Office of the Director-General I Public Works I CGO I Pretoria

Office of the Director-General I Public Works I CGO I Pretoria
PRESENTATION TO THE SELECT COMMITTEE ON ECONOMIC AND BUSINESS DEVELOPMENT 23 MAY 2018 Office of the Director-General I Public Works I CGO I Pretoria

PMTE: Summary of the Strategic Overview (Part A) 11-40
TABLE OF CONTENTS No. Item Slide 1. Introduction 3 - 10 2. PMTE: Summary of the Strategic Overview (Part A) 11-40 3. PMTE: Programme Performance Indicators (Part B) 41-76 4. PMTE: Links to Long Term Infrastructure Plan (Part C) 77-100 PMTE 2018/19 APP

PMTE AS A LEVER OF CHANGE AND IMPACT
Extent of the PMTE Portfolio Land Parcels – approximately 29k land parcels (approximately 5.4 million hectares) Structures – 93k of approximately 36.8 million m² of floor space Gross deemed cost – R139 billion Accommodation charges collected R4.5 billion Lease Portfolio ex Private Sector Approximately leases occupying 6.3 million m² floor space at an annual cost of R4.2 billion. Construction Projects Pipeline (±R44 billion over MTEF, purchasing power) Effective optimization of portfolio holds extensive benefits and opportunities for Government’s broader developmental agenda and socio-economic transformation in context of: Service Delivery Transformation Job Creation Expenditure efficiency and cost savings By recognising the PMTE as an important socio-economic lever to exert visible impact in driving capital formation, investment growth and social development, the following planning highlights are applicable for 2018/19: PMTE 2018/19 APP

IMPROVING SERVICE DELIVERY
INFRASTRUCTURE DELIVERY In line with Outcome 12: An efficient, effective and development oriented Public Service PMTE continues to invest in National Government’s immovable assets to ensure that the State is able to provide reasonable, functional accommodation to facilitate attainment of the user department’s service delivery objectives. For 2018/19 over R4 Billion has been made available for infrastructure spending (Refurbishments & Capital) on 105 infrastructure projects for various user departments as per the following categories: IMPACT Above enables User Departments to effectively deliver services to the citizens CATEGORIES ALLOCATION 2018/19 POLICE STATIONS R885 mil COURTS R771 mil BORDER POSTS R217 mil CORRECTIONAL FACILITIES R657 mil OFFICE BUILDINGS R656 mil OTHER R952 mil PMTE 2018/19 APP

RURAL DEVELOPMENT Taking Government Services to the People through Government Precinct Development Developments underway: Polokwane: a precinct is being planned to accommodate 3 social cluster user departments. Phase 1: building of 5 000m² to the value of R130 million. A further estimated construction area of m² for expansion. Mbombela social cluster precinct: extent of 6 000m² to the value of R108 million. Secunda social and security cluster precinct: extent of 5 000m² at an estimated capital cost of R65 million. 5 Rural Precincts with an estimated budget of R350 million are earmarked for development by (Mount Fletcher, Howick, Carolina, Makado and Mthatha.) IMPACT Improving service delivery to the people by clustering government service points in rural areas Saving to the fiscus by reducing current lease portfolio by over m² on leased in accommodation PMTE 2018/19 APP

AVAILING LAND Freeing up land for Land Reform, Human Settlements and Agriculture To accelerate the Land Reform and Human Settlement programme, vacant land under DPW custodianship is being analysed for release mainly for Land Reform, Human settlements, Agricultural programmes 37 priority towns situated in the 27 poorest District Municipalities have been identified for the development of small precincts in an integrated initiative with DRDLR. 77 land parcels (more than hectares) have been identified for Human Settlements development throughout the country according to the Human Settlements National Master Plan 46 land parcels (more than hectares) have been identified for redistribution for agricultural purposes. 75 land parcels (more than hectares) have been identified for restitution to claimant communities in conjunction with the State’s Rural Development and Land Reform programme. IMPACT Acceleration of the Land Reform Process and provision of Human Settlements Stimulate Agriculture, Economy and Food Security PMTE 2018/19 APP

TRANSFORMATION EMPOWERMENT
Transformation of the property sector and Empowering SMME’s & BEE All Quotations (<R ) will be awarded to service providers with a BBBEE Level one (1) or two (2) 75% of procurement spend will be awarded to designated groups 30% new leases awarded to BBBEE companies Awarding of long term leases to BBBEE companies The Property Management Empowerment Policy, which focusses on empowering new entrants, SMMEs and black-owned enterprises through specific transformation programmes, was approved in January 2018 and will be implemented during 2018/19. IMPACT Opening up the sector to the previously disadvantaged PMTE 2018/19 APP

TRANSFORMATION EMPOWERMENT
In promoting and supporting transformation, the Department will establish the Property Incubator Programme to empower emerging property practitioners in areas such as: Real Estate Agents for Acquisitions Facilities Management Municipal Accounts Management In Construction Project Management, the Contractor Development Programme has been identified as a critical component for developing emerging contractors and youth empowerment. SKILLS DEVELOPMENT R5 Million has been set aside for the development of an Artisan Development Programme R10 Million has been set aside for training staff on waste separation at source. 33 officials will be trained in biogas, greenhouse gas and energy efficiency during 2018/19. IMPACT Improved capacity and skills relating to the property sector PMTE 2018/19 APP

COST SAVINGS AND FINANCIAL SUSTAINABILITY
Through operations R200 mil savings to be realised through the review of existing private leases Target of 8 million kl of water for 2018/19 Waste Management projects are targeting a saving of 10 % of total current expenditure for 2018/19 in targeted regions. Targeted saving of 150 Million kWh per annum. 65 properties will be made available to the private sector for letting for additional revenue OPERATIONALISATION AND FINANCIAL SUSTAINABILITY PROGRAMME (OFSP) The PMTE needs to embrace an improved operating model with a clear focus on efficiency enhancements and a financial sustainability to better service the needs of all user departments and become less reliant on the fiscus. A dedicated programme (OFSP) has been launched to deliver on this important outcome The PMTE funding strategy will impact on the sustainability of the PMTE as well as the budgets of user departments as the primary clients. The development of a finance model for the PMTE is in an advanced stage and it will together the User Charges Model be implemented during 2018/19. Leveraging and harvesting of the property portfolio for new revenue generating opportunities PMTE 2018/19 APP

COST SAVINGS AND FINANCIAL SUSTAINABILITY
LEVERAGING / HARVESTING IMMOVABLE ASSET PORTFOLIO Disposal non core/high value surplus assets through lease or sale transactions Disposal of residential units not used for specialised services Review the profitability of commercial letting out contracts Sale of Advertising space Commercial occupancy efficiency Expired leases - rationalisation or renegotiation at more beneficial rates Targeting the gradual phasing out of private leases Rating valuations Telecoms point of presence Maximise/optimize value in strategically located assets Disaster recovery/storage facilities (Government/private sector) IMPACT Reduce reliance on the fiscus Crafting of a market niche in support of long term Financial Sustainability PMTE 2018/19 APP

PROPERTY MANAGEMENT TRADING ENTITY
PMTE 2017/18 APP

CONSTITUTIONAL AND LEGISLATIVE MANDATE
Constitutional mandate: The Constitutional mandate is provided for in Schedule 4, Part A, of the Constitution of the Republic of South Africa: Functional Areas of Concurrent National and Provincial Legislative Competence. Legislative mandate The legislative mandates of the Department are underpinned by the following Acts: Government Immovable Asset Management Act, 2007 (Act No. 19 of 2007); Construction Industry Development Board Act, 2000 (Act No. 38 of 2000); Council for the Built Environment Act, 2000 (Act No. 43 of 2000); Professional Council Acts that regulate the six Built Environment Professions (BEPs); The Agrément South Africa Act, 2015 (Act No. 11 of 2015); Public Finance Management Act, 1999 (Act No. 1 of 1999). (Other Acts are listed in Annexure A of the Strategic Plan and Annual Performance Plan) Policy mandates DPW White Paper: Public Works, Towards the 21st Century, 1997 DPW White Paper: Creating an Enabling Environment for Reconstruction, Growth and Development in the Construction Industry, 1999 Construction Sector Transformation Charter, 2006 Property Sector Transformation Charter, 2007 DPW Broad-based Black Economic Empowerment Strategy, 2006 Property Management Strategy on BBBEE, Job Creation and Poverty Alleviation, 2007 Green Building Framework, 2011 PMTE 2018/19 APP

Convenient access to dignified public services.
STRATEGIC OVERVIEW Convenient access to dignified public services. Effective management of the State’s immovable assets to contribute towards economic and social development and transformation of the built environment. ●Innovation ● Integrity ● Motivation ● Professionalism ● Accountability ● Results-orientated ● Teamwork To support service delivery in a smart, proactive and business centric manner that is aligned to statutory requirements To increase the value of the State’s immovable asset portfolio To develop accommodation solutions for User Departments in collaboration with the relevant spheres of Government To ensure that the User Asset Management Plans (U-AMPs) are produced in compliance with relevant prescripts To inform asset management decisions through optimal investment solutions. To manage the performance of the immovable asset portfolio so as to ensure appropriate investment decisions To direct precinct planning and development for national government in urban and rural areas To develop detailed construction plans that direct the execution of construction projects To ensure that construction programmes are implemented according to approved criteria Vision Mission Values Goals Directly: Outcome 7: Comprehensive rural development and Outcome 12 : An efficient and effective development-oriented Public Service Support: Outcome 6: An efficient, competitive and responsive economic infrastructure network, Outcome 10: Protected and enhanced environmental assets and natural resources and Outcome 8: Sustainable human settlements and improved quality of household life. To consolidate user demands that enables planning and budgeting To meet user departments accommodation requirements as per the approved Infrastructure Programme Implementation Plan To provide functional leased accommodation for user departments To provide a compliant internal control and financial service To provide quality accommodation and contribute to the financial sustainability of the PMTE To provide reliable immovable asset information that informs investment decisions and portfolio management To ensure optimal performance of the State’s immovable asset portfolio To provide a compliant Supply Chain Management service To maintain a compliant Immovable Asset Register (IAR) To manage maintenance programmes in accordance with an approved plan To optimise the utilisation of State owned buildings To provide guidance and support to other custodians in the compilation of compliant Immovable Asset Registers To ensure resource efficiency in State-owned buildings Strategic Objectives PMTE 2018/19 APP

