information sessions conducted.

Hold Information Sessions / Roadshows.Increase media coverage of enterprise support and development of DESTEA.

All Service Centers held numerous information sessions including Head Office.MEC led numerous information sessions with Municipalities.525mediaappearances(bothinprintandelectronic).Regular updates on Social Media: Tweeter and Facebook.

Openness and Transparency Enterprise Support and Development reports submitted Quarterly and Annually.

Submission of quarterly reports and annual report.

Quarterly and annual reports submitted.

Redress

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Current/actualarrangements Desiredarrangements Actual achievements

No clear guidelines / mechanisms to ensure redress

Feedback on unsuccessful applications to be provided.

Refer some applications to relevant departments or DFIs.

Inter-Departmental BATC sessions has enhanced referrals.Tabalaza provides an easy channeling of innovative ideas to funding institutions.

Value for MoneySupported and developed businesses to show growth through increased produc-tionand/orjobscreated.

30 enterprises to be supported and developed in 2017/18

Six enterprises that were funded and of the R6, 7million in funding by Department, R28, 7 million funding byDFIswasunlocked.1000jobopportunities were created.

Human Resource

The unit had vacant post for 2016/17. Theplanwastofillallcriticalpost before the end of the financial2017/18

8 Trade advisors, 1 Director and 1 Deputy Director for Thaba Mofutsanyane Service Centre were appointed.

Service delivery information tool

Current/actual information tools Desired information tools Actual achievements125 Information Sessions

125 Training Sessions

To have Roadshows, Forums, Summits, Business Regulation Workshops and Red Tape Reduction Meetings.

14 X Roadshows; 8 X Economic Forums; 2 X Summits; 2 X Business Regulation Workshops and 4 X Red Tape Reduction Meetings.

Complaints mechanism

Current/actual complaints mecha-nism

Desired complaints mechanism

Actual achievements

Service Charter Provision Service Charter Provision

Complaints and. Compliments Box at all service points.

Complaints Mechanism for each service point.

Service Charter Posters with complaints mechanismdisplayedatHeadOfficeand Service Centres.

Complaints and Compliments box placed at all Service Centres.

Developed template for complaints mechanism for each service centre

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2.3Organisationalenvironment

Programmestructure

There were no changes in the programme structure of the Department, which is illustrated in the table below:

Programme Subprogramme1. Administration 1.1 OfficeoftheMEC

1.2 Management Services1.3 Financial Management 1.4 Corporate Services

2. Environmental Affairs 1.5 Environmental Policy, Planning and Coordination1.6 Compliance and Enforcement1.7 Environmental Quality Management1.8 Biodiversity Management 1.9 Environmental Empowerment Services

3. Economic and Small Business Development

1.10 Integrated Economic Development1.11 Economic Research and Planning1.12 Small Business Development

4. Tourism 1.13 Tourism Planning1.14 Tourism Growth and Development1.15 Tourism Sector Transformation

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Personnel

As at 31 March 2018, the Department had a workforce of 692, this is inclusive of 675 permanent employees and 17 contract workers. In addition to the above, the department had 2 categories of employment contracts namely; Interns and Security Learners. During 2017/18financialyear,theDepartmenthad9graduateinternsand19SecurityLearners.Of the 9 Interns, 7 were recruited in the department and the 2 remaining Interns were unsuccessful. All the 19 Security Learners were recruited in the department with effect from 01 April 2018. The current vacancy rate is standing at 41,34%. The highest percentage of vacancy rate is as a result of unfunded vacancies in terms of the actual structure as thedepartment recentlyfinalised implementationof itsapprovedstructure.However, thedepartment has undertaken the process to abolish unfunded vacancies on Persal and after the exercise, 877 posts instead of 1674 will be implemented on Persal. This will translate to185poststhathavebeenprioritisedforfillingovertheMTEFperiod(2018-2020)andthevacancy rate will decrease to 21.1% as on 01 April 2018.

Theageprofileofthedepartmentisnotofamajorconcernintermsofcriticaloccupation,however, measures needs to be put in place in order to address anticipated retirement in some programmes such as Environmental Branchwhere it will be losingmajority of itsemployees.Ofthe692employees,190(27.5%)arebetweentheagesof18and35years(youth),87(12.6%)arebetweentheagesof36and39,198(28.6%)arebetweentheagesof40and49,181(26.15%)arebetweentheagesof50and59,36(5.2%)arebetweentheagesof60and65.Onehundredandnine(109)oftheseemployeeswillberetiringinthenext5-10yearsthroughnormaland/orcompulsoryretirement.Ofthisnumber,86(78.9)arefromEnvironmentalManagementBranch,15(13.76%) fromAdministrationand8 (1.1%)are from Economic Development.

During2017/18financialyear,thedepartmentadvertised100postsandallthepostswerefilled.Partofthe93poststhatcouldnotbefilledduringthe2016/17financialyearwerealsofilledfromApril2018,whichhasseenthedepartmentfilling149postsduringthisfinancialyear.Twenty-six(26)ofthesepostscanbeclassifiedasfollows:SMS(5),MMS(8)andJuniorManagement(13).Sixty-fivepercent(65%)of the149postswerefilledbywomenand60%atSMSlevel.There were 25 employees who were promoted, 34 contract workers were permanently appointed (excludingtheSecurityLearners).

The total number of employees who left the department is 92 which translates into 13.3% of the totalworkforce.Thefigureishigherthanthenationalbenchmarkof8%.Itcanalsobeindicatedthatthefigurehasgoneupascomparedtolastyearwherethedepartmentwasstandingat7.6%.Themajorityofemployeeswholeft thedepartmentareduetoexpiryofcontracts.Ofthe68,fourteen(14)officialsresigned,twentysix(26)officialsweretransferred,thirty-four(34)officialswere appointed on contract and contract appointments were terminated due to permanent appointmentinthedepartment,five(5)officialsleftthedepartmentduetoearlyretirement,two(2)officialsleftduetoill-healthretirement,seven(7)officialleftduetonormalretirementandfour(4)officialsservicesgotterminatedduetodeath.Thesignificanthighnumberofattritionisnotofaconcern due to the fact that the employees whose contract expired were permanently appointed. The other contributing factor to the highest number of attrition rate was transfers which were due totheapplicationofsection14(4)ofthePublicServiceAct.

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Thirty-four (34) grievanceswere lodged and 23misconduct caseswere reported during the2017/18financialyear.Ofthe34grievanceslodged,27wereresolvedwithin30days,7wereresolvedoutsidetheprescribedtime-frames.Two(2)misconductcaseswerefinalisedwithin90days, 1 outside the prescribed time-frames and 20 are outstanding. The factors which contributed tothemisconductcasesnotfinalisedwithin90dayswereasfollows:

•Non-availabilityofpresidingofficersorallegedoffenders;

•Postponementofdisciplinaryhearings;

•Longinvestigationsduetonon-availabilityofexternalpeopletobeinterviewed.

•Veracityofdocumentsneededbyoffendersthroughpointsinlimine,whichdelaysprocess.

2.4Keypolicydevelopmentsandlegislativechanges

Therewerenomajorchangestopoliciesandlegislation,duringtheperiodunderreview,whichhadamajorimpactonoperations.

The Department continued with implementation of the following:

1. All environmental policies and legislation.

2. Trade related policies.

3. Economic development policies, including SMMEs and cooperatives development. Consumer protection and business regulations policies and legislation.

4. Tourism related policies.

The Small Business Development Unit of the department was established during 2014/15, in response to the establishment of the SBD National Ministry, and relevant pronouncements made by the Executive of the Province.

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The table below explains the various areas contained in the NDP, MTSF and FSGDS to which the Department contributed during the past year:

NDP MTSF FSGDSChapter 3: Economy and employment Outcome 4: Decent employment

through inclusive growthDriver 3: Expand and diversify man-ufacturing opportunities

Chapter 5: Environmental sustainability Outcome6:Anefficient, competitiveand responsive infrastructure net-work(SIP’sandSEZ’s)

Driver 5: Harness and increase tourism potential and opportunities

Chapter 13: Building a capable and devel-opmental state

Outcome 10: Protect and enhance our environmental assets and nation-al resources

Driver 12: Integrate environmental concerns into growth and development planning

Chapter 14: Fighting Corruption Outcome 12: An efficient, effectiveand developmental orientated public service

Driver 15: Foster good governance to create a conducive climate for growth and development

3. STRATEGIC OUTCOME ORIENTED GOALS

InorderfortheDepartmenttofulfilitsmandate,ithassetthefollowingstrategicgoals:

StrategicGoal1 Provisionofleadershipforeffectivesocio-economicdevelopment

Goal statement To substantially improve socio-economic development through astute leadership in the form of strategic direction, monitoring and accountability.

StrategicGoal2 Creationofefficientandeffectivefinancialmanagementsystemforsustainability

Goal Statement Toensurethatappropriatemethodologies,guidelinesandprocessesforfinancialmanagementisapplied,inanefficientandaccountablemanner.

StrategicGoal3 Buildaresponsivehumanresourceattributethatisresponsivetoservicedemands

Goal Statement To ensure that organizational human resources are skilled, equipped, healthy and motivated in order to meet the service delivery demands placed on the department.

StrategicGoal4 Integratedeconomicdevelopmentforradicaltransformation

Goal StatementTo ensure that economic development is planned and executed in an integrated manner, addressingtheissuesofpoverty,jobcreationandinequality,whilstpromotingacultureofriskavoidance, awareness and adaptation.

StrategicGoal5 Inculcateaccountableenvironmentalmanagement forsustainabledevelopmentandinclusiveeconomicgrowth

Goal StatementTo ensure, transparent, accountable and democratic environmental management systems and processes, which will support sustainable development and inclusive economic growth in the province.

StrategicGoal6 Fostertourismsectortransformationanddevelopmentforimprovedmarketshare

Goal Statement To ensure transformation in the tourism sector, in order to promote equity, investment, and growth in both domestic and international tourism.

42

StrategicGoal7 Business process optimization for better programme performance & co-operation

Goal StatementTo ensure optimal organizational performance and service delivery through managing and optimizing internal business processes, with emphasis on internal resource optimization, processre-designforefficiency,technologyadaptationandstrengthenedaccountability.

Progress made towards the achievement of these goals is explained elsewhere in Part B of this report.

TheDepartmentcontributedsignificantly tothefollowingOutcomes,ashighlighted inthetable below:

NDP MTSF Highlights*Chapter 3: Economy and employment

Outcome 4: Decent employment through inclusive growth

•ContinuoussupporttonewandexistingSMME’s

•Continuoussupporttoexistingandnewcooperatives

•TradeandinvestmentpromotionviaFreeStateDevelopment Corporation

•EducationandsupporttoclientonConsumerRights

•Continuoustourismpromotionandmarketing

•FreeStateSmallbusinessdatabasedeveloped.

•ProvincialEconomicDevelopmentforumlaunched.

• Free State Provincial Economic Development Strate-Framework developed

Chapter 5: Environmental sustainability

Outcome 10: Protect and enhance our environmental assets and national resources

•Expansionoflandunderconservation

•Wetlandconservation

•Upgradeofcertainresortsandreserves

•Continuesenforcementofenvironmentallegislation

•WildlifeAuctionConducted

•Promotionofwasterecycling

•HostCOP21stakeholders’workshoponClimateChange.*Details of achievements are explained elsewhere in Part B of this report.

43

4. PERFORMANCE INFORMATION BY PROGRAMME

4.1Programme1:AdministrationTo provide leadership and strategic management in accordance with Policy and Legislation and to provide appropriate support service to other programmes.

Sub-Programmes:

Programme SubProgrammeAdministration 1. Management Services

2. Financial Management

3. Corporate Services

This programme contributed to the following priorities:

• NDP:

o Chapter 13: Building a capable and developmental state

o Chapter 14: Fighting Corruption

• MTSF:

o Outcome12:Anefficient,effectiveanddevelopmentalorientatedpublicservice

• FSGDS:

o Driver 15: Foster good governance to create a conducive climate for

growth and development

44

ManagementServices

StrategicObjectivesSub-ProgrammeManagementServices

Strategicobjectives

Performance Indicator

Actual Achievement 2016/2017

Planned Target2017/2018

Actual Achievement2017/2018

Deviation from plannedtarget2017/2018

Comments on deviations

Internal Audit

1.1 Accelerate implementation &enforceaccountability.

Ensure overall corporate compliance.

Number of internal audit plans developed

1 1 1 0 -

1.2 Number of internal audit charters developed

1 1 1 0 -

1.3 Number of audit committee charters developed

1 1 1 0 -

1.4 Number of internal audits performed.

- 12 20 +8 Due to in-year amendments of the Audit Plan.

RiskManagement1.5 Strengthen risk

&regulatorycompliance.

Number of reviews conducted on risk registers

- 1 1 0 -

1.6 Number of monitoring and review of new risks

- 4 0 -4 Late approval of Strategic and operational registers.

1.7 Number of invitations issued

- 4 2 -2 RMC Meetings not be convened.

1.8 Number of RMC reports

- 4 2 -2 RMC meetings could not be conducted in time due logistical reasons.

1.9 Number of AC meetings attended

- 4 2 -2 Unavailability of CRO.

45


Strategicobjectives







StrategicPlanning,MonitoringandEvaluation

1.10 Ensure overall corporate compliance

Number of plans facilitated and submitted to Treasury.

1 1 1 0 -

1.11 Number of an annual reports submitted.

1 1 1 0 -

1.12 Number of service delivery planning documents developed

4 5 5 0 -

1.13 Number of FSDM reports compiled

- 16 16 0 -

1.14 Number of MPAT Self-Assess-ments facilitated

1 1 1 0 -

1.15 Number ofprojectsassessed.

- 12 13 +1 Additional request was received from SBD.

1.16 Number of unit asset, SCM and financialreportscompiled.

36 36 36 0 -

46


Strategicobjectives







SecurityServicesandAnti-Corruption

1.17 Ensure effective corporate compliance

Number of security-awareness sessions conducted

4 4 3 -1 Loss of documentation due to movement of the department to new building.

1.18 Number of monitoring reports on security related matters.

8 4 2 -2 Loss of documentation due to movement of the department to new building.

1.19 Number of awareness cam-paigns on Fraud and Anti-Corrup-tion conducted.

- 2 2 0 -

1.20 Number of reports on Fraud and Corruption cases investigated

- 2 1 -1 Demand driven

1.21 Number of reportsonZ204forms submitted to SSA.

- 2 1 -1 Loss of documentation due to movement of the department to new building.

1.22 Number of training sessions conducted

- 2 1 -1 Loss of documentation due to movement of the department to new building.

1.23 Number of SOPs implemented

- 1 0 -1 Due diligence on the SOP could not be completed in time.

1.24 Number of departmental events supported by security services

- 4 9 +5 Demand Driven

47


Strategicobjectives







Communication

1.25 Improve corporate communication and coordination

Number of platforms identifiedandused

- 4 3 -1 Appointed service provider failed to deliver.

1.26 Number of engagements with strategic partners

- 4 0 -4 No engagement requests were received.

1.27 Number of implementation plans developed

- 12 12 0 -

1.28 Number of approved Communication Strategies

- 1 1 0 -

1.29 Number of media interviews conducted

- 12 154 +142 Due to MEC Roadshows

1.30 Number of media statements issued


1.31 Number of campaigns


1.32 Number of publications produced.

- 4 4 0 -

1.33 Number of promotions

- 4 4 0 -

1.34 Number ofprofiledprogrammes.

- 4 4 0 -

1.35 Number of media appearances


1.36 Number of successful projectscommunicated

- 2 2 0 -

1.37 Number of events coordinated.

- 2 2 0 -

48


Strategicobjectives







InformationTechnologyandKnowledgeManagement

1.38 Implement appropriate technology

Strengthen access to services/programs

Fosterlearning&innovation

Develop business capabilities

Number of e-Government initiatives implemented

0 2 2 0 -

1.39 Number of department-wide business process mapping.

- 1 0 -1 No responses to request for proposals received by SCM.

1.40 Number of implemented ICT solutions.

- 2 2 0 -

1.41 Number of monitoring reports compiled for ICT services, usage of IT resources and ICT security risks.

4 4 4 0 -

49


Strategicobjectives







LegalServices1.42 Consistent quality

service provisionNumber of departmental legislation drafted.

1 1 1 0 -

1.43 Number of contracts drafted and vetted.

- 4 16 +12 Demand driven.

1.44 Number of workshops on the Implementation of PAIA and PAJA.

2 1 1 0 -

1.45 Number of SOPs on misconduct processes &grievanceprocedure and legal services reviewed.

- 3 3 0 -

1.46 Number of awareness sessions conducted on SPO’s.

- 1 1 0 -

1.47 Number of awareness conducted to promote Sound Labour Peace.

- 1 1 0 -

1.48 Number of publication of PAIA Manual on DESTEA database

- 1 1 0 -

1.49 Number .of reports on compliance with PAIA and PAJA

- 1 1 0 -

1.50 Number reports on grievances finalised

- 12 12 0 -

1.51 Number of reports on misconduct cases reported andfinalised

- 12 12 0 -

1.52 Number of reports onconflictsanddisputes resolved

- 4 4 0 -

50

Strategiestoovercomeareasofunderperformance:

•ImproveICTprojectmanagement.

•CurborreduceareasofunderperformanceinSecurityServices,Anti-Fraudand Corruption Unit:

4.1.3. FinancialManagement


Strategicobjectives





Deviation from planned target2017/2018


ManagementAccounting

1.1 Effectivefinancialmanagement

Improve expenditure management

Number of credible budget statement submitted to treasury on time.

1 1 1 0 -

1.2 Number of credible adjustmentbudgetsubmitted to Treasury on time.

1 1 1 0 -

1.3 Number of in-year monitoring reports submitted to treasury on time.

12 12 12 0 -

FinancialAccounting1.4 Improve revenue

collection&manage growth.

Financial stewardship

Improvefinancialsustainability

Number annual financialstatementcompiled according to prescripts.

1 1 1 0 -

1.5 Number Quarterly interim statements compiled according to prescripts.

3 3 3 0 -

51


Strategicobjectives







SupplyChainManagement

1.6 Implement cost efficiencies

Percentage of payments made to creditors within 30 days from receipt of an invoice.

100 100% 100% 0 -

1.7 Number of days to conclude quotes/bids

•TransversalContracts:

•Pricequotations(<30000)

•Pricequotation(30000-500000)

•Bid/Tenders

2

4

10

60

2

4

10

60

2

4

10

0

0

0

0

-60

No tenders were issued in the financialyear under review.

1.8 Annual procurement plan(PP)developed.

1 1 1 0 -

1.9 Number of expenditure analysis reports done.

•Catering.

•Stationery.

•Laboursavingdevices.

•Targetedprocure-mentspend(70%).

•Cell-phones

•Travellingagency

•TransportandShuttle service

•EventManagement

128 32 32 0 -

1.10 Number of inventory count reports

2 4 0 -4 A decision was taken that DESTEA would not keep inventory.

52


Strategicobjectives







FleetandAssetManagement1.11 Improve

record asset management.

Increase asset utilization

Implement proper inventory turnover.

Number of stocktaking reports.

2 1 1 0 -

1.12 Number of disposal reports.

- 4 4 0 -

1.13 Number of facilities management plans (U-AMP)developed.

1 1 1 0 -

1.14 Number of all movables assets verificationreportsdeveloped.

- 4 4 0 -


•Developanactionplantoimproveareasofunderperformance.

53

4.1.4. Corporate Services


Strategicobjectives






Comments on devia-tions

Corporate Services1.1 effective corporate

Foster a high performance culture

Optimize staff productivity

Number of HIV Counselling and Testing (HCT)conducted.

2 2 2 0 -

1.2 Number of Health Risk Assessments (HRA)conducted.

- 2 2 0 -

1.3 Number of gender Equality Strategic Framework Plan submitted.

- 1 1 0 -

1.4 Number of Job Access Strategic Framework Plan submitted.

- 1 1 0 -

1.5 Number of Youth Development Plans submitted to the Department of the Premier.

- 1 1 0 -

1.6 Number of Gender Equality Strategic Framework Report submitted.

- 1 1 0 -

54

1.7

Ensuring effective corporate compliance

Foster a high perfomance culture

Optimize staff productivity

Ensuring effective corporate compliance

Recruit and develop workforce

Continuous improvement process

Enhance change management practises&trainingclimate

Clarify roles and responsibilities

Number of Job Access Strategic Framework Report submitted to DPSA

- 1 1 0 -

1.8 Number of Youth Development Reports submitted to the Presidency

- 4 4 0 -

1.9 Number of organisational structure updated

- 1 1 0 -

1.10 Number of bi-annual health and safety inspections conducted

- 2 2 0 -

1.11 Number of business processes to be mapped

- 5 5 0 -

1.12 Number of approved organisational structure captured on PERSAL

- 1 1 0 -

1.13 Number of SOP's developed

- 5 5 0 -

1.14 Number of workshops on diversity management

- 2 3 +1 Based on the previous session, a need was identifiedtodo another workshop

1.15 Number of workshops on change management

- 1 1 0 -

1.16 Numberofjobdescriptions reviewed

- 50 50 0 -

55


•Noneastherewerenoareasofunderperformance.

Changes to planned targets

Indicator Original2017/18 Target

Adjusted 2017/18Target

Quarter 1 Target

Quarter 2 Target

Quarter 3 Target

Quarter 4 Target

Reason for Amendment

Number of workshops on change management

4 1 - - - 1 Reprioritization of funds after 2017/18 AdjustmentBudget Allocation.

Linkingperformancewithbudgets

Sub-programme expenditure

ProgrammeName

ADMINISTRATION

2016/2017 2017/2018Final

AppropriationActual

Expenditure(Over)/ Under Expenditure

Final Appropriation

Actual Expenditure

(Over)/UnderEx-penditure

R’000 R’000 R’000 R’000 R’000 R’000SubProgram

OfficeoftheMEC 8,097 7,936 161 11,579 10,067 1,512

Management Services

25,690 25,333 357 26,972 27,424 (452)

Financial Management

62,924 62,648 276 66,369 70,482 (4,113)

Corporate Services 39,728 38,827 901 36,179 33,083 3,096

TOTAL 136,439 134,744 1,695 141,099 141,056 43

56

4.2Programme2:EnvironmentalAffairsandConservation

To implement and monitor legislation and policies in the areas of Air Quality, Biodiversity, Climate Change, Compliance Monitoring, Environmental Impact, Protected Areas, Pollution Control, Protected Areas and Waste Management.

Sub-Programmes:

Programme SubProgrammeEnvironmental Affairs and Conservation 1. Environmental Policy Planning and

Coordination

2. Compliance and Enforcement

3. Environmental Quality Management

4. Biodiversity Management

5. Environmental Empowerment Services


•NDP:

o Chapter 5: Environmental Sustainability

•MTSF:

o Outcome 10: Protect and enhance our environmental assets and national resources

•FSGDS:

o Driver 12: Integrate environmental concerns into growth and development planning.

57

4.2.1. EnvironmentalPolicyPlanningandCoordination

StrategicObjectivesEnvironmentalPolicyPlanningandCoordination

Strategicobjectives







1.1 Regulatory environment enforcement

Number of intergovernmental sector tools reviewed.

2 2 2 0 -

1.2 Number of legislative tools developed.

- 2 2 0 -

1.3 Number of environmental researchprojectscompleted.

5 5 17 +12 Additional interns were allocated to DESTEA by FSTDI.

1.4 Number of functional environmental information management systems(EIMS).

1 1 2 +1 GIS SPISYS system was utilized in addition to the ArcGIS system.

1.5 Number of IDPs reviewed for environmental content as per requirements (DA/3.5)

23 23 23 0 -

1.6 Submission of EIP reports.

1 1 1 0 -

1.7 Number of climate change sector policy interventions held.

- 2 2 0 -

1.8 Number of road shows conducted at municipal level relating to climate change.

7 5 5 0 -

58

4.2.2. Compliance and Enforcement

StrategicObjectivesCompliance and Enforcement

Strategicobjectives

Performance Indi-cator







Number of completed green issue criminal investigations handed to the NPA for prosecution.

- 45 26 -19 Demand driven

1.2 Number of completed brown issue criminal investigations handed to the NPA for prosecution

- 3 3 0 -

1.3 Number of administrative enforcement actions taken for non-compliance with environmental legislation.

7 10 12 +2 Demand driven

1.4 Number of compliance inspections conducted for green issues.

1275 270 800 +530 Demand driven

1.5 Number of compliance inspections conducted for brown issues.

- 80 87 +7 Demand driven

1.6 Number of permits issued within legislated time-frames.

5049 4500 4200 -300 No opportunity to demonstrate as DESTEA did not receive 4500 applications.

1.7 Number of Admission of Guilt Fines issued Biodiversity related transgressions

23 32 6 -26 Demand driven

59

4.2.3. EnvironmentalQualityManagement

StrategicObjectivesEnvironmentalQualityManagement

Strategic objectives








Number of facilities trained on the Waste Information System.

6 6 16 +10 Needs for more training wereidentifiedthrough Waste Management Forum discussions.

1.2 Percentage of waste licenses applications finalisedwithinlegislated time-frames.

80% 80% 100% +20% EMC sitting weekly instead of fortnightly, which allowed faster response times.

1.3 Number of waste pickers supported.

101 150 203 +53 Additional training requests from waste reclaimers were received and addressed through a partnership with PETCO.

1.4 Number of Waste Management OfficersForummeetings held

- 4 4 0 -

1.5 Percentage of EIA applications finalizedwithinlegislated time-frames.

68% 60% 62% +2% Due to improved internal processes and procedures.

1.6 Number of Air QualityOfficersForum meetings held.

- 4 4 0 -

1.7 Number of S24G applications finalized.

- 2 2 0 -

1.8 Number of waste landfillsitesenvironmentally audited

- 2 6 +4 As an outcome of the DESTEA MEC roadshows.

1.9 Number of cleaning campaigns conducted.

- 12 12 0 -

60

4.2.4. BiodiversityManagement

StrategicObjectivesBiodiversityManagement

Strategicobjectives








Number of new black game farmers registered in the DESTEA Game Farming Programme.

4 8 8 0 -

1.2 Number of new stewardships sites assisted to increase land under conservation through the implementation of the Biodiversity Stewardship Programme(BSP).

1 1 1 0 -

1.3 Percentage of area of state managed protected areas as-sess with a METT score above 67%.

96% 70% 100% +30% Improvement in management systems without additional costs to the organisation.

1.4 Number of hectares in the conservation estate.

920483 5000 5486 +486 Demand driven

1.5 Number of black game farmers supported through the donation of 1121 animals of various species.

- 29 0 -29 Due diligence process took longer than expected.

1.6 Provincial biodiversity plan developed and reviewed.

- 1 1 0 -

1.7 Number of new Black Game Ranchers established.


1.8 Number of mentorship sessions for black game farmers.


1.9 Number of biodiversity economy initiatives implemented.

- 2 3 +1 More human resources

61

4.2.4. BiodiversityManagement

StrategicObjectivesBiodiversityManagement

Strategicobjectives








Number of new black game farmers registered in the DESTEA Game Farming Programme.

4 8 8 0 -

1.2 Number of new stewardships sites assisted to increase land under conservation through the implementation of the Biodiversity Stewardship Programme(BSP).

