Honourable Speaker,
Honourable Premier of Gauteng Province,
Colleagues in the Executive Council,
Honourable Members of the Provincial Legislature,
Distinguished guests,
Members of the Fourth Estate,
Ladies and gentlemen,
All protocol observed.
Firstly, I would like to wish all Hindu’s celebrating Diwali, the festival of lights a happy and prosperous celebration.
Honourable Speaker, I stood in this esteemed House last year and made a promise, “By the time we table our 2012/13 annual report, you’ll be seeing a decisive turn around in the department’s outlook and orientation.
With the dedication and innovation of our team at the Department of Infrastructure Development (DID), and your support Honourable Members, we are progressively approaching our target of being the “Premier construction entity of the Gauteng Provincial Government”. I believe that during the 2012/13 financial year, the House has seen a decisive turn around in the department‘s outlook and ability to deliver.
The infant Department of Infrastructure Development has grown into our birthright, and the fulfilment of our mandate.
Honourable Speaker, change or rebirth is never a bump free process. Allow me to illustrate the point with the words of Mahatma Gandhi: “Each night, when I go to sleep, I die. And the next morning, when I wake up, I am reborn.”
This is true of the Department of Infrastructure Development (DID), since our inception in 2009 following the disestablishment of the Department of Public Transport, Roads and Works – we have strived to be reborn stronger each day. The decision to have Infrastructure Development as a separate portfolio was informed by the significant role, that the provision and maintenance of public infrastructure plays in the socio-economic development and growth of the Province.
In the years subsequent to this, the newly established Department of Infrastructure Development suffered many birth pains, which resulted in a qualified audit opinion during the 2009/10 financial year with a significant number of matters of emphasis. Over the years the department has suffered several setbacks but we have persevered and have been reborn every day
However – “The phoenix must burn to emerge.” - Janet Fitch. During the 2010/11 financial year the department had decisively begun to move into a new era – moving away from our label as a new or fledgling department. The department is decisively moving towards the attainment of a clean audit in 2014, in fulfillment of our Premier’s commitment to ensuring that Gauteng achieves its target of 100% clean audits by 2014.
During the 2011/12 financial year the department placed strong emphasis on tracking deliverables as part of ensuring that we came up with innovative methods to best deliver services to our people at a much faster pace. Honourable speaker, the sharp increase in our population as a Province, as reflected in the 2011 Census figures meant we had to be innovative and creative in the solutions we implemented to keep up with ever-growing demand for services and infrastructure.
Education
In pursuit of the outcome of achieving quality basic education, during the 2012/13 financial year we completed Orefile and Tsakane Primary Schools. The state of the art, fully resourced Orefile Primary school in Olivenhoutbosch, was constructed in the then record breaking time of less than eight months using Alternative Construction Methods. In the 2013/14 financial year we succeeded in halving this construction time using traditional brick and mortar construction methods.
The department completed 24 palisade fencing projects in various existing schools. 59 Restorative repairs projects were undertaken on schools in order to maintain standards of school infrastructure. Restorative repairs were undertaken to classrooms, administration blocks, ablution blocks and sports facilities.
In order for the Gauteng Provincial Government to achieve its objective of making education a societal priority, 47 Grade R classrooms have been constructed to provide educational facilities to young children.
The establishment of Grade R classrooms provides facilities for the development of early childhood learning. 24 Septic tanks have been installed in schools that are not connected to the Municipal sewer lines. They provide a means of waste disposal on the school’s premises thereby maintaining a healthy environment around the school.
Improved planning of infrastructure projects has been achieved, which in turn ensures that the construction of infrastructure is executed on time, within scale and on budget. Testament to this - is the time taken for the delivery of schools with all amenities has been reduced from between 12-18 months in 2010/11 to 8 months in 2011/12 and in 2012/13 to just 3-4 months.
Green agenda
The position of Gauteng as the center of the Nation’s economic activities has obvious environmental consequences. The Gauteng Spatial Development Framework explicitly recognises the environmental impact of economic activities and the need to address this challenge. In support of this initiative to address environmental concerns as well as urban and inner city renewal programmes (articulated in the Provincial budget speech), the department undertook a research tour of Asia to investigate how Gauteng could benefit from best practices.
Using these lessons, the department is proactively engaging with the Gauteng Planning Commission (GPC) to develop the Gauteng Integrated Infrastructure Master Plan (GIIMP), which will deal with the dual concerns of environmental degradation and equitable growth. Concurrently, the department has embarked on a Green Strategic Programme, which attempts to meet the expectations of the GPG in prioritising the reduction of C02 emissions while creating green jobs within the province.
