PRESENTATION BY THE DEPARTMENT OF LABOUR TO THE SELECT COMMITTEE ON LABOUR AND PUBLIC ENTERPRISES

1. PRESENTATION BY THE DEPARTMENT OF LABOUR TO THE SELECT COMMITTEE ON LABOUR AND PUBLIC ENTERPRISES Annual Report 2011/12 31 OCTOBER 2012

2. TABLE OF CONTENTS • MANDATE • MEDIUM TERM STRATEGIC FRAMEWORK (MTSF) AND SERVICE DELIVERY OUTCOMES ALIGNED TO THE DOL STRATEGIC OBJECTIVES • KEY ASPECTS OF THE DOL STRATEGIC PLAN 2011/12, TARGETS AND PERFORMANCE • BUDGET ALLOCATIONS AND UTILISATION INCLUDING AUDIT FINDINGS • SHELTERED EMPLOYMENT FACTORIES • MANAGEMENT ACTION TO RESPOND TO AUDIT MATTERS • HUMAN RESOURCES

3. 1. Mandate Vision The Department of Labour will strive for a labour market which is conducive to investment, economic growth, employment creation and Decent Work. Mission Regulate the South African labour market for a sustainable economy through: • Appropriate legislation and regulations • Inspection, compliance monitoring and enforcement • Protection of human rights • Provision of Employment Services • Promoting equity • Social and income protection • Social dialogue.

4. 2. MTSF and Service Delivery Outcome aligned to the Department of Labour’s strategic objectives In this report, the Department reflects on its contribution to year three of the Medium-Term Strategic Framework (MTSF) 2009-2014 with a focus on the following Government service delivery outcomes: Outcome 4: Decent employment through inclusive economic growth, and two other outcomes; Outcome 11. Create a better South Africa and contribute to a better and safer Africa and World; and Outcome 12: An efficient, effective and development orientated public service and an empowered and inclusive citizenship.

5. 2. MTSF and Service Delivery Outcome aligned to the Department of Labour’s strategic objectives - continues

6. 2. MTSF and Service Delivery Outcome aligned to the Department of Labour’s strategic objectives - continues • To achieve these objectives, the Department, in the 2011/12 financial year focused on the following strategic programmes • Labour law amendments. • Rebuilding the Public Employment Services. • Implementation of Decent Work Country Programme. • Strengthening of Department of Labour inspectorate. • Reduce inequality and discrimination in the labour market through effective compliance monitoring and enforcement of the Employment Equity Act. • Improved access to income protection services (CF and UIF) including reintegration of workers into the labour market.

7. Branches/Programmes within the Department of Labour Programme 1: Administration (ADMIN) Programme 2: Inspections and Enforcement Services (IES) Programme 3: Public Employment Services (PES) Programme 4: Labour Policy and Industrial Relations (LP and IR)

8. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance

9. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

10. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

11. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

12. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

13. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

14. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

15. 3. Key Aspects of the Department of Labour’s Strategic Plan 2011/12 - Targets and Performance

16. 3. Key Aspects of the Department of Labour’s Strategic Plan 2011/12 - Targets and Performance

17. 3. Key Aspects of the Department of Labour’s Strategic Plan 2011/12 - Targets and Performance NB: Other work-seekers were provided with counselling & employment enhancement and other DoL services

18. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

19. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

20. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

21. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

22. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

23. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

24. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

25. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

26. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

27. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

28. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

29. 3. Key Aspects of the DoL Strategic Plan 2011/12, Targets and Performance - continues

30. 4. Budget Allocations and Utilisation per Main Division of the Vote

31. 4. Budget Allocations and Utilisation per Main Division of the Vote

32. 4. AUDIT FINDINGS – 2011/12

33. 4. AUDIT FINDINGS – 2011/12

34. 5. SEF SHELTERED EMPLOYMENT FACTORIES (SEF)

35. 5.1 Background History of The SEF • The Sheltered Employment Factories (SEF) were established more than 65 years ago to provide employment opportunities for those handicapped people who were unable to hold down employment in the open labour market due to the nature of their afflictions. There are more than 2.5 million handicapped people in South Africa of whom some 10% to 15% probably require an environment such as the Sheltered Employment Factories provide. Currently around 97% of the workers in our factories fit this profile. This is not merely a haven for the unemployed, but for those who cannot compete – often the emotionally / psychologically challenged. • The Department of Labour inherited the SEF from the previous Government and has in the recent past taken a bold step of embarking on a turnaround strategy, that is aimed at converting the SEF into entities that: - have a clear and definable legal status - operate as efficient entities - serve to advance government’s national agenda on active participation in the economy of the country by people with disabilities.

