G Fraser-Moleketi: Public Service and Administration Dept Budget Vote
2007/08

5 June 2007

Madame Speaker,
Fellow members of Parliament,
Distinguished guests behind me in the officials box,
Ladies and gentlemen in the public gallery

We find ourselves in the second half of the term of office of this
government that will come to an end with the election of 2009. We have also
reached the last five-years before the African National Congress (ANC)
celebrates the completion of its first century in existence. The presentation
of this budget vote should therefore be a sobering moment of reflection on what
we have achieved and what still ought to be done in the short period remaining
before these two milestones are reached.

The budgets we request you to approve today in terms of votes nine, ten and
eleven are critical in our quest to achieve the outstanding priorities for this
term of office. As it has become the custom you have a long version Budget Vote
speech with you. This is essentially a reference document prepared by the
different entities in my portfolio that contains the detail. Time allocated for
this debate only allows for the most cursory reference to some of the rich
information contained in that document. I would encourage you to later
familiarise yourselves with the detail contained in the written Budget Vote
speech.

In any developing society government machinery is critical in delivering
public services and creating an environment in which other societal forces such
as business and community can flourish in their own right. In 2005 the World
Bank, in its report titled Capacity Building in Africa underscored the
importance of the public sector for a developmental and anti-poverty approach.
The report states and I quote:

"African countries must improve the performance of their public sectors if
they are to achieve their goals of reducing poverty, accelerating economic
growth, and providing better services to their citizens."

In 2002, Joseph Stiglitz in his seminal work globalisation and its
discontents also pointed to the fact that there are no cases of successful
economic development in the world where the state has not played a prominent
role. After a period in which the state have been vilified and ridiculed we
have now entered an era globally in which the legitimacy of a strong and
healthy public sphere is once again being restored and treasured.

Our challenge therefore remains to create an environment in which the public
sector can perform optimally, but equally an environment in which public
servants understand how they as public service employees fit into the bigger
democratic dispensation. We have to continue the deliberation and inculcation
of the values bases we would like our public servants to embrace.

Over and above making progress in terms of implementation against the set
priorities of government, the work of this portfolio is about laying firm
foundations for the future. It would be irresponsible not to work towards a
high degree of continuity when it comes to tackling such enormous challenges as
embodied in these priorities. Elections, excluding transitional elections -
should not be markers for radical breaks with what exists, but rather points of
renewing our mandates to continue walking the path we have chosen, with minor
adjustments if need be. Systems of government and administration are too huge,
multidimensional, interconnected and clumsy to want to manoeuvre and change
direction often and over short periods.

During the past 13 years we have given birth to a new institutional
landscape that supports democracy. This includes a new public service. As the
ANC our opinions and values were heavily shaped by observing a system we
definitely did not want to emulate. In essence we elevated in our value system
the issues of responsiveness of an administration to the needs of all our
people. An administration that would be free of bias in rendering services and
in the treatment of citizens. An administration that would in its make-up
reflect the diversity of the people it serves.

In its very early years after apartheid as a nation we ensured we developed
principles that could guide us and the child, the South African public service,
as it matures. Our Constitution leaves no doubt to what is expected from the
public service: what it should be; how it should behave and how it is to fit
into the bigger picture we have for this country.

The ethical framework set out in Chapter 10 of the Constitution has been
further elaborated both in the African Public Service Code, as well as in an
attachment to our public service legislation. We need to acknowledge that the
unpacking of the meaning of these codes need to happen as we move along the
road of deepening our democracy. In addition we have institutions such as the
rule of law, and a rights-based culture that should impact on the public
service. Public servants are not exempted from these.

It therefore poses interesting questions as to how the exercise of some
rights is bounded by other rights and obligations. For example, how is our
right of association to political parties and activism in favour of particular
political causes circumscribed by the rule of law. Do we have to adjust our
repertoires of collective action now that we have a full democracy, compared to
the militancy we could show when we fought an illegitimate system that did not
protect the rights of the people?

Let me take you back to last year's security guard strike. On the one hand
we recognised union's rights to embark on legal strikes and industrial action.
However, in the heat of the strike in order to ensure that the effect of the
strike should not be whittled away by those who were not unionised, or who
chose to go to work, making those decisions on the basis of a set of different
priorities than that of the union's group interest serious infringement of
human rights took place. Examples of intimidation, damage of property and
physical assault were not hard to come by. In some instances people died.