ALIGNMENT TO THE MEDIUM TERM STRATEGIC FRAMEWORK
Links to Government-wide plans (Section 5.1 and 5.2): No changes to the MTSF (and NDP targets) Medium Term Strategic Framework (MTSF) Outcome 6: An efficient, responsive economic infrastructure network Outcome 7: Comprehensive Rural Development Outcome 8: Sustainable human settlements and improved quality of household life Outcome 10: Protected and enhanced environmental assets and natural resources Outcome 12: An efficient and effective development-oriented public service PMTE 2018/19 APP

SONA 9 POINT PLAN Implementing the directives of the State of the Nation Address - SONA 9 POINT PLAN (Section 5.3): 1. Resource Savings: (a) Energy Efficiency – The PMTE will upscale its Green Building Programme. This includes the implementation of Solar PV Projects, Biogas, Waste-to-Energy opportunities, Solar Hot Water, Cogen as well as entering into critical partnerships with other Government Departments, agencies, Green Building Council of South Africa to initiate new projects (b) Water Efficiency - Focus within the programme will be on an audit of current utilisation, baseline calculations, water efficiency measures, operational and maintenance procedures to ensure that water savings are realised (c) Waste Management – Waste Management will continue to be rolled out at Regional Offices. The PMTE aims to reduce the monthly refuse tariff paid to municipalities for all State-owned facilities by 10% by implementing waste separation at source projects. (d) Telemetry Services - Through the use of the telemetry solution, the PMTE will be in a better position to proactively manage its immovable asset portfolio and improve the monitoring and reporting of savings to be realised by the green building programmes. 2. Transformation of the property and construction sectors: (a) Property Empowerment - The PMTE will promote transformation and skills development through the implementation of the Property Empowerment Policy and adhering to the new sector codes to accelerate change in racial and gender composition within the property sectors. PMTE 2018/19 APP

SONA 9 POINT PLAN Implementing the directives of the State of the Nation Address (SONA 9 POINT PLAN) continued… (b) Job Creation: The PMTE will continue to implement EPWP principles within the construction and maintenance programmes, which are expected to contribute to the creation of approximately EPWP work opportunities in 2018/19 financial year and work opportunities over the MTEF. The PMTE will engage with national departments to participate in skills development programmes such as “War on Leaks” Programme with the DWS. (c) Promoting the development of SMMEs: In order to promote transformation within the built environment and to ensure inclusive economic growth, the PMTE will leverage all procurement spend to advance designated groups as categorised in the Preferential Procurement Regulations, The local beneficiation policy will improve socio economic infrastructure with emphasis on the use of local content and local companies. The PMTE will also continue implement the Incubation Programmes by identifying emerging contractors, providing support and any other feasible interventions necessary to advance them. 3. Operations Phakisa Oceans Economy: It is envisaged that the letting out of State-owned coastal properties will create over 1000 stable jobs directly linked to approved projects and influence the creation of over 2000 work opportunities through secondary activities linked to our identified projects. The PMTE is working closely with the Department of Planning, Monitoring and Evaluation to finalise the Operation Phakisa: Oceans Economy Small Harbours and Coastline Delivery Laboratory proposal document. PMTE 2018/19 APP

PART A: SITUATIONAL ANALYSIS
External Environment (Section 7.1): Economic overview: The high government debt has resulted in high debt servicing costs, claiming 11.2% of overall government expenditure and 3.5% of GDP; which is the highest seen in 11 years. This also puts more pressure on Government to engage in revenue generation and collection initiatives which will create additional revenue streams, that is, beyond the traditional revenue from tax collections. Labour market overview: The unemployment rate was estimated at 26.7% as at the end of the fourth quarter of 2017, which is a 1% decline from the previous quarter. In comparison to the same period last year, the unemployment rate increased by 0,2% which is still a concern given the existing trade-off between employment and economic growth. Built Environment Professional Councils: In general, the professions in this industry are still white and male dominated. Men account for 89% and 77% of all registered professionals and candidates respectively. Whites account for 72% and 56% of professionals and candidates respectively. The number of candidates registered are a slight improvement in terms of equality when compared to the differences in the number of professionals. Overview of the property and construction sectors: Rental growth has been slightly low in the last quarter of 2017, with office rental estimated at 2% year on year. Given the current economic climate, vacancy is likely to persist in the short term, which will further exerts downward pressure on market rentals. Although the growth in the construction sector has been subdued, there are a number of initiatives which are expected to improve growth in the sector. The increase in social infrastructure spend by government creates an opportunity for growth in the sector. Given, the recent GDP growth rates and moderate inflation, the sector can expect positive growth in the near term PMTE 2018/19 APP

External factors influencing service delivery (Section 7.2): Constrained financial position of the PMTE: The accommodation charges currently being recovered from user departments is inadequate to fund the upkeep of entire portfolio. This has resulted in a repair and refurbishment backlog and consequently to the deterioration in the condition of property portfolio. The financial impact of addressing the condition of the portfolio to an acceptable level to operate in a sustainable manner will be significant to the PMTE. Reduction in infrastructure budgets: The austerity measures implemented by the National Treasury have impacted the infrastructure programme of the PMTE and user departments. This has led to capital infrastructure budgets being severely reduced requiring a prioritisation of future infrastructure projects and negatively impacting the roll out of the infrastructure programme. Revenue generation and cost saving initiatives: The PMTE will be developing a revenue generating strategy that will ensure the future financial sustainability. This will address the current liquidity gap including the reduction in the bank overdraft. The PMTE will continue to implement specific cost containment measures on the procurement of goods and services, consumption of water and energy, marketing of non-core and non-strategic vacant State-owned properties at market-related properties for letting to private tenants, lease renegotiations, ensuring implementation of debt collection. Containing the costs of leased accommodation: The National Treasury has approved a deviation for the renegotiation of leases that will target landlords on a portfolio by portfolio basis to reduce cost. To this end, the PMTE is in the process of renegotiating leases with the landlords to bring about the required savings to the fiscus. PMTE 2018/19 APP

External factors influencing service delivery……. Managing the increasing cost of maintenance and new construction activities: Costs related to maintenance and new construction activities have continued to rise. In an effort to reduce the costs related to maintenance and new construction activities the PMTE will continue to improve on the turnaround time for finalising plans, designs and drawings in ensuring that projects move efficiently to construction stage in the value chain. Saving costs through the implementation of the Green Building Framework: The PMTE will develop, maintain and operate State- owned buildings to reduce the impact on the environment, including energy efficiency and water savings. The Green Building Policy also lays the basis for job creation (green jobs), growing the Green Building economic contribution, up-skilling and training of participants and contributing to local manufacturing. Transformation of the construction and property sectors: Through the implementation of the Property Empowerment Policy, the PMTE aims to address the skewed patterns of ownership and break the inequitable access to property opportunities; actively directing the advancement of entities majority black-owned, managed and controlled; whilst creating an enabling environment and support for black-owned property enterprises. The incubator programmes will be optimised to increase access to opportunities in PMTE to Emerging and Medium Enterprises (EMEs) and QSEs. The PMTE will leverage all procurement spend to advance designated groups as categorised in the Preferential Procurement Regulations, 2017. Infrastructure development that promotes labour intensive construction: The focused outcome of infrastructure development is be on job creation, poverty eradication and income generation through an EPWP approach, in the areas of brick laying, painting, plastering excavating, wet services etc. The PMTE has identified mega projects that will have a significant impact on job creation and in consultation with PICC the strategy is being developed to monitor and support these initiatives. PMTE 2018/19 APP

External factors influencing service delivery……. Development of Small Harbours and State Coastal Properties: The PMTE aims to attract investments through the letting out of State coastal property for development. The PMTE will be implementing a Letting Out Framework which will allow for rentals to be based on a percentage of turnover and will also ensure higher revenue generation from State coastal properties. Spatial Targeting to support the National Development Programme: The PMTE will support economic development through infrastructure development in targeted municipalities that are aligned with NDP priorities including Special Economic Zones, Industrial Development Zones, Industrial Corridors, large and small harbours. Precinct Plans will promote safe, secure and accessible Government facilities as well as invariably reduce the leased portfolio and cost towards a Government estate concept whilst moving toward revenue generation. Increasing market opportunities for black industrialists: With an infrastructure budget of approximately R44 billion over the MTEF (incl. user departments), the PMTE can make a significant economic impact not only on the purchasing and bargaining power in terms of materials, but also poverty alleviation in terms of labour spend. As part of the specification within the construction contract, service providers are encouraged to make use of locally manufactured material. The PMTE will therefore leverage its buying power in infrastructure commodity to maximise opportunities for specific designated groups as defined in the Preferential Procurement Regulations Availing property for social-economic development: The PMTE is better positioned to make informed investment decisions and leverage the portfolio for optimum utilisation of its immovable assets having completed the first phase of the Asset Register Enhancement Programme. Available options will include, inter alia, those properties that could benefit Government programmes such as human settlements, land reform and the emerging requirement for student accommodation; as well as availing properties to a variety of emerging entrepreneurs in the construction and property sectors APP 2018/19 PMTE

