presentation to parliament on the annual performance and five year strategic plan 15 april 2015 by...

Presentation to Parliament on the Annual Performance and Five Year Strategic Plan

15 April 2015

By Khathu RamukumbaChief Executive Officer

2

Table of Contents

Contents

1 NYDA Annual Performance Plan

2 Budget 2015 / 2016

3 Loan book

4 Audit matters

5 Organisational redevelopment and culture change

NYDA ANNUAL PERFORMANCE PLAN

2015/2016

3

Strategic Outcomes

Strategic Outcome Area 1:Improved and sustainable livelihood opportunities for young people in South Africa.

Strategic outcome area 2: Enhanced participation of young people in social cohesion towards nation building

Strategic Outcome 3: Enhanced enabling environment that promotes youth development in all sectors of South African Society

Strategic Outcome Area 4: Develop and enhance a credible and capable youth development agency

4

KPA 1: ECONOMIC PARTICIPATIONStrategic Outcome: Improved and sustainable livelihood opportunities for young people inSouth Africa.

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Strategic Objectives

Performance Indicator

Actual Performance

Estimated Performance

Medium Term Targets

2014/15 2015/16 2016/17 2017/18 2018/19

To enhance the participation of young people in the economy

Number of youth owned enterprises and youth receiving NYDA grant funding

500 youth owned enterprises and youth





Number of young aspiring and established entrepreneurs supported through NYDA Business Development Support service

38,475 young aspiring and established entrepreneurs





Number of communities provided with community development facilitation support

16 communities 66 communities 73 communities

80 communities

88 communities

Number of jobs created and sustained through grant funding,corporatives and business development services

2,750 jobs created and sustained





KPA 2: EDUCATION & SKILLS DEVELOPMENT

6

Strategic Outcome: Improved and sustainable livelihood opportunities for youngpeople in South Africa.



Actual Performance


Medium Term Targets

2014/15 2015/16 2016/17 2017/18 2018/19

To facilitate and implement education opportunities in order to improve the quality education attainment for the youth

Number of young people enrolled in the NYDA Matric (Grade12) re-write programme

3,500 young people

3,675 young people

4,043 young people

4,447 young people

4,891 young people

Number of youth supported through the scholarship programme (Solomon Mahlangu Scholarship Programme)

143 youth 400 youth 440 youth 484 youth 532 youth

Number of young people supported through individual and group career guidance interventions

770,000 young people




1,076,114 young people

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KPA 2: EDUCATION & SKILLS DEVELOPMENT (continued)



Actual Performance


Medium Term Targets

2014/15 2015/16 2016/17 2017/18 2018/19

To facilitate and implement skills programmes

Number of young people participating in structured YouthBuild programmes

1,650 young people

2,000 young people

2,200 young people

2,420 young people

2,662 young people

Number of young people enrolled in NYS volunteer programmes

10,000 young people

12,000 young people

13,200 young people

14,520 young people

15,972 young people

Number of young people supported through life skills programme, the job preparedness programme and job placement programme.

New Indicator 55 650 young people

61 205 young people

67 325 young people

74 058 young people

KPA 3: HEALTH AND WELL-BEING

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Strategic Outcome: Enhanced participation of young people in social cohesion towards nation building



Actual Performance


Medium Term Targets

2014/15 2015/16 2016/17 2017/18 2018/19

To facilitate access to health and well-being programmes

Number of young people accessing programmes and intervention designed to improve health and well-being

5,500 young people

5,775 young people

6,353 young people

6,988 young people

7,687 young people

To provide health and well- being interventions to young people

Number of youth participating in campaigns and special projects implemented

New Indicator 200 000 youth

210 000 youth

220 000 youth

230 000 youth

KPA 4: POLICY AND RESEARCH

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Strategic Outcome: Enhanced enabling environment that promotes youth development in all sectors of South African Society



Actual Performance


Medium Term Targets

2014/15 2015/16 2016/17 2017/18 2018/19

To create and produce information and knowledge for better youth development planning and decision making