Through processes of questioning and challenging one another, through
continually reflecting on our practice we need to arrive at a situation where
we as a democratic South African society can agree on what the high standards
of professionalism is that the Constitution require from our public servants.
Where does private or group interest stop and where does public good begin?
When is "professionalism" taken too far and becomes a threat to democracy, not
accepting political authority? Or how do public servants both live out their
political persona, while at the same time measure up to what we expect from our
public servants?

We need to engage with one another on exactly what it means to orient our
public administration in the direction of development? When do the demands of
individuals or expressed group interests become a threat to the bigger
collective and become anti-developmental? We need to identify the tensions and
the paradoxes.

This discourse obviously has to take place against the backdrop of our
concept of the developmental state. Amongst other things this requires the
mediation of class conflicts in such as a way that the gains of the National
Democratic Revolution are safe, secure and advanced. We need to protect our
initial democratic gains from counter revolutionary forces through domination
by former economic elites nationally and globally. Continuing to build a
transformed, people-centred public service that is responsive, agile and
participatory is central to protecting the interests of the vast majority of
the oppressed people.

With respect to pubic sector transformation it is important that we heed the
acutely accurate observations Anthony Giddens makes in the introduction to the
volume he edited in 2003 under the title: The progressive manifesto. He wrote,
and I quote:

"Public sector reform in practice is a battleground. It is one that pits
left against left as much as left against right. Many on the more traditional
left actively resist moves towards restructuring. They are last-ditch defenders
of the bureaucratic state. Quite often they have powerful allies in the shape
of the labour unions."

Sir Anthony then continues to point out, and I quote:

"Public service workers form vested interest groups if they act in bad
faith; if they use an appeal to public goods and values to advance or protect
their own sectional interests."

The Ministry for Public Service and Administration is a complex and broad
portfolio. It contains two full government departments, the Department of
Public Service and Administration (DPSA) and the South African Management
Development Institute (Samdi). In addition, providing for different shareholder
and accountability relationships the portfolio also includes the State
Information and Technology Agency (Sita), the Centre for Public Service
Innovation (CPSI), the Public Sector Education and Training Authority (PSETA)
and the Government Employees Medical Scheme (Gems). Whilst operationally
entirely independent from executive oversight, for budget purposes the Public
Service Commission is also included in the Public Service and Administration
portfolio.

Being at the helm of these entities is a demanding job. At the same time the
experience is a career opportunity second to none. It prepares already
exceptional managers for even bigger challenges, making them highly
sought-after. Predictably therefore, we have seen some changes in instances in
the top cadre during the term. Mavuso Msimang, who very capably steered Sita
through some challenging transformation processes, is having his work cut out
for him as the new Director-General (DG) in the Department of Home Affairs. I
wish him the very best, since Home Affairs is arguably one of the most
important indicators we have as to how the public experience public service in
general.

We were fortunate in bringing on board the highly experienced Dr Mark Orkin
to steer Samdi's transformation to a fully-fledged Public Service Academy. I
can also state here that I have extended the contract of Dr Richard Levin as DG
of the DPSA. This will ensure continuity in leadership during a critical
period. We hope to soon fill the leadership gaps at the top of Sita, the Centre
for Public Service Innovation (CPSI) and the Public Sector Education and
Training Authority (PSETA).

The State is heavily reliant on the strength and capability of the system of
government to successfully implement the range of programs designed to respond
to the developmental challenges we are facing. Excellence in performance across
and within the three spheres, underpinned by the availability of capacity
(skills, human capital resources and systems), attracting and retaining the
right capacity, its location and optimal use as well as maintaining an ethos of
service becomes of central concern and importance.

