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EPWP Progress Report

Public Works Select Committee23 February 2005

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Wide range of programmes established post-1994 (eg Zibambele, Zivuseni, W f W, Gundo Lashu)

Code of Good Practice for Special PWPs gazetted in 2002

Cabinet review of Special Poverty Relief Allocation in 2003

BACKGROUND

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DESIGN OF THE EPWP

Must allow for wide diversity of programmes

Expand best-practice existing programmes

To be sustainable, the EPWP must not be ‘make-work’ – must be ‘economically efficient’ Emphasis on labour-intensive delivery of cost-effective quality

services

To avoid displacement, the EPWP should take place in growing sectors of the economy

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WHAT IS AN EPWP PROJECT? Deliberate attempt by the public sector body to use its expenditure

on goods and services to create additional work opportunities for the unemployed

Workers usually employed on a temporary basis (either by government, by contractors, or by other non-governmental organisations), under EPWP or learnership employment conditions

Workers provided with a combination of work experience and training

Public sector body attempts to define and facilitate exit strategies for workers when they leave the programme – more potential for exit strategies in some sectors than others

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FUNDING

No special fund for EPWP projects

Emphasis is on changing the way in which normal expenditure occurs: Reduces opportunity costs EPWP projects are identified and prioritised using standard processes Mainstreaming labour intensity Government bodies do not get involved in poverty relief projects outside

their core functional areas, BUT National programme with highly decentralised implementation creates

challenges for implementation

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Progress to date

Institutional Structures are in place:

• DG Steering Committee • Sector Coordinating Committees• EPWP Unit in DPW• Provincial Steering Committees• Communication committee with GCIS

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Training programmes

• Training programme for workers being implemented with Dept of Labour funding

• Training of engineers and contractors for labour intensive construction, with Construction SETA (CETA)

• Training of officials to implement the EPWP, with Local Government and Construction SETA’s

• Contractor learnership programme with CETA and Provinces/ Municipalities

• Learnership programmes for social sector programmes with relevant SETA’s are being finalised

• Venture learnerships for economic sector

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Infrastructure Sector

Funding for projects is provided via infrastructure grants directly to provinces and municipalities

Projects are identified planned and implemented by provinces and municipalities in accordance with their Integrated Development Plans (IDP’s)

Role of Department of Public Works: Set the conditions on the grants: use EPWP Tender and Design

Guidelines Training programmes for workers, officials, contractors, engineers,

supervisors Lobby infrastructure players to participate (provinces, municipalities,

water authorities,Transnet, Housing, Eskom, etc) Support to municipalities and provinces Monitor, evaluate and report

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Infrastructure Sector: ProvincesNational Treasury

Province

Provincial Infrastructure Grant earmarked for the EPWP through the Division of Revenue Act and Audited by the Auditor General Provincial

Infrastructure Budget

Infrastructure Budget from Equitable Share

Equitable Share

Other Provincial Expenditure

Department of Public Works Support

to province

Provinces report indicators

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Infrastructure Sector: MunicipalitiesNational Treasury

Municipality

Municipal Infrastructure Grant earmarked for the EPWP through the Division of Revenue Act and Audited by the Auditor General Municipal

Infrastructure Budget

Infrastructure Budget from Rates, levies and Taxes

Rates, Levies and Taxes

Other municipal Expenditure

Public Works

Support to municipality

DPLG

Reporting

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Significance of EPWP Guidelines Use of EPWP Guidelines is a

requirement in the Division of Revenue Act when MIG or PIG funds are used

Provide guidance and contract conditions for municipalities to tender EPWP projects

Endorsed by SALGA, NT and DBSA Makes the use of labour intensive

methods a contractual obligation of contractors

Auditor General audits provinces and municipalities to assess compliance

If municipalities and provinces do not use the Guidelines, EPWP targets will not be reached

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Provinces:• Audit of all provinces done and AG is compiling report• Compliance is poor• Many provinces are doing some labour intensive work

already, but EPWP is about intensifying this

Use of EPWP Guidelines

Municipalities:• Audit not yet started• Compliance expected to be poor for 2004-2005. This was

compounded by introduction of MIG with new procedures

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Labour Intensive Contractor Learnership Programme

1 contractor + 2 supervisors

Initial plan was for 500 learnerships

Due to interest from public bodies was increased to 750

Application to from CETA to DOL-NSF to increase the number further to 1500

Current commitment stands at 950 learnerships and increasing, approx 30 provincial departments and municipalities participating

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LI CONTRACTOR DEVELOPMENT PROGRAMME: ROLES AND RESPONSIBILITIES

Province / municipality

Learner contractor2 learner supervisors

Unemployed EPWP beneficiaries

CETA DPW DOL

ABSA

Trainingproviders for learnerships

Training providers for workers

Mentors forlearners

Mentors for training providers

Training projects

Trainers of trainers

Programme Managementsupport

IDT

CommunityFacilitationSupport

Access tocredit

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The learnership takes approximately 2 years, each learner contractor employs approx 10 workers

Learners graduate with NQF qualifications, able to tender for LI projects issued in terms of EPWP tender and design guidelines

First group of learners in Ethekwini has completed their first project

Ethekwini, Coega, Klipfontein, Nkangala and Mpumalanga learners are on site

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Significance of Labour Intensive Contractor Learnership Programme

