DOJ&CD Budget and Expenditure Report

1. DOJ&CDBudget and Expenditure Report

2. 2011/12 Unaudited Budget and Expenditure Outcome Available Budget (excl NPA) R8,960,034m Less: Expenditure to date R8,954,212m Available funds R 5,822m Percentage expenditure 99,9%

3. Unaudited Expenditure per ProgrammeDOJCD - Vote

4. Unaudited Expenditure per Economic Classification: DOJ

5. Improved budget and expenditure outcome but …. Substantial strain on operational budgets – impact of efficiency gains budget cut by National Treasury (R724 million cumulative in 2012/13) Reduced operational budget and impact on service delivery –Suspension and/or delayed implementation of certain initiatives Outstanding commitments (R139 m) and accruals totaling (R490m) Roll over of expenditure – impact on new year appropriations Outstanding interdepartmental claims for property management (R77 m) and infrastructure (R171 m)

6. Understanding Government Resourcing and Public Sector Funding in the context of global economic situation Excessive accumulation of debt, which set the crisis in motion, has yet to be unwound. Debt burdens continue to weigh on growth in the United States and Europe. National budgets in many countries are under pressure, and limited fiscal resources are confronted by rising demand for social services and stimulus measures in the face of weaker growth. Widespread inequality, which has risen sharply in many countries, is fuelling public anger and political instability. Unemployment has increased, with the challenge of mass joblessness among youth placing many countries in a chronic predicament. Unsustainable social security arrangements are creating fiscal and financial instability – particularly in Europe.

7. The South African context: 2012 Budget Review Economic growth forecast to slow from 3.1% in 2011 to 2.7% in 2012, increasing to 4.2% by 2014 Consumer price inflation to rise from average of 5% in 2011 to 6.2% in 2012, declining to 5.1% in 2014 Wage settlements averaging 7,7 per cent against economic growth of 3,1 per cent 2009 recession Impact on Government Revenue – Sharp falls in corporate income tax, VAT, secondary tax on companies and customs duties Budget deficit of 4.6% projected in 2012/13, 4% in 2013/14 and 3% in 2014/15 •National government net loan debt projected to reach R1.5 trillion in 2014/15 Almost 15 million South Africans not economically active – broad unemployment rate at about 33 per cent

8. Thus…. Time to make difficult decisions We are living through a deep crisis that has exposed fault lines in the global economy. The pace and progress of recovery is uncertain. The threat of global contagion is still with us - Pravin J Gordhan The global environment poses considerable risks to the world economic recovery, and the outlook for our own economy ‘…We will begin to write a new story about South Africa – the story of how, working together, we drove back unemployment and reduced economic inequality and poverty.’ – President Zuma, 2012State of the Nation Address

9. ENE BUDGET ALLOCATIONS:Year on Year Growth Growth in 2012/2013 driven by increased provisions for appointments of judges and magistrates, carry through cost of salary increases , planned IT upgrades and funding for building of 2 high courts and other court infrastructure.

10. Reduced budget allocations … doing more with less… Reducing budgets …. but expected to absorb inflationary pressures and still expand services . The impact is essentially on operational funding with the personnel operational cost ratio now at 78:22.

11. BaselineAdjustments ENE 2012

12. Budget Allocations per Programme

13. Budget Allocations per Economic Classification

14. THE RESOURCING OF INDEPENDENT BODIES

15. FACILITIES MANAGEMENT

16. INTER DEPARTMENTAL PROGRAMMES • May not be used for other purposes than those specified

17. DEPARTMENTAL REVENUE • Departmental revenue is paid over to the fiscus National Revenue fund • Receipts are expected to increase due to implementation of TPF interventions

18. REGIONAL BUDGET ALLOCATIONS Budgets excludes Day-to-Day Maintenance, Upgrading of Infrastructure and GG Motor vehicle allocations

19. BRANCH BUDGET ALLOCATIONS

20. Funded Projects and Contingencies

21. Funded Projects and Contingencies

22. Funding of Policy Priorities: R41,0 million in 2012/13

23. 2012 Medium Term Budget allocations: DOJ&CD Programmes –Refer to slide 12

24. Programme 1: Administration

25. Programme 1: AdministrationProportional allocation: 2012/13 Corporate Services includes IT, Finance HR and Communication Office Accommodation includes leasing of accommodation and municipal rates and taxes

26. Programme 2: Court Services Growth in 2012/13 driven by additional allocations for facilities management – additional court infrastructure

27. Programme 2: Court ServicesProportional allocation: 2012/13 14 high courts 760 Lower courts Of which 369 Main Courts 56 Detached Courts 92 Branch Courts and 249 Periodical Courts Administration of courts refers to the funding of regional offices Facilities management includes funding for new court infrastructure, RAMP, day to day maintenance and Upgrading of infrastructure

28. Programme 2: Court Services Constitutional Court (Office of the Chief Justice) • The 2011/12 increase is as result of shifting the cost of the Judicial Education Institute to the Office of the Chief Justice • Additional Funding in this subprogramme includes the funding of the cost of the Judicial Service Commission as well as all International travel of Judges and Magistrates

29. Programme 2: Court Services Supreme Court of Appeal • The 2011/12 increase can be ascribe to the once off cash injection of R5,5 million to assist with operational cost pressures as well as the inauguration cost

30. Programme 2: Court Service High Courts • 34% of budget is spent on operational expenditure compared to 22% for lower courts • Major cost driver is Travel and Subsistence (on average 68% of Operational Budget)

31. Programme 2: Court ServicesHigh Courts: Primary Cost Drivers In 2010/11 High Courts spend R98,7 million on travel and subsistence outof an operational budget of R146,0 million.

32. Programme 2: Court ServicesHigh Court Expenditure : 2011/12

33. Programme 2: Court Services Lower Courts • Nominal growth of 3 % for lower courts compared to 5,5% for high courts • Impact of slow growth and efficiency gains cuts – reduced funding for capital expenditure at court level • Growth driven by higher personnel cost with personnel to operations ratio of 78: 22 The reduction in budget and expenditure in 2010/11 is a result of a 52% reduction in travel and subsistence expenditure (cost containment measure) from administrative support

34. Programme 2: Court ServicesPrimary Cost Drivers: All Courts Major cost drivers is Travel and subsistence, Telecommunication and Agency and outsource services (transcription, sheriffs and interpreters fees)

35. Programme 3: State Legal Services

36. Programme 3: State Legal ServicesProportional allocation: 2012/13

37. Programme 4: National Prosecuting Authority

38. Programme 4: National Prosecuting AuthorityProportional allocation: 2012/13

39. Programme 5: Auxiliary and Associated Services Please note the fluctuation in the funding of the SIU

40. Programme 5: Auxiliary and Associated Services Justice Modernisation includes DOJ&CD ICT spending and also funding of IJS interdepartmental initiatives, R147 million in 2012/13

41. Direct Charges: Judges and Magistrates Salaries The 2012/13 increase of 14% makes provision for the appointment of additional Judges and Magistrates

42. The End Thank You