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Department of Public Works presentation on Devolution of Property Rates Conditional Fund Grant to Provinces NCOP Select Committee on Appropriations 12 September 2012 By Acting Chief Financial Officer Ms. Sue Mosegomi. Presentation Outline. Background Budget vs Expenditure

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Presentation Outline

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  1. Department of Public Works presentation on Devolution of Property Rates Conditional Fund Grant to ProvincesNCOP Select Committee on Appropriations12 September 2012By Acting Chief Financial Officer Ms. Sue Mosegomi

  2. Presentation Outline • Background • Budget vs Expenditure • Devolution of property rates 2012-13 4. Expenditure Report: April – July 2012 5. Progress: payment of intergovernmental debt 6. Challenges Experienced by the Provinces & National Public Works 7. Proposed Way Forward NCOP SCOA - 12 SEPTEMBER 2012

  3. BACKGROUND • Prior to 1994, DPW was deemed the custodian of most state-owned properties and therefore took the responsibility for payment of property rates. This practice continued notwithstanding the separation of ownership of state land between Provincial and National Departments as determined by the Constitution. • As from the 1st April 2008, the function to pay property rates on behalf of the Provinces was transferred. NCOP SCOA - 12 SEPTEMBER 2012

  4. BUDGET vs EXPENDITURE NCOP SCOA - 12 SEPTEMBER 2012

  5. Devolution of Property Rates Grant – 2012/13 NCOP SCOA - 12 SEPTEMBER 2012

  6. ACTUAL EXPENDITURE NCOP SCOA - 12 SEPTEMBER 2012

  7. PROGRESS ON PAYMENT OF INTERGOVERNMENTAL DEBT • Section 71 report publication as at December 2011 shows progress, in that Government debt, as at September 2011 amounted to R3,9 billion and has decreased to R3.5 billion in December 2011 • On the 3rd June 2011 the National Steering Committee was established to act on government debt. • The Steering Committee comprises CoGTA, DPME, National Treasury and National Public Works. • Government debt reported includes property rates arrears prior to the Devolution of the Property Rates Fund Grant. • The municipalities submitted a debt of R 443 million for rates, which NDPW is in a process of verifying before payment can be made. NCOP SCOA - 12 SEPTEMBER 2012

  8. Prior Devolution Debt – in a process of verification and payment NCOP SCOA - 12 SEPTEMBER 2012

  9. Challenges Experienced by the Provinces & National Public Works • Late receipt of invoices from municipalities • Some municipal valuation rolls are incomplete. • Audit queries (concurrent mandate) • Lack of staff capacity in some small municipalities. • Some municipalities continue to bill rates and taxes and utilities jointly, thus results in reconciliation process being done. • Other municipalities do not submit their invoices/schedules at all. • Incorrect billing. NCOP SCOA - 12 SEPTEMBER 2012

  10. Proposed Way forward • Strengthening of Municipal forums for effective interactions with both National and Provincial Public Works to address intergovernmental debts, billing systems, interest rates among others. • Payment of arrears prior to Devolution process • Payment of arrears and Asset Register enhancement programmes for both National and Provincial Public Works • Signing of protocols with Provincial Department on Performance Management related to DORA allocations NCOP SCOA - 12 SEPTEMBER 2012

  11. THANK YOU NCOP SCOA - 12 SEPTEMBER 2012

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