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PRESENTATION TO THE SELECT COMMITTEE ON FINANCE

13TH FEBRUARY 2007

KWA-ZULU NATAL DEPARTMENT OF EDUCATION: HEARINGS ON CONDITIONAL GRANTS AND CAPITAL EXPENDITURE OF DEPARTMENTS

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INFRASTRUCTUREPROGRAMME

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2006/07 Q3 EXPENDITURE ANALYSIS

Quarter 2006/07 Cumulative Target

2006/07 Cumulative Target

% of Budget Actual

2006/07 Actual

(ex BAS)

2006/07 Actual

% of Budget

Q1 119,000 16,87% 13,056 1,85%

Q2 293,440 41,5% 137,883

19,5%

Q3 592,000 83,7% 353 280

50%

Q4 709 068 100,0%

Total 709 068

100,0%Service Delivery targets for 2006/07 = 1,750 classrooms and 2,500 toilets

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CAPACITY CONSTRAINTS/LOW EXPENDITURE

Early closure in December.

2 month lag between delivery and payment – contractor submits invoice to IA , IA pays contractor and IA claims from department.

The DoW have indicated experiencing problems with National Treasury in loading up payments for their numerous service providers and have indicated that there would be an approximate 1 week delay in submitting their invoice for the month of January 2007

Internal capacity constraints – department has put measures to address

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PROJECTIONS AND IMPROVEMENTS

The Q3 projections have forecast an approximately R13m over-expenditure for the yearThe Department has revised its estimates taking into account its drop in budget, thus realising an over-expenditureThe Department has significantly improved its financial management systems with respect to Infrastructure and claims processing

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EXPENDITURE AND DELIVERY MONITORING

The Department has formed the following teams to ensure that monthly performance monitoring is carried out:

Education/Works Provincial Joint Task Team

Education/Provincial Treasury Joint Task Team

Monthly and quarterly reporting to National Education and Treasury

Internal Infrastructure Delivery Committee

Internal Finance/Infrastructure Liaison

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FET COLLEGE RECAPITALISATION

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FET EXPENDITURE SUMMARY

Key Objective/Performance Area Total

Allocation

Actual Expenditure

at December

Commitments Projections

to March

Budget

Available

% Spent of

total

allocation

Human Resource Development 5,303,000 2,803,441 1,092,142 2,418,420 2,499,559 53%

Development of Systems and procedures 4,497,000 1,984,324 668,700 2,404,221 2,512,676 44%

Upgrading,alteration,refurbishment and modernisation of classrooms,laboratories and workshops 49,292,991 20,409,580 11,653,103 27,013,727 28,883,411 41%

Upgrading of college sites 3,125,000 606,953 327,005 2,085,260 2,518,047 19%

Buying or building of new classrooms, laboratories,offices,etc. 5,945,000 1,164,493 1,847,301 4,295,250 4,780,507 20%

Purchase of Euipment 14,657,009 7,858,699 3,448,490 7,891,070 6,798,310 54%

Develop/purchase curriculum/programme materials 7,180,000 2,024,123 411,755 4,946,016 5,155,877 28%

Total 90,000,000 36,851,613 19,448,496 51,053,962 53,148,387 41%

Projected Spent of Total Grant 87,905,575 Projected Spent as % of Total Allocation 98%

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MONITORING AND REPORTING

Assessment of structural progress has been done.Verification of committed expenditure completed.Virement between colleges being assessed.

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HIV / AIDSPROGRAMME

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Q3 HIV and AIDS

Allocation for 2006/07 R 32,994m

Amount transferred at end of Q3 R 24,747m

Expenditure as of end of Q3 R 18,728m

% Spent of Total Allocation 56,8%

% Spent of Amount Transferred 75,6%

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Q3 HIV and AIDS

Spent for Q3 was 75,6% of amount transferred.Lay Counselling workshops conducted in December – Invoices processed in JanuaryProject 100% expenditure

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MONITORING HIV AND AIDS

• Monthly reporting in accordance with Schedule 3A and 3C of DORA

• Approved business plan used as management and monitoring tool

• Monthly meetings held with all Districts and affected Directorates to table financial reports(cash flow) for monitoring spending according to the conditions of the Grant

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NATIONAL SCHOOL NUTRITION PROGRAMME

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Q3 NSNP

Gazette allocation for 2006/07 R 239,372m

Additional funding from Vote 5 Baseline R 76,000m

Total Budget for the Financial Year R 315,372m

Amount transferred at end of Q3 R 179,529m

Expenditure as of end of Q3 R 233,141m

% Spent of Total Allocation 73,9 %

% Spent of Amount Transferred 129 %

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PROJECTIONS

Of the R239,3m allocated – R216,4m (90%) will be spentBalance relates to March expenditure which will not be paid R20,7m (9%) and capital items R2,2m (0,9%) that will be delivered in the next financial year.Of the R76m funded from baseline R58m (76%) will be spent.Requesting roll-over of R22,9m in respect of 2006/07 monies.The balance of R18m unspent portion of R76m – will probably be funded from baseline – continuing to put pressure on departmental finances.

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EXPENDITURE TRENDS SUMMARY

Description Total Budget

R 000

Expenditure to 3rd Quarter

R 000

% Spent of total Budget

Expenditure processed in January

R 000

Total Spent to January

R 000

% Spent of Total

Budget

Infrastructure 695 795 353 280 50,8% 116 121 469 401 67,5%

FET College Recapitilisation

90 000 36 851 41% 17 428 54 279 60,3%

HIV and AIDS 32 994 18 728 57% 2 594 21 322 64,6%

NSNP 315 372 233 141 74% 4 616 24 678 75%