Number of youth development research and evaluations products and policy reviews/developments produced by the NYDA

New Indicator 44 youth development research and evaluations products and policy reviews/developments produced by the NYDA

48 youth development research and evaluations products and policy reviews/developments produced by the NYDA



Develop National Youth Employment Plan 2030

Submission of draft [National Youth Employment Plan 2030] developed and approved by NYDA board

Final National Youth Employment Plan 2030 approved by the NYDA and submitted to the Presidency

Final National Youth Employment Plan 2030 endorsed

N/A N/A

KPA 4: POLICY AND RESEARCH (continued)

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Actual Performance


Medium Term Targets

2014/15 2015/16 2016/17 2017/18 2018/19

To provide access to information and create awareness on youth development programmes

Number of young people receiving information on youth development through NYDA access points


1,200 000 young people

1,320 ,000 young people



To Lobby Key Stakeholders to support and implement youth development programmes

Number of organs of state and private sector companies lobbied resulting in the establishment of youth directorates and implementation of youth programmes

39 organs of state and private sector companies lobbied resulting in the establishment of youth directorates and implementation of youth programmes





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Actual Performance


Medium Term Targets

2014/15 2015/16 2016/17 2017/18 2018/19

To create a platform for youth to participate and benefit from democratic processes

Number of youth participating in youth development related dialogue sessions

New Indicator 10,800 young people

11,340 young people

11,907 young people

12,502 young people

To mobilise and leverage financial resources from 3rd parties

Value of funds committed to support youth development programmes

R86 million R90 million R99 million R104 million R119 million

KPA 4: POLICY AND RESEARCH (continued)

KPA 5: GOVERNANCE

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Actual Performance


Medium Term Targets

2014/15 2015/16 2016/17 2017/18 2018/19

To establish a credible, efficient and effective organisation

Efficient and effective IT systems to support youth development

Implementation of Phase 1 and Phase 2 of the roadmap

- Review NYDA IT Systems Architecture and Roadmap Implementation

- Implementation of Phase 3 of the roadmap

-Implementation of Phase 4 of the roadmap- Evaluation of the roadmap implementation

N/A N/A

Review of identified policies and processes for increased efficiency

Implementation of Phase 2 roadmap

Evaluation of roadmap implementation

N/A N/A N/A

Number of staff who received training and capacity building to enhance staff performance

350 employees trained





Strategic Outcome: Develop and enhance a credible and capable youth development agency

KPA 5: GOVERNANCE (continued)

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Actual Performance


Medium Term Targets

2014/15 2015/16 2016/17 2017/18 2018/19

To establish a credible, efficient and effective organisation

Number of information dissemination access points operationalised

20 dissemination access points operationalised




44 information dissemination access points operationalised

Compliance to policies and legislations for good governance

Dashboard reports as prepared by internal audit have acceptable levels of compliance to policies and legislation





KEY PRIORITY AREAS 2015 / 2016

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Strengthening

Partnerships

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BUDGET 2015/2016 & OTHER FINANCIAL MATTERS

Methodology

Divisions were required to prepare a zero based budget to determine a costing perproduct in order to deliver targets in respect of the Annual Performance Plan.Unavoidable (sunk) costs were accounted for within the operational divisions.

Consultations occurred with divisional heads on draft budgets which wereinterrogated and whittled down where necessary.The Chief Financial Officer made subsequent adjustments based on analysis ofinformation and comparison to baselines.

The salary budget was developed based on the current headcount plus vacancies. Projected revenue of the organisation was determined and expenditure wasconsolidated and matched against such revenue.

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Considerations• The funding of the business operations of the Agency which require the running costs

of a fully-fledged head office in the hub of South Africa’s economic capital as well as that of fourteen full service level branches to be serviced in order to deliver services to young people and are simply unavoidable costs.

• The salary costs of the Agency which are viewed from the perspective of also being an unavoidable cost albeit a necessary one in order to meet service delivery expectations.

