1 / 21

Background on EPWP

EPWP INCENTIVE GRANT MODEL REVIEW PROPOSAL PRESENTATION TO SELECT COMMITTEE ON APPROPRIATIONS 11 OCTOBER 2011. Background on EPWP. SA was experiencing unacceptable levels of structural unemployment, worsened by global economic crisis

xanthus-adkins
Download Presentation

Background on EPWP

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. EPWPINCENTIVE GRANT MODEL REVIEW PROPOSAL PRESENTATION TO SELECT COMMITTEE ON APPROPRIATIONS11 OCTOBER 2011

  2. Background on EPWP • SA was experiencing unacceptable levels of structural unemployment, worsened by global economic crisis • EPWP was seen as an opportunity to address the social welfare gap • EPWP would enable government to act as an employer of last resort as part of the Anti-Poverty Strategy • However, the scale and impact of EPWP Phase I was limited • Key Issues identified as affecting impact in Phase I: • Duration of work opportunities were shorter than anticipated • Training framework was not effective • Need for more focused targeting • Key Issues identified as impeding EPWP growth: • DPW had very limited authority to drive the programme • No effective mechanism to mobilise funds to scale up performing areas • Need to switch the programme to a demand driven approach • Need for uniform wage structures

  3. Background on EPWP • Key Issues identified as impeding EPWP growth continued…: • Need to increase the labour intensity of projects without an excessive long term fiscal burden • Need for capacity support for implementing bodies • As a result, the following changes were made in EPWP Phase II: • Make the creation of paid work the primary objective of EPWP • Locate clear political and administrative accountability for EPWP job creation targets across all spheres of government • Provide fiscal incentives to accelerate the scaling up of EPWP (allow incentive to be performance/demand driven) • Mainstream EPWP criteria & outputs with the core mandates and programmes of implementing public bodies • Mobilise non-state capacity to deliver additional EPWP work opportunities • Technical Support to spheres, sectors and implementing bodies

  4. Background on EPWP Incentives Public Works set out to pilot a number of funding models:

  5. Introduction to the Integrated Incentive Grant • Aim: The original intention of the EPWP Incentive Grant was to increase job creation efforts by provinces and municipalities by providing a financial performance reward. The incentive grant was premised on the assumption that a financial reward would motivate provinces and municipalities to create more EPWP work primarily by shifting towards more labour intensive methods of construction. • Assumption: Government was investing large amounts of public funds into infrastructure; and government wanted to maximise this existing investment for the purposes of job creation; incentivising public bodies to implement infrastructure projects more effectively, efficiently and labour intensively. • For the incentive to work as intended, the following pre-conditions are necessary: • Agreed, dedicated focus and political will to mobilise job creation • Concerted effort to shift current project design/ implementation methodology towards labour intensive construction methods • Implement more projects (and thus create more jobs) • Accurately report performance. Key issue

  6. Performance on the Incentive: past 2 years • The number of public bodies eligible has almost doubled each year • Provinces - from 17 (2009/10) to 32 (2010/11) to 59 (2011/12) • Municipalities – from 68 (2009/10) to 126 (2010/11) to 198 (2011/12) showing tremendous progress in public bodies understanding how to access the incentive grant • In 2009/10 only 3 provinces accessed the Incentive Grant (KZN, EC, WC) but in 2010/11 only 2 provinces did not access their Incentive Grant allocations (NC, NW) • KZN & EC lead provincial performance • 13 municipalities with an incentive allocation did not report in 2009/10 and 12 in 2010/11 • Gauteng municipalities account for almost half of municipal performance • There is still a clear need for dedicated technical capacity to support project design and implementation as well as reporting.