1 1 1 0 -

1.3 Percentage of area of state managed protected areas as-sess with a METT score above 67%.

96% 70% 100% +30% Improvement in management systems without additional costs to the organisation.

1.4 Number of hectares in the conservation estate.

920483 5000 5486 +486 Demand driven

1.5 Number of black game farmers supported through the donation of 1121 animals of various species.

- 29 0 -29 Due diligence process took longer than expected.

1.6 Provincial biodiversity plan developed and reviewed.

- 1 1 0 -

1.7 Number of new Black Game Ranchers established.


1.8 Number of mentorship sessions for black game farmers.


1.9 Number of biodiversity economy initiatives implemented.

- 2 3 +1 More human resources

4.2.5. EnvironmentalEmpowermentServices

StrategicObjectivesEnvironmentEmpowermentServices

Strategicobjectives

Performance Indica-tor







Number of conservan-cies supported.


1.2 Number of community members’ workshopped on environmental management.

1276 380 717 +337 Demand driven

1.3 Number of registered schools for participation in an environmental programme.


1.4 Number of environmental awareness activities conducted (Community).


1.5 Number of environmental capacity building activities conducted through workshops and informal training conducted.


1.6 Number of quality environmental education resource materials developed.

1 1 3 +2 Due to partnerships with WESSA and Enviro-Quiz stakeholders

1.7 Number of environmental calendar days celebrated.

5 4 6 +2 Innovative means of celebrating calendar days

1.8 Number of Greenest and Cleanest Municipality Competitions facilitated.

1 1 3 +2 Optimisation Waste Manage-ment Forum and Air Quality man-agement Forum in increasing competitions.

1.9 Number of work opportunities created through environmental programmes(EPWP)

264 300 1253 +953 Additional fund-ing received from DEA and DESTEA funds.

1.10 Number of rivers cleaned

- 2 2 0 -

1.11 Number of towns cleaned

- 9 12 +3 Additional towns were requested by Municipalities.

62


• UtilizeexpertizeofDEAinrelationtoaspectsofenvironmentalsustainabilityand sustainable development;

• EnterintosupportprogrammeswithCUTandUNEP,includingotherindustrystake holders.



Adjusted 2017/18 Target

Quarter 1 Target

Quarter 2 Target

Quarter 3 Target

Quarter 4 Target


Number of climate change alignment policies developed.

2 0 - - - - Reprioritization of funds after 2017/18 AdjustmentBudgetAllocation.

Number of completed brown issue criminal investigations handed to the NPA for prosecution.

30 3 - - - 3 Reprioritization of funds after 2017/18 AdjustmentBudgetAllocation.

Percentage of complete EIA applications finalizedwithinlegislated time-frames.

98% 60% 60% 60% 60% 60% Reprioritization of funds after 2017/18 AdjustmentBudgetAllocation.

Number of marketing sessions for resorts conducted

4 0 - - - - Reprioritization of funds after 2017/18 AdjustmentBudgetAllocation.

Number of black game farmers supported through the donation of 1121 animals of various species

4 29 - - - 29 Reprioritization of funds after 2017/18 AdjustmentBudgetAllocation.

Number of seedlings cultivated at the Karee Nursery.

3000 0 - - - - Function has been transferred to DARD.

Number of trees planted

1000 0 - - - - Function has been transferred to DARD.

63

Linking performance with budgets

2016/2017 2017/2018Sub-ProgrammeName

Final Appropriation

ActualExpenditure

(Over)/Under Expenditure

Final Appropriation

ActualExpenditure


R’000 R’000 R’000 R’000 R’000 R’000Environmental Policy, Planning and Coordination

7,209 7,718 (509) 9,017 7,190 1,827

Compliance and Enforcement

13,170 10,996 2174 14,434 15,609 (1,175)

Environmental Quality Management

11,244 7,447 3797 22,558 23,655 (1,097)

Biodiversity Management

99,343 105,177 (5834) 78,943 80,503 (1,560)

Environmental Empowerment Services

15,476 8,150 7326 11,739 10,901 838

Total 146,442 139,488 6954 136,691 137,858 (1,167)

4.3Programme3:EconomicandSmallBusinessDevelopment

To enhance economic development, small business develop growth in the province throughfinancialandnon-financialsupportprogrammes.

Sub-Programmes:

Programme SubProgrammeEconomic Development 1. Integrated Economic Development

2. Economic Research and Planning

3. Small Business Development


•NDP:

o Chapter 3: Economy and employment

•MTSF:

o Outcome 4: Decent employment through inclusive growth

o Outcome6:Anefficient,competitiveandresponsiveinfrastructurenetwork

64

•FSGDS:

o Driver 3: Expand and diversify manufacturing opportunities

o Driver 11: Ensure social development and social security

4.3.1 IntergratedEconomicDevelopment

StrategicObjectivesIntegratedEconomicDevelopment

Strategicobjectives



Planned Target

2017/2018

Actual Achievement

2017/2018

Deviation from planned target

2017/2018


1.1 Strengthen &coordinateeconomic development.

Optimize investments.

Economic growth.

Strength strategic partnership

Number of initiatives introduced to attract investment.

- 1 1 0 -

1.2 Number of enterprises assisted with access to markets.

92 30 31 +1 DESTEA partnered with FDC and private sector.

1.3 Number of forums facilitated (cumulative)

- 1 1 0 -

1.4 Number of business supported in critical sectors

- 3 3 0 -

1.5 Numberofprojectssupported that qualify for co-funding arrangement with Developmental Funding Institutions (DFI)

- 4 12 +8 Additional funding approvals by FDC, NEF, IDC.

1.6 Number of outward and inward missions attended.

- 4 8 +4 As requested by theOfficeofthePremier.

1.7 Number of partnerships established with private sector to create relevant skills

- 2 2 0 -

1.8 Number of municipalities in which Black Business Chambers were established

- 1 1 0 -

1.9 Number of new jobopportunitiesfacilitated, with emphasis on the agro-processing sector

- 5 6 +1 Additional appointment was done during planting season which required additional labour.

65

•FSGDS:

o Driver 3: Expand and diversify manufacturing opportunities

o Driver 11: Ensure social development and social security

4.3.1 IntergratedEconomicDevelopment


Strategicobjectives



Planned Target

2017/2018

Actual Achievement

2017/2018


2017/2018


1.1 Strengthen &coordinateeconomic development.

Optimize investments.

Economic growth.

Strength strategic partnership

Number of initiatives introduced to attract investment.

- 1 1 0 -

1.2 Number of enterprises assisted with access to markets.

92 30 31 +1 DESTEA partnered with FDC and private sector.

1.3 Number of forums facilitated (cumulative)

- 1 1 0 -

1.4 Number of business supported in critical sectors

- 3 3 0 -

1.5 Numberofprojectssupported that qualify for co-funding arrangement with Developmental Funding Institutions (DFI)

- 4 12 +8 Additional funding approvals by FDC, NEF, IDC.

1.6 Number of outward and inward missions attended.

- 4 8 +4 As requested by theOfficeofthePremier.

1.7 Number of partnerships established with private sector to create relevant skills

- 2 2 0 -

1.8 Number of municipalities in which Black Business Chambers were established

- 1 1 0 -

1.9 Number of new jobopportunitiesfacilitated, with emphasis on the agro-processing sector

- 5 6 +1 Additional appointment was done during planting season which required additional labour.

4.3.2 EconomicPlanning


Strategicobjectives



Planned Target

2017/2018

Actual Achieve-ment

2017/2018


2017/2018


1.1 Exploit opportunity in critical sectors

Number of lists of Investment opportunities in5(five)priority sectors developed

- 1 1 0 -

1.2 Number of work-shops on priority sectors for district municipalities conducted

- 5 5 0 -

1.3 Promote capital investmenet

Number of lists of annual capital investment targets developed

- 1 1 0 -

1.4 ImproveR&D NumberofR&Dprojectsinitiated

- 3 4 +1 Additional capacity was received through CUT.

1.5 Economic growth Number of lists of economic growth targets developed

- 1 1 0 -

1.6 Customer satisfaction

100% of disputes resolved in 90 days

48% 100% 77% -23% Complexity of cases, extended mediations, unavailability of defending lawyers.

1.7 Promote collaborations and partnership

Number of partnerships and networks estab-lished

- 1 1 0 -

1.8 Consistant quality service provision

Number of SOPs developed

- 1 1 0 -

1.9 Job creation Number of lists of possible high impactprojectsidentified

- 1 1 0 -

1.10 Number of LED plans aligned to PEDS

- 21 21 0 -

1.11 Improve revenue collection and manage growth

Number of comparative studies on revenue collection conducted

- 1 1 0 -

66

1.12 Number of Reserves/Resorts Viability recommendation reports submitted

- 1 1 0 -

1.13 Improve prosperity Number of consumer awareness campaigns conducted

66 36 44 +8 Due to MEC’s Roadshows

1.14 Strengthen&co-ordinate economic development

Number of Provincial Economic Development Forums convened

- 4 4 0 -

1.15 Accelerate implementation and enforce accountability

Number of workshop on PEDS held

- 1 2 +1 Received additional request from the DTI to have a Provincial BIS and PEDS working session.

1.16 Improve FS Brand image

Number of World Consumer Rights Day Commemorations held

- 1 1 0 -

4.3.3. Small Business Development

StrategicObjectives

Small Business DevelopmentStrategicobjectives







1.1 Promote entrepreneurial culture

Number of economic development roadshows conducted


1.2 Strengthen&co-ordinate economic development

Number of economic development strategies developed

- 1 0 -1 Delay in due diligence to approve.

1.3 Strengthen strategic partnership

Number of strategic MoUs/SLAs signed

- 5 3 -2 Delay in due diligence to approve.

67

StrategicObjectives

Small Business DevelopmentStrategicobjectives







1.4 Increase market share

Job creation.

Fostermergers&acquisition

Be industry thought leader.

Promote entrepreneurial culture

Number of surveys conducted

- 4 7 +3 Due to the success of strategic partnerships with Municipalities and private sector

1.5 Number of SMMEs linked to big business

- 40 17 -23 Applications did not comply with BATC criteria.

1.6 Number of provincial incubators initiated

- 1 0 -1 Due to administrative delays by role-players.

1.7 Number of sector forums held

- 8 6 -2 The two forums were not held due to the International Cooperative Day preparation and hosting. Instead the task team meetings were held.

1.8 Number of enterprises developed and supported

- 12 649 +637 Due to the success of strategic partnerships with Municipalities and private sector.

1.9 Number of BBBEE workshops held

5 4 4 0 -

1.10 Number of motor mechanics and panel beaters trained

- 25 0 -25 Service provider could not provide the training before the end of the financialyear.

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Wehaveidentifiedalackofresourcesasakeycontributortounderperformanceinsomeindicators. The strategy to turn around the situation includes ensuring that we realign the structure so it can function optimally to achieve the results in an environment where there are constrained resources. To this end, we have appointed managers for the Fezile Dabi andThaboMofutsanyana Service Centres in the current financial year; this will ensurethat there is oversight and that service delivery is enhanced. Furthermore, the department hasadoptedtheuseof theBalancedScoreCard(BSC)asatool tomonitorandensureimplementation of activities and indicators as contained in the APP.

Changestoplannedtargets


Adjusted 2017/18 Target

Quarter 1Target

Quarter 2Target

Quarter 3Target

Quarter 4Target


Number of business supported in critical sectors

3 2 - - - 2 Reprioritization of funds after2017/18AdjustmentBudget Allocation.

Number of projectssupportedthat qualify for co-funding -arrangement with Developmental Funding Institutions (DFI).


NumberofR&Dprojectsinitiated

4 3 - 1 1 1 Reprioritization of funds after2017/18AdjustmentBudget Allocation.

Number of SOPs developed

3 1 1 - - - Reprioritization of funds after2017/18AdjustmentBudget Allocation.

Number of Provincial Job Summits convened

1 0 - - - - Reprioritization of funds after2017/18AdjustmentBudget Allocation.

Number of provincial incubators initiated


Number of Business Hubs established


Number of SMME Forums established at provincial and district levels


69



Final Appropriation

ActualExpenditure


Final Appropriation

ActualExpenditure

(Over)/Under

ExpenditureR’000 R’000 R’000 R’000 R’000 R’000

Integrated Economic Development

24,256 23,103 1,153 44,947 32,750 12,197

Economic Research and Planning

70,357 68,370 1,987 135,505 139,428 (3,923)

Small Business Development

19,765 21,880 (2,115) 37,715 28,897 8,818

Total 114,378 113,353 1,025 218,167 201,075 17,092

4.4. Programme4:Tourism

To ensure adequate planning, growth, development and transformation in the Tourism Industry.

Sub-programmes:

Programme SubProgrammeTourism 1. Tourism Planning

2. Tourism Growth and Development

3. Transformation of Tourism Sector


•NDP:

o Chapter 3: Economy and employment

•MTSF:

o Outcome 4: Decent employment through inclusive growth

•FSGDS:

o Driver 5: Harness and increase tourism potential and opportunities

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4.4.1. TourismPlanning

StrategicObjectivesTourismPlanning

Strategicobjec-tives




Actual Achieve-ment2017/2018



1.1 Promote collaborations &partnership.

Strengthen strategic partnerships

Improve FS brand image

Increase market share Customer satisfaction

Improve prosperity and Optimise investments

Online reservation system to be implemented.

- 1 0 -1 Lack of suitable service providers

1.2 Alignment of tourism development plans with municipalities.

- 1 1 0 -

1.3 Number of initiatives facilitated for regional integration.

- 6 6 0 -

1.4 Number of Policy Development initiative for the provincial tourism sector

- 1 0 -1 The Policy could not be developed due to the delay by NDT with the reviewed of the National Tourism Sector Strategy which was supposed to inform the Provincial Policy.

1.5 Number of tourism development research reports compiled.

- 2 1 -1 The research topics have been submitted to CUT, however only one student was able to do the research.

1.6 Number of tourism specifictrainingprovided.

- 3 1 -2 The Service Provider could not facilitate the training within the last quarter of the financial,asa result the training was cancelled.

71

4.4.2. TourismGrowthandDevelopment

StrategicObjectivesTourismGrowthandDevelopment

Strategicobjectives Performance Indicator






1.1 Increase market share

Improve prosperity

Strengthen strategic partnerships

Customer satisfaction

Improve FS brand image

Improve prosperity

Optimise investments &improve prosperity

Number of Township/Kasie tourism campaigns for township development facilitated.

- 2 2 0 -

1.2 Number of stakeholder engagements.

- 4 4 0 -

1.3 Number of linkages established with private sector for tourism development.

- 2 1 -1 Due to a delay in concluding due diligence processes.

1.4 Number of feedback reports on tourism customer survey questionnaire.

- 2 2 0 -

1.5 Number of Social Tourism initiatives facilitated at DESTEA Resorts and government-owned attractions

- 4 3 -1 Due to ad-ministrative delays by Mangaung Metro, the event could not take place.

1.6 Number of workshops conducted for tourism awareness.

- 3 3 0 -

1.7 Number of DFI initiatives supported

4 4 0 -4 MOU’s between NDT and DFI’s were completed late in the financialyear.

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4.4.3. Transformation of Tourism Sector

StrategicObjectivesTransformation of Tourism Sector

Strategicobjectives Performance Indicator



Actual Achieve-ment2017/2018



1.1 Exploit opportunities in critical sectors

Increase market share

Promote capital investment

ImproveR&D

Number of “A day in the life of a tourism enterprise” programmes conducted.

- 4 4 0 -

1.2 Number of enterprise improvement plans developed.

- 4 4 0 -

1.3 Tourism Careers Expo facilitated

1 1 1 0 -

1.4 Tourism Awards facilitated.

- 1 1 0 -


A Plan with timeframes to achieve crafting of policies will be put in place and the APP will be revised in the event that there is no funding for implementation thereof and/or when approval is taking longer to be granted due to various reasons such as public consultation.

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In Programme 4 there were no in-year changes to planned targets and indicators for the period under review. The department implemented its 2017/18 APP as tabled in legislature.



Final Appropriation

ActualExpenditure


Final Appropriation

ActualExpendi-ture


R’000 R’000 R’000 R’000 R’000 R’000

Tourism Planning 77,237 75,491 1,746 6,031 5,102 929 Tourism Growth and Development

250 - 250 1,070 3,150 (2,080)

Transformation of Tourism Sector

250 - 250 2,090 685 1,405

Total 77,737 75,491 2246 9,191 8,937 254

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5. TRANSFER PAYMENTS

5.1Transferpaymentstopublicentities

As part of the departmental transfer process, the three entities of the department provided assurancesthattheyimplementeffective,efficientandtransparentfinancialmanagementandinternal controls systems, as required by the PFMA and Treasury Regulations.

NameofPublicEntity

Servicesrenderedbythepublicentity

Amount trans-ferred to the publicentity(R’000)

Amount spent bythepublicentity (R’000)

Achievementsofthepublicentity

Free State Development Corporation

•InvestmentFacilitationand Management

•SMMEFinancing,Development and Support

•PropertyManagement-industrial, commercial and residential rental

32 260 9 465 104 SMMEs provided with promotional and/or export training programmes.

2businessventures(newandexpansion)committedwith investments above R10million.

26 SMMEs with investment commitment below R10million.

48 SMME’s were assisted with bridging loans.

61FDCcustomers(rentalandloans)assumedtobeinfinancialdistresswithpay-ment/ debt resolution plans.

33 existing and new SMMEs financiallyassisted.

75% occupancy rate of commercial and industrial properties.

•82%occupancyrateofrental property.

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Free State Gambling, Liquor and Tourism Authority

To promote legally compliant, responsible, sustainable and transformed gaming and liquor industries through effective licensing, regulating and reporting on the activities of the industries, and to position the Free State Province as a tourist destination of choice.

R112 725 R112 725 •Successfulincorporationof the Free State Tourism Authority into the Free state Gambling and Liquor authority which is now called the Free State Gambling Liquor and Tourism Authority.

•Thecompletionandimplementation of the Data base management system(DBMS)whichwill capacitate the Authority to expedite the processing of applications to enhance revenue collection.

•TheSecondRouteOperator has been licensed and is set to roll out 1000 machines in the Province and 36 sites has already been approved by the board.

•SecondeditionoftheFree state Madeira Flower festival was a huge success that has further entrenched social cohesion and encouraged the previously disadvantaged toventureintoflowerfarming.

•PowerBoathasseenanew intake of young trainees pilots who will be trained at the level of international standards.

Total R144 985 R122 190

5.2Transferpaymentstoallorganisationsotherthanpublicentities

Name of transferee

Type of organisation

Purpose for whichthefundswere

used

Did the dept. complywiths38 (1) (j) of the

PFMA

Amount trans-ferred

(R’000)

Amount spent bytheentity

(R’000)

Reasons for the funds unspentbythe entity

Free State Black Business Chamber

Business Chamber

Radical Economic Transforma-tion

Yes R5 000 R5 000 N/A - All funds were spent.

Thetablebelowreflectsthetransferpaymentswhichwerebudgetedforintheperiod1April2017 to 31 March 2018, but no transfer payments were made.

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Name of transferee

Purposeforwhichthefundsweretobeused

Amountbudgetedfor

(R’000)

Amount transferred

(R’000)

Reasonswhyfundswerenottransferred

None - - - -

6. CONDITIONAL GRANTS

6.1Conditionalgrantsandearmarkedfundspaid

GrantsandEarmarkedFunds CurrentBudget(R’000) TotalExpenditure(R’000)Conditional Grant Epwp Intergrated Grant For Prov 2,000 1,820

Total Conditional Grant 2,000 1,820EarmarkedFundsFlower Festival-Fsta 12,000 12,000

Global Trade Bridge 2,000 1,400

Tourism Promotion 4,000 4,000

Infrastructure Enhancement Alloc 13,709 13,090

RadicalEconomicTransformation(DEP) 15,000 11,572

RadicalEconomicTransformation(FDC) 15,000 15,000

MalutiSez(FDC) 4,000 4,000

Ngo Adoption 610 0

Waste Management 1,600 2,065

Es Fsgla 1,000 1,000

Smme Incubator Programme 3,590 3,404

Smme Equipment Support 1,305 1,509

Risk Sharing And Black Industrialist 7,000 7,000

Textile Fashion Support 500 419

Youth Trade Fair 281 105

Training And Roadshows In Townships 2,000 1,215

Total 83,595 77,779

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6.2Conditionalgrantsandearmarkedfundsreceived

The table below details the conditional grants and ear marked funds received during for the period 1 April 2017 to 31 March 2018.

Conditional Grant EPWP:

Department who transferred the grant National Department of Public Works

Purpose of the grant

To alleviate unemployment, delivery goods and services labour-intensively and to provide work experience and training.

Expected outputs of the grantJob creation

Actual outputs achieved1253

AmountperamendedDORA(R’000)2000

Amountreceived(R’000)2000

Reasons if amount as per DORA was not receivedNone

Amountspentbythedepartment(R’000)1820

Reasons for the funds unspent by the entityThisisduetounpaidleaveforbeneficiariesabsentfromwork.

Reasons for deviations on performancen/a

Measures taken to improve performancen/a

Monitoring mechanism by the receiving departmentTreasury Infrastructure Review Model.

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7. DONOR FUNDS

7.1 Donor Funds Receivedn/a

8. CAPITAL INVESTMENT

8.2Capitalinvestment,maintenanceandassetmanagementplan8.1.1.AssetManagementPlan

Bytheendofthefinancialyear2017/2018,thefollowingprocesseshadbeenfinalised:

•Stocktakingformachineryandequipment

•Thebarcodingofassetsandupdatingoftheroomassetslists

•Reconciliationsoftheassetssystems

•Ensuringthatallthesupportingdocumentationforassetstransactionsareinplace.

8.1.2. Infrastructure Projects

2016/2017 2017/2018Infrastructure projects Final

AppropriationActual

Expenditure


Final Appropriation

Actual

Expenditure


R’000 R’000 R’000 R’000 R’000 R’000

New and replacement assets

- - - 250 604 (354)

Existing infrastructure assets

- - - - - -

- Upgrades and additions

18 175 13 027 5 147 3 455 3 045 410

- Rehabilitation, renovations and refurbishments

- - - - - -

- Maintenance and repairs

2 274 2 232 42 9 519 9 441 78

Infrastructure transfer

- - - - - -

- Current - - - - - -- Capital - - - - - -

Total 20 449 15 259 5 189 13 224 13 090 134

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8.1.3.Planstoclosedownordown-gradeanycurrentfacility

There are no plans to close down or down-grade any of the current facilities. The department wants to renovate facilities so that they can be up-graded and be in a position where we can compete with private resorts and reserves.

8.1.4.Progressmadeonthemaintenanceofinfrastructure

8.1.4.1. General maintenance

There are no plans to close down or down-grade any of the current facilities. The department wants to renovate facilities so that they can be up-graded and be in a position where we can compete with private resorts and reserves.

8.1.4.2. Major maintenance projects

Thefollowingmajormaintenanceprojectsarereceivingattention:

•UpgradingoffenceatSandveld

8.1.5.Detailsonhowassetholdinghaschangedduringtheperiodunderreview(incl.Informationondisposals,scrappingandlosses)

Departmentalassetholding

The following changes in the departmental asset holding were observed:

The losses for the department for the period under review have been estimated at R40 000 and in all instances cases were opened with the SAPS.

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Disposals

Revenue collected for disposing scrapped assets:

•R8290forthewholeDepartment

8.1.6. Current status of capital assets

The current state of departmental capital assets in terms of percentages is as follows:

•Good: 35%

•Fair: 60%

•Bad: 5%

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PART C: GOVERNANCEPART C: GOVERNANCE

82

1. INTRODUCTIONThe Department constantly strives to improve its internal processes to ensure effectivenessandefficiencyofbusinessprocesses.Measureshavebeenputinplacetopopulariseandaddressissuessuchastheconflictofinterest,codeofconductandthe health safety environment. Below is an account of processes followed to address these issues.

2. RISK MANAGEMENTDirector Risk Management unit was seconded to Department of Health and has return to the department on the 1st March 2018. Risk Management unit was not fully effective due to absence of leadership. Since the cancellation of secondment Risk Management unit has reviewed all its relevant policies.

RiskManagementCommitteewasalsonot fully functionduring thefinancialyear,however member has been appointed and the position for the chairpersons will be advertisedduring thenewfinancialyear.Theoutgoingchairperson’scontractwasrenew and expired 31 March 2018.

The Risk Management meeting was convened where Risk Management related polices were reviewed for 2018/19.

3. FRAUD AND CORRUPTION •Thedepartment’sfraudpreventionplanandtheprogressmadeinimplementingthe

fraud prevention plan:

o Training and Awareness

o RiskIdentificationandAssessment

o Internal control and compliance

•Mechanismsinplacetoreportfraudandcorruptionandhowtheseoperate.eg:Whistleblowing-Theneedforofficialstomakeconfidentialdisclosureaboutsuspectfraudand corruption:

o Whistle Blowing Implementation Plan

o Anti-Corruption hotline

o Anti-Corruption Unit

83

•Howthesecasesarereportedandwhatactionistaken?

o HoD

o Anti-Corruption Hotline

o Public Service Commission

o Anti-Corruption Unit

o Pre-investigation

o Investigation

4. MINIMISING CONFLICT OF INTEREST AllofficialsinFinanceandSCMhavesignedthedisclosureformsanddeclaredtheirinterest.Monitoringisdoneduringthefinancialyear.

5. CODE OF CONDUCTThe Code of Conduct is an instrument that is used in the Public Service to promote and maintain a high standard of professional ethics and good governance. It serves as a guideline to all public servants in various categories, levels and controls the relations in various ways, namely:

a) The relationship with the legislature and the executive;

b) The relationship between the department and the public;

c) The relationship between the employees at different levels;

d) The performance of duties; and

e) Personal conduct and private interest.

The implementation of the code ensures that there is uniformity in the Public Service with regard to service delivery. It also improves loyalty and brings control, compliance as well as prevention of corruption.

Each employee in the department has been given a copy of Public Service Code of Conduct Manual and all newly appointed employees are given a copy of the code on the day they assume duty. The code was also thoroughly explained to the newly appointed employees during their induction. Furthermore, workshops on the Code of Conduct are always conducted biannually.

84

The Code of Conduct outlines the procedure to be followed in case of any breach of any conditions of the Code of Conduct. All instances of non-compliance with the Code of Conduct are, therefore, treated seriously by the department and, depending on the nature of misconduct, the necessary disciplinary action are taken against the perpetrators.

6. HEALTH SAFETY AND ENVIRONMENTAL ISSUES According to the Occupational Health and Safety Act no 181 of 1993, Occupational health and Safety aims “to provide for the health and safety of persons at work and for the health and safety of persons in connection with the use of plant and machinery; the protection of persons other than persons at work against hazards to health and safety arising out of or in connection with the activities of persons at work; to establish an advisory council for occupational health and safety; and to provide for matters connected therewith”.

Thefollowingaresomeoftheexamplesofrisks/hazardsthathavebeenidentifiedand addressed through this Act:

•Chemicalhazardse.g.exposuretohighorlowtemperature,highlevelofnoise,such hazard can affect your concentration or lead to a possibility to accidents.

