Presentation by: Rannoi Sedumo – CFO (Acting HOD) Gilberto Martins – DDG PW

13 September 2006 1

SELECT COMMITTEE ON FINANCE:Public Hearings on Conditional Grants and Capital Expenditure

First Quarter results

Presentation by:Rannoi Sedumo – CFO (Acting HOD)

Gilberto Martins – DDG PW

13 September 2006 2

CONTENTS• Strategic Context• Budget trends• Roads infrastructure

– Provincial Infrastructure Grant– Departmental Infrastructure budget– Gautrain

• Public Works infrastructure– Departmental Infrastructure budget– Client Department budgets

13 September 2006 3

VISION AND MISSIONVision

• Socio-economic growth, development, and an enhanced quality of life for all people in Gauteng

Mission• To develop an integrated, sustainable infrastructure,

which promotes a people-centered, innovative, developmental public works and an accessible, safe and affordable movement of people, goods and services

13 September 2006 4

SIX (6) STRATEGIC OBJECTIVES• Provision of accessible, affordable, reliable, safe, integrated

and environmentally sustainable public transport system• Effective management and transformation of transport and

socio-economic infrastructure related institutions, systems and processes

• Support economic growth and investments through the provision of appropriate transport systems and socio-economic infrastructure

• Integrate transport systems and socio-economic infrastructure systems in the Gauteng Growth and Development Strategy and development plans of other spheres of government

• Implement the Expanded Public Works Programmes in a manner that optimizes employment and addresses economic and social needs of the poor

• Efficient and effective management of the Department

13 September 2006 5

1st Quarter Expenditure Review

Financial year 2006/07Period : April to June 2006

13 September 2006 6

Budget Spending trendsSUMMARY OF RECEIPTS

Audited Audited AuditedAdjusted budget Appropriated MTEF MTEF

R'000 R'000 R'000 R'000 R'000 R'000 R'0002002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09

Exp. trends MTEF allocations A+B 1,398,198 1,568,337 1,751,532 1,488,007 6,225,193 5,380,786 5,223,218

CAPEX related alloactions - Capital 426,749 317,775 380,854 407,179 297,397 411,834 547,131 - Maintenance 311,412 311,105 266,337 322,424 287,332 232,070 246,816 Provincial Infrastructure Grant 64,020 94,321 132,916 147,911 163,098 162,451 172,964 - GPG Precinct 36,413 54,508 270,000 - Gautrain Rapid Rail Link 4,641,000 3,651,000 3,236,000 Total A 838,594 777,709 1,050,107 877,514 5,388,827 4,457,355 4,202,911 As % of total budget 60.0% 49.6% 60.0% 59.0% 86.6% 82.8% 80.5%

Other B 559,604 790,628 701,425 610,493 836,366 923,431 1,020,307 As % of total budget 40.0% 50.4% 40.0% 41.0% 13.4% 17.2% 19.5%

Outcome

13 September 2006 7

SUMMARY OF RECEIPTS

Appropriated MTEF MTEFR'000 R'000 R'000

2006/07 2007/08 2008/09MTEF allocations A+B 6,225,193 5,380,786 5,223,218

CAPEX related alloactions - Capital 297,397 411,834 547,131 - Maintenance 287,332 232,070 246,816 Provincial Infrastructure Grant 163,098 162,451 172,964 - GPG Precinct - Gautrain Rapid Rail Link 4,641,000 3,651,000 3,236,000 Total A 5,388,827 4,457,355 4,202,911 As % of total budget 86.6% 82.8% 80.5%

Other B 836,366 923,431 1,020,307 As % of total budget 13.4% 17.2% 19.5%

Equitable share allocated to capital 584,729 643,904 793,947 As % of total budget 9.4% 12.0% 15.2%

13 September 2006 8

SUMMARY OF RECEIPTS EXCLUDING GAUTRAIN

Appropriated MTEF MTEFR'000 R'000 R'000

2006/07 2007/08 2008/09MTEF allocations A+B 1,584,193 1,729,786 1,987,218

CAPEX related alloactions - Capital 297,397 411,834 547,131 - Maintenance 287,332 232,070 246,816 Provincial Infrastructure Grant 163,098 162,451 172,964 - GPG Precinct - - - - Gautrain Rapid Rail Link - - - Total A 747,827 806,355 966,911 As % of total budget 47.2% 46.6% 48.7%