Internal Environment - Business improvement initiatives within the PMTE: (Section 7.3.1) Operationalisation of the PMTE - The operationalisation of the PMTE, is at the centre of the Business Improvement Programme to institute efficiencies and cost effectiveness in the provision of professional property management services to the State. Phase II of the Turnaround Plan (Efficiency Enhancement) is driven largely by improvements in internal control, management practices and systems. PMTE Finance Model - The development of the Finance Model is underway, which will be used as a tool to analyse and guide the revenue and expenditure components of the PMTE towards financial sustainability over an agreed timeframe. The ideal tariff structure as determined by the User Charges Model will feed into the Finance Model which is currently being designed and implemented. Itemised billing - Further enhancements to the existing IAR are required to improve facilities management and most importantly to implement itemised billing. Itemised billing will be used as the mechanism to recover the true cost of running and maintaining each property based on the appropriate tariff structures determined by the user charges model according to industry standards Trading account overdraft - Historical debts of user departments which are still outstanding due to disputes directly contribute to the PMTE’s inability to eliminate the bank overdraft. While the current planned move for accommodation related charges to be paid in advance should contribute to the reduction in the overdraft, it may not extinguish it. The PMTE will therefore develop a strategy in consultation with the National Treasury to eliminate overdraft within a specified period of time. Business process review - The PMTE Business Process Review has commenced and focusses on the consolidation of all existing business processes in each of the PMTE programmes, evaluation thereof, the mapping of new processes, piloting and eventual implementation. Phase 2 has commenced and will continue during the first part of the 2018/19 financial year, with a focus on the optimisation of processes through benchmarking and piloting, as well as strategy, policy, delivery model and ICT alignment. PMTE 2018/19 APP

Internal Environment - Business improvement initiatives within the PMTE: (Section 7.3.1) Business systems - The PMTE has acquired an ERP system with an integrated end-to-end asset management capability in order to fully manage the property portfolio throughout the asset life cycle - including the immovable asset management, movable assets, project management, lease management, investments, maintenance, disposals, procurement and capital budgeting modules amongst others. Capacitation and professionalization - The PMTE has developed a capacity intervention programme to build technical capacity across core functions of PMTE. This will culminate into a fully operational Public Works Academy. Improvement in audit outcomes - The PMTE will ensure that the IAR is thoroughly reviewed for validity and accuracy, and to ensure that all GRAP principles are fully adhered to when implementing the accounting policies related to immovable assets. In addition, greater attention will be given to the reporting on predetermined objectives to ensure further improvement in the audit outcome. PMTE 2018/19 APP

Internal Environment - Business improvement initiatives within the PMTE: (Section 7.3.1) Improved Lease Management – The PMTE has been working with the National Treasury in the development of a Leasing and Letting Framework to streamline leases procured at national and provincial levels. The Framework informs the development of standards for leasing and letting in the public sector, to be approved by National Treasury. Total Facilities Management Revamp: In line with the NIMMS requirements, the PMTE launched a Top 300 Programme as an integrated approach to firstly deliver on key facilities management outputs for an initial 300 priority facilities and secondly to pilot the Facilities Management Delivery Model. Supply Chain Management Reforms - The PMTE has therefore been working closely with National Treasury in moulding a new SCM dispensation to ensure a clear differentiation between the core streams for goods and services and infrastructure and property. Expediting infrastructure delivery - The PMTE will focus on establishing capacity to oversee the process, manage backlogs in the planning and delivery phases, and to subject all identified projects to an intensive Monitoring and Evaluation (M&E) process. The PMTE has also been utilising implementing agents to reduce the workload of project managers and fast-track the delivery of construction projects (capital and planned maintenance). Vesting and endorsement of title deeds: The PMTE will continue to present vesting applications to the Provincial State Land Vesting and Disposal Committee and manage the applications to the Office of the State Attorney to endorse the Item 28(1) Certificates on the title deeds at the Registrar of Deeds. The PMTE will expedite the vesting of approximately properties into the name of the National Government PMTE 2018/19 APP

Internal Environment - Business improvement initiatives within the PMTE: (Section 7.3.1) Componentisation of the IAR: Further enhancements to the existing IAR are required to support the PMTE to improve facilities management and most importantly to implement itemised billing. The next important steps for the PMTE is the physical verification and detailed technical analysis to assess the condition of the assets portfolio at a sub-component level and link the results of the assessment to the existing information on individual properties in the IAR Rural Precinct Development: The objective of the Rural Precinct Development Programme is to re-address spatial imbalances by integrating Government infrastructure planning to create efficiencies for planning and directing government spending through concentration in government precincts. Water Management: The PMTE has an extended responsibility to provide Water and Sanitation Services to all buildings/facilities that not connected to the Municipalities’ water infrastructure in different Provinces across the country. These facilities are mainly installed and operated at Correctional Services Centres, Border Management Agency, South African Police Services and South African Defence Force bases throughout South Africa. Implementing Energy Efficiency measures for State-owned Properties: Green Building interventions designed to reduce resource consumption within Government buildings. The components of the Programme include: Energy Savings, Renewable Energy Funding & Delivery Mechanism, Measurement & Verification (M&V) of shared energy savings contracts, Condition assessment of boilers and the implementation of Green Building Flagship Projects in existing buildings. PMTE 2018/19 APP

Internal Environment - Internal policies, processes and systems (Section 7.3.2) Development of an end to end procurement system: Efforts will be intensified to mature the blue print and finalise the customisation of the electronic system to enable online bid invitations, submission and receiving of bid offers, evaluation of offers, awarding of contracts as well as electronic monitoring of contracts. Implementation of the NIAMM Framework: The recently approved NIAMM Framework comprising, inter alia, of a maintenance standard, accounting framework and planning guidelines will be adopted as the yardstick by which the sector will address the maintenance of immovable asset portfolios. Implementing of the leasing and letting framework: The implementation of the leasing and letting framework and standards will enable the PMTE to significantly improve its delivery timelines in providing leased accommodation to user departments resulting in improved service delivery Development of a Client Management Protocol: The envisaged Client Management Protocol, based on the results of the recent client survey, is aimed at streamlining internal and external communication with user departments. This will ensure that a client centric approach is adopted throughout the value chain providing a one stop entry and exit point for user departments thereby eliminating fragmented communication channels. Establish and maintain a register of expropriations: Once the Expropriation Bill is enacted, the PMTE must put in place processes, systems and resources to record expropriations made by all three Spheres of Government and State Owned Entities. PMTE 2018/19 APP

Internal Environment - Internal policies, processes and systems (Section 7.3.2) Roll out of GIAMA through the GIAMA Implementation Technical Committee (GITC): With the progressive implementation of GIAMA since enactment, as overseen by the GITC, the PMTE is establishing a forum to include all national and provincial custodians to ensure a platform for discussion on matters related to custodial responsibilities as prescribed by the GIAMA legislation. Contributions to legislations of other Departments (custodians): The PMTE has contributed to the proposed Foreign Service Bill. The PMTE will also contribute from a custodial perspective to a number of other pieces of legislation such as the Military Conduct Bill. Amendments to SCM Prescripts: The National Treasury is currently finalising a Procurement Bill and amendments to the Supply Chain Treasury Regulations which are envisaged to be fully implemented in 2018/19 financial year. This will necessitate a review and streamlining of all SCM business processes, finalisation of delegations and directives to align to the new regulatory framework(s) PMTE 2018/19 APP

Performance Environment: (Section 7.4) Flowing from the current level of performance of the PMTE and the ultimate intention to be a self-sustaining organisation capable of managing the State’s immovable assets in an efficient, effective and economic manner the service delivery improvement initiatives listed below, and expanded upon in the following subsections have been identified for 2018/19 and related MTEF: Improve participation and reporting on work opportunities created through the EPWP Reducing the delays in the implementation of infrastructure projects Improvements in the leasing-in of accommodation Improvement in the reliability of information relating to the reduction in energy and water consumption Development of a maintenance plan linked to the sub components of the IAR Management and maintenance of a GRAP compliant IAR Support to other custodians on the IAR Support user departments in compilation of User Asset Management Plans (U-AMPs) Enhancement of the Custodian Asset Management Plan (C-AMP) Finalizing the development of the Public Works vacant property strategy, commencing with vacant residential properties and subsequently vacant land Implementation of a Strategic Spatial Development Framework Improvement in the turnaround times for the processing of quotations Improvement in the turnaround time for the processing of bids Improvement in the turnaround times for 30 day payments PMTE 2018/19 APP

Demand for services: (Section 7.5) Demand for new space (Capital) User department Area required (m2) Total needs (capital funds required) 2018/19 2019/2020 2020/2021 MTEF Year 1 requirements MTEF Year 2 requirements MTEF Year 3 requirements South African Police Services R R R R Defence 30 530 R R R R Justice and Constitutional Development R R R R Correctional Services 34 209 R R R R National School of Government 21 000 R R R R Home Affairs 9 565 R R R R Labour R R R R Environmental Affairs 32 557 R R 0 SUM TOTAL R R R R PMTE 2018/19 APP

Demand for services: (Section 7.5) Demand for new space (Leasing) User department Area required (m2) Total needs (Leases funds required) 2018/2019 2019/2020 2020/2021 MTEF Year 1 requirements MTEF Year 2 requirements MTEF Year 3 requirements South African Police Services 58881 R R R R Rural Development and Land Reform 12600 R R R R Health 1949 R R R R Military Veterans 920 R R R R Justice and Constitutional Development R R R R Home Affairs 141128 R R R R Labour 27180 R R R R Agriculture, Forestry and Fisheries 9 284 R R R R SUM TOTAL R R R R

SUMMARY OF LAND PARCELS PER PROVINCE
CORRECTIONAL SERVICES DEFENCE HOME AFFAIRS JUSTICE AND CONSTITUTIONAL DEVELOPMENT OFFICES SA POLICE SERVICES OTHER TOTAL NUMBER OF LAND PARCELS TOTAL VALUE OF LAND PARCELS NUMBER OF LAND PARCELS EASTERN CAPE 79 73 4 146 33 508 1 529 2 372 FREE STATE 101 148 3 213 28 588 1 901 2 982 GAUTENG 22 955 12 69 94 540 1 899 3 591 KWAZULU-NATAL 64 192 111 61 489 6 152 7 072 LIMPOPO 16 339 13 65 29 303 2 169 2 934 MPUMALANGA 124 93 6 9 347 1 518 2 198 NORTH WEST 19 109 8 50 158 1 597 1 970 NORTHERN CAPE 41 547 2 85 10 330 1 149 2 164 WESTERN CAPE 274 853 1 126 72 512 2 201 4 039 TOTAL 740 3 309 52 945 386 3 775 20 115 29 322 INFRASTRUCTURE OTHER INCLUDES VACANT LAND PARCELS TO BE UTILISED TO MEET THE STATE`S SERVICE DELIVERY AND SOCIO ECONOMIC OBJECTIVES TOTAL VALUE OF LAND PMTE 2018/19 APP