The Green Agenda concept for the department was formulated in March 2013. Thereafter, the Request for Information (RFI) was advertised and closed on the 2nd of August 2013 for the green agenda concepts. Furthermore an RFP for a Transactional Advisor for Green Agenda was done in conjunction with Gauteng Funding Agency (GFA) and the bid evaluations have been concluded. The Green Agenda Concept includes:
Roof-top Solar PV Rollout Programme
The department has embarked on a project to quantify the usable roof space in all government owned buildings in the Province. It is estimated that all government buildings have approximately 8 million square meters of roof top space that can be used for the mass roll-out of solar panels in the province. If all the available roof spaces could be utilized, up to 300MW of electricity could be generated from government buildings.
We are of the view that a mass roll-out of solar panels in the province can be used to spark a massive demand for the solar PV technologies; which in turn can spark the development of a solar manufacturing industry in the Gauteng Province. Experience gained in South Korea indicates that a solar panel manufacturing facility can be built from a demand of approximately 12MW/month. The potential demand of electricity by DID alone could sustain a standard factory for a period of 2 years.
A pro-bono RFP will be released for the flagship project at the head office for the Department of Infrastructure Development (GDID) (known as Corner House).
Energy Efficiency Retrofit Programme
The department has partnered with ESKOM to conduct energy audits for all GDID owned facilities i.e. Hospitals, Community Health Centres, Provincial Clinics, and Precinct buildings with a view to to retrofit energy efficient technologies in all buildings to reduce energy consumption and energy costs.
Inefficient technolgoies will be replace with HVAC’s, motion sensors and natural lighting where possible. To date, 190 clinics and 15 precinct buildings have been audited. The DoE together with V-NAMA have identified 15 GDID owned facilities where smart metering systems will be installed.
Natural gas
The concept study has been done and feasibility studies have been conducted by iGas to identify the gas pipelines nearest hospitals to hospitals. As part of the process EIAs are also being conducted. The Green Technologies Unit is part of the Inter-Governmental Regional (IGR) forum and has sat in meetings with City of Tshwane, Ekurhuleni, West Rand and Sedibeng District Municipalities in order to consolidate the demand for gas molecules required by the Province.
There are currently 77 boilers in hospitals in the Gauteng province previously fuelled with coal. A retrofit program is underway to replace all boilers with natural gas/diesel boilers. Since natural gas is cheaper, cleaner and more efficient, a trigeneration plant has been proposed for Chris Hani Baragwanath Academic Hospital to reduce the energy costs of the facility. This technology can further be rolled-out to other academic hospitals.
The Green Technologies Unit (GTU) has also formulated a Green Building Policy which was approved by the HoD of Infrastructure Development. The policy will govern the construction of green compliant infrastructure in the Province.
Health
With regard to the maintenance of health infrastructure, Helen Joseph, Tembisa and Kalafong hospitals have been reclassified as academic hospitals. Natalspruit and Zola-Jabulani hospitals will be commissioned in the 2013/2014 financial year.
The implication of these actions for us is to ensure that appropriate capacity is in place to enable these hospitals to service their constituencies seamlessly, thus contributing to the National objectives and Provincial goals as respectively stated by the President and Premier. In this regard, a proactive approach to our maintenance regime and rapid response to breakdowns has been adopted.
Qualified professionals have been deployed as resident engineers responsible for all maintenance activities at Chris Hani Baragwanath Memorial, Steve Biko, Dr George Mukhari and Charlotte Maxeke Academic Hospitals. Reports from hospital Chief Executive Officers (CEO’s) have confirmed the success of this initiative.
The turn-around-times and quality of maintenance have been further enhanced by the e-Maintenance system, which is currently being piloted at Chris Hani Baragwanath Academic Hospital (CHBAH). The pilot study of the e-Maintenance system at CHBAH designed to capture, assign and track reported defects in a paperless environment with artisans accessing the system through their mobile devices is well underway and we are already reaping the benefits.
During the period under review, the department constructed Bertha Gxowa Hospital and refurbished the nurses’ residence at South Rand Hospital. The laundry at Transvaal Memorial Institution was replaced. 27 chillers were installed and used to heat and cool theatres, ICUs, general wards and x-ray departments at a variety of health institutions across the Province. 20 lifts were installed as well as 44 autoclaves.
Thirteen change-over switches were replaced and 12 electrical reticulation projects completed. 22 standby generators were replaced and installed. The department coordinated and facilitated various statutory and mandatory maintenance as regulated by the OHSA of 1993. We conducted 2304 lift, 132 boiler and 101 fire-fighting equipment inspections. 148 contract jobs were created during the implementation of electro-mechanical equipment and plant (project 274).
In order to ensure compliance to our maintenance targets the department is currently implementing the Maintenance Turn-Around Strategy. The aim of this strategy otherwise known as the 24/7/365 strategy is to enable the department to resolve minor breakdowns within a period of 24 hours, major breakdowns that require the appointment of an external service provider within a period of 7 days, and major refurbishments or replacements in a period not exceeding 365 days.
