Public Economics And Modelling
DNA’s Public Economics and Modelling supports government departments and international agencies in the analysis and review of government spending from an economic efficiency perspective. Specifically, we work with public officials to design and develop policies, strategies and service delivery models that optimise the allocation of government resources and provide for the greatest economic and social returns.
Geographic footprint
Our understanding of the African context and our access to regional expertise and data equips us to work beyond the borders of South Africa. Over the last three years, we have completed projects in Lesotho, Namibia, Eswatini, Cameroon, Botswana, Ghana, Nigeria, Togo, Kenya, Ethiopia, and Tunisia.
The range of techniques we employ
- Financial Modelling
- Performance and Expenditure Reviews
- Fiscal Policy Analysis
- Macroeconomic Analysis and Forecasting
- Labour Market Analysis
- Development of Financing Strategies
- Econometric Analysis
- Index Development
- Qualitative Research
- Government Budget Analysis
- Scenario Analysis
- Descriptive Statistical Analysis
For more information on DNA’s public economics and modelling work please contact:
Fouche Venter at +27 (0)12 362 0024 or email us on contact@dnaeconomics.com.
Recent clients
- Department of Basic Education
- Department of Social Development
- Department of Health
- National Treasury
- Office of the Chief Justice
- Department of Higher Education and Training
- Department of Planning, Monitoring and Evaluation
- Pact, South Africa
- UNICEF, South Africa
- UNICEF, Eastern and Southern Africa Regional Office
- Deutsche Gesellschaft Fur Internationale Zusammenarbeit (GIZ)
Projects
SOUTH AFRICAN CITIES NETWORK, SOUTH AFRICA, 2014
DNA Economics was appointed by the South African Cities Network to write a chapter on the funding of public transport in South Africa.
PERFORMANCE AND EXPENDITURE REVIEW: TECHNICAL AND VOCATIONAL EDUCATION AND TRAINING, NATIONAL TREASURY GTAC, SOUTH AFRICA, 2015
DNA Economics was commissioned by the National Treasury’s Government Technical Advisory Centre (GTAC) to conduct a Performance and Expenditure Review of public Technical and Vocational Education and Training (TVET) colleges. The National Development Plan and White Paper on Post-School Education and Training identify the expansion and improvement of TVET colleges as a key national policy priority. This project helped the Department of Higher Education and Training and National Treasury to understand the trends in learner performance and spending through the TVET sector to inform planning and policy-making.
COSTING AND FINANCING OF THE WHITE PAPER ON POST-SCHOOL EDUCATION AND TRAINING, NATIONAL TREASURY GTAC, SOUTH AFRICA, 2016
DNA Economics, with support from Mzabalazo Advisory Services, were commissioned by the National Treasury’s Government Technical Advisory Centre (GTAC) to undertake research on the costs of and financing options for the implementation of the White Paper on Post School Education and Training (PSET). The assignment involved the creation of in-depth long term costing models for each of the main PSET sectors (universities, TVET colleges, community colleges and workplace training). The project also considered and modelled the different funding options available for financing these costs in the future. The project’s outputs have been used extensively to inform the DHET’s White Paper Implementation Plan and as input into the decisions of Presidential Commission of Inquiry into Higher Education and Training (”the Fees Commission”).
MALAWI EARLY CHILDHOOD DEVELOPMENT COST-BENEFIT ANALYSIS ( ROGER FEDERER FOUNDATION, SOUTH AFRICA, 2021)
DNA assisted the Roger Feder Foundation in making a case for scaled up quality Early Childhood Development Education in Malawi. The project involved the identification of interventions required, the costing of these interventions and an analysis of these costs in light of intervention benefits and the fiscal space available.
The study was commissioned to address underinvestment in the sector by informing an investment case for ECD in Malawi. The purpose of the study was to estimate the costs and benefits of a high-quality, comprehensive ECD programme for all Malawian children. To this end, the study focused on four research questions;
1. What is the current state of CBCCs in Malawi?
2. What interventions are required at CBCCs?
3. How much does it cost to provide these interventions?
4. What are the potential benefits associated with these interventions?
Addressing these research questions informed the investment case which was designed to inform the decision-making process.