SUMMARY OF BUILDINGS PER PROVINCE
CORRECTIONAL SERVICES DEFENCE HOME AFFAIRS JUSTICE AND CONSTITUTIONAL DEVELOPMENT OFFICES SA POLICE SERVICES OTHER TOTAL NUMBER OF BUILDINGS TOTAL VALUE OF BUILDINGS NUMBER OF BUILDINGS EASTERN CAPE 1 365 1 239 23 397 516 2 496 2 185 8 221 FREE STATE 1 245 2 146 6 388 208 2 207 1 887 8 087 GAUTENG 2 360 7 049 49 1 128 2 293 2 502 15 589 KWAZULU NATAL 1 613 1 744 43 614 909 3 017 3 225 11 165 LIMPOPO 128 5 722 98 298 563 1 655 2 208 10 672 MPUMALANGA 1 039 1 529 94 256 515 1 865 5 173 10 471 NORTH WEST 655 1 016 80 162 873 1 417 3 378 7 581 NORTHERN CAPE 419 4 404 53 232 241 1 512 1 813 8 674 WESTERN CAPE 2 739 5 893 2 172 417 1 619 2 641 13 483 TOTAL 11 563 30 742 448 2 727 5 370 18 081 25 012 93 943 ASSET UNDER CONSTRUCTION BUILDINGS CONSIST OF OTHER USER DEPARTMENTS, FOR EXAMPLE, WATER AND SANITATION, HUMAN SETTLEMENTS, ETC. COMPLETED PROJECTS COMPONENTS THE PROPERTY PROFOLIO IS UTILISED TO SUPPORT PMTE`S INVESTMENT DECISIONS IN LINE WITH GOVERNMENT`S SERVICE DELIVERY OBJECTIVES GRAND TOTAL VALUE PMTE 2018/19 APP

Demand for services: (Section 7.5) 8. Urban and rural municipalities targeted for precinct development and current developments 9. Summary of Private Leases per user department PMTE 2018/19 APP

Organisational Environment: (Section 7.6) Key issues relating to the Organisational Structure - The PMTE as it is located within the broader organisational structure of the Department of Public Works. The implementation of the approved organisational structure for both the Department and the PMTE will continue in the 2018/19 financial year and over the MTEF. During this process, the PMTE will take into consideration the restricted compensation budget and ensure that as capacitation takes place, expenditure remains within the allocated budget. Factors within the organisational environment that have informed the Annual Performance Plan - The business model of the PMTE is based on an interdisciplinary approach with greater synergies between the traditional property and asset management functions of the Department of Public Works and an integrated approach to delivery. Functional Heads at Head Office provide strategic direction to Regional Offices through formulating and deploying policies, standard operating procedures and business processes, and implementing systems to support their application. The responsibility and accountability for good corporate governance, compliance, health and safety, security, bid adjudication and other support functions are managed by executing units where these activities take place and where actual controls can be monitored and enforced. PMTE 2018/19 APP

PART A: DESCRIPTION OF THE STATEGIC PLANNING PROCESS
Section 7.7 Policy statement by the Minister of Public Works Presentation of 1st Draft APP Planning for implementation programmes Submission of the 1st Draft Annual Performance Plan to National Treasury and the DPME Organisational Review and Planning Session Submission of the 2nd Draft Annual Performance Plan to National Treasury and the DPME Review of the Annual Performance Plan based on mid term Cabinet Review, SoNA, Budget Vote Speech Review of the final Draft Annual Performance Plan (internal/external) Annual Performance Plan tabled in Parliament Development of operational plans and performance agreements PMTE 2018/19 APP

BUDGET ALLOCATION PER PROGRAMME
Programme Name 2018/19 2019/20 2020/21 R'000 Administration 1,132,878 1,175,241 1,249,350 Real Estate Investment Services 117,792 140,130 149,041 Construction Management Services 318,240 264,689 281,522 Real Estate Management Services 10,475,283 11,003,849 11,575,497 Real Estate Information and Registry Services 108,862 115,859 123,034 Facilities Management Services 3,268,175 3,012,460 3,180,421 Total 15,436,248 15,712,228 16,558,865 Includes recoverable municipal services PMTE 2018/19 APP

BUDGET ALLOCATION PER ECONOMIC CLASSIFICATION
2018/19 2019/20 2020/21 Current R'000 Cleaning & Gardening 292,229 308,594 325,566 Property Rates 1,405,571 1,518,017 1,639,458 Repair 1,267,844 1,001,696 1,056,790 Maintenance 1,361,252 1,437,482 1,516,543 Compensation of Employees 1,593,057 1,698,200 1,808,582 Admin Goods & Services 323,245 344,150 362,828 Turnaround 200,000 - Municipal services recoverable 3,692,659 3,679,668 3,666,723 Municipal services non-recoverable 384,895 415,686 448,941 Operating Leases 4,915,496 5,308,735 5,733,434 15,436,248 15,712,228 16,558,865 Capital Capital non-recoverable (refurbishments) 1,210,205 1,795,130 1,873,605 Capital recoverable (client capital) 3,211,575 3,391,423 3,577,951 Machinery & Equipment 52,342 55,273 58,313 Total 19,910,370 20,954,054 22,068,734 PMTE 2017/18 APP PMTE 2018/19 APP

SALIENT ISSUES ON THE BUDGET
DPW transfer 2018/19 2019/20 2020/21 R'000 Augmentation (98,967) (105,385) (53,000) DPW Capital (BCOCC) (76,000) Annual reduction in the augmentation transferred from DPW to PMTE: The Infrastructure Repair and Refurbishment budget is partly funded by the transfer. This programme aims to maintain, refurbish and upgrade State-owned buildings to an acceptable standard. Insufficient funding to improve the condition of the portfolio will have a direct impact on the PMTE’s revenue generating capability as market related rentals cannot be charged on dilapidated structures. No new infrastructure projects will be initiated during the 2018/19 financial year since the infrastructure programme budget is fully committed in terms of contractors already on site, design teams appointed and other contracts in advanced stages of the procurement processes. Annual reduction of R76 million over the MTEF in the DPW infrastructure (BCOCC) budget: No new projects will be initiated for the BCOCC Infrastructure Programme during the period of budget cuts which will slow down the delivery trend on the infrastructure programme as a whole in subsequent years. Additional funding will have to be made available from the rest of the DPW Infrastructure budget which in turn has an impact on that Programme. PMTE 2018/19APP

PMTE 2017/18 APP

PROGRAMME 1 ADMINISTRATION

Audited/ Actual Performance
2018/19 ANNUAL PERFORMANCE PLAN (PART B – PROGRAMME AND SUB PROGRAMMES) STRATEGIC GOAL To support service delivery in a smart proactive and business centric manner that is aligned to statutory requirements Performance Indicator Audited/ Actual Performance Estimated Performance 2017/18 Medium-Term Targets 2014/15 2015/16 2016/17 2018/19 2019/20 2020/21 Strategic objective: To provide a compliant internal controls and financial services 1. Reviewed PMTE Processes - “As-Is” Business Processes Mapped PMTE Reviewed Business Processes approved 2. Percentage of compliant invoices settled within 30 days 76% (128 262) compliant invoices settled within 21 working days 85% ( ) compliant invoices settled within 21 working days 86% (137 435) 100% ( ) 100% 3. Number of new revenue generation sources incubated 2 4. Number of identified user departments with Itemised billing 10 15 19 22 5. Approved Finance Model Technical solution developed with dashboards Approved Finance Model

2018/19 ANNUAL PERFORMANCE PLAN (PART B – PROGRAMME AND SUB PROGRAMMES) STRATEGIC GOAL To support service delivery in a smart proactive and business centric manner that is aligned to statutory requirements Performance Indicator Audited/ Actual Performance Estimated Performance 2017/18 Medium-Term Targets 2014/15 2015/16 2016/17 2018/19 2019/20 2020/21 Strategic objective: To provide a compliant Supply Chain Management service 6. Percentage of bids awarded within 56 working days of closure of tender advertisement 131 bids awarded for PMTE 18% (45) 31% (91) 40% (67) 60% 65% 70% 7. Percentage of quotations awarded within 30 working days from requisition date 49% (419) 47% (229) 72% (4 326) 75% (4 593) 77% 80% 85% 8. Percentage of procurement spend for bids awarded to designated groups in line with Preferential Procurement Regulations 2017 - (Tenders) 70% (R1,4bn) of procurement spend (Quotations) 70% (R245 ) of procurement spend 75% 9. Percentage of bids awarded to designated groups in line with Preferential Procurement Regulations 2017 70% (184) of tenders 70% (3 906) of quotations awarded to designated groups

2018/19 ANNUAL PERFORMANCE PLAN (PART B – PROGRAMME AND SUB PROGRAMMES)
Performance Indicator Reporting period Annual Target Q1 Q2 Q3 Q4 1. Reviewed PMTE Processes Annually PMTE Reviewed Business Processes approved Pilot Gap Analysis, Delegation Gap Analysis, External Policy Gap Analysis, Internal Policy Gap Analysis, ICT integration, Organisational Design Gap Analysis and Benchmarking completed To-Be optimised Business Processes mapped To-Be optimised Business Processes verified PMTE Reviewed Business Processes approved 2. Percentage of compliant invoices settled within 30 days Quarterly 100% 3. Number of new revenue generation sources incubated 2 - 4. Number of identified user departments with Itemised billing 15 5. Approved Finance Model Finance Model approved Technical Model tested Technical Model approved Revenue sources identified Financial model approved

