EPWP Phase 2 Overview Progress

EPWP Phase 2 • Overview & Progress • Data flow • Provincial incentive grants SELECT COMMITTEE ON PUBLIC SERVICES 18 June 2014 EPWP: MINMEC PRESENTATION Stanley W. Henderson 1

Outline q q q Background & Overview of EPWP Progress against Targets Data Integrity & Data Quality EPWP Incentive Grants to Provinces & Municipalities Measures taken to ensure that low capacity Municipalities can access Integrated Incentive Grant. q Overview of Municipalities accessing EPWP Integrated Grant. q Impact of the EPWP on Beneficiaries 2

Background q The goal of EPWP Phase 2 is to create 4. 5 million work opportunities (equivalent to 2 million full time equivalents) for poor and unemployed people in South Africa so as to contribute to halving unemployment by 2014, through the delivery of public and community services. q EPWP support public bodies from all spheres of government (in terms of their normal mandates and budgets) and the Non-State sector through Government incentives to deliberately optimize the creation of work opportunities for unemployed and poor people in South Africa through the delivery of public and community services 3

Definition of EPWP q The EPWP is a nationwide programme covering all spheres of government and state-owned enterprises. q It aims to draw significant numbers of unemployed, unskilled people into productive work, so that they increase their capacity to earn an income. q While the EPWP provides an important avenue for labour absorption and income transfers to poor households in the short to medium-term, it was not designed as a policy instrument to address the structural nature of the unemployment crisis 4

What is an EPWP Project? q Deliberate attempt by the public sector body to use expenditure on goods and services to create work opportunities for the unemployed q Projects usually employing workers on a temporary or on -going basis (either by government, by contractors, or by other non-governmental organisations), under Code of Good Practice for SPWP or learnership employment conditions q Clear work opportunity targets were set for designated groups, namely: q Women – 55% q Youth – 40% q People with Disabilities – 2% 5

Sector Overview q Creating productive employment opportunities q. Infrastructure Sector: Increasing the labour intensity of government-funded infrastructure projects q. Environment and Culture Sector: Creating work opportunities in public environment and culture programmes (e. g. , Working for Water, Food for Waste) q. Social Sector: Creating work opportunities in public social programmes (e. g. , Community Health Workers, Early Childhood Development practitioners) q. Non-State: q q NGO Programme: to be delivered by non-state bodies that have a specific focus area such as health care, child care, community safety Community Work Programme (CWP): programmes targeted at a specific area that will generally involve a large range of different activities identified as necessary and beneficial work by the community in consultation with local government 6

EPWP Progress Against Targets • EPWP phase 2 has created 3, 054, 027 work opportunities against the business plan target of 4, 500, 000 which represents 68% of the target at the end of the 4 th quarter of the 12/13 financial year. • In terms of Full Time Equivalents (FTEs), 868, 974 FTEs have been reported against the target of 2, 020, 435 translating to 46% of the target being achieved. This is because the projects duration of work opportunities are generally shorter than anticipated. • Considering the 4 th quarter report of the 12/13 financial year, 93% of the expected target of 3, 270, 000 has been achieved. • For the 12/13 financial year, by end of the 4 th quarter 941, 593 work opportunities have been created against the target of 1, 210, 000 for the 12/13 financial year which is 78% for the financial year. 7

Overall Annual Targets (5 Years) per financial year Financial Year EPWP annual work opportunity targets EPWP cumulative work opportunity targets 2009/10 550, 000 210, 870 2010/11 642, 000 1, 192, 000 260, 870 471, 740 2011/12 868, 000 2, 060, 000 361, 739 833, 479 2012/13 1, 210, 000 3, 270, 000 502, 174 1, 335, 563 2013/14 1, 650, 000 4, 920, 000 684, 783 2, 020, 436 Total 4, 920, 000 EPWP annual FTE targets EPWP cumulative FTE targets 2, 020, 436 Source: Business Plan (dated January 2009) • Work Opportunities : number of individuals reported to have been employed on an EPWP project • FTE (Full Time Equivalence) : person days of work and training divided by 230 days 8

Work opportunities per sector against annual target for 201213 (Overall) (1 Apr 2012 – 31 March 2013) 9