• Physical hazards e.g.Gases, dust, high level of industrial chemicals that canpoison your body, affect lungs and the ability to breath.

•Biologicalhazardse.g.organismscanbepassedfromonepersontotheotheroranimaltoaperson(peopleworkinginabattoirswithanimalsetc.

• Mechanical hazards e.g. moving parts or energy sources a broad range ofmachineryandequipmentarehighsourceofdanger(cancausecuts,crushinjuries,amputationsandfractures).

•Ergonomichazardse.g.workingincramppositionsorspaces,poorlighting,poorseating,orstandingforlongperiod(exposuretoeyestrain,backache,wriststrainand sore shoulders.

•Behaviouralhazardse.g.non-compliancewithstandards,lackofskills,newtasks.

Employers are therefore expected to provide and maintain, as far as is reasonably possible, a working environment that is safe and without risk to the health of the employees.ThedepartmenthasestablishedanoccupationalHealthandSafety(OHS)Committee to oversee health and safety matters in the department. The members of the committee comprises of the following members:

85

Nameofofficial Designation Role WorkStation1.Ms LGB Molefe Deputy Director:EHWP Chairperson HeadOffice2.Ms T. Morabe Senior OHS Practitioner Secretary HeadOffice3. Mr S. Makhubu Reserve Assistant Member Seekoeivlei4.Mr T.D. Telane Resort Assistant Member Sterkfontein Dam5. MsT. Monareng Admin Member Qwa-Qwa Service Center6.Mr T. Sebati Reserve Assistant Member TDR7.Mr M. Jacobs Resort Assistant Member Gariep Dam8. Mr Charles Tau Reserve Assistant

Member Kalkfontein9.Mr M. Booi Reserve Assistant Member Rustfontein Dam10.Ms M.Molefe Reserve Assistant Member Karee Nursery11.Mr S. Stok Reserve Assistant Member Maria Moroka12.Mr R.J. Lesupi Reserve Assistant Member Bathurst Reserve13.Ms M. Mathopa Cleaner Member Thaba-Nchu Service Center14.Mr M. Motaung Reserve Assistant Member Caledon15. Ms B. Matlakala Resort Assistant Member Soetdoring16. Mr P.S. Mokhele Reserve Assistant Member Sandveld17.Mr S. Choloto Reserve Assistant Member Parys Service Center18. Mr S. Yekwa Reserve Assistant Member Koppies19.Mr A. Mahlomola Resort Assistant Member Willem Pretorius20.Mr T. Seisho Resort Assistant Member Erfenis21.Mr M. Lecholo Game Capture Member Bathurst22.Mr V. van Rooyen Handyman Member Construction&Maintenance23. Mr S. Ncaba Member Parys Service Centre24.MsN.Dlali(notreplaced) Resigned Member Consumer Affairs25.Mr M. Mahlasela Assistant Director Member Labour Relations26.Ms R. Namola Personal Assistant Member Conservation27.Ms R Khumalo Member HOD’soffice28.Ms M. Mbuthile DisabilityOfficer Member GenderYouth&Disability29.Ms P. Nyokong Member SBD30.Ms M. Nyawo Cleaner Member Auxiliary Services31. Ms L. Tsotetsi Member Finance32.Ms N. Khomo Officer Member Environment33. Mr M. Tollie Officer Member Asset Management34.Ms M. Maloisane SecurityOfficer Member Security Services35. Mr Seekane General Foreman Member Koppies Dam Reserve

The members of the Committee were trained on Occupational Health and Safety (OHS)Act and FirstAid Level 1 and 2.Themain responsibility of the Committeemembers is to conduct health and safety inspections at their respective workplaces. Theirfindingsare reported to theEmployeeHealthandWellnessunitwho in turnsubmit a report with recommendations to the Head of Department.

86

Healthhazardsthathavebeenidentifiedandnottimeouslyattendedto,haveanegativeimpact on the health and morale of the departmental employees. In order to minimise the risks, a certain amount of the allocated budget has been set aside to correct the identifiedhazards.Healththreateninghazardsareprioritisedinaccordancewiththeavailable budget.

7. PORTFOLIO COMMITTEES

A Portfolio Committee Meeting took place on the following dates:

•18thOctober2017for1stquarternon-financialperformanceinformation.

•16thNovember2017for2ndquarternon-financialperformanceinformation.

•16thMay2018for3rdand4thquarternon-financialperformanceinformation.

The Portfolio Committee raised the following issues during the year under review:

•Transformationofthegameindustry

•Environmentalcompliance

•Smallbusinessdevelopment

•Environmentalimpactassessmentauthorization

8. PROPAC RESOLUTIONS

Resolution No. Subject Details ResponsebytheDepartment

Status of Resolve

1

AccountingOfficermust a)Implementmeasuresto ensure that the Supply Chain Management toolkit that was rolled out by Provincial Treasury during the2015/16financialyearis used to its full potential in order to curb non-compliance with Supply Chain practices that results in Irregular expenditure or non-compliance with laws and regulations; and

To ensure that officialsaretrainedon the SCM toolkit and used to its full potential.

Completed 100%

b)Ensurestaffisnominatedfor training presented by Provincial Treasury

To ensure that officialsaretrainedon the SCM toolkit and used to its full potential.

Completed 100%

87

Resolution No. Subject Details ResponsebytheDepartment

Status of Resolve

2

AccountingOfficermustensure that Written responses provided to the Committee is submitted within the timeframe indicated by the committee; and

The department has accepted Auditor General opinion therefore the Annual Report will be tabled

The Department confirmsandwillensurethat written responses will be submitted within the required timeframes to the Committee.

100%

3

Written responses receive the necessary priority and attention to ensure that it is factually correct and complete.

The department has accepted Auditor General opinion therefore the Annual Report will be tabled

The Department confirmsthatinfuture,written responses receive the necessary priority and attention to ensure that it is factually correct and complete.

100%

AccountingOfficermust Respond to the PSC within the timeframes required by the PSC

Ensure that the Department responds to the Public Service Commission (PSC)withinthetimeframes required

There is currently no investigations by PSC that required responses. The Department will ensure that it responds to all the future investigations of the PSC within the timeframes required.

90%

9. PRIOR MODIFICATIONS TO AUDIT REPORTS

Natureofqualification,disclaimer,adverseopinionandmattersofnon-compliance

Financialyearinwhichitfirstarose

Progressmadeinclearing/resolvingthematter

Qualifiedauditopinion 2016/17 •Irregular expenditure investigated

•Misclassificationscorrected

•Expenditurereclassified

10. INTERNAL CONTROL UNIT

Internal Control functions are performed in individual sections of the Financial Management Chief Directorate. For the Financial Accounting directorate the Internal Control function is performedintermsoftheverificationandsafekeepingoffinancialtransactiondocumentation,andensuringtheavailabilityofcredibleandverifiablesupportingdocumentationforinternaland external audit purposes.

88

11. INTERNAL AUDIT AND AUDIT COMMITTEES

Keyactivitiesandobjectivesofinternalaudit

Internal audit unit is independent of management and reports administratively to the AccountingOfficerandfunctionallytotheAuditCommittee.Athreeyearriskbasedrollingstrategic and annual plans were prepared by the Internal Audit Directorate and approved by the Audit Committee. The Audit Committee is of the opinion that the control environment needs improvement to provide reasonable assurance that risks are appropriately managed and that applicable legislation is adhered to. Management has implemented corrective actions were possible to ensure controls are in place and operating as intended.

Summaryofauditworkdone

Internalaudithascompleted20auditsfor2017/18financialyearduetoanincreaseinthestaff complement of the unit.

The following internal audit work was completed during the year under review:

•2016/17DraftAnnualFinancialStatements

•2017/18InterimFinancialStatements

•2017/2018AnnualPerformancePlan

•2017/18QuarterlyTargets

•Recruitment

•FollowupauditonFleetManagement

•FollowupauditonAssetManagement

•FollowupauditonServiceCentres

•MPAT

•RiskManagement

•FollowupauditonRevenueManagement

•PayrollManagement

•ContractManagement

•Transferstopublicandprivateentities

•LeaveManagement

89

The following were areas of concern:

•Investigationonirregularexpenditure

•Incorrectevidenceonreportedquarterlytargetsachieved.

•Nonimplementationofinternalcontrols.

Management is currently working towards resolving the above areas of concern.

Key activities of the audit committee

The Audit Committee’s scope of work is determined by the requirements of Treasury Regulation3.1.10.Accordingly,and in linewith this section, theCommittee’sobjectiveswas to assess and advise, among other things, on the following matters:

•Effectivenessofinternalcontrolsystem

•Activitiesandeffectivenessactivitiesoftheinternalauditfunction,includingitsannualworkprogramme,coordinationwiththeexternalauditors,thereportsofsignificantinvestigationsandtheresponsesofmanagementtospecificrecommendations;

•RiskareasoftheDepartment’soperationsascoveredinthescopeofinternalandexternalaudits;

•Adequacy,reliabilityandaccuracyofthefinancial informationprovidedtoManagementand other users of such information; and

•Anyaccountingandauditingconcernsidentifiedasaresultofinternalandexternalaudits;

•TheDepartment’scompliancewithlegalandregulatoryprovisions.

90

12. AUDIT COMMITTEE REPORT

AuditCommitteeMembersandAttendence

The Audit Committee consists of the following members listed hereunder and met 5 times as per its approved terms of reference.

Names Qualifications Internal or External

If Internal, position in the depart-ment

Date appointed

Date resigned

No of meetingsattended

W Rooifontein

(Chairperson)

B Comm (Honours)

External Director 1 July 2017 None 05

H Mohane MSc (AgriculturalEconomics)

Mcom(Eco-nomics)

External Managing Director

1 July 2017 None 05

NB Dyeyi B Proc External Magistrate 1 July 2017 None 05

AUDIT COMMITTEE REPORT

Wearepleasedtopresentourreportforthefinancialyearended31March2018.

AuditCommitteeResponsibility

The Committee reports that it has operated and performed its oversight responsibilities independently andobjectivelyincompliancewithsection38(1)(a)ofthePFMAandTreasuryRegulations3.1.TheAudit Committee has adopted appropriate formal terms of reference in its Audit Committee Charter. The Committee has also regulated its affairs in compliance with the Charter and has discharged its responsibilities as contained therein. The Audit Committee is an advisory Committee of the Departmentoperatingwithanindependentandobjectiveoverviewrole.

The Effectiveness of Internal Control

The system of internal control applied by the Department over risk management is effective, efficientandtransparent.However,deficiencieswerenotedincontrolsincertainareasasreportedby the Internal Auditors.

91

Although issues raised by the Auditor-General involving internal controls were responded to, management still need to ensure the elimination of these matters, paying particular attention to those raised repeatedly inpreviousfinancialperiods,andtheAuditCommitteehasreviewedthemanagementCommentssinthisregards and made recommendations to further improve management control mechanisms.

From the various reports of the Internal Auditors it was noted that no further matters were reported thatindicatesmaterialdeficienciesinthesystemofinternalcontroloranydeviations.Accordingly,wecanreportthatthesystemofinternalcontrolfortheperiodunderreviewwasefficientandeffective.

In-YearManagementandMonthly/QuarterlyReport

Quarterly financial as well as non- financial reports were discussed at quarterly meetings andsubmitted to Provincial Treasury as required by the PFMA. These reports were reviewed by the Audit Committee and recommendations were implemented to improve the usefulness of the reports.

Evaluation of Financial Statements

We reviewed and discussed the following

•Thedraftannualfinancialstatementsandinformationonthepredeterminedobjectivestobe included in the in the Annual report and

•Compliancewithlegalandregulatoryprovisionsand have made certain recommendations.

Auditor General’s Report

TheAudit Committee has discussed theAuditor General’s (AG’s) report. TheAudit CommitteeconcursandacceptsAG’sconclusionsandtheannualfinancialstatementsandisoftheopinionthatthefinancialstatementsmustbereadtogetherwiththereportoftheAG.

_________________

Mr W Rooifontein

Chairperson of the Audit Committee

Department of Economic, Small Business Development, Tourism and Environmental Affairs

92

PART D: HUMAN RESOURCE MANAGEMENT

PART D: HUMAN RESOURCE MANAGEMENT

93

1. INTRODUCTION

The information contained in this part of the annual report has been prescribed by the Minister for the Public Service and Administration for all departments in the public service.

2. OVERVIEW OF HUMAN RESOURCES

Provide Commentsary on the following:

Organisationalstructure

The Department of Economic, Small Business Development of Tourism and Environment Affairs reviewed its organisational structure in an effort to have a lean and mean structure. Before embarking on that process, the current organisational structure consisted of about 1674. About 295 posts were abolished and the proposed organizational structure will consist of 1379 posts. The proposed organizational structurehasbeingsubmittedtotheOfficeofthePremierandtotheDepartmentofPublic Service and Administration to indicate if they concur with the Department.

Thefollowingpostswerejobevaluatedduringthe2017/2018financialyear:

POST JE OUTCOME

Deputy Director: Development and Funding 11

Deputy Director: OD 11

Deputy Director: Consumer Investigations 11

Assistant Director: OD 9

Assistant Director: Tourism Support Programmes 9

Assistant Director: Consumer Investigation 9

Organisational Development Practitioner 7

TourismOfficer:TourismStrategyDevelopment 7

TourismOfficer:TourismPolicyCompliance 7

TourismOfficer:RuralTourismandProductDevelopment 7

TourismOfficer:TourismSupportProgrammes 7

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TourismOfficer:TourismPolicyResearch&Development(bench-mark3posts) 7

AssistantDirector:Development&Funding 10

AssistantDirector:TourismPolicyMonitoring&Evaluation 9

Assistant Director: Tourism Policy and Strategy Development 9

AssistantDirector:TourismPolicyMonitoring&Evaluation 9

Eco-TourismClerk/ProtectedAreasClerk(Reserves/Resorts) 5

ReserveAssistant/ResortAssistant(Reserves/Resorts/Nursery) 3

Game Capturer 5

Culling Assistant 5

PermitOfficer:PermitOffice 7

•Thestatusofhumanresourcesinthedepartment.

As at 31 March 2018, the Department had a workforce of 692, this was inclusive of 675 permanent employees and 17 contract workers. In addition to the above, the department had 2 categories of employment contracts namely; Interns and Security Learners. The Department had 9 graduate interns and 19 Security Learners. Of the 9 Interns, 7 were recruited permanently in the department and the 2 remaining Interns were unsuccessful. All the 19 Security Learners were recruited permanently in the department with effect from 01 April 2018. The highest percentage of vacancy rate is as a result of unfunded vacancies in terms of the actual structure as the department recentlyfinalised leftof itsapprovedstructureonpersal.However, thedepartmenthas undertaken the process to abolish unfunded vacancies on Persal and after this exercise, 877 posts instead of 1674 will be left on Persal. This will translate to 185 poststhathavebeenprioritisedforfillingovertheMTEFperiod(2018-2020)andthevacancy rate will decrease to 21.1% as on 01 April 2018. As of 31 March 2018, one department vacancy rate was standing at 41,34%.

TheageprofileoftheDepartmentisnotofamajorconcernintermsofcriticaloccupation,however, measures needs to be put in place in order to address anticipated retirement inprogrammessuchasEnvironmentalBranchwere itwillbe losingmajorityof itsemployees.Of the692employees,190 (27.5%)arebetween theagesof18and35years(youth),87(12.6%)arebetweentheagesof36and39,198(28.6%)arebetweentheagesof40and49,181(26.15%)arebetweentheagesof50and59,36(5.2%)arebetweentheagesof60and65.Onehundredandnine(109)oftheseemployees will be retiring in the next 5-10 years through normal and/or compulsory retirement.Ofthisnumber,86(78.9%)arefromEnvironmentalManagementBranch,15(13.76%)fromAdministrationand8(1.1%)arefromEconomicDevelopment.Four(4)oftheseemployeesareonsmsandmmslevels.

95

•Humanresourceprioritiesfortheyearunderreviewandtheimpactofthese.

With the introduction of Balance Score Card, re-engineering process of the structure aswellastherelocationtonewofficeswhereinemployeesareoccupyingopenplanthanclosedoffices,thisresultedinmassivechangewithinthedepartment.As a result of these changes, the department deemed it necessary to train its employeesonchangemanagementinordertobeabletoadaptandadjustwiththe new changes.

As an ongoing process to capacitate and develop its employees, the department rolled out 14 training programmes. The training provided were able to equip employees with knowledge and skills thereby enhancing productivity in terms of service delivery. Furthermore, 30 employee were awarded part-time bursaries to studyoveraperiodoftimeinordertoincreaseapoolofqualifiedemployeesinthe department for employability.

In fillingof fundedposts, thedepartmentwasable to reduce its vacancy rateeven though it’s still at its highest. More people were employed within different units which assisted in increasing service delivery. However, more still needs to be done as the vacancy rate is still above the norm, which is 10% as per MPAT requirement.

In achieving the set employment equity target, one of the commitment made by the Honourable MEC, Dr Benny Malakoane in his 2017/18 budget vote was that the department will improve on its employment equity within the department by employment of people from designated groups. For the year under review, of the149postsfilled,26of thesepostswereonSMS(5),MMS(8)andJuniorManagement(13).Sixtyfivepercent(65%)ofthesepostsarefilledbywomenand 60% at SMS level. As at 31 March 2018, the department made progress in terms of these targets as follows: 88% for blacks, 42.48% for women, and 1.44% (ascomparedto1.15%forthe2016/17financialyearforpeoplewithdisabilities.There was progress for women at SMS level from 33.33% to 40.62% which is about 7.29% increase. The department is still experiencing challenges in terms of employment of persons with disabilities but has come up with strategies to improvethesituationinthenewfinancialyearwhenpostsareadvertised.Thedepartment lost 2 employees with disabilities as a result of ill-health retirement and transfer of function.

•Workforceplanningandkeystrategiestoattractandrecruitaskilledandcapableworkforce.

In attracting skilled and capable workforce, SMS member undergo technical exercise during the interviews where after they undergo competency assessment toidentifypotentialorgapsinacandidate.Identifiedgapsarethenincludedinthe SMS member’s Performance Development Plan to address these gaps.

96

•Employeeperformancemanagement

Fortheperiodof2017/18,majorityofemployeeshaveenteredintoperformanceagreement.Ofthe32SMSmembersthatwereinservice,31(96.9%)enteredinto performance agreement by the 31 May 2017. The reason for non-submission of one SMS member was due to the fact that he was on suspension. Currently, the department has a backlog in terms of payment of SMS outcome for the 3 pastfinancialyears.Paymentforthe2016/17forbothSMSandemployeesonsalary levels 2-12 were only approved for payment in May 2018.

From 2018/19 performance cycle, the Department of Public Service and Administration (DPSA) has introduced new directives with regard to theimplementation of the Performance Management and Development System (PMDS)foralllevelswithinthePublicServicewithaviewofimprovingefficiencyin the implementation of the new system. Trainings on the new system was provided but more workshops will be rolled out to ensure that all employees are able to implement these new directives.

•EmployeeHealthandWellnessProgrammes(EHWP)

The department have since implemented the EHWP to ensure the health and wellbeing of employees. Through this Programme, HIV Testing Services, Health Risk Assessments and different educational awareness campaigns were conducted that include commemorating different health calendar days. Affected employees were supported and infected employees were referred to different healthinstitutionsforenrolmentintheDiseaseManagementProgramme(DMP).Employees and their families were provided with counselling. Furthermore, The Occupational Health and Safety inspections were conducted to ensure the minimisation and where possible, the elimination of health hazards. Again, the EHWP also implemented the Sports and Recreation Activities. Employees were encouraged to participate in different sporting codes during wellness days.InterdepartmentalSportingtournamentsalsomarkedthefinancialyearitlobbied interest of employees with regard to sports and recreation. The EHWP also established relationships with different stakeholders to form a positive partnership that brought services to the employees.

•Highlights/achievementsandchallengesfacedbythedepartment,aswellasfuturehumanresourceplans/goals:

o Highlight/achievements:

• Thedepartmentwasable tofill149ofadvertisedpostsduring the2017/18financialyear.

•AppointmentoftheDeputyDirector:EHWPaswellasDeputyDirector:Labour

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Relations was an achievement for these components as these posts have been vacate for more than 5 years.

•SportsandRecreationactivitiesmadeanimpactinencouragingthephysicalexcercises. Interdepartmental games were held, and the relationships were established between the KwaZulu-Natal Economic Development, Tourismand Environmental Affairs, North West Department of Environmental Affairs and the Northern Cape Department of Economic Development, Tourism and Environmental Affairs.

• The departmental choir took part in the provincial interdepartmental choircompetition and was appraised with a piano.

•HostingofLongServiceAwardsceremonyonthe26September2017wherein77 long serving employees were recognised.

o Challengesfacedbythedepartment:

• The delay in appointing the service provider to render a comprehensiveEmployee Health and Wellness Programme hampers service delivery. Services that are needed include amongst others, a multilingual councelling service that is accessible to employees and their families on 24 hours basis.

• Limitedavailability ofGG transport compromiseseffective servicedelivery,especially for SHWP employers.

•MedicalSurveillanceservicesarealsonotavailabletoensureproperplacementand wellbeing of employees.

•DelayinrespondingtoinjuryondutycasesbyDepartmentofLabourwhichcompromises the services provided to employees as it affects the payment of service providers.

•Difficultyinrecruitingpeoplelivingwithdisabilities.

3. HUMAN RESOURCES OVERSIGHT STATISTICS

3.1. Personnelrelatedexpenditure

Thefollowingtablessummarisesthefinalauditedpersonnelrelatedexpenditurebyprogramme and by salary bands. In particular, it provides an indication of the following:

•amountspentonpersonnel

•amountspentonsalaries,overtime,homeowner’sallowancesand medical aid.

98

Table 3.1.1 Personnel expenditure by programme for the period 1 April 2017 and 31 March 2018

Programme TotalEx-penditure

(R’000)

Personnel Expenditure

(R’000)

TrainingExpenditure

(R’000)

Professional and Special

Services Expenditure

(R’000)

Personnel Expenditure

as a % of total expenditure

Averagepersonnel cost per

employee (R’000)

Administration 141,056 80 558 1 855 - 57 369.53


137,858 103 226 348 - 75 284.37


201,075 43 662 329 - 22 459.6

Tourism 8,937 7 803 - - 87 487.69

TOTAL 488,926 235,249 2,532 - 48 339.96

Table 3.1.2 Personnel costs by salary band for the period 1 April 2017 and 31 March 2018

Salaryband PersonnelExpendi-ture (R’000)

% of total personnel cost

No. of employees Averagepersonnelcost per employee

Contract(Levels1-2) 240 0.10 1 2 400.00Contract(Levels13-16)

3286 1.30 4 821.50

Contract(Levels3-5) 2335 0.90 7 333.57Contract(Levels6-8) 1648 0.70 6 274.67Contract(Levels9-12) 1099 0.40 3 366.33Contract Other 1583 0.60 21 75.38Highly skilled production(Levels6-8)

61 842 24.70 179 3421.34

Highly skilled supervision(Levels9-12)

69 324 27.90 120 577.70

Lowerskilled(Levels1-2)

11 544 4.60 47 245.62

Senior management (Levels13-16)

31 256 12.60 28 1 116.29

Skilled(Levels3-5) 54 536 22.00 302 180.50Other 6 747 3.00 17 396.88Total 235 249 91.8 693 339.46

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Table 3.1.3 Salaries, Overtime, Home Owners Allowance and Medical Aid by programme for the period 1 April 2017 and 31 March 2018

Programme Salaries Overtime HomeOwnersAllowance

Medical Aid

Amount (R’000

Salaries as a % of personnel costs

Amount (R’000)

Overtime as a % of personnel costs

Amount (R’000)

HOA as a % of personnel costs

Amount (R’000)

Medical aid as a % of per-sonnel costs

ADMINISTRATION 73 421 91.00 1 063 1.20 2 480 2.80 4 094 4.70ECONOMIC DE-VELOPMENT

39 276 90.00 43 0.10 1 124 2.60 1 345 3.10

ENVIRONMENTAL AFFAIRS

81 628 79.00 1 779 1.60 4 214 3.80 7 392 6.70

TOURISM 7 037 90.00 0 0.00 196 2.40 357 4.10TOTAL 201 363 86.00 2 885 0.73 8 014 2.9 13 188 4.65

Table 3.1.4 Salaries, Overtime, Home Owners Allowance and Medical Aid by salary band for the period 1 April 2017 and 31 March 2018

Salaryband Salaries Overtime HomeOwnersAllow-ance

Medical Aid

Amount (R’000

Salaries as a % of personnel costs

Amount (R’000)

Overtime as a % of personnel costs

Amount (R’000)

HOA as a % of person-nel costs

Amount (R’000)

Medical aid as a % of personnel costs

Contract (Levels1-2) 240 100.00 0 0.00 0.00 0.00 0 0.00

Contract (Levels3-5) 2 307 98.80 27 1.20 0.00 0.00 0 0.00

Contract (Levels6-8) 1 643 99.60 0 0.00 1.00 0.10 0 0.00

Contract (Levels9-12) 998 88.20 0 0.00 0.00 0.00 0.00 0.00

Contract(Lev-els>=13) 2 985 86.40 0 0.00 23.00 0.70 0.00 0.00

Contract Other 1 553 97.30 30 1.90 0.00 0.00 0.00 0.00

Lower skilled (Levels1-2) 8 160 68.10 149 1.20 976.00 8.10 1 237 10.30

Skilled(Levels3-5) 39 385 70.80 1 128 2.00 3 327 6.00 5 864 10.50

Highly skilled production (Levels6-8) 48 415 77.60 884 1.40 2 020 3.20 3 871 6.20

Highly skilled supervision (Levels9-12) 58 392 80.90 668 0.90 1 238 1.70 2 075 2.90

Senior management (Levels>=13) 27 881 83.30 0 0.00 429.00 1.30 117 0.30

Periodical Remuneration 8 620 81.70 0.00 0.00 0.00 0.00 0.00 0.00

TOTAL 201 363 86.00 2 885 0.73 8 014 2.9 13 188 4.65

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The following tables summarise the number of posts on the establishment, the number of employees, the vacancy rate, and whether there are any staff that are additional to the establishment.

This information is presented in terms of three key variables:

•programme

•salaryband

•criticaloccupations

Table 3.2.1 Employment and vacancies by programme as on 31 March 2018

Programme Numberofpostson approved establishment

Numberofpostsfilled

Vacancy Rate Numberofemployeesadditional to the establishment

Administration 463 218 85,71 2Environmental Affairs

901 363 59,71 0


265 95 64,15 0

Tourism 45 16 64,44 0Total 1674 692 58,66 2

Table 3.2.2 Employment and vacancies by salary band as on 31 March 2018

Salaryband Numberofpostsonapprovedestab-lishment

Numberofpostsfilled


Lowerskilled(1-2) 42 36 85,71 0Skilled(3-5) 714 260 36,41 0Highly skilled production(6-8)

422 168 39,81 0

Highly skilled supervision(9-12)

451 98 21,73 1

Senior management (13-16)

45 29 35,56 1

Total 1674 692 41,34 2

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Table 3.2.3 Employment and vacancies by critical occupations as on 31 March 2018

Critical occupation Numberofpostsonapprovedestab-lishment

Numberofpostsfilled


Top Management (15-16)

3 3 0 0

Senior Management (13-14)

42 29 31 1

Middle Management &Professionals(11-12)

126 42 66,66 1

Junior Management &Supervisors(8-10)

351 117 66,66 0

AdministrativeOfficeWorkers&related(5-7)

555 255 54.05 0

Elementary&SemiSkilled(1-4)

597 246 58,86 0

Total 1674 692 58,66 2

3.2 FillingofSMSPosts

The tables in this section provide information on employment and vacancies as it relates to members of the Senior Management Service by salary level. It also provides information on advertisingandfillingofSMSposts,reasonsfornotcomplyingwithprescribedtimeframesand disciplinary steps taken.

