Provincial Treasury Western Cape

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Provincial Treasury Western Cape
NCOP Select Committee on Finance Public Hearings
Conditional Grant and CAPEX 20 November 2006
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Outline

• Conditional grant, infrastructure and capital
  expenditure 2005/06
• 2006/07 second quarter expenditure
• Business plan 2006/07 and 2007/08 process and
• Monitoring provincial expenditure.

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Conditional Grant, Infrastructure and Capital
Expenditure 2005/06
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CG Expenditure 2005/06
Conditional Grant Expenditure 2005/06 2nd and
4th quarter
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CG Expenditure 2005/06 (2)
Although expenditure was below notional benchmark
of 50 per cent for some conditional grants
at the end of the 2nd quarter of 2005/06, by the
end of the financial year all grants had
performed well.
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Capital and Infrastructure Expenditure 2005/06
2005/06 - Infrastructure and capital expenditure
  Adjusted 4th quarter expenditure 4th quarter expenditure
R000's budget R'000
Education 373 808 362 645 97.0
Health 263 725 216 456 82.1
Agriculture 48 194 51 545 107.0
Transport and Public Works 1 173 815 1 166 869 99.4
Total 1 859 542 1 797 515 96.7
 
  Total 4th quarter expenditure 4th quarter expenditure
R000's available R'000
Payments for capital assets 1 443 962 1 479 235 102.4
Infrastructure and capital expenditure was at an
acceptable level at the end of the 2005/06
financial year
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2006/07 2nd Quarter Expenditure
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CG Expenditure - Agriculture
Agriculture Conditional Grant Expenditure as at
30 September 2006
  DORA 2006 Transfers received Spent by Province spent as of DORA Spent as transfers received
Land care programme 3 115 1 402 1 282 41.2 91.4
Comprehensive Agricultural Support Programme 20 648 9 292 4 133 20.0 44.5
Provincial Infrastructure Grant 3 000 1 533 4 585 152.8 299.1
Total 23 763 10 694 5 415 22.8 50.6
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CG Expenditure Agriculture (2)

• Challenges to Overcome
• Land Care Programme
• Expenditure is season dependent as invasive
  plants grow in summer and the eradication thereof
  can only take place once crops have been
  harvested
• Comprehensive Agriculture Support Programme
• Difficult to get community agreement on project
  plans
• Delay in tender process

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CG Expenditure - Education
Education Conditional Grant Expenditure as at
30 September 2006
  DORA 2006 Transfers received Spent by Province spent as of DORA Spent as transfers received
FET College Sector Recapitalisation 70 000 35 000 35 000 50.0 100.0
HIV and Aids (Life Skills Education) 11 870 5 936 7 047 59.4 118.7
National School Nutrition Programme 48 313 24 157 20 490 42.4 84.8
Provincial Infrastructure Grant 61 829 30 901 18 516 29.9 59.9
Total 192 012 95 994 81 053 42.2 84.4
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CG Expenditure Education (2)

• Challenges to Overcome
• National School Nutrition Programme Grant
• The reduction in the number of school days as a
  result of the winter school holidays has resulted
  in lower than expected expenditure
• Provincial Infrastructure Grant
• A number of projects are in the tender and
  awarding phase
• Seasonality of the Western Cape impacts
  infrastructure expenditure
• Department projects to spend entire budget by the
  end of the financial year

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CG Expenditure - Health
Health Conditional Grant Expenditure as at 30
September 2006
  DORA 2006 Transfers received Spent by Province spent as of DORA Spent as transfers received
National Tertiary Services 1 272 640 636 318 642 523 50.5 101.0
Health Professions Training and Development 323 278 161 640 161 640 50.0 100.0
Comprehensive HIV and Aids 115 670 57 836 61 449 53.1 106.2
Forensic Pathology Services 68 605 34 302 8 615 12.6 25.1
Hospital Revitalisation 149 703 74 850 59 366 39.7 79.3
Provincial Infrastructure Grant 61 829 30 901 22 907 37.0 74.1
Total 1 991 725 995 847 956 500 48.0 96.0
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CG Expenditure Health (2)

• Forensic Pathology Services
• Constraints in the appointing of staff for the
  Forensic Pathology Services Unit
• Hospital Revitalisation Grant
• Slow progress has been reported on large projects
  (Worcester, Paarl and Khayelitsha)
• The Department projects to spend the entire
  budget by the end of the financial year
• Provincial Infrastructure Grant
• Expenditure slow as a result of projects being
  put on hold in 2005/06
• Experienced professionals are leaving the
  department
• Seasonality of the Western Cape impacts
  infrastructure expenditure
• The Department projects to spend the entire
  budget by the end of the financial year