  7. Provincial Performance on the Incentive: past 2 years

  8. Provincial Performance on the Incentive: past 2 years (Cont.)

  9. Municipal Performance on the Incentive: past 2 years

  10. Municipal Performance on the Incentive: past 2 years (Cont.)

  11. Experience in implementing all EPWP Incentives

  12. Evaluation of the Incentive: past 2 years • The evaluation of the Incentive showed that public bodies are still struggling: • Firstly, just to implement their infrastructure programmes/ projects (Are there constraints inherent in the way MIG/IGP works? What are the MIG/IGP implementation challenges?) • Secondly, to design and implement these programmes/ projects more labour intensively (there is a real lack of technical expertise) • In terms of technical project design and implementation, the evaluation report showed that: • Many public bodies are indicating that they still find designing projects with labour intensive methods as an aim, a challenge • There are still perceptions that it is costly to implement EPWP • Public bodies find it difficult to integrate and align EPWP with other infrastructure policies and processes • A more serious challenge highlighted relates to the lack of technical capacity in municipalities to implement infrastructure projects • Public bodies indicated they would benefit from additional technical support from National Public Works in the following areas: • Identifying suitable projects for EPWP • Setting targets for projects • Assistance with designs and contract documentation to ensure labour intensive construction • Ensuring EPWP mainstreaming: policies and procedures • Providing advice on alternative models on EPWP: large projects /contractor development. • Thirdly, to then properly report this performance (in the detailed manner required).

  13. Evaluation of the Incentive: past 2 years

  14. Measures put in place in 2010/11 to improve the drawing down of the incentive • DPW Support to public bodies has been strengthened • The capacity of DPW’s Municipal Technical Support Directorate has been strengthened by the appointment of more officials to support municipalities • Technical support is still being provided to public bodies to implement their projects more labour intensively • Public bodies are being provided with support to report on EPWP - 90 data have been deployed in public bodies capturers employed are helping in this regard. • Partnership Support • A partnership with DBSA through the Siyenza Manje programme has been put in place to support municipalities • Training of officials in municipalities in labour-intensive methods of construction with LG-SETA is currently being rolled out • Training through the Construction SETA for municipal officials and Vukupile through the small contractor development programme

  15. Technical Support provided to Municipalities • Technical Support provided to Municipalities entails the following: • Identification of suitable projects • Setting of work opportunity targets for projects • Assisting with designs and contract documentation • Extract project training needs • Assist with procurement process • Create enabling conditions: wage rates, contractors • trained et • Contract management • Reporting • Project evaluation • EPWP Mainstreaming: Municipal policies and procedures 15

  16. Proposed Revisions to Improve the Incentive Model • In order to improve the uptake of the incentive, a review of the incentive model is proposed. The revised model should: • Take special cognisance of small and rural municipalities and other public bodies with smaller MIG/IGP allocations or limited funding, but potential to contribute to job creation • Attempt to directly incentivise/implement increased labour intensity • Allow for an easier flow of funds to kick start job creation • Provide more certainty in the allocation to ease appropriation issues • Address the issue of public bodies not earning their allocations • Seek to have a greater oversight in the incentive being spent to further increase job creation • Enhance ‘packaged’ technical support to public bodies, particularly small and rural municipalities • In a snapshot: • Public bodies will receive an allocation based primarily on past performance but also taking into consideration the distribution of the poor and a special dispensation for poor municipalities in the form of a schedule 5 EPWP grant • for which they need to plan labour intensive projects to implement, within the focus areas specified • while using existing budget allocations (MIG, etc) more effectively and efficiently to increase the access to further EPWP grant allocations.

  17. Conceptual basis of the Improved Incentive Model

  18. Conceptual basis of the Improved Incentive Model

  19. Conceptual basis of the Improved Incentive Model

  20. Summary of proposed review to the Incentive • The proposal to the EPWP Integrated incentive is to change • the incentive from a Schedule 8 to a schedule 5 grant. This • will help with predictability of funding to Public bodies. • The eligibility of Public bodies for the incentive grant will still • depend on them having reporting to the National Department • of Public Works in a Prior financial year. • The incentive allocation to Public bodies will depend on their • report in the prior financial year. 50% of the allocation would • be made at the beginning of the financial year. The • remaining 50% will be made depending reporting by the • Public bodies. • Public bodies would submit their business plans in line with • their incentive allocation. • Technical Support would be made to Municipalities to • implement EPWP. Focus would be given to rural • municipalities. 20

  21. THANK YOU!

More Related