• Each Key Performance Indicator of the organisation is required to be funded with an adequate budget to meet the minimum performance target. To under capacitate targets would be to set the organisation up for failure and immediately place at risk the target achievement that the Agency sets at one hundred percent for each financial year.

• The capital investment required mainly to replace aging infrastructure in the Information Technology space and to create new innovative solutions for service delivery and keep up with current market trends. The investment in employee wellness and learning and development as well as staff recognition.

• The implementation of the turnaround strategy of the organisation requires certain priority investments to be made which would also require funding to be made available.

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Market Conditions

• The most concerning backdrop on the 2015 / 2016 budget is the reduction of the NYDA’s allocation from the National Treasury from an amount initially allocated of R422 million to that imposed by the midterm budget review cuts of R409 million.

• This is part of wider austerity measures imposed across government to reduce the budget deficit and the deficit on the country’s current account.

• Economic growth in the country remains painfully stagnant at around 1,7% due to market conditions prevailing worldwide while unemployment in the country also stubbornly remains at around 25%.

• A positive exists in terms of the falling oil price which has allowed inflation to be reduced to 4,9% in most recent estimates which should influence the overall price of goods and services

• The budget is presented as a consolidated budget of the NYDA while then containing further reference to each division of the NYDA and then down to a third layer which incorporates the detail of projects, operations and branches.

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Income Budget

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Income description Allocation

National Treasury grant R 409 789 000

Rollover of funding R 5 500 000

Loan collection (interest and capital) R 8 500 000

Interest income R 3 500 000

Total R 427 289 000

National Treasury Allocation

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Year Commitment Allocation Percentage change

2010/2011 R 369 973 000 R 369 973 000

2011/2012 R 385 853 000 R 385 853 000 4,29%

2012/2013 R 405 146 000 R 376 010 000 -2,55%

2013/2014 R 396 677 000 R 392 710 000 4,44%

2014/2015 R 408 237 000 R 408 237 000 3,95%

2015 / 2016 R422 565 000 R409 789 000 0,38%

2016 / 2017 R444 931 000 R405 766 000 -0,98%

Donor Funded Income

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Donor funderContribution to Key

Programme Area Amount contributedDepartment of Public Works Expanded Public Works Programme

Education and skills development R10 000 000

National Skills Fund – Solomon Mahlangu Scholarship Fund


Industrial Development Corporation – Voucher Programme

Economic Participation R10 000 000

ETDP-SETA – Second Chance Matric Rewrite


Total projected donor funded income

R32 500 000

Expenditure Budget

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Key Programme Area (including employee costs)

Allocation Percentage Allocation

Economic Development R 72 196 184 16,9%National Youth Service, Education and Skills Development R 87 281 463 20,4%Research and Policy including youth dialogues R 46 183 573 10,8%

Service Delivery Channel R 99 286 497 23,2%

Operational costs R 122 341 283 28,6%

Total R 427 289 000

Expenditure trends

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Description 2012 / 2013

Audited

2013 / 2014Audited

2014 / 2015Projected

Income 412 645 409 754 415 237

MTEF allocation 385 483 392 710 408 237

Other income 27 162 17 044 7 000

Expenditure 425 030 416 875 415 237

Employee costs 162 258 168 456 170 419

Administration(Operational expenditure)

97 175 78 523 70 452

Goods / Services(Youth development projects)

159 913 165 891 169 266

Capital expenditure 5 684 4 005 5 100

Percentage of budget spent

103% 102% 100%

MTEF Allocation

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Description MTEF Projected2014 /15

(000’)

MTEF Budget2015 / 16

(000’)

MTEF Budget 2016 /17

(000’)

Income 415 237 427 289 425 766

MTEF allocation 408 237 409 789 405 766

Other income 7 000 17 500 20 000

Expenditure 415 237 427 289 425 766

Employee costs 170 419 185 719* 196 862*

Administration(Operational expenditure)

