1

Preliminary Provincial Budget Outcome of Conditional Grants

as at 31 March 2007

Select Committee on FinancePresentation by

Free State Provincial Treasury

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DISCUSSIONS

• To brief the Select Committee on Finance on the preliminary actual and projected Conditional Grant outcomes as at 31 March 2007

– Aggregate preliminary expenditure– Trends in allocations and preliminary

expenditure of conditional grants

3

2006/2007 Adjusted Budget

R'm % increase

Original budget 11 626,2Adjustment Estimates 256,5 2,2%

Equitable Share 133,1 1,1%Roll-overs 70,8 0,6%Additional - Provincial funds 60,6 0,5%Self-financing expenses (LGWSETA) 1,8 0,0%

Conditional Grants 123,4 1,1%Roll-overs 71,1 0,6%Additional 48,2 0,4%Adjustments - National 4,1 0,0%

Total Provincial budget 11 882,7 102,2%

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2006/07 PRELIMINARY BUDGET OUTCOME• Preliminary actual expenditure = R12, 306

billion (103.6%) with an average monthly expenditure of R1,025 billion (8.6%)

• Expenditure during February accounts for 8.7% and March expenditure for 14.2%

• Net preliminary over expenditure amounts to R423 million (3.6%)

– Under expenditure by 8 departments = R 60,0 million (0.5%)

– Over expenditure by 4 departments = R483,0 million (4.1%)

• Departments overspending – Works, Roads, Transport = R363,6 million (34.1%)– Health = R 105,6 million (3.1%)– Education = R 11,9 million (0.2%)– Premier = R 1,8 million (1.9%)

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PRELIM DEPARTMENTAL PERFORMANCE – March 07

DEPARTMENT

BudgetAdjust-

ments

Adjusted

budgetExp

As % of

budget

(Over)/under

expenditure

As % of

budget

R'm R'm R'm R'm % R'm %

(1) (2) (3) (4) (5) (6) (7) (8)

Premier 91,9 3,0 94,9 96,7 101,9% -1,8 -1,9%Legislature 73,9 1,0 74,9 74,8 99,8% 0,1 0,2%Tourism 229,8 0,0 229,8 226,4 98,5% 3,4 1,5%Treasury 119,7 0,0 119,7 103,2 86,2% 16,5 13,8%Health 3 249,6 119,8 3 369,4 3 475,0 103,1% -105,6 -3,1%Education 5 272,2 61,0 5 333,3 5 345,2 100,2% -11,9 -0,2%Social Dev elopment 417,9 27,9 445,7 442,4 99,3% 3,3 0,7%Housing 718,1 27,8 745,9 714,6 95,8% 31,3 4,2%Works 1 066,3 0,0 1 066,3 1 430,0 134,1% -363,6 -34,1%Safety 31,8 0,0 31,8 31,6 99,5% 0,2 0,5%Agriculture 223,6 8,6 232,1 227,2 97,9% 5,0 2,1%Sport 131,5 7,4 138,9 138,6 99,8% 0,3 0,2%TOTAL 11 626,2 256,5 11 882,7 12 305,7 103,6% -423,0 -3,6%

2006/07

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Preliminary Conditional Grant expenditure

• Aggregate Conditional Grant expenditure per department

• Conditional Grant expenditure per grant type

• Detail on Conditional Grant expenditure per department

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PRELIMINARY EXPENDITURE ON CONDITIONAL GRANTS AS AT 31 MARCH 2007• Expenditure of Conditional Grants amounts to R1,779 billion

which equals: – 98.4% of the adjusted Conditional Grant budget of R1,807 billion;– 14.5% of total provincial expenditure of R12,306 billion.