Table 3.3.1 SMS post information as on 31 March 2018

SMS Level Totalnumberof funded SMS

posts

Totalnumberof SMS posts

filled

% of SMS postsfilled


vacant

% of SMS posts vacant

Director-General/ Head of Department

1 1 100 0 0

Salary Level 16 0 0 0% 0 0Salary Level 15 2 1 50 1 50Salary Level 14 9 5 55.5 4 44.4Salary Level 13 33 24 72.7 9 27Total 45 33 78.82 14 30.4

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Table 3.3.2 SMS post information as on 30 September 2017

SMS Level Totalnumberof funded SMS

posts


filled

% of SMS postsfilled


vacant

% of SMS posts vacant

Director-General/ Head of Department

1 1 100 0 0

Salary Level 16 0 0 0% 0 0Salary Level 15 2 1 50 1 50Salary Level 14 9 5 55.5 2 44.4Salary Level 13 33 20 60,6 13 39Total 45 28 62,22 16 36.36

Table 3.3.3 Advertising and filling of SMS posts for the period 1 April 2017 and 31 March 2018

SMS Level

Advertising FillingofPostsNumberofvacanciesper level advertised in 6monthsofbecoming

vacant

Numberofvacanciesperlevelfilledin6monthsof

becomingvacant

Numberofvacanciesperlevelnotfilledin6monthsbutfilledin12

monthsDirector-General/ Head of Department

1 0 1

Salary Level 16 0 0 0Salary Level 15 1 1 0Salary Level 14 0 0 0Salary Level 13 0 0 0Total 2 1 1

Table 3.3.4 Reasons for not having complied with the filling of funded vacant SMS - Advertised within 6 months and filled within 12 months after becoming vacant for the period 1 April 2017 and 31 March 2018

Reasons for vacancies not advertised within twelve months Delay in getting approval for opening of Persal appointment function, as a result, recruitment process could notbefinalised

Reasons for vacancies not filled within six months Delay in getting approval for opening of Persal appointment function, as a result, recruitment process could notbefinalised

Notes

•IntermsofthePublicServiceRegulationsChapter1,PartVIIC.1A.3,departmentsmust indicategoodcauseorreasonfornothavingcompliedwiththefillingofSMSposts within the prescribed timeframes.

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Table 3.3.5 Disciplinary steps taken for not complying with the prescribed timeframes for filling SMS posts within 12 months for the period 1 April 2017 and 31 March 2018

Reasons for vacancies not advertised within six months

None, as the process is outside departmental control

Reasons for vacancies not filled within six monthsNone, as the process is outside departmental control

•IntermsofthePublicServiceRegulationsChapter1,PartVIIC.1A.2,departmentsmust indicate good cause or reason for not having complied with the filling ofSMS posts within the prescribed timeframes. In the event of non-compliance with this regulation, the relevant executive authority or head of department must take appropriatedisciplinarystepsintermsofsection16A(1)or(2)ofthePublicServiceAct.

3.3 JobEvaluation

Within a nationally determined framework, executing authorities may evaluate or re-evaluateanyjobinhisorherorganisation.IntermsoftheRegulationsallvacanciesonsalarylevels9andhighermustbeevaluatedbeforetheyarefilled.Thefollowingtable summarises the number of jobs that were evaluated during the year underreview. The table also provides statistics on the number of posts that were upgraded or downgraded.

Table 3.4.1 Job Evaluation by Salary band for the period 1 April 2017 and 31 March 2018

Salary band

Numberofposts on

approved es-tablishment

NumberofJobsEvaluated

% of posts evaluated bysalarybands

PostsUpgraded PostsdowngradedNumber % of posts

evaluatedNumber % of posts

evaluated

Lower Skilled (Levels1-2)

42 0 0 0 0 0 0

Skilled (Levels3-5)

714 4 0,56 0 0 0 0

Highly skilled production (Levels6-8)

422 7 1.65 0 0 0 0

Highly skilled supervision

(Levels9-12)

451 9 1.99 0 0 0 0

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Senior Manage-ment Service Band A

33 0 0 0 0 0 0

Senior Manage-ment Service Band B

9 0 0 0 0 0 0

Senior Manage-ment Service Band C

2 0 0 0 0 0 0

Senior Manage-ment Service Band D

1 0 0 0 0 0 0

Total 1674 20 1,19 0 0 0 0

The following table provides a summary of the number of employees whose positions were upgraded due to their post being upgraded. The number of employees might differ from the number of posts upgraded since not all employees are automatically absorbed into the new posts and some of the posts upgraded could also be vacant.

Table 3.4.2 Profile of employees whose positions were upgraded due to their posts being upgraded for the period 1 April 2017 and 31 March 2018

Gender African Asian Coloured White TotalFemale 25 0 3 0 28

Male 61 0 1 4 66Total 86 0 4 4 94

Employees with a disability -

The following table summarises the number of cases where remuneration bands exceeded thegradedeterminedbyjobevaluation.Reasonsforthedeviationareprovidedineachcase.

Table 3.4.3 Employees with salary levels higher than those determined by job evaluation by occupation for the period 1 April 2017 and 31 March 2018

Occupation Numberofemploy-ees

Jobevaluationlevel

Remuneration level Reason for deviation

Deputy Director: Salaries

1 11 13 Retention of employee’s salary

Deputy Director: Asset and Disposal

1 11 12 Retention in terms of Public Service Regulations

Assistant Director: Youth Development

1 10 12 Retention of employee’s salary

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PMDS Practitioner 2 7 8 Transfer with the retention ofsalary(benchmarkofpreviouspost)

System Analyst 1 8 9 Retention in terms of Public Service Regulations

ASD:LejweleputswaService Centre

1 9 12 Transfer with the retention of salary

Property Admin Officer


Deputy Director: Tourism Product Development


Trade Advisor: LejweleputswaService Centre


Labour Relations Officer

2 7 8 Lowering of salary level as a result of benchmark

Trade Advisor: BBBE


Accounting Clerk 5 5 6 Lowering of salary level as a result of benchmark

Assistant Director: Physical&Information Security


Totalnumberofemployeeswhosesalariesexceededtheleveldeterminedbyjobevaluation

19

Percentageoftotalemployed 2.7%

Thefollowingtablesummarisesthebeneficiariesoftheaboveintermsofrace,gender,and disability.

Table 3.4.4 Profile of employees who have salary levels higher than those determined by job evaluation for the period 1 April 2017 and 31 March 2018

Gender African Asian Coloured White TotalFemale 10 0 0 0 10Male 9 0 0 0 9Total 19 0 0 0 19

EmployeeswithadisabilityEmployeeswithadisability

1 0 0 0 1

Notes

•Iftherewerenocaseswherethesalarylevelswerehigherthanthosedeterminedbyjob

evaluation, keep the heading and replace the table with the following:

Total number of Employees whose salaries exceeded the gradesdeterminebyjobevaluation

19

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3.5 EmploymentChanges

This section provides information on changes in employment over the financialyear.Turnoverratesprovideanindicationoftrendsintheemploymentprofileofthedepartment. The following tables provide a summary of turnover rates by salary band andcriticaloccupations(seedefinitioninnotesbelow).

Table 3.5.1 Annual turnover rates by salary band for the period 1 April 2017 and 31 March 2018

Salary Band Numberofemployees at beginningof

period-April2017

Appointments and transfers into the

department

Terminations and transfers out of the department

Turnover rate

Lowerskilled(Levels1-2) 234 24 9 3.8Skilled(Levels3-5) 96 51 25 26Highly skilled production (Levels6-8)

211 42 15 14.2

Highly skilled supervision (Levels9-12)

36 25 6 35.2

Senior Management Service Bands A

23 4 2 17

Senior Management Service Bands B

5 1 1 40

Senior Management Service Bands C

2 2 0 0

Senior Management Service Bands D

1 0 1 100

Contracts 34 0 34 100

Total 642 149 92 14.3

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Table 3.5.2 Annual turnover rates by critical occupation for the period 1 April 2017 and 31 March 2018

Critical Occupation Numberofemployees at beginningofperiod-April 2017

Appointments and transfers into the department

Terminations and transfers out of the department

Turnover rate


3 2 1 33


27 5 2 7.4

Middle Management &Professionals(11-12)

35 7 1 2.9


110 18 13 11.8

AdministrativeOfficeWorkers&related(5-7)

186 42 22 11.8

Elementary&SemiSkilled(1-4)

281 75 53 18.7

TOTAL 642 149 92 14.3

Thetablebelowidentifiesthemajorreasonswhystaffleftthedepartment.

Table 3.5.3 Reasons why staff left the department for the period 1 April 2017 and 31 March 2018

Termination Type Number %ofTotalResignationsDeath 4 4.4Resignation 14 15.2Expiry of contract 34 37Dismissal – operational changes 0 0Dismissal – misconduct 0 0Dismissal–inefficiency 0 0Discharged due to ill-health 2 2.2Retirement 12 13Transfer to other Public Service Departments

26 28.3

Other 0 0Total 0 0Totalnumberofemployeeswholeft as a % of total employment

92 100

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Table 3.5.4 Promotions by critical occupation for the period 1 April 2017 and 31 March 2018

Occupation Employees 1 April 2017

Promotions to another salary

level

Salary level promotions as a % ofemployeesby

occupation

Progressionstoanother notch withinasalary

level

Notch progressionasa% of employees byoccupation


3 2 66 0 0


27 2 7.4 0 0

Middle Management&Professionals (11-12)

35 3 8.6 0 0


110 9 8.2 0 0

Administrative OfficeWorkers&related(5-7)

186 5 2.7 0 0

Elementary&Semi Skilled (1-4)

281 4 1.4 0 0

TOTAL 642 25 3.9 0 0

Table 3.5.5 Promotions by salary band for the period 1 April 2017 and 31 March 2018

Salary Band Employees 1 April 2017

Promotions to another salary

level

Salarybandspromotions as a % ofemployeesby

salary level

Progressionstoanother notch withinasalary

level

Notchprogressionas a % of

employeesbysalarybands


207 0 0 0 0

Skilled(Lev-els3-5)

96 7 7.3 0 0


211 2 0.9 0 0


98 12 12 0 0

Senior Management (Level13-16)

30 4 13 0 0

Total 642 25 3.9 0 0

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3.6 EmploymentEquity

Table 3.6.1 Total number of employees (including employees with disabilities) in each of the following occupational categories as on 31 March 2018

Occupational category

Male Female Total

African Coloured Indian White African Coloured Indian WhiteLegislators, senior officialsandmanagers

36 2 0 7 27 1 1 0 74

Profession-als

1 0 0 4 3 0 0 1 9

Technicians and associ-ate profes-sionals

37 4 0 29 40 0 0 7 117

Clerks 116 4 0 6 119 1 0 8 254Service and sales work-ers

0 0 0 0 0 0 0 0 0

Skilled agriculture andfisheryworkers

0 0 0 0 0 0 0 0 0

Craft and re-lated trades workers

0 0 0 0 0 0 0 0 0

Plant and machine operators and assem-blers

0 0 0 0 0 0 0 0 0

Elementary occupa-tions

148 6 0 1 79 4 0 0 238

Total 338 16 0 47 268 6 1 16 692Employees withdis-abilities

7 0 0 1 2 0 0 0 10

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Table 3.6.2 Total number of employees (including employees with disabilities) in each of the following occupational bands as on 31 March 2018

Occupational Band

Male Female

African Coloured Indian White African Coloured Indian White TotalTop Management

6 0 0 0 1 0 1 0 8

Senior Management

11 0 0 2 11 0 0 0 24

Professionally qualifiedandexperienced specialists and mid-management

18 2 0 5 15 1 0 1 42

Skilled technical and academically qualifiedworkers,juniormanagement, supervisors, foreman and superintendents

39 4 0 33 42 0 0 8 126

Semi-skilled and discretionary decision making

116 4 0 6 119 1 0 8 254

Unskilled and defineddecisionmaking

148 6 0 1 83 4 0 0 238

Total 338 16 0 47 271 6 1 17 692Employees withdisabilities

7 0 0 1 2 0 0 0 10

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Table 3.6.3 Recruitment for the period 1 April 2016 and 31 March 2018

Occupational Band

Male Female

African Coloured Indian White African Coloured Indian White TotalTop Management 2 0 0 0 0 0 1 0 3Senior Management

3 0 0 0 2 0 0 0 4

Professionally qualifiedandexperienced specialists and mid-management

2 0 0 0 4 1 0 0 7

Skilled technical and academically qualifiedworkers,juniormanagement, supervisors, foreman and superintendents

8 0 0 1 8 0 0 0 17


18 2 0 0 29 0 0 0 49


39 2 0 0 28 0 0 0 69

Total 67 4 0 1 67 1 1 0 149Employeeswithdisabilities

1 0 0 1 0 0 0 0 2

Table 3.6.4 Promotions for the period 1 April 2017 and 31 March 2018

Occupational Band Male FemaleAfrican Coloured Indian White African Coloured Indian White Total

Top Management 1 0 0 0 0 0 1 0 2

Senior Management 1 0 0 0 1 0 0 0 2Professionally qualifiedandexperienced specialists and mid-management

2 0 0 0 1 0 0 0 3

Skilled technical and academically qualifiedworkers,juniormanagement,supervisors, foreman and superintendents

4 0 0 1 4 0 0 0 9


4 0 0 0 1 0 0 0 5

Unskilledanddefineddecision making

2 0 0 0 2 0 0 0 4

112

Occupational Band Male FemaleAfrican Coloured Indian White African Coloured Indian White Total

Total 14 0 0 1 8 0 0 0 25Employees with disabilities

0 0 0 1 0 0 0 0 1

Table 3.6.5 Terminations for the period 1 April 2017 and 31 March 2018

Occupational Band

Male Female

African Coloured Indian White African Coloured Indian White TotalTop Management 1 0 0 0 0 0 0 0 2Senior Management 1 0 0 0 0 0 0 0 1Professionally qualifiedandexperienced specialists and mid-management

0 0 0 0 1 0 0 0 1

Skilled technical and academically qualifiedworkers,juniormanagement,supervisors, foreman and superintendents

3 0 0 1 5 0 0 0 9


10 0 0 1 9 1 0 1 22


21 0 0 1 12 0 0 0 34

Total 36 0 3 27 1 0 66EmployeeswithDisabilities

0 0 0 0 1 0 0 0 1

Table 3.6.6 Disciplinary action for the period 1 April 2017 and 31 March 2018

Disciplinary action

Male Female TotalAfrican Coloured Indian White African Coloured Indian White

Written warning

0 0 0 0 0 0 0 0 0

Final Written warning

1 0 0 1 0 0 0 0 2

113

Table 3.6.7 Skills development for the period 1 April 2017 to 31 March 2018


Male FemaleAfrican Coloured Indian White African Coloured Indian White Total

Legislators, senior officialsandmanagers

36 2 0 7 27 1 1 0 74

Professionals 1 0 0 4 3 0 0 1 9Technicians and associate professionals

37 4 0 29 40 0 0 7 117

Clerks 121 4 0 6 123 1 0 8 263Service and sales workers 0 0 0 0 0 0 0 0 0

Skilled agriculture andfisheryworkers 0 0 0 0 0 0 0 0 0

Craft and related trades workers 0 0 0 0 0 0 0 0 0

Plant and machine operators and assemblers

0 0 0 0 0 0 0 0 0

Elementary occupations 148 6 0 1 79 4 0 0 238

Total 156 6 0 12 149 1 0 0 618Employeeswithdisabilities

0 0 0 0 0 0 0 0 0

3.7 SigningofPerformanceAgreementsbySMSMembers

AllmembersoftheSMSmustconcludeandsignperformanceagreementswithinspecifictimeframes. Information regarding the signing of performance agreements by SMS members, the reasons for not complying within the prescribed timeframes and disciplinary steps taken is presented here.

Table 3.7.1 Signing of Performance Agreements by SMS members as on 31 May 2018

SMS Level Totalnumberoffunded SMS posts

TotalnumberofSMSmembers

Totalnumberofsignedperformance

agreements

Signedperformanceagreementsas%oftotalnumberofSMSmembers

Director-General/ Head of Depart-ment

1 1 1 100

Salary Level 16 1 1 1 100Salary Level 15 2 1 1 50Salary Level 14 7 5 5 100Salary Level 13 28 24 23 95.8Total 38 32 31 96.9

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Table 3.7.2 Reasons for not having concluded Performance agreements for all SMS members as on 31 March 2018

Reasons One SMS member was on suspension

Table 3.7.3 Disciplinary steps taken against SMS members for not having concluded Performance agreements as on 31 March 2018

Reasons One SMS member was on suspension

3.8 PerformanceRewards

To encourage good performance, the department has granted the following performance rewards during the year under review. The information is presented in terms of race, gender, disability,salarybandsandcriticaloccupations(seedefinitioninnotesbelow).

Table 3.8.1 Performance Rewards by race, gender and disability for the period 1 April 2017 and 31 March 2018

Race and Gender

BeneficiaryProfile CostNumberofben-

eficiariesNumberofemployees

% of total withingroup

Cost (R’000) Averagecostperemployee

African 0 0 0 0 0 Male 0 0 0 0 0 Female 0 0 0 0 0Asian 0 0 0 0 0 Male 0 0 0 0 0 Female 0 0 0 0 0Coloured 0 0 0 0 0 Male 0 0 0 0 0 Female 0 0 0 0 0White 0 0 0 0 0 Male 0 0 0 0 0 Female 0 0 0 0 0Total 0 0 0 0 0

115

Table 3.8.2 Performance Rewards by salary band for personnel below Senior Management Service for the period 1 April 2017 to 31 March 2018

Salaryband

BeneficiaryProfile Cost Total cost as a % of the total

personnel expenditure

Numberofbeneficiaries

Numberofemployees

% of total withinsalary

bands

Total Cost (R’000)

Averagecostper employee

Lower Skilled (Levels1-2)

0 0 0 0 0 0

Skilled(level3-5)

0 0 0 0 0 0

Highly skilled production (level6-8)

0 0 0 0 0 0

Highly skilled supervision (level9-12)

0 0 0 0 0 0

Total 0 0 0 0 0 0

Table 3.8.3 Performance Rewards by critical occupation for the period 1 April 2017 to 31 March 2018

Critical occupation

BeneficiaryProfile CostNumberofbeneficiaries

Numberofem-ployees

%oftotalwithinoccupation


Averagecostperemployee


0 0 0 0 0

Technicians and associate professionals

0 0 0 0 0

AdministrativeOfficeWorkers

0 0 0 0 0

Elementary occupations 0 0 0 0 0Total 0 0 0 0 0

116

Table 3.8.4 Performance related rewards (cash bonus), by salary band for Senior Management Service for the period 1 April 2017 to 31 March 2018

Salaryband

BeneficiaryProfile Cost Total cost as a % of the total personnelexpen-diture

Numberofben-eficiaries

Numberofemployees

% of total withinsalary

bands


Averagecost per

employee

Band A 0 0 0 0 0 0Band B 0 0 0 0 0 0Band C 0 0 0 0 0 0Band D 0 0 0 0 0 0Total 0 0 0 0 0 0

3.9 The tables below summarise the employment of foreign nationals in the department in termsofsalarybandandmajoroccupation.

Table 3.9.1 Foreign workers by salary band for the period 1 April 2017 and 31 March 2018

Salary Band 01 April 2016 31 March 2017 ChangeNumber % of total Number % of total Number %Change

Lower skilled 0 0 0 0 0 0Highly skilled production (Lev.6-8)

0 0 0 0 0 0

Highly skilled supervision (Lev.9-12)

0 0 0 0 0 0

Contract(level9-12) 0 0 0 0 0 0Contract(level13-16) 0 0 0 0 0 0Total 0 0 0 0 0 0

Table 3.9.2 Foreign workers by major occupation for the period 1 April 2017 and 31 March 2018

Major occupation 01 April 2017 31 March 2018 ChangeNumber % of total Number % of total Number %Change

None

3.10. Leave utilisation

ThePublicServiceCommissionidentifiedtheneedforcarefulmonitoringofsickleavewithinthe 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.

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Table 3.10.1 Sick leave for the period 1 January 2017 to 31 December 2017

Salary Band Total days %DayswithMedicalcertifi-

cation

NumberofEmployees usingsick

leave

% of total employees usingsick

leave

Averagedaysper employee days/numberof

employees

Estimated Cost (R’000)

Lower Skills (Level1-2)

403 26.40 41 100 10 152

Skilled(levels3-5)

1291 43.68 185 58.9 7 698

Highly skilled production (levels6-8)

693 9.43 100 54.6 12.9 670

Highly skilled supervision (levels9-12)

534 12.24 73 59.8 7.3 105

Top and Senior management (levels13-16)

84 77.85 13 40.6 15.5 348

Total 3005 33.92 419 60.5 52.7 1973

Table 3.10.2 Disability leave (temporary and permanent) for the period 1 January 2017 to 31 December 2017

Salary Band Total days %DayswithMedicalcertifi-

cation

NumberofEmployees usingsick

leave

% of total employees usingsick

leave

Averagedays per employee

Estimated Cost

(R’000)

Lower skilled (Levels1-2)

48 100 3 7.3 16 18

Skilled(Levels3-5)

53 100 7 1.9 13 27


129 100 4 2.1 3 117


14 100 1 0.8 7 21


0 100 0 0 0 0

Total 244 100 15 2.1 6 183

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The table below summarises the utilisation of annual leave. The wage agreement concluded with 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.

Table 3.10.3 Annual Leave for the period 1 January 2017 to 31 December 2017

Salaryband Totaldaystaken NumberofEmployeesus-ingannualleave

Averageperemployee


1 331 64 20.8

SkilledLevels3-5) 6 609 269 24.6Highly skilled production(Levels6-8)

3 425 151 22.7


2 461 108 22.8


510 25 20.4

Total 14 336 617 23.3

Table 3.10.4 Capped leave for the period 1 January 2017 to 31 December 2017

Salaryband Total days of cappedleavetaken

NumberofEm-ployeesusingcapped leave

Averagenumberofdaystakenper

employee

Averagecappedleave per employee as on 31 March 2017

Lowerskilled(Levels1-2) 4.98 1 4.9 18.5SkilledLevels3-5) 26 5 5.2 23.4Highly skilled production (Levels6-8)

5 1 5 29.2


1 1 1 50.3


0 0 0 32.3

Total 36.98 8 16.1 29.6

The following table summarise payments made to employees as a result of leave that was not taken.

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Table 3.10.5 Leave pay-outs for the period 1 April 2017 and 31 March 2018

Reason Total amount (R’000) Numberofemployees Averageperemployee(R’000)

Leave pay-out for 2014/15 due to non-utilisation of leave for the previous cycle

235 8 29

Capped leave pay-outs on termination of service for 2016/17

96 9 11

Current leave pay-out on termination of service for 2016/17

490 21 23

Total 821 38 21

3.11. HIV/AIDS&HealthPromotionProgrammes

Table 3.11.1 Steps taken to reduce the risk of occupational exposure

Units/categories of employees identified to be at highriskofcontractingHIV&relateddiseases(ifany)

Keystepstakentoreducetherisk

1. Game Capture Education and awareness sessions

First Aid training

Condom distribution and demonstration

Providing PPE

Counselling and emotional support2. Cleaners Education and awareness sessions

First Aid training

Provide PPE


Counselling and emotional support3. Employees residing at Resorts and Reserves Education and awareness session

First Aid training

Provide PPE


Counselling and emotional support4. Contraction and Maintenance Team Education and awareness sessions

First Aid training

Provide PPE


Counselling and emotional support

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5. EPWP Contractors Education and awareness sessions

Provide PPE

First Aid training


Counselling and emotional support6. Learnerships Education and awareness sessions

First Aid training

Provide PPE


Counselling and emotional support

Table 3.11.2 Details of Health Promotion and HIV/AIDS Programmes (tick the applicable boxes and provide the required information)

Question Yes No Details, if yes1. 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, provideher/his name and position.

Yes Acting Director: OHRD

2. Does the department have a dedi-cated unit or has it designated spe-cific staff members to promote thehealth and well-being of your em-ployees?Ifso,indicatethenumberof employees who are involved in this task and the annual budget that is available for this purpose.

Yes Five employees are appointed for the task

Allocated budget wasR1.1m

3. Has the department introduced an Employee Assistance or Health Promotion Programme for your em-ployees?Ifso,indicatethekeyele-ments/services of this Programme.

Yes The EHWP implements the four pillars that includes Health and Productivity, HIV/AIDS Management, Wellness Management and Occupational Health and Safety.

4. Has the department established (a)committee(s)ascontemplatedinPartVIE.5 (e)ofChapter1of thePublicServiceRegulations,2001?Ifso, please provide the names of the members of the committee and the stakeholder(s)thattheyrepresent.

Yes The EHWP committee was appointed

5. Has the department reviewed its employment policies and practices to ensure that these do not unfairly discriminate against employees on thebasisof theirHIVstatus?Ifso,list the employment policies/prac-tices so reviewed.

Yes HIV Policies are in place, EE Act is also implemented

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Question Yes No Details, if yes6. Has the department introduced measures to protect HIV-positive employees or those perceived to be HIV-positive from discrimination? Ifso, list the key elements of these measures.

Yes Policies are in place and are implement-ed. Information sessions are conducted to educate employees

7. Does the department encour-age its employees to undergo Vol-untary Counselling and Testing? Ifso, list the results that you have you achieved.

Yes HTS and HRA campaigns are conducted every six months. The services are brought to the workplace to ensure accessibility to services

8. Has the department developed measures/indicators to monitor &evaluate the impact of its health pro-motionprogramme?Ifso,listthesemeasures/indicators.

Yes DPSA monitors the EHW Programme

Question Yes No Details, if yes1. 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, provideher/his name and position.

Yes Acting Director: OHRD

2. Does the department have a dedi-cated unit or has it designated spe-cific staff members to promote thehealth and well-being of your em-ployees?Ifso,indicatethenumberof employees who are involved in this task and the annual budget that is available for this purpose.

Yes Five employees are appointed for the task

Allocated budget wasR1.1m

3. Has the department introduced an Employee Assistance or Health Promotion Programme for your em-ployees?Ifso,indicatethekeyele-ments/services of this Programme.

Yes The EHWP implements the four pillars that includes Health and Productivity, HIV/AIDS Management, Wellness Management and Occupational Health and Safety.

4. Has the department established (a)committee(s)ascontemplatedinPartVIE.5 (e)ofChapter1of thePublicServiceRegulations,2001?Ifso, please provide the names of the members of the committee and the stakeholder(s)thattheyrepresent.

