6/24/2018 PRESENTATION OF THE NDA ANNUAL REPORT (2016/2017) TO THE PORTFOLIO COMMITTEE ON SOCIAL DEVELOPMENT 04 OCTOBER 2017

PRESENTATION OUTLINE Purpose of the presentation General Information about NDA Programme Performance Information Report on Governance Human Resource Performance Report Audited Financial Statements Challenges and Recommendations

PURPOSE To present the 2016/17 Annual Report comprised of the following sections: Performance Information Human Resource Report Governance Report Audited Annual Financial Statements To detail the organisational performance challenges experienced by the NDA To present the remedial measures to address the performance challenges

GENERAL INFORMATION

LEGISLATIVE MANDATE Primary Mandate Secondary Mandate To contribute towards the eradication of poverty and its causes by granting funds to civil society organisations for the purpose of: To promote consultation, dialogue and sharing of development experience between the CSOs and relevance organs of state through: Carrying out programmes and projects aimed at meeting development needs of the poor Strengthening the institutional capacity of other civil society organisations involved in direct service provision to the poor communities Debating development policy Undertaking research and publication aimed at proving basis for development policy Acting as conduit for funding from Government, foreign government and other national and international donors for development work carried-out by CSOs

ORGANISATIONAL VALUES STRATEGIC OVERVIEW 6/24/2018 Vision: A society free from poverty Mission: Facilitate sustainable development by strengthening CSOs involved in poverty eradication through enhanced capacity building with grant funding and research Integrity Dignity Empowerment Accountability Transparency Excellence Partnering ORGANISATIONAL VALUES

CSO DEVELOPMENT FRAMEWORK

ORGANISATIONAL STRUCTURE 6/24/2018 ORGANISATIONAL STRUCTURE Minister of Social Development NDA Board Chief Executive Officer Development Management and Research Research (and Policy) Development (Product Development) MERL Office of the COO Grant Funding and Resource Mobilisation Operations Management Office of the CFO Finance Supply Chain Corporate Services Human Resources Communications and Marketing ICT Support Services Performance Planning and Corporate Reporting Company Secretary Legal and Risk Services Stakeholder Management Internal Audit The structure was amended due to transition. The NDA is in the process of finalising it

PROGRAMME PERFORMANCE

PROGRAMME 1: GOVERNANCE AND ADMINISTRATION Strategic Objective: To develop and strengthen internal systems, processes and human capability to deliver efficiently and effectively on the NDA mandate Performance indicator Planned target 2016/17 Actual achievement 2016/17 Deviation from planned target Reasons for Deviation 1. Number of Executive (EXCO) meetings held 12 Target met 2. Number of partnership agreements concluded and signed 19 22 3 Over-achievement was due to more partners coming on board 3. Timeous submission of strategic plan & Annual Performance Plan to Executive Authority Submit within prescribed timeframes Submitted within prescribed timeframes 4. Number of hits reached trough NDA website and social media platforms 80 000 91 814 11 814 Adverts for vacant positions attracted more hits than anticipated 5. Percentage of staff audited for skills development 100%

PROGRAMME 1: GOVERNANCE AND ADMINISTRATION… 6/24/2018 Strategic Objective: To develop and strengthen internal systems, processes and human capability to deliver efficiently and effectively on the NDA mandate Performance indicator Planned target 2016/17 Actual achievement 2016/17 Deviation from planned target Reasons for Deviation 6. Percentage of targeted employees attending identified skills development programmes 60% Target met 7. Percentage reduction in regulatory audit findings 80% 0% Increase in non-compliance with laws 8. Completed and functional Integrated Information system Approved ICT strategy plan Service level agreement and project plan 100% Delays in appointment of service provider to develop strategy 9. Number of district offices established and functional 9 10 1 0% achievement on target to reduce 80% reduction in regulatory audit findings was due to very low moral due to transition and vacancies. Also refer to slide 19

PROGRAMME 2: CSO MOBILISATION Strategic Objective: To conduct CSO engagements, assessments and needs analysis in identified priority wards. Performance indicator Planned target 2016/17 Actual achievement 2016/17 Deviation from planned target Reasons for Deviation 1. Number of social engagements with CSOs on community development 2 030 3 120 1 090 Target exceeded due to participation in Mikondzo programme 2. Number of CSO structures formalised in priority wards 630 631 1 Target met 3. Number of CSOs assessed in priority wards to determine appropriate capacity-building interventions 4 357 2 327 4. Number of CSOs assisted to register with appropriate registration authority in priority wards 713 83 Target exceeded due to partnership with registration authorities 5. Number of CSOs assessed and referred to other agencies for technical and financial support in priority wards 406 1 403 997 Target exceed due to partnership with other agencies

