1. Presentation to Portfolio Committee
DEPARTMENT OF LABOUR
IES
Presentation to Portfolio Committee 1

2. Table of Content Background IES Strategy Basis for Proposal
Developing trends in the IES field
Strategic Imperatives
Benchmarking
A. Current realities
Implications thereof 2

3. Table of Content 10. Request for Goods and Services budget
B. Request for Improved Staff Establishment
12. Assumptions
13. How post will be distributed
14. Different Scenarios (100; 60 and 30%)
15. Action Plan
7/18/2018

4. Background
Inspection and enforcement services are committed to the following strategic objective:
To promote good labour practices including sound labour relations, improved conditions at work and minimum wages, fair labour practices and healthy and safe working environment. We are enforcing the law to achieve these objectives.

5. IES Strategy
It is common cause that the IES strategy is premised on three pillars:
Advocacy and Awareness creation
Inspections and
Enforcement.
7/18/2018

6. Basis for Proposal This proposal is developed against the backdrop of:
The changing nature of work we are currently experiencing
The inspectorate being the primary mode of service delivery of the department
The reality that our inspectorate is not geared towards meeting these changing demands
7/18/2018

7. Developing Trends in the Labour Market
The rate of OHS incidents in the country continue to increase. The construction industry alone, two fatalities are occurring a week
The amount of money that the country bleeds as a result of workplace incidents is in excess of R2 billion (CF Claim stats 2012)
 Amendments to the Labour legislation.
7/18/2018

8. Developing Trends in the labour market
New legislation PESA
Currently there are at least three other pieces of labour legislation proposed for amendments
Secondary legislation e.g. sectoral determinations as well as the introduction of a national minimum wage)
21 OHS regulations that requires an inspectorate that is fit for purpose.
7/18/2018

9. Strategic Imperatives
Both the NDP and the MTSF obliges us to contribute to the key outcomes such as:
A long and healthy life for all (Promotion of occupational health services)
Strengthening of social protection (development of occupational health and safety policies)
Transforming the society and uniting the nation (promotion of equity in the workplace
7/18/2018

10. Benchmark
Based only on one discipline, Occupational Health and Safety, the ILO benchmark is 1 Inspector for every members of the workforce.
In terms of the Quarterly Labour Force Survey (February 2015) RSA has employed persons.
It means that South Africa requires 1011 OHS inspectors for the economically active population but for employed works would require 766 inspectors.

11. Current reality
Dol has a total staff establishment of inspectors with 1247 filled.

12. Total budget for IES
Table 2 Cost of current Inspectorate 2014/15
Sum IES
Salaries
Employer Contribution
Total
Budget Allocation
Surplus/ -Shortfal
DDG
2,683,404.00
390,276.00
3,073,680.00
11,456,000.00
8,382,320.00
CD IES
18,306,373.00
2,717,293.00
21,023,666.00
18,234,000.00
-2,789,666.00
CD S&AS
4,616,616.00
634,493.00
5,251,109.00
2,731,000.00
-2,520,109.00 EC
35,438,070.00
6,373,736.00
41,811,806.00
32,470,000.00
-9,341,806.00 FS
26,931,832.00
4,804,877.00
31,736,709.00
24,548,000.00
-7,188,709.00 GP
71,260,999.00
12,828,161.00
84,089,160.00
66,785,000.00
-17,304,160.00
KZN
59,489,639.00
11,181,138.00
70,670,777.00
56,963,000.00
-13,707,777.00 LP
29,097,330.00
4,696,416.00
33,793,746.00
26,508,000.00
-7,285,746.00 MP
26,942,402.00
4,643,816.00
31,586,218.00
23,678,000.00
-7,908,218.00 NC
15,595,422.00
2,534,096.00
18,129,518.00
115,343,000.00
97,213,482.00 NW
23,905,014.00
4,191,662.00
28,096,676.00
22,361,000.00
-5,735,676.00 WC
35,379,928.00
6,356,927.00
41,736,855.00
32,858,000.00
-8,878,855.00
349,647,029.00
61,352,892.00
410,999,921.00
333,935,000.00
-77,064,921.00

13. 2015/16 of Goods and Services
The allocated budget is R Of this amount the allocation for inspections is around R49 000 000.
The remainder of the budget is utilized for operational matters
However to deliver on our current Annual Performance Plan as approved by cabinet the goods and services budget required by IES for goods and services for inspections only is set out in the table below based on an average cost R per inspection:

14. Operational cost to fund APP
2016/17
Indicators
Totals numbers
Total inspection costs
Employment Equity
5271 R
Vulnerable workers R
High risk sector(OHS)
21 909 R
Employer audits
12 386 R
Totals R
Therefore in terms of the operational budget, we are already projecting a shortfall.

15. Implications for increased targets over the MTEF
2015/16
Indicators
Totals numbers
Total inspection costs
Employment Equity
4 926 R
Vulnerable workers R
High risk sector(OHS)
20 476 R
Employer audits
11 576 R
Totals R

16. Cost of Employment (CoE)
The current approved staff establishment is 1347 inspectors. Of these we have 100 vacancies.
The total CoE budget is (R349  ) This only covers the filled posts.
You would recall that Treasury reduced the IES budget by R64 million).
We thus had to freeze these vacancies because of the shortfall created by this reduction.

