1. NEDLAC PRESENTATION TO THE SELECT COMMITTEE
ANNUAL REPORT OF NEDLAC FOR 2016/17 FINANCIAL YEAR
07 November 2017

2. Summary of Performance Major achievements Expenditure 2016-17
CONTENTS
Summary of Performance
Major achievements
Expenditure
Priorities for

3. SUMMARY OF PERFORMANCE ON THE 2016 –17 APP
Programmes
Total No. of annual targets
No. of annual targets achieved
No. of annual targets not achieved
Overall Performance % 1.
Administration 15 10 5
67% 2.
Core Operations 33 28
85% 3.
Constituency Capacity Building Funds 3
100% 4.
Summary of performance 51 41
80%

4. MATTERS CONCLUDED: 2016-17 APP - LEGISLATION
10 pieces of legislation and policy concluded:
Matter
Period of engagement
1. Communal Property Association Amendment Bill
3 months
2. National Road Safety Strategy
3. Green Paper on International Migration
4. Airports Company Amendment Bill
4 months
5. Air Traffic Navigation Services Amendment Bill

5. MATTERS CONCLUDED: 2016-17 APP – LEGISLATION CONT.
Period of engagement
6. Border Management Authority Bill
6 months
7. Market Conduct Policy
9 months
8. Financial Sector Regulations Bill
17 months
9. Occupational Health and Safety Amendment Bill
21 months
10. Public Holidays vs Religious Cultural Holidays
15 months

6. SUMMARY OF PERFORMANCE ON THE 2016 –17 APP
10 Special sessions on policy issues:
Session
Chamber
1. Medium Term Budget Policy Statement
Public Finance & Monetary Policy
2. Tax Ombudsman role and challenges
3. Financial Inclusion
4. Employment Tax Incentive
5. Decent Work Country Programme
Labour Market
6. Engagement with the Commission for Employment Equity
7. Engagement with Productivity SA
8. Dairy Sector Session
Trade & Industry
9. Proudly SA: Localisation
10. Financial Sector Engagement
MANCO Project

7. SUMMARY OF PERFORMANCE ON THE 2016 –17 APP
5 research projects concluded:
Research
Chamber
1. Operation Phakisa
Development
2. Impact of the Employment Tax Incentive Act
Public Finance &
Monetary Policy
3. African Growth and Opportunity Act
Trade & Industry
4. WTO Trade in Services Agreements
5. The Code of Good Practice on Collective Bargaining, Industrial Action and Picketing
Labour Market

8. SUMMARY OF PERFORMANCE ON THE 2016 –17 APP
9 Section 77 Applications : 5 Concluded; 4 in progress
Applicant
Issue
Status
1. COSATU
State of public transport in the Western Cape
Concluded
2. AMCU
Continuous escalation of accidents in the mining sector
3. COSATU
Against the construction of De Beers Bypass in Free State.
4. NUM
Termination of recognition agreement by Sibanye Gold
5. NUMSA
Closure of coal-fired power stations by Eskom

9. SUMMARY OF PERFORMANCE ON THE 2016 –17 APP
Applicant
Issue
Status
6. COSATU
Free Higher Education in South Africa
In Progress
7. ICTU
Economic Policy, National Minimum Wage and Free education
In progress
8. FEDUSA
Lack of competency on the leadership of State Owned Companies.
9. COSATU
Water crisis in the Western Cape

10. MAJOR ACHIEVEMENTS

11. MAJOR ACHIEVEMENTS FOR THE YEAR UNDER REVIEW
Obtained an unqualified audit opinion for the 2016–17 Financial Year (with material findings).
Convened the Future of Work workshop, in partnership with the International Labour Organisation ILO
National Minimum Wage Agreement signed by social partners
Established a high level task team on Comprehensive Social Security.

12. CHALLENGES AND REMEDIAL ACTION

13. CHALLENGES EXPERIENCED AND REMEDIAL ACTION
Some targets not achieved in terms of the APP
KEY PERFORMANCE INDICATORS
QUARTERLY TARGET
REASON FOR VARIANCE
1. Secure back-up of data.
3 off-site data back-ups.
The off-site back-up performance agreement with SITA was not finalised in the 1st, 2nd and 3rd quarter, due to the high costs involved (R650, ). The agreement was only entered into with a different Service Provider (Cibecs Data Fox) during quarter 4 at a cost of R120, for the entire year.

14. CHALLENGES EXPERIENCED AND REMEDIAL ACTION
KEY PERFORMANCE INDICATORS
QUARTERLY TARGET
REASON FOR VARIANCE
2. Finalise Nedlac Report on Draft legislation
Finalise Nedlac Report on the consideration of the report on Public Holidays vs Religious Cultural Holidays was tabled for engagement to the Development Chamber on 09 September 2015.
The task team requested the Commission for the Protection of the Rights of Cultural, Religious and Linguistic Communities to submit a Socio-economic Impact Assessment report on the proposed amendments.
The task team noted the inability of the Commission to submit the SEIAS, despite the extended period in which it was given to do so. It was then agreed that the Commission would re-table the proposed amendments at Nedlac with the SIAS report.

