Human capital remains an institution's vitality and strength and public institutions should co-ordinate human action for public interest and institutional effectiveness. It is important for managers to not only take cognisance of human resource challenges, but to also address them in order to apply human resources as a competitive advantage. When departments perform well, it is primarily due to the human capital's inspiration, enthusiasm, skills and reliability, combined with good leadership (World Public Sector Report, 2005:v). It is therefore imperative to take cognisance of the pivotal role that human resources play in an institution's effectiveness, productivity and performance. Public sector institutions are confronted with a number of challenges of which one of the largest is to retain good employees. Due to the fact that skilled, competent staff is in high demand in the public sector, it is important that strategic