These are what can be termed 'critical success factors' for achieving the
goals of the developmental state and in the absence of any of these; the
overall effectiveness of government delivery becomes compromised. Accordingly,
we have spent significant effort during the past year in getting a firmer grip
on the issue of capacity for the developmental state. Some of the highlights in
this respect I could share are the following:

The Ministry for the Public Service and Administration is at the forefront
of government's investigation into the capacity and organisation of the state.
In October 2004 President Mbeki asked Ministers whether the South African
developmental state, was capacitated, organised and resourced to deliver on
government's socio-economic objectives. The Ministry, as leader of the
Governance and Administration (G&A) cluster, has been conducting sectoral
capacity assessments aimed at understanding capacity constraints within
government.

A consolidated report on this work is currently being prepared. In addition,
we have made progress with the development of a skills database for the public
service. A pilot involving four departments has been completed and the project
is currently being rolled out to 20 government departments. The skills
information on employees' current skills, job descriptions and skills
requirements as is currently captured allows for the identification of skills
gaps per employee as currently placed, but also allows us to understand skills
gaps per occupational category. It will also afford us the possibility to track
the ongoing training of employees and the impact that has on addressing skills
gaps as identified. On the level of organisational restructuring to ensure
greater capacity for delivery, this Ministry is supporting departments in the
process. We have also developed a guide on how to design, implement and
maintain organisational structures in the public sector. This publication is
available to departments, along with an implementation plan for organisational
restructuring.

Extensive capacity building programmes, both on organisational, but
particularly individual level have been undertaken during the past year. Some
examples include the training of close to 500 managers under the Presidential
Strategic Leadership Development Programme and a first intake of 103
participants in our Public Service Sustainable Pools Scheme. This programme has
a particular emphasis on the advancement of black women managers. More than 36
000 public servants have gone through our compulsory induction programme.

We continue to maintain an active programme with respect to learning
networks, conferences, seminars, academies and exposure in the field. In this
respect Project Khaedu in terms of which Senior Managers are exposed to the
realities of service delivery at the coalface remains one of the most
innovative. By March this year, close to a thousand Senior Management Service
(SMS) members have participated in the Khaedu experience.

Underpinning the system of public service training is the work of the PSETA.
PSETA, in addition to its responsibilities with respect to the transversal and
general public service competencies, has acquired the responsibility for
quality assuring the line function qualifications of a range of departments,
including that of Foreign Affairs, Labour, Trade and Industry, Housing, Home
Affairs and Statistics South Africa (StatsSA). During the past year it has
strengthened its role with respect to accreditation of training providers and
it has finalised three models for assessor training for implementation in the
Public Service.

This Ministry is playing an active role in the Accelerated and Shared Growth
Initiative for South Africa (AsgiSA), and particularly the Joint Initiative on
Priority Skills Acquisition (Jipsa). Under this initiative we successfully ran
a course in 2006 that developed Foundational Project Management skills for a
group of black women municipal officials in collaboration with Old Mutual
Business School. Further public private partnership (PPP) arrangements are
currently explored with Old Mutual as well as other private sector
partners.

AsgiSA has succeeded in sharpening the role of the Community Development
Worker Programme as an agent of the broader endeavour to stimulate the growth
and expansion of local economic development at the grass roots. The programme
is increasingly part of the basket of government interventions that is
addressing the deep-seated economic inequalities amongst the most marginalised
in our country in order that bridges are constructed between our first and
second economies.

In this spirit, community development workers (CDWs) have been trained in
the co-operative working model of business enterprise a model that has been
proven to be a suitable starting point around which communities can organise
their economic activities. As the majority of beneficiaries of the CDW focus
forms part of the second economy, it is understood that the cooperative model
will allow CDWs to link communities to existing broad-based economic
opportunities that flow through the AsgiSA programme of growth and
development.

Obviously, the issues pertaining to adequate and appropriate capacity for
the developing state are ongoing challenges and some of the most serious that
we face as a public service and a country. Therefore in terms of our medium
term perspective we are putting a range of further initiatives in place. The
most important and far-reaching is obviously the transformation of Samdi into a
Public Service Academy.

You may recall that during last year's budget vote I announced the work of
an advisory committee under the Chairpersonship of Dr Vincent Maphai who were
looking at the role and functioning of Samdi. Since then the Committee has
reported to me and the transformation process has proceeded quite rapidly.
Cabinet has given approval for the creation of a Public Service Academy. The
Academy will be a schedule one department, headed by a Director General and
reporting directly to myself. Its goal would be to foster and co-ordinate the
delivery, on a meaningful scale of training in practical management skills for
a developmental state and in the common ethos and values required for a
professional public service.