DEPARTMENT OF HIGHER EDUCATION AND DEVELOPMENT POLICY RESEARCH UNIT, FINALISATION OF THE CRITICAL SKILLS LIST, 2021
The Critical Skills List lists occupations for which critical skills visas are made available. The client contracted DNA Economics to analyse comments received on the draft Critical Skills List and update the previous research to identify occupations for which the domestic shortages cannot be timeously addressed within the skills development sector.
FINANCING A UBIG ( INSTITUTE FOR ECONOMIC JUSTICE, SOUTH AFRICA, 2021)
The Institute for Economic Justice (IEJ) published a Policy Brief in March 2021 which explores the potential for a Universal Basic Income Guarantee (UBIG) in South Africa. The Brief covers the rationale, possible implementation models, potential costs, and financing options
DNA was contracted by the Institute for Economic Justice to analyse a range of financing options both in terms of their income generating potential and associated risks. The following options were analysed.
• Social Security Tax
• Selective removal of Medical Scheme Fees Tax Credit
• Selective removal of retirement fund contribution deduction
• Increasing the Dividend Tax rate
• Tax on resource rents 6. Higher VAT rate on luxury products
• Increasing the Estate Duty rate
• Increasing the Securities Transfer Tax rate
• Currency Transaction Tax
MALAWI EARLY CHILDHOOD DEVELOPMENT COST-BENEFIT ANALYSIS ( ROGER FEDERER FOUNDATION, SOUTH AFRICA, 2021)
DNA assisted the Roger Feder Foundation in making a case for scaled up quality Early Childhood Development Education in Malawi. The project involved the identification of interventions required, the costing of these interventions and an analysis of these costs in light of intervention benefits and the fiscal space available.
The study was commissioned to address underinvestment in the sector by informing an investment case for ECD in Malawi. The purpose of the study was to estimate the costs and benefits of a high-quality, comprehensive ECD programme for all Malawian children. To this end, the study focused on four research questions;
1. What is the current state of CBCCs in Malawi?
2. What interventions are required at CBCCs?
3. How much does it cost to provide these interventions?
4. What are the potential benefits associated with these interventions?
Addressing these research questions informed the investment case which was designed to inform the decision-making process.
ILO – CHARACTERISTICS AND CONDITIONS OF THE SOCIAL AND SOLIDARITY ECONOMY IN SOUTH AFRICA (INTERNATIONAL LABOUR ORGANIZATION, SOUTH AFRICA, 2021)
The ILO and DTIC co-delivered SSE-policy-consultation workshops across South Africa between July – December 2019. After each workshop participants filled in a survey. ILO contracted DNA to do an in-depth analysis of the survey responses. The insights from the data allowed for recommendations to be provided on how to support the Social and Solidarity Economy (SSE).
The report answered six research questions broadly aligned to the draft Green Paper’s objectives:
• What characterises SSE practitioners and their organisations?
• Where do Social and Solidarity Economy Organisations (SSEOs) fit into the regulatory framework?
• What sectors do SSEOs operate in, and where do they fall short?
• How do SSEOs access funding?
• What is the skills profile of SSEOs?
• What did respondents say about their struggles and potential solutions?
INPUT INTO THE SKILLS STRATEGY FOR THE ECONOMIC RECONSTRUCTION AND RECOVERY PLAN
SA FISCAL SPACE ANALYSIS ( UNICEF, SA , 2020)
DNA Economics assisted UNICEF with support for their Social Policy and Child Protection programme to develop both retrospective (or historical) fiscal space estimates for priority expenditures for children (FY2016-2019) and prospective (or future) fiscal space estimates for priority expenditures for children (FY2020 and FY2021).
The scope of work undertaken by DNA included;
Development of a fiscal model to assess the macroeconomic and debt implications of raising expenditure on children in South Africa given an already constrained budget.
Fiscal space analysis which included analysis of economic outlook, fiscal sustainability, a review of child-centred public expenditure, and the current landscape of child-centred government policy.
Development of a customised Excel-based fiscal space tool
Report that summarised the main findings, provided recommendations for fiscal space options, and possible advocacy strategies
Presentation to all Programme Staff in UNICEF South Africa because the work had clear implications for the kind of public finance advocacy to be done over the next 2-3 years.