Infrastructure Sector (Prov Govt Depts & Municipalities): Work opportunities against 2012 -13 targets by Province (end Q 4: 1 April 2012– 31 March 2013) Provinces Target Municipalities Wk Opp Reported % Target Total Wk Opp Reported % Target Wk Opp Reported % End of Q 3 1213 %: EC 37, 271 51, 826 139 54, 452 30, 397 56 91, 723 82, 223 90 FS 16, 151 7, 705 48 22, 234 4, 388 20 38, 385 12, 093 32 24 GP 34, 984 8, 020 23 61, 402 29, 097 47 96, 386 37, 117 39 28 KZN 49, 406 55, 543 112 72, 836 28, 563 39 122, 242 84, 106 69 60 Lim 31, 668 7, 908 25 43, 164 20, 155 47 74, 832 28, 063 38 26 Mp 17, 548 9, 885 56 24, 922 9, 608 39 42, 470 19, 493 46 38 NC 12, 464 12, 357 99 8, 957 5, 798 65 21, 421 18, 155 85 NW 19, 765 5, 729 29 27, 232 6, 548 24 46, 997 12, 277 26 WC 15, 693 11, 019 70 21, 971 19, 497 89 37, 664 30, 516 81 66 234, 948 169, 992 72 337, 170 154, 051 46 572, 118 324, 043 57 45 Total 76 22 24 % - Percentage of work opportunities reported against target Wk Opp Reported – Work Opportunities reported to date [1 Apr 2012 – 31 March 2013] Source: Targets – Business Plan (Dated Jan 2009) 10

Infrastructure, Environment and Culture and Social Sectors (TOTAL) (Prov Govt Depts & Municipalities): Work opportunities against 2012 -13 targets by Province (end Q 4: 1 April 2012– 31 March 2013) Provinces Target Municipalities Wk Opp Reported % Target Total Wk Opp Reported % Target Wk Opp Reported % EC 62, 506 60, 249 96 54, 452 41, 279 76 116, 958 101, 528 87 FS 36, 533 15, 870 43 22, 234 10, 354 47 58, 767 26, 224 45 GP 90, 097 38, 422 43 61, 402 45, 164 74 151, 499 83, 586 55 KZN 103, 323 82, 490 80 72, 836 34, 175 47 176, 159 116, 665 66 Lim 60, 691 36, 251 60 43, 164 23, 258 54 103, 855 59, 509 57 Mp 39, 234 40, 016 102 24, 922 17, 439 70 64, 156 57, 455 90 NC 25, 705 22, 435 87 8, 957 8, 889 99 34, 662 31, 324 90 NW 44, 046 22, 014 50 27, 232 12, 724 47 71, 278 34, 738 49 WC 50, 171 25, 184 50 21, 971 47, 122 214 72, 142 72, 306 100 512, 307 342, 931 67 349, 163 240, 404 69 861, 470 583, 335 68 Total % - Percentage of work opportunities reported against target Wk Opp Reported – Work Opportunities reported to date [1 Apr 2012 – 31 March 2013] Source: Targets – Business Plan (Dated Jan 2009) *Municipal target: Infra targets plus Environment & Culture and Social Sector targets not broken down per prov 11

Work opportunities per sector and province (Overall) (1 April 2012 – 31 March 2013) Province EC FS GP KZN LP MP NC NW WC TOTAL Non-State: Community Work 32, 206 18, 525 17, 815 25, 379 12, 259 9, 582 5, 164 13, 776 9, 832 144, 538 Non-state: Environment & Culture Infrastructure 38, 391 13, 984 25, 011 31, 195 25, 737 35, 265 12, 341 11, 525 50, 663 244, 112 84, 203 12, 491 39, 616 85, 378 36, 254 20, 250 18, 630 13, 117 30, 737 340, 676 Non Profit Organisations 6, 355 3, 294 2, 184 6, 128 6, 406 4, 280 2, 790 5, 128 4, 034 40, 599 Social TOTAL 18, 553 10, 578 37, 017 24, 672 25, 015 15, 647 8, 695 17, 275 14, 216 171, 668 179, 708 58, 872 121, 643 172, 752 105, 671 85, 024 47, 620 60, 821 109, 482 941, 593 12

Causes for not meeting some of the targets The main causes for not meeting some of the targets as follows: • Lack of adequate technical capacity in public bodies to design and implement projects labourintensively. • Delays in implementing projects due to administrative delays like procurement delays. • Under-reporting of EPWP work opportunities created on projects. 13

Measures being undertaken to improve performance • Technical support is being undertaken to help public bodies design and implement their projects labour-intensively. Much of the focus is on providing technical support to municipalities that lack technical capacity. • Re-orientation courses on labour-intensive methods of construction are being conducted in all the provinces. • Public bodies are being provided with assistance to report EPWP work opportunities through data capturing support. 14

Importance of Data Quality q The EPWP emphasizes good data quality because it is explicitly evidence based and results oriented. q Good data are needed to inform the design of interventions and to monitor and evaluate the programmes quantitative progress toward pre-determined targets. q Ultimately, the EPWP is committed to accuracy of information for purposes of accountability and, more importantly, for use of quality data to improve programs. 15

