Film and Publication Board Presentation to the Portfolio Committee on Communications 09 September 2014 1

Film and Publication Board Presentation to the Portfolio

Committee on Communications

09 September 2014

1

Presentation Outline

• Vision, Mission & Values• Historical Perspective• Legal Framework• Regulatory Tools• Governance Structures• FPB Management• Strategic Outcomes • Strategic Priority Programmes 2014-2019• FPB Successes• Current Challenges• Employment Equity• Staff Misconduct Matters • Performance Information Report Quarter 3• Revenue and Expenditure Report: 3rd Quarter 2013-14

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FPB Vision, Mission and Values

Vision Mission Values

“A Leading and Credible Content Classification Authority in South Africa”

“Ensure efficient and effective consumer protection through regulation of media content,, while empowering the public especially children, through information sharing”

• Accountability

• Fairness

• Integrity

• Transparency

•Professionalism

3

Historical Perspective

• Previous Censor Board within the Department of Internal Affairs

• Governed by the Publications Act of 1974 to Censor undesirable content

• 1994 shift from Censorship to Content Classification

• Task Group established to draft legislation to replace Publications Act

• Film and Publications Act no 65 of 1996• FP Act allowed for content classification and

age ratings, only child pornography and bestiality prohibited from distribution

4

Legislative Framework

Statute Area of Governance

Constitution of the Republic of South Africa 1996

Bill of Rights, Rights of Children and child protection

Film and Publications Act no. 65 of 1996 as amended

Creation, possession and distribution of films, games and certain publications

Makes Child Pornography punishable by law (Section 24 (c) )

Public Administration and Justice Act (PAJA)

Public Administration

Classification Guidelines Classification process and age ratings

5

Evolution of FP Act

• Enacted in 1996 to establish the FPB and regulate the creation, possession and distribution of films, games and certain publications.

• Amended in 2009 to among others: – Insert and delete certain definitions– Establish and provide for the powers and duties of a

Council– Provide for the appointment of functions of

compliance officers– Provide for the compositions, functions and

management of the Board– Repeal certain schedules to the Act

• Currently a legislative amendment process is underway to allow for better regulation of online content distribution

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FPB Regulatory Tools

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REGULATIONSREGULATIONS

FILMS AND PUBLICATIONS ACT 1996FILMS AND PUBLICATIONS ACT 1996

Governance Structures

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FPB Management

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FPB Strategic Outcomes: 13/14 – 17/18

Strategic Outcome Description

(SO1) Effective and visible monitoring of industry throughout the entire value chain for the protection of children and adults through information

(SO2) Consumers, general members of the public and industry informed about the mandate of the FPB

(SO3) Effective and efficient management of FPB Operations

(SO4) Revised, effective and innovative regulation of the content distributed online, mobile and related platforms for the protection of children and adults through information

SO5) Expand FPB footprint through effective partnerships and stakeholders in pursuance of our Mandate

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STRATEGIC PRIORITY PROGRAMMES 2014/2019

1. Research, Compliance Monitoring & Evaluation (SO1)

2. High Visibility-High Impact Communications, Stakeholder Engagement & Consumer Education (SO2)

3. Resourcing and Financing Plans and Institutional Reform (SO3)

4. ICT , Connectivity and Digitisation Strategy (SO3) 5. Technology driven content classification (SO4)6. Legislative review (SO4)7. Regional, Continental and International

Partnerships (SO5)

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FPB SuccessesFPB Successes• National, Regional, International visibility• Online Regulation – Agreements with distributors in place

(Altech, Apple, Google) • Our classification processes and governance are more

rigorous and effective due to online submission of games• Financial systems are sound, we had 5 years of unqualified

audit reports.• Reduced the % of appeals to classified material due to

improved operational efficiencies and training of Classifiers• We have developed a training manual for the classifiers

which will be accredited through UNISA as a formal training programme

• Inadequate empirical research and industry-specific expertise

• Proliferation of content on various platforms (local and international), accessible to South African citizens, especially online

• Increase of illegal content and user generated content (especially Child Pornography)

• Cyber-safety as it relates to children

• Inadequate regulatory tools for online content distribution (pending legislative amendments, Online Strategy implementation, ICT tools)

• Limited enforcement of FP Act provisions (inadequate enforcement provisions)

• Reduced funding sources to meet an expanding mandate (Decreased revenue generation due to shift from physical to online distribution)

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Current ChallengesCurrent Challenges