Other B 836,366 923,431 1,020,307 As % of total budget 52.8% 53.4% 51.3%

Equitable share allocated to capital 584,729 643,904 793,947 As % of total budget 36.9% 37.2% 40.0%

13 September 2006 9

SUMMARY OF RECEIPTS

ROADS PUBLIC WORKS TOTALR'000 R'000 R'000

2006/07 2006/07 2006/07CAPEX related allocations - Capital 231,557 65,840 297,397 - Maintenance 202,857 84,475 287,332 Provincial Infrastructure Grant 163,098 163,098 Total 597,512 150,315 747,827 As % of total budget 79.9% 20.1% 100.0%

13 September 2006 10

Conditional Grant• The department is a recipient of the

Provincial Infrastructure Grant from National Treasury

• The grant is used for maintenance and rehabilitation of roads

• A business plan was submitted as required by Division of Revenue Act


Provincial Infrastructure Grant

ActualYear Quarter 1 Quarter 2 Quarter 3 Quarter 4 TOTAL BUDGET

R'000 R'000 R'000 R'0002006/07 34,834 46,749 51,487 31,259 164,329 163,098 % of Total 21% 28% 31% 19% 100%

Estimate


34,83446,74951,487

31,259164,329163,098

Quarter 1Quarter 2Quarter 3Quarter 4

TOTALBUDGET

Qua

rter

Expenditure

2006/07



Years Quarter 1 Quarter 2 Quarter 3 Quarter 4 TOTALR'000 R'000 R'000 R'000

2005/06 19,227 30,963 43,569 52,734 146,493 2006/07 34,834 46,749 51,487 31,259 164,329

-

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

Quarter1

Quarter2

Quarter3

Quarter4

TOTAL

2005/062006/07


Budget Actual Budget Actual Budget EstimatedP139-1 Rehab 17,361 10,413 968 RetentionK69 – Rehab 13,196 1,127 0 FinishedP119-1 – Reseal 598 0 39,843 ConstructionP91-1 - Reseal Phase 1 2,229 3,816 27,291 ConstructionP156-2/P202-1 – Reseal 33,798 12,454 826 Retention83, 1321 – Reseal 26,800 436 228 Finished795 – Rehab 1,232 0 0 FinishedP66-1 Phase 2 – Reseal 27,460 28,032 1,206 RetentionP66-1 Phase 3 – Rehab 1,572 0 1,188 PlanningP167-1 – Reseal 844 15,286 23,845 ConstructionP175-1, 1113 – Reseal 2,026 0 0 Planning1132 – Reseal 7,735 916 0 FinishedP174-1 – Reseal 12,633 0 623 RetentionP58-1 – Reseal 663 19,997 19,288 ConstructionD51 Phase 1 – Reseal 2,257 16,703 9,653 ConstructionP159-1, 2516 – Reseal 453 104 0 Planning434, 1931 & 1932 67 12,042 1,568 Retention1520, 405 – Reseal 0 19,658 1,426 RetentionK103 – Reseal 0 4,628 631 RetentionP71-1 Phase 2 – Rehab 0 164 119 PlanningP123-1 – Rehab 0 283 0 PlanningP158-1 – Reseal 0 434 0 PlanningDiluted Emulsion 06/07 0 0 7,000 ConstructionP38-1 - Reseal 0 0 10,000 ConstructionP95-2 – Rehab 0 0 20,585 ConstructionTotal 132,918 150,925 147,911 146,493 163.098 166,288

132,

918

147,

911

163,

098

Expenditure per project on the Conditional Grants for 2004/05 to 2006/07

Project Expenditure Status2004/05 2005/06 2006/07


Capital Expenditure

ActualYear Quarter 1 Quarter 2 Quarter 3 Quarter 4 TOTAL BUDGET

R'000 R'000 R'000 R'0002006/07 69,658 80,692 139,090 143,238 432,678 432,554 % of Total 16% 19% 32% 33% 100%

