Report back on the review of budgetary allocation for Land Reform

1. Report back on the review of budgetary allocation for Land Reform Standing Committee on Appropriations Friday, 2 September 2011 09h00-13h00 Committee Room V454, Old Assembly Wing

2. CONTEXT • The Committee requested the Department along with the National Treasury to meet with the intention to resolve challenges emanating from the spending trend of the Department . • The departments were also requested to review the budgetary allocation for the Land Restitution Programme. • The Committee also requested the department to provide a plan to improve Restitution and Land Reform expenditure performance.

3. Progress • The meeting was held with National Treasury • The meeting discussed areas of concern regarding the department expenditure trends, and • agreed that funding needs will be provided through the MTEF process. • The project on verification of outstanding claims in the Regional Land Claims Commission(RLCC) has started, it will be completed by 31 March 2012. • Although this project is not yet completed, the department is in a better position to provide estimates based on the progress made to date for the MTEF. • Pre-MTEC discussions are scheduled for Tuesday 30 August 2011.

4. Approach followed • The allocation for 2011/2012, allows for finalization of 360 backlog claims and only 90 new claims. It is expected that in the outer years, the baseline allocation will not be sufficient to settle all targeted claims. • The department requested additional funding for year 1 of the 2012 MTEF period which amounts to R2.3 billion for the Restitution programme, with carry though costs for the period. • This will allow the department to settle approved claims and those claims were offers are already made. • And be able to do further research on the new claims on the outer years.

5. Impact on Land Reform • A review of strategic and costing exercises and the 2011 MTEF submission was performed by all programme managers which resulted in a R1 billion reprioritisation from the Land Reform programme. The allocation was made to different programmes • The approval of additional funding for restitution will ensure that no further shifting of funds is done within the Land Reform Programme. It is the last shifting which will normalize the budget of the department for improved service delivery.

6. Presentation of Financial Performance as at 25 August 2011toStanding Committee on Appropriations

7. Performance per programme

8. Performance per economic classification

9. Conclusion • The Department has taken a strategic decision to prioritise financial compensation and state land. • A focus in the last quarter was to quantify claims on state land, there is no financial implication on such claims • The financial compensation are low in amount however there is a risk of paying fictitious beneficiaries, it is for this reason that control processes has been put in place which sometime may delay implementation. • We are continuously engaging National Treasury on challenges facing the department, and hope that the matters that resulted in continuous shifting of funds will be resolved. • Land restitution is complex, however the department remain committed to settle claims within a reasonable period with the limited resources available.

10. Thank you