National Development Agency 2009/10 Annual Report to The Select Committee on Social Services

National Development Agency2009/10 Annual Report to

The Select Committee on Social Services

Cape Town

08 March 2011

By

NDA CEO: Ms Vuyelwa Nhlapo

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TABLE OF CONTENTS

1. Introduction2. NDA’s Mandate3. Vision, mission and values4. NDA strategic goals5. Key achievements6. Challenges and Intervention strategy7. Financial report8. Analysis of financial performance9. Auditor-General report10. Conclusion

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INTRODUCTION

• The NDA 2009/10 annual report highlights achievements and challenges for the 2009/10 financial year

• In 2009/10 financial year, the NDA managed to receive an unqualified audit report

• The NDA is accountable to parliament through the Ministry of Social Development. The NDA reports to the Ministry via the NDA Board, who is the accounting authority. The Board exercises governance oversight through the following NDA Board sub committees: Management and Finance Committee, Audit & Risk Committee, Human Resources & Remuneration Committee, Project and Programmes Screening and Research and Development Committee

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NDA MANDATE

PRIMARY MANDATE

To contribute towards the eradication of poverty and its causes by granting funds to civil society organizations for the purposes of:

• carrying out projects or programmes aimed at meeting development needs of poor communities; and

• strengthening the institutional capacity of other civil society organizations involved in direct service provision to poor communities

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NDA MANDATE…Conti

SECONDARY MANDATE

To promote:

• consultation, dialogue and sharing of development experience between civil society organizations and relevant organs of the state;

• debate on development policy; and

•the undertaking of research and publication aimed at providing the basis for the development policy

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VISION, MISSION, VALUES

VISION A developing society free from poverty MISSION Facilitate development through targeted grant funding, research and strategicpartnerships VALUES• Integrity• Excellence• Dignity• Partnering• Commitment• Empowerment

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2009/10 STRATEGIC GOALS

GOAL 1: Promote sustainable development

GOAL 2: Promote organisational sustainability, development practice and excellence

GOAL 3: Promote interface between CSOs, research institutions, development practitioners and the state on development issues

GOAL 4: Facilitate research that informs grant-funding decisions, procedures and development policy

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OVERALL ACHIEVEMENTS FOR STRATEGIC GOAL ONE

• A total amount of R111.1 million was disbursed to 396 approved projects

• A total of 77 projects was approved for funding to the value of R95m. The 77 projects included:

- 11 food security projects funded to the value of R13.3 million- 45 income-generating projects funded to the value of R54.2 million- 15 Agriculture and agribusiness projects funded to the value of R23.4

million- 6 networks of NGO’s funded to strengthen capacity of their membership to the value of R3.8million

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KEY ACHIEVEMENTS FOR STRATEGIC GOAL ONE

Strategic Goal One: Promote Sustainable Development

Outputs Achievements for 2009/10

Food Security Projects Funded

•11 food security projects funded to the value of R13.3 million

-3 551 beneficiaries supported through food security projects, including women, youth and people with disabilities

Income Generating Projects Funded

• 45 income generating projects funded to the value of R54.2 million

- 1 761 employment opportunities created through income-generating project

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KEY ACHIEVEMENTS FOR STRATEGIC GOAL ONE-- conti

Strategic Goal One: Promote Sustainable Development


Targeted Agricultural and Agri-business projects Identified and Funded

• 15 Agriculture and Agribusiness projects funded to the value of R23.4 million- 1 071 beneficiaries supported through agricultural and agribusiness projects, including 442 women, 504 men, 125 beneficiaries from incubation centre. This includes 299 youth and 37 people with disabilities

Capacity Building support to funded projects

• 9 SAQA-aligned training manuals developed in specific learning areas relevant to NDA business

•77 Projects approved for funding with Capacity Building elements, including governance, financial management, conflict resolution and marketing

• Draft capacity-building framework developed in consultation with the Department of Social Development

• 6 networks of NGO’s funded to strengthen capacity of their membership to the value of R3.8million

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KEY ACHIEVEMENTS FOR THE STRATEGIC GOAL ONE- contiProvincial Grant Allocation 2009/10

Province Poverty Index Grant Allocation Writeback

Allocation Total Approved

Amount per Province

Total number approved projects

Eastern Cape 20.80 14 839 438 2 669 435 14 137 415

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Free State 7.10 7 041 347 911 202 7 446 406 7

