portfolio committee on trade and industry 17 april 2013

Portfolio Committee on Trade and IndustryPortfolio Committee on Trade and Industry17 April 201317 April 2013

Annual Performance Plan 2013/14 - 2015/16 & Business Plan 2013/14

Mr. Prags Govender

Chairperson (016) 430 8823

[email protected]

Ron Josias CEO(012) 394 3760

[email protected]

mailto:[email protected]

AcronymsAcronyms AFRAC African Accreditation Cooperation MTEF Medium-term Expenditure Framework

B-BBEE Broad-based Black Economic Empowerment

NDT National Department of Tourism

CEM Customer Experience Measure NNR National Nuclear Regulator

CEO Chief Executive Officer NRCS National Regulator for Compulsory Standards

CFO Chief Financial Officer OECD Organisation for Economic Cooperation and

EAC Eastern African Community Development

EA European Accreditation Cooperation PDI Previously disadvantaged individuals

EMS Environmental Management System PFMA Public Finance Management Act

GFSI Global Food Safety Initiative QMS Quality Management System

GCP Good Clinical Practice SABS South African Bureau of Standards

GCPV Good Clinical Practice Veterinary SADC Southern African Development Community

GLP Good Laboratory Practice SADCA Southern African Development Community

IAF International Accreditation Forum Cooperation in Accreditation

ILAC International Laboratory Accreditation SADCAS Southern African Development Community

Cooperation Cooperation in Accreditation Services

IPAP Industrial Policy Action Plan SANAS South African National Accreditation System

ISO International Standards Organisation SANS South African National Standard

MAD Mutual Acceptance of Data TBT Technical Barriers to Trade

MLRA Multilateral Recognition Arrangement the dti The Department of Trade and Industry

MAURITAS Mauritius Accreditation Service WADA World Anti doping Agency

ContentContent

• Overview of SANAS• Strategic Overview• Service Offerings• Finances

Historical OverviewHistorical Overview

Role & Mandate of SANASRole & Mandate of SANAS

SANAS do & don’t doSANAS do & don’t do

Don’t Do

We do not develop or draft standards We support SANS We verify compliance to relevant national and international standards

We do not regulate Support regulators

We do not legislate We provide input to legislation when required

We do not prosecute We provide support to prosecutors

We do not provide conformity assessment services e.g. testing, inspection certification

We accredit conformity assessment bodies

Collaboration / PartnershipsCollaboration / Partnerships

Impact of AccreditationImpact of Accreditation• Ensure compliance to international standards• Underpin the acceptance of South African produced goods and

services • Negate technical barriers to trade (TBTs)• Crucial for “locking out” bad quality and unsafe imports and

“locking in” export markets

Facilitate Trade (Fair trade, International Trade)

• Use as a prerequisite by some regulators to approve private entities to perform work within the regulatory domain e.g. Department of Labour- Inspection, National Regulator for Compulsory Specifications (NRCS)- Trade Metrology

Support Regulations

• Reliable medical (diagnostic and treatment) and testing• Major Hazardous inspection (Inform emergency services and town

planning)• OHS measurements: For example noise exposure levels, light,

testing & inspection etc.• Protects against inferior imports (dumping)

Improve Quality of Life (Health, Safety, Environment; Law

enforcement, etc.)

• New energy sources, biofuels, liquefied natural gas, etc. • Increased reliable energy efficiency and green house gas emission

measurements, usage and claims (accurate consumption measures etc.)

• Contribute to safe water & food testing

Helps to meet social needs

Accreditation Stats – March 2013Accreditation Stats – March 2013

SANAS’ Service OfferingsSANAS’ Service OfferingsNO SUBPROGRAMME CONTRIBUTION TO ECONOMY AND/OR HEALTH AND SAFETY

1.

Calibration laboratories and proficiency testing schemes

Calibration laboratories provide legal metrological traceability in South Africa as stipulated in the Measurements Units and Measurement Standards Act (Act No. 18 of 2006). The laboratories therefore form an integral part of the metrological chain whenever physical measurements are performed, be these for trade, safety, scientific purposes, law enforcement or to ensure that South African manufacturers remain globally competitive. The calibration programme has an impact on the lives of ordinary South Africans, from ensuring that the weight of the sugar, maize meal and flour that is purchased is correct, to ensuring the accuracy of the equipment used for law enforcement, such as evidential breath analysers and speed measuring devices, and ensuring the accuracy and traceability of measurements required within the IPAP priority sectors. Proficiency testing is essential for the demonstration of the competency of a laboratory.

