The Department of Public Service and Administration (DPSA) has confirmed that all government departments will be legally mandated to submit productivity assessment reports from the end of March 2021.

The reports will be assessed according to a tool developed by DPSA, which was approved by the Minister in July 2018.

After Ministerial approval, the assessment tool had been in a trial phase with 25 departments to refine the tool and fix issues before it is officially released to all departments.

South Africa has 46 national government departments.

DPSA productivity and efficiency studies director Ismail Davids confirmed – during a seminar hosted by Development Bank of Southern Africa and the Mesereti Centre of Capacity Development (MCCD) on July 24 – that productivity in a public sector context could not be measured in a traditional manner by considering input and output.

Rather, he said, productivity in the public sector was the sum of efficiency and effectiveness in bringing public value, service delivery and accountability.

The productivity tool developed by the DPSA, in collaboration with various expert stakeholders and government departments, measures productivity according to labour, operations and performance.

To date, Davids said, the biggest challenge with productivity assessment of and reporting by government departments had been the quality of data at their disposal.

He suggested that every department create frameworks for data management and digitise their data capturing and monitoring activities.

Meanwhile, in terms of the productivity of the economy in recent years, government entity Productivity South Africa (SA) chief economist Dr Leroi Raputsoane said South Africa’s output had been growing, albeit at a slow rate of 1% on average a year since 2014 and until this year, when Covid-19 started impacting on the economy.

He explained that the tertiary sector had been growing the most over the last five years, owing to growth in financial services; however, the primary sector – agriculture and mining activities – still accounted for half of the economy’s productivity.

Productivity SA finds that capital productivity has been growing, despite lower levels of capital investment, meaning that money is being used efficiently and effectively.

This while labour use numbers have been growing – more people getting into economic activity – but labour productivity has not been growing in relation.

AUTOMOTIVE PERSPECTIVE

National Association of Automobile Manufacturers of South Africa CEO Michael Mabasa expected new vehicle sales, production and exports to decline by 25% this year, owing to Covid-19 restrictions and impacts.

“This is particularly worrying for an industry that contributes 6.4% of gross domestic product and employs close to 470 000 people.”

Mabasa said South Africa produced 631 983 vehicles last year, of which 387 125 vehicles were exported, valued at about R150-billion.

The automotive industry constitutes about 30% of the overall manufacturing output of South Africa.

South Africa has 41 automotive brands in the market, of which seven produce vehicles in the country, including BMW, Ford, Isuzu, Toyota, Nissan and Volkswagen.

Mabasa said the ability of the automotive manufacturing industry to recover productivity was influenced by the negative projected growth rate for the economy at up to -16%, the unemployment rate exceeding 30%, the severe deterioration of business and consumer confidence, as well as the downgrading of South Africa’s credit rating by ratings agencies.

Up until the outbreak of Covid-19, the automotive manufacturing industry had been steadily increasing its productivity, with the average number of vehicles produced per employee a year standing at 20.9, compared with 18.5 in 2012 and 10 in 1995.

IMPORTANCE OF PRODUCTIVITY

The seminar was intended to investigate how productivity could be improved to mitigate the impacts of Covid-19 and mobilise partnerships for productivity promotion initiatives.

MCCD director Sisa Njikelana said market appetite for productivity services in South Africa was evident and that productivity was a useful management tool.

“The current economic decline has prompted us to provide these services and see if there is a way to further enhance market appetite for productivity services. Historically, South African productivity institutions date back to 1968.

“We need to think outside of the box and start emphasising a paradigm shift in crafting solutions, owing to the pandemic.

“We need an assessment of the status quo of productivity in South Africa. There are challenges on the low levels of productivity, which necessitates a strong need for its promotion, including the unemployment rate and ratings downgrade. Productivity is a premier tool to enhance economic revitalisation,” Njikelana explained.

He added that the difference between public and private sector productivity levels had to be addressed, as the private sector had a much higher level of productivity.

He also pointed to the need for more local research and literature on productivity in South Africa.