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17 May 2005

Honourable Chairperson
The Honourable Deputy Minister of Public Works, Mr Ntopile Kganyago
The Honourable Chairperson of the Select Committee on Public Services, Mr RJ Tau
All MECs from the various provinces
Honourable Members
Senior managers from the Department
Distinguished guests
Ladies and Gentlemen

INTRODUCTION

The Department of Public Works (DPW) undertook a major restructuring exercise in 2003/04 to improve its capacity to be able to deliver efficiently and effectively relying primarily on its network of regional offices. The aim has been to bring our services closer to our clients’ operations. Our regional offices have also been building relations with their provincial and municipal counterparts, with the aim of achieving a more integrated approach.

MAJOR ACHIEVEMENTS IN 2004/2005

THE EXPANDED PUBLIC WORKS PROGRAMME

One of the key programmes to be launched by government is the Expanded Public Works Programme (EPWP), which is operational in all the nine provinces. In the first nine months of the programme, R2.4 billion was spent on 1 890 projects to create 144 056 gross job opportunities. This exceeds the target of 130 000 opportunities for the first year of the programme.

The role of my department in the programme is to put in place an enabling environment and to facilitate the roll-out of the programme. The EPWP is a government-wide programme and its success depends on provinces and municipalities taking ownership of the programme and using their budgets to create more employment coupled with training for the unemployed. The DPW has a strong unit in place, which is available to provide provinces and municipalities with advice, drawing on the best practices from around the country. We are confident that, with the co-operation of all organs of state in all spheres of government, the EPWP will continue on yearly basis to exceed its employment creation targets, and make a significant contribution to alleviating unemployment and promoting ‘a nation at work’.

The expansion of Limpopo’s Gundo Lashu labour-intensive roads programme under the EPWP to date is an example of how the programme can work. The Gundo Lashu programme, which began as an initiative of the Limpopo Provincial Government, has gained national recognition as an example of best practice. This programme has now been expanded to all nine provinces, with 32 provincial departments and municipalities having signed Memoranda of Understanding with national DPW and the Construction Sector Education and Training Authority (SETA) to enable the similar recruitment and training of 500 contractors and 1 000 supervisors.

The EPWP unit in DPW has facilitated this expansion. This facilitation has included putting in place agreements with various partners in the programme, including agreements with ABSA Bank to provide access to credit and bridging finance for the learner contractors, with the Construction SETA to provide the funding for the training and the IDT to provide social facilitation services. The participating provinces and municipalities use their infrastructure budgets to provide the learner contractors with practical training projects. A Memorandum of Understanding will soon be signed with First National Bank, which will help our people gain access to finance even further.

The established business community is starting to join us in our endeavour to implement the EPWP. The Business Trust has committed R100 million to provide programme management support to all levels of government, to ensure that lack of capacity is not an impediment to implementing the EPWP. This programme management support is currently being put in place on the ground.

All of these learner labour-intensive contractors are registering on level one or two on the Construction Industry Development Board’s Register of Contractors, and by the end of their learnerships they will have acquired the necessary experience and track record to register at level three or four of the Register. Each of these contractors will typically employ between 50 and 100 people on labour-intensive construction sites. This initiative will therefore simultaneously make a significant contribution to broad-based black economic empowerment (BEE) and develop the management and supervisory skills required to manage labour-intensive construction projects in an efficient and cost-effective manner.

Another provincial EPWP initiative, which has gained national recognition as an example of best practice, is KwaZulu-Natal’s Zibambele programme, under which women are appointed as road maintenance contractors in rural areas. We are currently working with the KwaZulu-Natal Department of Transport to produce a plan to also expand this programme to other provinces and municipalities.

Honourable Chairperson, during the past financial year my Ministry has challenged big business through their corporate social investment budgets in support of our efforts to promote development through EPWP. Both Siemens, Microsoft SA, Anglo American and First National Bank have responded in a manner that will move the process forward.

Siemens, Microsoft SA and I have formulated an agreement to help “BRIDGE THE DIGITAL DIVIDE” in rural South Africa. A pilot project will be launched in the Harding Municipality in the next few weeks. The two companies have also donated computers to the learner contractors of the Western Cape to assist with their entrepreneurial development.

The Chief Executive of Anglo American and I have set out the way forward for his company to “Adopt a Village”.

Credit goes to the Independent Development Trust (IDT), which assisted my office with the mobilisation process as we engaged big businesses. Mandated by Parliament through the Ministry of Public Works to manage the implementation of government development programmes, the IDT supports all spheres of government in meeting their development targets. In 2004/05, the IDT set up over 344 new community structures and also project-managed, among others, the construction of 141 schools in the Eastern Cape and another 124 infrastructure projects in Gauteng under the Zivuseni Poverty Alleviation Programme.

The IDT is also supporting provinces in the rolling out and implementation of the EPWP. The IDT has been supporting provinces to develop the provincial framework and business plans for the implementation of the EPWP as well as playing a Programme Implementing Agent role in Mpumalanga, North West, Western Cape and Eastern Cape, with agreements with Gauteng and Free State being finalised.

