Cost-cutting and Filling of posts
Despite the positive economic outlook, financial pressures in South Africa require tough decisions to maintain fiscal integrity. Circular PT (3) of 2018/19 outlines cost-cutting strategies and challenges faced in event approvals to protect service delivery amidst continuous budget cuts.
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Cost-cutting and Filling of posts KwaZulu-Natal Provincial Treasury 07 June 2018
Circular PT (3) of 2018/19 (1) As per the 2018/19 Budget speech despite the encouraging economic outlook, the country s financial position is still under severe pressure, demanding that we make tough decisions. As stated by the former Minister of Finance last month, Honorable Malusi Gigaba, while tabling the national budget, I quote, The fiscal proposals will cause discomfort, but they are necessary to protect the integrity of the public finances. The cost-cutting measures remain in place. The provincial cost-cutting measures and those issued by National Treasury must continue to be adhered to. Every little saving helps us to protect service delivery spending in these times of continuous budget cuts. To quote an African proverb If you think you are too small to make a difference, you haven t spent a night with a mosquito. IMPLEMENTATION of Circular PT (3) of 2018/19 is therefore important so that we maintain and enhance the fiscal austerity measures that were approved by the PEC (Cabinet) in October 2009 and enhanced/amended over the years. Some depts are slowly slipping back into bad habits and wastage 2
Circular PT (3) of 2018/19 (2) CHALLENGES Events PT approval for ALL costs of events including marquees, catering, security, accommodation, tables/chairs/decorations, transport, etc. PT approval to be sought 5 working days before the event is planned to take place noted that there will be some last minute approvals, but must be the exception. This remains the area of most concern at present depts. are not meeting this deadline!! Now known in PT as #lastminute.com events the only exceptions likely to receive approval for late submission are funerals and emergency meetings/events such as in a Xenophobia outbreak or natural disaster. Proposal as soon as submission begins its movement from author to HOD send a copy to SCM to get quotes don t wait until HOD has approved. Also, HODs and CGOs need to see real (not estimated) costs before signing. Too often submissions are received on time but quotes come either a day before or even after the event. PT will NOT approve the event if quotes are late. 3
Challenges (2) Reiterating that event requests are not reaching PT 5 days or more prior to the day of the event Often no or incomplete quotes are submitted must be 3 quotes for each service/item If accommodation is not being procured centrally (ie. regions or district are booking) then to avoid delays and multiple quotes just cost the total number needing accommodation at R1 400 per night with a proviso that if costs exceed this by more than 10% then the request will be resubmitted Many sources of event requests within depts proposal is that depts. use 1 central controlling point if possible Health use Communications Unit and Soc. Dev. uses SCM Unit PT has designed a checklist of activities for event submissions on the CD for depts. to use/adapt for their own processes and submit with event requests 4
Challenges (3) Many events are annual or listed in the APP yet event requests arrive late evidence of poor planning Question are depts. monitoring that no S&T claims are processed for staff at catered events? 5
International Travel Depts are reminded that ALL costs need to be included for approval in international travel requests flights, taxes, transit costs, accommodation, car hire, S&T, etc. Please also list full cost not cost per day! Para 28 Business class travel only for MECs, HODs, CEOs, Chairs of Board (and MPLs, where applicable). All other officials and board members must fly economy class this is more stringent than NT Instruction 4 of 17/18 and overrides the NT requirements do NOT cite the NT document as motivation for deviating from the above! 6
