1. BRIEFING TO THE STANDING COMMITTEE ON APPROPRIATIONS
2017 APPROPRIATION BILL
BRIEFING TO THE STANDING COMMITTEE ON APPROPRIATIONS
2 June 2017
VISION:
Vibrant, equitable and sustainable rural communities.
MISSION:
To initiate, facilitate, coordinate, catalyse and implement rural development and land reform programmes to achieve agrarian transformation

2. PRESENTATION OUTLINE MTSF PROGRESS REPORT
CORPORATE GOVERNANCE PERFORMANCE (MPAT)
SUMMARY DEPARTMENTAL PERFORMANCE
MONITORING AND EVALUATION

4. Strategic goals Rural Development Administration
Corporate governance and service excellence
Administration
Facilitate integrated spatial planning and land use management.
Ensure integrated and comprehensive land administration system.
Provide a cadastre modernisation programme
Geospatial and Cadastral Serv
Provide support to rural communities in prioritised rural districts to enable them to improve their livelihoods;
Facilitation of infrastructure development;
Facilitate the development of rural enterprises and industries; Increase job opportunities and ensure skills development
Rural Development
Restoration of Land rights
Restitution
Promote equitable land redistribution and agricultural development;
Provide comprehensive farm development support;
Functional systems and institutional arrangements for tenure and land administration
Land Reform

5. APPROPRIATION PER PROGRAMME 2017/18
Appropriation per Programme R'000
2017/18
Administration
1,721,620
NGMS
672,117
Rural Development
1,914,896
Restitution
3,247,384
Land Reform
2,628,223
TOTAL
10,184,240

6. APPROPRIATION PER ECONOMIC CLASSIFICATION 2017/18
Appropriation per economic classification R'000
2017/18
% of total Allocation
Compensation of Employees
2,194,584
21.5%
Goods and Services
1,715,466
16.8%
Provincial And Local Governments
67,542
0.7%
Departmental Agencies & Accounts
1,493,134
14.7%
Foreign Gov&International Organ
1,653
0.0%
Public Corporations & Priv Ent 1
Non Profit Institutions (NPI)
3,492
Households (HH)
4,683,435
46.0%
Machinery and Equipment
24,004
0.2%
Software & Other Intangible assets
929
TOTAL
10,184,240
100.0%

7. KEY FACTS R5.230 billion or 51.4 % of overall budget
Total Budget
R billion
CoE
R2.195 billion
21.5%
Other
R229 million
2.9%
Household projects
R4.665 billion
45.7%
Org. needs
R1.537 billion
15.1%
Transfers to Entities
R1.496 billion
14.7%
R5.230 billion or 51.4 % of overall budget
Contractual commitments (salaries, transfers to entities and organisational needs)
R2.215 billion
Household projects commitments (carried over from 2016/17, Mou/SLA signed, orders issued to service providers)
R1.305 billion
Household projects to go through
normal SCM processes e.g. tender
65.2% of household projects
to go through normal SCM process are projected to be awarded by October 2017

8. BUDGET VS DEPARTMENT POLICY PRIORITIES
Total Budget
R5.638 billion
Rural Development
R1.5 billion
Land Reform
R415.4 million
Land Claims
R2.609 billion
Land Acquisition (ALHA)
R1.420 billion
R1.106 billion
RID & SOYD: Agri-hub; AVMP, FPSU, RVCP, Socio-Economic Infrastructure; Skills development; Revitalisation of Rural Towns; One Integrated Community Dev. Centre; NARYSEC
R432.9 million
REID: Agri-industries; Job opportunities; Agric & Non-Agric Enterprises; Livelihoods; Skills Development
R2.609 billion
Land Claims
R415.4 million
One Household-One Hectare; One Household 2 Dairy Cows
Recapitalisation commitment
R1.420 billion
ALHA (Land Acquisition); One Household One Hectare and Recapitalisation