36. 5.1 Background History of SEF - continues • The SEF now has 12 factories across South Africa operating in 7 of the 9 provinces, with only Mpumalanga and Limpopo without a facility. Factories are located in Bloemfontein, Cape Town, Durban, East London, Johannesburg, Kimberly, Pietermaritzburg, Port Elizabeth, Potchefstroom and Pretoria. Collectively they employ some 1 100 disabled people supported by 120 administration, management and technical staff. With current premises – land, buildings and equipment - there is the potential to provide meaningful work opportunities for more than 3 000 handicapped people. In time it is envisaged that these numbers will increase significantly as an awareness of the SEF and its purpose is created in South Africa and the potential market for products is addressed.

37. 5.2 Business Case • The Business Case is aimed at developing a turnaround strategy that will help the Sheltered Employment Factories to transform into legal entities that sustain themselves and increase employment opportunities for people with disabilities who cannot secure employment in the open labour market due to the nature of their afflictions. Progress to date • The Employment Services Bill currently referred to parliament, makes reference of SEF’s legal framework in Chapter 6 and deals with the establishment of the SEF as Protected Employment Enterprise (PEE). • Three reports have been produced by the appointed service provider and adopted by the Department, the reports are namely; Situational Analysis • Which looks at the current situation at the SEF and the environment in which the factories operate.

38. 5.2 Business Case - continues SEF Options Models • This presents an range of options that the SEF has to consider in order to transform itself into viable entities; and Implementation Plan • This is a detailed plan on the implementation of the agreed option(s) with time frames and milestones over the MTEF period. • A detailed SEF budget bid was prepared and submitted to the National Treasury for consideration based on the Implementation plan recommendations.

39. 5.3 Employment Equity • SEF’s financial situation has led to a decrease in the number of people with disabilities employed by SEF from 3 000 to 926 and consequently SEF’ s ability to change the profile of their employees to be representative of South African society. • SEF employs (1 063: 2008) 926 people with disabilities which constitutes 0.04% of the total South African population of people with disabilities • SEF employees (67%: 2008) 60% White compared to the general population of people with disabilities which is 82% African • SEF employees are (82%: 2008) 72% male compared to the general population of people with disabilities which is 52% Female

40. 5.3 Employment Equity - continues • SEF race and gender profile exhibits racial and gender disparities. Reductions in work and the moratorium on recruitment SEF has impacted on the opportunity to redress these inequities. However, the change in statistics from 2008 demonstrates commitment to redressing equity balances. • Management profile is 50% White, 29% African, 18% Coloured and 3% Asian of which 47% is male and 43% is female. • Factory worker’s profile is of 62% White, 15% African, 22% Coloured and 1% Asian of which 76% is male and 26% female. • The overall SEF profile is 60% White, 22% Coloured, 17% African and 1% Asian of which 72% is male and 28% is female. • The SEF age profile exhibits an aging population with very little feed (6%) into the new generation and many employees (39%) older than 50 years..

41. 5.4 Production Facility The SEF is complemented by these factories across the landscape of the country as follows:

42. 5.5 Key Aspects of the SEF Strategic Plan 2011/12, Targets and Performance

43. 5.5 Key Aspects of the SEF Strategic Plan 2011/12, Targets and Performance - continues

44. 5.5 Key Aspects of the SEF Strategic Plan 2011/12, Targets and Performance - continues

45. 5.6 FINANCIAL MANAGEMENT OF SEF

46. 5.6 AUDIT MATTERS OF SEF

47. 5.6 AUDIT MATTERS OF SEF

48. 6. MANAGEMENT ACTION TO RESPOND TO AUDIT

49. 7. HUMAN RESOURCES – The DoL’s Staff compliment

50. 7. HUMAN RESOURCES – Employment status