Estimate

Capital Expenditure

0 100000 200000 300000 400000 500000

Quarter 1Quarter 2Quarter 3Quarter 4

TOTALBUDGET

Qua

rter

Amount

2006/07


Capital Expenditure

Years Quarter 1 Quarter 2 Quarter 3 Quarter 4 TOTAL BUDGETR'000 R'000 R'000 R'000

2005/06 61,010 101,699 56,384 69,137 288,230 339,516 2006/07 69,658 80,692 139,090 143,238 432,678 432,554

-100,000200,000300,000400,000500,000

Amount

Quarter

Capital Expenditure

2005/062006/07


Key projects in Roads Infrastructure

• Construction of the dual carriageway and two intersections for Cosmo City

• Construction of K60 in Sunninghill• Construction of a dual carriageway from Dalpark

to Heidelberg - K109 Old Heidelberg road• Rehabilitation of the Cullinan road in the

Dinokeng area


GAUTRAIN

– Delay in the sign off of the financial implications of the project might lead to under expenditure.

– Indications are that the financial closure will be reached towards the end of September 2006.

– This milestone will accelerate expenditure.


GAUTRAIN EXPENDITURE

BUDGETR’000

ACTUALR’000

VARIANCER’000

% SPENT

4 641 000 254 405 4 386 595 5,5


Gauteng Department of Public Transport, Roads, and Works-

“The Preferred Service Provider”


DPTRW – Vote 9 : Program 2 – Capital Works• To construct new facilities• Upgrade , rehabilitation, maintain existing

facilities• Implement client departments needs• Render professional and technical service• Ensure optimum usage and benefits of

provincial property portfolio


Expenditure Report – Prg 2 :Public WorksCapital Works

ProgrammeNumber

Budget April 2006Exp

May 2006Exp

June 2006Exp

Total 1st Quarter 2006

Exp

% 1st Quarter

Exp

Program 2 R 150 315 000 R 1 680 465 R 8 860 049 R 14 620 567 R 24 981 080 16%

Notes:

Expenditure in the April is low due to commencing of work on site. New project started in this financial year have a low capital expenditure in month 1.

To ensure that expenditure is maintained at minimum average of app R12 mil per month in accordance with budget allocation, April month under spending is being factored in to proceeding months.

Monthly project review meeting being held to monitor expenditure.


Ist Quater Expenditure 06/07 PW Capital Works

150

1.6 8.614.8 25 (16%)

0

50

100

150

1st Qtr

Budg

et R

000

000

Budget Exp April Exp May Exp June Total 1st Qrt


DPTRW – Vote 9 : Program 2 – Maintenance

• Upgrade , rehabilitation, maintain existing facilities

• Implement client departments needs• Render professional and technical service• Ensure optimum usage and benefits of

provincial property portfolio


Expenditure Report – Prg 2 :Public Works Maintenance

ProgrammeNumber


May 2006Exp

June 2006Exp

Total 1st Quarter 2006

Exp

% 1st Quar Exp

Program 2 R 20 000 000 R 2 205 581 R 2 528 629 R 1 700 582 R 6 434 792 32%

Note:

The Pretoria region has the largest number of Public Works facilities that it is required to maintain, hence the budget allocation is large in comparison to the other regions ie Pretoria Region = R 10 mil : Springs Region R 1.0 mil.

Expenditure is in line with the projection at present.

Monthly project review meeting are held to review progress and outputs.


