National Treasury
Framework and templates for provincial departments
for the preparation of
Strategic and Performance Plans for 2005-2010,
and Annual Performance Plans for the 2005 financial year
Background:Linking Strategic Planning to the Electoral Cycle
Section One: Planning, budgeting and reporting framework for provincial departments
Section Two: Framework and definitions
Section Three: Generic format for Five-year Strategic and Performance Plans
Section Four:Generic format for Annual Performance Plans
16 August 2004
Contact person:
Jan Hattingh
Tel: 012 315 5009
Cell: 082 466 8128
BACKGROUNDLinking Strategic Planning to the Electoral Cycle
Progress made with strategic and performance planning to date
In November 2001 the National Treasury released a discussion document entitled “Proposed Generic Framework and Format for Strategic Plans for Provincial Departments”. Since then the document has been revised twice with a view to streamlining the format and content of strategic and performance plans, and ensuring that such plans are indeed strategic in nature.
National Treasury’s review of provincial strategic and performance plans over the past three years reveals that nearly all provincial departments are seeking to follow the format for presenting strategic planning information proposed by the above mentioned documents. This is very encouraging.
Also encouraging is the work that has taken place within certain sectors to standardise programme and sub-programme structures and to develop a basic set of common measurable objectives across these programmes and sub-programmes, thus facilitating inter-provincial comparisons.
This document outlines a further set of developments aimed at improving the quality of strategic and performance plans, while at the same time simplifying the process further. The most significant innovation is the proposed linking of the strategic planning process to the electoral cycle – which has a number of implications for the structure and content of strategic and performance plans. These implications are spelt out below.
Linking up with the electoral cycle: what does this mean?
Every five years the citizens of South Africa vote in national and provincial elections in order to choose the political party they want to govern the country or the province for the next five years. In essence the voters give the winning political party a mandate to implement over the next five years the policies and plans it spelt out in its election manifesto.
Following such elections the majority party (or majority coalition) in the National Assembly elects a President, who then selects a new Cabinet. The President and the Cabinet have the responsibility (mandate) of implementing the majority party’s election manifesto nationally. While at the provincial sphere, the majority party (or majority coalition) in each provincial legislature elects a Premier, who selects a new Executive Committee. The Premier and the Executive Committee have the responsibility (mandate) of implementing the majority party’s election manifesto within the province.
To facilitate the translation of the governing party’s election manifesto into national/provincial government policy and plans it is desirable that the strategic planning process within government be synchronised with the electoral cycle. Such a link would enable the incoming President and Cabinet (or Premier and Executive Committee) to ensure that the strategic direction and actions of government over the next five years are aimed at implementing the policies and plans necessary to give effect to the electoral mandate.
It is obviously not possible to synchronise the two processes exactly. However, the aim should be to ensure that the next planning cycle after an election reflects the policies and plans of the new government.
Overview of proposed developments
To synchronise the strategic planning process with the electoral cycle it is proposed that the current strategic and performance plans that are produced by provincial departments should be separated into two documents, as follows:
- Five-year Strategic and Performance Plans
- Purpose: The purpose of the Five-year Strategic and Performance Plans is to set out the newly elected provincial government’s and MEC’s strategic policy priorities and plans for the next five years. This document should serve as a blueprint for what the provincial department plans to do over the next five years.
- Focus: The focus of the document is to specify strategic goals for the provincial department as whole, and strategic objectives for each of its main service delivery areas that the provincial department will strive to achieve over the next five years. The intention is that these goals and objectives lay the foundation for the development of the Annual Performance Plans.
- Time frames: As the name implies this document must cover a period of five years from the first planning cycle following an election. Only one Five-year Strategic and Performance Plan per provincial department will be produced per election cycle.
- Linked to: The document must be developed taking into consideration a wide range of other planning frameworks ranging from the President’s Medium Term Strategic Framework through to the Integrated Development Plans of local governments. It is also important that the plans take into consideration the resource envelope specified in the current provincial MTEF. The document lays the foundation for the development of the Annual Performance Plans.
