1 / 32

2005/06 Fourth Quarter Report on Conditional grants and CAPEX

2005/06 Fourth Quarter Report on Conditional grants and CAPEX. Select Committee on Finance Gauteng Treasury 02 May 2006. Content of Presentation. Total spending for 2005/06 FY Conditional grants spending CAPEX spending Challenges moving forward Provincial Treasury’s Intervention.

Download Presentation

2005/06 Fourth Quarter Report on Conditional grants and CAPEX

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. 2005/06 Fourth Quarter Report on Conditional grants and CAPEX Select Committee on Finance Gauteng Treasury 02 May 2006

  2. Content of Presentation • Total spending for 2005/06 FY • Conditional grants spending • CAPEX spending • Challenges moving forward • Provincial Treasury’s Intervention

  3. 2005/06 total spending

  4. Provincial summary for 2005/06 Provincial aggregate • Total spending equals R33,4b which translates to 97% of the adjusted budget • Net underspending amounts to R885m and represents 3% of adjusted budget • Depts. contributing to underspending incl. • Education – R395m • Social Development – R424m • Housing – R91m • Finance – R71m • Dept showing significant overspending • Health - R132m

  5. Provincial summary for 2005/06 • Depts. contributing to underspending incl. • Education R395m • Vacant public servants posts not filled • Delays in the implementation Integrated Quality Management System due to current disputes i.e salary progression and incentives • Social Development (R424m) • Saving due to less intake of beneficiaries • Housing (R91m) • Goods delivered late in the financial year. • Finance (R78m) • Claims received late from depts. for GPG Precinct • Unfilled posts due to late approval of the structure • Dept showing significant overspending • Health (R132m) • Early delivery of equipment expected in 06/07

  6. 2005/06 total conditional grants

  7. 2005/06 total conditional grants

  8. Provincial summary for 2005/06 Total conditional grants expenditure • Adjusted budget amounts to R11,4b • Includes provincial rollover R32,7m • Total expenditure amounts to R10,7b and translates to 94% of the adjusted budget • Total amount received equals R10,766b instead of R11,340b • Reduced transfers (R297m) due to revised payment schedule for social assistance grant; low number of beneficiaries • Stopping of 3 infrastructure installments (R277m) due to low level of spending on infrastructure, late submission of infrastructure reports and plans and submission of incomplete/inaccurate reports • Province reflects an underspending of R606m or 6% of the adjusted budget

  9. Conditional grants spending per dept. • Agriculture, Conservation & Environment • Dept manages Land Care and Comprehensive Agricultural Support programme (CASP) • Land Care – prevention of degradation of natural resources • Adjusted budget – R2,2m; • Includes provincial rollover of R185,000 • Total received from National – R2m • Expenditure amounts to R2,m or 93% of the budget • Reason for underspending • delays in processing the quotations packages by the implementing agents due to noncompliance with specifications

  10. Conditional grants spending per dept. • CASP – assisting beneficiaries with land reform program • Total Adjusted Budget - R5,7m • Full allocation received as per payment schedule • Spending amounts to R4,5m and translates to 80% of the budget • Reasons for underspending • service providers were too slow in implementing the projectsdue to lack of service level agreements

  11. Conditional grants spending per dept cont. • Education • Dept administers two cond. grants i.e HIV/AIDS & School nutrition • HIV/AIDS • Adjusted budget – R21,7m & includes the provincial rollover of 2,8m • Total received from National – R18,90m • Actual spending amounts to R22,2m or 102% of the budget • Reason for overspending • Incorrect allocation to be corrected before financial year closure

  12. Conditional grants spending per dept cont. • NationalSchool Nutrition • Adjusted budget – R101,7m • Includes the provincial rollover of R581 000 • Total amount received from National – R101,1m • Expenditure incurred until March amounts to R91,6m or 90% of the budget • Reason for underspending • Delays in the delivery materials such as containers and kitchen equipment

  13. Conditional grants spending per dept cont. • Social Development • Manages four cond. grants i.e HIV/AIDS, Integrated Social Development, Social Assistance Administration and Social Assistance Transfer • HIV/AIDS • Adjusted budget – R20,3m • Total budget received as per payment schedule • Total expenditure R20,3m or 100% of the budget

  14. Conditional grants spending per dept cont. • Integrated Social Development • Adjusted budget – R27,9m • Full allocation received • Actual spending amounts to R22,2m & translates to 79% of the budget • Underspending attributed to • Business plan approved in August 2005 • Transfers to service providers was reduced due to non-compliance • Social Assistance Administration • Adjusted budget – R350m • Full allocation received • R293m spent as at end of March or 84% of the budget • Reason for underspending • Administration less due to low take up rate of beneficiaries

  15. Conditional grants spending per dept cont. • Social Assistance Transfer • Adjusted budget – R6,5b • R6,2b received & less by R297m at year end • Due to revised payment schedule during the year • Total expenditure R6b or 93,9% of the budget or 98% funds received • Reasons for recording a saving • Decrease in the number of applications for grants • Indemnity campaign by national dept • Clean up exercise by province

  16. Conditional grants spending per dept cont. • Sports, Recreation, Arts and Culture • Mass Sport and Recreation programme • Adjusted budget – R2,7m • Total received – R2,7m • Total expenditure R2,1m or 80% of the budget • Reason for underspending • Computers and printers in Hubs not delivered on time

  17. Conditional grants spending per dept cont. • Health • Responsible for HIV/AIDS, Hospital Management & Quality Improvement, Integrated Nutrition Programme, Hospital Revitalisation, Forensic Pathology Services • HIV/AIDS • Adjusted budget – R185m • Total budget received • Actual expenditure amounts to R207m or 112% of the budget • Overspending due to • Increase in the number of patients requiring ARV’s (target was 25000 and they reached 38000).