One of critical elements of the 24/7/365 strategy is the provision of tools of trade to all DID artisans including cell phones, toolboxes and vehicles. Last week Thursday, we achieved a significant milestone, the first batch of 52 toolboxes for the artisans at Chris Hani Baragwanath Academic Hospital (CHBAH) was delivered. The rest of the toolboxes for all other regions shall be delivered during this month. DID has invested over R9,659,571 to ensure artisans are fully equipped to carry out maintenance services at health facilities.
In line with the strategy, DID is currently reinstating materials stores to ensure that materials are available 24/7/365 which will enable artisans to conduct minor maintenance within 24 hours; and we are signing service level agreements with a variety of maintenance contractors to ensure that contractors can be appointed to attend to breakdowns in hospitals speedily. DID has reinstated a ‘Boiler Action’ squad that will in future conduct all boiler maintenance activities in house.
Expanded Public Works Programme (EPWP)
The Department of Infrastructure Development is the strategic coordinator of the Expanded Public Works Programme (EPWP) in the Gauteng province and the lead sector coordinator of the Infrastructure Sector. This programme has drawn significant numbers of the unemployed into productive work through short term projects in a manner where they acquire skills while being employed.
The purpose of this programme is to facilitate the implementation of multi-sectoral projects across the province whereby youth, women and people with disabilities in particular are provided with relevant training as well as productive and decent employment opportunities, such that skills and enterprises are developed and sustained, infrastructure developed and local economies enhanced. During the 2012/13 FY, 80 284 work opportunities were provided for youth, 20 266 for women and 82 for people with disabilities.
The Minister of Finance in presenting the 2013/2014 budget clearly stated that social spending is not a substitute for job creation and therefore job creation remains a priority. Hence as part of sustainable development all Government initiatives need to innovatively promote employment creation as an integral part of their daily services to the people.
Furthermore, the National Development Plan has highlighted initiatives such as Expanded Vocational Education as a strategic response to youth employment. The department implements the Expanded Public Works Programme (EPWP), National Youth Service (NYS) and Accelerated Artisan Training Programme (AATP) as platforms to promote skills development and develop work experience.
Honourable Speaker, DID recruited 2 214 NYS beneficiaries and experienced several difficulties related to payment and the provision of training. We have made strong interventions to remediate the situation. It gives me pleasure to announce to the house that the department received the prestigious Kamoso Award from the Minister of National Department of Public Works, Mr. Thulas Nxesi for the Best Department Implementing the NYS Programme in the Infrastructure Sector.
Property management
The department is contributing to the outcome of sustainable human settlements and improved quality of household life through Property Management, in which our strategic objectives are to promote effective and efficient management of the property portfolio with a view to maximising the return on investment.
DID verified and registered 1 224 properties in the Immovable Asset Register. Completed seven User Asset Management Plans (U-AMP) and reviewed 23 lease agreements with a view to charge Market Related Rental (MRR), leased out 14 residential and 17 commercial properties; and also collected R15 million rental income.
The department has been under the spotlight of the Auditor-General, Treasury and the Legislature in respect of charging MRR for the properties under its custodianship. There are approximately 30,000 of such properties. Most of these properties are occupied without valid leases between the state and the tenant, with some occupants not paying any rental whatsoever and others, particularly government officials, paying less than the MRR.
The department is at a fairly advanced stage of a project to rectify this situation. In this process of rectification the DID has been confronted with resistance from some state employees who are of the opinion that the provisions of the Treasury Regulations permit the situation described above.
In April 2013, the department made a significant breakthrough, Treasury Regulations were revised and will come into effect from April 2014 – this will compel all public officials occupying State property to pay MRR. Treasury has also given the department permission to proceed with evictions in the interim.
The Auditor-General found that proper controls were lacking to safeguard immovable tangible assets - to this end the department has engaged in a long term strategy to ensure that the challenges are indeed addressed in a sustainable manner. The department has acquired the services of an external service provider, EYC Consortium, to assist in its Immovable Asset Register Management (IARM) project.
During the process the department will amongst other things, undertake the following: the formulation of applicable policies, procedural standards, processes and guidelines for the effective and efficient management and maintenance of the Gauteng Provincial Government’s property portfolio. The project commenced in July 2013 and will continue until March 2016.
The IARM project comprises seven work-streams in which both EYC Consortium and the Directorate: Government Immovable Assets Management (GIAM) team work as an integrated project team, to facilitate skills transfer. The project also mentors 20 interns who have been brought on board to ensure skills transfer with the intention to absorb them into the department at project closure.