15. CHALLENGES EXPERIENCED AND REMEDIAL ACTION
KEY PERFORMANCE INDICATORS
QUARTERLY TARGET
REASON FOR VARIANCE
3. Finalise NEDLAC Report on draft legislation
Finalise NEDLAC Report on Financial Sector Regulations Bill.
The Financial Sector Regulations Bill was tabled on 13 May Government, at the task team meeting, requested to engage internally on the draft Bill before submitting a revised version. Government reported back to the task team in Quarter 1 of 2016/17.

16. OTHER CHALLENGES EXPERIENCED AND REMEDIAL ACTION
4. Shortage of human resources, (Exacerbated by the resignation of the senior members of the organisation, namely: Head: Programme Operations; Supply Chain Coordinator; Communications Coordinator and Senior Coordinator for TIC).
The positions of Head of Programme Operations; Supply Chain Coordinator and TIC Senior Coordinator have been filled.
To establish staff benefits such as medical aid, pension fund to ensure retention of staff.
5. The Unqualified Audit opinion with findings by Auditor- General
Action Plan developed and is being implemented.

17. MEASURES TO ADDRESS AUDIT FINDINGS ON FINANCIAL MISSTATEMENTS
Management has:
Implemented the SCM process to appoint service providers who provide services to the constituencies. In this regard, Nedlac pays the service providers directly, rather than transferring funds into constituencies’ bank accounts.
Amended a procurement checklist to ensure that the appointed suppliers are registered with CSD.
Implemented an integrated HR and Payroll management electronic system which will ensure that information relating to leave is accurate.

18. MEASURES TO ADDRESS AUDIT FINDINGS ON FINANCIAL MISSTATEMENTS CONT.
Fixed asset verification is undertaken on quarterly basis.
The deviation management process has been improved by amending the deviation checklist, to ensure that all deviations are recorded accurately and are complete.
Developed a satisfaction rating form which is used by user departments to monitor and rate the services rendered by contracted services providers.
Developing a methodology to ensure that a proper process of revaluing assets, reassessment of useful life and residual values is followed annually.

19. BUDGETED INCOME FOR 2016/17 FINANCIAL YEAR
Description of income
Amount 1.
Grant from Department of Labour
R30,817,000.00 2.
Interest Received
R420,000.00 3.
Sundry Income
R132,000.00 4.
Total income
R31,369,000.00

20. BUDGET ALLOCATION FOR THE 2016/17 FINANCIAL YEAR

21. EXPENDITURE 2016/17

22. EXPENDITURE 2016/17
Programme 1: Over-expenditure for 2016/17 financial year is largely due to:
National Minimum Wage activities, which also impacted on expenditure in Programme 2 (Core Operation);
Increase in expenditure relating to security services and audit fees.
Programme 2: Over-expenditure in this programme resulted from the increase in the cost of research projects undertaken by the four chambers of Nedlac.
Programme 3: Under-expenditure incurred largely due to implementation of cost containment measures and also some due to actual costs being less that initially estimated.

23. ORGANISATIONAL PRIORITIES FOR 2017/18
Enhancing Financial Management
Enhance risk management systems and compliance.
Seek additional funding in order to address the issue of underfunded projects which are undertaken by Nedlac.
Effective implementation of the audit action plan.

24. ORGANISATIONAL PRIORITIES FOR 2017/18
Programmes
Enhance communication and outreach, which would entail forming strategic partnerships with other communicators, and healthy relationships with the media.
The National Minimum Wage (NMW) will remain one of the key deliverables for Nedlac, and also ensuring that the work that flows from the NMW lives beyond the implementation date of May 2018.
Comprehensive Social Security (CSS) will form a pivotal part of Nedlac’s work, ensuring that South Africans who are currently outside the security net are also covered.
Substantially advance engagement on work of the National Health Insurance ( NHI).
To continue with the consideration of Section 77 Notices in line with the Nedlac Protocol and Code of Good Practice.

25. ORGANISATIONAL PRIORITIES FOR 2017/18
Human Resources:
Improve capacity of the secretariat to attract and retain highly skilled staff to carry out the mandate of Nedlac.
Build research capacity in line with the ILO recommendations

26. CONCLUSION
Nedlac remains committed to advance social dialogue and promote participation of social partners towards addressing socio-economic challenges in the country.
All efforts will be made during the 2017/18 financial year to ensure that the set performance targets are achieved.
Nedlac will continue to strive for an unqualified audit results for the current financial year while fervently pursuing its mandate.

27. Thank You…