4/5 March 2015 Briefing: Annual Performance Plan 2015-16 Portfolio Committee of the Department of Agriculture, Forestry and Fisheries (DAFF)

Reputation promise/mission The Auditor-General of South Africa has a constitutional mandate and, as the Supreme Audit Institution (SAI) of South Africa, exists to strengthen our country’s democracy by enabling oversight, accountability and governance in the public sector through auditing, thereby building public confidence.

Agenda 1. Audit of Predetermined Objectives Review of Annual Performance Plan 2015-16 Budget 2015-16

AUDIT OF PREDETERMINED OBJECTIVES

Audit of Predetermined Objectives OVERSIGHT: Parliament, provincial legislature or municipal council Identify desired impacts Assess and adjust Specify performance indicators resources Monitor and take Corrective action Policy development Strategic Planning INSTITUTION National department Provincial department Municipality Public entity Municipal entity Operational planning and budgeting End-year reporting Set targets and allocate resources Implementation and in-year reporting

Audit of Predetermined Objectives Legislative Requirements AGSA Constitution Chapter 9 Section 188 – must audit and report on accounts, financial statements and financial management of government institutions Public Audit Act (No. 25 of 2004) Section 20 – AGSA must prepare audit report containing opinion/ conclusion on: - Financial statements and financial position - Compliance and financial management - Predetermined objectives (performance) Departments Public Finance Management Act (No. 1 of 1999) Section 38(1)(a)(i) – has and maintains effective, efficient and transparent systems of financial and risk management and internal control. Section 40(3)(a) - annual performance report Treasury Regulations Chapter 5 - Strategic Planning Guidelines, Instruction Notes, Practice Notes, issued by National Treasury Public Service Regulations (PSR) Part III B: (Only applicable to departments) Regulations 1(a)-(f),(g) FMPPI Framework for managing programme performance information (issued by the National Treasury in May 2007) Chapter 5 & Framework for Strategic Plans and Annual Performance Plans par. 4&6

Audit of Predetermined Objectives AGSA Audit process Understand and test the design and implementation of the performance management systems, processes, and relevant controls 1. Understand Test the measurability, relevance, presentation & consistency of planned and reported performance information 2. Test Usefulness Conclude on the usefulness of the report on predetermined development priorities or objectives 3. Conclude Usefulness Test the reported performance information to relevant source documentation to verify the validity, accuracy & completeness of reported performance information 4. Test Reliability Conclude on the reliability of the reported performance for selected development priorities or objectives 5. Conclude Reliability

Audit of Predetermined Objectives Audit Outcomes of 2013/14 Compliance with regulatory requirements Existence Timeliness Usefulness Presentation Measurability Relevance Consistency Reliability Validity Accuracy Completeness Additional matter paragraphs included in the audit report: > Material adjustments were made to the annual performance report submitted for audit. No matters reported Reported in audit report

REVIEW OF ANNUAL PERFORMANCE PLAN 2015-16

Annual Performance Plan 2015-16 Usefulness 2015/16 APP Performance information must be presented using the National Treasury Annual reporting guidelines. Actual performance information in tables and narrative in annual report must be consistent. Reasons for major variances between planned and actual performance must be explained and should be supported by corroborating evidence. Requirement Presentation Conclusion Can only conclude once the Annual Performance Report is made available on 31 May 2015. Requirement Objectives, indicators and targets must be consistent between planning and reporting documents. Consistency Conclusion Can only conclude once the Annual Performance Report is made available on 31 May 2015. Indicators should be well-defined and verifiable. Targets should be specific, measurable and time-bound. Requirement Measurability Conclusion Findings identified on Programme 3 and Programme 5 amd Programme 6 summarised per programme on the next slide. The indicators relate logically and directly to an aspect of the institution's mandate, and the realisation of strategic goals and objectives Requirement Relevance Conclusion No material findings to be reported.

Annual Performance Plan 2015-16 Programme 3: Food Security and Agrarian Reform 13% of targets not measurable 13% of indicators not verifiable Strategic objective Indicator 2015/16 Target “SMART” criteria affected Lead and coordinate government food security initiatives. Number of hectares of under-utilised land in communal areas cultivated for production. 120 000 ha  Annexure E: “A 30% data sample will be collected from each province at the end of the planting season…” Measurable / Indicator not verifiable Annexure E state that information will only be verified on a 30% sample basis by the department. The total population will therefore not be measurable or verifiable.

