Economic Development Department 3rd Quarterly Report Presentation to the Portfolio Committee on Economic Development 08 February 2012

Presentation 3rd Quarter performance Progress against ENE targets Economic Policy Development Economic Planning and Coordination Economic Development and Social Dialogue Progress against ENE targets Human Resources Financial performance Concluding remarks 2

Economic Policy Development (1) Mid-term report on Employment and Inclusive Growth submitted for inclusion in January 2012 Cabinet Lekgotla discussions: Review of progress in achieving targeted outcomes; Assessment of policy successes and shortfalls; and Prospects and actions to mitigate the risks. Survey on employment reporting for state departments and agencies conducted: System developed in collaboration with DPME and the ILO; Survey demonstrates the need to improve systems for assessing impact of government actions on employment. 3

Economic Policy Development (2) Policy Platforms Proposed multi-pronged Strategy on Youth Unemployment work shopped on 23 November 2011 Developed draft discussion document - Addressing Inequality. A workshop will be held in the 4th quarter. Asset ownership and inequality - workshop held with Friedrich Ebert Stiftung and Studies in Poverty and Inequality Institute. Infrastructure planning (PICC) engagement with McKinsey 4

Economic Planning and Coordination (1) New Growth Path - engagements with provincial and local government: KZN Regional and Local Economic Development; Limpopo Department of Economic Development, Environment and Tourism Strategic Planning; Deputy President’s Anti-Poverty Campaign visit to Blouberg Local Municipality in Limpopo province; Western Cape Department of Economic Development and Tourism; Free State Local Economic Development; Participates in DRDLR-led initiative focusing on prioritising high impact projects in 22 rural districts; Presidential Intervention in Diyatalawa and Makgolokoeng municipalities in Free State province; 5

Economic Planning and Coordination (2) Sector plans This function now resides with the Economic Policy and Development Branch – see slide p.4 referencing multipronged Youth Unemployment Strategy proposals. Spatial plans Employment Creation Fund approved funding for Rise Up Cooperative Bakery Holdings. Pilot in Matzikama-Dooringbaai municipality; Fisheries unit of DAFF approved aquaculture EPWP project for Doringbaai - MOU initiated; Spatial economic planning framework and guidelines are underdevelopment in consultation with CSIR; Various projects in the Eastern Cape and Western Cape. 6

Economic Planning and Coordination (3) Green Economy Strategy and Interventions Green Jobs report submitted through the IDC; Engagement with DOE on REIPP program; Engagement with NT, DRDLR, DPE, DOE on rollout of Solar Water Heaters; Engagement with Blue IQ to discuss establishment of provincial green economy unit focussing on local economic development and SMME development; and Workshop with COSATU and Cape Business Chamber. Prepared concept paper on harnessing partnerships to promote agricultural development for small and medium scale black farmers. 7

Economic Planning and Coordination (4) Special financing A total of R2 361 914 000 was disbursed during this quarter: IDC Distress fund: R184.4 million UIF Bond: R343.4 million Transfers to SAMAF: R22.5 million Transfers to IDC: R17 million IDC disbursements: R1.8 billion Leveraging state expenditure and procurement SABS technical specifications finalised and published for public comment. Engagements with DFIs and ERBs Governance – meeting to discuss quarterly reports; Small business financing merger – reported to PC on 1 February 2012. 8

Economic Development and Dialogue (1) Social dialogue and capacity building engagements: Training Layoff Scheme and Distress Funding - Implementation of Framework Agreement presentations in KZN, EC, NC and Limpopo; Meeting with Community Constituency to discuss joint working programme with stakeholders; and Turn-around strategy for Dimbaza Foundry - presentation in EC. Economic Development Agreements Local Procurement Accord signed on 31 October 2011; and Green Economy Accord signed on 17 November 2011. Organised labour capacity building 4 workshops held in KZN, EC, NC and Limpopo. 9

Economic Development and Dialogue (2) Engagements on productivity Workshop with ILO, Proudly South Africa, Organised Labour and Communities. Interventions to create or save jobs Meeting with Clothing Bargaining Council to discuss possible projects and interventions; and Interactions with Ceppwawu and COSATU and the employer to discuss interventions in light of proposed job cuts in the paper sector. Engagements with stakeholders Participation in panel discussion on job creation at Fedusa Congress. 10

Economic Development and Dialogue (3) Implementation of Framework Agreements and Social Pacts Presentation at ILO / Labour Jobs Pact workshop