PROGRAMME 3: CSO CAPACITY BUILDING Strategic Objective: To increase accessibility to capacity strengthening interventions to CSOs with the aim of improving the quality of services. Performance indicator Planned target 2016/17 Actual achievement 2016/17 Deviation from planned target Reasons for Deviation 1. Number of CSOs trained and mentored to comply with the Nonprofit Organisations Act (1997) 3 000 3 065 65 Improved partnerships with the Provincial Departments of Social Development 2. Number of CSOs capacitated in CSO management 2 000 2 880 880 Improvement in collaborative partnerships 3. Number of NPOs trained in community development practice 450 706 256 4. Number of NDA-funded projects exited into sustainable programmes 140 168 28 The districts improved the reporting and monitoring turnaround

PROGRAMME 4: RESEARCH AND KNOWLEDGE MANAGEMENT Strategic Objective: To conduct, collate and disseminate research and evaluations that inform national development agenda Performance indicator Planned target 2016/17 Actual achievement 2016/17 Deviation from planned target Reasons for Deviation 1. Number of research reports, evaluation reports and policy briefs produced 16 reports produced Target met 2. Number of best-practice publications produced 6 publications 10 publications 4 Demand for additional information 3. Number of dissemination sessions for research reports, evaluation reports, policy briefs and best-practice publications conducted 6 Sessions 7 Sessions 1 Session Partnerships with STATS SA on SDG domestication dissemination sessions 4. Number of people who attended research reports, evaluation reports, policy briefs and best practice dissemination sessions 240 People 465 People 225 People Partnerships with STATS SA on SDG domestication and NDA book launch 5. Revised NDA monitoring and evaluation framework and tools approved Approved M&E framework and tools

REPORT ON GOVERNANCE

NDA BOARD AND COMMITTEES The NDA Board consists of 12 members and it operated through the following committees for the 2016/17 financial year: Management Committee Audit and Risk Committee Human Resource and Remuneration Committee Projects, Research and Development Committee Stakeholder and Resource Mobilisation Committee The Risk Management strategy was revised and approved by the Board The Internal Audit Unit compiled an annual coverage plan for management of prioritised risks

BOARD EVALUATION OF CONTROLS The NDA Board assisted by the Audit and Risk Committee have reviewed: The effectiveness of the internal control systems; The operational risks covered in the scope of internal and external audit; The adequacy, reliability and accuracy of financial information; Any accounting and auditing concerns identified through audits; and Compliance with legal, accounting and regulatory frameworks The Board has also evaluated the Annual Report and discussed with the Auditor General material aspects of the report. 1

HUMAN RESOURCE REPORT

HUMAN RESOURCE PROFILE OF THE NDA The NDA had 180 employees for the financial year 2016/17 Africans are the pre-dominant racial group, with Females being in the majority at 58,9% The NDA has three (3) employees living with a disability which translates to 1,8% of the staff complement The vacancy rate is 22%, whilst, the turnover rate of the NDA is at 6,7% following the departure of 12 employees Four (4) employees attracted disciplinary action due to non-compliance with NDA policies and procedures 1,3% of the personnel budget has been spent on training and development, whilst, 3,3% has been spent on performance rewards

PERSONNEL COST PER PROGRAMME Total Expenditure for the entity (R’000) Personnel Expenditure (R’000) Personnel exp. as a % of total exp. No. of employees Average personnel cost per employee (R’000) Programme 1: Governance & Administration 102 980 31 291 14% 58 539 Programme 2: CSO Mobilisation 72 153 37 233 17% 99 376 Programme 3: CSO Capacity Building 40 741 8 872 4% 16 554 Programme 4: Research and Knowledge Management 4 888 3 748 2% 7 536   Total 220 762 81 144 37% 180 450

AUDITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2017

STATEMENT OF FINANCIAL PERFORMANCE FOR YEAR ENDED 31 MARCH 2017 PROGRAMME NAME AUDITED ACTUALS APPROVED BUDGET % SPENDING REVENUE R 237 317 932 R 230 069 114 103% TOTAL EXPENDITURE R 220 762 059 96% PROGRAMME 1: ADMINISTRATION R 102 979 842 R 112 973 796 91,1% PROGRAMME 2 : CSO MOBILISATION R 72 152 919 R 70 409 309 102,5% PROGRAMME 3: CSO CAPACITY BUILDING R 40 741 309 R 41 335 733 98,6% RESEARCH AND DEVELOPMENT R 4 887 988 R 5 330 276 92% SURPLUS R 16 555 872 - 4%

NOTES TO STATEMENT OF FINANCIAL PERFORMANCE INTRODUCTION The NDA continues to operate under stringent financial constraints due to financial allocation increasing at 5% year on year while CPI averaged 6.5%. The resources are decreasing in real term. Key organisational expenses such as rentals of offices and employment costs increased by 8% and 7% respectively in the previous financial year. The entity is reporting a surplus of R 16,5million in 2017

NOTES TO STATEMENT OF FINANCIAL PERFORMANCE REVENUE Revenue is made up of three key sources as indicated in the table below. Revenue decreased by 7% year on year from R254 million in 2016 to R237 million in 2017 The main contributor to the reduction in revenue of R5 million is attributable to reduction in conditional grants received from other government departments. 2017 2016 % CHANGE Allocation R194 153 000 R184 381 000 5,2% Conditional grants R 35 392 934 R 60 717 962 (41%) Other Income R 7 771 998 R 9 893 611 (217,1% R 237 317 932 R254 992 573 (7,1%)

NOTES TO STATEMENT OF FINANCIAL PERFORMANCE TOTAL EXPENDITURE A total of R 220,8 million was spent against allocated budget of R 230million representing 96% of the allocated annual budget. MANDATE EXPENSES ( R 117,8 million spent vs R 117,1 million budget) Mandate expenditure of R117 ,8 million represents 53% of total actual expenditure to the value of R 221million was spent as follows : - Programme 2: R 72 ,2 million spent vs R 70,4million budget ( 102%) - Programme 3: R 40,7 million spent vs R41,3 million budget ( 98,6%) - Programme 4 : R 4,9 million spent vs R 5,3 million budget ( 92%) ADMINISTRATION EXPENSES R 102,9 million was spent on administration against budget of R112 million representing 91,1% of annual allocation. The 8,9% variance was partly due to delays in establishment of district offices and finalisation of the ICT strategy.

STATEMENT OF FINANCIAL POSITION AS AT 31 MARCH 2017

NOTES TO THE STATEMENT OF FINANCIAL POSITION (BALANCE SHEET) KEY BALANCE SHEET PERFOMANCE Current Assets The entity has total current assets of R102 million in 2017, with cash balances to the value of R 101 million making up 99% of total current assets Cash balances are committed as follows: Amounts Third party funds R 14 833 981 Other current liabilities R 21 801 620 Project commitments R 22 790 992 Committed expenses purchase orders R 17 443 987 Unencumbered cash R 24 254 611 R101 175 191

NOTES TO THE STATEMENT OF FINANCIAL POSITION (BALANCE SHEET) KEY BALANCE SHEET PERFOMANCE Current Assets liabilities Total liabilities are made up as follows: Amount % Unutilized third party funds R14 833 981 38% Payables (Funds due to creditors) R7 511 527 20% Employee benefits (leave provision & 13th cheque) R 9 888 631 27% Provision for project payment R 4 401 462 15% R 36 635 601 100%

CHALLENGES AND RECOMMENDATIONS 1

CHALLENGES EXPERIENCED IN 2016/17 6/24/2018 The repositioning and the restructuring of the organisation created programme implementation challenges The expansion to the districts meant new personnel at district level had to be trained on programme implementation and this took longer than anticipated The CSO Development framework was finalised towards the end of the 2016/17 financial year which had a major impact on the finalization of the tools used as Portfolio of Evidence (POE) for programme reporting Last bullet relates to the material finding of the AG. The AG was not informed on time of the tool and the work that was already done

REMEDIAL MEASURES We have stabilised the programme implementation in the districts We have developed an Audit Turnaround Strategy to address the performance information shortcomings We have finalised the development of the tools for reporting on performance information We have trained the Development Officers on the CSO development framework and its related tools

6/24/2018 Thank you THANK YOU