Province of the Eastern Cape

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• Province of the Eastern Cape
• Department of Health
• Select Committee on Finance
• 2nd Quarter Spending on Conditional Grants and
  CAPEX
• 13 November 2007

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2006/07 Audit Outcomes

• The Department received an adverse opinion from
  the Auditor General
• The areas of concern revolved around Financial
  and Human Resource management / control
• In response to that, the Department is
  implementing an Audit Intervention Process,
  driven by Finance and Human Resource Turnaround
  Project Plans approved by Provincial Treasury

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Trends on Allocations
CONDITIONAL GRANTS CONDITIONAL GRANTS CONDITIONAL GRANTS CONDITIONAL GRANTS CONDITIONAL GRANTS CONDITIONAL GRANTS
Grant 03/04 04/05 05/06 06/07 07/08
  R'000 R'000 R'000 R'000 R'000
NTSG 195,504 272,036 353,022 374,203 428,912
HPTD 79,873 97,464 127,566 133,392 133,944
Comprehensive HIVAIDS 38,934 98,970 159,005 232,021 233,204
Forensic Pathology Services 1,000 - 8,866 91,867 68,135
Hosp Revitalization 90,751 116,354 147,732 125,071 246,750
Prov Infra Grant         150,000
TOTAL 406,062 584,824 796,191 956,554 1,260,945
Percentage growth 44.02 36.14 20.14 31.82
The department received for the first time, a portion of the Provincial Infra Grant The department received for the first time, a portion of the Provincial Infra Grant The department received for the first time, a portion of the Provincial Infra Grant The department received for the first time, a portion of the Provincial Infra Grant The department received for the first time, a portion of the Provincial Infra Grant The department received for the first time, a portion of the Provincial Infra Grant
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Budget vs Expenditure
2007/08 Conditional Grants Appropriated Budget Total Expenditure up to 30 Sept 2007 Spent
  R'000 R'000
Comprehensive HIV AIDS 233,204 96,361 41.3
Forensic Pathology Services 68,135 48,910 71.8
Health Professions Training Development 133,944 49,333 36.8
Hospital Revitalization 246,750 93,069 37.7
National Tertiary Services 428,913 165,229 38.5
Provincial Infrastructure Grant 150,000 75,160 50.1
TOTAL 1,260,945 528,062 41.7
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2 EXPENDITURE ANALYSIS CONDITIONAL GRANTS

• HIV AIDS grant was under-spent by 8.3.
• Forensic Pathology Grant was over-spent by 21.8
• HPTD Grant was under-spent by 13.2
• Hospital Revitalization Grant was under-spent by
  12.3
• National Tertiary Services Grant was under-spent
  by 11.5
• Provincial Infrastructure Grant was on track at
  50.1

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Comprehensive HIV AIDS

• The HIV AIDS Conditional Grant was under-spent
  by 8.7 as at 30 September 2007. The major reason
  for the under-expenditure was as follows
• Due to various reasons, the business plan was
  only approved at the end of June 2007. This meant
  that the implementation of planned activities
  could only commence in earnest in the 2nd Quarter
• The main challenges relate to provision of tests
  through NHLS and supply of ARV drugs for infected
  people. Activities were planned for 40 000
  patients/ recipients. However, to date the
  headcount is 35 376. Projecting forward, one can
  see that there will be a gross shortage of
  funding to carry out this critical activity.

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Forensic Pathology

• As at 30 September 2007, the grant was over-spent
  by 21.8. The reasons for the over-expenditure
  were the following
• Due to the contractual obligation to the project
  manager (Coega Development Corporation) for the
  2006/07 financial year, the Department had to
  transfer R 31 Million to the company in the
  current financial year.
• A roll-over request for 2006/07 unspent funds (R
  51,853 Million) has been lodged with the National
  Department of Health and Provincial Treasury.
• Achievements thus far are
• All personnel have been appointed
• Vehicles have been leased from Fleet Africa with
  another 22 expected by January 2008.
• 11 mortuaries are already under construction with
  a further 3 due to start construction in
  November.

