2016/17 Quarter 3 Spending Outcome

Transcription

1 2016/17 Quarter 3 Spending Outcome STANDING COMMITTEE ON APPROPRIATIONS Presenter: Dondo Mogajane DDG: Public Finance, National Treasury 01 March 2017

2 Contents Summary of 2016/17 voted expenditure Spending outcome by vote Spending outcome by economic classification Spending outcome by functional groups 2

3 Summary of 2016/17 Voted Expenditure Available Budget Current payments 2% 1% 29% 31% 68% 69% Current payments Transfers and subsidies Payment for capital assets Payment for Financial Assets Compensation of employees Goods and services 3

4 Spending Outcome by Vote 4

5 Spending Outcome by Vote Departments spent R535.3 billion or 74.0 per cent of available budget R722.9 billion so far Departments with significantly higher than projected expenditure (based on variance of R400 million and/or higher percentage of projected expenditure) include: - Home Affairs (R714.9 million or 12.9 per cent) up from R542.1 million in Q2 - Defence and Military Veterans (R428.2 million or 1.3 per cent) - down from R753.8 million in Q2) Departments that significantly spent less than projected based on variance of R400 million and/or percentage of projected expenditure include: - Higher Education (R3.1 billion or 6.8 per cent) - COGTA (R3 billion or 5.6 per cent) - Basic Education (R2 billion or 10.6 per cent) - Rural Development and Land Reform (R1.4 billion or 18.4 per cent) - Trade and Industry (R1.3 billion or 15.6 per cent) - Social Development (R1.1 billion or 1 per cent) - Human Settlements (R875.3 million or 3.9 per cent) - Police (R492.1 million or 0.8 per cent) 5

6 R million Spending Outcome by Economic classification Projection Actual Compensation of employees Goods and services Interest on rent and land Transfers and subsidies Payments for capital assets Payments for financial assets 6 Departments spend R15.6 billion or 2.8 per cent less than projected expenditure Spend R2.4 billion or 22.2 per cent less than projected expenditure on payments for capital assets (down from 30.2 per cent)

7 Spending outcome by functional group Spending outcome of selected departments per functional group based on amounts and/or percentage of lower and higher spending compared to projected expenditure. The following slides contain details of spending outcomes by functional groups: Health and Social Development Education and related departments Economic Services Urban Development and Infrastructure Justice, Crime Prevention and Security Administrative Services 7

8 R million Health and Social Development Projection Actual Health Social Development Health spent R28.9 billion or 74.8% of available budget; spending is fairly on track. Lower than projected spending mainly under Hospitals, Tertiary Health Services and Human Resource Development programme and administration programme. Social Development spent R1.1 billion or 1% lower than projected, slow spending mainly within the Social Assistance programme on the child support grant as a result of a number of children falling off the system. In terms of economic classification, Social Development spent R35.7 million more than projected under goods and services due to payment of accrual commitments from the 2015/16 financial year for travelling costs, audit fees, venues and facilities, operating leases, fleet services, legal fees and computer services. Department likely to over spend goods and services. 8

9 R million Education and related departments Projection Actual Basic Edu Higher Edu and Training Labour Arts & Culture 9

10 Education and related departments Basic Education Spent R2 billion or 10.6 per cent lower than projection, variance is mainly under programmes 2 and 4: - Programme 2: Curriculum Policy, Support and Monitoring - under goods and services due to delays in receiving invoices for the printing and distribution of workbooks for grades R-9 and learner and teacher support materials for the national senior certificate learner retention programme (2nd Chance Matric programme) - Programme 4: Planning, Information and Assessment low spending due to implementation delays in the School Infrastructure Backlogs grant (slow spending also due to poor performance by some implementing agents, difficulty in replacing underperformers, and delays in finalising the merging and rationalisation of schools in the Eastern Cape Province. Underspending of this grant has been a problem since its inception in 2011/12 10

11 Education and related departments Higher Education and Training Spent R3.1 billion or 6.8 per cent lower than projected expenditure mainly delays in the payment of the university infrastructure earmarked grant under Programme 3: University Education Labour Spent R123.6 million or 5.3 per cent lower than projected expenditure mainly due to delays in filling of positions and delayed payment of invoices for goods and services Arts and Culture Spent R176.2 million or 5.5 per cent lower than projected, mainly due to delayed invoices from DPW for the repairs and maintenance of the National Archives- Old Library building and upgrading of the air-conditioning system at the National Archives under Capital Works projects. 11