Yes The EHWP committee was appointed

5. Has the department reviewed its employment policies and practices to ensure that these do not unfairly discriminate against employees on thebasisof theirHIVstatus?Ifso,list the employment policies/prac-tices so reviewed.

Yes HIV Policies are in place, EE Act is also implemented

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Question Yes No Details, if yes6. Has the department introduced measures to protect HIV-positive employees or those perceived to be HIV-positive from discrimination? Ifso, list the key elements of these measures.

Yes Policies are in place and are implemented. Information sessions are conducted to educate employees

7. Does the department encour-age its employees to undergo Vol-untary Counselling and Testing? Ifso, list the results that you have you achieved.

Yes HTS and HRA campaigns are conducted every six months. The services are brought to the workplace to ensure accessibility to services

8. Has the department developed measures/indicators to monitor &evaluate the impact of its health pro-motionprogramme?Ifso,listthesemeasures/indicators.

Yes DPSA monitors the EHW Programme

3.12 LabourRelations

Table 3.12.1 Collective agreements for the period 1 April 2017 and 31 March 2018

Subjectmatter DateNone

Notes

•Iftherewerenoagreements,keeptheheadingandreplacethetablewiththefollowing:

TotalnumberofCollectiveagreements 0

The following table summarises the outcome of disciplinary hearings conducted within the department for the year under review.

Table 3.12.2 Misconduct and disciplinary hearings finalised for the period 1 April 2017 and 31 March 2018

Outcomes of disciplinary hearings Number % of totalCorrectional counselling 0 0Verbal warning 0 0Written warning 0 0Final written warning 1 50Suspended without pay 1 50Fine 0 0

123

Demotion 0 0

Dismissal 0 0Not guilty 0 0Case withdrawn 0 0Total 2 100

Table 3.12.3 Types of misconduct addressed at disciplinary hearings for the period 1 April 2017 and 31 March 2018

Type of misconduct Number % of totalTheft - -Performing remunerative work 1 4.5Insubordination 20 91Absenteeism 1 4.5TOTAL 22 100

Table 3.12.3.1 Total misconduct cases for the period 1 April 2017 - 31 March 2018

Type of misconduct Numberofcasesoutstanding01

April 2017

Numberofcases added in

2017/18

Numberofcasesfinalisedin

2017/18

NumberofCasesoutstanding31

March 2018Performing remunerative work

1 0 1 0

Insubordination 6 3 1 8Absenteeism 0 1 0 1Fraud 10 0 0 10

TOTAL 17 4 2 19

Table 3.12.4 Grievances lodged for the period 1 April 2017 and 31 March 2018

Grievances Number % of TotalNumber of grievances resolved 34 100Number of grievances not resolved 0 0Totalnumberofgrievanceslodged 34 100

Table 3.12.5 Disputes logged with Councils for the period 1 April 2017 and 31 March 2018

Disputes Number % of TotalNumber of disputes upheld 4 17.4Number of disputes dismissed 19 82.6Totalnumberofdisputeslodged 23 100

124

Table 3.12.6 Strike actions for the period 1 April 2017 and 31 March 2018

Totalnumberofpersonsworkingdayslost 0Totalcostsworkingdayslost 0Amountrecoveredasaresultofnoworknopay(R’000) 0

Table 3.12.7 Precautionary suspensions for the period 1 April 2017 and 31 March 2018

Number of people suspended 8Numberofpeoplewho’ssuspensionexceeded30days 7Averagenumberofdayssuspended 400Cost of suspension(R’000) 4 870

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3.13 Skillsdevelopment

This section highlights the efforts of the department with regard to skills development.

Table 3.13.1 Training needs identified for the period 1 April 2017 and 31 March 2018


Gender Numberofemployees as at 1 April

2017

TrainingneedsidentifiedatstartofthereportingperiodLearnerships Skills

Programmes&othershort

courses

Other forms oftraining

Total


Female 44 0 4 0 4Male 79 0 0 0 0

Professionals Female 1 0 0 0 0Male 4 0 0 0 0


Female 4 0 1 0 1Male 4 0 0 0 0

Clerks Female 125 0 5 0 5Male 100 0 0 0 0

Service and sales workers

Female 0 0 0 0 0Male 0 0 0 0 0


Female 0 0 0 0 0Male 0 0 0 0 0

Craft and related trades workers

Female 0 0 0 0 0Male 0 0 0 0 0


Female 0 0 0 0 0Male 0 0 0 0 0

Elementary occupations

Female 87 0 8 0 8Male 194 0 0 0 0

Sub Total Female 261 0 18 0 18Male 381 0 0 0 0

Total 642 0 18 0 18

126

Table 3.13.2 Training provided for the period 1 April 2017 and 31 March 2018


Gender Numberofemployees as at 1 April

2017

TrainingprovidedwithinthereportingperiodLearnerships SkillsProgrammes&

other short coursesOther forms of

trainingTotal


Female 44 0 3 0 3Male 79 0 0 0 0

Professionals Female 1 0 0 0 0Male 4 0 0 0 0


Female 4 0 1 0 1Male 4 0 0 0 0

Clerks Female 125 0 7 0 7Male 100 0 0 0 0

Service and sales workers

Female 0 0 0 0 0Male 0 0 0 0 0


Female 0 0 0 0 0Male 0 0 0 0 0

Craft and related trades workers

Female 0 0 0 0 0Male 0 0 0 0 0


Female 0 0 0 0 0Male 0 0 0 0 0

Elementary occupations

Female 87 0 6 0 6Male 194 0 0 0 0

Sub Total Female 261 0 0 0 0Male 381 0 0 0 0

Total 642 0 17 0 17

3.14 Injury on duty

Thefollowingtablesprovidebasicinformationoninjuryonduty.

Table 3.14.1 Injury on duty for the period 1 April 2017 and 31 March 2018

Natureofinjuryonduty Number % of totalRequired basic medical attention only 25 3.6Temporary Total Disablement 1 0.14Permanent Disablement 0 0Fatal 0 0Total 26 3.76

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3.15 Utilisation of Consultants

The following tables relates information on the utilisation of consultants in the department. In terms ofthePublicServiceRegulations“consultant’meansanaturalorjuristicpersonorapartnershipwhoorwhichprovidesintermsofaspecificcontractonanadhocbasisanyofthefollowingprofessional services to a department against remuneration received from any source:

(a) The rendering of expert advice;

(b) Thedraftingofproposalsfortheexecutionofspecifictasks;and

(c) Theexecutionofaspecifictaskwhichisofatechnicalorintellectualnature,but excludes an employee of a department.

- TheDepartmentdidnotappointconsultantsfortheperiodunderreview.

Table 3.15.1 Report on consultant appointments using appropriated funds for the period 1 April 2017 and 31 March 2018

Project title Totalnumberofconsultantsthatworkedonproject

Duration(workdays)

Contract value inRand

None N/A N/A N/A

Totalnumberofprojects

Total individual consultants Total duration

Workdays

Total contract value in Rand

None N/A N/A N/A

Table 3.15.2 Analysis of consultant appointments using appropriated funds, in terms of Historically Disadvantaged Individuals (HDIs) for the period 1 April 2017 and 31 March 2018

Project title PercentageownershipbyHDIgroups

PercentagemanagementbyHDI

groups

NumberofconsultantsfromHDIgroupsthatwork

on the projectNone N/A N/A N/A

128

Table 3.15.3 Report on consultant appointments using Donor funds for the period 1 April 2017 and 31 March 2018

Project title TotalNumberofconsultantsthatworkedonproject

Duration(Workdays)

Donor and contract value in Rand

None N/A N/A N/A

Totalnumberofprojects

Total individual consultants Total durationWorkdays

Total contract value in Rand

None N/A N/A N/A

Table 3.15.4 Analysis of consultant appointments using Donor funds, in terms of Historically Disadvantaged Individuals (HDIs) for the period 1 April 2017 and 31 March 2018

Project title PercentageownershipbyHDIgroups

PercentagemanagementbyHDI

groups

NumberofconsultantsfromHDIgroupsthatworkonthe

projectN/A

3.16 SeverancePackages

Table 3.16.1 Granting of employee initiated severance packages for the period 1 April 2017 and 31 March 2018

Salaryband Numberofapplications received

Numberofapplications referred

to the MPSA

Numberofapplications

supportedbyMPSA

Numberofpackages

approvedbydepartment


0 0 0 0

SkilledLevels3-5) 0 0 0 0Highly skilled production(Levels6-8)

0 0 0 0


0 0 0 0


0 0 0 0

Total 0 0 0 0

129

PART E: FINANCIAL INFORMATION

130

Reportoftheauditor-generaltotheFreeStateLegislatureonVoteno.3: Department of Economic, Small Business Development, Tourism and Environmental Affairs

Report on the audit of the financial statements

Qualifiedopinion

1. IhaveauditedthefinancialstatementsoftheDepartmentofEconomic,SmallBusinessDevelopment, Tourism and Environmental Affairs set out on pages 140 to 223, which comprise theappropriationstatement,thestatementoffinancialpositionasat31March2018,thestatementoffinancialperformance,statementofchangesinnetassetsandcashflowstatementfortheyearthenended,aswellasthenotestothefinancialstatements,includingasummaryofsignificantaccountingpolicies.

2. Inmyopinion,exceptforthepossibleeffectsofthemattersdescribedinthebasisforqualifiedopinionsectionofthisauditor’sreport,thefinancialstatementspresentfairly,inallmaterialrespects,thefinancialpositionoftheDepartmentofEconomic,SmallBusinessDevelopment,TourismandEnvironmentalAffairsasat31March2018,anditsfinancialperformanceandcashflowsfortheyearthenendedinaccordancewiththeModifiedCashStandard(MCS)prescribed by the National Treasury and the requirements of the Public Finance Management ActofSouthAfrica,1999(ActNo.1of1999)(PFMA)andtheDivisionofRevenueActofSouthAfrica,2017(ActNo.3of2017)(Dora).

Basisforqualifiedopinion

Goods and services

3. Iwasunabletoobtainsufficientappropriateauditevidenceforexpenditurerelatingtogoodsandservices.Thiswasduetotheunavailabilityofsupportingdocumentationtoconfirmthatthe goods and services for the national tourism career expo incurred in the current year and the micro-enterprises support programme incurred in the prior year had actually been received andcorrectlyaccountedfor.Iwasunabletoconfirmtheexpenditurebyalternativemeans.Consequently,IwasunabletodeterminewhetheranyadjustmentwasnecessarytogoodsandservicesstatedatR115289000(2017:R99610000)innote5tothefinancialstatements.

Operatingleasecommitments

4. The department did not disclose operating lease commitments in accordance with chapter 13, Leases, in the MCS. This was due to incorrect tariffs applied per vehicle by the lessor, Fleet Management Trading Entity, in the calculation of the lease commitments. The department alsodidnotconfirmthetariffswereinlinewiththeapprovedfeestructureandservicelevelagreement with the lessor. I was unable to determine the full extent of the overstatement ofoperatingleasecommitmentsdisclosedinnote22tothefinancialstatementsasitwasimpracticable to do so.

131

Contextfortheopinion

5. IconductedmyauditinaccordancewiththeInternationalStandardsonAuditing(ISAs).My responsibilities under those standards are further described in the auditor-general’s responsibilitiesfortheauditofthefinancialstatementssectionofthisauditor’sreport.

6. I am independent of the department in accordance with the International Ethics Standards Board for Accountants’ Code of ethics for professional accountants(IESBAcode)andtheethicalrequirementsthatarerelevanttomyauditinSouthAfrica.Ihavefulfilledmyotherethical responsibilities in accordance with these requirements and the IESBA code.

7. IbelievethattheauditevidenceIhaveobtainedissufficientandappropriatetoprovideabasisformyqualifiedopinion.

Materialuncertaintyrelatingtogoingconcern

8. Idrawattentiontothematterbelow.Myopinionisnotmodifiedinrespectofthismatter.

9. Note19tothefinancialstatementsindicatesthatthedepartmenthadsignificantcommitmentsof R24 282 000 and outstanding accruals of R5 522 000 as per note 20.1 as at 31 March 2018. As stated in note 19, these events or conditions, indicate that a material uncertainty exists that maycastsignificantdoubtonthedepartment’sabilitytocontinueasagoingconcern.

Emphasis of matters

10. Idrawattentiontothemattersbelow.Myopinionisnotmodifiedinrespectofthesematters.

Irregularexpenditure

11. Asdisclosedinnote24tothefinancialstatements,irregularexpenditureofR20958000(2017:R8303000)wasincurredduetonon-compliancewithsupplychainmanagement(SCM)requirements.Inaddition,thefullextentofirregularexpenditureisstillintheprocessofbeing determined.

Material impairments

12. Asdisclosedinnote23.2tothefinancialstatements,aprovisionforimpairmentof R10863000(2017:R7609000)hasbeenmadewithregardtoaccrueddepartmentalrevenueas a result of possible non-recovery of rental income from a debtor.

Uncertaintyregardingfutureoutcomesoflitigation

13. Asdisclosedinnote18tothefinancialstatements,thedepartmentisthedefendantinvariousclaims against the department. The department is opposing these claims. The ultimate outcome of the matter could not be determined and no provision for any liability that may result wasmadeinthefinancialstatements

132

Restatementofcorrespondingfigures

14. Asdisclosedinnote30tothefinancialstatements,thecorrespondingfiguresfor31March2017wererestatedasaresultofanerrorinthefinancialstatementsofthedepartmentat,andfor the year ended, 31 March 2018.

Other matters

15. Idrawattentiontothemattersbelow.Myopinionisnotmodifiedinrespectofthesematters.

Unaudited supplementary schedules

16. Thesupplementaryinformationsetoutonpages224to231doesnotformpartofthefinancialstatements and is presented as additional information. I have not audited these schedules and, accordingly, I do not express an opinion on thereon.

Service delivery

Small, micro and medium enterprises (SMME) support

17. The department has implemented the following programmes to support small business development,butthefullbenefittothebeneficiarieshasnotyetrealised.

18. The development of the Mangaung SMME hub will accommodate 35 SMMEs without paying rent for three years. The department had incurred expenditure of R3 million through the Free State Development Corporation as at 31 March 2018. The hub was not yet operational at year-end.

19. The department transferred a total of R22 million to the Free State Development Corporation during 2017-18 for SMME support through loans and grants. As at 31 March 2018, R14 million of the amount transferred had not been spent.

Infrastructure development

20. TheprojectfortheupgradeofthetrainbushcamptoprovideaccommodationfacilitiesattheSoetdoeringresort,commencedin2014atabudgetedcostofR30million.Theprojectshouldhave been completed within 20 months but was still in the practical completion stage at the date of this report. Due to budgetary constraints and the need to redirect funds, the scope of workwassignificantlyreduced.Thereductionsincostsshouldhaveresultedinsignificantsavings.TheactualcumulativecostsontheprojectamountedtoR29110574at31March2018,eventhoughthescopeofworkwassignificantlyreduced.However,itwasnotpracticaltodetermineiftheanticipatedsavingswouldberealisedasthefinalpaymentcertificatewaspending from the principal agent. Furthermore, the department has subsequently abandoned an educational hall where construction has not been completed. This hall was not part of the initialprojectplan.Thiscouldresultinlossestothedepartment.

133

Responsibilitiesofaccountingofficerforthefinancialstatements

21. Theaccountingofficerisresponsibleforthepreparationandfairpresentationofthefinancialstatements in accordance with the MCS and the requirements of the PFMA and Dora, and forsuchinternalcontrolastheaccountingofficerdeterminesisnecessarytoenablethepreparationoffinancialstatementsthatarefreefrommaterialmisstatement,whetherduetofraud or error.

22. Inpreparingthefinancialstatements,theaccountingofficerisresponsibleforassessingtheDepartment of Economic, Small Business Development, Tourism and Environmental Affairs’ ability to continue as a going concern, disclosing, as applicable, matters relating to going concern and using the going concern basis of accounting unless there is an intention to liquidate the department or to cease operations, or there is no realistic alternative but to do so.

Auditor-general’sresponsibilitiesfortheauditofthefinancialstatements

23. Myobjectivesaretoobtainreasonableassuranceaboutwhetherthefinancialstatementsasa 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 the 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 aggregate, they could reasonably be expected to influencetheeconomicdecisionsofuserstakenonthebasisofthesefinancialstatements.

24. Afurtherdescriptionofmyresponsibilitiesfortheauditofthefinancialstatementsisincludedinthe annexure to this auditor’s report.

Report on the audit of the annual performance report

Introduction and scope

25. InaccordancewiththePublicAuditActofSouthAfrica,2004(ActNo.25of2004)(PAA)andthegeneralnoticeissuedintermsthereof,Ihavearesponsibilitytoreportmaterialfindingsonthereportedperformanceinformationagainstpredeterminedobjectivesforselectedprogrammes presented in the annual performance report. I performed procedures to identify findingsbutnottogatherevidencetoexpressassurance.

26. 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/ measures 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 maybeincludedaspartofthereportedperformanceinformation.Accordingly,myfindingsdonot extend to these matters.

134

27. I evaluated the usefulness and reliability of the reported performance information in accordance with the criteria developed from the performance management and reporting framework,asdefinedinthegeneralnotice,forthefollowingselectedprogrammespresentedin the annual performance report of the department for the year ended 31 March 2018:

Programmes Pages in the annual perfor-mance report

Programme 2 – environmental affairs 56 – 63

Programme 3 – economic and small business development 63 – 69

28. 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.

29. Thematerialfindingsinrespectoftheusefulnessandreliabilityoftheselectedprogrammesare as follows:

Programme2–environmentalaffairs

Number of completed green issues criminal investigations handed to the national prosecuting authority(NPA)forprosecution

30. Iwasunabletoobtainsufficientappropriateauditevidenceforthereportedachievementofthe target number of completed green issues criminal investigations handed to the NPA for prosecution. This was due to limitations placed on the scope of my work as I was unable to distinguish the different categories of investigations included in the report from the NPA. I was unabletoconfirmthereportedachievementbyalternativemeans.Consequently,Iwasunabletodeterminewhetheranyadjustmentswererequiredtotheperformanceachievementof26asreported in the annual performance report.

Various indicators

31. The department did not have an adequate record-keeping system to enable reliable reporting ontheachievementoftheindicatorslistedbelow.Asaresult,Iwasunabletoobtainsufficientappropriate audit evidence in some instances, while in other cases the supporting evidence provided did not agree to the reported achievements. Based on the supporting evidence that was provided, the achievement of these indicators was different to the reported achievement in theannualperformancereport.Iwasalsounabletofurtherconfirmthereportedachievementsby alternative means. Consequently, I was unable to determine whether any further adjustmentswererequiredtothereportedachievementsoftheindicatorslistedbelow:

135

Indicator Reported achievement

Number of compliance inspections conducted for green issues 800

Number of environmental awareness activities conducted (community) 69

Number of environmental capacity building activities conducted through workshops and informal training conducted

38

Programme3–economicandsmallbusinessdevelopment

Various indicators

32. The department did not have an adequate record-keeping system to enable reliable reporting onachievementoftheindicatorslistedbelow.Asaresult,Iwasunabletoobtainsufficientappropriate audit evidence in some instances, while in other cases the supporting evidence provided did not agree to the reported achievements. Based on the supporting evidence that was provided, the achievement of these indicators was different to the reported achievement in theannualperformancereport.Iwasalsounabletofurtherconfirmthereportedachievementsby alternative means. Consequently, I was unable to determine whether any further adjustmentswererequiredtothereportedachievementsoftheindicatorslistedbelow:

Indicator Reported achievement

Audited value

Number of enterprises assisted with access to markets 31 24

Number of enterprises developed and supported 649 745

Other matters

33. I draw attention to the matters below.

Achievementofplannedtargets

34. Refer to the annual performance report on pages 43 to 73 for information on the achievement of planned targets for the year and explanations provided for the under and over achievement ofasignificantnumberoftargets.Thisinformationshouldbeconsideredinthecontextofthematerialfindingsonthereliabilityofthereportedperformanceinformationinparagraphs30to32 of this report.

Adjustment of material misstatements

35. Iidentifiedmaterialmisstatementsintheannualperformancereportsubmittedforauditing.These material misstatements were on the reported performance information of programme 2: environmental affairs and programme 3: economic and small business development. As management subsequently corrected only some of the misstatements, I raised material findingsonthereliabilityofthereportedperformanceinformation.Thosethatwerenotcorrected are reported above.

136

Report on the audit of compliance with legislation

Introduction and scope36. In accordance with the PAA and the general notice issued in terms thereof, I have a

responsibilitytoreportmaterialfindingsonthecomplianceofthedepartmentwithspecificmattersinkeylegislation.Iperformedprocedurestoidentifyfindingsbutnottogatherevidenceto express assurance.

37. Thematerialfindingsoncompliancewithspecificmattersinkeylegislationsareasfollows:

Annualfinancialstatements

38. Thefinancialstatementssubmittedforauditingwerenotpreparedinaccordancewiththeprescribedfinancialreportingframeworkandsupportedbyfullandproperrecordsasrequiredbysection40(1)(a)and(b)ofthePFMA.Materialmisstatementsofexpenditure,payablesanddisclosurenoteswereidentifiedbytheauditorsinthesubmittedfinancialstatementswerecorrected, but the uncorrected material misstatements and supporting records that could not beprovidedresultedinthefinancialstatementsreceivingaqualifiedopinion.

Strategicplanningandperformancemanagement

39. Specificinformationsystemswerenotestablishedtoenablethemonitoringofprogressmadetowardsachievingtargets,coreobjectivesandservicedeliveryasrequiredbypublicserviceregulation25(1)(e)(i)and(iii).

Expendituremanagement

40. Effective and appropriate steps were not taken to prevent irregular expenditure, as required bysection38(1)(c)(ii)ofthePFMAandtreasuryregulation9.1.1.Thevalue,asdisclosedinnote24tothefinancialstatements,isnotcompleteasmanagementwasstillintheprocessofquantifyingthefullextentoftheirregularexpenditure.Themajorityoftheirregularexpendituredisclosedinthefinancialstatementswascausedbynon-compliancewithSCMrequirements.

Procurementandcontractmanagement

41. Some of the goods and services with a transaction value below R500 000 were procured without obtaining the required price quotations, as required by treasury regulation 16A6.1. Similar non-compliance was also reported in the prior year.

42. Invitations for competitive bidding were not advertised for a required minimum period, as requiredbytreasuryregulations16A6.3(c).

Consequencemanagement

43. Iwasunabletoobtainsufficientappropriateauditevidencethatdisciplinarystepsweretakenagainstofficialswhohadincurredirregularexpenditureasrequiredbysection38(1)(h)(iii)ofthe PFMA. This was due to proper and complete records that were not maintained as evidence to support the investigations into irregular expenditure.

137

Other information

44. Theaccountingofficerisresponsiblefortheotherinformation.Theotherinformationcomprisesthe information included in the annual report. The other information does not include the financialstatements,theauditor’sreportandthoseselectedprogrammespresentedintheannualperformancereportthathavebeenspecificallyreportedinthisauditor’sreport.

45. Myopiniononthefinancialstatementsandfindingsonthereportedperformanceinformationand compliance with legislation do not cover the other information and I do not express an audit opinion or any form of assurance conclusion thereon.

46. In connection with my audit, my responsibility is to read the other information and, in doing so, considerwhethertheotherinformationismateriallyinconsistentwiththefinancialstatementsand the selected programmes presented in the annual performance report, or my knowledge obtained in the audit, or otherwise appears to be materially misstated.

47. I did not receive the other information prior to the date of this auditor’s report. After I receive and read this information, and if I conclude that there is a material misstatement, I am required to communicate the matter to those charged with governance and request that the other information be corrected. If the other information is not corrected, I may have to retract this auditor’s report and re-issue an amended report as appropriate. However, if it is corrected this will not be necessary.

Internal control deficiencies

48. Iconsideredinternalcontrolrelevanttomyauditofthefinancialstatements,reportedperformanceinformationandcompliancewithapplicablelegislation;however,myobjectivewas not to express any form of assurance on it. The matters reported below are limited to thesignificantinternalcontroldeficienciesthatresultedinthebasisforthequalifiedopinion,thefindingsontheannualperformancereportandthefindingsoncompliancewithlegislationincluded in this report.

49. The leadership of the department did not implement adequate oversight over the implementation of internal controls and action plans to address material misstatements reportedintheprioryear.Thisresultedinsimilarfindingsbeingreportedinthecurrentyear.Thiswasmainlyduetoslowresponsebyleadershipasdeficienciesinthedesignandimplementationofactionsplanswerenottimelyidentifiedandaddressed.Furthermore,thedepartment has seen a high turnover in senior managerial positions.

50. The department changed premises during the period under review. However, the new premises did not have access to the transversal information systems of BAS, Persal and Logis and internet connections for an extended period of time. Daily and monthly disciplines involving transversal systems could not be performed. In addition, key communications that required internet connections could not be performed.

51. Senior management did not provide adequate supervisory and monitoring controls over financialandperformancereportingandcompliancewithlegislation.Thiswasmainlyduetoalackofconsequencesasnoactionistakenfornon-complianceandincorrectfinancialandperformance reporting. In addition, management applied an incorrect interpretation of the accountingstandardstorecordexpenditureforSMMEsupportdespitesimilarfindingsraisedin the prior year.

138

52. Management did not implement appropriate risk management strategies to identify, prevent and mitigate current and emerging risks faced by the department. This was mainly due to slow responsebymanagementasmajorriskshavenotbeenmitigated.

Other reports

53. I draw attention to the following engagements conducted by various parties that had, or could have,animpactonthemattersreportedinthedepartment’sfinancialstatements,reportedperformance information, compliance with applicable legislation and other related matters. Thesereportsdidnotformpartofmyopiniononthefinancialstatementsormyfindingsonthereported performance information or compliance with legislation.

54. Management was conducting an investigation of possible abuse of travel and subsistence claims by departmental staff. The investigation started in 2015 and was ongoing at the reporting date.

Bloemfontein

31 July 2018

139

Annexure – Auditor-general’s responsibility for the audit1. AspartofanauditinaccordancewiththeISAs,Iexerciseprofessionaljudgementand

maintainprofessionalscepticismthroughoutmyauditofthefinancialstatements,andtheprocedures performed on reported performance information for selected programmes and on thedepartment’scompliancewithrespecttotheselectedsubjectmatters.