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Health Professionals Training Development

• On a benchmark of 50, the Health Professionals
  Training Development (HPTD) grant under-spent
  by 13.2 due to the following reason
• Transfer of funds to Walter Sisulu University for
  the 2nd quarter were withheld due to
  non-submission of progress reports
• Service Level Agreement with Rhodes University
  for Doctorate in Pharmacy Programme was only
  finalised in October.
• Achievements thus far include
• R7 Million worth of capital equipment procured
  for eHealth
• 7 students are on the Doctorate in Pharmacy
  Programme

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National Tertiary Services Grant

• The grant was under-spent by 11.5 from benchmark
  of 50. The main contributor is capital spending
  under MTS for Oncology Services. This is driven
  by National Department of Health.
• Achievements thus far are
• The launch of a Drug down-referral programme in
  East London to strengthen access to drugs
• The launch of a Clinicians Forum to strengthen
  involvement of Clinicians in Tertiary Services
  Planning, and to improve quality of care
• Port Elizabeth Hospital Complex has received
  Theatre and Radiotherapy equipment.
• East London Hospital has received the Cobalt
  Source necessary for the treatment of cancer
  patients
• Tertiary cases managed exceeded the set targets
  for OPD headcounts, Inpatient days and Inpatient
  separations
• The main challenge is to secure funding in order
  to extend Oncology Services to Nelson Mandela
  Academic Hospital

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Revitalization Grant

• The Revitalization Grant under spent by 12.3.
  The main reasons are
• The Gateway Clinic in St Patricks Hospital could
  not take off due to the Municipality not
  approving the issue of land timeously.
• Tenders for the building of Doctors houses at
  Madzikane KaZulu Memorial Hospital could not be
  sold because of the industrial action. This
  delayed the commencement of construction
• Construction in the following hospitals is
  underway and on schedule Frontier, St Lucys,
  Madzikane KaZulu, St Patricks and St Elizabeth.
• The main challenge is business cases which have
  not yet been approved. The impact is that
  revitalisation of Port Elizabeth Provincial, Dora
  Nginza, Livingstone, Cecilia Makiwane, Frere and
  Mthatha General Hospitals will not take place.
  This is of great concern as these hospitals are a
  provincial priority with respect to the readiness
  of the Department for the 2010 World Cup

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Trends on Allocations
INFRASTRUCTURE (Equitable Share and Conditional Grants) INFRASTRUCTURE (Equitable Share and Conditional Grants) INFRASTRUCTURE (Equitable Share and Conditional Grants) INFRASTRUCTURE (Equitable Share and Conditional Grants) INFRASTRUCTURE (Equitable Share and Conditional Grants) INFRASTRUCTURE (Equitable Share and Conditional Grants)
03/04 04/05 05/06 06/07 07/08
  R'000 R'000 R'000 R'000 R'000
Buildings and other fixed structures 361,858 343,887 433,242 469,909 632,247
Machinery and equipment 163,808 26,782 21,265 115,425 274,617
TOTAL 525,666 370,669 454,507 585,334 906,864
Percentage growth -29,49 36.14 28.78 54.93
The department received for the first time, a portion of the Provincial Infrastructure Grant The department received for the first time, a portion of the Provincial Infrastructure Grant The department received for the first time, a portion of the Provincial Infrastructure Grant The department received for the first time, a portion of the Provincial Infrastructure Grant The department received for the first time, a portion of the Provincial Infrastructure Grant The department received for the first time, a portion of the Provincial Infrastructure Grant
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Budget vs Expenditure
2007/08 Infrastructure Appropriated Budget Expenditure as at 30 Sept 2007 Spent
Total Expenditure 906,864 362,481 40.0
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I
Analysis of expenditure Infrastructure

• Capital expenditure at 40 is 10 below the
  benchmark of 50. This is due to Revitalisation
  under-expenditure (dealt with under
  Revitalisation)
• Expenditure for Infrastructure as at 31 October
  has risen to 65
• Works orders to the value of R30m have been
  issued and contractors are on site for the
  following projects Alfred Nzo Mthatha Chris
  Hani East London and Humansdorp.
• Achievements
• 11 new clinics built with a further 49 being
  upgraded
• 60 clinics have been provided with essential
  equipment

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Monitoring Capacity Reporting

• A formal Monitoring Evaluation (M E) system
  is functional and being improved upon where
  deemed necessary.
• M E practitioners have been recruited to
  populate the M E structures at Head Office. A
  roll out plan for the Districts and Complexes is
  currently being carried out.
• Monthly reporting on service delivery and
  programme implementation as well as site visits
  are done.
• Budget expenditure review meetings take place
  fortnightly

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Conclusion

• The department is confident that all allocated
  funding will be spent by the end of the financial
  year
• Close monitoring of expenditure is a priority