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This report presents the performance of conditional grants and capital expenditure in the North West province from April 1st to June 30th, 2008. It provides an overview of the provincial budget, expenditure on conditional grants and infrastructure funds, and the spending patterns in various departments.
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North West provincial Treasurypresentation on Conditional Grants and Capital Expenditure as at 30 June 2008
Introduction • The report on the performance of conditional grants and capital expenditure covers the period 1st April 2008 to the 31st June 2008 • Expenditure for this period under review is based on the straight line assumption of 25%.
Provincial Summary • The provincial main budget for 2008/09 is R16,937 billion. • Spending for the 1st quarter amounts to R3,811 billion or 22,5%. • The conditional grant budget for the 2008/09 financial year is R2,5 billion . • Expenditure on the conditional grants for the 1st Quarter amounts to equals R429,8millon or 17%. • Amounts transferred in terms of the DORA is R746 million, the province spent R429,8 million which equals 58% expenditure.
Provincial Summary – Infrastructure Funds • The infrastructure budget equals R2.5 billion for the 2008/09 financial year. • Expenditure on the Infrastructure funds equals 17% of approved budget which is 8% short on the estimated 25%.
NW Office of the Premier – Infrastructure Funds • The Office of the Premier has spent 36% of their approved budget. • Spending is progressing well with the unspent funds already committed to complete the maintenance and construction of traditional council offices. • Project will be completed by the 31 July 2008.
NW Department of Health CONDITIONAL GRANTS SPENDING • Average spending of 17% on conditional grant has been registered under Health • Hospital Revite: Slow progress in Hospital that should have been completed namely Moses Kontane, Vryburg Hospital. • Professional training and development: Reclassification of business plan delayed implementation process. • HIV/AIDS: Late transfer of funds from National and late submission of business plans from NGO’s delayed spending. • Forensic Pathology: The unspent funds are reserved for the building of mortuary at Kerksdorp/Tshepong Hospital.
NW Department of Health • Receipt of maintenance plans late from DPW subsequent the reprioritization processes • Inconvenient procurement process- delayed payment processes. • Delays in finalising sites for clinics • Cancellation of contracts due to non performance of contractors.
NW Department of Sport, Arts and Culture • The Community Library Services Grant spent a mere 6% as a result of the late planning, tendering procedures, staff recruitment and training. • Spending on the Mass sport and recreation Grant seems problematic. The funds has apparently been divided between the department’s new regional offices and no spending is taking place. • The spending on the archive building projects is significantly going well at 76.01 %. • Department of Public Works is addressing the matter of Khuma library site that belonged to Health to allow spending on libraries.
NW Economic Development and Tourism • The none spending on MIDZ is as a result of the land issue for erecting MIDZ infrastructure. • The operating permit not yet approved by the Department of Trade and Industry (DTI) .
NW Department of Education • Low spending due to late delivery of HIV/AIDS material, spending has since improved. • Infrastructure grant – delay in finalisation of budgets, reprioritisation of projects and plans, contractors are now on site. • Delays in finalisation of plans for sanitation and fencing of schools, projects are at tender stage. • Nine (9) projects for minor and major renovations have now started, the projects will be completed in 3 months time.
NW Department of Local Government and Housing • Low spending on Integrated Housing were as a result of the delay in registering contractors with NHBRC and this impacted negatively on the implementation and delivery of projects. • The zero expenditure on the Bucket replacement was due to the lack of readiness by Municipalities in terms of capacity. Municipalities has to first erect the structures and claim the funds from the department. • With regard to Disaster Management: Municipalities were not readily available with the business plans and as a result no transfer payments could be made.
NW Department of Transport, Roads and Community Safety • The low spending pattern on the infrastructure is due to reprioritization of projects and delays in the tendering processes. • Low spending on the EPWP and maintenance projects is due to transformation of the implementation of EPWP processes, hence project delivery was delayed.
NW Department of Public Works • Devolution of Property rates & Taxes: The 1st transfer from National will be effected only in August 2008, the total budget is R58 million. • Monitoring and evaluation on projects are being fast tracked due to implementation of IDIP delivery processes. • Slow spending on maintenance has been registered as a result of lack of capacity and poor communication between client departments and the agent. As a remedial measure, the IDIP focus will now be on maintenance.
NW Department of Social Development • Secure care centres under spending is due to the delay in finalizing the construction of the wall and the special fencing. • Substance abuse centre: The purchase of a building for the substance abuse centre for in-patients will be completed in November 2008 and renovations will be completed within three months thereafter.
NW Department of Agriculture, Conservation and Environment The Department has spent 5% due to lack of the necessary capacity to design specifications and implement projects. • The tender for the outsourcing of the design of specifications and appointment of Engineers will be finalised in Septemeber 2008 • The outsourcing the service will address the spending on Land Care & Comprehensive Agricultural Support and Settlement Support.
Concluding Remarks • Although the total spending by the province seems to be fair, special attention has to be paid in addressing the spending on conditional grants and infrastructure. • At this point in time the province does not have any surplus funds to assist departments with budget pressures . • Provincial Treasury has set special meetings with MECs and Heads of Departments of the affected departments to address the issues of under spending of allocated budgets. • Monthly presentation and discussion of expenditure reports at Heads of Department meetings empowers departments to addressing the gaps that attributes to under spending.
Concluding Remarks • The rollout of the Infrastructure Delivery Improvement Programme (IDIP) within the province and the active involvement of the Provincial Treasury with the Provincial Departments of Education, Public Works and Health and the National Treasury definitely revealed positive results in the infrastructure planning, delivery and management. • The NW provincial treasury continues to meet provincial departments regularly to facilitate the acquiring of resources, requisite skills to improve budget planning and spending capacity and to address areas where there are risks of both over and under spending. THANK YOU