Financial statements2. Inadditiontomyresponsibilityfortheauditofthefinancialstatementsasdescribedinthis

auditor’s report, I also:

• identifyandassesstherisksofmaterialmisstatementofthefinancialstatementswhetherdue to fraud or error, design and perform audit procedures responsive to those risks, and obtainauditevidencethatissufficientandappropriatetoprovideabasisformyopinion.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

• obtainanunderstandingofinternalcontrolrelevanttotheauditinordertodesignauditprocedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the department’s internal control

• evaluatetheappropriatenessofaccountingpoliciesusedandthereasonablenessofaccountingestimatesandrelateddisclosuresmadebytheaccountingofficer

• concludeontheappropriatenessoftheaccountingofficer’suseofthegoingconcernbasisofaccountinginthepreparationofthefinancialstatements.Ialsoconclude,basedon the audit evidence obtained, whether a material uncertainty exists related to events or conditionsthatmaycastsignificantdoubtontheDepartmentofEconomic,SmallBusinessDevelopment, Tourism and Environmental Affairs’ 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 reporttotherelateddisclosuresinthefinancialstatementsaboutthematerialuncertaintyor,ifsuchdisclosuresareinadequate,tomodifytheopiniononthefinancialstatements.My conclusions are based on the information available to me at the date of this auditor’s report. However, future events or conditions may cause a department to cease continuing as a going concern

• evaluatetheoverallpresentation,structureandcontentofthefinancialstatements,includingthedisclosures,andwhetherthefinancialstatementsrepresenttheunderlyingtransactions and events in a manner that achieves fair presentation

Communicationwiththosechargedwithgovernance3. Icommunicatewiththeaccountingofficerregarding,amongothermatters,theplannedscope

andtimingoftheauditandsignificantauditfindings,includinganysignificantdeficienciesininternal control that I identify during my audit.

4. IalsoconfirmtotheaccountingofficerthatIhavecompliedwithrelevantethicalrequirementsregarding independence, and communicate all relationships and other matters that may reasonably be thought to have a bearing on my independence and, where applicable, related safeguards.

140

ANNUAL FINANCIAL STATEMENTSFOR DEPARTMENT OF ECONOMIC,SMALL BUSINESS DEVELOPMENT,TOURISM AND ENVIRONMENTAFFAIRS

For the year ended31 March 2018

141

DEPARTMENT OF ECONOMIC, SMALL BUSINESS DEVELOPMENT, TOURISM AND


VOTE 3

ANNUAL FINANCIAL STATEMENTS

for the year ended 31 March 2018

- 2 -

Table of Contents

Appropriation Statement 142

Notes to the Appropriation Statement 174

Statement of Financial Performance 176

Statement of Financial Position 177

Statement of Changes in Net Assets 178

Cash Flow Statement 179

Notes to the Annual Financial Statements (including Accounting policies) 180

Annexures 224

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De

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non

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Ho

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1

147

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PA

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NT

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EC

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INIT

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20

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Op

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4

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Ven

ues a

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facili

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s

2

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(17

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-

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%

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48

148

DE

PA

RT

ME

NT

OF

EC

ON

OM

IC,

SM

AL

L B

US

INE

SS

DE

VE

LO

PM

EN

T,

TO

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AN

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NV

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EN

TA

L A

FF

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3

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PR

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TIO

N S

TA

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for

the

ye

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de

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1 M

arc

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01

8

9

Pro

gra

mm

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: A

DM

INIT

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TIO

N

20

17

/18

20

16

/17

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dju

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pro

pri

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on

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2

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1

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D

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or

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74

4

149

DE

PA

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NT

OF

EC

ON

OM

IC,

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AL

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75

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s a

nd

se

rvic

es

3 2

13

(75

) -

3

13

8

2 5

10

62

7

80

.0%

2 2

73

2 0

95

Tra

nsfe

rs a

nd

su

bs

idie

s

-

-

-

-

60

(60)

-

-

-

Hou

se

ho

lds

-

-

-

-

60

(60)

-

-

-

Pa

ym

en

ts f

or

ca

pit

al a

sse

ts

36

2

(2

02

)

-

1

60

10

6

5

4

6

6.3

%

88

69

Ma

ch

inery

an

d e

qu

ipm

en

t 3

62

(

202

) -

1

60

1

06

5

4

66

.3%

8

8

69

Pa

ym

en

ts f

or

fin

an

cia

l ass

ets

-

- -

- 1

9

(19)

- -

-

TO

TA

L

11

856

(

277

) -

1

1 5

79

1

0 0

67

1

51

2

86

.9%

8 0

97

7 9

36

150

DE

PA

RT

ME

NT

OF

EC

ON

OM

IC,

SM

AL

L B

US

INE

SS

DE

VE

LO

PM

EN

T,

TO

UR

ISM

AN

D E

NV

IRO

NM

EN

TA

L A

FF

AIR

S

VO

TE

3

AP

PR

OP

RIA

TIO

N S

TA

TE

ME

NT

for

the

ye

ar

en

de

d 3

1 M

arc

h 2

01

8

11

1.2

MA

NA

GE

ME

NT

SE

RV

ICE

S

20

17

/18

20

16

/17

A

dju

ste

d

Ap

pro

pri

ati

on

S

hif

tin

g o

f F

un

ds

Vir

em

en

t F

ina

l A

pp

rop

ria

tio

n

Ac

tua

l E

xp

en

dit

ure

V

ari

an

ce

Ex

pe

nd

itu

re

as

% o

f fi

na

l a

pp

rop

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on

Fin

al

Ap

pro

pri

ati

on

A

ctu

al

exp

en

dit

ure

Eco

no

mic

cla

ss

ific

ati

on

R

'00

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00

R

'00

0

R'0

00

R

'00

0

R'0

00

%

R

'00

0

R'0

00

Cu

rre

nt

pa

ym

en

ts

25

093

(5

89

) -

2

4 5

04

2

5 9

81

(

1 4

77)

10

6.0

%

25

399

25

070

Com

pe

nsa

tio

n o

f e

mplo

yee

s

21

696

-

-

21

696

2

2 7

46

(

1 0

50)

10

4.8

%

21

323

22

160

Go

od

s a

nd

se

rvic

es

3 3

97

(5

89

) -

2

808

3 2

35

(42

7)

11

5.2

%

4 0

76

2 9

10

Tra

nsfe

rs a

nd

su

bs

idie

s

19

0

-

25

0

440

3

04

1

36

6

9.1

%

10

5

104

Hou

se

ho

lds

19

0

-

25

0

440

3

04

1

36

6

9.1

%

10

5

104

Pa

ym

en

ts f

or

ca

pit

al a

sse

ts

1 2

65

76

3

-

2 0

28

1 1

39

88

9

56

.2%

1

71

144

Ma

ch

inery

an

d e

qu

ipm

en

t 1

26

5

76

3

-

2 0

28

1 1

39

88

9

56

.2%

1

71

144

Pa

ym

en

ts f

or

fin

an

cia

l a

ss

ets

- -

- -

-

-

-

15

15

TO

TA

L

26

548

17

4

25

0

26

972

2

7 4

24

(

45

2)

10

1.7

%

25

690

25

333

151

DE

PA

RT

ME

NT

OF

EC

ON

OM

IC,

SM

AL

L B

US

INE

SS

DE

VE

LO

PM

EN

T,

TO

UR

ISM

AN

D E

NV

IRO

NM

EN

TA

L A

FF

AIR

S

VO

TE

3

AP

PR

OP

RIA

TIO

N S

TA

TE

ME

NT

for

the

ye

ar

en

de

d 3

1 M

arc

h 2

01

8

12

1.3

. F

INA

NC

IAL

MA

NA

GE

ME

NT

20

17

/18

20

16

/17

A

dju

ste

d

Ap

pro

pri

ati

on

S

hif

tin

g o

f F

un

ds

Vir

em

en

t F

ina

l A

pp

rop

ria

tio

n

Ac

tual

Ex

pe

nd

itu

re

Va

ria

nc

e

Exp

en

dit

ure

a

s %

of

fin

al

ap

pro

pri

ati

on

Fin

al

Ap

pro

pri

ati

on

A

ctu

al

ex

pe

nd

itu

re

Eco

no

mic

cla

ss

ific

ati

on

R

'00

0

R'0

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R'0

00

R

'00

0

R'0

00

R

'00

0

%

R'0

00

R

'000

Cu

rre

nt

pa

ym

en

ts

62

510

1

14

3

85

0

64

503

6

9 2

45

(

4 7

42)

10

7.4

%

62

100

62

021

Com

pe

nsa

tio

n o

f e

mplo

yee

s

29

338

-

(

2 5

00)

26

838

2

8 0

70

(

1 2

32)

10

4.6

%

29

393

28

564

Go

od

s a

nd

se

rvic

es

33

172

1

14

3

3 3

50

37

665

4

1 1

75

(

3 5

10)

10

9.3

%

32

707

33

457

Tra

nsfe

rs a

nd

su

bsid

ies

2

-

-

2

1

3

(11

) 6

50

.0%

1

25

12

3

Dep

art

me

nta

l a

ge

ncie

s a

nd

a

cco

un

ts

2

-

-

2

-

2

-

2

-

Hou

se

ho

lds

-

-

-

-

13

(

13

) -

1

23

12

3

Pa

ym

en

ts f

or

ca

pit

al a

sse

ts

1 1

24

74

0

-

1 8

64

1 2

24

64

0

65

.7%

6

67

47

3

Ma

ch

inery

an

d e

qu

ipm

en

t 1

12

4

74

0

-

1 8

64

1 2

24

64

0

65

.7%

6

67

47

3

Pa

ym

en

ts f

or

fin

an

cia

l a

sse

ts

-

-

-

-

-

-

-

32

31

TO

TA

L

63

636

1

88

3

85

0

66

369

7

0 4

82

(

4 1

13)

10

6.2

%

69

924

62

648

152

DE

PA

RT

ME

NT

OF

EC

ON

OM

IC,

SM

AL

L B

US

INE

SS

DE

VE

LO

PM

EN

T,

TO

UR

ISM

AN

D E

NV

IRO

NM

EN

TA

L A

FF

AIR

S

VO

TE

3

AP

PR

OP

RIA

TIO

N S

TA

TE

ME

NT

for

the

ye

ar

en

de

d 3

1 M

arc

h 2

01

8

13

1.4

. C

OR

PO

RA

TE

SE

RV

ICE

S

20

17

/18

20

16

/17

A

dju

ste

d

Ap

pro

pri

ati

on

S

hif

tin

g o

f F

un

ds

Vir

em

en

t F

ina

l A

pp

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ria

tio

n

Ac

tual

Ex

pe

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re

Va

ria

nc

e

Exp

en

dit

ure

a

s %

of

fin

al

ap

pro

pri

ati

on

Fin

al

Ap

pro

pri

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ctu

al

ex

pe

nd

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re

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no

mic

cla

ss

ific

ati

on

R

'00

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00

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R'0

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R

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00

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'000

Cu

rre

nt

pa

ym

en

ts

38

023

(

2 3

10)

-

35

713

3

2 6

29

3

08

4

91

.4%

3

9 2

98

38

457

Com

pe

nsa

tio

n o

f e

mplo

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s

24

001

(

20

0)

-

2

3 8

01

2

2 3

72

1

42

9

94

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3

1 1

33

30

471

Go

od

s a

nd

se

rvic

es

14

022

(

2 1

10)

-

11

912

1

0 2

57

1

65

5

86

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8

16

5

7 9

86

Tra

nsfe

rs a

nd

su

bs

idie

s

2

-

-

2

37

(

35

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85

0.0

%

80

77

Dep

art

me

nta

l a

ge

ncie

s a

nd

a

cco

un

ts

2

-

-

2

-

2

-

2

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Hou

se

ho

lds

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-

-

37

(

37

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7

8

77

Pa

ym

en

ts f

or

cap

ita

l a

sse

ts

(6

6)

53

0

-

46

4

41

7

47

8

9.9

%

33

8

28

1

Ma

ch

inery

an

d e

qu

ipm

en

t (

66

) 5

30

-

46

4

41

7

47

8

9.9

%

33

8

28

1

Pa

ym

en

ts f

or

fin

an

cia

l a

sse

ts

-

-

-

-

-

-

-

12

12

TO

TA

L

37

959

(

1 7

80)

-

36

179

3

3 0

83

3

09

6

91

.4%

3

9 7

28

38

827

153

DE

PA

RT

ME

NT

OF

EC

ON

OM

IC,

SM

AL

L B

US

INE

SS

DE

VE

LO

PM

EN

T,

TO

UR

ISM

AN

D E

NV

IRO

NM

EN

TA

L A

FF

AIR

S

VO

TE

3

AP

PR

OP

RIA

TIO

N S

TA

TE

ME

NT

for

the

ye

ar

en

de

d 3

1 M

arc

h 2

01

8

14

Pro

gra

mm

e 2

: E

NV

IRO

NM

EN

TA

L A

FF

AIR

S

20

17

/18

20

16

/17

A

dju

ste

d

Ap

pro

pri

ati

on

S

hif

tin

g o

f F

un

ds

Vir

em

en

t F

inal

Ap

pro

pri

ati

on

A

ctu

al

Exp

en

dit

ure

V

ari

an

ce

Ex

pe

nd

itu

re

as

% o

f fi

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l a

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pro

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al

ex

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re

R

'00

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b p

rog

ram

me

1.

EN

VIR

ON

ME

NT

AL

PO

LIC

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PL

AN

NIN

G A

ND

C

OO

RD

INA

TIO

N

7 3

17

-

1 7

00

9 0

17

7 1

90

1 8

27

79

.7%

7

20

9

7 7

18

2.

CO

MP

LIA

NC

E A

ND

E

NF

OR

CE

ME

NT

15

399

(

965

) -

1

4 4

34

1

5 6

09

(

1 1

75)

10

8.1

%

13

170

10

996

3.

EN

VIR

ON

ME

NT

AL

QU

AL

ITY

M

AN

AG

EM

EN

T

23

051

(

608

) 1

15

2

2 5

88

2

3 6

55

(1

09

7)

10

4.7

%

11

244

7 4

47

4.

BIO

DIV

ER

SIT

Y

MA

NA

GE

ME

NT

82

599

2

10

1

(5

757)

78

943

8

0 5

03

(

1 5

60)

10

2.0

%

99

343

10

5 1

77

5.

EN

VIR

ON

ME

NT

AL

E

MP

OW

ER

ME

NT

SE

RV

ICE

S

12

267

(

528

) -

1

1 7

39

1

0 9

01

83

8

92

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1

5 4

76

8 1

50

To

tal

for

su

b p

rog

ram

mes

14

0 6

33

-

(

3 9

42)

13

6 6

91

1

37

858

(

1 1

67)

10

0.9

%

14

6 4

42

13

9 4

88

Eco

no

mic

cla

ss

ific

ati

on

Cu

rre

nt

pa

ym

en

ts

13

1 1

72

9

10

(2 3

57

)

1

29

72

5

13

1 6

08

(1 8

83

)

10

1.5

%

12

5 6

17

12

4 7

74

Co

mpe

nsa

tio

n o

f e

mp

loye

es

9

5 6

81

-

4 5

00

1

00

18

1

10

3 2

26

(3 0

45

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10

3.0

%

9

6 0

63

95

998

Sa

larie

s a

nd

wage

s

8

6 5

76

-

4 5

00

91

076

81

628

9 4

48

89

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8

3 4

29

81

325

So

cia

l co

ntr

ibu

tio

ns

9

10

5

-

-

9 1

05

21

598

(1

2 4

93

)

23

7.2

%

1

2 6

34

14

673

Go

od

s a

nd

se

rvic

es

35

491

9

10

(6

857

)

29

544

28

382

1 1

62

96

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2

9 5

54

28

776

Ad

min

istr

ative

fe

es

4

80

-

84

82

2

9

7.6

%

-

-

Ad

ve

rtis

ing

(5

13

)

(2

9)

6

43

1

01

140

(3

9)

13

8.6

%

2

83

12

2

154

DE

PA

RT

ME

NT

OF

EC

ON

OM

IC,

SM

AL

L B

US

INE

SS

DE

VE

LO

PM

EN

T,

TO

UR

ISM

AN

D E

NV

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NM

EN

TA

L A

FF

AIR

S

VO

TE

3

AP

PR

OP

RIA

TIO

N S

TA

TE

ME

NT

for

the

ye

ar

en

de

d 3

1 M

arc

h 2

01

8

15

Pro

gra

mm

e 2

: E

NV

IRO

NM

EN

TA

L A

FF

AIR

S

20

17

/18

20

16

/17

A

dju

ste

d

Ap

pro

pri

ati

on

S

hif

tin

g o

f F

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inal

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pro

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on

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ctu

al

Exp

en

dit

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Ex

pe

nd

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re

as

% o

f fi

na

l a

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pro

pri

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ex

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'00

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R'0

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R

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ing

(5

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(2

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6

43

1

01

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40

(3

9)

13

8.6

%

2

83

12

2

Min

or

asse

ts

1 6

28

(6

70

)

(1

50

)

8

08

1

24

6

84

15

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8

86

12

7

Ca

tering

: D

epart

men

tal activitie

s

9

06

(2

4)

-

8

82

7

94

88

90

.0%

4

58

42

2

Co

mm

un

ica

tio

n (

G&

S)

43

4

(1

7)

-

4

17

4

67

(50

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11

2.0

%

1

04

4

79

1

Co

mp

ute

r se

rvic

es

2

-

-

2

14

(1

2)

70

0.0

%

7

89

35

7

Co

nsu

lta

nts

: B

usin

ess a

nd

a

dvis

ory

se

rvic

es

4 0

00

(236

)

(2 8

00

)

9

64

5

91

3

73

61

.3%

7

46

3

7 3

41

Co

ntr

acto

rs

4 3

22

2 0

05

-

6 3

27

4 4

38

1 8

89

70

.1%

5

66

0

4 9

25

A

ge

ncy

an

d s

uppo

rt /

ou

tso

urc

ed

se

rvic

es

7

32

(6

89

)

-

43

17

26

39

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3 6

94

3 5

03

In

ven

tory

: C

loth

ing

ma

teria

l

an

d a

cce

sso

rie

s

-

-

-

-

-

-

-

5

37

-

Inven

tory

: F

arm

ing

sup

plie

s

-

-

-

-

-

-

-

3

38

-

Inven

tory

: F

ue

l, o

il a

nd

ga

s

-

-

-

-

-

-

-

3

93

-

Inven

tory

: M

ate

ria

ls a

nd

su

pplie

s

-

-

-

-

-

-

-

1

25

3

-

Co

nsu

ma

ble

su

pp

lies

4 7

31

5

75

-

5 3

06

4 7

95

5

11

90

.4%

2 6

77

3 6

84

C

on

su

ma

ble

: S

tatio

ne

ry,

prin

ting

and

off

ice

su

pp

lies

1 6

01

(2

13

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-

1 3

88

1 1

46

2

42

82

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1 0

74

95

9

Op

era

tin

g le

ases

-

-

-

-

-

-

-

-

66

Pro

pert

y p

aym

en

ts

11

406

2 3

10

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50

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DE

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(3)

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81

81

TO

TA

L

82

599

2

10

1

(5

75

7)

78

943

8

0 5

03

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1 5

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10

2.0

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99

343

10

5 1

77

161

DE

PA

RT

ME

NT

OF

EC

ON

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AL

L B

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TA

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20

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96

Go

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2 0

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Tra

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bs

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20

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97

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Ma

ch

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2

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84

91

Inta

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1

5

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Pa

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9

TO

TA

L

12

267

(

52

8)

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11

739

1

0 9

01

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8

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50

162

DE

PA

RT

ME

NT

OF

EC

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IC,

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L B

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VE

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Pro

gra

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16

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Su

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49

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68

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SM

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L B

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T

36

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37

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2

8 8

97

8

81

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880

To

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21

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2

98

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17

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9

2.2

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11

4 3

78

11

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53

Eco

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on

Cu

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nt

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ts

69

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70

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72

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15

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4

6 5

42

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pe

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f e

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45

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26

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Sala

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44

40

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25

41

6

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5 6

23

Socia

l co

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tio

ns

1

28

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28

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58

Go

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24

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61

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Adve

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1

49

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53

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(3

3)

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32

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Min

or

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1

79

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1

15

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3

41

Aud

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: E

xte

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-

5

(35

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(3

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1)

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%)

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163

DE

PA

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C

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Busin

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11

86

8

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3 6

93

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61

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20

64

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60

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Ag

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Op

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17

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94

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10

Op

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ts

3

96

(22

0)

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1

76

60

1

16

34

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84

13

5

Ve

nu

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nd

facili

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s

6

20

23

9

-

8

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7

59

1

00

88

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2

27

17

5

Re

nta

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nd

hirin

g

5

51

(44

8)

(10

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93

40

53

43

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-

164

DE

PA

RT

ME

NT

OF

EC

ON

OM

IC,

SM

AL

L B

US

INE

SS

DE

VE

LO

PM

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T,

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Pro

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MIC

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20

17

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20

16

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Tra

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1

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85

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65

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6 6

25

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6 6

45

1

28

11

7

1

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28

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7.4

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66

300

66

280

D

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me

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ge

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d a

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1

09 4

25

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70

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00

1

12

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5

1

12

77

0

(4

5)

1

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55

55

1

5

5 5

51

Socia

l se

cu

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De

pa

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ntities)

1

09 4

25

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)

7 0

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1

12

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5

1

12

77

0

(4

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5

5 5

51

55

551

P

ub

lic c

orp

ora

tio

ns a

nd

p

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en

terp

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35 2

60

(3 0

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-

3

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60

14

465

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795

44

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0

10

200

Pub

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orp

ora

tio

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3

5 2

60

(3 0

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-

32

260

14

465

17

795

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4.8

%

1

0 2

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10

200

O

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co

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ratio

ns

3

5 2

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32

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465

17

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4.8

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10

20

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Ho

use

ho

lds

1 8

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23

5

(37

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1 6

60

8

82

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78

53

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5

49

52

9

Socia

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63

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4

49

11

8

Oth

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1

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5

(37

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1

Pa

ym

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ts f

or

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2 3

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Ma

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1

Oth

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mach

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2 3

82

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99

6

25

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74

62

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8

69

53

1

Pa

ym

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nc

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as

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-

1

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15

10

5

6

6.7

%

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-

TO

TA

L

2

15

18

5

-

2 9

82

2

18

16

7

2

01

07

5

17

092

92

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1

14

37

8

11

3 3

53

165

DE

PA

RT

ME

NT

OF

EC

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IC,

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AL

L B

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20

16

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18

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Com

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f e

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11

605

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1

1 6

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3 4

83

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1 8

78)

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9 3

40

8 5

82

Go

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nd

se

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es

7 3

17

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6 0

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4

61

8

4 2

31

Tra

nsfe

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30

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000

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2

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60

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17

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10

226

Hig

he

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Pu

blic

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nd

p

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30

260

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7 2

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5

17

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10

200

H

ou

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Pa

ym

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ts f

or

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98

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Ma

ch

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64

TO

TA

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182

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44

947

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50

1

2 1

97

72

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4 2

56

23

103

166

DE

PA

RT

ME

NT

OF

EC

ON

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IC,

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AL

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US

INE

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VE

LO

PM

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TA

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for

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ye

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de

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EC

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01

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20

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Com

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55

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Hou

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Ma

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TO

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29

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39

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357

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370

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DE

PA

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NT

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48

Go

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12

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880

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169

DE

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Pro

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Tra

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De

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DE

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174



VOTE 3

NOTES TO THE APPROPRIATION STATEMENT


- 35 -

1. Detail of transfers and subsidies as per Appropriation Act (after Virement):

Detail of these transactions can be viewed in the note on Transfers and subsidies, disclosure

notes and Annexure 1 (A-H) to the Annual Financial Statements.

2. Detail of specifically and exclusively appropriated amounts voted (after Virement):

Detail of these transactions can be viewed in note 1 (Annual Appropriation) to the Annual

Financial Statements.

3. Detail on payments for financial assets

Detail of these transactions per programme can be viewed in the note on Payments for

financial assets to the Annual Financial Statements.

4. Explanations of material variances from Amounts Voted (after Virement):

4.1 Per programme Final

Appropriation

Actual

Expenditure

Variance

R’000

Variance as a

% of Final

Appropriation

1. ADMINISTRATION 141 099 141 056 43 0.03

2. ENVIRONMENTAL

AFFAIRS

136 691 137 858 (1 167) (0.85)

3. ECONOMIC

DEVELOPMENT

218 167 201 075 17 092 7.83

4. TOURISM 9 191 8 937 254 2.76

4.2 Per economic classification Final

Appropriation

Actual

Expenditure

Variance Variance as a

% of Final

Appropriation

R’000 R’000 R’000 R’000

Current payments

Compensation of employees 232 465 235 249 (2 784) (1 20)

Goods and services 113 017 115 289 (2 272) (2.01)

Transfers and subsidies

Departmental agencies and

accounts

112 925 112 809 116 0.10

Public corporations and private

enterprises

32 260 14 465 17 795 55.16

Households 2 450 1 632 818 33.39

Payments for capital assets

Buildings and other fixed structures 3 705 3 892 (187) (5.05)

Machinery and equipment

Software and other intangible assets

7 951

345

5 549

-

2 402

345

30.21

100.00

Payments for financial assets 30 41 (11) (36.67)

175



VOTE 3

NOTES TO THE APPROPRIATION STATEMENT


- 36 -

The department spent 100% of the budget allocated.

4.3 Per conditional grant Final

Appropriation

Actual

Expenditure

Variance Variance as a

% of Final

Appropriation

R’000 R’000 R’000 R’000

EPWP Incentive Grant 2 000 1 820 180 9.00

The department spent 91% on conditional grants, The R180 that was not spent was due to employees

who did not come to work and were not paid as such.

176



VOTE 3 STATEMENT OF FINANCIAL PERFORMANCE


- 37 -

Note 2017/18 2016/17

R'000 R'000

REVENUE

Annual appropriation 1 505 148 474 996

Departmental revenue 2 - -

TOTAL REVENUE 505 148 474 996

EXPENDITURE

Current expenditure

Compensation of employees 4 235 249 218 930

Goods and services 5 115 289 99 610

Aid assistance 3 51 403

Total current expenditure 350 589 318 943

Transfers and subsidies

Transfers and subsidies 7 128 904 128 677

Total transfers and subsidies 128 904 128 677

Expenditure for capital assets

Tangible assets 8 9 443 15 452

Total expenditure for capital assets 9 443 15 452

Payments for financial assets 6 41 407

TOTAL EXPENDITURE 488 977 463 479

SURPLUS/(DEFICIT) FOR THE YEAR 16 171 11 517

Reconciliation of Net Surplus/(Deficit) for the year

Voted funds 16 222 11 920

Annual appropriation 16 042 11 154

Conditional grants 180 766

Aid assistance 3 (51) (403)

SURPLUS/(DEFICIT) FOR THE YEAR 16 171 11 517

177



VOTE 3

STATEMENT OF FINANCIAL POSITION

as at 31 March 2018

- 38 -

Note 2017/18 2016/17

R'000 R'000

ASSETS

Current assets

17 379 12 284

Unauthorised expenditure 9 1 167 -

Cash and cash equivalents 10 530 10 620

Prepayments and advances 11 13 617 17

Receivables 12 2 065 1 647

Non-current assets

2 126 1 753

Receivables 12 2 126 1 753

TOTAL ASSETS 19 505 14 037

LIABILITIES

Current liabilities

18 439 13 108

Voted funds to be surrendered to the Revenue Fund 13 17 389 11 920

Departmental revenue and NRF Receipts to be

surrendered to the Revenue Fund

14 801 894

Payables 15 6 -

Aid assistance unutilised 3 243 294

TOTAL LIABILITIES 18 439 13 108

NET ASSETS 1 066 929

Note 2017/18 2016/17

R'000 R'000

Represented by:

Recoverable revenue 1 066 929

TOTAL 1 066 929

178



VOTE 3

STATEMENT OF CHANGES IN NET ASSETS


- 39 -

Note 2017/18 2016/17

R'000 R'000

Recoverable revenue

Opening balance 929 386

Transfers: 137 543

Irrecoverable amounts written off 6.1 19 264

Debts revised 62 -

Debts recovered (included in departmental

receipts)

(1 093) (445)

Debts raised 1 147 724

Closing balance 1 066 929

TOTAL 1 066 929

179



VOTE 3

CASH FLOW STATEMENT


- 40 -

Note 2017/18 2016/17

R'000 R’000

CASH FLOWS FROM OPERATING ACTIVITIES

Receipts 518 956 486 332

Annual appropriated funds received 1.1 505 148 474 996

Departmental revenue received 2 13 780 11 308

Interest received 2.3 28 28

Net (increase)/decrease in working capital (15 552) 72

Surrendered to Revenue Fund (33 947) (16 931)

Current payments (349 422) (306 380)

Payments for financial assets (41) (407)

Transfers and subsidies paid (128 904) (141 240)

Net cash flow available from operating activities 16 (8 910) 21 446

CASH FLOWS FROM INVESTING ACTIVITIES

Payments for capital assets 8 (9 443) (15 452)

Proceeds from sale of capital assets 2.4 8 126 -

Net cash flows from investing activities (1 317) (15 452)

CASH FLOWS FROM FINANCING ACTIVITIES

Increase/(decrease) in net assets 137 543

Net cash flows from financing activities 137 543

Net increase/(decrease) in cash and cash equivalents (10 090) 6 537

Cash and cash equivalents at beginning of period 10 620 4 083

Cash and cash equivalents at end of period 16 530 10 620

180



VOTE 3

NOTES TO THE ANNUAL FINANCIAL STATEMENTS


- 41 -

PART A: ACCOUNTING POLICIES

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).