9. STATE OF READINESS
Demand/procurement plans were linked to project registers and budget to ensure that procurement is at the right time, and at the right cost;
Demand/procurement plans were reliably determined and appropriate sourcing strategies were developed;
A breakdown of monthly anticipated expenditure was developed;
Delivery of services to be regularly monitored to ensure that scarce resources are efficiently and effectively used by regularly tracking, controlling and reporting on expenditure against performance;
Continuation with enforcement of cost cutting measures

10. % COMPLIANCE WITH 30 DAYS PERIOD
Financial Year
% Paid
2013/14
91%
2014/15
92%
2015/16
97%
2016/17
94%

11. REASONS FOR NON-COMPLIANCE
2013/14: Department paid 91% of total invoices submitted that reflects 9% non-compliance with 30 days. Reasons for non compliance were invoice discrepancies, invalid tax clearance certificates and changes in banking details by suppliers without informing the department on time
2014/15: Department paid 92% of total invoices submitted that reflects 8% non compliance with 30 days. Reasons for non compliance were invoice discrepancies, tax clearance certificates that expired and ex-post facto invoices (e.g. photo copy machine used after contract expired and invoices must be presented and approved by National Bid Adjudication Committee).
2015/16: Department paid 97% of total invoices submitted that reflects 3% non compliance with 30 days. Reasons for non compliance were invoice discrepancies, tax clearance certificates that expired and ex-post facto invoices
2016/17: Department paid 94% of total invoices submitted that reflects 6% non compliance with 30 days. Reasons for non compliance were invoice discrepancies, tax clearance certificates that expired and ex-post facto invoices

12. ACTION TAKEN BY THE DEPARTMENT TO COMPLY WITH 30 DAYS REGULATION
Discrepancies of invoices – The department included the invalid invoices within 30 days report; going forward will exclude such invoices until the dispute is resolved. The department communicate the discrepancies with service provider eg. Quotation submitted without VAT or Interest while invoice submitted with VAT and Interest for payments. Department will request revised and valid invoice to be submitted.
Invalid tax clearance certificates – When the department contracted the service provider tax clearance certificate was still valid. With the implementation of the CSD, the department is able to access Tax Clearance information, if Tax Clearance is not valid department communicates with service provider to address issues with SARS. Until queries/ issues with SARS are resolved the department will not include those invoices within 30 days report.
Changes in banking details by suppliers - When the department contracted the service provider banking details were still valid. With the implementation of CSD, the suppliers update the banking details and must submit copy to the department. Until banking details issues are addressed the department will not included those invoices within 30 days report.
Ex-post facto invoices – Contract management sends reminders to service provider and departmental officials three months before expiry date. If service providers don’t collect machine and officials continue to use the machine; regarded as irregular expenditure - referred to Finance Control Committee (FCC) .
The department established Finance Control Committee to ensure effective and efficient execution of the Irregular, Wasteful and Fruitless Expenditure and Financial misconduct policies.
Consequences management is applied after investigation by FCC.

13. AGRICULTURAL LAND HOLDING ACCOUNT (ALHA) 2016/17 ESTIMATES OF NATIONAL EXPENDITURE (ENE) PRESENTATION

14. ALLOCATION PER STANDARD ITEM
Strategic Land Acquisition
2017/18
R 000
Land Acquisition
Strengthening of Relative Rights (50/50)
Planning
19 344
Total
Recapitalisation and Development
Recap: (Commitments)
One Household One Hectare (1H1H)
Total Recap
Total ALHA Projects
Other Expenses
Curator fees
5 861
Project Management Unit fees
71 149
Rates and Taxes
47 494
Total other expenses
Total Transfer Received

15. (2014/15 to 2016/17 PERFORMANCE TRENDS)
MTSF PROGRESS REPORT
(2014/15 to 2016/17 PERFORMANCE TRENDS)

16. OVERALL YEAR-ON-YEAR DEPARTMENTAL PERFORMANCE
The Department had the highest-ever Fourth Quarter and Annual performances of 94% and 97% respectively, over the past three Financial Years.