Ways EPWP Ensures Good Data Quality q Data from all public bodies is captured into the EPWP reporting systems as per the prescribed data fields and validation rules. q Validation rules are applied to the reported data during collation. q Projects that do not pass the validation rules due to poor data quality, those projects are excluded from the final reports. q In the cases where the data is found not to be of poor quality, feedback is given to public bodies to implement corrective measures. 16

Introduction to the EPWP Incentive Grant was introduced in EPWP Phase II to: q Reinforce and reward public bodies that actually implement employment -intensive methods and utilise their existing infrastructure allocations effectively to increase the labour content of infrastructure delivery. q Encourage public bodies to meet their targets or hold them accountable q Rapidly expand job creation q Ensure increased employment-intensity of infrastructure projects q Encourage more uniform wage structures q Focus on poor, marginalised, rural areas and the willing unemployed q Mainstream EPWP criteria & outputs with the core mandates and programmes of implementing public bodies 17

Overview of the EPWP Incentive Grant q The EPWP integrated grant to provinces and municipalities is applicable to the Infrastructure and, Environment and Culture Sectors. q The projects implemented using the EPWP integrated grant in the Infrastructure sector include: roads and storm water projects, sanitation projects and building projects. q The projects implementing in the Environmental and culture sector include: Beautification projects, greening projects and Waste collection projects. q In terms of expenditure, for the 12/13 financial year, by the end of March 2013, for Provinces, 100% of the grant has been transferred to Public bodies. q Challenges experienced regarding the incentives is the low expenditure reports submitted by public bodies to the NDPW. q Follow up has been made with different Public bodies with low spending on the integrated grant. Withholding letters were also written to Public bodies that were not complying with the requirements of the grant. q Low expenditure in the different Public bodies has been due to internal challenges faced by the public bodies like delays in procurement that affect implementation of projects. 18

EPWP PERFORMANCE ON THE SOCIAL SECTOR INCENTIVE GRANT 19

Social Sector EPWP Grant for Provinces In line with the Conditional Grant Framework in Do. RA 2012 the Social Sector EPWP Grant for Provinces has three major output indicators to achieve: q Servicing the household q Supporting 3 052 non profit organisation(NPOs) q Paying stipends to 11 925 beneficiaries For the financial year 2012/13 a total allocation of R 217 401 000 was distributed to provinces as follows: Province Eastern Cape Free State Gauteng Kwa. Zulu Natal Limpopo Mpumalanga Northern Cape North Western Cape Incentive Allocations R R R R R 22 120 651 23 907 776 41 944 860 1 672 925 57 734 384 13 659 326 2 073 404 29 564 135 24 724 540 20

Expenditure of the Social Sector EPWP Grant to Provinces (2012/13) Provincial Department NC-Sports, Recreation, Arts & Culture NC-Social Development FS-Education FS-Health FS-Sports, Recreation, Arts & Culture LP-Education LP-Social Development LP-Health NW-Sports, Recreation, Arts & Culture NW-Social Development NW-Health GT-Social Development WC-Education WC-Community Safety MP-Sports, Recreation, Arts & Culture MP-Education MP-Safety & Security EC-Sports, Recreation, Arts & Culture EC-Health EC-Social Development KZ-Community Safety & Liaison TOTAL Allocation Total Payment Expenditure by % Q 4 Provinces (End Expenditure Feb) (End Feb) R 567, 686 100. 00% R 0 0. 00% R 1, 505, 718 100. 00% R 1, 506, 000 100. 02% R 10, 097, 566 100. 00% R 6, 240, 000 61. 80% R 5, 941, 405 100. 00% R 4, 326, 588 72. 82% R 7, 469, 854 100. 00% R 7, 255, 000 97. 12% R 398, 951 100. 00% R 398, 900 99. 99% R 18, 556, 962 100. 00% R 12, 765, 000 68. 79% R 9, 980, 122 100. 00% R 9, 356, 000 93. 75% R 29, 197, 300 100. 00% R 28, 616, 226 98. 01% R 903, 135 100. 00% R 634, 211 70. 22% R 11, 657, 368 100. 00% R 8, 945, 000 76. 73% R 17, 003, 632 100. 00% R 17, 004, 000 100. 00% R 29, 072, 053 100. 00% R 22, 153, 033 76. 20% R 12, 872, 807 100. 00% R 10, 569, 000 82. 10% R 23, 923, 576 100. 00% R 19, 359, 887 80. 92% R 799, 964 100. 00% R 758, 000 94. 75% R 524, 349 100. 00% R 453, 081 86. 41% R 12, 613, 004 100. 00% R 12, 024, 920 95. 34% R 521, 973 100. 00% R 143, 550 27. 50% R 1, 632, 795 100. 00% R 1, 605, 500 98. 33% R 13, 779, 884 100. 00% R 13, 699, 483 99. 42% R 6, 707, 972 100. 00% R 6, 708, 000 100. 00% R 1, 672, 925 100. 00% R 528, 000 31. 56% R 217, 401, 000 100. 00% R 185, 049, 379 21 85. 12%