Performance Indicator Reporting period Annual Target Q1 Q2 Q3 Q4 6. Percentage of bids awarded within 56 working days of closure of tender advertisement Quarterly 60% 7. Percentage of quotations awarded within 30 working days from requisition date 77% 8. Percentage of procurement spend for bids awarded to designated groups in line with Preferential Procurement Regulations 2017 75% 9. Percentage of bids awarded to designated groups in line with Preferential Procurement Regulations 2017

BUDGET ALLOCATION FOR PROGRAMME 1
Administration 2018/19 2019/20 2020/21 R'000 Compensation of employees 901,671 961,181 1,023,658 Admin goods and services 201,207 214,060 225,692 Procurement of Machinery & Equipment 52,342 55,273 58,313 Turnaround 30,000 Total 1,185,220 1,230,514 1,307,663 The spending focus over the medium-term will be on Management Leadership, Operations Support Management, Finance and Accounting Management and Supply Chain Management (SCM). The PMTE will continue to implement business improvement strategies and efficiency enhancement initiatives over the MTEF period. The 2019/20 financial marks the end of Phase ll of the seven-year Turnaround plan and sets the basis for the sustainability and growth of public works. The bulk of the expenditure for Programme 1 is for compensation of employees to fill critical vacancies aimed at rebuilding the PMTE technical and professional capacity

REAL ESTATE INVESTMENT SERVICES
PROGRAMME 2 REAL ESTATE INVESTMENT SERVICES

2018/19 ANNUAL PERFORMANCE PLAN (PART B – PROGRAMME AND SUB PROGRAMMES) STRATEGIC GOAL To consolidate user demands that enables planning and budgeting Performance Indicator Audited/ Actual Performance Estimated Performance 2017/18 Medium-Term Targets 2014/15 2015/16 2016/17 2018/19 2019/20 2020/21 Strategic objective: To ensure that the user asset management plans are produced in compliance with relevant prescripts 1. Number of User Asset Management Plans (U-AMPs) received from user departments 3 42 2. Number of signed off infrastructure worklists - 10 3. Development of Customer Relationship Management Strategy Customer Relationship Management Strategy approved Engagement with internal and external stakeholders Customer Relationship management Strategy reviewed

2018/19 ANNUAL PERFORMANCE PLAN (PART B – PROGRAMME AND SUB PROGRAMMES) STRATEGIC GOAL To develop accommodation solutions for User Departments in collaboration with the relevant spheres of Government Performance Indicator Audited/ Actual Performance Estimated Performance 2017/18 Medium-Term Targets 2014/15 2015/16 2016/17 2018/19 2019/20 2020/21 Strategic objective: To direct precinct planning and development for national government in urban and rural areas 4. Number of Government Precinct Development plans aligned with identified municipal (urban and rural) Integrated Development Plans (IDPs) 5 6 2 3 4 5. Number of sites established for development 1 6. Number of concept designs completed for identified user departments

2018/19 ANNUAL PERFORMANCE PLAN (PART B – PROGRAMME AND SUB PROGRAMMES) STRATEGIC GOAL To increase the value of the State’s immovable asset portfolio Performance Indicator Audited/ Actual Performance Estimated Performance 2017/18 Medium-Term Targets 2014/15 2015/16 2016/17 2018/19 2019/20 2020/21 Strategic objective: To inform asset management decisions through optimal investment solutions 7. Percentage of feasibility studies completed within scheduled timeframes 87 99% (179) 65 backlog feasibility studies completed 82% (230) 85% (192) 90% 8. Percentage of valuations completed within scheduled timeframes 300 72% (218) 83% (290) 85% (177)

Audited/ Actual Performance Estimated Performance
2018/19 ANNUAL PERFORMANCE PLAN (PART B – PROGRAMME AND SUB PROGRAMMES) STRATEGIC GOAL To increase the value of the State’s immovable asset portfolio Performance Indicator Audited/ Actual Performance Estimated Performance 2017/18 Medium-Term Targets 2014/15 2015/16 2016/17 2018/19 2019/20 2020/21 Strategic objective: To manage the performance of the immovable asset portfolio so as to ensure appropriate investment decisions 9. Percentage of responsive disposal requests processed by 31 March 3 3% Disposal Certificates of approval issued within 6 months from date of request (1 of 34 requested land parcels) Backlog disposal certificates approved for 26 land parcels 36% (34 of 95) 50% (85 of 170) 90% 10 Custodian Asset Management Plan (C-AMP) submitted to National Treasury 1 C-AMP approved 1 C-AMP submitted to National Treasury 1 C-AMP submitted to National Treasury 11 Number of facilities performance measured in identified performance areas - 300 478 600 800 900 1 000

Performance Indicator Reporting Period Annual Target Q1 Q2 Q3 Q4 1. Number of User Asset Management Plans (U-AMPs) received from user departments Annually 42 - 2. Number of signed off infrastructure worklists 10 3. Developed Customer Relationship Management Strategy Quarterly Client Relationship Management Strategy approved 1st draft Customer Relationship Management strategy developed 2nd draft Customer Relationship Management strategy developed Customer Relationship Management strategy approved 4. Number of Government Precinct Development plans aligned with identified municipal (urban and rural) Integrated Development Plans (IDPs) Bi- Annually 4 2 5. Number of sites established for development

Performance Indicator Reporting Period Annual Target Q1 Q2 Q3 Q4 6. Number of concept designs completed for identified user departments Bi- Annually 5 - 2 3 7. Percentage of feasibility studies completed within scheduled timeframes Quarterly 90% 8. Percentage of valuations completed within scheduled timeframes 9. Percentage of responsive disposal requests processed by 31 March Annually 10. Custodian Asset Management Plan (C-AMP) submitted to National Treasury 1 C-AMP submitted to National Treasury 11. Number of facilities performance measured in identified performance areas 800 200

Real Estate Investment Services 2018/19 2019/20 2020/21 R'000 Compensation of employees 114,700 122,271 130,218 Admin goods and services 16,721 17,859 18,823 Total 131,421 140,130 149,041 The spending focus over the medium-term will be on facilitating the compilation of U-AMPs with user departments, the development of precinct development plans and concept designs within Planning and Precinct Development. Further focus will be on the completion of feasibility studies and valuations, measuring the performance of identified buildings and compilation of the C-AMP. The bulk of the expenditure within Programme 2 will be for compensation of employees to fill all critical vacancies aimed at rebuilding the PMTE technical and professional capacity.

CONSTRUCTION PROJECT MANAGEMENT
PROGRAMME 3 CONSTRUCTION PROJECT MANAGEMENT

2018/19 ANNUAL PERFORMANCE PLAN (PART B – PROGRAMME AND SUB PROGRAMMES) STRATEGIC GOAL To meet user departments accommodation requirements as per the approved Infrastructure Programme Implementation Plan (IPIP) Performance Indicator Audited/ Actual Performance Estimated Performance 2017/18 Medium-Term Targets 2014/15 2015/16 2016/17 2018/19 2019/20 2020/21 Strategic objective: To develop detailed construction plans that direct the execution of construction projects 1. Number of approved infrastructure project designs 231 225 210 73 83 103 113 2. Number of approved infrastructure projects ready for tender 144 104 128 140 150 3. Number of infrastructure sites handed over for construction 214 145 186 93 105 116 125

2018/19 ANNUAL PERFORMANCE PLAN (PART B – PROGRAMME AND SUB PROGRAMMES) STRATEGIC GOAL To meet user departments accommodation requirements as per the approved Infrastructure Programme Implementation Plan (IPIP) Performance Indicator Audited/ Actual Performance Estimated Performance 2017/18 Medium-Term Targets 2014/15 2015/16 2016/17 2018/19 2019/20 2020/21 Strategic objective: To ensure that construction programmes are implemented according to approved criteria 4. Number of infrastructure projects completed 180 192 182 161 105 116 130 5. Number of infrastructure projects completed within agreed construction period - 125 (65%) 139 (57%) 129 (80%) 84 (80%) 95 (80%) 115 (80%) 6. Number of infrastructure projects completed within approved budget 109 (57%) 129 (53%) 7. Number of EPWP work opportunities created through construction projects 4 343 11 126 8 959 6 000 7 511 8 200 9 020 8. Percentage of infrastructure projects backlogs reduced 73 15% (216) 14% (154) 15% (148) 20% 30% 40% 9. Number of contractors incubated through the Contractor Incubation Programme (CIP) 297

Performance Indicator Reporting Period Annual Target Q1 Q2 Q3 Q4 1. Number of approved infrastructure project designs Quarterly 83 21 32 15 2. Number of approved infrastructure projects ready for tender 128 30 34 3. Number of infrastructure sites handed over for construction 105 20 28 27 4. Number of infrastructure projects completed (cumulative) 50 78 5. Number of infrastructure projects completed within agreed construction period 84 (80%) 44 64 84 6. Number of infrastructure projects completed within approved budget 7. Number of EPWP work opportunities created through construction projects 7 511 1 800 2 000 1 856 1 855 8. Percentage reduction of infrastructure projects backlogs Annually 20% - 9. Number of contractors incubated through the Contractor Incubation Programme (CIP) 297

Construction Management Services 2018/19 2019/20 2020/21 R'000 Compensation of employees 216,656 230,955 245,967 Admin goods and services 31,584 33,734 35,555 Turnaround 70,000 Capital non-recoverable (refurbishments) 1,210,205 1,795,130 1,873,605 Capital recoverable (client capital) 3,211,575 3,391,423 3,577,951 Total 4,740,020 5,451,242 5,733,078 The spending focus over the medium-term will be on the design and implementation of infrastructure programmes for all user departments. The bulk of the expenditure for Programme 3 will be for capital infrastructure. The total current expenditure is expected to reduce over the MTEF as the Turnaround Strategy is planned to be completed in 2018/19 financial year. This funding will be reprioritised to refurbishments in 2019/20 and 2020/21 to uplift the condition of the portfolio. The allocation of R15.4 billion over the MTEF will be prioritised for the completion of infrastructure projects within agreed time and budget, reducing the infrastructure projects backlog and creating work opportunities through the infrastructure programme. No new infrastructure projects will be initiated during the 2018/19 financial year since the infrastructure programme budget is fully committed in terms of contractors already on site, design teams appointed and other contracts in advanced stages of the procurement processes.