12 R million Economic Services Projection Actual Trade & Industry DRDLR DSBD DEA 12

13 Economic Services Trade and Industry Spent R1.3 billion or 15.6 per cent less than projected expenditure mainly under Programme 6:Incentive Development and Administration, due to outstanding compliance documents, unprocessed claims and outstanding agreements of Enterprise Investment, Automotive Production and Development programmes Rural Development and Land Reform Spent R1.4 billion or 18.4 per cent lower than projected expenditure mainly the slow pace of the department`s expenditure under Restitution Programme as a result of the Constitutional Court ruling on the invalidity of the Restitution Amendment Act in July Significant slow spending is also recorded under the National Geomatics Management Services programme as a result of late transfers to departmental agencies and accounts particularly to the Registration of Deeds Trading Account budget. Environmental Affairs Spent R286.3 million or 5.9 per cent lower than projected expenditure mainly due to slow spending on EPWP programmes. Delays are due to protracted contract negotiations with implementing agents. 13

14 R million Urban Development and Infrastructure Projection Actual COGTA Human Settlements DWS 14

15 Urban Development and Infrastructure COGTA Spent R3 billion or 5.6 per cent lower than projected expenditure mainly due to: - the withholding of the local government equitable share and the municipal infrastructure grant of due to unapproved rollovers - lower than expected spending on immediate relief disaster grants DWS Spent R51.1 million or 0.4 per cent more than projected expenditure due higher expenditure in the Accelerated Community Infrastructure Programme (ACIP) and the Regional Bulk Infrastructure Grant ( RBIG), which is also reflected under higher than projected payments for capital assets. Human Settlements Spent R875.3 million or 3.9 per cent lower than projected expenditure mainly under that Human Development Finance programme due to non-payment of public entity transfers for operational and capital programmes 15

16 R million Justice, Crime Prevention and Security Projections Actual Police DMV J&CD 16

17 Justice, Crime Prevention and Security Police Spent R492.1 million or 0.8 per cent lower than projected spending mainly under - Visible Policing programme due to slow spending on transport equipment due to delays in the finalisation of transversal contract. - Detective Services programme due to slow spending in compensation of employees and this is due to vacancies. The Administration programme spent R662.4 million higher than projection mainly due to higher than anticipated payments for computer services particularly on the item: SITA system development: operational support. Defence and Military Veterans Spent R428.2 million or 1.3 per cent higher than projected expenditure under various programmes: 17 - Administration: higher spending due to the payment of accruals for accommodation charges as a result of delays in the receipt of invoices from the Department of Public Works as well as the higher than anticipated payment made to the Department of International Relations and Cooperation (DIRCO) regarding the defence attaché offices - Landward Defence: Higher spending due to the once-off payment of about R127 million for home owners allowance that should have been paid in 2015/16 financial year - Military Health Support: higher spending due to the high costs of outsourced medical services and medical waste removal

18 Justice, Crime Prevention and Security Justice and Constitutional development Spent R204.9 million or 3.4 per cent lower than projected expenditure mainly under Administration due to delays in settling employee s performance bonuses, delays in submission of invoices for office accommodation by the Department of Public Works, as well as delays in procurement of office furniture and equipment for head office. 18

19 R million Administrative Services Projections Actual Home Affairs DIRCO National Treasury 19

20 Administrative Services Home Affairs Spent R714.9 million or 12.9 per cent higher than projected expenditure, mainly due to the expenditure related to issuing of enabling documents which is funded through self-financing allocated during the Adjusted Estimates of National Expenditure. DIRCO Spent R226.8 million or 4.7 per cent lower than projected expenditure mainly under the Administration and International Cooperation programmes: - Administration: slow spending in outstanding invoices for ICT projects as well as transfer budget in relation to storage. - International Cooperation: slow spending due to cost containment measures that the department is implementing in missions abroad in relations to rentals where the department managed to negotiate zero increase in some leases abroad National Treasury Spent R312.7 million or 1.5 per cent higher than projected expenditure, mainly due to additional expenditure incurred on the Integrated Financial Management System (IFMS) Solution for the purchasing of software licences. 20

21 Thank you