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PRESENTATION TO THE NCOP FINANCE COMMITTEE MEETING 27 AUGUST 2008

This presentation to the NCOP Finance Committee on August 27, 2008 focuses on first quarter performance, property rates devolution, actual expenditure data, monitoring capacity, over/under spending, and capacity constraints in infrastructure grants to provinces. The presentation also details concerns regarding rate grants and expenditure related issues, along with examples of contract price adjustments and capacity constraints faced by the department. The challenges and future plans in areas like EPWP, gravel roads, maintenance backlog, and rising construction costs are highlighted.

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PRESENTATION TO THE NCOP FINANCE COMMITTEE MEETING 27 AUGUST 2008

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  1. PRESENTATION TO THE NCOP FINANCE COMMITTEE MEETING 27 AUGUST 2008

  2. CONTENTS First quarter performance on conditional grants • Devolution of property rate fund • Infrastructure grant for provinces • Trends in allocations, transfers & actual expenditure • Monitoring capacity 08/09 • Over / under spending • Capacity constraints

  3. INFRA GRANT TO PROVINCES 0% 17% 10%

  4. DEVOLUTION OF PROPERTY RATES GRANT 0% 10%

  5. DEVOLUTION OF RATES EXPENDITURE • The Province budget = R125,066 m • No expenditure to date • National Works did all payments till July 08 • New Payments only after receipt of new invoices after August 08

  6. CONCERNS IN RATE GRANT • The R125m was for 2700 properties; • The asset register has about 7500 properties. • Site visits confirmed the following: • Municipal records are incorrect (site nr, owner details) • Municipalities are not invoicing us on all our properties. • Maluti A Phufong NPW has only paid for 158 properties while the inspection revealed 470 properties.

  7. CONCERNS IN RATE GRANT • Municipalities indicated that they will implement the market related rates and taxes from next year. (Improvements included.) • Payment of rates & taxes on farms was excluded till now • Physical verification and reconciliations with municipalities to be done before accurate estimates are possible. • Agreements on tariffs, valuations, ownership, occupation

  8. INFRA GRANT EXP 1st QUARTER

  9. CONTRACT PRICE ADJUSTMENT

  10. EXAMPLE OF RISE IN BITUMEN PRICE

  11. CALEDON BRIDGE AT WEPENER Project Value: R110 million The new and the old

  12. Springfontein – Bethulie Project Value: R195 million

  13. Rehabilitation of SS18, Harrismith to Verkykerskop.Project value: R172 million

  14. Route 4 (Swartwater Dam)Project Value: R163 million Before Brick making

  15. Before Construction During Construction Project still under construction Rehabilitation N1 –Sasol Value: R255 million

  16. CAPACITY CONSTRAINTS • Funding • For continuing projects • For NYS and contractor development • For backlogs • For remaining flood damages • overspending • Experience in engineering and technical field • Training capacity for contractor development • Support for NYS • Established contractors at CIDB Levels

  17. Challenges • EPWP • Gravel roads • Overloading • Maintenance backlog • Rail revitalisation • Freight / HIV and AIDS / roads congestion • Rising cost of construction

  18. THANK YOU

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