2. Testing laboratories

Testing laboratories play an important role in economies by providing objective evidence that a product or service offering conforms to certain customer requirements or specifications. SANAS-accredited laboratories in the food safety sector play an important role in monitoring the quality of food for import and export purposes, as well as for the health and safety of the public at large. The testing programme also provides an accreditation service in the IPAP priority Manufacturing sectors and other industry sectors, including environmental monitoring, food safety, infrastructure and construction, agriculture and minerals.

3. Medical laboratories

Creditability of medical pathology laboratories is paramount to the health and safety of the patients who rely on the testing services provided by these laboratories. Laboratory tests are an integral part of the workup of any patient, and constitutes up to 80% of a physician’s diagnosis and treatment choice. It is therefore important that the results are reliable, as medical doctors base their diagnosis on such results.

SANAS’ Service OfferingsSANAS’ Service Offerings

4A.GLP-compliant facilities

SANAS is the official OECD GLP monitoring authority. The main duty of the GLP monitoring authority is to monitor compliance with GLP Principles by conducting laboratory inspections and study audits. The OECD principles of GLP were primarily developed to promote the quality and validity of test data used to determine the safety of chemicals and chemical products.

4B.Forensic laboratories

Forensic laboratories are crucial to our criminal justice system as they provide very useful information that aid in the investigation and prosecution of crime through the scientific examination of physical evidence.

4C.

Veterinary laboratories and Good Clinical Practice (GCP)-compliant facilities

South Africa is no exception when it comes to the problems faced by the livestock industry worldwide. It is therefore important for the country to have a strong and competent veterinary laboratory industry to help with the diagnosis of diseases, especially emerging diseases such as Bovine spongiform encephalopathy (BSE – mad cow disease) and to test the safety of meat and other animal products.

4D. Blood transfusion

The primary goal of a blood transfusion facility is the transfusion of safe units of blood. Accreditation plays a vital role in ensuring that the personnel involved in all the activities (such as donor registration, blood collection, testing, processing and storage) of a blood transfusion service are competent and that national and/or international standards are being adhered to.

4E. Pharmaceutical

The South African pharmaceutical industry is regarded as the largest in Africa, constituting about 33% of all the pharmaceutical sales in Africa. The pharmaceutical or medicine industry is regarded as one of the best areas for business investment. Furthermore, it plays a vital role in fighting numerous diseases that are ravaging our country, such as TB, HIV and AIDS.

5. Inspection bodies

Inspection mainly operates within the regulatory domain where regulators and citizens need to be confident that inspection bodies, especially those inspecting health and safety issues in accordance with the Occupational Health and Safety (OHS) Act, are competent to do so. This also applies to bodies that are required to ensure the protection of consumers, such as the National Regulator for Compulsory Specification (NRCS) and those required under the IPAP, for example, nuclear inspection and measurement and verification agencies.

6.Verification laboratories

Verification laboratories fall under the domain of legal (trade) metrology, whose sole purpose is to protect consumers from unfair trade practices. These laboratories perform verifications on volume, mass and length measuring instruments in accordance with the requirements of the Trade Metrology Act (Act No. 77 of 1973) and other related technical regulations to ensure reliable results.

7. Certification bodies

Certification is the activity of conformity assessment where the focus is on a system that forms the basic requirements to ensure that an organisation has the necessary self-regulating procedures and controls on factors that affect a product so that it is possible to provide the customer with confidence that the product falls within the specified requirements. Accredited certification bodies certify other organisations with regard to compliance to management systems with recognised standards, such as quality management system, environmental management system. food safety management system requirements, responsible tourism and greenhouse gas validation and verification. This programme, together with the Inspection Body Programme, is the key accreditation implementer for the attainment of the IPAP projects assigned to SANAS.

8.

Broad-based Black Economic Empowerment (B-BBEE) verification agencies

In 2007, SANAS initiated the B-BBEE Verification Accreditation Programme, which supports government’s national objective to allow for a broader participation of previously disadvantaged people in the mainstream economy.