FINANCIAL ANALYSIS AND COSTING OF EARLY GRADE READING PROGRAMME (UNICEF, SOUTH AFRICA, 2020)
After successfully implementing and testing various literacy interventions models, the DBE wanted to understand the potential financial implications of scaling the programme across the country. The research entailed developing an Excel-based modelling tool customisable to different provincial contexts and estimating the resource requirements and the development of funding options.
The overall objective of this assignment was to propose funding models and costing tools based on an analysis of existing funding and feasible additional proposals. This would include how existing budgets may be allocated, repurposed or increased; proposing new business cases where necessary; and providing guidance on non-governmental actors on the strategic areas they may fund.
The specific objectives included
•The analysis of the implementation cost and determining the cost of providing each of the different activities at a provincial level
•Public expenditure review focussed on historical and medium-term future spending dynamics.
•The analysis of current financing models and procedures to develop viable funding alternatives and models including the national budget, ETDP-SETA, conditional grants and provincial budgets
•Reviewing and considering the most effective, and feasible manner in which to employ and fund specialist on-site coaching support
•Developing tools and manuals for use by provinces and other stakeholders in the sector
LABOUR MARKET AND SECTOR STUDY ( GIZ, SOUTH AFRICA, 2020)
GIZ tasked DNA Economics to come up with a methodology to prioritize various sub-sectors across 8 African countries. This was done to assist the Skills Initiative for Africa (SIFA), who require information regarding the direction and extent of their investment and financing into prioritized sectors, who themselves have a specific focus on technical and vocational training students, and graduates, across various countries.
An analysis of current and forecasting of future macroeconomic and labour market trends across eight African countries was conducted by DNA in Cameroon, Tunisia, Ethiopia, Nigeria, Ghana, South Africa, Kenya, and Togo. The factors considered in the analysis included:
•The current and future growth trajectory of each economic sector (measured using Gross Value Added)
•The current and future employment trajectory of each economic sector (measured using the number of people employed)
•The degree to which economic growth translates to employment (estimations of the employment-output elasticity of each economic sector, both historically and forecasted)
•The degree to which government strategically prioritised each economic sector historically, and was expected to prioritise each sector in the coming years (done through a systematic review of literature regarding government strategic priority)
These factors were combined into an index which assessed the degree to which each economic sector would be able to create employment in the coming years. The index was built using Principal Components Analysis (PCA).
FACILITY-LEVEL DATA QUALITY ASSESSMENT OF PRIMARY HEALTH CARE INDICATORS IN NORTH WEST BOJANALA DISTRICT, (DEPARTMENT OF HEALTH, SOUTH AFRICA, 2019 -2020)
For this project the RIPDA tool was implemented at the 112 Primary Health Care (PHC) clinics and 8 Community Health Centres (CHC) in Bojanala District in the North West province.
The primary objectives of this data-driven exercise for each of these facilities were to,
1.Compare DHIS data to source data, and correct and clean where necessary
2.Implement the DHMIS checklist
3.Develop an improvement plan
4.Assess the robustness and validity of the data being captured
After the RIPDA was completed for each facility, a high-level report was produced providing a summary of the general findings from the entire study. This was done through a Broad Data Quality Analysis (BDQA)
SECONDARY BENEFITS PLANNING FOR UK PROSPERITY FUND PROGRAMMES IN SOUTH AFRICA (VIVID ECONOMICS / UK FCO, SOUTH AFRICA, 2019/20)
-Better Health programme,
-Digital Access programme,
-Skills for Prosperity programme,
-Infrastructure South Africa programme,
-Economic cluster programme.