Employment Equity

Occupational Categories

Male Female

TOTALAfrican Coloured Indian White

African Coloured

Indian

White

Support Staff 24 2 1 1 37 0 1 1 67

Senior Management

4 0 0 1 3 0 0 0 8

Executive Management

3 0 0 0 2 0 0 0 5

TOTAL 31 2 1 2 42 0 1 1 80Persons with disabilities

2 0 0 0 0 0 0 0 2

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Staff Misconduct MattersStaff Misconduct Matters1. Misrepresentation of Qualifications – Gross Dishonesty:

– Detected through a credential verification process– Investigated and referred to a Disciplinary Hearing– Employee found Guilty and Dismissed

2. Failure to relocate as per Contractual Obligation + Absenteeism + Misconduct at an Official FPB Function:

– Investigated and referred to a Disciplinary Hearing– Dismissal Finding, employee lodged an appeal and the finding was upheld– Employee referred the matter to CCMA for arbitration – settled “ out-of-arbitration” on

provision that employee receives full pension benefit.

3. Classifier’s Failure to Comply with Requirements for Content Classification at an External Viewing Venue:

– Disciplinary hearing was held , finding was that the FPB was unable to provide evidence to support the allegations

– Ruling – Classifier found Not Guilty of charges

Staff Misconduct Matters...continuedStaff Misconduct Matters...continued1. Theft of Material submitted to the FPB for Classifications + Accessing Viewing

Facilities and Utilising Equipment and Materials without Authorisation:(2 Operations Staff)

– Two employees suspended while allegations were investigated– They were charged and disciplinary hearing was held on the 05 – 22 August 2014– Employees were found guilty on all charges and dismissed with effect from the 25 August

2014

2. Collusion with a service provider + Conflict of interest + Contravention of FPB Fraud Prevention Plan: (Senior Manager & Operations Staff)

– Allegations reported to FPB from a whistle-blower– Allegations currently being investigated through forensic auditors– Outcome still to be determined

3. Non-compliance with SCM procedures and regulations as accountable FPB Official + Irregular expenditure (Executive)

– Investigation report tabled with FPB Council Task Team– Responsible Executive was suspended with effect from 8 August 2014– Charges are being formulated .

Performance Information Report

2013/2014 Quarter 3

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SO 1 :Effective and visible regulation of films game and certain publications throughout the entire value chain to protect children and inform the public

Outstanding deliverables (Milestones)

Challenges andCorrective measures

Overall Comment – Achievement on some of the quarterly performance targets with much emphasis improved rates on compliance and inspections

Draft Regulations implemented On going refinements to the Regulations

75% non- compliance letters issued Lack of capacity

100% non-compliant distributors referred to SAPS

Lack of capacity

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SO: 3 Effective and efficient management of FPB procedures

Outstanding deliverables Challenges/ Corrective measures

Overall Comment : Partial Achievement of targets regarding the governance due to approval processes

Implement new tariffs • Awaiting approval of new Regulations.

Regulation fees: 2% of total revenue generated

• Awaiting approval of new Regulations.

Automation project (Turn Around strategy implementation)

• Investigation of the cancelled Vodacom APN.• Delay with quotes for IS VPN service

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SO4: Ensure effective and innovative regulation of the content distributed on online, mobile and related platforms to protect children and inform the

general public

Outstanding deliverables Challenges/ Corrective measures

Overall Comment : Partial Achievement of targets regarding the governance due to approval processes

Implement training manual • Lack of Internal Capacity to develop a manual

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SO 1: Effective and visible monitoring of films games and certain publications throughout the entire value chain (content creators, producers and distributors of

fpgs) to protect children and inform the general public

Annual Target Q3 Milestone Q3 Performance Status Reason for variance /Percentage if Partially Achieved

Implement Automated processes

System processes • System enhancement including FPB verification module tested internally• System report compiled

None

Conduct OSS industry Audits

Implementation •Classification Governance Framework Implementation In Progress (Phased-approach) •3 Meetings held with distributors and Classifiers in Gauteng

None

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SO 1: Effective and visible monitoring of films games and certain publications throughout the entire value chain (content creators, producers and distributors of

fpgs) to protect children and inform the general public

Annual Target Q3 Milestone

Q3 Performance Status Reason for variance /Percentage if Partially Achieved

Classify 100% of classifiable material submitted

Classify 100% of classifiable material submitted

100% of received material classified

None

Classification Governance review undertaken

Implementation

•Classification Governance Framework Implementation In Progress (Phased-approach)•Standard Operating Procedures (SOP) developed and approved

Finalisation of Penalties and Exemption Committee due to delayed approval of Regulations amendments

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SO 1: Effective and visible monitoring of films games and certain publications throughout the entire value chain (content creators, producers and distributors of fpgs) to protect children and inform the general public


Accreditation of approved Classifiers Training Program

Training on new Manual

•Training conducted on blasphemy and prejudice

•Procurement process conducted and final editing in progress.