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.

181



VOTE 3



- 42 -

7 Revenue

7.1 Appropriated funds

Appropriated funds comprises of departmental allocations.

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

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.

Write-offs are made according to the department’s debt write-off policy

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.

182



VOTE 3



- 43 -

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 Accruals and payables not recognised

Accruals and payables not recognised are 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.

Accruals and payables not recognised are measured at cost.

8.4 Leases

8.4.1 Operating leases

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 Aid Assistance

9.1 Aid assistance received

Aid assistance received in cash is recognised in the statement of financial performance when

received. In-kind aid assistance is recorded in the notes to the financial statements on the date

of receipt and is measured at fair value.

Aid assistance not spent for the intended purpose and any unutilised funds from aid assistance

that are required to be refunded to the donor are recognised as a payable in the statement of

financial position.

9.2 Aid assistance paid

Aid assistance paid is recognised in the statement of financial performance on the date of

payment. Aid assistance payments made prior to the receipt of funds are recognised as a

183



VOTE 3



- 44 -

receivable in the statement of financial position.

10 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.

11 Prepayments and advances

Prepayments and advances are recognised in the statement of financial position when the

department receives or disburses the cash.

Prepayments and advances are initially and subsequently measured at cost.

12 Receivables

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.

13 Financial assets

13.1 Financial assets (not covered elsewhere)

A financial asset is recognised initially at its cost plus transaction costs that are directly

attributable to the acquisition or issue of the financial asset.

At the reporting date, a department shall measure its financial assets at cost, less amounts

already settled or written-off, except for recognised loans and receivables, which are measured

at cost plus accrued interest, where interest is charged, less amounts already settled or written-

off.

13.2 Impairment of financial assets

Where there is an indication of impairment of a financial asset, an estimation of the reduction in

the recorded carrying value, to reflect the best estimate of the amount of the future economic

benefits expected to be received from that asset, is recorded in the notes to the financial

statements.

14 Payables

Payables recognised in the statement of financial position are recognised at cost.

15 Capital Assets

184



VOTE 3



- 45 -

15.1 Immovable capital assets

Immovable assets reflected in the asset register of the department are recorded in the notes to

the financial statements at cost or fair value where the cost cannot be determined reliably.

Immovable assets acquired in a non-exchange transaction are recorded at fair value at the date

of acquisition. Immovable assets are subsequently carried in the asset register at cost and are

not currently subject to depreciation or impairment.

Subsequent expenditure of a capital nature forms part of the cost of the existing asset when

ready for use.

Additional information on immovable assets not reflected in the assets register is provided in the

notes to financial statements.

15.2 Movable capital assets

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.

All assets acquired prior to 1 April 2005 (or a later date as approved by the OAG) may be

recorded at R1.

Movable 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 movable asset is recorded by another department/entity in which

case the completed project costs are transferred to that department.

15.3 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.

All assets acquired prior to 1 April 2005 (or a later date as approved by the OAG) may be

recorded at R1.

Intangible 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

185



VOTE 3



- 46 -

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.

15.4 Project Costs: Work-in-progress

Expenditure of a capital nature is initially recognised in the statement of financial performance at

cost when paid.

Amounts paid towards capital projects are separated from the amounts recognised and

accumulated in work-in-progress until the underlying asset is ready for use. Once ready for use,

the total accumulated payments are recorded in an asset register. Subsequent payments to

complete the project are added to the capital asset in the asset register.

Where the department is not the custodian of the completed project asset, the asset is

transferred to the custodian subsequent to completion.

16 Provisions and Contingents

16.1 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.

16.2 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.

16.3 Contingent assets

Contingent assets are recorded in the notes to the financial statements when a possible asset

arises from past events, and whose existence will be confirmed by the occurrence or non-

occurrence of one or more uncertain future events not within the control of the department.

16.4 Commitments

Commitments (other than for transfers and subsidies) 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.

17 Unauthorised expenditure

Unauthorised expenditure is recognised in the statement of financial position until such time as

the expenditure is either:

186



VOTE 3



- 47 -

• approved by the Provincial Legislature with funding and the related funds are received; or

• approved by 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.

18 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.

19 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.

20 Changes in accounting policies, accounting estimates and errors

Changes in accounting policies that are effected by management have been applied

retrospectively in accordance with MCS requirements, except to the extent that it is impracticable

to determine the period-specific effects or the cumulative effect of the change in policy. In such

instances the department shall restate the opening balances of assets, liabilities and net assets

for the earliest period for which retrospective restatement is practicable.

Changes in accounting estimates are applied prospectively in accordance with MCS

requirements.

Correction of errors is applied retrospectively in the period in which the error has occurred in

accordance with MCS requirements, except to the extent that it is impracticable to determine the

period-specific effects or the cumulative effect of the error. In such cases the department shall

restate the opening balances of assets, liabilities and net assets for the earliest period for which

retrospective restatement is practicable.

21 Events after the reporting date

Events after the reporting date that are classified as adjusting events have been accounted for in

the financial statements. The events after the reporting date that are classified as non-adjusting

events after the reporting date have been disclosed in the notes to the financial statements.

187



VOTE 3



- 48 -

22 Departures from the MCS requirements

Management has concluded that the financial statements present fairly the department’s primary

and secondary information; that the department complied with the Standard.

23 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 year. Amounts are either

transferred to the Provincial Revenue Fund when recovered or are transferred to the statement of

financial performance when written-off.

24 Employee benefits

The value of each major class of employee benefit obligation (accruals, payables not recognised

and provisions) is disclosed in the Employee benefits note.

188



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- 49 -

PART B: EXPLANATORY NOTES

1. Annual Appropriation

1.1 Annual Appropriation

Included are funds appropriated in terms of the Appropriation Act (and the Adjustments

Appropriation Act) for Provincial Departments (Voted funds):

1.2 Conditional grants

Note

2017/18 2016/17

R’000 R’000

Total grants received 47 2 000 2 790

Provincial grants included in Total Grants received 2 000 2 790

2. Departmental revenue

Note 2017/18 2016/17

R’000 R’000

Sales of goods and services other than capital

assets

2.1 12 218 10 428

Fines, penalties and forfeits 2.2 393 30

Interest, dividends and rent on land 2.3 28 28

Sales of capital assets 2.4 8 126 -

Transactions in financial assets and liabilities 2.5 1 169 850

Total revenue collected 21 934 11 336

Less: Own revenue included in appropriation 13 21 934 11 336

Departmental revenue collected - -

2017/18 2016/17

Final

Appropri

ation

Actual

Funds

Received

Funds not

requested/

not

received

Final

Appropriati

on

Appropria

tion

received

R’000 R’000 R’000 R’000 R’000

Administration 141 099 141 099 - 136 439 136 439

Environmental

Affairs

136 691 136 691 - 146 442 146 442

Economic and

Small Business

Development

218 167 218 167 - 114 378 114 378

Tourism 9 191 9 191 - 77 737 77 737

Total 505 148 505 148 - 474 996 474 996

189



VOTE 3



- 50 -

2.1 Sales of goods and services other than capital assets

Note 2017/18 2016/17

2 R’000 R’000

Sales of goods and services produced by the

department

12 210 10 401

Sales by market establishment - 20

Administrative fees 2 109 2 158

Other sales 10 101 8 223

Sales of scrap, waste and other used current

goods

8 27

Total 12 218 10 428

2.2 Fines, penalties and forfeits

Note 2017/18 2016/17

2 R’000 R’000

Fines 393 30

Total 393 30

2.3 Interest, dividends and rent on land

Note 2017/18 2016/17

2 R’000 R’000

Interest 28 28

Total 28 28

2.4 Sale of capital assets

Note 2017/18 2016/17

2 R’000 R’000

Tangible assets 8 126 -

Biological assets 27 8 126 -

Total 8 126 -

2.5 Transactions in financial assets and liabilities

Note 2017/18 2016/17

2 R’000 R’000

Receivables 1 159 846

Stale cheques written back 10 4

Total 1 169 850

190



VOTE 3



- 51 -

3. Aid assistance

2017/18 2016/17

R’000 R’000

Opening Balance 294 697

Prior period error - -

As restated 294 697

Transferred from statement of financial

performance

(51) (403)

Closing Balance 243 294

3.1 Analysis of balance by source

2017/18 2016/17

R’000 R’000

Aid assistance from other sources 243 294

Closing balance 243 294

3.2 Analysis of balance

2017/18 2016/17

Note R’000 R’000

Aid assistance unutilised 3 243 294


Aid assistance not requested/not received - -

3.3 Aid assistance expenditure per economic classification

2017/18 2016/17

R’000 R’000

Current 51 403

Total aid assistance expenditure 51 403

4. Compensation of employees

4.1 Salaries and Wages

2017/18 2016/17

R’000 R’000

Basic salary 160 344 148 640

Performance award 57 -

Service Based 430 1 106

Compensative/circumstantial 7 244 5 555

Periodic payments 1 237 -

Other non-pensionable allowances 32 051 32 636

Total 201 363 187 937

191



VOTE 3



- 52 -

4.2 Social contributions

2017/18 2016/17

R’000 R’000

Employer contributions

Pension 20 643 18 732

Medical 13 188 12 212

Bargaining council 55 49

Total 33 886 30 993

Total compensation of employees 235 249 218 930

Average number of employees 693 669

5. Goods and services

Note 2017/18 2016/17

R’000 R’000

Administrative fees 282 342

Advertising 5 378 4 004

Minor assets 5.1 749 311

Bursaries (employees) 410 211

Catering 5 014 2 604

Communication 4 262 5 512

Computer services 5.2 1 341 1 575

Consultants: Business and advisory services 5 534 11 810

Legal services 333 484

Contractors 8 131 6 233

Agency and support / outsourced services 13 094 5 289

Entertainment 14 -

Audit cost – external 5.3 6 467 5 146

Fleet services 12 538 8 354

Consumables 5.4 9 111 8 727

Operating leases 12 933 13 036

Property payments 5.5 10 021 7 378

Rental and hiring 522 24

Travel and subsistence 5.6 14 877 14 038

Venues and facilities 886 1 101

Training and development 2 532 2 317

Other operating expenditure 5.7 860 1 114

Total 115 289 99 610

192



VOTE 3



- 53 -

5.1 Minor assets

Note 2017/18 2016/17

5 R’000 R’000

Tangible assets

Machinery and equipment 749 311

Total 749 311

5.2 Computer services

Note 2017/18 2016/17

5 R’000 R’000

SITA computer services 1 020 722

External computer service providers 321 853

Total 1 341 1 575

5.3 Audit cost – External

Note 2017/18 2016/17

5 R’000 R’000

Regularity audits

Performance audits

6 426

41

5 146

-

Total 6 467 5 146

5.4 Consumables

Note 2017/18 2016/17

5 R’000 R’000

Consumable supplies 5 875 5 194

Uniform and clothing 1 366 1 533

Household supplies 1 101 1 087

Building material and supplies 1 819 1 380

IT consumables 57 94

Other consumables 1 532 1 100

Stationery, printing and office supplies 3 226 3 533

Total 9 111 8 727

5.5 Property payments

Note 2017/18 2016/17

5 R’000 R’000

Municipal Services 26 -

Property maintenance and repairs 9 985 7 341

Other 10 37

Total 10 021 7 378

193



VOTE 3



- 54 -

5.6 Travel and subsistence

Note 2017/18 2016/17

5 R’000 R’000

Local 11 955 12 256

Foreign 2 922 1 782

Total 14 877 14 038

5.7 Other operating expenditure

Note 2017/18 2016/17

5 R’000 R’000

Resettlement costs 31 224

Other 829 890

Total 860 1 114

6. Payments for financial assets

Note 2017/18 2016/17

R’000 R’000

Material losses through criminal conduct 22 143

Theft 6.2 22 143

Debts written off 6.1 19 264

Total 41 407

6.1 Debts written off

Note 2017/18 2016/17

6 R’000 R’000

Nature of debts written off

Recoverable revenue written off

Debt write-off 19 264

Total 19 264

6.2 Details of theft

Note 2017/18 2016/17

6 R’000 R’000

Nature of theft

Assets stolen from possession of officials and at

the resorts and reserves (i.e. laptops, desktops,

TV’s and decoder)

22 143

Total 22 143

194



VOTE 3



- 55 -

7. Transfers and subsidies

2017/18 2016/17

R’000 R’000

Note

Provinces and municipalities Annex 1A - 149

Departmental agencies and accounts Annex 1B 112 809 117 134

Public corporations and private enterprises Annex 1D 14 465 10 200

Households Annex 1G 1 630 1 194

Total 128 904 128 677

8. Expenditure for capital assets

Note 2017/18 2016/17

R’000 R’000

Tangible assets 9 443 15 452

Buildings and other fixed structures 29 3 893 13 124

Machinery and equipment 28 5 550 2 328

Total 9 443 15 452

8.1 Analysis of funds utilised to acquire capital assets – 2017/18

Voted funds Aid

assistance

Total

R’000 R’000 R’000

Tangible assets

Buildings and other fixed structures 3 893 - 3 893

Machinery and equipment 5 550 - 5 550

Total 9 443 - 9 443

8.2 Analysis of funds utilised to acquire capital assets – 2016/17

Voted funds Aid

assistance

Total

R’000 R’000 R’000

Tangible assets

Buildings and other fixed structures 13 124 - 13 124

Machinery and equipment 2 328 - 2 328

Total 15 452 - 15 452

195



VOTE 3



- 56 -

8.3 Finance lease expenditure included in Expenditure for capital assets

2017/18 2017/18

R’000 R’000

Tangible assets

Machinery and equipment 1 760 1 142

Total 1 760 1 142

9. Unauthorised expenditure

9.1 Reconciliation of unauthorised expenditure

Note 2017/18 2016/17

R’000 R’000

Opening balance - -

Prior period error -

As restated - -

Unauthorised expenditure – discovered in current

year (as restated)

1 167 -

Closing balance 1 167 -

Analysis of closing balance

Unauthorised expenditure awaiting authorisation 1 167 -

Total 1 167 -

9.2 Analysis of unauthorised expenditure awaiting authorisation per economic

classification

2017/18 2016/17

R’000 R’000

Current 1 167 -

Total 1 167 -

9.3 Analysis of unauthorised expenditure awaiting authorisation per type

2017/18 2016/17

R’000 R’000

Unauthorised expenditure relating to

overspending of the vote or a main division

within a vote

1 167 -

Total 1 167 -

196



VOTE 3



- 57 -

9.4 Details of unauthorised expenditure – current year

Incident Disciplinary steps taken/criminal

proceedings

2017/18

R’000

Overspending on a main division

within the vote

Under investigation 1 167

Total 1 167

9.5 Unauthorised expenditure split into current and non-current asset

2017/18 2016/17

Current Non-

current

Total Current Non-

current

Total

Details R’000 R’000 R’000 R’000 R’000 R’000

Overspending

on a main

division within

the vote

1 167 - 1 167

Total 1 167 - 1 167

10. Cash and cash equivalents

2017/18 2016/17

R’000 R’000

Consolidated Paymaster General Account 262 10 550

Disbursements 198 -

Cash on hand 70 70

Total 530 10 620

11. Prepayments and advances

2017/18 2016/17

R’000 R’000

Travel and subsistence 17 17

Prepayments (Not expensed) 13 600 -

Total 13 617 17

197



VOTE 3



- 58 -

11.1 Prepayments (Not expensed)

Amount as

at 1 April

2017

Less:

Received in

the current

year

Add: Current

Year

prepayments

Amount as

at 31 March

2018

R’000 R’000 R’000 R’000

Transfers and subsidies - - 13 600 13 600

Total - - 13 600 13 600

11.2 Prepayments (Expensed)

Amount as

at 1 April

2017

Less:

Received in

the current

year

Add: Current

Year

prepayments

Amount as

at 31 March

2018

R’000 R’000 R’000 R’000

Goods and services 17 467 467 17

Total 17 467 467 17

12. Receivables

2017/18 2016/17

Current Non-

current

Total Current Non-

current

Total

Note

R’000 R’000 R’000 R’000 R’000 R’000

Claims

recoverable

12.1

1 688 - 1 668 1 204 - 1 204

Recoverable

expenditure

12.2 158 - 158 49 - 49

Staff debt 12.3 239 598 837 394 335 729

Other

debtors

12.4 - 1 528 1 528 - 1 418 1 418

Total 2 065 2 126 4 191 1 647 1 753 3 400

12.1 Claims recoverable

Note 2017/18 2016/17

12 and Annex

4

R’000 R’000

Provincial departments 1 668 1 204

Total 1 668 1 204

198



VOTE 3



- 59 -

12.2 Recoverable expenditure (disallowance accounts)

Note 2017/18 2016/17

12 R’000 R’000

DISALL DAMAGES & LOSSES:CA 115 49

SAL:DEDUCTION DISALL ACC:CA 1 -

SAL:REVERSAL CONTROL:CA 33 -

SAL:TAX DEBT:CA 1 -

SAL:GEHS REFUND CONTROL ACC:CL 8 -

Total 158 49

12.3 Staff debt

Note 2017/18 2016/17

12 R’000 R’000

Bursary debt(employee and non-employee) 194 184

Cellphone debt - 4

Communication debt 109 113

Employee debt 29 48

Ex- employee debt 76 73

Salary overpayment 364 239

Tax debt 23 28

Losses 42 40

837 729

12.4 Other debtors

Note 2017/18 2016/17

12 R’000 R’000

Supplier 1 528 1 418

Total 1 528 1 418

12.5 Impairment of receivables

2017/18 2016/17

R’000 R’000

Estimate of impairment of receivables 1 536 1 422

Total 1 536 1 422

The basis for the impairment is based on debts older than 3 years excluding the debts with

active instalment repayments.

199



VOTE 3



- 60 -

13. Voted funds to be surrendered to the Revenue Fund

2017/18 2016/17

R’000 R’000

Opening balance 11 920 5 374


As restated 11 920 5 374

Transfer from statement of financial performance

(as restated)

16 222 11 920

Add: Unauthorised expenditure for current year 1 167

Paid during the year (11 920) (5 374)

Closing balance 17 389 11 920

14. Departmental revenue and NRF Receipts to be surrendered to the Revenue

Fund

2017/18 2016/17

R’000 R’000

Opening balance 894 1 115


As restated 894 1 115

Own revenue included in appropriation 21 934 11 336

Paid during the year (22 027) (11 557)


15. Payables – current

Note 2017/18 2016/17

R’000 R’000

Clearing accounts 15.1 6 -

Total 6 -

15.1 Clearing accounts

Note 2017/18 2016/17

15 R’000 R’000

SAL:ACB RECALLS:CA 6 -

Total 6 -

200



VOTE 3



- 61 -

16. Net cash flow available from operating activities

2017/18 2016/17

R’000 R’000

Net surplus/(deficit) as per Statement of Financial

Performance

16 171 11 517

Add back non cash/cash movements not deemed

operating activities

(25 081) 9 929

(Increase)/decrease in receivables – current (791) 52

(Increase)/decrease in prepayments and advances (13 600) 20

Increase/(decrease) in payables – current 6 -

Proceeds rom sale of capital assets (8 126) -

Expenditure on capital assets 9 443 15 452

Surrenders to Revenue Fund (33 947) (16 931)

Own revenue included in appropriation 21 934 11 336

Net cash flow generated by operating activities (8 910) 21 446

17. Reconciliation of cash and cash equivalents for cash flow purposes

2017/18 2016/17

R’000 R’000

Consolidated Paymaster General account 262 10 550

Disbursements 198 -

Cash on hand 70 70

Total 530 10 620

18. Contingent liabilities and contingent assets


Note 2017/18 2016/17

R’000 R’000

Liable to Nature

Claims against the department Annex 3B 24 713 24 713

Intergovernmental payables (unconfirmed

balances)

Annex 5 - 29

Total 24 713 24 742

201



VOTE 3



- 58 -

18. Contingent liabilities and contingent assets


Note 2017/18 2016/17

R’000 R’000

Liable to Nature

Claims against the department Annex 3B 24 713 24 713

Intergovernmental payables (unconfirmed

balances)

Annex 5 - 29

Total 24 713 24 742

19. Commitments

2017/18 2016/17

R’000 R’000

Current expenditure

Approved and contracted 9 914 22 940

Approved but not yet contracted 913 688

10 827 23 628

Capital expenditure

Approved and contracted 13 307 17 045

Approved but not yet contracted 148 19

13 455 17 064

Total Commitments 24 282 40 692

Going concern assumption - The department will continue to operate in the foreseeable future without the need

or intention to liquidate or significantly curtail its operational activities. However, due to the commitments as at

year end, there is significant doubt on the department’s ability to meet its financial obligations as they fall due

and achievement of service delivery as outlined in the Annual Performance Plan.

Construction of Fence at Sandveld Nature Reserve contract, Implementation, Coordination and Management of

the Free State Programme to Clean Up Water Resources (Dams & Rivers) and Exhibition Management Services

is for longer than 1 year.

202



VOTE 3



- 59 -

20. Accruals and payables not recognised

20.1 Accruals

2017/18 2016/17

R’000 R’000

Listed by economic classification

30 Days 30+ Days Total Total

Goods and services 5 522 - 5 522 576

Total 5 522 - 5 522 576

2017/18 2016/17

R’000 R’000

Listed by programme level

Administration 4 632 -

Environmental Affairs 84 -

Economic Development 806 576

Tourism - -

Total 5 522 576

20.2 Payables not recognised

2017/18 2016/17

R’000 R’000

Listed by economic classification

30 Days 30+ Days Total Total

Goods and services 486 - 486 1 622

Total 486 - 486 1 622

2017/18

2016/17

R’000 R’000

Listed by programme level

Administration 105 1 427

Environmental Affairs - 91


Tourism

381

-

60

44

Total 486 1 622

Note

2017/18

2016/17

Included in the above totals are the following: R’000 R’000

Confirmed balances with other departments Annex 5 24 624

Total 24 624

203



VOTE 3



- 64 -

21. Employee benefits

2017/18 2016/17

R’000 R’000

Leave entitlement 11 626 9 314

Service bonus (Thirteenth cheque) 6 496 5 704

Performance awards 9 117 1 557

Capped leave commitments 6 183 6 671

Other 501 144

Total 33 923 23 990

At this stage the department is not able to reliably measure the long term portion of the long

service awards.

Included in leave entitlement are negative leave credits amounting to R189 651.51. Other

employee benefits includes overtime due as at 31 March 2018 and the payment of the 10%

HOD allowance.

22. Lease commitments

22.1 Operating leases

2017/18

Specialised

military

equipment

Land

Buildings

and other

fixed

structures

Machinery

and

equipment

Total

Not later than 1 year - - - 10 882 10 882

Later than 1 year and

not later than 5 years

- - - 10 813 10 813

Total lease

commitments

- - - 21 695 21 695

2016/17

Specialised

military

equipment

Land

Buildings

and other

fixed

structures

Machinery

and

equipment

Total




- - - 6 251 6 251

Later than five years - - - 63 63

Total lease

commitments

- - - 14 502 14 502

204



VOTE 3



- 65 -

The major operating lease arrangement of the department is for the government owned

vehicles that are being leased from Fleet Management.

22.2 Finance leases

2017/18

Specialised

military

equipment

Land

Buildings

and other

fixed

structures

Machinery

and

equipment

Total




- - - 517 517

Total lease

commitments

- - - 1 733 1 733

2016/17

Specialised

military

equipment

Land

Buildings

and other

fixed

structures

Machinery

and

equipment

Total

Not later than 1 year - - - 768 768



- - - 593 593

Total lease

commitments - - - 1 361 1 361

The major lease arrangement for the department is for the photocopiers.

23. Accrued departmental revenue

2017/18 2016/17

R’000 R’000

Sales of goods and services other than capital

assets

20 349 18 167

Sales of capital assets 619 -

Total 20 968 18 167

205



VOTE 3



- 66 -

23.1 Analysis of accrued departmental revenue

2017/18 2016/17

R’000 R’000


Add: amounts recorded 2 801 3 663


23.2 Impairment of accrued departmental revenue

2017/18 2016/17

R’000 R’000

Estimate of impairment of accrued departmental

revenue

10 863 7 609

Total 10 863 7 609

The basis of impairment is calculated on the R150 000 monthly rental out of the original R250,000.

Only R100 000 may be recoverable and the R150 000 deemed irrecoverable from the service provider.

24. Irregular expenditure

24.1 Reconciliation of irregular expenditure

2017/18 2016/17

R’000 R’000


Prior period error 594

As restated 78 382 70 074

Add: Irregular expenditure – relating to prior year 9 171 -

Add: Irregular expenditure – relating to current

year

11 787 8 308

Less: Prior year amounts condoned (2 084) -


Analysis of awaiting condonation per age

classification

Current year 11 787 8 308

Prior years 85 469 70 074

Total 97 256 78 382

206



VOTE 3



- 67 -

24.2 Details of irregular expenditure – added current year (relating to current and prior

years)


proceedings

2017/18

R’000

Travel agent used instead of

sourcing quotations

Under investigation 540

Supplier not on CSD and not

approved at appropriate level

Under investigation 30

No deviation for obtaining one

quotation

Approval by delegated official

after payment was made -

BBEEE certificate not attached

Under investigation

Under investigation

14

520

Quotations, BBEEE, tax, SBD,

approval, prospective suppliers

SCM processes not followed for

NTCE

Addition made to contract via a

variation order (Soetdoring)

Expenditure incurred on expired

transversal contract which was

extended on month to month

basis.