• Under expenditure amounts to R28,7 million. Deviations from budgets: – Agriculture Disaster Man - R 3,417 million (51.2%)– LandCare - R 0,147 million (3.8%)– HIV and Aids (Health) - R 3,847 million (2.7%)– Forensic Pathology - R11,589 million (24.7%)– Integrated Housing - R 0,217 million (0%)– Mass Sport & Recreation - R 0,145 million (1.5%)– Integrated Soc Dev Services - R 0,025 million (0.1%)– PIG: Health - R 8,559 million (16.7%)

Education - R 0,758 million (1.3%)

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Preliminary Expenditure on C-grants as at 31 March 2007

Department Original budget

National Adjustm

Prov Adjustm

Adjusted budget

Expenditure

R’m R’m R’m R’m R’m % R’m %(1) (2) (3) (4) (5) (6) (7) (8) (9)

Agriculture 28,4 0,8 6,7 35,9 32,3 90,1 3,6 9,9 Local Gov & Housing 522,6 0,0 6,0 528,6 528,4 100,0 0,2 0,0 Education 162,5 0,0 8,3 170,8 170,0 100,0 0,0 0,0 Health 780,0 54,7 16,0 850,7 826,7 98,1 15,4 1,9 Sport 9,8 0,0 0,2 10,0 9,8 98,5 0,1 1,5 PIG 183,4 0,0 0,0 183,4 183,4 96,8 9,3 3,2 Social Development 0,0 0,0 27,9 27,9 27,9 99,9 0,0 0,1 TOTAL 1 686,7 55,5 65,1 1 807,2 1 778,5 98,4 28,7 1,6

Under exp

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2006/07 Conditional-grant budgets by Grant TypeDepartment/Conditional Grant

Original budget

National Adjustm

AdjustmAdjusted Budget

Amount received

Agriculture 28,4 0,8 6,7 35,9 29,2Agric Disaster Management 0,0 0,0 6,7 6,7 0,0CASP 25,3 0,0 0,0 25,3 25,3LandCare 3,1 0,8 0,0 3,9 3,9

Local Gov & Housing 522,6 0,0 6,0 528,6 522,6Integrated Housing Subsidy 522,6 0,0 6,0 528,6 522,6

Education 103,2 0,0 8,3 111,5 103,2FET College Sector Recapitalisation 30,0 0,0 0,0 30,0 30,0HIV and Aids (Life Skills Education) 8,4 0,0 0,4 8,9 8,4Primary School Nutrition Programme 64,8 0,0 7,9 72,7 64,8

Health 780,0 3,3 16,0 799,3 783,3Health Professions Training & Development 92,5 0,0 0,0 92,5 92,5Comprehensive HIV and Aids 142,3 0,0 0,0 142,3 142,3Hospital Revitalisation 45,7 0,0 13,9 59,6 45,7National Tertiary Services 458,0 0,0 0,0 458,0 458,0Forensic Pathology Services 41,5 3,3 2,0 46,9 44,8

Sport 9,8 0,0 0,2 10,0 9,8Mass Sport & Recreation Participation Programme 9,8 0,0 0,2 10,0 9,8

Provincial Infrastructure 242,7 51,4 0,0 294,0 0,0Public Works, Roads & Transport 183,4 0,0 0,0 183,4 0,0Education 59,3 0,0 0,0 59,3 0,0Health 0,0 51,4 0,0 51,4 0,0

Social Development 0,0 0,0 27,9 27,9 0,0Integrated Social Development Services 0,0 0,0 27,9 27,9 0,0

Total IYM Conditional Grants 1 686,7 55,5 65,1 1 807,2 1 742,2

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Conditional-grants by Grant Type as at 31 March 2007Conditional Grant

Adjusted Budget

Amount received

ExpenditurePrelim

Under ExpUnder exp as %

of budget

R'm R'm R'm% of

budget% of funds

receivedR'm %

Agriculture 35,9 29,2 32,3 90,1 110,7 3,6 9,9Agric Disaster Management 6,7 0,0 3,3 48,8 3,4 51,2CASP 25,3 25,3 25,3 100,0 100,0 0,0 0,0LandCare 3,9 3,9 3,8 96,2 96,5 0,1 3,8

Local Gov & Housing 528,6 522,6 528,4 100,0 101,1 0,2 0,0Integrated Housing Subsidy 528,6 522,6 528,4 100,0 101,1 0,2 0,0

Education 111,5 103,2 111,5 100,0 108,1 0,0 0,0FET College Sector Recapitalisation 30,0 30,0 30,0 100,0 100,0 0,0 0,0HIV and Aids (Life Skills Education) 8,9 8,4 8,9 100,0 105,2 0,0 0,0Primary School Nutrition Programme 72,7 64,8 72,7 100,0 112,2 0,0 0,0