•Accreditation process in progress

None

Develop Labelling system

Develop labelling system

•Project plan developed and approved .

Project put on hold due to financial constraints.

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SO 1: Effective and visible monitoring of films games and certain publications throughout the entire value chain (content creators, producers and distributors of fpgs) to protect

children and inform the general public


Identification of Unregistered Distributors = 2000

Identification of unregistered Distributors= 400

• 806 Inspections to unregistered distributors done• 64% of Q2 target

None

Identification of New Distributors 20% of Unregistered Distributors= 400

New Registrations:80

•77 New Registrations •81 Closures Reported

None

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SO 1: Effective and visible monitoring of films games and certain publications throughout the entire value chain (content creators, producers and distributors of fpgs) to protect children and inform the general public

Annual Target Q3 Milestone Q3 Performance Status

Reason for variance /Percentage if Partially Achieved

6000 inspections of existing distributors ( 6000 targeted)

800 targeted inspections

• 1405 targeted inspections

None

Online Inspections: 1500ISP: 1000Social Networks: 150



Capacity reinforced to improve targets

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SO 2: Consumers, general members of the public and industry informed about the mandate of the FPB

Annual Target

Q3 Milestone Quarter 3 Actual Performance


Implement 13/14 Communication Plan

Media Support to Public Dialogues and Outreach Programmes

Media Interviews Conducted on OutreachProgrammes

None

Implement 16 Days of activism media campaign linked to the FPB mandate

Adverts placed in Media and Special Feature

None

Marketing Campaign on Classification Guidelines implemented

Marketing campaign on the classification symbols ended in Q2.

Insufficient for TV ads

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SO 2: Consumers, general members of the public and industry informed about the mandate of the FPB

Annual Target Q3 Milestone Quarter 3 Actual Performance Reason for Variation/ Highlights

Implementation of the approved outreach programme

Multi-Unit Outreach Program Held

Multi Unit Outreach programme held with Compliance division in Newcastle

None

Three Public Dialogues Held

Two Public Dialogues held in Bloemfontein and East London

Third Dialogue shifted to Q4

16 Days of Activism Campaign Outreach held

•Participated in the DWCD’s Young Women Dialogue in support of 16 Days of Activism Against Women and Children Abuse.• Exhibited at the launch of the 16 days Campaign Against Women and Children Abuse.•Exhibited for Johannesburg City Parks World Record Campaign event in support of the campaign.

Multi Unit approach adopted with strategic partners

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SO 3: Effective and efficient management of FPB Operations

Annual Target Q3 Milestone Quarter 3 Actual Performance


Finalise migration to new structure and review it's effectiveness

Review and Analysis of Turnaround structure completed.

• Individual Coaching Program implemented.•Deferred team-based coaching program to Q4•Phase Two Change Management Project – aligned to BPM and Quality Management terms of reference developed.

• Implementation of Change Management Program deferred to 2014/2014 FY

Office infrastructure Office Infrastructure acquired

Contract amendment approved and signed by Department of Public Works. Space Plans developed.

Delay with approval from DPW and Bid Committee

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Reason for variance/Highlights

Implement organisational skills plan

Implement approved FPB skills development plan

•Training Costs for the period = R46 850.00 Educational Assistant support - Program / Project Management & Administrative Management.•Appointment of Compliance Interns for the 2014 Internship Program.

9 Interns appointed and 1 resigned during the year

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Implementation of internal communication plan

Review internal communications plan reviewed

Internal Communications Plan reviewed by staff

None

Implement 13/14 Targets ( IT Strategy Implementation)

IT Strategy Implementation

•IT Strategy approved• Service level management accepted by IT Steering Committee

None

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Integrate FPB Systems

FPB Systems integrated

•Enterprise Content Management has been integrated.• System Integration user requirements developed.• ToR integration of systems has been developed

None

Automation project ( Turn Around strategy implementation)

Implement automation

Draft Online Draft Strategy in place

• Online Monitoring Strategy due for approval

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Service Management Implementation and Review

Risk Strategy and framework approved

Draft Service Level Management accepted by IT Steering Committee

•Finalisation of the Draft SLM and presenting to approval committees

Trends Analysis on Quarterly reporting

Trends analysis developed

Quarterly Trends report completed

None

Draft Risk Management Strategy in placeDraft Strategic and Operational Risk Registers in place

Risk Management Strategy developed

Draft Risk Framework developed

None

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Reason for variance

Update policies and procedures

Policies updated Update policies None

New Strategy approved in 13/14

Review draft incorporating Executive Authority/ NT inputs

Strategy approved by Executive Authority on December 2013

None

90% compliance with SCM policy

SCM Compliance trends report; review SCM policy

100% SCM Compliance achieved; SCM policy reviewed.