SANAS’ Service OfferingsSANAS’ Service Offerings

Accreditation Stats – March 2013Accreditation Stats – March 2013Countries @ 31 March 2013

Angola 1

Botswana 9

Ethiopia 3

Ghana 2

Kenya 14

Namibia 10

Nigeria 1

Swaziland 2

Tanzania 7

Uganda 7

Zambia 1

Zimbabwe 12

South Africa 1350SANAS Accredited facilities; SA = 95 % and the remaining 5% is shared by 12 African countries

SANAS’ Structure SANAS’ Structure 57 Full time staff - 72 by 2013180 Contracted Assessors (As need basis)

STRATEGIC OVERVIEWSTRATEGIC OVERVIEW

VISION

To pioneer and lead the future of accreditation in Africa and deliver services with a spirit of excellence.

MISSION

To create an impartial and transparent mechanism for organisations to independently demonstrate their com petence and facilitate the beneficial exchange of goods, services

and knowledge, and provide a service that is recognised as equitable to best international practice while reflecting the demographics of South Africa in all that we do.

VALUES

Integrity: To be consistent in our actions, principles and outcomes and to act with honesty without compromising the truth;

Excellence: Giving the best and world class service;

Partnership: Collaborating within and outside SANAS to give the best and to advance South Africa’s interest;

Pioneering: Offer creative new ways in accreditation which have the potential to change Africa.

PROGRAMMES

AdministrationAdministration AccreditationAccreditation GLP MonitoringGLP Monitoring Strategy & Development Strategy & Development Oversight, legal

support and Compliance

Assessment Engagements;

Inspection Engagements

New accreditation fields developments and

training

Increase Quality and Productivity

Improve External Relationships and Processes

Contribute to Government’s Strategic Objectives Processes

Key Intervention Areas & Results

Reduce vacancy positions to 10%;

Increase the registration of PDI assessors by 10 (total 76)

Develop and roll out an accreditation programme for:

The IPAP assigned: Energy

Management Systems; The DoL assigned: Risk Based

Inspection areas (1) BUSA assigned: Verification of

Green House; Road Transport Management

Systems; Expand number of accredited

Laboratories, Certification and Inspection Bodies (1438)

Provide Input to the international accreditation requirements

Provide AFRAC Secretariat;

Provide SADCA Secretariat

THE DTI’S PRIORITIES

Effective & Efficient service delivery;

Promote Industrial Development;

Build mutual beneficial regional and global relations to advance RSA trade

OVERVIEW OF SANAS’ ANNUAL PERFORMANCE PLAN & BUSINESS PLAN 2013/14 – 2015/16OVERVIEW OF SANAS’ ANNUAL PERFORMANCE PLAN & BUSINESS PLAN 2013/14 – 2015/16

Situational AnalysisSituational Analysis

• Background• Industrial Sector Support• South Africa’s Trade Facilitation• Protection of Health, Safety and the

Environment• Organisational Development

• Office Space• Skills availability

ConstraintsConstraints

Programme Alignment to the dti’s Priorities Programme Alignment to the dti’s Priorities

Cont: Programme Alignment to the dti’s Priorities Cont: Programme Alignment to the dti’s Priorities

IPAP Assigned ProjectsIPAP Assigned Projects

Business Plan 2013/14: Performance Plan Matrix Business Plan 2013/14: Performance Plan Matrix

OUTCOMES OUTPUTSPERFORMANCE INDICATORS/

MEASURES

Quarterly milestones

BASELINE2012/13

Annual Target

for 2013/14

Q1 Q2 Q3 Q4

Strategic objective 1: To Improve SANAS’s operational efficiency to deliver services with a spirit of excellence

Efficient service delivery

Improve the vacancy rate

Reduce the percentage of vacant positions

15 %

10%

15% 14% 13% 10%

Diversified assessor pool

Increase the registration of previously disadvantaged assessors

Number of previously disadvantaged assessors registered with SANAS in the assessors’ pool

68 76 69 71 73 76


Strategic objective 2: To contribute to industrial development and the protection of health, safety and the environment

Established accreditation systems for new programmes

Develop and roll out an accreditation system for the accreditation of IPAP2 assigned areas

IPAP accreditation programmes for:-Energy Management Systems

IPAP accreditation programme for measurement and verification of Energy Efficiency

IPAP accreditation programme for Energy Management Systems

Draft and approve Feasibility studies for Energy Management Systems Draft terms of reference and establish working group for the Management Systems

Develop document for the SANAS Technical Requirements for Energy Management Systems

Energy Efficiency Management Assessors sourcedAssessors trained

Conduct the Energy Efficiency Management awareness workshop for potential clients Handover of completed accreditation programme for Energy Management Systems

