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Purpose of the presentation

Presentation of the 4 th Quarter Financial Performance of the Department to the Standing Committee on Appropriations (SCOA) 24 August 2010. 1. Purpose of the presentation. To present the financial performance of the department for the 4 th quarter of the financial year ending 31 March 2010.

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  1. Presentation of the 4th Quarter Financial Performance of the Departmentto the Standing Committee on Appropriations (SCOA)24 August 2010 1

  2. Purpose of the presentation • To present the financial performance of the department for the 4th quarter of the financial year ending 31 March 2010. • To provide explanations on the unspent funds under Programme 2,Provision of Land and Accommodation and incentive grants under Programme 3. 2

  3. Total Department: Financial Performance per Economic Classification 3

  4. Breakdown of the Expenditure Capital Budget- Infrastructure • Roll over approved was for the following projects: • RKTP - R 54,285 million • Departmental – R 6,187 million • Land Port of Entry – R 17,101 million • Prestige – R 34,113 million • Adjustment budget of R 130 million was for Prestige accommodation for newly appointed Ministers and Deputy Ministers 4

  5. Reasons for under spending under theInfrastructure budget Departmental Budget • Delays related to the acquisition of prestige accommodation • Suitability and availability of houses • Price negotiation process Land Ports of Entry • Skilpadshek : Negotiations for the acquisition of a portion of property (tavern) required for the construction of the Border Post precinct delayed the execution of the project . Estimated under-expenditure. • Lebombo : The One Stop Border Post project initially planned for Lebombo had to be restructured into phases due to financial constraints and legal implications relating to operations and construction required on foreign territory. Estimated under-expenditure. 5

  6. Reasons for under spending under the Infrastructure budget cont. Re kgabisa Tshwane Programme: • Delay in obtaining approval for additional work for Government Garage project. • Delay in the procurement process to appoint consultants for the joint DPW and Tshwane Inner City Precinct Plan. 6

  7. Reasons for under spending under the Infrastructure budget cont. DOLOMITE : • Delay in procuring specialist consultants and contractors required to implement dolomite projects. ACCESSIBILITY : • Non responsiveness of the bidders delayed the appointment of service providers. • Cancellation of SAPS facilities from the program due to devolution process, which led re- prioritisation of buildings occupied by DPW. • Change of the initial scope of work. 7

  8. Year on Year Comparison- Capital Expenditure 86% 87% 57% 8

  9. Financial Performance per Programme Increased spending under Prog 3 relates to incentive grants which were not yet due at the end of Q3. 9

  10. Expenditure Analysis- Earmarked Funds 10

  11. Expenditure Analysis- Earmarked Funds Cont. 11

  12. EPWP incentive update 1 12

  13. 1.0 Introduction • The EPWP incentive has now been introduced to all sectors of the EPWP from the 10/11 financial year. • The Infrastructure sector incentive is applicable to Provincial Departments and Municipalities. • The Environmental sector incentive is applicable to National Departments through their appropriations from National Treasury. • The Non-state sector grant is paid to Non-Government Organisations ( NGOs) and Non-Profit Organisations through the Independent Development Trust ( IDT) which was appointed as the intermediary. • The Social sector grant has been paid as a schedule 5 grant to Provincial Departments of Social Development and Education. 13

  14. 2.0 EPWP infrastructure sector incentive progress for 09/10 financial year after the 3rd quarter of the 09/10 financial year ( paid in 4th quarter 09/10) • 5 out of the 16 Provincial Departments have been paid incentive payments totaling R 53,633 million considering 3rd quarter payment reports. Total payment to Provincial departments considering payments in previous quarters is R116.6 million out of an allocation of R 151.4 million (77% of Provincial allocation). • 47 of the 68 eligible municipalities have been paid their incentive payment of R 78.6 million considering the 3rd quarter report of the 09/10 financial year. Total incentive payment to municipalities after the 3rd quarter is R 114.17 million out an allocation of R 201.7 million ( 57% of Municipal allocation). • Total incentive payment to Provincial Departments and Municipalities made for the 09/10 financial year totals R 230.8 million, out of the total allocation of • R 352.1 million, representing expenditure of 66% of the allocation for the 09/10 financial year. 14

  15. Performance on the EPWP incentive grant by Provinces after 3rd Quarter 09/10 financial year ( paid in 4th quarter 09/10) 15