REAL ESTATE MANAGEMENT SERVICES
PROGRAMME 4 REAL ESTATE MANAGEMENT SERVICES

2018/19 ANNUAL PERFORMANCE PLAN (PART B – PROGRAMME AND SUB PROGRAMMES) STRATEGIC GOAL To provide quality accommodation and contribute to the financial sustainability of the PMTE Performance Indicator Audited/ Actual Performance Estimated Performance 2017/18 Medium-Term Targets 2014/15 2015/16 2016/17 2018/19 2019/20 2020/21 Strategic objective: To provide functional leased accommodation for user departments 1. Number of lease agreements signed within scheduled timeframes - 20% (1) lease agreements signed within scheduled timeframes 5 Leases signed out of scheduled timeframes 148 extensions finalised. 100 600 430 100 2. Savings realised on identified private leases R100 mil R200 mil R300mil R350mil 3. Percentage of new leases awarded to BBBEE companies 67% (4) 25% (4) 30% 35% 40%

2018/19 ANNUAL PERFORMANCE PLAN (PART B – PROGRAMME AND SUB PROGRAMMES) STRATEGIC GOAL To provide quality accommodation and contribute to the financial sustainability of the PMTE Performance Indicator Audited/ Actual Performance Estimated Performance 2017/18 Medium-Term Targets 2014/15 2015/16 2016/17 2018/19 2019/20 2020/21 Strategic objective: To optimise the utilisation of State owned buildings 4. Number of private leases reduced within the security cluster - 2 4 12 13 5. Percentage increase in revenue generation through letting of State-owned properties (excluding harbour properties) R28 mil R31 mil 10% (R3,1) mil 10% (R6,82) mil 10% 15% 20% 6. Number of identified vacant surplus State-owned properties let out 3 59 60 65 70 7. Number of State-owned properties verified to confirm occupation status 87 400 8. Number of State-owned properties’ occupation status rectified 20 30 40

2018/19 ANNUAL PERFORMANCE PLAN (PART B – PROGRAMME AND SUB PROGRAMMES) Performance Indicator Audited/ Actual Performance Estimated Performance 2017/18 Medium-Term Targets 2014/15 2015/16 2016/17 2018/19 2019/20 2020/21 9. Number of Spatial and Economic Development Frameworks (SEDFs) completed for identified rural coastal towns - 3 3 10. Percentage revenue increase through rentals of state owned small harbour and coastal properties R10 821 759 10% (R1 050 175) 10% 11. Number of work opportunities created through the letting out of State coastal properties and small harbours 1 000 2 000 3 000

Performance Indicator Reporting Period Annual Target Q1 Q2 Q3 Q4 1. Number of lease agreements signed within scheduled timeframes Quarterly (cumulative) 600 162 237 401 2. Savings realised on identified private leases R200 mil - R50 mil R100 mil 3. Percentage of new leases awarded to BBBEE companies 30% 10% 20% 4. Number of private leases reduced within the security cluster Annually 12 5. Percentage increase in revenue generation through letting of state-owned properties (excluding harbour properties) 6. Number of identified vacant surplus state-owned properties let out Bi-Annually 65 33 32 7. Number of State-owned properties verified to confirm occupation status 400 133 266

Performance Indicator Reporting Period Annual Target Q1 Q2 Q3 Q4 8. Number of State-owned properties occupation status rectified Quarterly 20 5 9. Number of Spatial and Economic Development Frameworks (SEDFs) completed for identified rural coastal towns Annually 3 - 3 10. Percentage of revenue increased through rentals of state owned small harbour and coastal properties 10% 11. Number of work opportunities created through the letting out of State coastal properties and small harbours 1 000 250

Real Estate Management Services 2018/19 2019/20 2020/21 R'000 Compensation of employees 66,908 71,324 75,960 Admin goods and services 9,754 10,419 10,981 Turnaround Operating leases 4,915,496 5,308,735 5,733,434 Municipal services recoverable 3,692,659 3,679,668 3,666,723 Municipal services non-recoverable 384,895 415,686 448,941 Property rates 1,405,571 1,518,017 1,639,458 Total 10,475,283 11,003,849 11,575,497 The spending focus over the medium-term will be on providing and managing functional and accessible accommodation for all user departments. The bulk of the expenditure in this programme is spent towards operating leases, property rates and municipal services. The goods and services expenditure for this programme represents 45% of the PMTE’s total spending. Both operating leases and municipal services are funded on a cost recovery basis.

REAL ESTATE INFORMATION AND REGISTRY SERVICES
PROGRAMME 5 REAL ESTATE INFORMATION AND REGISTRY SERVICES

2018/19 ANNUAL PERFORMANCE PLAN (PART B – PROGRAMME AND SUB PROGRAMMES) STRATEGIC GOAL To provide reliable immovable asset information that informs investment decisions and portfolio management Performance Indicator Audited/ Actual Performance Estimated Performance 2017/18 Medium-Term Targets 2014/15 2015/16 2016/17 2018/19 2019/20 2020/21 Strategic objective: To maintain a compliant Immovable Asset Register (IAR) 1. Percentage of approved disposals (in respect of socio-economic purposes) processed for transfer - 16 disposals approved in 2015/16 processed for transfer 70% (10) disposals approved in 2016/17 processed for transfer 80% of disposals approved in 2017/18 processed for transfer 90% of disposals approved in 2018/19 processed for transfer 100% of disposals approved in 2019/20 processed for transfer 2. Percentage of immovable assets updated on the IAR for completed infrastructure projects 100% (70) 100% (161) 100% 3. Number of land parcels vested (confirmation of ownership) 761 775 518 600 800 900 1 000

2018/19 ANNUAL PERFORMANCE PLAN (PART B – PROGRAMME AND SUB PROGRAMMES) Performance Indicator Audited/ Actual Performance Estimated Performance 2017/18 Medium-Term Targets 2014/15 2015/16 2016/17 2018/19 2019/20 2020/21 Strategic objective: To maintain a compliant Immovable Asset Register (IAR) 4. Number of immovable assets physically verified to validate existence 32 677 8 159 7 516 6 300 19 708 24 636 29 562 5. Number of buildings assessed to determine the condition of significant components - 15 031 18 789 22 546 Strategic objective: To provide guidance and support to other custodians in the compilation of compliant Immovable Asset Registers 6. Number of Provincial Immovable Asset Registers assessed for compliance 9 7. Number of National and Provincial Immovable Asset Registers incorporated into the single repository (National Database of State properties) 2 4

Performance Indicator Reporting Period Annual Target Q1 Q2 Q3 Q4 1 Percentage of approved disposals (in respect of socio economic purposes) processed for transfer Annual 80%. - 80% 2 Percentage of immovable assets updated on the IAR for completed infrastructure projects Bi annually 100% 3 Number of land parcels vested (confirmation of ownership) Quarterly 800 200 4 Number of immovable assets physically verified to validate existence 19 708 4 927 5 Number of buildings assessed to determine conditions of significant components 15 031 3 757 3 758 s 3 758 6 Number of Provincial Immovable Asset Registers assessed for compliance 9 7 Number of National and Provincial Immovable Asset Registers incorporated into the single repository (National Database of State properties) Bi-Annually

Real Estate Information and Registry Services 2018/19 2019/20 2020/21 R'000 Compensation of employees 76,466 81,514 86,812 Admin goods and services 32,396 34,345 36,222 Total 108,862 115,859 123,034 The spending focus over the medium-term will be on the maintenance of the Immovable Asset Register (IAR) Programme, which is an important deliverable towards the full operationalisation of the PMTE. The IAR forms the basis for the revenue generation strategy and implementation of itemised billing. The bulk of the expenditure in this programme is spent towards compensation of employees to appoint various specialists to assist in rebuilding the PMTE technical and professional capacity to maintain the IAR. An MTEF Budget of R67.4 million will be used to maintain a GRAP compliant IAR and to assess provincial IAR’s for compliance.

Facilities Management
PROGRAMME 6 Facilities Management

2018/19 ANNUAL PERFORMANCE PLAN (PART B – PROGRAMME AND SUB PROGRAMMES) STRATEGIC GOAL To ensure optimal performance of the State’s immovable asset portfolio Performance Indicator Audited/ Actual Performance Estimated Performance 2017/18 Medium-Term Targets 2014/15 2015/16 2016/17 2018/19 2019/20 2020/21 Strategic objective: To manage maintenance programmes in accordance with an approved plan 1. Number of facilities with maintenance contracts in place - 718 881 409 500 550 600 2. Percentage of unscheduled reported maintenance incidents resolved within agreed timeframes 18% (9 680) 5% (5 553) 7% (3 124) 5% (595) 15% 20% 25% 3. Percentage of term contracts awarded to BBBEE companies 30% (114) 30% (60) 35% 40% 45% Strategic objective: To ensure resource efficiency in state owned buildings 4. Reduction in energy consumption (kilowatt hours) in identified buildings 000kWh kWh kWh kWh kWh kWh 5. Number of kilowatt hours of renewable energy generated kWh of kWh kWh kWh 6. Reduction in water consumption (kilolitres) in identified buildings 3 550 480kl 4 090 865kl kl kl kl kl kl

Performance Indicator Reporting Period Annual Target Q1 Q2 Q3 Q4 1. Number of facilities with maintenance contracts in place Quarterly 500 50 150 2. Percentage of unscheduled maintenance incidents resolved within agreed timeframes 15% 3. Percentage term contracts awarded to BBBEE companies Annually 35% - 4. Reduction in energy consumption (kilowatt hours) in identified buildings kWh kWh 5. Number of kilowatt hours of renewable energy generated kWh kWh 6. Reduction in water consumption (kilolitres) in identified buildings kl 2 kl kl