Programme 5 (Continues) “SMART” criteria affected Annual Performance Plan 2015-16 Programme 5 (Continues) Forestry and Natural Resource Management Strategic objective Indicator 2015/16 Target “SMART” criteria affected Ensure the conservation, protection, rehabilitation and recovery of depleted and degraded natural resources. Number of plantations certified for Forest Stewardship Council. 1 Annexure E: Source: Service provider to evaluate data against agreed external standards. Specific and Measurable / Indicator not verifiable Annexure E does not specify the specific data that will be collected from the service provider.

Annual Performance Plan 2015-16 Programme 6: Fisheries : Marine Living Resource Fund 11% of targets not specific 33% of indicators not well defined Strategic objective Indicator 2015/16 Target “SMART” criteria affected Strategic goal 2: Enhanced production, employment and economic growth in the sector Objective 2.1: Ensure increased production and productivity in prioritised areas as well as value chains Number of Aquaculture catalyst projects identified and listed under Operation Phakisa supported 4 Operation Phakisa Projects for phase 1 supported Measurable / Indicator not well defined The indicator per the annual performance plan, read in conjunction with the target does not define the type of support that is required in order to achieve the objective.

“SMART” criteria affected Annual Performance Plan 2015-16 Programme 6: Fisheries : Marine Living Resource Fund (continues) Strategic objective Indicator 2015/16 Target “SMART” criteria affected Strategic goal 3: Enabling environment for food security and sector transformation Objective 3.1: Lead and coordinate government food security initiatives Rights allocated to 9 sectors Develop sector specific policies and allocate rights to 9 fishing sectors Measurable / Indicator not well defined The indicator per annual performance report, read in conjunction with the target is not clear. Based on our assessment the indicator should measure compliance and or achievement on the FRAP framework.

“SMART” criteria affected Annual Performance Plan 2015-16 Programme 6: Fisheries : Marine Living Resource Fund (continues) Strategic objective Indicator 2015/16 Target “SMART” criteria affected Strategic goal 4: Sustainable use of natural resources in the sector   Objective 4.1: Ensure the conservation, protection, rehabilitation and recovery of depleted and degraded natural resources Objective 4.1.2. Integrated Fisheries Security (IFSS) implemented through inspections and joint operations with partners Plan to recover and maintain prioritised fish stocks Recovery plans for the 3 sectors: Abalone, West Coast Rock Lobster and Deep Water Hake updated 4598 compliance and enforcement measures in the 4 prioritised fisheries sectors: hake, abalone, rock lobster and line fish implemented Measurable / Indicator not well defined The indicator per the annual performance plan, read in conjunction with the target is not well-defined as the indicator should measure achievement of the plan. Target not specific The target is not specific as enforcement measures are not defined.

“SMART” criteria affected Annual Performance Plan 2015-16 Programme 6: Fisheries : Marine Living Resource Fund (continues) Strategic objective Indicator 2015/16 Target “SMART” criteria affected Strategic goal 4: Sustainable use of natural resources in the sector   Objective 4.1: Ensure the conservation, protection, rehabilitation and recovery of depleted and degraded natural resources Plan to recover and maintain prioritised fish stocks Recovery plans for the 3 sectors: Abalone, West Coast Rock Lobster and Deep Water Hake updated Measurable / Indicator not verifiable The indicator per the annual performance plan, read in conjunction with the target is not well-defined as the indicator should measure achievement of the plan.

Annual Performance Plan 2015-16 MTSF Outcomes not fully reported in the APP where DAFF was allocated as the lead department: Outcome 4: Decent employment through inclusive economic growth Indicator (MTSF) First year target (MTSF) Target included in final draft APP Comments Development of smallholder production in context of improved district planning and link to land reform, extension, marketing and other systems.   [DAFF supported by DRDLR, EDD, DTI, NT and DST] Number of small-scale producers (agriculture, forestry and fisheries) supported towards increased market participation and employment Implementation of proposals monitored by DAFF and NT. 2019 target: 300 000 new smallholders Programme 4: I498 smallholders linked to markets Based on discussion with the directorate Strategic Planning the term smallholder producers include agriculture, forestry and fisheries. However, the 5 year target listed [1498] do not agree with the annual target listed [18+32+64+128+256=498 and not 1498 (typing error)]. Also unable to establish whether the 2019 target of 300 000 new smallholders will be met due to a breakdown per department not being available.