17. PRODUCTIVE LAND OWNED BY PREVIOUSLY DISADVANTAGED INDIVIDUALS
MTSF aims to increase percentage of ownership of productive land by previously disadvantaged individuals by acquiring 2 million hectares of land by 2019:
For the period 2014/15 to 2016/17, DRDLR targeted 843,074ha, and acquired 798,788ha.
This translates to 40% progress towards the 2 million hectare target.
For the next MTEF, a total of 281,165ha of land is planned for.
Performance Indicator
Audited / Actual Performance
Estimated Performance 2016/17
Medium-term Targets
2014/15
2015/16
2017/18
2018/19
2019/20
Number of hectares acquired
96 165
90 000
95 000

18. PRODUCTIVE LAND OWNED BY PREVIOUSLY DISADVANTAGED INDIVIDUALS
MTSF aims to allocate 1 million ha of land acquired to smallholder producers by 2019:
For the period, 2014/15 to 2016/17, DRDLR targeted 226,492ha, and 384,132ha was allocated.
This translates to 38% towards the 1 million ha MTSF target.
Over the next MTEF, a total of 140,500ha is planned for.
Performance Indicator
Audited / Actual Performance
Estimated Performance 2016/17
Medium-term Targets
2014/15
2015/16
2017/18
2018/19
2019/20
Number of hectares allocated to farm dwellers and labour tenants
New indicator
48 000
45 000
47 500

19. PRODUCTIVE LAND OWNED BY PREVIOUSLY DISADVANTAGED INDIVIDUALS
MTSF aims to allocate 200,000 ha of land acquired to farm-dwellers and labour tenants by 2019:
For the period, 2014/15 to 2016/17, DRDLR targeted 45,326ha, and 22,185ha were allocated.
This translates to 11% towards the 200,000 ha MTSF target.
Over the next MTEF, a total of 28,100ha is planned for.
Performance Indicator
Audited / Actual Performance
Estimated Performance 2016/17
Medium-term Targets
2014/15
2015/16
2017/18
2018/19
2019/20
Number of hectares allocated to farm dwellers and/or labor tenants
New indicator
3 910
18 275
9 600
9 000
9 500

20. REDUCTION OF LAND TRANSFERRED TO PREVIOUSLY DISADVANTAGED INDIVIDUALS WHICH IS UNDERUTILISED
MTSF aims to provide support to1 741 farms under RECAP by 2019:
For the period 2014/15 to 2016/17 DRDLR targeted 985 farms, and 994 farms were supported.
This translates to 57% towards the farms MTSF target.
This performance indicator was moved to DAFF as of 2017/18.

21. DEVELOPMENT OF SUSTAINABLE RURAL ENTERPRISES
NDP states that, “small- and medium-sized enterprises will play an important role in employment creation’’.
For the period, 2014/15 to 2016/17, DRDLR targeted 592 enterprises, and the target was achieved with 886 supported.
Over the next MTEF, DRDLR is targeting 531 enterprises.
Performance Indicator
Audited / Actual Performance
Estimated Performance 2016/17
Medium-term Targets
2014/15
2015/16
2017/18
2018/19
2019/20
Number of new agricultural enterprises supported in the 44 districts aligned to Agri-Parks
422
220
193
141
150
159
Number of new non-agricultural enterprises supported in the 44 districts
New indicator 51 55 60 66

22. PRODUCTIVE LAND OWNED BY PREVIOUSLY DISADVANTAGED INDIVIDUALS
Claims Settled: Commission targeted total settlements for the period 2014/15 to 2016/17, and they achieved
There are projected claims to be settled over the next MTEF.
Performance Indicator
Audited / Actual Performance
Estimated Performance 2016/17
Medium-term Targets
2014/15
2015/16
2017/18
2018/19
2019/20
Number of land claims settled
428
617
812
1 001
1 151
1 179