ACCOMMODATING GOVERNMENT

With regard to its function of providing for the accommodation needs of national government departments, the Department spent approximately R3 billion on various capital works projects during the past financial year. By the end of the financial year, the Department had fully spent its capital budgets for 11 out of 12 client departments and fully spent its own capital and maintenance budgets.

Some of the notable capital works projects that were successfully undertaken included the R109 million upgrading of the Port Elizabeth Magistrate Court Building and the commencement of the construction of the R42 million South African Police Service (SAPS) and Justice Complex at Motherwell near Port Elizabeth. Two other police stations were handed over to SAPS at Tsomo and King William’s Town in the Eastern Cape. In Gauteng a R40 million Tembisa Magistrate Offices, a R1.2 million Soweto Local Criminal Record Centre and a R6.5 million upgraded Mabopane police station were delivered.

Two Community Safety Centres (CSCs) were completed - one at Tshidilamolomo in Northwest for R8.5 million and the other at Galeshewe in the Northern Cape for R35 million. This means that since the opening of the first centre at Tembalethu near George in the Western Cape in October 2000, all the provinces except Mpumalanga and the Free State now have a Community Safety Centre, in realisation of the goal of the National Integrated Crime Control Strategy of government. In the Free State, a completed R15 million police station at Mangaung was handed over to SAPS in June 2004.

In the Western Cape, the R103 million refurbishment project of 9 Plein Street for the use of Parliament was completed and delivered on schedule. Earlier this year, we handed over the R30 million renovated Parliamentary Media Centres to the GCIS at 120 Plein Street. Included in the project was the upgrading of the Cabinet Room in Tuynhys to accommodate the Presidential Press Corps as part of information sharing and democratisation.

It was with pride that we completed the R4.3 million Inkosi Albert Luthuli Legacy Project in KwaZulu-Natal and handed it over to the Department of Arts and Culture in honour of the struggle stalwart who laid concrete foundations for the democratic South Africa that belongs to all who live in it, black and white.

In the Northern Cape, more than R8 million repairs and renovations projects were undertaken on behalf of the Department of Defence at Kimberley and a R9 million police station were constructed for the SAPS.

BUDGETS AND FOCUS AREAS FOR 2005/2006

In 2005/06, the National Department of Public Works will manage the expenditure of R7.5 billion, which is made up of its own budget of R5.5 billion and R2 billion worth of projects funded from the budgets of its client departments. The Department’s own budget is comprised of a R1.28 billion for leasing, R1.08 billion for municipal services, R947 million for property rates, R927 nine million for maintenance, R946 million for personnel and administration as well as R372 million for the capital works.

BUILDING PROGRAMME FOR 2005/2006

Some of the highlights of the department’s building programme for 2005/06 include the construction of three new embassies in Ethiopia, Lesotho and Nigeria; and the construction of four New Generation Prisons in Northern Cape (Kimberley), North West (Klerksdorp) and Gauteng (Nigel and Leeuwkop). The total cost of these prisons is estimated to be more than R1 billion.

Other major capital works will include two construction projects for Correctional Services worth R12 million and R6 million at Potchefstroom and Mogwase respectively, as well as two others for SAPS at Jouberton (R18 million) and Amalia (R8 million) – all in the North West province.

Both SAPS and Correctional Services in the Eastern Cape will benefit from the construction of the R43 million police headquarters at Bisho and a R21.5 million piggery at the Middelsdrift correctional facility. A R22 million Nerina Place of Safety is under construction for Justice.

In Gauteng, a R169 million New Pretoria Campus for the National Library of South Africa is under construction on behalf of the Department of Arts and Culture and another R36 million major upgrading of the SAPS Forensic Science Laboratory is under way in Tshwane.

In the Free State, we shall undertake, in phases, upgrading and renovations projects worth more than R85 million at 3 Military Hospital on behalf of Defence. Others include the R16 million upgrading and renovations at Goedemoed Prison for Correctional Services and the construction of R7 million and R6 million police stations at Verkykerskop and Phuthaditjhaba, respectively.

In response to the President’s call, we shall intensify our communication with our client departments to plan early and prioritise for the delivery of at least two community courts per province as well as to find alternative accommodation for the children currently in custody particularly in KwaZulu-Natal, Western Cape and Gauteng.

INITIATIVES TO IMPROVE SERVICE DELIVERY IN 2005/06

The Department is embracing the President’s call to “turn every public servant into an activist for social delivery”. Internally, the Department has launched a Management Charter known as the DPW Leadership Way with the aim of introducing a new management ethos in the Department and to address problems such as low staff morale, poor management practices, lack of urgency and lack of customer focus. Integrity, urgency, client focus and team-work are some of the values ingrained in the Leadership Way. Deviations will be met with full might of our disciplinary machinery.

The Department is also implementing a large-scale Service Delivery Improvement Programme as part of its strategic drive to improve customer service and offer value for money to clients. This programme includes setting service delivery standards, introducing more business-like management methods, and entering into service level agreements with client departments. Problems of capacity are also receiving attention through the recruitment of learners, interns and young professionals onto mentorship programmes in the Department.