Conclusion Remember, the economy is only growing marginally this will have a limiting effect on tax revenues and hence on available funding for government spending possibility of further cuts?? and any cuts at dept level are likely to be proportionate to your share of the total provincial budget PT, as part of IYM process, reviews depts inputs with emphasis on those items that should be showing savings if cost-cutting measures are being implemented. These would be areas that would be targeted when implementing budget cuts So cost-cutting is essential to maintain our current levels of service to our people 7
PRESENTATION AT THE KZN PROVINCIAL TREASURY GUIDELINE WORKSHOP PROCESS OF FILLING CRITICAL VACANT POSTS IN THE PROVINCE OF KWAZULU-NATAL KZN OFFICE OF THE PREMIER CHIEF DIRECTORATE: STRATEGIC HUMAN RESOURCE MANAGEMENT Presented by: Date: 7 June 2018
Analysis of submissions Approved as at 4 June 2018 Approved Total No. of Subs No. of contr acts Department / Public Entity No. of Perm posts Total value (perm + contracts) No. of Subs Value of Perm posts Value of contracts Agriculture Agribusiness Development Agency Agribusiness Development Agency & Mjindi (Pty) Ltd Mjindi Farming Arts & Culture COGTA Community Safety & Liaison Economic Development Dube Tradeport Ezemvelo KZN Wildlife Ithala Development Finance Corporation KZN Film Commission KZN Growth Fund KZN Liquor Authority KZN Sharks Board KZN Wildlife Moses Kotane Institute Richards Bay Industrial Development Zone Tourism KZN Trade & Investment KZN 11 2 1 1 13 38 15 13 2 2 3 1 2 1 1 3 1 2 1 1 10 2 1 1 9 31 15 11 2 2 2 1 2 1 1 2 1 2 1 1 254 100,631,434 6 27,937,149 76 6 39 1 12 47 10 4 6 12,505,684 2,981,856 7,515,126 188,181 321,221 14,958,777 1,870,890 520,000 2,503,698 26,047,485 3,377,000 3,045,000 902,285 2,919,241 3,686,285 15,392,179 2,060,097 1,325,000 113,137,118 30,919,005 7,515,126 188,181 52,362,586 71,056,543 28,611,117 71,721,412 12,094,269 26,047,485 6,460,000 4,980,514 6,165,374 4,866,855 6,320,615 41,941,333 4,323,387 12,092,037 5,199,983 6,852,237 127 103 66 137 45 52,041,365 56,097,766 26,740,227 71,201,412 9,590,571 1,106 8 3 7 3 6 3,083,000 1,935,514 5,263,089 1,947,614 2,634,330 26,549,154 1,044 2,263,290 10,767,037 5,199,983 3,400,000 4 4 2 5 7 154 3 3 1 18 5 4 4 3,452,237 9
Analysis of submissions Approved as at 4 June 2018 Approved Total No. of Subs No. of contr acts Department / Public Entity No. of Perm posts Total value (perm + contracts) No. of Subs Value of Perm posts Value of contracts Education Health Human Settlements Office of the Premier Heritage KwaZulu-Natal KZN Gaming & Betting Board Provincial Treasury Public Works Social Development Sport & Recreation Transport Grand Total 31 8 26 19 1 9 12 9 4 5 48 286 18 4 25 18 95 3 111 137 52,748,721 2,575,824 24,105,738 55,802,715 22 82 65 23 7,164,210 28,562,250 36,802,717 4,170,178 59,912,931 31,138,074 60,908,455 59,972,893 0 8 16 121 184 310 107,041,764 33 17,574,303 272 105,159,480 2,231 923,761,873 2,880 358,419,443 1,282,181,315 6,326,692 67,527,569 77,616,132 6,326,692 120,984,249 78,879,262 107,041,764 18,703,303 225,458,516 12 6 3 3 32 227 98 6 53,456,680 1,263,130 6 1,129,000 197 120,299,036 10
Analysis of submissions Returned / Not Approved as at 4 June 2018 Returned to Department / Not Approved Total No. of Subs No. of contr acts Department / Public Entity No. of Perm posts Total value (perm + contracts) No. of Subs Value of Perm posts Value of contracts Agriculture Agribusiness Development Agency Agribusiness Development Agency & Mjindi (Pty) Ltd Mjindi Farming Arts & Culture COGTA Community Safety & Liaison Economic Development Dube Tradeport Ezemvelo KZN Wildlife Ithala Development Finance Corporation KZN Film Commission KZN Growth Fund KZN Liquor Authority KZN Sharks Board KZN Wildlife Moses Kotane Institute Richards Bay Industrial Development Zone Tourism KZN Trade & Investment KZN 11 2 1 1 13 38 15 13 2 2 3 1 2 1 1 3 1 2 1 1 1 17 15,047,655 15,047,655 0 0 0 2 4 60 22 41,217,856 12,809,061 41,217,856 13,991,676 4 1,182,615 0 1 0 0 2 150,000 150,000 0 0 0 0 0 0 0 1 179 38,590,241 38,590,241 0 0 0 0 11