Performance of the Social Sector EPWP Grant q A total of R 217 401 million was transferred to the provinces as at the end of March 2012. This is equivalent to 100% of the total allocation to provincial departments. q There is no outstanding payment total that still needs to be transferred to the provinces. q To date, 85% of the total transfer has been reported as spent by all receiving provincial departments. 22

EPWP PERFORMANCE ON THE EPWP INTEGRATED GRANT TO PROVINCES 23

Performance on the EPWP Integrated Grant to Provinces for 12/13 Financial year Summary by Province Allocated (R’ 000) Transferred to date (R’ 000) Transfers as a Expenditure % of allocation as of end of March 2013 (R’ 000) Expenditure as % of allocation Eastern Cape 60 333 100% 63 118 100% Free State 21 391 100% 12 114 57 % Gauteng 18 885 100% 13 076 69% Kwa. Zulu-Natal 79 506 100% Limpopo 48 983 100% 48 953 100% Mpumalanga 26 255 100% 23 621 90% 9 915 100% 4 657 47% North West 10 444 100% 6 444 62% Western Cape 17 099 100% 12 721 74% 292 761 100% 264 210 90 % Northern Cape Total 24

Report on Signing of Incentive Agreements by Provinces q A total of 61 departments were sent Agreements to be signed. q To date, 38 departments have signed and returned the agreements to the department which is 62% of the total protocols. q North West and Gauteng provinces have the least number of protocol agreements signed by their participating departments. q Northern Cape and Western Cape participating departments are the only departments that have signed all their protocol agreements. 25

Performance on the EPWP Integrated Grant to Provinces q In terms of the EPWP Integrated Grant to Provinces, 100% of the grant has been disbursed by the National Department of Public Works. q In terms of expenditure, 90% of the grant has been spent by the eligible Provincial Departments as at the end of March 2013. q Full expenditure of the grant was not achieved in Free State, Gauteng, Northern Cape, North West and Western Cape Provinces. q Full expenditure has not been achieved by the public bodies because of delays in implementation of projects. 26

EPWP PERFORMANCE ON THE EPWP INTEGRATED GRANT TO MUNICIPALITIES 27

Performance on the EPWP Integrated Grant to Municipalities for 12/13 Financial year Summary by Province Eastern Cape Allocated (R’ 000) Transferred to date (R’ 000) Transfers as a % of allocation Exp. to date (R’ 000) Exp. as % of allocation Exp. as % of transferred allocation 103 094 100% 50 577 49% 42 803 100% 23 318 54% 180 872 100% 79 992 44% Kwa. Zulu-Natal 95 487 100% 36 471 38% Limpopo 48 864 100% 25 857 53% Mpumalanga 45 851 100% 29 640 65% Northern Cape 35 578 100% 24 318 68% North West 44 161 100% 29 994 68% Western Cape 62 425 65 425 100% 51 255 78% 662 135 100% 351 422 53% Free State Gauteng Total 28

Performance on the EPWP Integrated Grant to Municipalities q In terms of the EPWP Integrated Grant to Municipalities, 100% of the grant has been disbursed by the National Department of Public Works. q In terms of expenditure, 53% of the grant has been spent by the eligible Municipalities as at the end of March 2013. q The expenditure of the municipalities varies across the different provinces. Expenditure is highest for eligible municipalities in the Western Cape at 78%. q The worst expenditure is by Municipalities in Kwa. Zulu-Natal at 38% mainly due to poor reporting on expenditure. q Follow up is being made to the different public bodies to provide reports. 29

Number of Eligible Municipalities: 2012/13 and 2013/14 Province No. of Eligible Total Incentive No. Of Total Incentive Municipalities Grant Eligible Grant 2012/13 Allocation Municipalities Allocation 2012/13 2013/14 (R) (R’ 000) Eastern Cape 45 103 094 45 92 629 937 Free State 23 42 803 24 36 855 671 Gauteng 12 180 872 12 143 807 822 Kwa. Zulu-Natal 36 95 487 57 114 437 496 Limpopo 30 48 864 30 39 379 471 Mpumalanga 21 45 851 21 41 274 528 Northern Cape 26 35 578 32 37 617 839 North-West 23 44 161 23 37 708 511 Western Cape 30 62 425 30 66 962 726 National Total: 246 662 135 274 R 610 674 000 30