Health 799,3 783,3 783,9 98,1 100,1 15,4 1,9Health Professions Training & Development 92,5 92,5 92,5 100,0 100,0 0,0 0,0Comprehensive HIV and Aids 142,3 142,3 138,4 97,3 97,3 3,8 2,7Hospital Revitalisation 59,6 45,7 59,6 100,0 130,5 0,0 0,0National Tertiary Services 458,0 458,0 458,0 100,0 100,0 0,0 0,0Forensic Pathology Services 46,9 44,8 35,3 75,3 78,7 11,6 24,7

Sport 10,0 9,8 9,8 98,5 100,4 0,1 1,5Mass Sport & Recreation Participation Programme 10,0 9,8 9,8 98,5 100,4 0,1 1,5#DIV/0!

Provincial Infrastructure 294,0 294,0 284,7 96,8 96,8 9,3 3,2Public Works, Roads & Transport 183,4 0,0 183,4 100,0 0,0 0,0Education 59,3 0,0 58,5 98,7 0,8 1,3Health 51,4 0,0 42,8 83,3 8,6 16,7

Social Development 27,9 0,0 27,9 99,9 0,0 0,1Integrated Social Development Services 27,9 0,0 27,9 0,0 0,0 0,0

Total IYM Conditional Grants 1 807,2 1 742,2 1 778,5 98,4 102,1 28,7 1,6

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Detail on Conditional Grants per department: Agriculture

• Agriculture spent 90.1% or R32,3 million of their adjusted C-grant allocation of R35,9 million.

• Preliminary Budget Outcome per grant– CASP:

• Adj Budget = R25,3 million• Expenditure = R25,3 million (100%)

– LandCare Grant:• Adj Budget = R3,9 million• Expenditure = R3,8 million (96.2%)• Under expenditure = R0,1 million (3.8%)

– Disaster Management:• Adj Budget = R6,7 million• Expenditure = R3,3 million (48.8%)• Under expenditure = R3,4 million (51.2%)

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Detail on Conditional Grants per department: Local Government and Housing

• Local Gov and Housing spent the total adjusted Housing fund allocation of R528,6 million apart from an insignificant R0.217 million– 16.9% was spent in February– 24.0% spent in March

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Detail on Conditional Grants per department: Education

• Preliminary expenditure by Education amounts to R170,0 million or 99.6% of their adjusted Conditional Grant allocation of R170,8 million and they underspent on PIG.

• Preliminary Budget Outcome per grant– Further Education and Training College Sector

Recapitalization Grant:• Allocation = R30 million• Expenditure = R30 million (100%)

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Detail on Conditional Grants per department: Education (continue)

• Preliminary Budget Outcome per grant (continues)– HIV and Aids Grant:

• Adjusted allocation = R8,9 million• Expenditure = R8,9 million (100%)

– National School Nutrition Programme Grant:• Adjusted allocation = R72,7 million• Expenditure = R72,7 million (100 %)

– Provincial Infrastructure Grant:• Allocation = R59,3 million• Expenditure = R58,5 million (98.7%)• Under expenditure of R0,8 million (1.3%)

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Detail on Conditional Grants: Health • Health spent 97.2% or R826,7 million of their

adjusted Conditional Grant allocation of R850,7 million and underspent by about R24 million at the end of the financial year on 3 grants.

• Preliminary Budget Outcome per grant– HIV and Aids Grant:

• Allocation = R142,3 million• Expenditure = R138,4 million (97.3%)• Under expenditure = R3,9 million (2.7%)

– Forensic Pathology Services Grant• Adjusted allocation = R46,9 million• Expenditure = R35,3 million (75.3%)• Under expenditure = R11,6 million (24.7%)

– Health Professions Training and Development Grant:• Allocation = R92,5 million• Expenditure = R92,5 million (100%)

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Detail on Conditional Grants: Health (continue)

• Preliminary Budget Outcome per grant (continue)– Hospital Revitalisation Grant:

• Adjusted allocation = R59,6 million• Expenditure = R59,6 million (100%)

– National Tertiary Services Grant:• Allocation = R458,0 million• Expenditure = R458,0 million (100%)

– Provincial Infrastructure Grant:• Allocation = R51,4 million• Expenditure = R42,8 million (83.3%) • Under expenditure = R8,6 million (16.7%)

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Detail on Conditional Grants: Sport, Arts and Culture

• Sport, Arts and Culture spent 98.5% or R9,8 million of their 2006/07 adjusted allocation of R10,0 million for the Mass Sport and Recreation Participation Programme grant.