Finance
Total expenditure for the 2012/13 financial year amounted to R1, 408 billion (or 99,8% of the budget allocation of R1,411 billion) of which compensation amounted to R449 million and Devolution of Rates and Taxes amounted to R310 million, thereby representing 54% of the total expenditure.
At the end of the financial year, an amount of R30, 5 million was utilized towards the writing-off of debt from the former Imphophoma, which increased expenditure towards non-APP related activities, and had a negative effect on items requiring funding in relation to the 2012/13 APP. Goods and services were procured according to Broad Based Black Economic Empowerment (BBBEE) targets: 116 contracts were awarded to black owned enterprises, 6 contracts to youth owned enterprises and 81 contracts to women enterprises.
Audit findings
During the 2011/12 financial year, the department had made several gains from the previous audit findings and attained an unqualified audit opinion. A significant achievement was the reduction in accruals, which have been on a steady and commendable downward trend for the previous 3 financial years.
In the 2011/12 financial year, accruals amounted to R 159 million, of which R100 million related to invoices received within the month of March 2012, as the financial year end drew to a close. However the department was by no means performing at an optimal level, the AG raised 39 exceptions, ranging from our human resource practices and policies, to supply chain management and performance management.
During the period under review, the department had a vacancy rate of 42.7%. The high vacancy rate was due to the disestablished Imphophoma entity which still reflected on the organizational structure and vacancies which were no longer aligned to the departmental needs.
The entity had 112 vacancies, whilst the vacancies which were no longer aligned to the organizational needs, amount to 1 364. The total vacancies were 1 476 and only 98 were funded. The department created 188 additional vacancies to increase capacity under the Infrastructure Development Branch, which is a core function of the department.
A total number of 176 candidate technicians were appointed, additional to the staff establishment, with the result that it increased expenditure on the compensation of employees.
The following measures were put in place to reduce the high vacancy rate:
- 98 critical vacancies were identified and are in the process of being filled by 31st December 2013.
- 112 vacancies from the disestablished entities will be abolished.
- The remaining 1 266 unfunded positions, which are no longer aligned to the departmental needs, will be abolished.
When I joined the department in 2012, I commissioned an internal audit of the department to assess the state of readiness for the desired level of infrastructure planning and service delivery excellence. Among the recommendations, was a need to review integrated systems, identify and address skills shortages in strategic and operational areas and the institution of a review process regarding the organisational structure.
The organisational structure of the department has been reviewed and aligned to the Infrastructure Delivery Management System (IDMS) model. The IDMS model is our core operating framework, which requires substantive investment in achieving the certification of our professionals with the relevant professional bodies.
Our commitment to strengthen the Country’s technical expertise and bolster the development of scarce skills such as artisans, engineers and technicians, thus radically improving the execution of the construction and maintenance projects we are mandated to undertake is reflected in the resources we have allocated to human capital development within the department.
We have over the past year undertaken a concerted drive to recruit the technical expertise that will enable us to execute the construction and maintenance work we are mandated to undertake on behalf of various client departments.
The department appointed 69 candidate engineers who are not registered due to the difficulties encountered in recruiting registered engineers and other related professionals, such as matching the market related salaries offered to them by private entities.
The department has begun the process of registering them with the relevant professional bodies. A two year mentorship programme has been put in place to assist the candidate engineers to register with the relevant professional bodies.
The department has concluded the process of reviewing the organizational structure and alignment to the Infrastructure Delivery Management System. Gauteng Provincial Treasury, Department of Finance and the Office of the Premier are currently assisting the DID with the finalization of the technical requirements. The department is awaiting confirmation of the budget allocation in relation to the organisational structure.
As part of improving efficiencies Supply Chain Management policies have been developed, and roles of different parties within the value chain clearly defined. The prudent and accountable use of public funds and all resources that are in the custody of the department is also a matter of priority.
In line with the Gauteng Anti-Corruption Strategy adopted by the Province, we will continue to fight corruption and ensure that there is no financial mismanagement and maladministration, by adhering to the prescripts, of the Public Finance Management Act (PFMA). It is thus encouraging that the department has, in the 2012/13 financial year, obtained an unqualified audit, in pursuit of a clean audit, as championed by GPG.
In closing
Honourable Members in the words of the celebrity statistician, Hans Rosling: “To get away from poverty, you need several things at the same time: school, health, and infrastructure - those are the public investments. And on the other side, you need market opportunities, information, employment, and human rights”.
Over the last 4 years, the Department of Infrastructure Development has made consistent inroads to realize these public investments. It has been a bumpy journey but we are committed to accounting to our people to ensure that you see where your Rands are going and what infrastructure is being built.
I thank you!
For enquiries:
Ramona Baijnath
Cell: 071 670 5863
Email: ramona.baijnath@gauteng.gov.za