70 452 75 671 72 500

Goods / Services(Youth development projects)

169 266 165 899 154 904

Capital expenditure 5 100 5 000 1 500

*Dependent on the outcome of the organisational redevelopment process

MTEF Allocation against Key Programme Area

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Description MTEF Actual 2014 /15

MTEF Budget2015 / 16

MTEF Budget 2016 /17

Economic Participation 53 910 53 799 55 413

Education and Skills 64 560 62 236 64 103

Policy and Research 28 086 17 372 1 921

Service Delivery Channel 23 710 32 492 33 467

Operational, employee & capital expenditure

245 971 261 390* 270 862*

Total 415 237 427 289 425 766

*Dependent on the outcome of the organisational redevelopment process

LOAN BOOK

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Loan Book Considerations

NYDA has two main issues related to its loan book:

•Not taking effective steps to collect all revenue due;•Significant impairment on loan book

NYDA has four point plan on which to close the chapter of the loan book.

Analysis of the loan book:

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Description Amount

Gross advances R385 246 000

Interest receivable R83 102 000

Loans written off (R6 143 000)

Capital repayments R229 925 000

Amount of loan book R232 280 000

Allowance for impairment (R225 618 000)

Net value of loan book R6 662 000

Capital repayment recovered 60%

Loan Book Four Phase Plan

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In progress:

Aimed completion date: 31 May 2015

In progress:

Aimed completion date: 31 May 2015

In progress:

Aimed completion date: 30 June 2015

In progress:

Aimed completion date: 30 June 2015

In progress:

Aimed completion date: 31 July 2015

In progress:

Aimed completion date: 31 July 2015

In progress:

Aimed completion date: 31 March 2016

In progress:

Aimed completion date: 31 March 2016

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AUDIT MATTERS

2010 / 2011 2011 / 2012 2012 / 2013 2013 /2014

6 2 1 1

1. Material impairments in the financial statements on loans receivable




2. Irregular expenditure of R67m

2. Irregular expenditure of R133m

*

3. Significant uncertainties in the financial statements

4. Restatement of prior period figures

5. Fruitless and Wasteful Expenditure of R2m

6. Borrowings without National Treasury approval

*Irregular expenditure was not an emphasis of matter paragraph but amounted to R62m

Emphasis of Matter Paragraphs

Irregular Expenditure

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Year 2010 / 2011 2011 / 2012 2012 / 2013 2013 /2014 2014 / 2015

Amount of irregular

expenditure

R67 000 000 R133 000 000 R62 000 000 R16 000 000 R559 558

Percentage change

99% -53% -74% -97%

The Auditor General recommended that the NYDA take steps to prevent irregular expenditure

and take appropriate action against officials for incurring irregular expenditure.

The NYDA has taken the following corrective actions:

• Disciplinary action taken against staff who have incurred irregular expenditure

• Supply Chain Management (SCM) turnaround strategy implemented and monitored on an

ongoing basis by the CEO’s office

• SCM policies and procedures have been reviewed and updated with respect to changes in

legislation

• Training provided to SCM staff and individuals responsible for procurement

• All Bid Committee members are being trained on SCM regulations

• Irregular and fruitless and wasteful expenditure target for 2016 is zero

• Clause in all executive management contracts which relates directly to irregular

expenditure

• SCM charters, policies and procedures updated and approved by accounting authority and

currently implemented across Agency

Corrective actions on Supply Chain Management

Corrective Action on Performance Information

• Monitoring and evaluation framework approved and implemented.• Executive Management contracts all have clauses in respect of ensuring set deadlines are met.• Standardisation of the verification process.• Coordination in terms of branch and head office reporting. • Using the power of IT to unlock potential of enhancing reporting timeframes.

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ORGANISATIONAL REDEVELOPMENT AND CULTURE CHANGE

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Rationale for realigning NYDA’s organisational structure

1. Realignment and refocus to key legislative and regulatory documents, such as the; NYDA Act, National Youth Policy, New Growth Path, National Youth Service Framework etc.