  16. Performance on the EPWP incentive grant by municipalities after 3rd Quarter 09/10 financial year ( Paid in the 4th quarter of the 09/10 financial year). 16

  17. 3.0 Performance on the EPWP infrastructure Incentive after the 4th quarter of the 09/10 financial year ( Paid in the 1st quarter of the 10/11 financial year) • 8 out of the 16 Provincial Departments will be paid incentive payments totaling R 54.551 million considering EPWP 4th quarter report for the 09/10 financial year . Total payment to Provincial departments considering payments in previous quarters is R171.132 million out of the full incentive allocation of R 201.892 million for 09/10 reporting ( 85% of the full allocation). This payment includes 4th quarter payment paid in the 10/11 financial year. • 36 out of the 68 of the eligible municipalities will receive a total incentive payment of R93.463 million considering the 4th quarter report for the 09/10 financial year. • Considering the 4th quarter report ( 3rd quarter for municipalities) 56 of the eligible 68 municipalities will have accessed R 207.61 million out of the available R 302.383 million available in the 09/10 municipal financial year ( 69% of the allocation for the municipal financial year). This is comparable to the 75% of allocation expected to be paid after 3 of the 4 quarters in the municipal financial year. 17

  18. The EPWP incentive grant is beginning to have the intended performance of encouraging Public bodies to exceed their Full Time Equivalent ( FTE) work opportunity targets. Provincial Departments in KZN, GP, WC and EC have exceeded their targets and have paid extra incentive amounts. • 11 of the 68 eligible municipalities in GP,KZN, LP, NW and WC have already exceeded their FTE targets by the 4th quarter of reporting ( 3rd quarter of municipalities) for 09/10. • The number of Municipalities that will access the incentive will increase to 126 municipalities in the 10/11 financial year from the 68 municipalities in the 09/10 financial year. 18

  19. 4.0 Progress of the Infrastructure sector incentive in the 10/11 financial year • For Provincial Departments, the incentive has been paid to 8 of the eligible departments in 5 provinces. R85.943 million will be paid out of the R330.67 million available for the 10/11 financial year considering 1st quarter reporting. This represents 26% of the Provincial allocation. • For Municipalities, 56 of the eligible Municipalities have been paid the incentive in all the Provinces. R 200.259 million of the R 622.996 million will be paid considering 1st quarter reporting. This represents 32% of the Municipal allocation for the 10/11 financial year. • Provincial Departments in Gauteng, Mpumalanga, Western Cape, Northern Cape and North West reported in the 1st quarter 10/11 but did not exceed the threshold for incentive payment. 19

  20. 4.1 Performance on the EPWP incentive grant by Provinces after 4th quarter 09/10 reporting 20

  21. 4.2 Performance on the EPWP incentive grant by Municipalities after 4th quarter 09/10 reporting ( 3rd quarter 09/10 for municipalities) 21

  22. 4.3 Performance on the EPWP infrastructure incentive by Provinces after the 1st Quarter of the 10/11 financial year reporting 22

  23. 4.4 Performance on the EPWP infrastructure incentive by Municipalities after 1st quarter 10-11 reporting 23

  24. 2.1 Performance on the EPWP infrastructure incentive by Provinces after the 1st Quarter of the 10/11 financial year reporting 24

  25. 2.1 Performance on the EPWP infrastructure incentive by Municipalities after 1st quarter 10-11 reporting 25

  26. 3.0 Non State Sector (NSS) Progress for the 2009/10 financial year • The final budget allocation for the NSS was R 204.5 m. This was the result of an additional allocation of R114.5m for the Community Works Programme (CWP) in the adjustment budget on the original budget ofR90m. • Included in the NSS allocation is a transfer of R14.5m to the Independent Development Trust (IDT) as the appointed intermediary to manage the NSS on behalf of DPW. • The allocation for the CWP was made up of wage costs and non-wage costs. The non-wage costs amount to R58.5m and the wage costs R91m • By the end of the 2009/10 financial year DPW had transferred the full allocation to the two programmes. 26

  27. 3.1 Community Works Programme Budget performance for the 2009/10 financial year Table : Site level expenditure, 2009/10 27

  28. 3.2 Non Governmental Organizations (NGOs) performance for the 09/10 financial year • The full allocation of R40.1 million was transferred to NGO’s participating in the institution based programme. • The full allocation is for wages at a rate of R50 per person per day. 28

  29. I thank you 29

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