Gauteng 10.50 8 976 639 1 347 552 9 630 126 8

Kwa-Zulu Natal 22.60 15 864 005 2 900 444 19 274 263 10

Limpopo 15.50 11 879 579 2 002 077 14 774 746 11

Mpumalanga 7.90 7 496 710 1 013 872 7 852 903 6

Northern Cape 1.80 4 024 567 231 009 5 630 955 8

North West Province 9.30 8 293 595 1 193 546 8 304 394 8

Western Cape 4.50 5 561 417 577 522 7 619 306 9

National 332 273 1

83 977 297 12 846 658 95 002 787 77 11

KEY ACHIEVEMENTS FOR STRATEGIC GOAL TWOStrategic Goal Two Promote Organisational sustainability, Development practice and excellence


R50 million by 2012 in kind and cash, in addition to government grant

Resource Mobilisation strategy has been developed

• Two MOU’s (Asgisa and Masisizane) were signed with these strategic partners for facilitation and coordination of programmes in rural economic and development zones• Various MOU’s were signed at the level of funded project as part of implementation of funded projects

No cash raised but R40 million raised in kind for projects implementation

Repositioning of the Organisation

• The media profile of the NDA improved as a result of funded projects being profiled in various newspapers, magazines and online media

• Awareness of the NDA increased in communities as community-building initiatives were undertaken through projects launches in five provinces

• Various publications targeting specific stakeholders were produced and distributed extensively

• Strategic partnerships were formed with government, business and civil society organisations elevating the level of engagement

• An integrated marketing and communications strategy aimed at improving the image of the organisation was revised and approved during the 09/10 financial year 12

Strategic Goal Two: Promote organisational sustainability, development practice and excellence


KEY ACHIEVEMENTS FOR STRATEGIC GOAL TWO -- conti

Vulnerable Groups Identified and empowered

Two disabled persons were appointed

The EE plan was approved and submitted to the Department of Labour

• Occupational Health and Safety (OHS) policy developed, approved and

Implemented

• 15 OHS representatives were appointed

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KEY ACHIEVEMENTS FOR STRATEGIC GOAL TWO-- conti



Reduce costs to achieve 65% direct project funding / 35% support and administration costs split

65% of direct project funding / 35% of support and administration costs split was not achieved

Cost reduction strategy drafted

Approved and aligned organisational structure to strategy

• “AS IS” processes for each directorate have been mapped and documented• The “TO BE: processes for the following directorates are mapped and documented:- Finance- Information Technology- Procurement- Research and Development- CEO’s Office (Inclusive of Company Secretary and Legal & Risk Management)- Development Management- Marketing and Communications- Human Resources

Awaiting the outcome and the finalisation of the business process optimisation. The structure design approach and methodology development approved

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Outputs Achievement for 2009/10

Best Practice Policies, procedures and unit strategies

The following policies were approved and implemented:- The Employee Relation Policy- The Performance Management Policy- The Remuneration Policy - The Human Resource Development Policy - The Probation Policy- The Confidentiality Policy- The Occupational Health and Safety Policy- The Talent Management Policy

• A three-tiered performance management system (organisational scorecard, directorate scorecard and employee scorecards) implemented across the organisation• All employees have performance contracts based on the strategic objectives of the respective directorate• Performance appraisals were conducted bi-annually•Training and workshops on performance management conducted to capacitate managers to deal with performance management related issues

• Human resource service level agreement(SLA) template developed and distributed across the organisation 15




Unit Strategies aligned to NDA strategy • The NDA 2010 – 2013 strategy document produced on time for tabling in Parliament

• All unit strategies were approved

Compliance and good governance • Enterprise-wide risk management implemented

• 50% of audit findings addressed

Compliance checklist implemented

Living the NDA values Values have been incorporated in the NDA performance management system

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KEY ACHIEVEMENTS FOR STRATEGIC GOAL THREE

Strategic Goal Three: Promote the Interface between CSO’s, research institutions, development practitioners and the State on development Issues


Sector relevant and recognised plan for dialogue

Draft sector strategy developed and submitted for consultation

Measure efficacy of dialogues facilitated on public policy, grant funding and service delivery issues

Measuring tool is undergoing consultation

Dialogues facilitated on relevant development Issues

A strategic policy dialogue on The Developmental State and The Fight Against Poverty in South Africa was completed

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KEY ACHIEVEMENTS FOR STRATEGIC GOAL FOUR

Strategic Goal Four: Facilitate research that informs grant-funding decisions, procedures and development policy


Functional Database The In-touch database has been approved and installed at the provinces and is operational

Functional Resource Centre • Resource centre material made accessible to staff

• Desktop research on poverty and developmental issues has been continuously disseminated to provinces

Detailed reports of funded projects Impact performance projects visits were done in preparation for the 2010/2011 impact studies