The provincial department’s performance against its Five-year Strategic and Performance Plan must be evaluated and reported in the End-Term Review.
- Annual Performance Plans
- Purpose: The purpose of the Annual Performance Plans is to set out what the provincial department intends doing in the upcoming financial year towards progressively achieving the full implementation of the Five-year Strategic and Performance Plan.
- Focus: The focus of the document is to specify measurable objectives and performance targets that will ensure that the provincial department realises its strategic goals and objectives set out in the Five-year Strategic and Performance Plan. A secondary focus area is to provide annual updates on any changes made to the strategic planning framework set out in the Five-year Strategic and Performance Plan – for instance changes resulting from new policy developments or changes in environmental circumstances.
- Time frames: As the name implies this document covers the upcoming financial year. It should also cover the following two years in line with the MTEF.
- Linked to: The Annual Performance Plans should inform and be informed by the Budget and the MTEF. Indeed these plans should show how the provincial department’s future service delivery plans link to its MTEF. The in-year implementation monitoring of the Annual Performance Plans is done through the Quarterly Performance Reports, while the end-year reporting is done in the departmental performance section of the Annual Report.
Note that the intention is not to break the link between strategic and performance planning, but rather to emphasise the longer-term strategic focus of the strategic plan, and the annual performance focus of the performance plan.
It is hoped that this new approach will encourage the managements of provincial departments to be less mechanistic in the way they do strategic planning. Rather, it is hoped that because the department is only required to produce a comprehensive Five-year Strategic and Performance Plan once every five years that the management (working together with their MEC will invest the time and effort to develop really good quality, useful Five-year Strategic and Performance Plans. After all these plans need to serve as the department’s programme for action over the next five years, and are the standard against which the MEC’s and department’s performance will be measured.
It is also envisaged that the more streamlined Annual Performance Plans will reduce the management burden associated with producing these documents, as well as their length, and that these two factors will result in departments producing better quality and more user-friendly documents.
The above changes do not impact on the format of the Quarterly Performance Reports or on the departmental performance sections of the Annual Reports. The Presidency has, however, proposed the introduction of a Ten Year Review – 2014. Building on this idea it is suggested that at the end of a provincial government’s term of office each provincial department should produce an End-Term Performance Review. The aim of this Review would be to give an overall evaluation of the extent to which the department succeeded in implementing its Five-year Strategic Plan. The Ten Year Review – 2014 would then reflect on progress made by the provincial government in addressing key policy goals over the last two government terms.
The following figure gives an overview of the timing of these different planning and reporting documents, and also sets out the relationship between them. These relationships are elaborated upon more fully in Section One of this document.
Note that National Treasury continues to encourage the national and provincial departments in each of the sectors to co-operate with each other to develop a minimum set of measurable objectives and performance measures (for programmes and sub-programmes as appropriate) that all provincial departments in the respective sectors will use. Obviously these processes need to inform the individual department’s Five-year Strategic and Performance Plans where relevant, and must definitely inform their Annual Performance Plans.
What is prescribed and what are guidelines?
Note that the National Treasury has or will prescribe the following in the Treasury Regulations:
- The production and tabling of the Five-year Strategic and Performance Plan (as described above) by each provincial department.
- The production and tabling of a 3-year Annual Performance Plan together with the first year of the annual performance plan providing for quarterly performance measures and targets (as described above) by each provincial department.
- The production of Quarterly Performance Reports, and the production and tabling of Annual Reports.
The rest of this document serves as a good practice guideline. In other words the proposed templates are suggested, rather than prescribed. It is envisaged that this will provide for a minimum set of information that will assist treasuries in the resource allocation process. Secondly, it is the prerogative of provincial legislature to require additional information that will assist them with their oversight responsibility. However, it is critical that departments produce only one document that caters for the information requirements of all relevant role-players and key stakeholders. The aim of this document is to indicate the kinds of information and analysis that provincial departments should ideally include in their Five-year Strategic and Performance Plans and Annual Performance Plans.