2. Ensure effective achievement of the Strategic 5 year plan and the respective Annual Performance Plan (APP).

3. Efficiently realise the objectives of the Turnaround Strategy so as to ensure impact, credibility and build capacity.

4. Manage the organisation’s high salary bill and refocus the budget on delivering quality service.

5. Reduction of duplication of work at Head office and the branches. 6. Ensure clear integration of all products and services offered by the

NYDA.7. Focus on continuous and innovative product and programme

enhancement that speaks to the dynamic needs of the youth.8. Promote cross functionality across the organisation and to continue to

develop an NYDA employee who is a well-rounded ‘Youth Development Practitioner’.

9. To ensure a lean and streamlined organisational structure. 10. Re-energise the NYDA to become a more credible and capable

organisation.

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Project Scope

• Proposed /recommended new structure – macro and micro organisational structure.

• Competency framework outlining required skills and competencies required to deliver on mandate and five year plan

• Implementation plan to migrate staff from current to new structure

• Designed new Job Functions and Job Descriptions

• Report on high level Job Evaluation of all positions

• Report on salary benchmarking of all Job Functions in the recommended structure

• Implementation plans for the review of the organisational structure and the development of a HR plan.

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Road to the approved ‘To Be’ Functional and Macro Organisational Structure

C.E.O

EM: Corporate

ServiceC.F.OEM: SDC

Senior Manager: Enterprise

Finance

EM: Communicat

ions

Senior Manager:

Rural Developmen

t

Senior Manager:

BDS

EM: NYS & Skills

Development

EM: Economic

Development

Chief Information Officer

EM: Corporate Partnershi

ps

EM: Research &

Policy

Senior Manager: Lobbying, Advocacy

and Parliamentary Liaison

Senior Manager:

Civil Society &

Public SectorSenior

Manager: Private

Sector and Internation

al Relations

Senior Manager:

Communications

Senior Manager:

Marketing & Branding

Senior Manager: Recruitm

ent Services

Senior Manager: Remuneration &

Employee BenefitsSenior

Manager: Employee Relations

& WellnessSenior

Manager: Human

Resource Developm

ent

Senior Manager: Corporate Support

Senior Legal

Advisor

Senior Manager:

ICT Projects

Senior Manager: Business

Applications

Senior Manager:

ICT Infrastruct

ureSenior

Manager: Enterprise Architectur

e and Governanc

e

Senior Manager: National

Youth Services

Senior Manager: National

Youth Services

Senior Manager:

Skills Developme

nt

Senior Manager:

CYDP

Senior Manager: Operations Support

Senior Manager: Research

Senior Manager:

Policy

Senior Manager:

M&E

Senior Manager: Finance

Senior Manager:

Supply Chain

NYDA “As - Is” DesignAdministrative Macro Structure

General Manager: Strategic

Programmes

Senior Manager:

Quality Assurance

and Compliance

Senior Manager: Corporate Strategy

General Manager:

Risk Manageme

nt and Internal

Audit

Position Title Number of Positions

Executive Management (incl. CEO)

10

Senior/General Management

31

Managers 68

Approved ‘To Be’ Functional Structure

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Programme Planning and Initiation

Programme Management

Service Delivery Channel

Intergovernmental Relationships (IGR)

Budget, Reporting and asset

management

Finance Operations

Supply Chain Management

Human Resources Management

ICT

Internal and External

Communications

Legal ServicesFacilities Management

Knowledge Management

Strategic Planning

Organisational Performance MonitoringProgramme

Monitoring and Evaluation

Policy and Process Co-ordination

Policy and Process Co-ordination

Corporate InvestmentsCorporate Investments

Organisational Risk Management Call Centre

- Board Committee

- Internal Audit Committee

- Board Committee

- Internal Audit Committee

National NYS Coordination

Provincial & Local Level NYS

Coordination

1 2 3 4 5

Key major changes

• The following functions have been incorporated into new clusters/divisions: − ICT and Communication into Corporate Services. − Programme Monitoring and Evaluation into Corporate Planning and

Strategy.− SDC, Economic Development, Skills & Education, Special Projects and

Health & Wellbeing into the Programme Design, Development and Delivery.