As such the Public Service Academy has two major objectives: Executive-level
management development for the Senior Management Service (SMS) and
"massification" of middle and junior management training in the public service
up to 500 000 days per year. A further major initiative with respect to
massification will be the induction programme for all new entrants at all
levels, an initiative that has set as its target the induction of 100 000
public servants per year. The Academy's new strategy will embody three main
changes:
* firstly, it would shift from being a provider of training to a facilitator of
training
* secondly, it would move from being a competitor in the provision of training
to collaborating with other service providers and
* thirdly, it would greatly extend its coverage from selective to comprehensive
or 'massified'

The new service delivery model will strengthen partnerships with Higher
Education Institutions and provincial academies to provide quality training
interventions for the senior management in the public service. An important
initiative with respect to human resource development that will come to
fruition in the medium term is the formulation and implementation of the second
Human Resource Development Strategy (HRDS) that will cover the period 2007 to
2014. The formulation of this strategy builds on an extremely thorough review
that was done of the HRDS that covered the period 2002 to 2006. We believe in
order to be successful in capacity building the public service will have to
change its approach to training. It has to become less fragmented and less
prescriptive over the medium term. In turn it must become more
practice-oriented.

Making the public service an employer of choice remains one of our
objectives. To this effect we are constantly looking at areas that will improve
our chances of attracting and holding on to the very best employers. One of the
critical areas is obviously that of remuneration and conditions of service.
Since I have briefed parliament on this matter just last week, I would not like
to spend too much time on this.

Over the longer term we are concerned with the issue of retaining good
professionals and managers for the South African public service, while at the
same time managing personnel expenditure. For this reason we have structured
our offer at the negotiation table in order to support a range of
transformational objectives. The revised salary structures we propose will
result in public servants receiving substantially higher salary increases,
through putting in place proper career pathing models for public servants,
recognising seniority and rewarding performance.

Career pathing models are not automatic salary increases, but forward
looking plans that systematically increase salaries after pre-determined
periods based on specific criteria such as performance, qualification, scope of
work, experience, etc. They will also enable substantial salary increases for
employees who choose to remain in the production levels and not wish to move to
supervisory or management posts.

In terms of recognising seniority, employees with longer service in the
public service will benefit more from this revised salary structures, as the
revised salary structures will differentiate pay of employees with one year
service, from those with five years service, or 10 years, etc. Employees with
longer service will earn a higher salary than employees with one year
experience service; therefore will be better off under this dispensation. A
6,5% general salary increase does not facilitate this differentiation, as it is
an across the board increase.

Furthermore, through these revised salary structures, government recognises
that certain salaries of professionals are inappropriate. For example, a
principal who is managing a school of 1 500+ learners, 55+ educators and has
laboratories and sports field to maintain, is currently remunerated at salary
level 12. We believe that this is inappropriate. Government has therefore
embarked on a process to remunerate these professionals a salary that is
relevant to the complexity of the job and management. Therefore, government is
proposing that the salaries of principals be increased. The increase in salary
will be over and above the general salary increase.

In our opinion by putting the emphasis on a stated percentage on one item
where conditions of service and remuneration frameworks are made up of a
composite of mutually sensitive items will not in the best interest of country
as a whole. It will set in motion inflationary forces which South Africans can
ill afford.

This offer consists of the following:

* A general salary increase of 6,5% for the 2007/08 financial year, which
takes into account average projected interest cost of mortgage bonds (CPIX) for
2007/08 plus a real salary increase.
* A general salary increase of projected CPIX plus 0,5% for the 2008/09
financial year.
* The implementation of revised salary structures (occupation specific
dispensation) for the following professions in this financial year:
* all categories of nurses with effect from 1 July 2007;
* legally qualified professionals in Justice with effect from 1 July 2007;
and
* school based educators and school principals with effect from 1 January 2008
and 1 July 2007 respectively.
* Fast-tracking the implementation of the housing allowance to 1 July 2007,
i.e. increase the housing allowance for renters from R242 to R456 per
month;
* A 25% adjustment to night shift, special and danger allowances;
* The full implementation of the Basic Conditions of Employment Act, where
government will pay double salary (X2) for work performed on Public Holiday and
one and a half (1 ½ X) salary for work performed on Sunday as part of normal
duty.
* A medical subsidy increase from R1 900 to R2 020 for Gems members.