Obviously where there are sectoral processes to develop uniform formats for reporting strategic planning information, departments in those sectors need to adhere to those agreed formats.
The strategic and performance planning process for 2005/06
In order to give effect to the above changes, the following process will be followed:
- Provincial departments are required to submit the first draft of their Five-Year Strategic and Performance Plans, their Annual Performance Plans and Budget to the provincial treasury according to the provincial budget process schedule by no later than 31 August 2004 (Please note that this date merely illustrate when the first draft submissions should reach National Treasury and that these dates will vary across provinces and put provincial treasuries in a position to evaluate and ensure that these documents comply with the various requirements before it is forwarded to National Treasury). The National Treasury will review the Five-Year Strategic and Performance Plans and Annual Performance Plans and give detailed feedback by 15October 2004.
- Provincial departments are required to submit a second draft of their Five-Year Strategic and Performance Plans, their Annual Performance Plans and Budget to the provincial treasury according to the provincial budget process schedule by no later than 10December 2004 to the National Treasury. Again the National Treasury will review the Five-Year Strategic and Performance Plans and Annual Performance Plans, and departments whose plans are not of an acceptable standard will be contacted and given detailed feedback, and will be required to make the necessary adjustments immediately.
- Finally provincial departments will be required to submit final drafts in late January or early February 2005, and then publish their documents at the prescribed time in March 2005.
Contents
BACKGROUND Linking Strategic Planning to the Electoral Cycle
Progress made with strategic and performance planning to date
Linking up with the electoral cycle: what does this mean?
Overview of proposed developments
What is prescribed and what are guidelines?
The strategic and performance planning process for 2005/06
Section One
1Introduction
2Point of departure: the electoral cycle
3Links between planning, budgeting and reporting processes
4Overview of planning, budgeting and reporting documents
Section Two
1Introduction
2Integrating Government planning processes
2.1National, provincial and local government planning frameworks
2.2Linking the Five-year Strategic and Performance Plans to other planning frameworks
2.3Updating the Five-year Strategic and Performance Plans
3Overview of planning document’s formats and links
3.1Five-year Strategic and Performance Plans
3.1.1Aim and focus of Part A of the Five-year Strategic and Performance Plan
3.1.2Aim and focus of Part B of the Five-year Strategic and Performance Plan
3.1.3Aim and focus of Part C of the Five-year Strategic and Performance Plan
3.2Annual Performance Plans
3.2.1Aim and focus of Part A of the Annual Performance Plan
3.2.2Aim and focus of Part B of the Annual Performance Plan
3.2.3Aim and focus of Part C of the Annual Performance Plan
4Information for Operational Plans
5Definition of terms used in strategic planning
5.1Strategic Goals
5.2Strategic Objectives
5.3Measurable Objectives
Section three
Foreword
Part A: Strategic Overview
1Overview of Strategic Plan
2Vision
3Mission
4Values
5Sectoral situation analysis
5.1Summary of service delivery environment and challenges
5.2Summary of organisational environment and challenges
6Legislative and other mandates
7Broad policies, priorities and strategic goals
8Information systems to monitor progress
9Description of strategic planning process
Part B Programme and sub-programme plans
10Programme X: (NAME)
10.1Situation analysis
10.2Policies, priorities and strategic objectives
10.3Analysis of constraints and measures planned to overcome them
10.4Description of planned quality improvement measures
10.5Sub-programme X.Y: (NAME)
10.5.1Situation analysis
10.5.2Policies, priorities and strategic objectives
10.5.3Analysis of constraints and measures planned to overcome them
10.5.4Description of planned quality improvement measures
10.6Subprogramme X.Y: (NAME)
10.6.1Situation analysis
10.6.2Policies, priorities and strategic objectives
10.6.3Analysis of constraints and measures planned to overcome them