Aims to develop 500 sustainable contractors and 1000 highly skilled site supervisors, specialised in labour intensive construction

As part of their learnerships they will implement 1500 EPWP Projects to the value of R1.5 billion

During the implementation of these projects they will employ approximately 100 000 people

These 1500 individuals will continue to execute a large share of EPWP projects after they complete their learnerships, by winning tenders

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Relationships between Provinces and Municipalities

Varies from Province to Province In Limpopo for instance the province has taken the

lead to mobilise all municipalities to participate in the EPWP Contractor learnership programme

However in provinces with large municipalities or Metro’s they act independently

The Provincial Departments of Local Government play a role in implementing the MIG and can therefore also put pressure on municipalities to implement EPWP through the EPWP Guidelines

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Other infrastructure bodies

Housing

Transnet

Water Boards

Mining companies

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Officials:• LGW SETA is funding training of local government

officials, DPW also carried out training of officials

Training

Consulting Engineers:• Have responded well, with professional bodies

supporting the initiative. More than 500 engineers have

been trained to date

Contractors:• Major contractors have not responded well and are being

engaged through professional bodies• Emerging contractors are eager but lack funds. DOL-

NSF-CETA being approached to assist

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• Training programmes in place and training

providers appointed

Training for beneficiaries

• First training programmes have been

implemented on some EPWP projects , challenge

is to have them implemented on all projects

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Provinces• Total Provincial Infrastructure Grant : Approx: R 20 billion

• Targeted expenditure on EPWP projects: Approx R 6.7 billion

• Targeted EPWP Job Creation: Approx 335 000

Municipalities• Municipal Infrastructure Grant: Approx R 25 billion

• Targeted expenditure on EPWP projects: Approx R 8.3 billion

• Targeted EPWP Job Creation: Approx 415 000

Totals:• EPWP Expenditure: R 15 billion

• Job Creation: 750 000

Infrastructure: Five Year Targets

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Infrastructure sector challenges

Many public bodies do not believe they can increase the amount of work they do labour intensively beyond what they are already doing

Wide-spread prejudices against the use of labour-intensive methods in infrastructure

Wide-spread implementation of the EPWP tender and design guidelines would result in a huge increase in employment creation, programme would exceed targets

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Social sector

Initial focus on ECD and HCBC

Challenge is to create a framework to enable the social sector to grow: Still largely in planning and preparatory phase Agreement on a common system of remuneration Improve programme management and reporting systems Put in place all the required unit standards, qualifications and

learnerships Need convincing motivation for increased funding, with

implementation models and expansion plans

Need to mobilise for more rapid expansion: Most highly labour intensive sector High potential for sustainable job creation (200 000 in ECD) Emphasized in 2005 SONA

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Social Sector model

0 1 2 3 4 5 6

YEAR

Unemployed enter EPWP and obtain work experience and training, under special conditions of employment, employed by NGOs / CBOs

Exit EPWP with work experience and qualification in ECD / HCBC Examples of exit strategies

- Further education and training

- Self employment

- Ongoing employment with same employer, at normal conditions of employment

- Employment with a new employer

EPWP

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Environment and Economic Sectors Progress

Environmental sector performing well Challenge is to expand programme into new areas, eg waste

management at municipal level

Economic sector: DTI working on economic sector plan DoL and DPW finalising venture learnerships with Services

SETA DPW lobbying government bodies for roll out of venture

learnerships, based on models such as Limpopo Sakhasonke

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Monitoring Results (2nd Quarter)

Quantitative reports for the first two quarters of 2004:

Indicator Progress*

Number of EPWP projects being implemented or completed

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Expenditure on EPWP projects R 1.4 billion

Gross number of work opportunities 82 200

Net number of work opportunities 75 600

Person-years of work created 19 183

*Excludes social sector and municipalities due to absence of reports

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Progress: involvement of business

Business Trust providing support:

Funding of targeted assistance to national departments

Funding of private sector field teams to support and assist provinces and municipalities to implement their projects in terms of the EPWP

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Challenges (1)

• Many public bodies do not believe they can

increase the amount of work they do labour

intensively beyond what they are already doing

• Wide-spread implementation of the EPWP tender

and design guidelines would result in a huge

increase in employment creation

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Challenges (2)

Challenge: • Audits indicate that not all provinces and

municipalities are complying with the Division of Revenue Act conditions requiring that projects be tendered as labour intensive projects according to the EPWP Guidelines

Recommendation: • Provincial and municipal political leadership to be

mobilised to instruct officials to use the EPWP guidelines when tendering suitable infrastructure projects

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Social sector:

Challenges: • Early Childhood Development (ECD) expansion

dependent on finalisation of overall ECD policy• More work required for finalisation of Home and

Community Based Care (HCBC) enabling framework• Existing budgets do not accommodate large-scale

expansion

Recommendations: • Priority to be given expanding these sectors as stated by

the President to address basic needs and absorb large

numbers of less skilled workers

Challenges (3)

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Conclusions

1. Data for the first two quarters of 2004 indicate that the EPWP will meet its published targets for the year.

2. The EPWP will exceed its targets and expectations if provinces and municipalities can be mobilised to use the EPWP tendering guidelines for suitable infrastructure projects, and if there is a large scale expansion of ECD and HCBC programmes in the social sector.