23. PRODUCTIVE LAND OWNED BY PREVIOUSLY DISADVANTAGED INDIVIDUALS
Claims Finalised: Commission planned for claims over the period 2014/15 to 2016/17, and a total of claims were finalised.
There are projected claims to be finalised over the next MTEF.
Performance Indicator
Audited / Actual Performance
Estimated Performance 2016/17
Medium-term Targets
2014/15
2015/16
2017/18
2018/19
2019/20
Number of land claims finalised
372
560
672
724
832
865

24. SKILLED & CAPABLE WORKFORCE TO SUPPORT AN INCLUSIVE GROWTH PATH
The MTSF aims to have skilled people by 2019:
DRDLR targeted (including NARYSEC) skills opportunities, and was achieved.
NARYSEC target amounts to
Overall, this translates to a contribution of 37% towards the MTSF target.
Over the next MTEF, a total of is planned for.
Performance Indicator
Audited / Actual Performance
Estimated Performance 2016/17
Medium-term Targets
2014/15
2015/16
2017/18
2018/19
2019/20
Number of skills development opportunities provided in rural development initiatives
12 331
12 576
8 002
6 612
5 200
5 400

25. REDUCE UNEMPLOYMENT RATE IN THE RURAL AREAS
The MTSF aims to have 924,140 people employed through the rural development initiatives, including enterprises and industries by 2019:
DRDLR targeted 21,678 jobs over the period under review, and achieved 23,739.
This amounts to a contribution of 2.6% towards the MTSF target.
Over the next MTEF, a total of 35, 687 is planned for.
Performance Indicator
Audited / Actual Performance
Estimated Performance 2016/17
Medium-term Targets
2014/15
2015/16
2017/18
2018/19
2019/20
Number of job opportunities created in rural development initiatives
4 916
6 005
5 880
5 448
6 700
Number of jobs created in in the Land reform programme
1 925
2 271
2 742
5 000
5 775
6 064

26. CORPORATE GOVERNANCE PERFORMANCE (MPAT)

27. MPAT SUMMARY PERFORMANCE
LEGEND
MPAT
MPAT
MPAT
MPAT
MPAT 1.6
2016
Level 4-Fully Compliant & Smart 1 8 14 16 19
Level 3-Fully Compliant 10 5
Level 2+ - Compliant with basics - 4
Level 2-Partially Compliant 11 6
Level 1- Non-Compliant 7 3
TOTAL SCORES 28 32 34 37 35
PERFORMANCE RATING (%)
39%
56%
65%
78%
80%
Compared to the past 4 MPAT cycles, the Department scored the highest-score ever of 80% during the 2016 MPAT cycle!
Now that the Department has achieved this target, the key question is, to what extent can this be translated into the overall Departmental Performance?

28. KEY PERFORMANCE AREA 1: STRATEGIC MANAGEMENT
LEGEND
MPAT
MPAT 1.5
2015
Moderated Score 2016
Level 4-Fully Compliant & Smart 5 3
Level 3-Fully Compliant 2
Level 2+ - Compliant with basics -
Level 2-Partially Compliant
Level 1- Non-Compliant

29. KEY PERFORMANCE AREA 2: GOVERNANCE AND ACCOUNTABILITY
LEGEND
MPAT
MPAT
Moderated score 2016
Level 4-Fully Compliant & Smart 5 7
Level 3-Fully Compliant 2 1
Level 2+ - Compliant with basics -
Level 2-Partially Compliant
Level 1- Non-Compliant 3

30. KEY PERFORMANCE AREA 3: HUMAN RESOURCE MANAGEMENT
LEGEND
MPAT
MPAT 1.5
2015
Moderated score 2016
Level 4-Fully Compliant & Smart 1
Level 3-Fully Compliant 4 3
Level 2+ - Compliant with basics -
Level 2-Partially Compliant 5
Level 1- Non-Compliant 2