10.6.4Description of planned quality improvement measures
10.7Resourcing information
11Programme Y: (NAME)
11.1Situation analysis
11.2Policies, priorities and strategic objectives
11.3Analysis of constraints and measures planned to overcome them
11.4Description of planned quality improvement measures
11.5Sub-programme X.Y: (NAME)
11.6Resourcing information
12Capital investment, maintenance and asset management plan
13Co-ordination, co-operation and outsourcing plans
13.1Interdepartmental linkages
13.2Local government linkages
13.3Public entities
13.4Public, private partnerships, outsourcing etc
Part C: Background information
14Appendix one: Analysis of service delivery environment
14.1Policy changes and trends
14.2Environmental factors and emerging challenges
14.2.1Demographic profile of the province
14.2.2Employment, income and [other relevant information]
14.2.3[Health, education, welfare etc] profile of people in the province
14.3Evaluation of current implementation performance
15Appendix two: Organisational information and the institutional environment
15.1Organisational design
15.2Delegations and performance agreements
15.3Capital investment, maintenance and asset management plan
15.3.1Long term capital investment and asset management plans
15.3.2Capital investment plan
15.4Personnel
15.5IT systems
15.6Performance management system
15.7Financial management
15.8Audit queries
Section Four
Foreword
Part A: Overview and strategic plan updates
1Overview
2Strategic plan update analysis
Part B Programme and sub-programme performance targets
3Programme X: (NAME)
3.1Specified policies, priorities and strategic objectives
3.2Progress analysis
3.3Analysis of constraints and measures planned to overcome them
3.4Description of planned quality improvement measures
3.5Sub-programme X.Y: (NAME)
3.5.1Specified policies, priorities and strategic objectives
3.5.2Progress analysis
3.5.3Analysis of constraints and measures planned to overcome them
3.5.4Description of planned quality improvement measures
3.5.5Specification of measurable objectives and performance indicators
3.6Subprogramme X.Y: (NAME)
3.6.1Specified policies, priorities and strategic objectives
3.6.2Progress analysis
3.6.3Analysis of constraints and measures planned to overcome them
3.6.4Description of planned quality improvement measures
3.6.5Specification of measurable objectives and performance indicators
3.7Reconciliation of budget with plan
4Programme Y: (NAME)
4.1Specified policies, priorities and strategic objectives
4.2Progress analysis
4.3Analysis of constraints and measures planned to overcome them
4.4Description of planned quality improvement measures
4.5Specification of measurable objectives and performance indicators
4.6Sub-programme X.Y: (NAME)
4.7Reconciliation of budget with plan
5Implementation of the capital investment, maintenance and asset management plan
6Medium-term revenues
6.1Summary of revenue
6.2Departmental revenue collection
6.3Conditional grants
6.4Donor funding
7Co-ordination, co-operation and outsourcing plans
7.1Interdepartmental linkages
7.2Local government linkages
7.3Public entities
7.4Public, private partnerships, outsourcing etc
8Financial Management:
8.1Strategies to address audit queries
8.2Implementation of PFMA
Part C Analysis of changes to programmes
Annexure One: Current guidelines and regulations dealing with strategic planning
5.1Annual preparation of strategic plans
5.2Submission and contents of strategic plans
5.3Evaluation of performance [Section27(4) read with 36(5) of the PFMA]
Annexure two: INFRASTRUCTURE PLAnning82
Section One:
Planning, budgeting and reporting framework for provincial departments
1Introduction
This section sets out an over arching framework that explains the links between planning, budgeting and reporting for provincial departments and the relationship between the different documents that provincial departments are expected to produce in relation to each of these processes.
2Point of departure: the electoral cycle
Every five years the citizens of South Africa vote in national and provincial elections in order to choose the political party they want to govern the country and the various provinces for the next five years. In essence the voters give the winning political party a mandate to implement over the next five years the policies and plans it spelt out in its election manifesto.