ECORYS, SOUTH AFRICA, 2019
DRAFTING OF 2019 SUSTAINABLE DEVELOPMENT GOALS REPORT (GOALS 9, 10, 17) (STATISTICS SOUTH AFRICA, 2019)
DEVELOPMENT OF A BUDGETING / COSTING TOOL FOR HIGH COURTS (OFFICE OF THE CHIEF JUSTICE)
EVALUATION OF THE IMPLEMENTATION, DESIGN AND STRATEGY OF PROJECT KHULISA AGRI-PROCESSING (BLUE NORTH / WESTERN CAPE DEPARTMENT OF AGRICULTURE, 2018)
The Western Cape government developed and implemented Project Khulisa as part of a set of identified ”game changing” interventions to support economic growth and job creation. Project Khulisa identified three priority sectors: Agri-processing, Tourism and Oil and gas.
The purpose of this study was to evaluate the implementation, design, strategy and the institutional arrangements of Project Khulisa Agri-processing in order to determine whether plans implemented to date resulted in their intended outcomes. Project Khulisa Agri-processing consisted of a number of interventions targeting the Halal market, Wine exports and the Agri-processing sector in general.
REVIEW AND PROPOSE INNOVATIVE MUNICIPAL FINANCE SOLUTIONS FOR SOUTH AFRICAN CITIES (JICA / SACN, 2017-18)
The mandate of the AMFM Expert Panel was to formulate and assess possibilities for alternative metropolitan financing models for cities. The panel made a number of recommendations across the three specific fiscal instruments, namely: own revenue, intergovernmental transfers and capital financing.
Following on from the AMFM’s report and recommendations, DNA was contracted (through funding from the Japan International Cooperation Agency (JICA)) to deepen the analysis of the initial instruments identified by the AMFM expert panel. The specific objectives were to: Critically assess suggestions made in the AMFM Expert Panel Report by reviewing alternative sources of municipal financing; Select financial approaches and mechanisms best suited to the South African municipal context through positioning each identified instrument on a difficulty-impact matrix; and Assess the potential revenue impact of selected instruments on metropolitan municipalities.
DEVELOP AND PILOT A CAPACITY BUILDING PROGRAMME (INTERNATIONAL MONETARY FUND, LIBERIA, 2016)
DEVELOP A POLICY ANALYSIS TRAINING PROGRAMME (CLARITY EDITORIAL, SOUTH AFRICA, 2016-2017)
REVIEW OF PROVINCIAL DEVELOPMENT FINANCE INSTITUTIONS (GTAC, 2015-2018)
The methodological approach comprised a review of eight provincial agencies identified as PDFIs, consolidating these findings with those from the review of NDFIs and developing a policy for South Africa’s DFS. The PDFIs were reviewed across six thematic areas: Mandate, Financial sustainability, Corporate governance, Risk management, Organisational structure and Institutional arrangements.
DEVELOPMENT OF COSTING TOOL (COEGA DEVELOPMENT CORPORATION, SOUTH AFRICA, 2015)
THE VULNERABILITY OF WEST AFRICAN COUNTRIES TO THE EBOLA VIRAL DISEASE (STANDARD BANK, 2014)
1. What are the channels through which an infectious disease such as Ebola affects a country’s economy?
2. What country specific factors increase vulnerability to the economic impacts of the Ebola virus?
3. What countries in West Africa are specifically vulnerable to the economic effects of the Ebola virus?
4. What specific sectors or industries in those countries of particular interest to Standard Bank are at greatest risk and in what way?
DEVELOPMENT OF HEALTH STANDARDS AND REGULATION (OFFICE OF HEALTH STANDARDS COMPLIANCE, SOUTH AFRICA, 2014)
DNA Economics was appointed to the Office of Health Standards Compliance, through the HLSP, to provide support on the development of health standards and regulation. For this project, DNA Economics was involved in drafting the health standards, developing a case for good regulatory practices and contributing to the development of regulated standards.
REVIEW THE OPERATIONAL PLANS (DEPARTMENT OF BASIC EDUCATION, SOUTH AFRICA, 2013)
EXPENDITURE PERFORMANCE REVIEW: INDUSTRIAL DEVELOPMENT ZONES (NATIONAL TREASURY, SOUTH AFRICA, 2013/14)
COMPLIANCE OF DISTRICT INTERGOVERNMENTAL FORUMS WITH THE INTERGOVERNMENTAL RELATIONS FRAMEWORK ACT (DEPARTMENT OF COOPERATIVE GOVERNANCE AND TRADITIONAL AFFAIRS, SOUTH AFRICA, 2012)
NORMS AND STANDARDS FOR CONCURRENT FUNCTIONS OF GOVERNMENT (DEPARTMENT OF PERFORMANE MONITORING, SOUTH AFRICA, 2013)
DNA Economics was commissioned to examine the possiblity of using norms and standards as a mechanism for managing concurrent functions listed in Schedule 4 Part A and B of the Constitution. As part of this project, DNA Economics reviewed the current norms and standards within 10 functional areas of concurrent competency, and developed a framework to guide the the development of additional norms and standards to address gaps identified.