CONTRIBUTION TO BLACK ECONOMIC EMPOWERMENT IN 2005/06

The department has carried out reviews of some of its existing programmes, including the Repair and Maintenance Programme (RAMP) and the Emerging Contractor Development Programme (ECDP. One of the improvements resulting from these reviews is the Department’s new Contractor Incubator Programme, under which a group of 81 medium-sized black contractors have been selected for mentoring and training with the aim of providing them with the opportunity to become successful large contractors. Our mentorship programme has the development of business management expertise as its core focus. Approximately R182 million worth of work per prison will be executed by the contractors on the Contractor Incubator Programme on each of the four New Generation Prisons.

Challenges related to tendering that were previously identified are currently being addressed through the alignment of our systems to the Preferential Procurement Policy Framework Act and the Supply Chain Framework. The outcomes will entail more transparency, simplicity, standardisation of procurement procedures across the public sector as well as alignment with the BEE legislation.

To eradicate the scourge of fronting, we are tightening our procurement procedures in particular with regard to where preference points are being claimed. We have appointed a service provider to screen and verify credentials given in the supplier register, in a number of cases the revelations are shocking. Stern measures will be taken against anybody misrepresenting facts with a purpose to deceive.

CONSTRUCTION AND PROPERTY INDUSTRY TRANSFORMATION CHARTERS

Current efforts to develop and transform the construction and property industries include the processes to produce Transformation Charters. A target has been set for both of these charters to be finalised and launched in September 2005.

EXPEDITING PUBLIC INFRASTRUCTURE DELIVERY PROCESSES

The President raised serious concerns about the capacity of the public service to implement programmes aimed at addressing the infrastructure backlogs inherited from the past. For example, he mentioned weaknesses in the governance system which results in the school building programme unfolding at a much slower pace than envisaged and delays with the allocation of infrastructure grants.

Together with its counterparts at provincial level, the Department is working on a number of programmes aimed at addressing these concerns. The Infrastructure Delivery Improvement Programme, which we are implementing together with the Construction Industry Development Board, National Treasury, and the Development Bank of Southern Africa, involves working with provinces and municipalities to improve the management of infrastructure programmes, from project planning through to procurement, project delivery and maintenance.

Another important programme in this regard is the implementation of the Contractors’ and Projects’ registers by the Construction Industry Development Board (CIDB), as required by the CIDB Act. Over the past year the Contractors’ register was piloted in Limpopo, KwaZulu-Natal and Gauteng, and will be implemented nation-wide by the end of 2005.

The main aim of the Contractor’s register is to make the construction industry more sustainable. The implementation of this register will result in a reduction in the number of contracts which have to be cancelled due to poor performance by contractors. It will also provide a framework for the development of contractors, and will provide incentives for construction companies to improve their compliance to minimum governance standards, including occupational health and safety.

Let me take this opportunity to commend the initiative taken by the leading industry stakeholders in declaring this week i.e. 16 to 20 May 2005, as the “Construction Health and Safety Week” to coincide with the international conference scheduled in Port Elizabeth from 17 to 20 May 2005 subtitled Rethinking and Revitalising Construction Safety, Health, Environment and Quality.

PROPOSED LEGISLATION FOR 2005/06

The Department has produced a government-wide Immovable Asset Management policy and is currently drafting a Bill to table in Parliament during the course of this year. The aim of the Bill will be to establish uniformity and ensure the application of minimum norms and standards in the management of immovable assets across all spheres of government.

The Expropriation Act of 1975 was last amended in 1994, and the department has engaged the services of external legal experts to work on the amendments. The Department also intends to bring these amendments to Parliament during the course of this year.

IMPROVING THE PHYSICAL WORK ENVIRONMENT OF THE PUBLIC SERVICE

The 2005 Programme of Action requires the Departments of Public Works and Public Service and Administration (DPSA) to develop a framework to improve the physical work environment. Some of the elements of this framework are already being put into place, including the proposed government-wide Immovable Asset Management policy, the Infrastructure Delivery Improvement Programme, the Department’s Service Delivery Improvement Programme and plans for improving accommodation.

Together with the Demand Side Management unit of ESKOM, the Department will also be implementing an energy saving programme on various government facilities such as prisons, magistrates’ courts, police stations and office buildings. The aim of the programme is to optimise the utilisation of electricity on the identified facilities. I am inviting honourable members who can make it to join me at a walkabout as we celebrate Energy Efficient Month at 1 Military Hospital at Thaba Tshwane, Gauteng, on Thursday, 19 May 2005.

CONCLUSION

Despite the constraints of a budget, which is limited in comparison to the backlogs, the Department of Public Works is focused on delivering on its mandate and on improving the quality of services to its client departments. The various departmental programmes and initiatives which I have described will increasingly lead to improved audit reports, better customer-service and improved service delivery to the public.

I thank you.

Issued by: Department of Public Works
17 May 2005
Source: Department of Public Works (http://www.publicworks.gov.za)