Department of Public Works Budget Vote and Strategic Plan: briefing

PUBLIC SERVICES SELECT COMMITTEE
1 June 2006
DEPARTMENT OF PUBLIC WORKS BUDGET VOTE AND STRATEGIC PLAN: BRIEFING

Chairperson: Mr R Tau (ANC)

Documents handed out:
Department of Public Works presentation: Part 1 & 2

SUMMARY
The Department of Public Works met with the Committee to present detail on the key programmes of the Department and the various directorates. Service delivery would be improved and state properties would be managed in a more effective manner. Policy initiatives were outlined and important aspects of the overall strategy explained.

Members asked various questions including on payment for consulting engineers, the Department’s contribution to the Expanded Public Works Programme, the need to improve the public tender process, enhanced implementation at the provincial and local level, the disposal of state immovable assets, the nature of skills training programmes, preparations for the 2010 World Cup and the need to improve intergovernmental relations.

MINUTES
Department of Public Works presentation
Ms L Bici (Deputy Director-General-Policy Development) provided detail on the Department’s core business areas and the Chief Directorates. The value plan was outlined that strove to improve service delivery, enhance capacity and promote asset management. The Department would support the Accelerated Shared Growth Initiative of South Africa through its various programmes. Detail was provided on the Department’s strategic initiatives and the Service Delivery Improvement programme. Policy initiatives were outlined including transformation of the property and construction industries and the asset disposal strategy. The Department’s contribution to the Expanded Public Works Programme (EPWP) was explained.

Discussion
Mr Adams asked whether consultant engineers received 18% of the total project cost in fees. He asked whether the R2 million for the maintenance of the parliamentary precinct facilities was included in the R73 million budget. Clarity was sought on a plan to expand the urban redevelopment project to other cities. R33 million for the contribution to EPWP appeared to be minimal. The Department had to communicate with municipalities and form partnerships to drive EPWP. He asked whether asset registers had been completed and sought clarity on the number of long-term leases in existence. The public tender process had to become more efficient and under-utilised assets should be disposed of. The Department’s contribution to emerging contractors was requested.

The Chairperson noted that the Department had to focus on provincial and local government in order to fulfil its constitutional mandate. The presentation should include specific information derived from the provinces such as the number of emerging contractor incubators and gender and youth programmes. A progress report on the implementation of the EPWP was required. Individual success stories with regard to skills enhancement should be recounted. He asked where existing incubators were situated. Clarity was sought on the process to dispose of state immovable assets. Skills training programmes had to have clear exit points based on the standard of training achieved to enable recipients to operate independently.

Ms H Matlanyane (ANC) commented on the poor quality of the Members’ official residences and asked whether maintenance could be improved. She asked for a breakdown of the disposal of property per province.

Ms Bici stated that the nature of the presentation would be improved in future with more pertinent detail provided. Key programmes would be highlighted. A database of emerging contractors had been established based on a list of criteria. Contractors worked on projects ranging in budget from R1 million to R30 million. Contractors would serve a period of three years on the database before operating independently. Contractor incubators were positioned throughout the country. Contractors involved in fronting would be removed from the database. The regeneration project had been initiated in Tshwane as the administrative capital of South Africa. Irregularities in the public tender process were being investigated. The Department’s Portfolio Analysis Unit investigated the use of state-owned properties and determined whether disposal should occur. Many buildings were in a dilapidated state and were surplus to government needs. Checks and balances were in place to oversee the process and prevent corruption. A public tender process advertised the sale of assets. Tenders went before the Department’s Tender Committee for evaluation and then to the Director-General for approval. The Minister granted the final approval.

Mr Z Ntsaluba (Chief Financial Officer) confirmed that consultants received 18% of the total project’s value as a fee. The R2 million for the maintenance of the Parliamentary precinct was included in the R73 million total budget. Intergovernmental relations between the Department and the provincial and local government sectors could be improved. The condition of housing for Members would be investigated.

Ms Bici declared that external consultants had to be employed as the placing of such skills in the Department would be too costly. The use of consultants also aligned the Department’s projects with industry best practice. The asset register captured key information including size of property, cost, current use etc. Illegal occupiers of state property would be identified and asked to vacate the premises. Information on long-term leases would be made available to Members. Currently, R1.4 billion was leased from the private sector. A study had concluded that a combination of leases and state owned property was the cost-effective approach to accommodation needs.

Mr M Lieuw-Kie-Song (EPWP) stated that the R33 million budgeted for EPWP was for technical support and not for implementation of projects. A project management unit within the Department communicated with provincial and local government on the EPWP. Technical support was provided to the provinces. Provincial steering committees were in place in all provinces. EPWP coordinators were in place in the major cities. Technical support to municipalities would be co-ordinated. Various projects were in place with provincial governments to drive the EPWP such as contractor-learnership programmes. The list of participating municipalities would be forwarded to the Committee.

Ms Bici stated that a disposal strategy for properties was in place to assist Black Economic Empowerment and skills development. The strategy had been submitted to Cabinet. Discussions were taking place with financial institutions to make funding available for Black landlords.

The Chairperson noted that a similar response had been made in 2004 but the Department continued to struggle to generate suitable levels of co-operation in the provinces to national initiatives. He asked what steps the Department could take to heighten support at the provincial and local level.

Mr Ntsaluba stated that a relative autonomy existed at the provincial level in terms of public works and infrastructure that complicated matters. However, co-operation did occur between the spheres of government. 

Ms Bici responded that the Department did exercise influence at the provincial level. The service delivery programme would be implemented to improve the Department’s impact at the local level. Liaison with provincial governments would be conducted to enhance co-operation and ensure implementation of legislation. 

The Chairperson reiterated that the Department had to adopt a hands-on approach in the provinces. He asked whether the Department assisted the Departments of Correctional Services and Water Affairs and Forestry in terms of infrastructure development. He asked about preparations for the 2010 World Cup.

Mr Ntsaluba stated that the Director-Generals of the various Departments had to account for expenditure of allocated amounts as the budget for the EPWP had been devolved. The building of dams was the sole responsibility of the Department of Water Affairs and Forestry. The Department assisted with the costing for the building of prisons for Correctional Services. The costs had increased since the budget had been finalised and a reduced number of prisons would now be constructed. Interaction with the Department of Sport and Recreation would occur with regard to the World Cup.

The meeting was adjourned.