Facilities Management Services 2018/19 2019/20 2020/21 R'000 Compensation of employees 216,656 230,955 245,967 Admin goods and services 31,583 33,733 35,555 Turnaround 100,000 - Cleaning and Gardening 292,229 308,594 325,566 Repairs 1,267,844 1,001,696 1,056,790 Maintenance 1,361,252 1,437,482 1,516,543 Total 3,269,564 3,012,460 3,180,421 The spending focus over the medium-term will be on the implementation of Scheduled Maintenance Programmes, to manage and minimize unscheduled maintenance incidents and to reduce the consumption of municipal services. The bulk of the expenditure in this programme is for the compensation of employees to appoint various specialists to assist in rebuilding the PMTE technical and professional capacity; perform repair and maintenance and cleaning and gardening. An MTEF budget of R7.3 billion will be prioritised to implement scheduled maintenance contracts for prioritised buildings and resolve unscheduled maintenance incidents within agreed timeframes. A further R100 million has been allocated for the 2018/19 financial year against the Turnaround Programme for the componentisation of the IAR to determine the accurate condition of each property and the subsequent maintenance strategy required to uplift the condition of the portfolio to an appropriate level. This strategy will be processed through the User Charges Model which will determine the appropriate tariff to be charged to user departments in the PMTE’s quest towards achieving financial sustainability

PMTE 2017/18 APP

LONG TERM INFRASTRUCTURE PLAN
New, replacement, upgrades and additions Infrastructure Programme Number of projects Medium Term Estimates 2018/19 2019/20 2020/21 Departmental 33 Accessibility 100 Dolomite Risk Management Land Ports of Entry 99 Inner City Regeneration 10 Prestige 54 Total 329 PMTE 2018/19 APP

LONG TERM INFRASTRUCTURE PLAN - NEW, REPLACEMENTS, UPGRADES AND ADDITIONS
No. Province Project Details Total Project Costs R'000 Total Allocation 2018/2019 R'000 1. Gauteng Pretoria, Thaba Tshwane, Emergency dolomite call-out services (follow on to current ramp). 31 708 Pretoria, Upgrading of ten water treatment plants. 42 341 22 980 Pretoria, Bryntirion, Construction of gates 1 & 2 as well as the dog unit. 18 591 2. Western Cape Cape Town, Parliamentary Complex, Upgrade to security at entrances to parliamentary precinct, installation of additional perimeter fencing and create a temporary vehicle search park. 64 377 31 769 Cape Town, Customs House: Workshop renovation and upgrade. 79 123 25 666 Cape Town, 90 Plein street, 6th floor: Total refurbishment for Parliament. 32 037 16 762 3. Eastern Cape Port Elizabeth, Eben Donges Building: Alterations and refurbishment including air conditioning and mechanical installation. 21 954 Port Elizabeth, Service products, Dept of Labour: Employment factory: Complete repairs and renovations. 43 406 15 774 Port St Johns, Police Station: Installation of facilities for people with disabilities. 5 000 4. Mpumalanga Lebombo, Border post, 36 Months maintenance and servicing of buildings, civil, mechanical and electrical infrastructure installations. 53 435 12 825 Border post, Oshoek, Nerston, Waverly, Josefsdal, Maintenance, servicing and repairs of buildings, civil, mechanical and electrical infrastructure and installations. 69 405 12 525 Jeppe’s Reef, Border Post, Condition assessment and construction of water supply infrastructure at various land ports of entry. 6 960

No. Province Project Details Total Project Costs R'000 Total Allocation 2018/2019 R'000 5. North West Ramatlabama, Kopfontein and Derdepoort Border Posts: 36 Months maintenance, servicing and repair of buildings, civil, mechanical and electrical infrastructure and installations. 52 530 13 875 Skilpadshek Border Post, 36 Months repairs, maintenance and servicing of buildings, civil, mechanical and electrical infrastructure and installations. 47 717 5 025 Bray, Makgobistad and Swartkopfontein Border Posts: Maintenance, servicing and repair of buildings, civil, mechanical and electrical infrastructure and installations. 25 626 4 535 6. Limpopo Beit Bridge Border Post: Maintenance and servicing of buildings, civil, mechanical and electrical infrastructure installations. 83 236 22 050 Stockpoort and Groblersbrug Border Posts: Maintenance and servicing of buildings, civil, mechanical and electrical infrastructure and installations. 43 488 8 850 Pafuri, Border Post, Maintenance and servicing of buildings, civil, mechanical and electrical infrastructure installations. 20 570 6 300 7. Free State Maseru Bridge, Border Post, Maintenance, servicing and repairs of buildings, civil, mechanical and electrical infrastructure and installations. 34 851 8 325 Van Rooyenshek, Border Post, Maintenance and servicing of buildings, civil, electrical and mechanical infrastructure and installations. 32 902 8 250 Caledonspoort and Ficksburg Bridge Border Post: Maintenance, repair and servicing of buildings, civil, electrical, mechanical, infrastructure and installations. 35 028 6 450

No. Province Project Details Total Project Costs R'000 Total Allocation 2018/2019 R'000 8. Kwa-Zulu Natal Durban Regional Office - old building: Upgrading. 42 120 Durban, Department of Labour: Durban Service Products: Repair and renovations. 40 982 11 340 Kwa-Zulu Natal, Site clearance and planning and design for the maintenance/upgrade and/or upgrade of the patrol roads/fencing on the borders between RSA and Swaziland and Mozambique. 21 392 7 030 9. Northern Cape Vioolsdrift, Border post: Maintenance and servicing of buildings, civil, mechanical and electrical infrastructure and installations at Alexander Bay and Vioolsdrift. 50 556 8 625 Mc Carthysrust, Border post, BCOCC: Maintenance and servicing of buildings, civil, mechanical and electrical infrastructure and installations. 33 758 5 963 Gemsbok and Rietfontein Border Post, Maintenance and servicing of buildings, civil, mechanical and electrical infrastructure and installations. 27 440 5 850

Infrastructure Programme: Maintenance and Repairs Infrastructure Programme Number of projects Medium Term Estimates 2018/19 2019/20 2020/21 Facilities Management 683 PMTE 2018/19 APP

LONG TERM INFRASTRUCTURE PLAN – MAINTENANCE AND REPAIRS
No Province Project Details Total Project Costs R'000 Total Allocation 2018/2019 R'000 1. Eastern Cape Graaff-Reinet Police Station: Repairs and maintenance of leaking roof in the official quaters and drainage system Ngangelizwe: Repairs to Police Station including electrical and civil Elliot: Follow-on contract (repair only) 2. Free State Welkom: Police Station: Jan Hofmeyer road: Repair and maintenance to electrical, civil, mechanical and structural elements Bloemfontein: Parkroad Police Station: Repair and maintenance to electrical, civil, mechanical and structural elements to the complex and a house Deneysville: Green Point farm Prison: Maintenance and operations of water and sewerage works 3. Gauteng Pretoria: Interim maintenance contract for Gauteng Province Pretoria: Interim facilities management contract for Telkom Towers complex (SAPS) Boksburg Prison: Repair and maintenance of electrical and mechanical installations 4. Kwa-Zulu Natal Kokstad: Repair and maintenance of mechanical and electrical installations Durban: Repairing of the leaking roof at Durban king's house Durban Westville: Repair and maintenance for steam lines, calorified boilers and kitchen equipment

No Province Project Details Total Project Costs R'000 Total Allocation 2018/2019 R'000 5. Limpopo Various centres: Northern Province: Maintenance of water and sewer operations in various Police Stations in Limpopo central Thohoyandou Police Station: Repairs & maintenance of civil, electrical, mechanical & structural elements of the station 6. Mpumalanga Trichardt Police station: Repair and maintenance of electrical,civil, mechanical and structural elements including quarters Standerton Police Station: Repairs and maintenance of station and official quartes electrical,civil and structural elements Chrissiesmeer: Repairs and maintenance of electrical,civil,mechanical and structural elements of station and quarters 7. North West Rooigrond: Repair, maintenance and operations of water sewerage Potchefstroom: Prospecting and sinking of new boreholes Bloemhof: Repair of building, electrical and wet services

No Province Project Details Total Project Costs R'000 Total Allocation 2018/2019 R'000 8. Northern Cape De aar Police Station: Repair and maintenance to electrical, civil, mechanical and structural elements to station and houses Jan Kempdorp,sealing of roofs at ammunition stores Van Wyksvlei: Repair to station, quarters 1, 2 and 3 at Hoof Street and President Street 9. Western Cape Cape Town: Official residential accommodation: Provide integrated facilities management services. (for a 5 year period) Cape Town: WC: Appointment of implementing agent for the development of new SEDFS and rehabilitation of 13 proclaimed fishing harbours a per the SEDFS: additions, alterations & refurbishment Cape Town: Official residential accommodation: Provide integrated facilities management services. (For a 5 Year Period)

Infrastructure Programme: Rehabilitation, renovation and refurbishment Infrastructure Programme Number of projects Medium Term Estimates 2018/19 2019/20 2020/21 Construction Project Management 526 PMTE 2018/19 APP

LONG TERM INFRASTRUCTURE PLAN - REHABILITATION, RENOVATION AND REFURBISHMENT
Province Project Details Total Project Costs R'000 Total Allocation 2018/2019 R'000 1. Eastern Cape Umtata: Repair & refurbishment of mechanical, electrical, building ,civil & other related services Umtata, Prison: Repairs and Renovations Umtata,Repars and Renovation of Police camp including electrical and civil works 2. Free State Fouriesburg: Repair and Renovations Vrede: Condition based maintenance on structural, electrical and civil elements Bloemspruit: Repair & renovation to buildings 70, 81, 82, 83, 95, 104, 105, 107 and 318: Group 5 3. Gauteng Pretoria, restoration of old Magistrate court Diepmeadow: Repair and maintenance of electrical and mechanical installations excluding boilers, calorifies pipes Randfontein: President Kruger building: Complete repair and renovation including fencing 4. Kwazulu Natal Pietermaritzburg: Rehabilitation of old DPW workshops on Prince Edward Street Durban: Rehabilitation of 99 Shepstone road Durban point area Umlazi: Heritage - repairs and renovations to office building