31. KEY PERFORMANCE AREA 4: FINANCIAL MANAGEMENT
LEGEND
MPAT
MPAT 1.5
2015
Moderated score 2016
Level 4-Fully Compliant & Smart 6
Level 3-Fully Compliant 1 2
Level 2+ - Compliant with basics -
Level 2-Partially Compliant
Level 1- Non-Compliant

32. GENERAL INFORMATION

33. PRE-AUDITED 2016-2017 PROGRAMME PERFORMANCE
The Department achieved 79% of its Annual targets (APR) for the Financial Year.
NATIONAL
Programmes
APR Targets Planned
APR Targets Achieved
APR Partially-Achieved
APR Not-Achieved
APR Performance
Administration 2 1
50%
Geospatial and Cadastral Services 5 4
80%
Rural Development 7 6
86%
Restitution 3
100%
Land Redistribution and Development 8
75%
Land Tenure and Administration
Overall Total 29 23
79%

34. DRDLR PERSONNEL COMPOSITION : FY2016/2017
Total
Programme 1: Administration
Programme 2: National Geomatics Management Services
Programme 3: Rural Development
Programme 4: Restitution
Programme 5: Land Reform
Programme : Deeds
Head count (31/03/2017)
5 529
1 467
1 057
482
735
617
1 171
Number of funded posts
5 370
1 450
782
477
737
624
1 300
Number of posts additional to the establishment
372 45
286 18 6 8 9
Number of posts filled
5 157
1 422
771
464
729
609
1 162
Number of posts vacant
213 28 11 13 15
138
% Vacancy rate
3.97%
1.93%
1.41%
2.73%
1.09%
2.40%
10.62%

35. INTERNAL AUDIT AND AUDIT COMMITTEE
The Internal Audit function is a fully-fledged Chief Directorate, which reports operationally to the Audit Committee and administratively to the Director-General. It is constituted of three Directorates (Performance Audit and Financial Audit; Operational Audit and Compliance Audit; and Information Technology Audit) and one Sub-Directorate (Project Management and Quality Assurance). During the past year, Internal Audit issued 20 Audit Committee Reports and 51 Detailed Internal Audit Reports.
Audit Committee
The Audit Committee of the DRDLR, the Deeds Registration Trading Account and the Agricultural Land Holding Account consists of three members and had 7 meetings during the past year.
Independent Assessments of Internal Audit’s and the Audit Committee’s effectiveness:
Institute of Internal Auditors Quality Assessment Review:
Internal Audit’s conformance to the International Standards for the Professional Practice of Internal Auditing was assessed by the Institute of Internal Auditors as ‘Generally Conforms’, which is the optimal conformance level.
MPAT:
Both Internal Audit and the Audit Committee received MPAT scores of 4.0 for the last four years. This is the highest MPAT score and indicates that Internal Audit and the Audit Committee are fully compliant with legal/regulatory requirements and are doing things smartly.

36. INTERNAL AUDIT AND AUDIT COMMITTEE cont
AGSA:
The following table outlines the AGSA assessments on the Chief Directorate: Internal Audit and Audit Committee over the last three years. The symbols reflected below indicate that the required preventative or detective controls are in place.

37. SUMMARY EVALUATION STUDIES CONDUCTED
Socio economic impact on CRDP – 2012 (Internal),
Implementation evaluation of the CRDP – 12/13 (DPME/DRDLR),
Implementation evaluation of the Recapitalization and Development programme -12/13 (DPME/DRDLR)
Implementation evaluation of the Restitution Programme -13/14 (DPME/DRDLR),
Implementation and design evaluation of NARYSEC- 13/14 (Internal),
Implementation evaluation of PLAS – 14/15 (Internal)
Design and implementation evaluation of AVMP-15/16( internal),
Diagnostic evaluation of strengthening relative rights of people working the land (50/50) policy framework- 16/17(internal).

38. THANK YOU