First year target (MTSF) Target included in final draft APP Annual Performance Plan 2015-16 Outcome 7: Vibrant, equitable, sustainable rural communities contributing towards food security for all Indicator (MTSF) First year target (MTSF) Target included in final draft APP Comments Implement the comprehensive food security and nutrition strategy.   [DAFF supported by DRDLR, DSD, DBE and DoH] 4,3 million vulnerable people benefiting from food security and nutrition initiatives, translating to 1,6 million households by March 2019 Programme 3: Number of households benefiting from food and nutrition security initiatives 40 000 per annum DAFF is contributing to 200 000 households as per the APP. It is not sure how the target of 4.3 million people and 1.6 million households will be achieved . Based on discussions held with the Strategic Planning directorate and per inspection of the MTSF outcome other departments are supporting DAFF to achieve the 2019 target however a breakdown of how the 4.3 million and 1.6 million targets will be achieved was not available. Develop under-utilised land in communal areas and land reform projects for production. 1 million hectares by March 2019 Number of hectares of under-utilised land in communal areas cultivated for production. 120 000 ha per annum DAFF is contributing to 600 000 hectares as per the APP. It is not sure how the target of 1 million hectares will be achieved. Based on discussions held with the Strategic Planning directorate and per inspection of the MTSF outcome other departments are supporting DAFF to achieve the 2019 target however a breakdown of how the 1 million target will be achieved was not available.

First year target (MTSF) Target included in final draft APP Annual Performance Plan 2015-16 Outcome 10: Protect and Enhance our Environmental Assets and Natural Resources Indicator (MTSF) First year target (MTSF) Target included in final draft APP Comments Hectares of land under rehabilitation/restoration 152 500 ha 80 000 ha The indicator is included in Programme 5: Forestry but the target set is set at 80 000 ha and not 152 500 ha.

BUDGET 2015-16

Comparison between current year and prior year budget 5% 2% 13% 33% 2% 20% 4% % Budget increase % %

Current payments Compensation of employees 1 698,40 1 737,80 39,40 2014-15 R’000 2015-16 Number of employees Increase / (Decrease) Percentage Compensation of employees 1 698,40 1 737,80 39,40 2.3% Programme 1 381,70 391,81 1 203 Programme 2 409,00 423,80 1 510 1 Programme 3 129,50 134,30 472 Programme 4 91,41 91,20 170 Programme 5 510,40 512,10 2 580 Programme 6 176,35 184,64 552 Goods and services 809,50 847,00 37,50 5.0% Total 2 507,90 2 584,80 76,90 3.1%

Transfer and subsidies Transfers and subsidies Transfer and subsidies 2014-15 R’000 2015-16 Increase / (Decrease) Percentage Provinces and Municipalities (breakdown on next slide) 2 390,10 2 189,20 (200,90) (8.4%) Department agencies and accounts (breakdown on next slide) 1 354,60 1 132,50 (222,10) (16.4%) High education institution 7,00 7,80 0,80 11.4% Foreign government and International Organisations 38,70 29,50 (9,20) -24% Public Corporation and Private Enterprises 222,00 312,90 90,90 41% Non Profit Institutions 26,80 26,70 (0,1) (0.4%) Households 8,40 1,90 (6,50) (77.1%) Total 4 047,70 3 700,50 (347,20) (8.7%)

Transfers and subsidies Provinces and Municipalities - Breakdown 2014-15 R’000 2015-16 Municipalities Municipal Bank Account Licences 0,53 0,48 Forestry Arbor City Awards 0,50 0,60 Provinces Provincial Revenue Fund Current Illima/Letsema project fund 460,63 470,77 CASP: Infrastructure 949,59 1 179,01 CASP: Extension Recovery Plans 358,55 343,87 CASP: Upgrading of Provincial Agrucultural Colleges 58,77 69,47 Land Care Programme Grant: Poverty Relief and Infrastructure Development 67,84 66,36 CASP: Flood damaged infrastructure 493,76 58,60 Total 2 390,10 2 189,20

Transfers and subsidies Department agencies and accounts - Breakdown 2014-15 R’000 2015-16 Communication 0,04 0,03 Primary Education Sector Education and Training Authority 0,90 0,94 National Research Foundation 15,00 15,84 Public Service Sector Education and Training Authority 0,37 - Fibre Processing and Manufacturing Sector Education and Training Authority 0,45 0,43 Agricultural Research Council - current 921,46 691,28 Agricultural Research Council - capital 107,70 112,64 National Student Financial Aid Scheme 15,93 14,50 PPECB 0,60 National Agricultural Marketing Council 36,01 34,64 Small Enterprise Development Agency 1,83 Water Research Commision 3,00 Marine Living Research Fund 251,33 258,62 Total 1 354,60 1 132,50

Payment of capital goods 2014-15 R’000 2015-16 Increase / (Decrease) Percentage Building and other Fixed Structures 41,30 42,50 1,20 3% Machinery and Equipment 93,90 53,20 (40,90) (43.34%) Biological Assets 0,20 0,50 0,30 150% Software and other Intangible Assets 0,10 0,00 (0,10) -- Total 135,40 96,20 (39,20) (29%)

Thank You.