- Wind turbines - Organic

Agricultural Production and Processing

Feasibility studies for Wind turbines and Organic Agricultural Production and Processing drafted

Feasibility studies for Wind turbines and Organic Agricultural Production and Processing approved


MEASURES


BASELINE2012/13

Annual Target for 2013/14

Q1 Q2 Q3 Q4



Develop and roll out an accreditation system for the accreditation of Department of Labour assigned areas

Department of Labour- Accreditation programmes for Risk Inspection

Department of Labour

accreditation programme

for occupational

hygiene

Department of Labour-

Accreditation programmes

for Risk Inspection 1

Assessors sourced

Assessors trained

Conducted an

awareness workshop

for potential clients

Handover of completed

accreditation programmes

for Risk Inspection to the stream


MEASURES


BASELINE2012/13


Q1 Q2 Q3 Q4


Develop and roll out an accreditation system for the verification of greenhouse gases as requested by BUSA

Accreditation programmes for GHG emissions

0

Accreditation programmes

for GHG emissions

Handover of

completed GHG

validation and

verification accreditati

on programm

e to the relevant stream

0 0



Develop and roll out an accreditation system for road transport management systems

Accreditation system for road transport management systems

Accreditation system for

road transport

management systems

Feasibility studies drafted

and approved

Draft

terms of reference

theWorking

group (WG) and

WG establishe

d

Draft SANAS Technical

Requirements document developed

Finalise the

SANAS Technical

Requirements document developed

Expand the number of accredited organisations in the fields of testing, inspection, calibration, certification bodies and other conformity assessment services

Number of accredited organisations

1408 1 438 1415 1422 1430 1438


MEASURES


BASELINE2012/13


Q1 Q2 Q3 Q4

Business Plan 2013/14: Performance Plan Matrix Business Plan 2013/14: Performance Plan Matrix Strategic objective 3: To promote the acceptance of SANAS-accredited results among international partners to advance South Africa’s

trade and economic objectives Influencing international accreditation requirements to facilitate a level playing field for acceptance of South African goods and services

Provide input into the international accreditation requirements of the ILAC and IAF

Percentage input to the international accreditation requirements of the ILAC and IAF received quarterly from ILAC and IAF

90% 95% 95% 95% 95%

Strategic objective 4: To support regional integration and relations to advance South Africa’s trade, industrial policy and economic development objectives

Accreditation support to lock out poor quality goods and services

Provide an Intra-AFRAC Secretariat

Number of meetings where secretarial support is provided

3 meetings

3 meetings

AFRAC General Assembly AFRAC MRA Committee meeting AFRAC EXCO meeting

Provide a Southern African Development Community Cooperation in Accreditation (SADCA) Secretariat and regional coordination function

Number of meetings where secretarial support is provided

3 meetings

3 meetings

SADCA EXCO meeting

SADCA EXCO meeting SADCA General Assembly

Strategic objective Activity No. Risk description Actions to improve management of the risk

1

To improve SANAS’s operational efficiency to deliver services with a spirit of excellence

Staff retention 1 Failure to retain or attract critical skills

- Develop and implement a Management Development Strategy

- Expand the assessor pool

Developing and implementing an accreditation process IT system

2

Inefficiencies due to manual systems resulting in long turnaround times

- Automate the accreditation processes

Non-availability of assessors 3

Assessors who have confirmed for scheduled assessments cancel a few days before the assessment

Expand the assessor pool to allow for more flexibility by:- advertising for assessors- approaching employers of potential assessors to have an agreement

Risk Register & Mitigation ActionsRisk Register & Mitigation Actions

2

To contribute to industrial development and the protection of health, safety and the environment

Establishing new programmes 4

Lack of stakeholders/experts buy in to support the process

- Direct interaction sessions with regulators

- Involvement in stakeholder forums and drafting of regulations


- Timing of regulators to establish required legislation

- Unawareness of regulations by SANAS

- Subscribe and track publication of new regulations

- Senior management to pursue regulations sent for comment


Perceived costs versus the benefits of accreditation

Create a support mechanism to minimise accreditation costs for new applicants by:- holding an annual induction for new facilities- creating a toolkit to assist small, medium and micro enterprises (SMMEs) with accreditation process


Expectations gap between industry regulators with regard to the delivery of accreditation programmes

- Develop and distribute relevant marketing material

- Conduct workshops

Establishing new programmes 8 Limited skills (assessors)

for new programmes

- Ensure stakeholder participation in the work of SANAS

- Provide stakeholders with regular progress updates

- Develop guidance documentation where applicable




3

To promote the acceptance of SANAS-accredited results among global partners to advance South Africa's trade and economic development objectives

ILAC, IAF, SADC, AFRAC, Eastern African Community (EAC), regulators, industry

9 Failure to meet international requirements - Ensure international participation

Marketing, road shows, workshops, website, etc.