− Facilities into Finance. − Organisational Risk and Knowledge Management into Corporate Planning

and Strategy. • The following functions have dual reporting line (solid reporting line to the

Board and a dotted to the CEO): − Internal Audit. − Company Secretariat.

• Corporate Partnerships divided into Intergovernmental Relationships and Corporate Investments, reporting to Programme Design, Development and Delivery and the CEO respectively.

• National Youth Service, a standalone NYDA programme to deal with the engagement, infiltration and advocating of NYS in all spheres of government as per the NYS Framework.

• The introduction of a Business Partner Model for Communications and HR, to ensure effective and responsive support to the branches and head office.

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Benefits of the ‘To Be’ Functional and Macro organisational structure

Approximately 14% reduction of the salary bill at a Macro organisational level – from R 60, 443, 247.73 (35% of total salary cost) to R 37,772,891.86 (22% of total salary cost)

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Total number position at a macro level reduced from 116 positions on the ‘as is’ to 50 positions on the ‘to be’ organisational structure. Reducing the number of EM’s to 5 positions, Senior Managers to 7 positions and Managers to 35 positions.`

Integration of programmes, products and services - clear integrated, value chain effect of programmes – whether they are core or administrative programmes. This will: 1) Reduce turnaround times, 2) eliminate duplication of effort that might occur; 3) Improve stakeholder relations and customer relations; 4) Enhance service delivery.

Focus on product and programme enhancement - proactive in the development of youth development programmes, products and services that addresses youth issues in ‘real time’.

Streamlining and strict focus on functions. Dedicated focus on National Youth Service being implemented across National, Provincial and local Government Departments/ municipalities. Cross Functionality - employees working with and offering the service and products of the NYDA should be able to conversant on all the products and services. This will ensure that the NYDA develops an employee who are ‘Youth Cadre’ or Youth Development Specialists.

NYDA Macro Structure “As – Is” vs. “To – Be” Comparison

Number of Manager Positions (Filled & Vacant Positions):Chair & Deputy Chair = 2CEO = 1Executive Manager = 9Senior Manager = 31Manager = 68

Financial (Based on current CTC)

Cost of Macro Structure =

R 60, 443, 247.73 (35% of total salary cost)

Total number of Positions:

116 macro level staff establishment (84 filled positions)

Number of Managers:Chair & Deputy Chair = 2CEO = 1Executive Director = 5Senior Manager = 7Manager = 35

Financial (Based on 50th Percentile as per current Patterson Grading)

Cost of Macro Structure =

R 37,772,891.86 (22% of total salary cost)

Total number of Positions:

50 macro level staff establishment

“As

– Is

”“T

o – B

e”

“To – B

e”

The figures above are based on the following assumptions:1.That the salary information provided to PwC as at the 19th February 2015 is valid and reliable.2.The 50th percentile of Patterson salary bands were used to determine and estimate the costing of the “To – Be” Macro Structure.3.The costing of the “To – Be” Macro Structure does not include outsourced functions in ICT, Facilities and Communications.4.Number of positions were calculated per Division based on updated divisional structures (as @ January 2015) and headcount/salary list (as @ December 2014), therefore management salaries for new recruits and leavers have not been included in this exercise from the 1st of February.5.Job evaluation exercise has not been conducted for the ‘To Be” Macro Structure costing, therefore the costing is only based on the current Patterson Grading System.

- ENDS -

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presentation to parliament on the annual performance and five year strategic plan 15 april 2015 by...

Documents

nyda macro structure

corporate services

youth development specialists

national youth service

macro level

vacant positions

macro organisational

standalone nyda programme