Public Works - Maintenance Per Region

0

500000

1000000

1500000

2000000

2500000

3000000

Westhoven Pretoria Soweto Tulisa Park Springs

Expe

nditu

re

April May June TOTAL


Expenditure Report – Social DevelopmentProgrammeNumber


May 2006Exp

June 2006Exp

Total 1st Quarter 2006 Exp

% 1st Quarter Exp

Capital: R 12 542 167 R 3 011 879 R 2 070 841 R 331 931 R 5 414 651 43 %

Maintenance : R 14 700 000 R 857 507 R 1 343 551 R 783 479 R 2 984 537 21%

0

2000000

4000000

6000000

8000000

10000000

12000000

14000000

Budget April May June Total 1st Qrt

Social Development - Capital


Social Development - Maintenance 1st Quarter

0100000200000300000400000500000600000700000800000900000

1000000


Expe

nditu

re



Expenditure Report – DACEProgrammeNumber


May 2006Exp

June 2006Exp


% 1st Quarter Exp

Capital: R 6 749 000 R 1 741 091 R 1 121 242 R 1 137 361 R 3 999 694 60%

Maintenance : R 7 951 000 R 81 319 R 940 R 22 616 R 104 875 1%

0

1000000

2000000

3000000

4000000

5000000

6000000

7000000


DACE - Capital


DACE Maintenance

0100002000030000400005000060000700008000090000

100000


Expe

nditu

re


No allocation


Expenditure Report – HealthProgrammeNumber


May 2006Exp

June 2006Exp


% 1st Quarter Exp

Capital: R 556 161 792 R 97 721 612 R 71 328 956 R 57 100 890 R 226 161 458 41%

Maintenance : R 288 878 000 R 20 465 332 R 28 978 934 R 24 257 255 R 73 701 521 26%

0

100000000

200000000

300000000

400000000

500000000

600000000


Health- Capital


Health Department - Maintenance

0

5000000

10000000

15000000

20000000

25000000

30000000

35000000


Expe

nditu

re



Expenditure Report – SRACProgrammeNumber


May 2006Exp

June 2006Exp


% 1st Quarter Exp

Capital: R 46 000 000 R 4 895 012 R 2 568 765 R 4 657 564 R 12 121 340 27%

0

5000000

10000000

15000000

20000000

25000000

30000000

35000000

40000000

45000000

50000000


SRAC - Capital


DPTRW – Vote 9 : Program 5 – EPWP• Enable economic upliftment and

empowerment• Reduce infrastructure backlogs• Alleviate unemployment by creating jobs• Facilitate skills development through

training• Target woman, youth, disabilities job

creation


Expenditure Report – Prg 5 - EPWP

ProgrammeNumber

BudgetR 000

April 2006Exp

May 2006Exp

June 2006Exp


Availablebudget

% 1st Quarter Exp

Program 5 R 224 428 16 390 654 38 252 956 46 577 148 101 220 758 123 207 242 45%


Ist Quater Expenditure 06/07 EPWP

224

1638 46

101 ( 45 %)

0

50

100

150

200

250

1st Qtr

Budg

et R

000

000

Budget Exp April Exp May Exp June Total 1st Qrt


Wayforward• Introduction of multi year financial budgeting and

implementation for projects.• Life cycle budgeting to be developed at project

identification phase.• Contractual implementation in line with CIDB

requirements.• Construction Contact Centres established to

assist with contractor development and project assistance.


Monitoring capacity and planning

• Monthly Expenditure Report meetings are held between programme managers and the Finance branch.

• Senior quarterly management meetings are used to discuss performance of the various programmes.

• The Executive Management committee also receives monthly expenditure report from the CFO.

• The HOD and DDG PW holds one-on-one meetings with individual managers from time to time to ensure accountability for service delivery.


Monitoring capacity and planning• At unit level performance is monitored against

operational plans.• Monthly and quarterly infrastructure reports are

send to Treasury.• Project Management Resource Groups assist in

ensuring performance happens at site level.• Client departments needs/plans developed and

implemented.


Service Level Agreements• SRAC has been signed in August 06• Social Development , final draft with client

for legal review and comments, will be signed 2 weeks post comments received by Public Works.


Service Level Agreements• Health Department was signed July 06.• DACE Final draft to DACE , if approved to

signed 19th Sept• SLA’s with Blue IQ are in place for the

Cradle of Humankind and Dinokeng projects.


Thank You

“In order to achieve real action you must yourself be a living part of Africa and of her thought; you must be an element of that popular energy which is entirely called forth for the freeing, the progress and the happiness of Africa.”Frank Talk , Steve Biko , I write what I like

Documents

Presentation by: Rannoi Sedumo – CFO (Acting HOD) Gilberto Martins – DDG PW