Measures Taken to Ensure Low Capacity Municipalities Access Incentive Grant Re-orientation workshops on employment-intensive methods q Municipal officials trained on design, implementation, monitoring and reporting on employment-intensive projects Road Shows on Integrated Grant Held in Provinces q Road shows held in all provinces. q Items covered included; eligibility requirements, conditions of the grant and reporting requirements. 31

Measures Taken to Ensure Low Capacity Municipalities Access Incentive Grant … Cont’d Project visits conducted to Monitor compliance on EPWP q In all provinces to monitor compliance and to provide implementation advice q Total of 887 projects being implemented in municipalities were visited. Of the projects visited, 526 were in the Infrastructure Sector, while 361 were in the Environment & Culture Sector q Information verified on site included; number of work opportunities, person-days of work, as well as branding q Compliance items like attendance registers, employment contracts and payment registers also verified q Information on location of projects including geo-coding also obtained 32

Measures Taken to Ensure Low Capacity Municipalities Access Incentive Grant … Cont’d Additional Technical Capacity Appointed to Support Municipalities q Service providers appointed to complement NDPW technical support team in supporting municipalities in November 2012 q With additional resources more municipalities will be covered and each municipality will get more focused attention. 33

EPWP II & Beyond: Strategy going forward q Consolidation - Growing the existing EPWP programmes; focus will be on: q Improving reporting q Expand the number of public bodies participating in delivering EPWP activities q Improve the labour intensity of the existing programmes q Expand the size and scope of existing programmes q Improve the profile, packaging and promotion of the existing programmes, including developing flagship programmes as part of the non-state sector 34

Impact of EPWP: Purpose and Objectives of Research q q The EPWP Evaluations and Research unit continuously conducts studies as per the M&E framework. The studies include: q Process evaluation which examines the efficiency and effectiveness of program implementation processes q Impact evaluations to determine the impact of the programme on beneficiaries and impact of the programme in reducing unemployment. 35

Impact of EPWP on Beneficiaries Lives q “I have gained a lot of life skills as a breadwinner I can take care of my family including orphans”. q “I became more responsible as a citizen and husband, I'm now capable of doing things for my family that I couldn’t do before like paying school fees”. q “I was able to build myself a proper house, a brick house so that my family could be protected from rains”. q “With the money I get from EPWP, I managed to build up a two roomed brick house and moved out of a shack. Enkosi EPWP” q “I didn’t have a job for many years but now I am working as a carer and getting experience on how to deal with peoples health problems in their homes”. q “I have a certificate and I am going to use it in future when I am looking for another job and I am also gaining experience” 36

Impact of EPWP on Beneficiaries Lives……. . q “I managed to buy a deep freezer for myself. I plan to use it to open a small business and sell meat in the township. I will make money after the project has ended” q “Thanks to the EPWP project, my family has managed to live a little more comfortably and afford some luxuries. I even bought a television set; if it was not for the EPWP project, I never would’ve been able to afford it. ” q “ I thank this project, they helped me to open my first bank account ever. I am 59 years of age and have a bank account. At the end of the month when my salary is deposited, the bank sends me an sms’. 37

Impact of EPWP on Beneficiaries Lives………. . q “I used to sleep on the floor with my children. With the money I received from the project, I managed to buy a Seally bed. We now sleep on a proper bed and our lives have changed” q “ The project gave me skills. I was trained to be a teacher for children. I now know more about children and I enjoy teaching them” q “I now have my own vegetable garden due to the experience that I have gained while working on this project. We don’t buy vegetables anymore” 38

Impact of EPWP on Communities q “People got work from the project, they managed to build their houses, others are educating their children, most of the people are now working in this community” q “For those that use their cars, we have helped them by closing potholes and cut trees along side of the roads”. q “Before kids were suffering others had no food but now come to us and we help them with food and homework's” q “other children come to schools without food and now the parents know their children will get food at school they wont stay hungry the whole day. ” q “Roads are maintained after heavy rain and the cars are able to go on the streets” 39

Community Impact……. q “Roads being constructed now and again taxis are able to come even if its raining”. q “The community is clean and people are no longer getting mugged because we cutting the bushes down. The crime rate has reduced in our community” 40

Thank you. Stanley W. Henderson DDG: EPWP Cell: +27 (83) 676 5119 +27 (12) 310 5110 Email: stanley. henderson@dpw. gov. za 41