None

Asset management

Assets reconciliation reports

All assets were reconciled to the GL on monthly basis.

None

Implement the Governance Framework

Framework and Charters implemented

Terms of Reference approved

None

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SO4: Ensure effective and innovative regulation of the content distributed on online, mobile and related platforms to protect children and inform the general public

Annual Target Q3 Milestone Quarter 3Actual Performance


Develop Online and Mobile Content Regulation Strategy

Online and Mobile Content Regulation Strategy developed

Draft Strategy in place and awaiting Council approval

Strategy costing still to be developed

Join international body for regulation of digital content.

IARC joined and framework implemented

IARC joined Implementation dependent on finalization of framework by IARC

Upgrade Online and telephonic monitoring and reporting tools

Quarterly Reports to INHOPE as per MOU

Referred to SAPS and In Hope RMS: 52 and Online: 2

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SO4: Ensure effective and innovative regulation of the content distributed on online, mobile and related platforms to protect children and inform the general public


Reason for variance /

Roll out 10 industry workshops, 18 parent workshops focusing on online child protection

3 industry workshops, 5 parent’s workshops focusing on child protection

4 Industry workshops and 2 Parent Workshops held

N/A

Info Hub develop and maintain

Pilot information hub

Information Hub drafted and piloted with other units

N/A

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SO 5:Expand our footprint as the FPB through partnership and stakeholder relationships in pursuance of our mandate

Annual Target

Q3 Milestone Quarter 3 Actual Performance

Reason for variance/ Highlights

Implement a Stakeholder Relationship Strategy

Implement stakeholder relations strategy and plan

Quarterly engagement with stakeholders conducted

• Growth in stakeholder development

Convene quarterly stakeholder initiatives

Annual report launch held in October 2013

N/A

Strategic partners initiated

Impact assessment report compiled

Outcomes assessed

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Host 4 Africa/ SADC engagements on cyber safety and FPB mandate related issues

Cyber safety workshop in 1 SADC/ African country

Preliminary meeting held in Botswana to prepare for the 2014 Outreach Program

Present papers in 3 International Seminars

Develop and present 1 Seminar paper

FPB attended and presented the paper at the International Safety Campaign in Cape Town

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Reason for variance /Highlights

Participate in 2 In Hope AGM’s and related platforms

INHOPE AGM FPB attended In Hope AGM in Netherlands

Participate in 4 Local and International Gaming Festivals

Durban International Film Festival

Not applicable for this quarter.

Target achieved in quarter 2

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REVENUE AND EXPENDITURE REPORT: 3RD QUARTER 2013-14

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Table of Contents

oRevenue

oExpenditure

oBudget Report

oReport on Irregular Expenditure

oAdditional Funding Requirements

FPB Revenue Framework

Revenue Report for Q3 ended 31 December 2013

o Grant subsidy R 55,631,000 was received to date from the Department of Home Affairs. The Grant subsidy is being transferred in quarterly instalments of R 20,669,000 at the beginning of each quarter.

o Classification fees of R 6,375,750 were collected during the first three quarters of the current financial year. To date only 30% of projected fees were collected; this is due to a decline in the material submitted for classification.

o Registration fees of R 339,919 were collected during the first three quarters of the current financial year. To date only 24% of projected fees were collected.

o Annual renewal fees of R 195,149 were generated. To date only 26% of projected fees were collected. This is due to an increase in number of distributors closing shop.

o Interest Income amounting to R 15,848 was received to date from short-term investment made during the current financial year.

o Other income collected from during the quarter related to recoveries from staff and income received for Tender purchases, at end of second quarter total amount of R 6,200 was collected.

o 70 % of the overall budgeted income was actually received as at the end of the third quarter.

Expenditure Report for Q3 ended 31 October 2013

o SO1 – Effective and visible monitoring of industry compliance throughout the value chain for the protection of children and adults through consumer education. 50% of the budget has been spent.

o SO2 - Consumers, general members of the public and industry informed about the mandate of the FPB. 78% of the budget has been spent.

o SO3 – Effective and efficient management of the FPB operations. 61% of the budget has been spent.

o SO4 – Effective and innovative regulation of content distributed on-line, mobile and related platforms for the protection of children and adults through consumer advice and information. 56% of the budget has been spent.

o SO5 – Expand FPB footprint through partnerships and stakeholder relations in pursuance of the FPB mandate. 65% of the budget has been spent.

o 54% of the Capital expenditure budget has been spent.o 61% of the administration expenditure has been spent.