75% of procurement relating to

the advertising of posts at the

OPM was through deviations and

the reasons provided were

invalid, deviations were not due

to emergency or sole supplier

cases and it was neither

impractical for the department to

follow bidding process. In certain

instances, suppliers that were

used for advertising were also

not registered on the central

supplier database.

Quotations not obtained

Expenditure incurred on expired

transversal contract which was

extended on month to month

basis.

Under investigation

Under investigation

Under investigation

Under investigation

Under investigation

Under investigation

Under investigation

444

12 015

1 330

1 258

1 435

1 043

2 329

TOTAL 20 958

207



VOTE 3



- 68 -

24.3 Details of irregular expenditure condoned

Incident Condoned by (condoning authority) 2017/18

R’000

Payments relating to Event

Management Transversal

Contract which were not part of

the events transversal contract

pricing list.

National Treasury 2 084

Total 2 084

24.4 Details of irregular expenditures under determination or investigation (not included

in the main note)

Incident 2017/18

R’000

Splitting of orders 1 446

Tender not advertised for 21 Days 1 596

Total 3 042

24.5 Prior period error

2016/17

R’000

Nature of prior period error

Relating to 2014/15 – 2016/17 [affecting the

opening balance]

594

Payments relating to Event Management

Transversal Contract which were not part of the

events transversal contract pricing list.

594

Total prior period errors 594

25. Fruitless and wasteful expenditure

208



VOTE 3



- 65 -

25. Fruitless and wasteful expenditure

25.1 Reconciliation of fruitless and wasteful expenditure

2017/18 2016/17

R’000 R’000

Opening balance - 105

Prior period error

As restated - 105

Fruitless and wasteful expenditure – relating to

prior year

2 205

Less: Amounts transferred to receivables for

recovery

11.6 - 105

Closing balance 2 205 -

25.2 Analysis of awaiting resolution per economic classification

25.3 Analysis of Current year’s (relating to current and prior years) fruitless and wasteful

expenditure


proceedings

2017/18

R’000

Penalties and interest incurred

due to late payment of contractor.

Under investigation 2 205

Total 2 205

25.4 Details of fruitless and wasteful expenditures under investigation (not included in the

main note)

Incident 2017/18

R’000

Possible fruitless and wasteful expenditure on the work done on a project

that was suspended. The amount cannot be determined at this stage until

the final account is received for this project.

Total -

2017/18 2016/17

R’000 R’000

Capital 2 205 -

Total 2 205 -

209



VOTE 3



- 70 -

26. Key management personnel

No. of

Individuals

2017/18 2016/17

R’000 R’000

Political office bearers (provide detail below) 1 1 978 2 138

Officials:

Level 15 to 16 3 2 855 4 346

Level 14 (incl. CFO if at a lower level) 7 7 924 8 077

Total 12 757 14 561

27. Provisions

2017/18 2016/17

R’000 R’000

Retention monies - 243

Total - 243

27.1 Reconciliation of movement in provisions – 2017/18

Provision

1

Provision

2

Provision

3

Total

provisions

R’000 R’000 R’000 R’000

Opening balance 243 - - 243

Settlement of provision (243) - - (243)

Closing balance - - - -

Reconciliation of movement in provisions – 2016/17

Provision

1

Provision

2

Provision

3

Total

provisions

R’000 R’000 R’000 R’000

Opening balance 243 - - 243

Closing balance 243 - - 243

210



VOTE 3



- 71 -

The provision relates to retention monies on the Maria Moroka project. The retention is 10% of the

amount that was certified as being due to the contractor on the interim certificate, which was deducted

from the amount due and retained by the department. The purpose of retention is to ensure that the

contractor properly completes the activities required of them under the contract.

The amount retained was released as the contract has reached practical completion which means the

point where all building work is complete or all but completed, in accordance with the contract, and

the property is reasonably fit for occupation.

28. Movable Tangible Capital Assets

MOVEMENT IN MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR

ENDED 31 MARCH 2018

Opening

balance

Value

adjustments

Additions Disposals Closing

Balance

R’000 R’000 R’000 R’000 R’000

MACHINERY AND

EQUIPMENT

31 377 - 3 792 1 391 33 314

Transport assets 5 527 - - 779 4 748

Computer equipment 9 600 - 1 492 7 11 085

Furniture and office equipment 8 626 - 1 268 - 9 894

Other machinery and equipment 7 624 - 568 605 7 587

SPECIALISED MILITARY

ASSETS

1 036 - - - 1 036

Specialised military assets 1 036 - - - 1 036

TOTAL MOVABLE TANGIBLE

CAPITAL ASSETS

32 413 - 3 328 1 391 34 350

Movable Tangible Capital Assets under investigation

Number Value

R’000

Included in the above total of the movable tangible capital assets per the

asset register are assets that are under investigation:

Machinery and equipment 318 4 762

1. Some of the assets under investigation could not been found during the Asset

Verification process. For these assets further investigations will be conducted with

respective asset holders so that all assets are accounted for.

2. Some the assets under investigation include those assets that were transferred to resorts

and reserves during the movement.



VOTE 3



- 67 -

contractor properly completes the activities required of them under the contract.

The amount retained was released as the contract has reached practical completion which means the

point where all building work is complete or all but completed, in accordance with the contract, and

the property is reasonably fit for occupation.

28. Movable Tangible Capital Assets

MOVEMENT IN MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR

ENDED 31 MARCH 2018

Opening

balance

Value

adjustments


Balance

R’000 R’000 R’000 R’000 R’000

MACHINERY AND

EQUIPMENT

31 377 - 3 792 1 391 33 314

Transport assets 5 527 - - 779 4 748

Computer equipment 9 600 - 1 492 7 11 085

Furniture and office equipment 8 626 - 1 268 - 9 894



ASSETS

1 036 - - - 1 036



CAPITAL ASSETS

32 413 - 3 328 1 391 34 350

Movable Tangible Capital Assets under investigation

Number Value

R’000

Included in the above total of the movable tangible capital assets per the

asset register are assets that are under investigation:

Machinery and equipment 318 4 762




2. Some of the assets under investigation include those assets that were transferred to

resorts and reserves during the movement.

211



VOTE 3



- 72 -

28.1 Additions

ADDITIONS TO MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE

YEAR ENDED 31 MARCH 2018

Cash* Non-

cash**

(Capital

Work in

Progress

current

costs and

finance

lease

payments)

Received

current,

not paid

(Paid

current

year,

received

prior year)

Total

R’000 R’000 R’000 R’000 R’000

MACHINERY AND

EQUIPMENT

5 088 (1 760) - 3 328

Computer equipment 1 492 - - - 1 492

Furniture and office equipment 1 268 - - - 1 268

Other machinery and

equipment

2 328 - (1 760) - 568

TOTAL ADDITIONS TO

MOVABLE TANGIBLE

CAPITAL ASSETS

5 088 - (1 760) - 3 328

28.2 Disposals

DISPOSALS OF MOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR

THE YEAR ENDED 31 MARCH 2018

Sold for

cash

Non-cash

disposal

Total

disposals

Cash

Received

Actual

R’000 R’000 R’000 R’000

MACHINERY AND EQUIPMENT - 1 391 1 391 -

Transport assets - 779 779 -

Computer equipment - 7 7 -

Furniture and office equipment - - - -

Other machinery and equipment - 605 605 -

BIOLOGICAL ASSETS

Biological assets 8 126

TOTAL DISPOSAL OF

MOVABLE TANGIBLE CAPITAL

ASSETS

- 1 391 1 391 8 126

212



VOTE 3



- 73 -

28.3 Movement for 2016/17

MOVEMENT IN TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR THE YEAR ENDED 31

MARCH 2017

Opening

balance

Prior

period

error


Balance

R’000 R’000 R’000 R’000 R’000

MACHINERY AND

EQUIPMENT

30 164 404 1 328 519 31 377

Transport assets 5 153 404 - 30 5 527

Computer equipment 8 902 704 6 9 600

Furniture and office equipment 8 537 - 89 - 8 626



ASSETS

1 036 - - - 1 036



CAPITAL ASSETS

31 200 404 1 328 519 32 413

28.3.1 Prior period error

2016/17

R’000

Nature of prior period error

Relating to 2015/16 [affecting the opening balance]

Tractors not included in opening balance 404

Total prior period errors 404

213



VOTE 3



- 74 -

28.4 Minor assets

MOVEMENT IN MINOR ASSETS PER THE ASSET REGISTER FOR THE YEAR ENDED AS AT 31

MARCH 2018

Specialised

military

assets

Intangible

assets

Heritage

assets

Machinery

and

equipment

Biological

assets

Total

R’000 R’000 R’000 R’000 R’000 R’000

Opening

balance

314 - - 26 121 - 26 435

Value

adjustments

- - - - - -

Additions - - - 737 - 737

Disposals 128 128

TOTAL MINOR

ASSETS

314 - - 26 730 - 27 044

Specialised

military

assets

Intangible

assets

Heritage

assets

Machinery

and

equipment

Biological

assets

Total

Number of R1

minor assets

- - - 1 - 1

Number of

minor assets

at cost

129 - - 17 308 - 17 437

TOTAL

NUMBER OF

MINOR

ASSETS

129 - - 17 309 - 17 438

Minor Capital Assets under investigation

Number Value

R’000

Included in the above total of the minor capital assets per the asset

register are assets that are under investigation:

Machinery and equipment 1 644 2 579




2. Some the assets under investigation include those assets that were transferred to resorts

and reserves during the movement.

214



VOTE 3



- 75 -

MOVEMENT IN MINOR ASSETS PER THE ASSET REGISTER FOR THE YEAR ENDED AS AT 31

MARCH 2017

Specialised

military

assets

Intangible

assets

Heritage

assets

Machinery

and

equipment

Biological

assets

Total

R’000 R’000 R’000 R’000 R’000 R’000

Opening

balance

314 - - 25 910 - 26 224

Prior period

error

- - - - - -

Additions - - - 337 - 337

Disposals - - - 126 - 126

TOTAL MINOR

ASSETS

314 - - 26 121 - 26 435

Specialised

military

assets

Intangible

assets

Heritage

assets

Machinery

and

equipment

Biological

assets

Total

Number of R1

minor assets

- - - 1 - 1

Number of

minor assets

at cost

129 - - 17 308 - 17437

TOTAL

NUMBER OF

MINOR

ASSETS

129 - - 17 309 - 17 438

215



VOTE 3



- 76 -

29. Immovable Tangible Capital Assets

29.1 Additions

ADDITIONS TO IMMOVABLE TANGIBLE CAPITAL ASSETS PER ASSET REGISTER FOR

THE YEAR ENDED 31 MARCH 2018

Cash Non-cash (Capital

Work in

Progress

current

costs and

finance

lease

payments)

Received

current,

not paid

(Paid

current

year,

received

prior year)

Total

R’000 R’000 R’000 R’000 R’000

BUILDING AND OTHER

FIXED STRUCTURES

Other fixed structures 4 100 (4 100) -

TOTAL ADDITIONS TO

IMMOVABLE TANGIBLE

CAPITAL ASSETS

4 100 (4 100) -

29.2 Capital Work-in-progress

CAPITAL WORK-IN-PROGRESS AS AT 31 MARCH 2018

Note

Opening

balance

1 April

2017

Current

Year WIP

Ready for

use

(Assets to

the AR) /

Contracts

terminated

Closing

balance

31 March

2018

Annexure 7 R’000 R’000 R’000 R’000

Buildings and other fixed

structures

56 926 4 100 - 61 026

TOTAL 56 926 4 100 - 61 026

216



VOTE 3



- 77 -

Age analysis on ongoing projects

Number of projects 2017/18

Planned,

Construction not

started

Planned,

Construction

started

Total

R’000

0 to 1 Year - - -

1 to 3 Years - 1 5 535

3 to 5 Years - 2 31 324

Longer than 5 Years - 1 24 167

Total - 4 61 026

Maria Moroka Resort - The project is on a Practical Completion stage and the retention

monies have been paid.

Accruals and payables not recognised relating to

Capital WIP Note 2017/18 2016/17

R’000 R’000

Maria Moroka Project 115

Total 115 -

CAPITAL WORK-IN-PROGRESS AS AT 31 MARCH 2017

Note

Opening

balance

1 April

2016

Prior

period

error

Current

Year WIP

Ready for

use

(Assets to

the AR) ) /

Contracts

terminated

Closing

balance

31 March

2017

Annexure 7 R’000 R’000 R’000 R’000 R’000

Buildings and

other fixed

structures

43 802 - 13 124 - 56 926

TOTAL 43 802 - 13 124 - 56 926

217



VOTE 3



- 78 -

30. Prior period errors

30.1 Correction of prior period errors

Note Amount bef

error

correction

Prior period

error

Restated

Amount

2016/17 2016/17 2016/17

R’000 R’000 R’000

Expenditure:

Goods and Services

Payment made to service provider

for MESP incorrectly classified as a

transfer payment instead of goods

and services.

5 87 047 12 563 99 610

Transfers and subsidies 7 141 240 (12 563) 128 677

Payment made to service provider

for MESP incorrectly classified as a

transfer payment instead of goods

and services.

Net effect 228 287 - 228 287


Note Amount bef

error

correction

Prior period

error

Restated

Amount

2016/17 2016/17 2016/17

R’000 R’000 R’000

Other:

Liabilities

Accruals – payments due to service

provider for services rendered

20.1 - 576 576

Net effect - 576 576

218



VOTE 3



- 79 -


Note Amount bef

error

correction

Prior period

error

Restated

Amount

2016/17 2016/17 2016/17

R’000 R’000 R’000

Other:

Fruitless Expenditure

Payments relating to Event

Management Transversal Contract

which were not part of the events

transversal contract pricing list.

23 1 490 594 2 084

S42 Movable Capital Assets 39.6 379 (379) -

The baler machines were already

transferred in terms of S42 during

the 2016/17 financial year.

Net effect 1 869 215 2 084

Payments relating to Event Management Transversal Contract which were not part of the

events transversal contract pricing list.

219

DE

PA

RT

ME

NT

OF

EC

ON

OM

IC,

SM

AL

L B

US

INE

SS

DE

VE

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PM

EN

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d 3

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31.

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on

s

The

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e S

tate

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un

cil

ap

pro

ve

d o

n 1

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r 2

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o t

ran

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ction

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hic

h f

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r

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on

me

nta

l M

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age

me

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to t

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ep

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nt

of

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lture

and

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ral D

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pm

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t w

ith

eff

ect fr

om

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er

20

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e

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to

the

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nt

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nt,

it

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ate

tha

t th

e a

ffecte

d o

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ials

be t

ransfe

rre

d.

Sectio

n 1

4 (

4)

of

the

Pub

lic S

erv

ice A

ct,

199

4,

as a

me

nd

ed,

wa

s

ad

he

red

to.

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rtm

ent

of

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ricu

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nd

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l D

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ng

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d a

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t th

e t

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r o

f K

are

e N

urs

ery

an

d i

ts p

ers

on

nel

to t

heir

dep

art

me

nt

an

d it

wa

s a

gre

ed t

ha

t th

e a

ffe

cte

d o

ffic

ials

wo

uld

assu

me

du

ty in t

he D

ep

art

men

t w

ith

eff

ect

from

01 N

ove

mb

er

201

7.

Th

e t

wo

re

co

gnis

ed

un

ion

s

in t

he D

ep

art

me

nt,

na

me

ly P

SA

an

d N

EH

AW

U,

we

re e

nga

ge

d a

bo

ut

the

tra

nsfe

r o

f K

are

e N

urs

ery

du

rin

g t

he

sp

ecia

l D

TT

mee

tin

gs h

eld

on 2

4

an

d 3

0 O

cto

ber

20

17

re

sp

ectively

. T

he

tw

o u

nio

ns a

gre

ed

to t

he

tra

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r.

The

co

mp

en

satio

n b

udg

et

for

the

re

ma

ind

er

of

the f

ina

ncia

l ye

ar

from

01 N

ove

mb

er

201

7 t

o 3

1 M

arc

h 2

01

7,

wh

ich

am

ou

nts

to

R2

370

67

8.0

0 w

ill

be

tra

nsfe

rred

to

th

e D

epa

rtm

ent

of

Ag

ricultu

re a

nd

Rura

l D

eve

lop

me

nt

in A

pri

l 2

018

.

31.1

S

tate

me

nt

of

Fin

an

cia

l P

os

itio

n

N

ote

B

al

per

dep

t

20

16

/17 A

FS

be

fore

tra

nsfe

r

Fu

ncti

on

s

pe

r d

ep

t

(tra

nsfe

rre

d

) /

rec

eiv

ed

Fu

nc

tio

ns

pe

r d

ep

t

(tra

ns

ferr

ed

) /

rec

eiv

ed

Fu

nc

tio

ns

pe

r d

ep

t

(tra

ns

ferr

ed

) /

rec

eiv

ed

20

16

/17 B

al

aft

er

tra

ns

fer

20

16

/17

20

16

/17

201

6/1

7

20

16

/17

20

16

/17

R’0

00

R

’00

0

R’0

00

R

’00

0

R’0

00

AS

SE

TS

Cu

rre

nt

As

se

ts

1

2 2

84

-

- -

12 2

84

Ca

sh

an

d c

ash

eq

uiv

ale

nts

10

620

-

- -

10 6

20

Pre

pa

ym

en

ts a

nd

ad

va

nce

s

17

-

- -

17

Re

ce

iva

ble

s

1

64

7

- -

- 1 6

47

220

DE

PA

RT

ME

NT

OF

EC

ON

OM

IC,

SM

AL

L B

US

INE

SS

DE

VE

LO

PM

EN

T,

TO

UR

ISM

AN

D E

NV

IRO

NM

EN

TA

L A

FF

AIR

S

VO

TE

3

NO

TE

S T

O T

HE

AN

NU

AL

FIN

AN

CIA

L S

TA

TE

ME

NT

S

for

the

ye

ar

en

de

d 3

1 M

arc

h 2

01

8

- 8

1 -

No

n-C

urr

en

t A

sse

ts

Re

ce

iva

ble

s

1

75

3

- -

- 1 7

53

TO

TA

L A

SS

ET

S

1

4 0

37

-

- -

14 0

37

LIA

BIL

ITIE

S

Cu

rre

nt

Lia

bil

itie

s

Vote

d f

un

ds t

o b

e s

urr

en

de

red

to t

he

Reve

nu

e F

un

d

1

1 9

20

-

- -

11 9

20

De

pa

rtm

en

tal

reve

nu

e

an

d

NR

F

Re

ceip

ts

to

be

su

rre

nd

ere

d t

o t

he

Reve

nu

e F

un

d

8

94

-

- -

894

Aid

assis

tan

ce

un

utilis

ed

29

4

- -

- 2

94

TO

TA

L L

IAB

ILIT

IES

13

108

-

- -

13 1

08

NE

T A

SS

ET

S

9

29

-

- -

929

221

DE

PA

RT

ME

NT

OF

EC

ON

OM

IC,

SM

AL

L B

US

INE

SS

DE

VE

LO

PM

EN

T,

TO

UR

ISM

AN

D E

NV

IRO

NM

EN

TA

L A

FF

AIR

S

VO

TE

3

NO

TE

S T

O T

HE

AN

NU

AL

FIN

AN

CIA

L S

TA

TE

ME

NT

S

for

the

ye

ar

en

de

d 3

1 M

arc

h 2

01

8

- 7

7 -

31.2

N

ote

s

N

ote

B

al

pe

r d

ep

t

20

16

/17

AF

S

be

fore

tra

ns

fer

Fu

nc

tio

ns

per

de

pt

(tra

ns

ferr

ed

) /

rece

ive

d

Fu

nc

tio

ns

pe

r d

ep

t

(tra

nsfe

rred

) /

rec

eiv

ed

Fu

nc

tio

ns

pe

r d

ep

t

(tra

ns

ferr

ed

) /

rec

eiv

ed

20

16

/17

Ba

l

aft

er

tra

ns

fer

20

16

/17

20

16

/17

20

16

/17

20

16

/17

20

16

/17

R’0

00

R

’00

0

R’0

00

R

’00

0

R’0

00

Co

ntin

ge

nt

liab

ilities

2

4 7

13

-

- -

24 7

13

Co

mm

itm

en

ts

4

0 6

92

-

- -

40 6

92

Pa

ya

ble

s n

ot

reco

gn

ise

d

1

62

2

- -

- 1 6

22

Em

plo

ye

e b

en

efits

23

39

0

- -

- 2

3 3

90

Le

ase

co

mm

itm

en

ts –

Op

era

tin

g le

ase

14

50

2

- -

- 1

4 5

02

Le

ase

co

mm

itm

en

ts –

Fin

an

ce

lea

se

1 3

61

-

- -

1 3

61

Accru

ed

de

part

me

nta

l re

ve

nu

e

1

8 1

67

-

- -

18 1

67

Irre

gu

lar

exp

en

ditu

re

7

7 7

88

-

- -

77 7

88

Pro

vis

ion

s

2

43

-

- -

243

Mo

va

ble

ta

ng

ible

ca

pita

l asse

ts

5

9 3

30

-

- -

59 3

30

Pro

vid

e a

de

scri

ptio

n o

f a

ctio

ns t

aken

to

en

su

re c

om

plia

nce w

ith t

he

PF

MA

S4

2

All

reco

rds o

f a

ffe

cte

d o

ffic

ials

(th

is is in

clu

siv

e o

f a

ll H

R a

nd

PE

RS

AL f

iles a

nd

re

co

rds)

will

be

tra

nsfe

rre

d t

o A

gri

cu

ltu

re a

nd

Ru

ral D

eve

lop

me

nt

an

d a

lis

t of

all

off

icia

ls t

o b

e t

ran

sfe

rre

d h

as b

een

dra

wn u

p.

All

mo

va

ble

asse

ts w

ill b

e t

ransfe

rre

d t

o D

ep

art

me

nt

of

Ag

ricultu

re a

nd

Ru

ral D

eve

lop

me

nt

an

d a

lis

t of

all

asse

ts t

o b

e tra

nsfe

rred

ha

s b

ee

n

dra

wn

up

for

the s

igna

ture

of

DE

ST

EA

HO

D a

nd a

cce

pta

nce b

y th

e H

OD

of

Agri

cu

lture

and

Ru

ral D

evelo

pm

en

t.

222

DE

PA

RT

ME

NT

OF

EC

ON

OM

IC,

SM

AL

L B

US

INE

SS

DE

VE

LO

PM

EN

T,

TO

UR

ISM

AN

D E

NV

IRO

NM

EN

TA

L A

FF

AIR

S

VO

TE

3

NO

TE

S T

O T

HE

AN

NU

AL

FIN

AN

CIA

L S

TA

TE

ME

NT

S

for

the

ye

ar

en

de

d 3

1 M

arc

h 2

01

8

- 8

3 -

Pro

vid

e a

refe

ren

ce

to t

he p

rocla

ma

tion

or

decla

ration

giv

ing

eff

ect

to t

he t

ran

sfe

r or

rece

ipt

of

fun

ctio

ns

Fre

e S

tate

Exe

cu

tive C

ou

ncil

resolu

tion

ap

pro

ved

by t

he

Pre

mie

r, M

r E

S M

ag

ash

ule

, o

n 1

0 O

cto

be

r 2

01

7.

Ind

ica

te w

he

ther

the

re w

as a

n a

gre

em

en

t dra

wn u

p,

and p

rovid

e a

de

scri

ptio

n o

f ro

les,

resp

onsib

ilitie

s a

nd a

cco

un

tabili

ty a

rra

ng

em

en

ts.

A s

ubm

issio

n f

or

the

tra

nsfe

r o

f off

icia

ls t

o t

he

De

pa

rtm

ent

of

Ag

ricultu

re a

nd

Rura

l D

eve

lop

me

nt

wa

s a

pp

rove

d b

y t

he

DE

ST

EA

ME

C,

ME

C B

Ma

lako

an

e,

on 1

4 D

ece

mbe

r 2

01

7.

It w

as c

lea

rly s

tate

d t

hat

the

co

nd

itio

ns o

f e

mp

loym

en

t fo

r th

e t

ran

sfe

rred

off

icia

ls w

ill n

ot,

in

an

y w

ay,

be

ne

ga

tive

ly a

ffe

cte

d a

s t

he

y w

ill r

eta

in t

he

ir c

urr

en

t sala

rie

s a

nd

be

ne

fits

.

223

DE

PA

RT

ME

NT

OF

EC

ON

OM

IC,

SM

AL

L B

US

INE

SS

DE

VE

LO

PM

EN

T,

TO

UR

ISM

AN

D E

NV

IRO

NM

EN

TA

L A

FF

AIR

S

VO

TE

3

NO

TE

S T

O T

HE

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Depart

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24

624

-

29

24

653

231



VOTE 3

ANNEXURES TO THE ANNUAL FINANCIAL STATEMENTS


- 92 -

ANNEXURE 7 MOVEMENT IN CAPITAL WORK IN PROGRESS

MOVEMENT IN CAPITAL WORK IN PROGRESS FOR THE YEAR ENDED 31 MARCH 2018

Opening

balance

Current

Year

Capital

WIP

Ready for

use (Asset

register) /

Contract

terminated

Closing

balance

R’000 R’000 R’000 R’000

BUILDINGS AND OTHER FIXED STRUCTURES

Other fixed structures 56 926 4 100 61 026

TOTAL 56 926 4 100 61 026

Age analysis on ongoing projects

Number of projects 2016/17

Planned,

Construction

not started

Planned,

Construction

started

Total

R’000

0 to 1 Year -

1 to 3 Years 1 5 535

3 to 5 Years 2 31 324

Longer than 5 Years 1 24 164

Total 4 61 026

Include discussion on projects longer than 5 years in Capital WIP

Maria Moroka Resort - The project is on a Practical Completion stage and the retention monies have

been paid.

MOVEMENT IN CAPITAL WORK IN PROGRESS FOR THE YEAR ENDED 31 MARCH 2017

Opening

balance

Prior

period

error

Current

Year

Capital

WIP

Ready for

use (Asset

register) /

Contract

terminated

Closing

balance

R’000 R’000 R’000 R’000 R’000

BUILDINGS AND OTHER FIXED

STRUCTURES

Other fixed structures 43 802 - 13 124 - 56 926

TOTAL 43 802 - 13 124 - 56 926

232

NOTES

233

NOTES

234

NOTES

235

NOTES

236

NOTES

237

NOTES

238

NOTES

239

NOTES

240

NOTES

VOTE NO. 3


DEPARTMENT OF ECONOMIC, SMALL BUSINESS DEVELOPMENT, TOURISM AND ENVIRONMENTAL AFFAIRS

FREE STATE PROVINCE

Free State Departm

ent of Economic, Sm

all Business Developm

ent, Tourism and Environm

ental Aff

airs Annual Report 2017/ 2018

Free State Department of Economic, Small Business Development, Tourism and

Environmental Affairs Annual Report 2017/ 2018

Physical: 113 St Andrew Street, Bloemfontein, 9300

Postal: P.O. Box X20801, Bloemfontein, 9300

Tel: (051) 400 9542Email: [email protected]

Website: www.detea.fs.gov.za

PR305/2018ISBN: 978-0-621-46603-4

2018 free state economic small business development

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