• Under expenditure amounts to R0,1 million (1.5%).

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Detail on Conditional Grants per department: Public Works, Roads and Transport

• The total allocation in respect of the Provincial Infrastructure Grant to Public Works, Roads and Transport amounting to R183,4 million was already fully spent during December 2006.

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National Treasury (Provincial Infrastructure grant)• Preliminary expenditure of the Provincial Infrastructure grant

(included in discussions per department) amounts to R284,7 million or 96.8% of the allocation of R294,0 million from National Treasury.

• Under expenditure of R9,3 million or 3.2% was recorded by Education and Health

• Three departments benefit from this grant:– Public Works, Roads and Transport

• Allocation = R183,4 million (62.4%)• Preliminary Expenditure = R183,4 million (100.0%)

– Education• Allocation = R59,3 million (20.1%)• Preliminary Expenditure = R58,5 million (98.7%)• Under expenditure = R0,8 million (1.3%)

– Health• Allocation = R51,4 million (17.5%) • Preliminary Expenditure = R42,8 million (16.7%)• Under expenditure = R8,6 million (16.7%)

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INFRASTRUCTURE EXPENDITURE – March 07Dept Source Budget Preliminary outcome Exp as % of budget

R'000 R'000 % R'000 %TEEA PIG 10 200

ES 15 792 IRM 25 992 25 137 96,71% 855 3,29%Health PIG 133 738

ES 3 118 Revital 59 598

IRM 196 454 188 561 95,98% 7 893 4,02%Roads PIG 397 219

ES 118 136 IRM 515 355 793 768 154,02% (278 413) -54,02%Works ES 255 707 IRM 255 707 284 591 111,30% (28 884) -11,30%Educ PIG 142 143

Infra Enhancem 46 106 Other 1 500

IRM 189 749 215 331 113,48% (25 582) -13,48%Agric CASP 25 306

L / C 3 115 Other 794

IRM 29 215 29 088 99,57% 127 0,43%SAC PIG 23 700

ES 1 270 IRM 24 970 24 896 99,71% 74 0,30%Soc Dev ES 16 193 IRM 16 193 14 604 88,83% 1 589 9,81%TOTAL 1 253 635 1 575 976 125,70% (322 341) -25,71%

Expected (over)/under exp

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PRELIMINARY CAPITAL EXPENDITURE – 2006/07DEPARTMENTS Capital Transfers Capital Assets Total Capital (Over)/Under Exp

Adj Bud Exp Adj Bud Exp Adj Bud ExpR’m R’m R’m R’m R’m R’m R’m

(1) (2) (3) (4) (5) (6) (7) (8) (9) (10)Education (IYM) 0,0 31,7 185,4 201,2 185,4 232,9 125,6% -47,4 -0,3Health 0,0 0,0 236,5 246,3 236,5 246,3 104,1% -9,8 0,0Social Development 0,0 0,0 24,2 23,9 24,2 23,9 98,7% 0,3 0,0Tourism Env & Econ affairs 0,0 0,0 37,2 29,7 37,2 29,7 79,8% 7,5 0,2Works Roads & Transport 0,0 0,0 310,8 534,8 310,8 534,8 172,1% -224,1 -0,7Agriculture 1,6 1,6 26,7 29,1 28,3 30,7 108,4% -2,4 -0,1Sport Arts & Culture 0,0 0,0 25,8 25,7 25,8 25,7 99,8% 0,0 0,0SUB-TOTAL 1,6 33,2 846,6 1 090,7 848,2 1 123,9 132,5% -275,8 -0,3Local Gov & Housing 560,8 546,6 5,3 1,9 566,2 548,5 96,9% 17,7 0,0TOTAL 562,4 579,9 851,9 1 092,6 1 414,3 1 672,5 118,3% -258,1 -0,2

Exp as % of budget

As % of budget

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