2015-2020
STRATEGIC PLAN
Presentation to the Portfolio Committee on Economic Development
05 May 2015
Introduction
The Commission has developed:
• Prosecution
of anti-competitive
conducts
• A new, 15-year Vision and Mission
which takes
into account SA’s
socio-
Mandate
economic context.
• Prevent concentration through merger
control
• A new Strategic Plan for 2015-2020, which serves a 5 year milestone towards
the vision.
• An Annual Performance Plan, to realise the strategy.
National Policy Context
The Strategy is responsive to the national policy context:
1.
THE NATIONAL DEVELOPMENT PLAN (NDP)
•
South Africa’s long-term vision;
•
Rallies for the elimination of poverty and reduction of inequality by 2030;
•
2.
•
• Prosecution of anti-competitive conducts
• Prevent concentration through merger
Calls for a social pact for economic growth and job-creation.
control
Mandate
THE NEW GROWTH PATH (NGP)
Identifies areas where employment creation is possible, both within economic sectors as conventionally
defined and in cross-cutting activities;
•
Analyses the policies and institutional frameworks required to take advantage of these opportunities,
including competition policy.
3.
THE INDUSTRIAL POLICY ACTION PLAN (IPAP)
•
Advances growth through manufacturing development;
•
Promotes and targets strategic sectors which are labour-absorbing and can be beneficiated in order to
harness or build competitiveness;
•
Multi-pronged instrument approach: trade policy; local procurement, competition policy, development
finance etc.
The NGP: Competition policy as an
economic driver
The New Growth Path identifies measures for competition policy as an economic
driver:
a) Investigations should continue focus on strategic sectors i.e. food, construction/infrastructure, IPAP sectors etc.
b)
• Prosecution of anti-competitive conducts
Law-enforcement agencies to cooperate
activelyconcentration
with competition authorities
to address
comp. law
• more
Prevent
through
merger
breaches.
control
Mandate
c) The competition authorities to review their procedures to reduce the opportunity for vexatious litigation and
speed up competition probes.
d) More consideration to mandating public interest conditions on proposed mergers.
e) Competition authorities should involve trade unions more and unions should develop their capacity to share
information and insights on employment issues in mergers and acquisitions.
f)
Government to amend the Competition Act to enhance the Tribunal’s power to order divestiture where inherited
market power permits repeated abuse and to provide mechanisms to address pricing in markets characterised
by economic concentration.
g) The competition authorities and DFIs to identify instances where support for new market entrants is needed to
secure more competitive outcomes, in order to combine competition and investment measures.
h) Government will develop guidelines for granting exemptions for producers to cooperate where it will
demonstrably benefit job creation and expansion into export markets.
Vision 2030
“A Growing and Inclusive Economy”
• Prosecution of anti-competitive conducts
• Defines the Commission’s role in the transformation of the South African
• Prevent concentration through merger
economy;
control
Mandate
• Places new emphasis on the developmental role of competition in the economy;
• Focus on CC contribution to both “growth” and “inclusiveness” of the economy.
Our Mission is: To Undertake Competition Regulation for a Growing and
Inclusive Economy.
Strategy Impact Areas
Our Strategy is a contribution to:
of anti-competitive
conducts
1. ECONOMIC DEVELOPMENT:•ToProsecution
promote the efficiency,
adaptability and
development of
the economy;
• Prevent concentration through merger
Mandate
control
2. FAIR PRICES: To provide consumers with competitive prices and product choices;
3. JOB-CREATION: To promote employment and advance the social and economic welfare
of South Africans;
4. EXPORT PROMOTION: To expand opportunities for South African participation in world
markets and recognise the role of foreign competition in the Republic;
5. SME PROMOTION: To ensure that small and medium-sized enterprises have an
equitable opportunity to participate in the economy;
6. INCREASED OWNERSHIP BY HDI’S: To promote a greater spread of ownership, in
particular to increase the ownership stakes of historically disadvantaged persons.
(As per s.2 of the Competition Act.)
The Strategic Goals (1/3)
Goal 1: “Effective Competition Enforcement and Merger
Regulation”
• Prosecution
of anti-competitive conducts
•
Mandate
• Prevent concentration through merger
The CC effectively uses tools such
as merger control and enforcement to achieve
control
efficiency gains, as well as the developmental objectives set out in the Competition Act.
Goal Outcomes:
a) Efficient and effective merger regulation.
b) Competitive markets through action against cartels and abuse of dominance.
c) Improved public interest outcomes in markets (relating to jobs, industrialisation, exports,
development of black-owned businesses and SMMEs.
d) Increased competition compliance.
e) Improved understanding of market dynamics in priority sectors.
The Strategic Goals (2/3)
Goal 2: “Strategic Collaboration and Advocacy”
•
•
• Prosecution of anti-competitive conducts
The CC emphasises the building
partnerships
and collaborations
other
• of
Prevent
concentration
through with
merger
economic role-players and actors control
in order to attain inclusive growth.
Mandate
This is in the recognition that the resolution of most economic problems often requires
more than one form of intervention.
Goal Outcomes:
a) Improved co-ordination on the application of economic policy and competition policy.
b) Recognition of developmental perspectives in domestic and international competition law
discourse.
c) Improved compliance and awareness.
