1. INGONYAMA TRUST BOARD ANNUAL REPORT 2014 - 2015
BRIEFING TO THE SELECT COMMITTEE ON LAND AND MINERAL RESOURCES
17 MAY 2016
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2. PRESENTATION OUTLINE Background of the ITB
Overview of the Ingonyama Trust Board
Allocation, monitoring and reporting of grants
Performance Report – Non financial
Performance Report – Financial
Auditor – General’s Report on performance (predetermined objectives)
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3. BACKGROUND
Ingonyama Trust was established in 1994, in terms of the KwaZulu Ingonyama Trust Act, (Act No 3KZ of 1994),
The mandate of the Trust was to hold land for “the benefit, material welfare and social well-being of the members of the tribes and communities” living on the land.
The Act was amended in 1997 and the amendments came into effect in 1998,
His Majesty the King Goodwill Zwelithini Zulu is the sole Trustee of the land. The Amendment Act provides, among other things, for the establishment of Ingonyama Trust Board to administer the affairs of the Trust and the Trust land.
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4. Mandate of ITB
The Ingonyama Trust Board, “the Board” is a schedule 3A Public Entity reporting to the National Minister for Rural Development and Land Reform.
Objective
Optimal land management for the material benefit and social well-being of the communities living on Ingonyama Trust Land

5. LEGISLATIVE AND OTHER MANDATES
Constitutional Mandates
Constitution of the Republic of South Africa, 1996 (Act No. 108 of 1996)
The mandate of the Ingonyama Trust Board is derived from sections 25 and 27 of the Constitution. Section 25 (property clause) confirms the framework for the granting of tenure rights on land, and section 27 (health care, food, water and social security clause) confirms the framework for the provision of support to rural communities residing under Ingonyama Trust land.
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6. Legislative mandates
The Ingonyama Trust Board obtains its legislative mandate as follows:
Ingonyama Trust Act, 1994 (Act No. 3 KZ of 1994) as amended by Act 9 of 1997
The Ingonyama Trust was established in 1994 by the KwaZulu Ingonyama Trust Act, (Act No 3 of 1994) and the KwaZulu - Natal Ingonyama Trust Amendment Act No 9 of 1997.
Section 2 (2) of the Ingonyama Trust Act establishes the framework for the administration of the land for the benefit of communities.
Section 2 (5) of the Ingonyama Trust Act establishes the framework in which land rights are to be granted and at the same time protecting trust land.
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7. POLICY MANDATES
All policies of the National government pertaining to land apply to Ingonyama Trust land.
Policies like environmental affairs, water, and conservation equally apply on Ingonyama Trust land.
Indigenous law practices and communal land act principles are applicable in land allotment. Therefore the Board as a matter of policy has advanced a practice that beneficiaries of this communal land should opt for a lease as a formal instrument of their right in a communal setup.
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8. THE BOARD
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9. BOARD COMMITTEES 2019/05/24 EXECUTIVE COMMITTEE
The Executive Committee (EXCO) is chaired by the Chairperson or Vice Chairperson of the Board or any member elected in terms of Regulation 9 of the Administrative Regulations of Ingonyama Trust Board. The membership of this Committee consists of not less than two members of the Board.
The powers and functions of this committee are as follows:
• To deal with any matters specifically delegated to it by the Board,
• To generally manage the Trust land in terms of the Act, Government policy and the Board’s policies between sittings of the Board,
• To make recommendations to the Board on policies, procedures generally and in relation to specific cases.
TENURE RIGHTS COMMITTEE
The Tenure Rights Committee is chaired by the Chairperson or Vice Chairperson of the Board or any member elected in terms of Regulation 9 of the Administrative Regulations of Ingonyama Trust Board. The membership of this Committee consists of not less than two members of the Board.
• To decide on behalf of the Board the granting or refusal of applications for any and all forms of tenure rights, • To make recommendations to the Board on land tenure matters.
AUDIT COMMITTEE
The Audit Committee reviewed the performance of the Board and the Secretariat to ensure that they complied with the PFMA, Financial Regulations, Treasury Regulations and other relevant pieces of legislation and directives.
BID ADJUDICATION COMMITTEE
During the period under review the Bid Adjudication Committee ensured that procurement is fair, equitable, transparent, competitive and cost-effective in accordance with the Supply Chain Management policy and the PFMA.
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10. THE ALLOCATION,MONITORING AND REPORTING OF GRANTS
The Ingonyama Trust Board does not pay any grants, however receives a transfer payment from the Department of Rural Development and Land Reform. For 2014/2015 an amount of R 17.3 m was received and utilised.