One of the major success stories in this portfolio over the past year is the
Government Employees Medical Scheme or Gems. It has performed beyond our
highest expectations by covering more than 300 000 lives in its first 15 months
of operations. Notable in the Gems success story is the use of multiple media
to communicate with prospective members, responding to phone calls, faxes,
SMSs, e-mails and walk-in visits, addressing a pool of prospective members that
is vast in number, multi-cultural, multi-lingual, and geographically spread in
urban and rural areas across the whole country. Gems will soon be holding its
inaugural Annual General Meeting and will elect a Board of Trustees to continue
to ensure sound corporate governance of the scheme's affairs.

From the citizen's perspective, the State is constitutionally bound to
ensure that services are in fact delivered to them and, that these services are
of a high quality and delivered to their convenience. This challenges the State
to find the most effective methods and channels to deliver these services
within the system of government, but also in creative associations with the
private sector, the non-profit organisation (NPO) sector and the community.

The institutions across the three spheres that comprise the machinery of
state have to be strategically aligned and harmonised to complement one another
so as to more effectively fulfil the needs of South African society. The most
effective use of information and communication technology (ICT) must also be
made. Such arrangements will enhance government's service delivery approach as
one sovereign entity, rather than conceived as separate institutions serving
the people and will bring the most up-to-date technological infrastructure that
we have at our disposal into play in the service delivery equation.

This approach of creating a superbly well-aligned and integrated public
service is underpinned by an effort to create government institutions that are
accessible, efficient, representative, accountable, sustainable and responsive
to service delivery needs. In addition, those providing services should have a
clear understanding of the people, their needs and the services they require
and should be located as close as possible to the people.

To these effects we have done the following:

As part of government's effort to strengthen the capacity and organisation
of the state, the Ministry has conceptualised and is implementing the Single
Public Service Initiative. The initiative seeks to bring together all three
spheres of government into a cohesive set of institutions to integrate and
accelerate service delivery to the poor in South Africa. Legislation has been
drafted and is currently being considered in government before it is presented
to Parliament. Projects to create harmonised norms and standards for the Single
Public Service have been initiated. These include extending and strengthening
initiatives such as that of the Thusong Service Centre Programme and the
Community Development Workers programme.

The Ministry for the Public Service and Administration, which has the
mandate to implement e-Government, has embarked on various transformation
initiatives with a view to modernising its service delivery model for the
benefit of its people. These include: conducting citizen/business research;
developing a next generation e-Government vision, strategy and roadmap;
producing a next generation Sita business, operating and technology model;
conducting rapid prototyping of catalytic projects; developing a national
digital inclusion plan for South Africa; and working toward the development of
an enterprise architecture, among others.

The Next Generation Network project is worth R454 million over five-years
and it represents the largest deployment of Next Generation Network services in
sub-Saharan Africa. Neotel, South Africa's second national telecommunications
operator has been awarded a five-year contract to provide national backbone
transmission services to support the new network. This project obviously
promises greater efficiency and improved services to the government departments
who are Sita clients.

We refuse to become the captive of powerful interests in terms of ICT that
may become contrary to our developmental agenda. We have developed a Free and
Open Source Software strategy through which we intend to bring cost savings in
licence fees in the medium to long term as well as to facilitate
interoperability through the increased use of open standards. Realising that
these are only steps in the right direction, we intend to continue taking steps
which the public experiences government as an integrated entity. To this effect
I would like to point you to the following initiatives that will be undertaken
during the next three years in line with our Medium Term Strategic Plan.

The main thrust of integrated service delivery is the implementation of the
Access Strategy, a package of interventions aimed at expanding citizens' access
to government information and services. The Access Strategy focuses on the
development of infrastructure for integrated service delivery, including the
construction programme for Thusong Centres and the development of ICT
infrastructure at service delivery institutions. A related thrust is the use of
information and communication technology (ICT) in service delivery, which
includes the catalytic projects Track and Trace (to ascertain by SMS progress
regarding an application being processed by a government office); and the
Citizen Relations Portal (where citizens may register complaints by SMS and
obtain feedback on their concerns). Work is currently underway in government to
design and implement these systems. Home Affairs is already piloting the Track
and Trace system.