17. Funding of IES: CoE(current)

18. Current IES Reality
 from the latest establishment report (March 2015) IES requires R million for the approved establishment (1 347 full time equivalent posts).
The filled posts (1 247 FTE posts) require R million.
The current vacancies (100 FTE posts) amount to R million.
Therefore IES have a shortfall of R million for 2015/16.

19. Current IES Reality
These amounts include the NT projected annual salary increase of 5.8% from 1 April 2015 and a 1.5% Pay Progression System increase from 1 July 2015 for qualifying officials.
Please note that these amounts exclude the 1.5% of establishment for merit awards.
It should therefore be noted very clearly that the additional budget of R64  intended for the next ( ) financial year can only be utilized to address the deficit on the approved staff establishment.

20. Implications
There will be no budget to appoint additional inspectors. The R64m intended for the financial does not address the shortfall in the goods and service budget.
Of critical importance now however is to fill the staff establishment as approved.
It would be foolhardy to utilize this funding to fill vacancies and we do not allow inspectors to conduct inspections since we do not provide the concomitant goods and services budget.

21. Request for Goods and Services funding
The department acknowledges that within this tight fiscal framework, it would be difficult to request an additional R77 million on goods and services in addition to the proposed R64million earmarked. Therefore a proposal to spread this load is set out in the following table.

22. percentage allocation per annum
Proposal
Additional required goods and services for the approved staff establishment:
percentage allocation per annum
2016/17
40%
77,443,452.92
30,977,381.17
2017/18
20%
15,488,690.58
2018/19

23. B. Proposal for improved Staff Establishment

24. Assumptions The following assumptions are made:
That the organisation sits with a critical shortage of inspectors
The proposal however is made to establish critical capacity in all three major areas with a focus on Employment Equity as well as Occupational Health and Safety

25. Assumptions
Any improvement plan should recognize the tight fiscal environment
Three different possible scenarios is proposed (a) a full funded scenarios; (b) funding only provided for 60% of the proposal and (c) funding provided for 30% of the proposal.

26. Assumptions
All three disciplines and a possible spread over labour centres is provided
Additional requirement is 636 ( 500 OHS Inspectors and 100 EE and 36 BCEA inspectors
Large Labour Centres will consist of the following posts:
1 - SR12 Control Inspector
6- SR10 Principle Inspectors for the following fields:
OHS
BCEA and
EEA

27. How posts will be distributed:
Estimated deployment per province
Eastern Cape 95
15%
Free State 32 5%
Gauteng
159
25%
Kwazulu Natal
127
20%
Limpopo
Mpumalanga
Northern Cape
North West
Western Cape
636
100%

28. Scenario 1: 100% funded

29. Compensation of Employees 100% funded
SR Level
Number
Annual COE cost pp
Total Cost 12 27 10
478 8
131
636

30. Goods and services (100% funded
ITEM
Number
Annual cost per post
Total Costs
Comments
Office furniture
636
once off
Cell Phones
Transport cost
1700km
Accommodation
1300*20 nights pp
Stationary/uniform/etc
Total: Goods and Services
Total Requirement

31. Scenario 2: 60% funded

32. Compensation of Employees 60% funded
SR Level
Number
Annual COE cost pp
Total Cost 12 27 10
250 8 79
356

33. Goods and services (60% funded
ITEM
Number
Annual cost per post
Total Costs
Comments
Office furniture
356
once off
Cell Phones
Transport cost
1700km
Accommodation
1300*20 nights pp
Stationary/uniform/etc
Total: Goods and Services
Total: Requirement

34. Scenario 3: 30% funded

35. Compensation of Employees 30% funded
SR Level
Number
Annual COE cost pp
Total Cost 12 8 10
143 39
190

36. Goods and services (30% funded)
ITEM
Number
Annual cost per post
Total Costs
Comments
Office furniture
190
once off
Cell Phones
Transport cost
1700km
Accommodation
1300*20 nights pp
Stationary/uniform/etc
Total: Goods and Services
Total: Requirement

37. Action Plan # Activity Responsible person Date Comments
Budget allocation
National Treasury
2016/17 financial year 2 
Job profiles finalised OD
Q2 – 2015/16 3 
Adverts placed
CS Branch
Q3 – 2015/16 4 
Interviews
IES Branch
Q4 – 2015/16 5 
Posts filled
Q1 – 2016/17 6 
Resources provided:
Cars
Legislation
Personal Protective Equipment
Furniture
Offices
Cell phone/Tablet
Stationery
Suit case to carry inspection equipment (notices; legislation, etc.)
Notices (prohibition; Contravention and Improvement)
 IES Branch
  On appointment and as competency is found to be adequate 7 
Training:
Q /17 to Q /18
Training will take place in groups. Each groups training will be staggered. Training will be conducted over six (6) months for each group. 8 
Support through Mentoring/Coaching programme
Schedule to be drafted.
Coaches and mentors to be trained where this has not already taken place. 9 
Competency requirements met
Q /17 to Q /18
Testing will take place throughout the training programme.
10 
Issuing of inspector cards
At end of course
Inspector understands mandate.

38. What is required from the Portfolio Committee
The Portfolio Committee is requested to:
Take note of the Department of Labour's plan to strengthen the inspectorate.
Support the Department of Labour in its quest to strengthen the inspectorate.

39. Thank You 39