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11. STRATEGIC PLAN PERFORMANCE REPORT
STRATEGIC OBJECTIVES
PERFORMANCE MEASURE INDICATOR
TARGETED PERFORMANCE
AUDITED PERFORMANCE
VARIANCE
Unlocking an enabling environment conducive to development on Trust land
Number of tenure rights approved by the Board
1200
1100
-100
Number of land
management projects approved by the Board 5
Effective and efficient asset management services
Land Holding Register maintained on a quarterly basis 4
Provide Human Resources Management
Number of HRM / Legal policies developed / reviewed -5
Support to Traditional Councils in capacity building programs
Number of Traditional Council workshops held on land management issues 43 31
-12
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12. COMMENTS ON PERFORMANCE REPORT
Number of Tenure rights approved by the Board
As at 31 March 2015, there was a shortfall of 100 unsigned leases. These leases were subsequently signed by both parties.
Number of HRM / Legal policies developed / reviewed
The Board has identified relevant policies to be developed in line with the revised APP, the proposed organogram and current business environment.
Number of Traditional Council workshops held on land management issues
Due to limited capacity, one individual was employed to undertake this task , therefore only 31 Traditional Councils were attended to during the period under review. Currently the Real Estate section is also involved in the training of Traditional Councils to fast track this process.
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13. FINANCIAL PERFORMANCE – TRANSFER PAYMENT FUNDING 31/03/15R 
TRANSFER PAYMENT FUNDING
Current payments
Compensation of employees
Goods and services
TOTAL EXPENDITURE FOR THE YEAR ( excluding depreciation)
The total transfer payment funding received for 2014/2015 was utilized for the year.
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14. Summary Statement of Financial Position for the year ended 31 March 2015
2014 / 2015
2013 / 2014
Total Assets
436,750,659
373,181,304
Total Liabilities
308,841,774
262,388,379
Net Assets
127,908,885
110,792,925
Total Net Assets 5.
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15. SUMMARY – STATEMENT OF CONSOLIDATED FINANCIAL PERFORMANCE AS AT 31/03/15
Income
Rental Income
70 785 638
Finance Income
11 357 283
Royalty Revenue
898 581
Other Revenue (including transfer payment)
18 040 268
Total Revenue
101 081 770
Expenditure
83 965 810
SURPLUS FOR THE YEAR
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16. Cash flow Statement for the year
Notes R
2014 / 2015
2013 / 2014
Net cash flow from operating activities 1
10,278,996
13,562,960
Net cash flow from investing activities
(4,673,251)
(6,315,113)
Increase in cash and cash equivalents 2
__5,605,745
_7,247,847
Cash and Cash Equivalents at the end of the year
184,939,560
179,333,815
Notes:-
There was a decrease in cash flow from operating activities due increase in operational expenditure.
The Increase in cash and cash equivalents from 2013 / 2014 amounted to R5,6 m
The decrease in cash flow from investing activities is due to the completion of major construction of office accommodation in the previous year and decrease in vehicle purchases.
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17. Compensation of employees 17 115 352 Goods and services 66 652 458
CONSOLIDATED FINANCIAL PERFORMANCE AS PER ECONOMIC CLASSIFICATION AT 31/03/15 R 
Current payments
Compensation of employees
17 115 352
Goods and services
Rent on land  
Capital Expenditure 4 
TOTAL EXPENDITURE FOR THE YEAR
88 699 061
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18. Operating expenditure trends
Current year
Total expenditure decreased by % mainly due to decrease in the rates provision in 2014/2015.
Compensation of employees increased by 17.18% .
Rental is paid for the only satellite office at Ulundi.
Goods and services includes general operating and administrative expenses (excluding employee cost).
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19. Employee cost to company
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20. Capital expenditure incurred at cost
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21. Capital Expenditure Trends
Current year
Capital expenditure is paid from income generated from trading activities ( not transfer payment)
ITB purchased vehicle, furniture and equipment due to the increase in business activities.
Software development for the database of leases undertaken.
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22. Total Revenue for the year 2014/2015
Note: The Percentage composition of the Total Revenue of R is as follows : -
- Rental Income = 70%
- Other Revenue = 18.% ( including transfer payment)
- Finance Income = 11%
- Royalty Income = 1%
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23. Departmental Transfer Payments
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24. AUDITOR GENERAL’S REPORT ON PERFORMANCE INFORMATION
The Auditor General did not identify any material findings on : The usefulness and reliability of the reported performance information for the unlocking an enabling environment conducive to development on Trust land, effective and efficient asset management services, provide human resource management and support to Traditional Council in capacity building objectives.
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25. Thank You
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