10

Lack of understanding of the Accreditation Act, SANAS's mandate by other government departments, industry and the public (including staff and assessors)

- Develop and distribute relevant marketing material

- Conduct workshops

4

To support regional integration and relations to advance South Africa’s trade, industrial policy and economic development objectives

Accreditation support to lock out poor quality goods and services

11 Increase in reliance on SANAS to support SADCAS - Identify and train regional resources

12 Insufficient funds to maintain regional projects - Acquire donor funding


Financial PlanFinancial Plan

1. PROJECTION OF REVENUE & EXPENDITURE; 2. CASH FLOW PROJECTIONS3. FRAUD PREVENTION4. MATERIALITY & SIGNIFICANCE FRAMEWORK

3 Year Projected Revenue3 Year Projected Revenue2013/14 2014/15 2015/16

SUMMARY OF INCOME

Accreditation provision 35 168 823 36 940 269 38 745 339 Knowledge transfer (research and development) 5 949 355 6 125 612 6 407 390 Transfer from the dti 32 615 000 34 560 000 36 151 488 Utilisation of the approved reserve: 1 200 000 - - Interest 1 001 250 877 198 909 949 Sundry income 254 700 267 180 299 608 TOTAL 76 189 128 78 770 260 82 513 774 - Capital assets 10 592 000 50 350 000 300 000

3 Year Projected Expenditure3 Year Projected Expenditure SUMMARY OF EXPENDITURE 2013 2014 2015

1. Administration 29 777 748 31 206 433 33 163 356

2. Accreditation provision 33 154 580 34 784 059 36 524 179

3. Marketing and communication 2 822 800 2 938 317 2 881 958

4. Regional development 718 150 737 866 897 480

5. International trade facilitation 2 261 178 2 134 487 2 344 250

6. Research and development 7 454 672 6 969 097 6 702 551

TOTAL 76 189 128 78 770 260 82 513 774

SURPLUS/(DEFICIT) - - -

Cash Flow ProjectionCash Flow ProjectionBUDGET BUDGET BUDGET

2013/14 2014/15 2015/16 Cash flows from operating activities Cash receipts 69 039 773 72 644 648 76 106 384 Funds received from the dti 32 615 000 34 560 000 36 151 488 Fee income 35 168 823 36 940 269 38 745 339 Investment income 1 001 250 877 198 909 949 Other receipts 254 700 267 180 299 608 Payments (67 473 282) (71 549 021) (74 640 317) Employee costs (34 761 426) (36 463 733) (38 720 621) Suppliers (32 462 830) (34 824 061) (35 643 697) Finance costs (249 025) (261 227) (276 000) Net cash flows from operating activities 1 566 491 1 095 626 1 466 067

Cash flows from investing activities Purchase of property, plant and equipment (20 592 000) (50 350 000) (300 000) Intangible assets acquired - - - Net cash flows from investing activities (20 592 000) (50 350 000) (300 000)

Cash flows from financing activities Mortgage bond (Borrowing) 31 000 000 (3 000 000) Finance lease payments (131 392) (122 397) (114 019) Net cash flows from financing activities (131 392) 30 877 603 (3 114 019)

Net increase/(decrease) in cash and cash equivalents

(19 156 900) (18 376 771) (1 947 952)

Cash and cash equivalents at the beginning of the year

53 070 200 33 913 300 15 536 529

Cash and cash equivalents at the end of the year 33 913 300 15 536 529 13 588 577

Performance MeasurePerformance Measure

• Evaluation ToolsEvaluation Tools– Balance Score Card– Independent Internal Auditors: ORCA– Independent annual Customer Satisfaction Survey (University

of Pretoria)

– International Peer Evaluations (ILAC, IAF……SADCA/AFRAC)– Own Internal Audits

• ReportingReporting– Audit Committee & Board of Directors– the dti Quarterly reports– Annual report

portfolio committee on trade and industry 17 april 2013

Documents

business plan

conformity assessment

annual performance plan

economic cooperation

international standardswe

draft standardswe support

inspection certificationwe

dont dodontdowe