Overall, 59% of the expenditure budget was spent as at the end of the third quarter, these amounts include commitments.

Q3 Expenditure Comparison Report 2012 and 2013

OPERATING AND CAPITAL EXPENDITURE2013-14 2012-13 (YTD)

Q3 ACTUALS Q3 ACTUALS % COMMENTS

STRATEGIC OUTCOME 1: EFFECTIVE AND VISIBLE REGULATION OF FILMS, GAMES AND CERTAIN PUBLICATION THROUGH THE ENTIRE VALUE CHAIN (CONTENT CREATORS, PRODUCERS AND DISTRIBUTORS OF FPG'S) TO PROTECT CHILDREN AND INFORM THE GENERAL PUBLIC

R 13 988 984 16 400 961 117%17% increase in prior year was due to classifiers training and strategic partnerships projects which were reallocated to Strategic Objective 5.

STRATEGIC OUTCOME 2: CONSUMERS, GENERAL MEMBERS OF THE PUBLIC AND INDUSTRY INFORMED ABOUT THE MANDATE OF THE FPB

R 9 490 348 12 032 917 127% 27% increase in prior year was due to implementation of integrated media plan.

STRATEGIC OUTCOME 3: EFFECTIVE AND EFFICIENT MANAGEMENT OF FPB OPERATIONS

R 15 470 713 15 608 956 101% 1% increase in prior year was due to full implementation of the turnaround strategy.

STRATEGIC OUTCOME 4: EFFECTIVE AND INNOVATIVE REGULATION OF THE CONTENT DISTRIBUTED ON-LINE, MOBILE AND RELATED PLATFORMS FOR THE PROTECTION OF CHILDREN AND ADULTS THROUGH CONSUMER ADVICE INFORMATION

R 4 911 643 0

0% This is a new Strategic Objective introduced in 2013-14

financial year. The aim of the strategic objective is to focus on online content management and compliance monitoring.

STRATEGIC OUTCOME 5: PARTNERSHIPS AND COLLABORATIONS

R 3 941 138 0

0%

This is a new Strategic Objective introduced in 2013-14 financial year. The aim of the strategic objective is to expand our footprint through partnerships and stakeholder relationships.

CAPEX R 3 096 811 619 699 20%Increase in current year is due to new ICT Infrastructure procured in the current financial year (i.e. backup server and software).

ADMINISTRATIVE EXPENSES R 4 650 343 10 426 743 224%

Increase in prior year was due to new office space and most of the budget items ( i.e. Travel and Accommodation) in administration expenditure were reallocated to Strategic Objective 3 in the current year, hence a decrease in actual expenditure to date in the current financial year.

TOTAL OPERATING AND CAPITAL EXPENDITURE R 55 549 980 55 089 277 101%

Budget Report

Budget Report for period ended 31 December 2013

Report on Irregular Expenditure

Report on Irregular Expenditure

• During the third quarter it was noted that one of our service providers did not deliver services contracted upon, as a result of which, the total amount of R 1 080 000 paid to the service provider was identified as irregular expenditure.

• After internal investigation, it was determined that there was a breach of procurement processes and disciplinary processes are underway.

• Recovery processes were also instituted against the service provider. FPB has since received a written offer of settlement from the service provider.

ADDITIONAL FUNDING REQUIREMENTS

ADDITIONAL FUNDING REQUIREMENTS

a) Organisational Capacity and Capability – R 3 800 000, this once off allocation will be used to resolve current salary disparity; the new packages will be incorporated into the baseline throughout the MTEF.

b) Implementation of Communication Strategy – R 10 300 000, this additional allocation will be used to implement the revised communication strategy during the 2015-2016 financial year. The strategy will be focussing on the implementation of Media Engagement Strategy, Stakeholder Relations, Public Relations and Marketing and Community Forums and Outreaches.

c) ICT Modernisation and Infrastructure Improvement – R 32 400 000, due to the current ICT challenges highlighted above, it is recommended that the FPB improve current ICT infrastructure and optimise its ICT services to meet its business requirement. The additional allocation will be distributed as follows over the MTEF period:

• 2015 – 2016 = R13.8m• 2016 – 2017 = R9.6m• 2017 – 2018 = R4.1m• 2018 – 2019 = R5.3m

THANK YOU

Documents

Film and Publication Board Presentation to the Portfolio Committee on Communications 09 September 2014 1