LONG TERM INFRASTRUCTURE PLAN – REHABILITATION, RENOVATION AND REFURBISHMENT
Province Project Details Total Project Costs R'000 Total Allocation 2018/2019 R'000 5. Limpopo Polokwane: Reconstruction of offices, replacement of generator,fire equipment,air conditioners, damaged by fire Lebowakgomo: Rehabilitation of government printing building for SAPS Nebo: Repair and renovations 6. Mpumalanga Witbank: Repair and renovations of building Nelspruit: Sandriver: Repairs and renovation of the base Groblersdal: Repair and renovations of building 7. North West Mogwase: Repair and upgrading of the entire centre Klerksdorp: Total repair and renovation of the entire prison Losperfontein: Condition based maintenance on electrical, mechanical, building and civil infrastructure

LONG TERM INFRASTRUCTURE PLAN – REHABILITATION, RENOVATION AND REFURBISHMENT
Province Project Details Total Project Costs R'000 Total Allocation 2018/2019 R'000 8. Northern Cape Jan Kempdorp: Repair and renovation to non commissioned officers mess Kimberley: Repair and maintenance for various lifts in the Northern Cape Region Kimberley: Additions to the airconditioniong system in the new public office utilised by Department of Justice 9. Western Cape Cape-Town: Heritage - Refurbishment of NCOP Building, including HVAC, electrical and electronic installations Cape town: Contract B, modernization, repairs and maintenance of lifts in the Western cape Cape-Town: Contract A, modernization, repairs and maintenance of lifts in the Western Cape

APPROVED SERVICE DELIVERY IMPROVEMENT PLAN
Key Service Delivery Area Key Improvement Activities Customer / client relations Conduct client satisfaction surveys Service level agreements in place Effective contract management Streamlining business processes to improve response times Conduct regular client portfolio meetings Accommodation provision Provide accommodation that adheres to clients needs Effective lease management Delivering projects that adhere to approved norms and standards Accommodation improvement Assessment of facilities for green drop compliance Assessment of facilities for blue drop compliance Ensure fit for purpose accommodation through Total Facilities Maintenance Programmes PMTE 2018/19 APP

STRATEGIC RISKS FOR PMTE
Action Plan Inadequate service delivery leading to the erosion of the Department's mandate Insourcing of capacity through the filling of funded and critical posts within the new PMTE Structure Finalisation and implementation of the Framework for National Technical Capacity Building Programme Design of the Knowledge Management/ ICT platform for National Technical Capacity Building Programme Streamlining business processes to improve response times Identification of external funding sources and development of proposals to meet funding requirements Development of a Client Relations Management (CRM) Strategy primarily focusing on three components: CRM Model, CRM Protocol and CRM IT system Implementation Programme of the CRM Strategy across the value chain Implementation of CRM Model to support the review of the User Charge Model with user departments (phased approach) Development of life cycle plans for prioritised immovable assets Quarterly engagements with Municipalities to align planned precincts with Municipal Infrastructure Plans Implementation of the Property and Projects Modules on ARCHIBUS System PMTE 2018/19 APP

STRATEGIC RISKS FOR PMTE
Action Plan Inadequate service delivery leading to the erosion of the Department's mandate Implementation and training for completed modules on the ERP systems. Enhancement of the existing business processes. Establish contractor incubator programme that includes mentoring and training of contractors. Enforcement of delegation of authority to terminate non-performing contractors. Develop Contract Management Framework. Comparison of the listed accruals to the payments made after year end. Preparation of user friendly templates by Finance. Establishment of a function to manage Projects Accountants. Establish a function for Project Management Support. Monthly performance review meetings with all executing units. PMTE 2018/19 APP

PART C - STRATEGIC RISKS FOR PMTE
Action Plan Inadequate service delivery leading to the erosion of the Department's mandate. Insourcing of capacity through the filling of funded and critical posts within the new PMTE Structure. Finalisation and implementation of the Framework for National Technical Capacity Building Programme. Design of the Knowledge Management/ ICT platform for National Technical Capacity Building Programme. Identification of external funding sources and development of proposals to meet funding requirements. Development of a Client Relations Management (CRM) Strategy primarily focusing on three components: CRM Model, CRM Protocol and CRM IT system. Implementation Programme of the CRM Strategy across the value chain. Implementation of CRM Model to support the review of the User Charge Model with user departments (phased approach). PMTE 2018/19 APP

Action Plan Inadequate service delivery leading to the erosion of the Department's mandate. Development of life cycle plans for prioritised immovable assets. Quarterly engagements with Municipalities to align planned precincts with Municipal Infrastructure Plans. Implementation of the Property and Projects Modules on ARCHIBUS System. Implementation and training for completed modules on the ERP systems. Enhancement of the existing business processes. Establish contractor incubator programme that includes mentoring and training of contractors. Enforcement of delegation of authority to terminate non-performing contractors. Develop Contract Management Framework Establishment of a function to manage Projects Accounts Establish a function for Project Management Support Monthly performance review meetings with all executing units PMTE 2018/19 APP

Action Plan Inadequate maintenance and safeguarding of State assets. Implementation of the Top 300 pilot Programme. Appointment of interim specialists to implement relevant regulations in terms of the OHS Act of 85 of 1993. Executing units to take full responsibilities as 16.2 in terms of the OHSA appointees in their Regions. Utilisation of State agencies (DBSA/CSIR/COEGA) to fast track the implementation of maintenance interventions. Physical verification and detailed technical analysis to assess condition of the immovable asset portfolio at sub component level Facilities Management and Finance engaging National Treasury to increase funding for schedules maintenance, repair and refurbishment. Identification of assets classes to be incorporated into planned maintenance programme (water system). Implementing the critical component programme for lifts. PMTE 2018/19 APP

Action Plan Inadequate maintenance and safeguarding of State assets. Implement facilities management module (on the ERP System) to track current unscheduled maintenance calls. Finalisation of the Illegal Occupation strategy. Operation Bring back. Business Plan to address illegal occupation. Verification of properties identified as being illegally occupied. PMTE 2018/19 APP

Action Plan Inadequate delivery of National Government Priorities Implementation of the Green Building programme. Approval of Green Building Principles in line with Green Building Policy EPWP to be applied to all infrastructure projects as part of the tender documentation Training of the emerging Contractors as part of the Contractor Incubator Programme (CIP). Implementation of the Property Incubator Programme (PIP). Implementation of the 2017 Preferential Procurement Regulations (and new SCM Policy) to create sustainable opportunities. PMTE 2018/19 APP

Action Plan Weakening financial viability and sustainability of PMTE Develop a revenue generation strategy. Implementation of Finance Model. Develop a letting - out policy. Implementation of the Lease Module on Archibus. Re- negotiations of leasing-in and letting-out contracts. Revision of the Finance Operating Model: Submit application for tariff increase for the top 15 user departments Revision of payment date to lessors. Revision of user charge per user department (based on the user charge model) Disputes to be submitted to REMS on the 15th of the month Implementation of interest on overdue accounts to motivate user departments to pay accounts on time Submit a request to National Treasury to ring fence the allocation for accommodation PMTE 2018/19 APP

Action Plan Weakening financial viability and sustainability of PMTE Populate the PMTE SCM structure to operationalize demand management as per National Treasury Demand Management Framework. Introduce Demand Management at Regional Offices. Conduct market research, where required, to ensure prices are commensurate with prevailing market conditions. Preparation of effective and realistic annual demand plans. Blacklist Service providers / contractors that are found to have abused the SCM system in terms of the SCM Prescripts. Quarterly engagement with Provinces on the changing SCM Landscape Ongoing SCM training. PMTE 2018/19 APP

Action Plan Inability to maintain a reliable and accurate immovable asset register (IAR) Engage DRDLR (DG, Chief Surveyor General , Chief Registrar of Deeds ), Office of the State Attorney, Municipalities and Provinces for the rectification of the following: Properties reflecting no registered owner as per deeds records ( ), Dual ownership (980), Illegal transfer (325). Implementation of the IAR Module on the ARCHIBUS System. Interface of the IAR Module with the Projects Module within the ARCHIBUS System. PMTE 2018/19 APP

PMTE MTEF revenue projections
PROPERTY MANAGEMENT TRADING ENTITY ANNEXURES PMTE MTEF revenue projections Summary of PMTE budget cuts from 2015/16 to 2020/21 PMTE 2017/18 APP

MTEF PROJECTIONS (REVENUE)
2018/19 2019/20 2020/21 R'000 Management fee on Municipal Services Accommodation charges - client infrastructure projects (freehold) Accommodation charges - user charges (freehold) Municipal services recovered DPW transfer Rental debtors 54 000 58 320 62 986 Other 9 084 9 593 10 120 Accommodation charges - leasehold Total 2018/19 2019/20 2020/21 R'000 2018 MTEF 788,030 820,160 865,269 2018 ENE 730,148 770,160 812,269 NT budget cut 57,882 50,000 53,000

SUMMARY OF PMTE BUDGET CUTS FROM 2015/16 TO 2020/21
DPW transfer 2015/16 2016/17 2017/18 2018/19 2019/20 2020/21 MTEF budget cut R'000 Preliminary allocation 3,634,652 3,790,172 4,013,347 4,246,121 4,338,531 4,518,719 Adjustments: (110,000) (400,724) ( ) (236,631) (105,385) (53,000) (1,236,833) Baseline reductions (50,000) (103,713) (112,227) (111,929) Augmentation (250,000) (190,394) (98,967) (53,00) DPW Capital (60,000) (91,966) (76,000) BIU/ SCM/ SIU 44,955 47,528 50,265 Revised allocation 3,524,652 3,389,448 3,682,254 4,009,490 4,233,146 4,465,719

Office of the Director-General I Public Works I CGO I Pretoria

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Office of the Director-General I Public Works I CGO I Pretoria

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