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CG Expenditure Local Government and Housing
Local Government and Housing Conditional Grant
Expenditure as at 30 September 2006
  DORA 2006 Transfers received Spent by Province spent as of DORA Spent as transfers received
Integrated Housing and Human Settlement Development 598 800 360 000 362 225 60.5 100.6
Expenditure on the IHAHSDG is higher than
transfers received
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CG Expenditure Transport and Public Works
Transport and Public Works Conditional Grant
Expenditure as at 30 September 2006
  DORA 2006 Transfers received Spent by Province spent as of DORA Spent as transfers received
Provincial Infrastructure Grant 126 329 63 157 30 615 24.2 48.5

• Challenges to Overcome
• Provincial Infrastructure Grant
• - A large number of projects are in the tender
  and
• design stage
• Seasonality of the Western Cape impacts
  infrastructure expenditure
• Department projects to spend entire budget by the
  end of
• the financial year

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CG Expenditure Cultural Affairs and Sport
Cultural Affairs and Sport Conditional Grant
Expenditure as at 30 September 2006
  DORA 2006 Transfers received Spent by Province spent as of DORA Spent as transfers received
Mass sport and Recreation Participation Programme 12 100 7 128 3 244 26.8 45.5
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CG Expenditure Cultural Affairs and Sport (2)

• Challenges to overcome
• Mass Sport and Recreation Participation Programme
  
• 20 new hubs funded from April 2006/07
• Currently, stipends only being paid for 11 hubs
  which are already in place
• Payment of stipends for 20 new hubs will commence
  in October 2006, backdated to August 2006

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Infrastructure and Capital Expenditure
Infrastructure and capital expenditure as at 30
September 2006
  Adjusted Second Quarter Expenditure Second Quarter Expenditure
R000's budget R'000
Education 279 476 109 510 39.2
Health 324 946 112 609 34.7
Agriculture 50 535 16 792 33.2
Transport and Public Works 1 314 717 490 323 37.3
Total 1 969 674 729 234 37.0

  Total 1st quarter expenditure 1st quarter expenditure
R000's available R'000
Payments for capital assets 1 616 771 564 912 34.9
Infrastructure expenditure includes maintenance
which is recorded as current expenditure in SCOA
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Infrastructure and Capital Expenditure

• Challenges to Overcome
• Bottlenecks in the procurement process, IDIP aims
  identify these bottlenecks and identify means to
  overcome them
• Inefficiencies in the link between planning
  budgeting and implementation and
• Skills shortage.
• Measures instituted
• Promotion of earlier planning cycle (IDIP).

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Conditional GrantBusiness Plans 2006/07
Financial Year
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CG Business Plans

• Business plans 2006/07
• All business plans for 2006/07 have been approved
• Business plans 2007/08
• Department of Agriculture
• Land Care Grant
• Business plan submitted, awaiting feedback from
  National Department.
• Comprehensive Agriculture Support Programme
• Business plan submitted to the national
  department

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CG Business Plans 2007/08

• Department of Education
• HIV and Aids (Life Skills Education) Grant
• Business plan submitted, awaiting feedback from
  National Department of Health
• National School Nutrition Programme Grant
• Business plan submitted, feedback received from
  national department
• Further Education and Training
• DORA requires submission to be made by 25
  November 2006, first draft will be ready for
  submission by 22 October 2006

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CG Business Plans 2007/08

• Department of Health
• Comprehensive HIV and Aids Grant
• Business plan submitted, awaiting feedback from
  the national Department of Health
• Forensic Pathology Services Grant
• Business plan completed in consultation with
  national Department of Health and submitted 23
  October 2006
• Signed copy submitted 17 November 2006
• National Tertiary Services Grant
• Awaiting Service Level Agreement from National
  Department of Health
• Health Professions Training and Development Grant
• Business plan format in process of finalisation
  by Department of Health

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CG Business Plans 2007/08

• Department of Local Government and Housing
• Integrated Housing and Human Settlement
  Development Grant
• Business plan submitted, awaiting feedback from
  national department
• Department of Cultural Affairs and Sport
• Mass Sport and Recreation Participation Programme
  Grant
• Business plan submitted, awaiting feedback from
  national department
• National Treasury
• Provincial Infrastructure Grant
• Consolidated infrastructure plan submitted to
  National Treasury

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Monitoring Provincial Expenditure
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Monitoring Provincial Expenditure

• Continuous engagements with departments in a
  cooperative manner to jointly seek solutions
• Quarterly reports to Top Management, Exco and
  Legislature
• Frequent interaction with departments on spending
  performance and general issues as highlighted by
  monthly IYMs
• Quarterly narrative reports to AOs and CFOs
• Quarterly meetings between MECs for finance,
  education, health and public works to discuss
  infrastructure spending and other difficulties
• Specific provincial initiatives to ameliorate the
  March spike and
• CFO intergovernmental forums.

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Discussion