Analysis of submissions Returned / Not Approved as at 4 June 2018 Returned to Department / Not Approved Total No. of Subs No. of contr acts Department / Public Entity No. of Perm posts Total value (perm + contracts) No. of Subs Value of Perm posts Value of contracts Education Health Human Settlements Office of the Premier Heritage KwaZulu-Natal KZN Gaming & Betting Board Provincial Treasury Public Works Social Development Sport & Recreation Transport Grand Total 31 8 26 19 1 9 12 9 4 5 48 286 13 4 1 1 877 215,791,081 3 2,121,726 9 1,270,119 217,061,200 66 4,297,713 6 1,134,648 6,419,439 1,134,648 35,727,852 62 35,727,852 0 1 2 500,000 500,000 0 1 1 2 219 66 32 71,151,089 41,071,187 21,110,558 71,151,089 41,071,187 22,078,696 13 13 1,490,040 395,363,549 113 10,493,273 899,505,088 968,138 14 47 1,691 393,873,509 3,230 889,011,815 12
Analysis of submissions still going through the process as at 4 June 2018 In Process (with Public Finance/MEC for Finance/Premier) Total No. of Subs No. of contr acts Total value (perm + contracts) Department / Public Entity No. of Perm posts Value of Perm posts No. of Subs Value of contracts Agriculture Agribusiness Development Agency Agribusiness Development Agency & Mjindi (Pty) Ltd Mjindi Farming Arts & Culture COGTA Community Safety & Liaison Economic Development Dube Tradeport Ezemvelo KZN Wildlife Ithala Development Finance Corporation KZN Film Commission KZN Growth Fund KZN Liquor Authority KZN Sharks Board KZN Wildlife Moses Kotane Institute Richards Bay Industrial Development Zone Tourism KZN Trade & Investment KZN 11 2 1 1 13 38 15 13 2 2 3 1 2 1 1 3 1 2 1 1 2 3 34 5,292,525 10 1,823,616 5,292,525 4 255,702 2,079,318 1 3 1,351,965 1,351,965 1 4 1,159,704 1,159,704 13
Analysis of submissions still going through the process as at 4 June 2018 In Process (with Public Finance/MEC for Finance/Premier) Total No. of Subs No. of contr acts Total value (perm + contracts) Department / Public Entity No. of Perm posts Value of Perm posts No. of Subs Value of contracts Education Health Human Settlements Office of the Premier Heritage KwaZulu-Natal KZN Gaming & Betting Board Provincial Treasury Public Works Social Development Sport & Recreation Transport Grand Total 31 8 26 19 1 9 12 9 4 5 48 286 1 11 1,977,432 1,977,432 2 4 2,358,235 2,358,235 0 0 2 8 549,639 549,639 12 62 11,605,242 16 3,163,576 14,768,818 14
Analysis of time taken to process submissions as at 4 June 2018 15
Average days to process for Office of the Premier and Provincial Treasury as at 4 June 2018 16
Impact of the intervention It is evident from the statistics that the intervention is having an impact in that the number of employees in the Province is no longer increasing annually, it is decreasing. 20
Points to note PT does not submit a request to OTP if funding is an issue Funding analysis for filling of posts Projected actual 2018/19 EPRE 2017/18 (Dec 2017) 2017/18 (Unaudited) 2018/19 2019/20 2020/21 R'000 Example 1 COE baseline Percentage growth 215 215 234 8.8 250 6.8 275 10.0 Example 2 COE baseline Percentage growth 279 278 323 16.2 337 4.3 363 7.7 Example 3 COE baseline Percentage growth 24 778 24 615 26 179 28 191 30 565 6.4 7.7 8.4 21
Points to note Revised organograms note that PT will not approve any funding for expanded organograms if a PT certificate is needed for DPSA then it can be given but without funding which means depts. will only be able to fill new posts when funding is reprioritised . If approval for a post was given more than 1 year ago and the post is still not filled then this post needs a new approval process this is a proposal to be sent to COHOD for approval!! Some depts. are requesting approval for contract appointments while recruitment processes are underway this is OK but PT will not extend these contracts unless there are extenuating circumstances recently refused extension when a dept took more than 8 months from approval of post/contract to interview stage please ensure recruitment process moves quickly!! 22
Points to note Contracts are dangerous recent cases show continual extension of contract can result in depts. being forced to appoint incumbents as permanents labour law supports the employee in this regard!! Please consider batching or grouping requests for the unfreezing of posts either monthly or quarterly. PT gets inundated with single requests which slows down the process There is not really a moratorium on filling posts appointments are possible if post is critical and FUNDED!! 23
THE END QUESTIONS / COMMENTS 24
Thank you 25
