PRESENTATION TO SELECT COMMITTEE NATIONAL DEVELOPMENT AGENCY PRESENTATION TO SELECT COMMITTEE ON SOCIAL SERVICES Godfrey Mokate Chief Executive Officer National Development Agency 20 June 2006

STRUCTURE OF PRESENTATION BACKGROUND Formation Mandate

STRUCTURE OF PRESENTATION (continuation….) PERFORMANCE IMPACT Financial Allocations Impact on Poverty Grant Commitments Grant Disbursements Magnitude of Poverty

STRUCTURE OF PRESENTATION (continuation….) Development Needs of CBOs and NGOs Key Issues from 2005/6 Annual Report Organisational Challenges External Audit Issues Financial Highlights

STRUCTURE OF PRESENTATION LOOKING FORWARD – NDA STRATEGY 2006/11 Strategic Goals and Objectives Macro Indicators Business Model Balanced Scorecard

BACKGROUND

FORMATION The NDA was: Preceded by an interim agency, the TNDT, established in 1996. A product of social dialogue between state and CSOs.

Dialogue was necessitated by need to : Cultivate a collaborative as opposed to adversarial relationship between government and civil society organisations. Respond to diminishing development resources for NGOs and CBOs as a result of bilateral relationship with international donors. Establish institutional mechanism for policy dialogue. Mitigate the impact of CSO “braindrain” to government.

NDA Mandate 1 )The primary mandate of the NDA is to contribute towards the eradication of poverty and its causes by granting funds to civil society organisations for the purpose of : Carrying out projects or programmes aimed at meeting development needs of poor communities; and Strengthening the institutional capacity of other civil society organisations involved in direct service provision to poor communities.

2) The secondary objects of the NDA (continue……) To promote Consultation, dialogue and sharing of development experience between civil society organisations and relevant organs of state; and Debate on development policy; b) To undertake research and publication aimed at providing the basis for development policy.

Grant Trends / Allocations to the NDA 2001/2 2002/3 2003/4 2004/5 2005/6 2006/7 2007/8 R’m % Grant 92.7 96.7 4% 103.2 7% 109 6% 121.5 11% 128.7 135.2 5%

NDA Impact on Poverty Since March 2000, the NDA has committed R640m to projects in economic development, food security, community health and education. This has benefited 407 773 direct households. Indirectly benefited 2 031 375 poor people.

South African Government Grant Commitments:2004/5 Province Number of projects Approved Amount Committed per Province Eastern Cape 6 R 5 234 588 Free State 7 R 5 648 212 Gauteng 10 R 2 935 234 Limpopo 12 R 17 125 722 Kwa-Zulu Natal 4 R 3 198 383 Mpumalanga 16 R 17 074 197 North West R 3 869 647 Northern Cape R 5 003 940 Western Cape R 9 684 822 TOTAL R69 774 745

South African Government Grant Commitments: 2005/6 Province Number of Projects Approved Amount Committed per Province Limpopo 18 R13 488 614 Mpumalanga 11 R8 313 407 Eastern Cape 36 R12 136 666 Northen Cape 3 R2 481 554 Western Cape 8 R7 275 747 Kwa-Zulu Natal 15 R12 169 884 North West 2 R2 918 943 Free State R1 373 567 Gauteng 4 R8 742 621 TOTAL 90 R 68 901 003

R61.5m R 84 646 481.59 Projects Disbursements 2004/5 (1 April 2004 – 31 March 2005) 2005/6 (1 April 2005 – 31 May 2006) R61.5m R 84 646 481.59

The NDA definition of Poverty extends to the following variables: Income Employment Education Infrastructure Assets Access to social services

Level of poverty The current estimates of poverty by HSRC show that the proportion of people living in poverty in South Africa is as follows:- Approximately 57% of individuals in South Africa were living below the poverty income line in 2001, unchanged from 1996. This translate into 26m people being classified as poor.