The Strategic Goals (3/3)
Goal 3: “A High- Performance Agency”
•
• Prosecution of anti-competitive conducts
• Prevent concentration through merger
The CC successfully delivers on its objectives through a cohesive, well-structured
control
Mandate
organisation in which people, processes and systems perform optimally.
Goal Outcomes:
a) Improved organisational efficiency.
b) Accountably managed resources.
c) Highly motivated and productive people.
Alignment with MTSF Outcome 4
OUTCOME 4: “Decent employment through inclusive growth”
•
The CC’s strategic focus is on addressing abuse of dominance, especially in manufacturing input products, so
•
By addressing abuse of dominance in the economy, more players can compete. Further, through effective
• Prosecution of anti-competitive conducts
as to allow for growth to be realised in downstream industries. The manufacturing downstream industries have
• Prevent concentration through merger
been identified in the NGP and IPAP as high-potential job drivers.
control
Mandate
merger control, there is also mitigation against greater concentration of ownership, thus allowing for more
players to participate in the economy. More economic participants allows for shared (inclusive) growth.
•
The CC’s strategic focus is also on dismantling cartels in order to level the economic playing field and to
reduce barriers to entry. This allows for new players, including SMEs to enter markets, and thus jobs can be
created.
•
The CC also imposes conditions on mergers to limit job-losses and encourages firms to consider alternatives
to retrenchments, including encouraging the re-training of staff. The CC empowers Trade Unions and other
role-players to effectively participate in merger transactions through training initiatives.
Alignment with MTSF Outcome 6
OUTCOME 6: “An efficient, competitive and responsive economic
infrastructure network”
•
• Prosecution of anti-competitive conducts
• Prevent concentration through merger
enabling them to expand (jobs) to new markets (exports). This creates a strong economic
control
Mandate
The dismantling of cartels means that firms can pursue innovation and production efficiencies thus
infrastructure. Through the effective use of exemption provisions, the CC can also unlock industry
potential to generate exports, thereby creating competitiveness.
•
The CC’s addressing of price-fixing in markets allows for wider consumer-choice and also removes
artificial inflationary pressures on the economy. These price efficiency gains translate to economic
efficiency.
•
The CC’s new strategy continues its enforcement and prosecution of firms in strategic (priority)
economic sectors, including Telecoms, Banking, Intermediate Industrial Inputs and Infrastructure
Services. It also carries out economic studies to scope for further anti-competitive conduct in these
markets.
The Annual Performance Plan
34 APP targets have been developed. The key outputs for which targets have been set
are summarised as follows:
• Prosecution of anti-competitive conducts
• Prevent concentration through merger
Increase prosecution rate for competition
enforcement.
control
Mandate
1. Investigate abuse-of-dominance, cartels and restrictive cases in priority sectors.
2.
3. Ensure efficiency in merger control and compliance of merger conditions.
4. Determine appropriate priority sectors.
5. Initiate and complete Market Inquiries.
6. Pursue partnerships and collaborations with other agencies and role-players on economic
policy.
7. Support law enforcement agencies in the criminal prosecution of cartelists.
8. Undertake education and outreach initiatives to the general public and other stakeholders.
9. Build and consolidate relationships with BRICS and African partners.
10. Improve organisational efficiency through appropriate operational mechanisms.
Operational Plans
•
Priority Sectors: annual revision.
•
• Prosecution of anti-competitive conducts
Scoping Studies and Impact Assessments: ongoing.
• Prevent concentration through merger
control
•
Human Resources:
Mandate
–
Organisational Structure: design of organogram, job grading and job descriptions.
–
Performance Management System (PMS): design of a new and aligned PMS.
–
Organisational Culture: assessment of org. culture, determination of values, design of
relevant solutions.
•
Knowledge Management and Information Technology
–
Revision of the Knowledge Management System and re-development of the underlying
technological design.
Budget
The strategy is underpinned by a Budget and MTEF estimates
.
Table 1: Expenditure Estimates by Programme
Expenditure per division
2013/14
2014/15
2015/16
2016/17
2017/18
20 325
22 680
31 297
31 722
33 902
Cartel
17 918
24 283
23 994
25 682
26 965
Policy and research
37 260
34 483
36 420
37 554
39 431
Legal services
37 310
46 229
48 746
50 067
52 570
47 690
46 580
–
–
291 859
283 139
268 675
283 912
2013/14
2014/15
2015/16
2016/17
2017/18
Actual
Budget
Forecast
Forecast
Forecast
HR Costs
119 325
168 318
166 207
166 207
175 115
Operational Costs
79 600
123 541
116 932
102 468
108 797
291 859
283 139
268 675
283 912
Mandate
R’000
Administration
Mergers and acquisitions
Enforcements and exemptions
•Actual
Prosecution
of anti-competitive
conductsForecast
Budget
Forecast
Forecast
632
96 505
77 099
362
109 741
•70 Prevent
concentration
through103merger
15 480
19 004
20 289
21 303
control 19 989
Private healthcare market Inquiry
Total Expenses
198 925
Table 2: Expenditure per economic classification
Expenditure per division
R’000
Total Expenditure
198 925
THANK YOU
Tel: 012 – 394 3200/ 3580
Fax: 012 – 394 0166/4580
Email: [email protected]/
[email protected]
Website: www.compcom.co.za