Department of Economic Development and Tourism 2011/2012 Budget Adjustments (Vote 12)
Leader of the Opposition,
Members of the Provincial Parliament,
Director-General and Heads of Departments,
Colleagues and friends,
Citizens of the Western Cape,
I am pleased today to table the adjusted estimates of Vote 12: The Department of Economic Development and Tourism (DEDAT).
Speaker, in the past year this department has redefined its mandate to address the most pressing concern facing our people. To break the cycle of poverty and give our people the chance to live lives they value, we have made growing the economy and creating jobs for all our primary programme of action.
We believe that government's role in achieving this is to create a conducive environment for the private sector to flourish. By increasing their competitiveness in South Africa and in markets around the world, businesses will be able to grow and employ more people. Government must also play its part to ensure that infrastructure is created that enables growth, and that our people are skilled to take up the employment opportunities that are created by additional demand.
In this department's budget vote speech on the 25th of March this year, I announced that an amount of R254 414 million had been set aside for the 2011/2012 financial year. At mid-year, we are adding a net amount of R2 656 million as follows:
In total, R2 706 million has been re-voted to the department. These funds became available as a result of an accumulated surplus declared by Wesgro for the 2010/2011 financial year and will be transferred back to the agency to fund their operations.
An amount of R50 000 was transferred from DEDAT to the Department of Environmental Affairs and Development Planning as part of our contribution towards the Climate Change Conference of Parties (COP17) which is currently underway in Durban.
As a consequence of the revision of DEDAT's strategy, there have been several shifts between programmes within this department. In the main, these shifts see funds saved from administration functions moved toward strategic initiatives that will grow the economy and create jobs.
Funds that were saved due to the late filling of employment posts in the Administration and Integrated Economic Development Services programmes were redirected to the Trade and Sector Development programme to bolster work on our key catalyst projects. These include a telecoms infrastructure project to connect the citizens of the Cape to the World Wide Web, a programme to increase direct air access to our destination to boost business and leisure tourism, the development of a long-term vision and strategy for the future of our province, a plan to redesign of the Port of Cape Town to improve our export capacity, and finally, the building of an IDZ in Saldanha Bay to increase the attractiveness of our destination for large-scale manufacturing concerns.
An additional amount has been shifted from the Business Regulation and Governance programme to the Trade and Sector Development programme so that implementation can begin on "The Fringe". This plan to build a hub for the creative industries in the East City has been further bolstered by our selection as World Design Capital 2014.
In total, DEDAT's infrastructure projects were strengthened by a combined amount of R4.1 million, broken down as follows:
- The Telecoms infrastructure project received R360 000.
- Air Access received R200 000.
- The Port of Cape Town project received R1 755 million.
- Saldanha IDZ received R200 000.
- Future Cape received R1 390 million.
- The Fringe Project received R700 000.
Further savings as a result of the late filling of posts were shifted to Trade and Sector Development to increase transfer payments to the special purpose vehicles that we support to grow our competitive sectors.
During the Adjustment Estimate process the following SPVs were strengthened:
- Clotex was allocated an additional R900 000 to assist SMME clothing manufacturers who are in distress due to the economic downturn.
- The Cape Town Fashion Cluster was allocated an additional R400 000 to develop a branding initiative to encourage all South Africans to wear locally designed and manufactured clothing.
- BPeSA Western Cape was allocated an additional R1 million to bolster the international profile of our province's BPO and call centre industry. This sector currently contributes R6 billion to the province's GDP on an annual basis, and employs around 30 000 people.
In addition to the amounts above that we reallocated to support programmes to grow our businesses and create enabling infrastructure, we also shifted funds to our Skills and Innovation programme to ensure that Western Cape residents are equipped to take up employment opportunities.
- We allocated R200 000 to the Unemployed Youth Development project to give our youth the opportunity to gain hard skills such as bricklaying, tiling, and the laying of laminated flooring.
- We allocated R500 000 to our BPO Skills Development programme to upskill existing senior and junior call centre team leaders.
- We made R500 000 available for a Career Awareness programme that aims to empower youth by providing them with information on career opportunities.
- We have reallocated R150 000 to the Tooling Upskilling project to train lecturers with the latest cutting edge technologies in this sector. Our goal is to provide this service to at least 70% of tooling, dye and moulding firms by the end of 2012.
- We reallocated R3 million to the Premier's Advancement of Youth project. This project will give 1 000 youths the opportunity to gain essential workplace experience by being employed within the Western Cape Government.
- We supported the Cape Town Entrepreneur week with an amount of R200 000. This event, which is hosted in partnership with the City of Cape Town, has been influential in the evolution of Small Business in the Western Cape. It provides a platform for strategic dialogue between entrepreneurs, policy makers and service providers, and helps entrepreneurs gain access to services, support and business opportunities.
- We strengthened our Supplier Development Intervention by an additional R211 000. With these funds, the department, in conjunction with Provincial Treasury, hosted workshops across the province to prepare suppliers and officials for the new BBBEE Procurement legislation which comes into effect from this Wednesday, 7 December 2011.
Speaker, another key component of this department's work is to stimulate growth and jobs through tourism, which currently generates 10% of the region's GDP. Within the Tourism, Arts and Entertainment programme, an additional amount of R 2 999 million was ceded to Cape Town Routes Unlimited (CTRU). Through this funding, we supported key mega events that showcase the province, including the Cape Argus Cycle Tour, ABSA Cape Epic, Cape Town International Jazz Festival, Design Indaba and the J&B Met.
To grow skills in the tourism industry, we strengthened our internship programme for tourism students at Northlink and False Bay Colleges by an additional allocation of R214 000.
The Tourism Infrastructure programme was also strengthened by additional allocations made to the !Kwa ttu and False Bay Ecology Park worth R500 000 and R1 million respectively.
An amount of R467 000 was shifted to the Tourism programme to provide for unforeseen costs related to rental of premises for CTRU.
Speaker, this department has also embarked on a number of special projects to enable people to live better lives.
To eradicate poverty across our province, we believe that people should be enabled to access to the economy through small and informal businesses. We have reallocated an amount of R1.2 million to conduct an investigation on how to grow these sectors. Despite being a rich source of jobs, the Western Cape informal sector remains small, and we are determined to address this to open opportunities for employment for our people. These funds were shifted from the Economic Planning programme, which saw savings as a result of the termination of the Chief Economist and Oversight Committee and LED Spatial projects.
We have also allocated R350 000 to develop and establish a Western Cape Mediation and Arbitration Institute. This institute will provide dispute settlement services to business communities and reduce red tape between businesses.
CASIDRA, which implements projects on behalf of the department, was allocated an additional R500 000 for institutional support.
Under the Business Regulation and Governance programme, an amount of R1 347 million was made available to strengthen the back office operations of the Liquor Board. As we've moved towards the implementation of the new Liquor Act, we have had to significantly ramp up our services to this industry. To ensure that we provide assistance on demand, we have set up a fully fledged call centre staffed by agents who are trained to handle the specific requests of this industry.
Finally, Speaker, additional funding was provided for the content manager system that was not originally budgeted for. This amounted to R234 000.
In conclusion, I would like to thank the staff of this department for the hard work that they have put into developing plans that will tackle poverty head on. Redefining our strategic objective has given us the opportunity to direct funding toward programmes that will work, and revoke funding from programmes that did not deliver measurable outcomes for the citizens of the Western Cape.
We are confident that through building infrastructure that enables growth, assisting our businesses to become more competitive, and upskilling our population so that they can become employed, our people will be able to live lives that they value.
I thank you.