Table 1. Poverty Distribution by Province No. of poor persons (million) %of population in poverty Poverty gap (R billion) Share of poverty gap Eastern Cape 4.6 72% 14.8 18.2 % Free State 1.8 68% 5.9 7.2 % Gauteng 3.7 42% 12.1 14.1% Kwa-Zulu Natal 5.7 61% 18.3 22.5% Limpopo 4.1 77% 11.5 Mpumalanga 57% 7.1 8.7% North West 1.9 52% 6.1 7.5% Northern Cape 0.5 1.5 1.8% Western Cape 1.4 35% 5.0% South Africa 25.7 81.3 100.0%

Development Needs of CBOs and NGOs Strengthening of leadership, management and technical capacity to improve service delivery. Platform for policy dialogue to influence government development policy Funding to implement programmes that eradicate poverty and bridge the gap between first and second economy.

Development Needs of CBOs and NGOs Information and knowledge sharing of “best practice” in development. Access to markets for income generating projects. Procurement opportunities from government. Support for community wide policy and advocacy initiatives.

Key Issues from Unauditted 2005/6 Annual Report Goals, Objectives and Indicators The 2011 Strategic Plan with clear indicators for impact assessment, monitoring and evaluation. Organisational stability established and maintained through effective management of NDA risks. Profiling of NDA raised and its credibility improved.

Continuation…………………………………… Projects management systems improved to clear existing payment backlogs. Support of NDA multi-year indicative programme by EC Delegation. Research to inform the development of poverty eradication strategy conducted and implemented.

Continuation…………………………………… Corporate governance improved and delegations established Resource mobilisation strategy and plan developed NDA systems improved.

Achievements Against Goals 2006 – 2011 Strategic Plan revised, completed and approved by the Minister of Social Development. Backlogs on labour and corporate governance cases addressed and resolved. Improved profile through strategic engagements with stakeholders and media. Projects Turn-Around time improved from six (6) to four (4) months

Continuation………… Negotiation with European Commission and National Treasury currently underway. Research agenda has been defined. Corporate governance has improved through clear policies, procedures and delegation of authority. Research mobilisation strategy has been prioritised for current financial year. Business Process Mapping has been concluded with a “to be” model being designed.

Achievements and Highlights 1 April 2005 – 31 March 2006 Appointment of a permanent CEO in June. Finalization of matters arising out of the forensic investigation. Grant funding commitment of R68.9m to income generating and food security projects. Participation in the National Program for Creation of Small Enterprises and Jobs in Second Economy – ASGISA. Launch of Request for Proposals (RFP) for CSO Capacity Building. Finalisation of strategic plan 2006/11

External Audit Issues Withdrawal of projects previously committed, Budget for 2005/2006 Forensic investigation, Key reconciliations and Payroll reconciliation

Challenges Organisational instability in terms of labour relations. Backlogs in projects payments. Dependency on single source of funding. Unclear business model. Corporate governance.

Challenges (continuation…) Level of funding allocation compared to level of demand. The NDA receives funding requests of approx. R750m per annum. Building organizational capability and competencies - human and institutional. Review the NDA Act to allow responsiveness with regard to promoting “social entrepreneurship” - support to family led enterprises.

Looking forward – NDA Strategy 2006/11

NDA’S STRATEGIC GOALS Organisational Transformation (internally focused) Partnering for Development (externally focused)   Resource Mobilisation for poverty eradication (externally focused) Community empowerment for sustainable development (externally focused) Communication of credible and relevant researched development information (both internally and externally focused)

Macro Indicators Macro indicators speak to the high-level, externally focused objectives that will be achieved through implementation of NDA’s strategic goals as defined in the Organisation Scorecard. The Macro indicators and associated strategic goals are as follows: 1)    Improved coordination of resource allocation for poverty eradication 2)    Improved economic opportunities for communities in NDA targeted localities      3)    Improved social empowerment in NDA targeted localities          4)    Improved capability of targeted CSOs in relation to service delivery  5)     Increased influence in development policy as it relates to poverty eradication

Questions and Comments Thank you for your attention