As Phase 2 of the project DNA Economics developed additional N&S to fill these gaps for the following national government departments: Basic Education, Human Settlements, Social Development, Health, Transport and Environmental Affairs.
TECHNICAL ASSISTANCE AND MENTORING SUPPORT TO THE NATIONAL TREASURY ECONOMIC POLICY UNIT (NATIONAL TREASURY, SOUTH AFRICA, 2011/12)
SOCIO-ECONOMIC IMPACT MODEL OF THE CONSTRUCTION SECTOR (DEPARTMENT OF PUBLIC WORKS, SOUTH AFRICA, 2011)
R&D GRANT SCHEME FOR SMES IN SOUTH AFRICA (DEPARTMENT OF SCIENCE AND TECHNOLOGY, 2009)
EVALUATION OF ECONOMIC RESEARCH SOUTHERN AFRICA (ERSA) AND THE NATIONAL INCOME DYNAMICS STUDY (NIDS) (SOUTH AFRICAN GOVERNMENT, 2009)
CONTENT EDITING THE ESTIMATES OF NATIONAL EXPENDITURE (NATIONAL TREASURY, 2009, 2008)
SKILLED IMMIGRATION AND WORK PERMITS IN SOUTH AFRICA (CENTRE FOR DEVELOPMENT AND ENTERPRISE; 2008)
SKILLED IMMIGRATION AND WORK PERMITS IN SOUTH AFRICA (CENTRE FOR DEVELOPMENT AND ENTERPRISE; 2008)
CAPACITY CONSTRAINTS IN GOVERNMENT (CENTRE FOR DEVELOPMENT AND ENTERPRISE, 2007)
GENDER RESPONSIVE BUDGETING FRAMEWORK FOR THE DEPARTMENT OF LAND AFFAIRS (DEPARTMENT OF LAND AFFAIRS. 2007-2008)
ECONOMIC REVIEWS OF SOUTH AFRICA (TRUSTED SOURCES; 2008)
LABOUR DIAGNOSTIC STUDY IN THE PRIMARY SECTOR (RESOLVE GROUP, 2007)
SUPPORT FOR ECONOMIC GROWTH AND ANALYSIS (SEGA) (USAID, SOUTH AFRICA, 2008-2008)
MUNICIPAL INFRASTRUCTURE SUPPORT AGENCY, SOUTH AFRICA, 2016
(MACROECONOMIC FORECAST ANALYSIS IN NEPAL, NEPAL, 2020)
During the pandemic, Friedemann Gille wanted to understand the trajectory of all economic sectors in Nepal from the perspective of employment creating and economic growth potential. The team developed an economic forecasting model for all 14 economic sectors in Nepal and forecasted employment and economic growth trends from 2020 until 2024 using economic data from 2008-2019. The impacts of COVID-19 were explicitly considered within the model specifications.
During the pandemic, Friedemann Gille wanted to understand the trajectory of all economic sectors in Nepal from the perspective of employment creating and economic growth potential.
DNA Economics provided an overview of the macroeconomic and labour market context in Nepal, developed an economic forecasting model for all 14 economic sectors in Nepal and forecasted employment and economic growth trends from 2020 until 2025 using historical data on the number of individuals employed and the value of Gross Value Added in all sectors from between 2008-2019. The researchers further estimated the degree to which increased economic activity related to increased employment (i.e., the output-employment elasticity) in each economic sector.
The impacts of COVID-19 were explicitly considered within the model specifications.
The methodology used included
•Literature review
•Forecasting analysis using Structural Vector Autoregression (SVAR)
•Econometric modelling