Sector-specific studies National Study on the State of ICT on South African NGO sector was planned and carried out successfully

Documents produced and lessons shared from case studies to influence policy

Two best-practice case studies for funded projects produced18

CHALLENGES & INTERVENTION STRATEGY -- conti

Challenges Intervention Plan

Limited financial resources Resource Mobilisation

Inadequate skills and competencies of NDA staff to provide effective support to funded projects

• Ongoing skills training on financial management and alternative dispute resolution• Training and institutionalisation of results-based monitoring and evaluation framework• Strengthening recruitment and selection process for newly appointed staff• Deploying skills in right positions

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Limited management, institutional and technical capacity of funded projects

• Periodic capacity assessment of all funded projects• Targeted skills enhancement programme for funded projects (Financial management, governance, conflict resolution)• Institutional linkages with expert organisations for skills transfer, coaching and mentorship (ARC, Producers Associations) • Fostering closer relationships with local government, particularly LED desks for ongoing support, oversight and reporting• Financial and non-financial support to CSO national and sectoral networks to provide capacity support to their members

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Inadequate performance monitoring and evaluation of funded projects

• Rigorous implementation and enforcement of annual monitoring plan• Increased resource allocation for project monitoring• Increased frequency of monitoring visits• Dedicated support to funded projects to improve implementation and reporting• Establishing a network of professional volunteers to provide specialist support to NDA funded projects• Evaluation and impact assessment of all funded projects (mid and end-term)

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Summarised Statement of Financial Performance for the year ended 31 March 2010

2010 2009

R RRevenue 161 022 034 163 449 382Grant from Government 144 782 000 136 267 000Interest & Other Income 16 240 034 27 182 382

Expenses 162 298 183 195 428 909

Mandate expenses 89 643 788 120130910 Committed poverty eradication projects 94 689 034 114 236 418

Project Write Backs (12 361 533) (2 818 048) Direct project costs 7 316 287 8 712 540

Administration expenses 72 654 395 75 297 999 Staff costs 46 396 708 43 292 915 Operating leases 5 246 543 5 107 913 Accommodation and travel 4 732 224 3 120 987 Board fees 1 800 038 1 269 137 Consulting and professional fees 2 341 546 5 240 474 Depreciation and amortisation 1 534 898 1 237 816 IT Communications costs 1 770 069 1 376 173 Marketing and communication costs 1 089 994 1 216 973 Office relocation costs 0 2 343 266 Other Expenditure 7 742 375 11 092 345 Net deficit for the year (1 276 149) (31 979 527)

FINANCIAL REPORT: 2009/10

Statement of Financial Position As at 31 March 2010

2010 2009

Assets R RCurrent assetsCash and Bank balances 216 141 107 246 519 366Exchange Receivables 1 299 604 2 049 660

217 440 711 248 569 026Non-current assetsProperty, Plant and Equipment 3 772 133 3 897 568Intangible Asset 1 045 302 1 434 122

4 817 433 5 331 689

Total assets 222 258 144 253 900 715

Liabilities

Current liabilitiesPayables and Provisions 4 431091 6 915 583Short-term employee benefits 3 108 139 2 932 697Provision for Committed projects 150 105 053 179 641 909European Union 22 512 065 21 668 312

180 156 348 211 158 501

Net Assets 42 101 796 42 742 215

IDT establishment fund 40 956 398 40 956 399Accumulated surplus 1 145 397 1 785 816

Total Liabilities & Net Assets 222 258 144 253 900 715

FINANCIAL REPORT: 2009/10---Conti

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Income• Grant received from National Treasury through the National Department of Social Development increased by 6% (R8.5M) • Interest on bank balances went down by 28%( R10,6 million) due to reduction in interest rates and declining cash holdings

Project Commitments • The NDA Board approved 77 projects to the value of R95 million - These projects benefited 7 397 direct beneficiaries, 3 917 of which are women, 3 480 men and 3 532 youth- Projects worth R 12.4million were written back in 2009/2010 mainly due to project related challenges and environmental factors

Admin Expenses• Admin expenses reduced by 3 % from 2009. This reduction is attributable to cost containment measures that were put in place

ANALYSIS OF FINANCIAL PERFORMANCE

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AUDITOR-GENERAL REPORT

For the 2009/10 financial year, the NDA achieved an unqualified report with an emphasis of matter on irregular

expenditure to the amount of R881 819 where proper procurement processes were not followed

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CONCLUSION

The NDA believes that through the successful engagement in

poverty eradication initiatives and the constructive impact it has

on the lives of its beneficiaries, poverty challenge can be

defeated

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Thank You

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