ENE targets for 2011/12 (1 of 2) Indicator 3rd Q target 3rd Q actual Annual target Number of reports on the implementation of the NGP 1 4 Number of reports on interventions to reduce cost drivers - 2 Number of policy and analytical papers on economic policy challenges 3 12 Number of engagements with provincial and/or local government 10 Number of strategic engagements with development finance institutions and/or economic regulatory bodies Value of special financing facilitated for small businesses, targeted growth sectors and companies in distress R1.25bn R2.362bn R5bn 12

ENE targets for 2011/12 (2 of 2) Indicator 3rd Q target 3rd Q actual Annual target Number of sector plans produced or reviewed 2 8 Number of spatial plans produced or reviewed 3 4 12 Number of interventions in relation to promoting economic development through leveraging state expenditure and procurement Number of reports on the implementation of the green economy strategy - 1 Number of interventions to create or save jobs Number of policy platforms, social dialogue and capacity building engagements 10 Number of economic development agreements (sectoral, workplace and national) facilitated with social partners 13

# of Posts Filled -Permanent # of Posts Filled - Contracts Staff Complement (31/12/2011) Programme # of Funded Posts # of Posts Filled -Permanent # of Posts Filled - Contracts Total ADMINISTRATION 62 43 21 64 POLICY DEVELOPMENT 20 5 4 9 PLANNING & COORDINATION 33 10 19 SOCIAL DIALOGUE 14 8 TOTAL 129 61 39 100 % 62% 38%

Employment Equity Statistics (31/12/2011) Designation White Black Disability Sub-Total Total M F   SMS 5 3 13 8 18 11 29 MMS 2 1 22 15 23 38 Level 1-8 24 33 7 4 34 54 41 59 100 TOTAL 88 % 11% 88% 1% 41% 59%

PERSONS WITH DISABILITY = 1% PERMANENT 15 8 23 23% All Staff Male Female Total % PERMANENT 24 37 61 61% CONTRACTS 17 22 39 39% TOTAL 41 59 100 100% 41% 59% PERSONS WITH DISABILITY = 1% SMS Members Male Female Total % of total staff PERMANENT 15 8 23 23% CONTRACTS 3 6 6% TOTAL 18 11 29 29% % of SMS Members 62% 38%

Recruitment Strategy and plan in place to recruit relevant and skilled staff by end of the 2011/12 financial year; Report monthly progress to EA and DG Progress in 3rd Quarter 11 x Appointments (3 x permanent and 8 x contract) 7 x terminations (3 x contract expiry, 1 x transfer, 3 x resignations) 1 x Posts Advertised (Principal Personnel Officer) Interviews conducted to fill the following positions: Economist = 3 posts Senior Economist = 2 posts Policy Analyst = 8 posts Senior Administrative Officer = 1 post Accounting Clerk = 3 posts Director : IT = 1 post 17

Financial Performance Overview of Expenditure The information based on December 2011 IYM reports or section 40(4)of PFMA reports; Signed by the Accounting Officer and sent to National Treasury; Total adjusted budget of R 598.3 million for 2011/12 financial year; Expenditure in the first nine months of 2011/12 is R 449.9 million or 75% of the adjusted appropriation of R 598.3 million; Spending rate equal to the 75% norm on straight forward projections where annual total budget is expected to be spent equally through the year. 18

Financial Performance 19

Financial Performance Overview of Revenue Revenue collection in first nine months of 2011/12 is R 500.4 million or 205% of budgeted revenue of R 243 million; Main revenue generator is fines from penalties from Competition Commission and dividends from IDC; and Revenue projections exceeded due to Pioneer Food settlement 20

Financial Performance Commitments As at the end of December 2011 - R4.3 million. Earmarked Projects / Spending Totaling R36 million for the remainder of the 2011/12 financial year. Including: Support for a Credit Bureau for small business; Support for a shared service centre in support of small business; Business incubator for the social economy; Costs towards the Khula / samaf / IDC Small Business merger; A SMME index on regulatory constraints; A 30-day payment campaign; Support for a green village pilot project in partnership with the Department of Environmental Affairs; Wits Capacity Building Programme for Local Government; and Labour, Government and Civil Society Workshops. 21

Concluding Remarks 4th Quarter COP 17 Establishment of EDD Good work is being done and in the 4th quarter special attention to be paid to youth unemployment, the Green Economy, Inequality, Implementation of the Accords and special financing. COP 17 EDD successfully participated and through the EDD/IDC exhibition stand raised R750 000 for the roll-out of solar water heaters. Donating approximately 500 solar water heaters to the community of Groutville Establishment of EDD Progress is being made, but challenges remain in finding people with the correct level of skill to deliver the quality of work required to drive job creation EDD Website launched [www.economic.gov.za] 22

Siyabonga