  18. Conditional grants spending per dept cont. • Hospital Management & Quality Improvement • Adjusted budget – R18,5m • Full allocation received • R4,3m spent & translates to 23% of the budget • Reason for underspending • Business plan approved in November 2005 • Revised business plan submitted later but not all projects were approved • Integrated Nutrition Programme • Adjusted budget – R11,3m • Full budget transferred to the province • Spending to date R9,8m or 87% of the budget • Underspending due to • Nutritional supplements ordered and delivered was not according to specifications

  19. Conditional grants spending per dept cont. • Hospital Revitalisation • Adjusted budget – R88,9m • Full budget transferred to the province • Full allocation spent i.e 100% of the budget • Forensic Pathology • Adjusted budget – R16,9m • Full budget transferred to the province • Total amount spent R1,5m or 8,6% of the budget • Reason for underspending • Full allocation received during the adjustment • Equipment orders placed but not yet delivered • Process of transferring staff & assets from SAPS has not been finalized

  20. Conditional grants spending per dept cont. • Housing • Manages 3 conditional grants, i.e Integrated Housing & Human settlement, Human Settlement and Alexandra Urban Renewal • Integrated Housing & Human settlement • Adjusted budget – R1,3b & includes provincial rollover of R9m • Total received – R1,3b • Total expenditure R1,3b or 100% of the budget

  21. Conditional grants spending per dept cont. • Human Settlement • Adjusted budget – R7,3m & includes provincial rollover of R3,2m • Total received – R4,1m • Total expenditure R4,5m or 81% of the budget • Reasons for underspending • Misallocation of expenditure. Pre-final IYM will reflect the corrections (which will translate to 100% expend) • Alexandra Urban Renewal • Adjusted budget – R14,2m & includes provincial rollover of R6,2m • Funds transferred – R8m • Total expenditure R14,2m and translates to 100% of the budget

  22. Conditional grants spending per dept cont. • Provincial Infrastructure grant • Receiving depts. are Health, Education and Transport • Adjusted budget amounts to R369m • Only first installment received R92m; last three installments withheld • Total expenditure R250m or 65% of the budget • Health - R73m spent • Education – R38m spent • Transport – R139m spent • Reasons for not receiving the full allocation • low spending on infrastructure, late submission of infrastructure reports and plans and submission of incomplete/inaccurate reports

  23. 2005/06 total capital spending

  24. Provincial summary for 2005/06 Total capital expenditure • Total spending amounts to R2,4b and represents 116% of the adjusted budget • Report shows an overspending of R334m • Depts. contributing to overspending incl. • Health – R122m • Transport – R344m • Depts. showing an underspending incl. • Education – R69m • Housing – R39m • Finance – R27m

  25. Capital spending per dept • Health • Adjusted Budget R847m • Expenditure to date amounts to R969m i.e or 114% of the budget • Reason for overspending • Early delivery of equipment expected in 06/07 FY

  26. Capital spending per dept • Education • Total adjusted budget amounts to R585m • Total spending R516m & represents 88% of the budget • Spending during the year was slow due to procurement challenges, but picked up in the last quarter • Increase in spending due • Money transferred to IDT in Feb to build 23 schools • Mobile schools purchased in January • Appointed a project management company to facilitate the process of ensuring that projects are delivered on time • Reasons for underspending • Incorrect allocation of GautengOnline payments under current objective.

  27. Capital spending per dept • Transport and Public Works • Adjusted budget – R407m • Spending – R756m or 185% of adjusted budget • Overspending occurred due to • Misallocation of goods and services under capital which is being rectified.

  28. Capital spending per dept • Housing • Adjusted budget - R42,6m • Actual expenditure – R3m or 7% of the budget • Reasons for underspending • Misallocation of capitalised compensation under current objective. • Late purchasing of new furniture

  29. Capital spending per dept • Social Development • Adjusted budget amounts to R13m • Expenditure at the end of March equals to R10,6m and represents 80% of the budget • Reasons for underspending • Delays in ordering equipment - this is due to lack of proper planning

  30. Challenges moving forward • Submission of quarterly reports i.e conditional grant and infrastructure report • most times either late/ partial submission/ not submitted • Submissions are in most instances incomplete and inaccurate • makes comparison between IYM & performance achievements difficult/ impossible • Credibility of departmental projections in IYM • Strengthening of monitoring and evaluation of performance by depts. • Misallocations of expenditure. Depts. Currently passing journals • CFO’s offices not properly capacitated

  31. Provincial Treasury’s Intervention • Continue to hold individual meetings with departments showing significant underspending and overspending • Conduct training and address identified gaps • Create a public finance unit that will specifically focus on • monitoring the departments spending and evaluating their performance • Ensuring value for money and efficiency • Detailed analysis & interrogate depts. expenditure • Providing guidance and advise depts. on any issues relating to budgets, spending and delivery • Identify training needs and provide it where necessary • Financially assist departments to capacitate their CFO’s offices • Introduction of non-compliance strategy

  32. THANK YOU!!!

More Related