As the service delivery scenario changes from one of direct delivery by
government to one depending on a combination of delivery mechanisms and
delivery partners the issue of performance management is increasingly moving
centre stage. The work of the Public Service Reform Group of the Policy Network
in the United Kingdom (UK) released in May this year makes two recommendations
with regard to performance management. They state, and I quote:

"Where service delivery is inadequate, the state must act quickly to
sanction under-performance, being ultimately prepared to see poor providers
fail."

"The public should be empowered with high-quality performance data,
alongside trigger mechanisms to ensure rapid intervention in failing public
services."

We have been anticipating the need for stronger performance management
systems across the public sector. To this effect the departments in this
portfolio, together with others have been providing critical support for the
development of a Government-wide Monitoring and Evaluation System and will
continue doing so. We have also developed the Public Management Watch to
pro-actively identify departments facing governance challenges and take
initiatives to support them. Our system of performance management for Heads of
Departments continues to be driven by the Public Service Commission (PSC) and
recommendations have been made with regard to strengthening this system. As
from 1 April 2006 certain amendments have been made to the Performance
Management and Development System for SMS members. These were made in order to
improve the content and application of the system. Cabinet has agreed that
disciplinary steps be taken against Heads of Departments and SMS members who
did not sign their performance agreements for 2006/07 by October 2006.

Performance management takes on different forms and few would disagree with
me that the regular reports the Public Service Commission makes available on
aspects of the South African Public Service are very powerful feedback tools.
They are in the public domain and carries significant weight when it comes to
suggesting corrective action. We are looking forward to receiving all those
reports that are in the pipeline of preparation.

The final theme of our work I wish to touch on is our international
programme. This is a growing and extremely important part of our work. Our
participation in the global knowledge community on public administration and
public sector transformation should come as no surprise. South Africa remains a
very important case study for the world to watch.

Paul Johnson, in his book "Modern Times: A History of the World from the
1920s to the Year 2000" captures this phenomenon as follows, and I quote:

"In many ways, South Africa is a microcosm of the global problems which
confront humanity. There's no other country on earth whose characteristics and
the difficulties they create, are closer to those of the world as a whole." On
the global front of our participation hosting the fifth Global Forum on
Anti-Corruption must have been the highlight. The Forum, held in early April,
was attended by 840 delegates, representing 110 countries. Africa prepared for
its participation by hosting the first Africa Forum on Fighting Corruption at
the end of February 2007 under the theme: "Towards a common understanding of
Corruption in Africa."

Our work in the African continent continues to support our overall
international relations strategic thrust with respect to Africa. With respect
to the African Peer Review Mechanism (APRM) process we are awaiting the tabling
of our report at the June APRM forum of Heads of States in Ghana. After that
the country review report will be published by the APRM continental
Secretariat.

We are continuing to play a very active role in the Pan African Conference
for Ministers of Public or Civil Service. Events and processes to watch out for
in terms of taking forward the agenda of this conference is the Africa Public
Service Day celebrations on Friday, 22 June 2007 and Saturday, 23 June 2007 the
All Africa Public Sector Innovation Awards that will culminate in the first
quarter of 2008; as well as efforts to strengthen the implementation of the
African Public Service Charter across the continent.

This portfolio continues to make stellar progress in building the capacity
of African Management Development Institutes. Samdi is hosting and financially
supporting the secretariat of the African Management Development Institutes
Network (AMDIN), a network that has as its key objective to reinstate African
management development institutes (MDIs) as centres of excellence and worthy
players in the effort to build public sector capacity on the African
continent.

In conclusion, we have achieved much, but the challenges for the remaining
period remain daunting. Succeeding with the transformation of the public
service is critical for the future of the society we attempt to create. As the
Public Service Reform Group chooses to formulate this notion, and I quote:

"Public services are the glue which holds society together, critical for
social cohesion, social solidarity and social justice."

Issued by: Department of Public Service and Administration
5 June 2007