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Provincial Budgets and Expenditure as at 31 December 2007 2007/08 Financial Year HOUSING

Provincial Budgets and Expenditure as at 31 December 2007 2007/08 Financial Year HOUSING. SCOF (NCOP) Hearings Presented by: Intergovernmental Relations National Treasury. February 2008. Broad Observations. The presentation covers provincial spending as at 31 December 2007

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Provincial Budgets and Expenditure as at 31 December 2007 2007/08 Financial Year HOUSING

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  1. Provincial Budgets and Expenditure as at 31 December 20072007/08 Financial YearHOUSING SCOF (NCOP) Hearings Presented by: Intergovernmental Relations National Treasury February 2008

  2. Broad Observations • The presentation covers provincial spending as at 31 December 2007 • Based on Section 40(4) PFMA reports (IYM) submitted by PTs • Published in Government Gazette on 30 January 2008 • Provincial spending is on track with 71.6% or R153.9bn spent of their budgets • Projected overspending of R1.4 billion in 6 provinces • Includes adjusted budgets • National adjustments (R2.8bn) • Provincial adjustments (R1.6bn) • Total adjustments (R4.4bn) (health – R1.6bn, education – R1.2bn) • 4 provinces projecting to overspend education budgets (NW and KZN significantly; GT to underspend) • R1.2 billion added to cover wage agreement – only R641.7m allocated by provinces • Capital – R1.2bn added, however only have capacity to spend close to main budget • Spending against budgets on conditional grants is lower than the total provincial spending average

  3. Challenges addressed through 2007 AENE • NW was impacted more significantly by re-demarcation • the sheer magnitude of the “shock” combined with use of incorrect data (number of schools, learners, educators, etc.) resulting in extreme budgetary pressures on NW education • Once-off conditional allocation of R250 million allocated to NW • Wage agreement is 1.5% higher than what prov budgeted • Costs associated with the higher than anticipated wage settlement was allocated to provinces (R1.2bn)

  4. Provincial Adjustments

  5. Key highlights • Provinces show a slight decrease in the share of Social Services total budget from 73.8% in 2006/07 to 73.2% in 2007/08 • Education remains largest item of budget at 41.9% • Health at 28.3% • Social Welfare Services only 3.0% of budget • Spending in social services sectors: • Education at R66.3bn (73.7%) • Health at R45.3bn (74.4%) • Social Welfare Services at R4.6bn (72.0%) • Spending in non-social services sectors: • Agriculture at R3.9bn (63.4%) • Housing and Local Government at R7.6bn (61.8%) • Public Works, Roads and Transport at R16.3bn (66.6%) • Sport, Arts and Culture at R1.6bn (65.7%) • Personnel spending is at R88.7bn (74.7%) • Capital expenditure is at R11.7bn (61.4%)

  6. Provincial Aggregated Expenditure (1)

  7. Provincial Aggregated Expenditure (2)

  8. Provincial Social Services (2)

  9. Conditional grants

  10. Conditional Grants (3)

  11. Conditional Grants (4)

  12. Conditional Grants (5)Spending Rates • 5 or more provinces have spent less than 60% of their grant budget for the following grants: • Land Care Programme; • Community Library Services; • HIV and AIDS (Life Skills Education); • Forensic Pathology Services; • Integrated Housing and Human Settlement Development • Although the rate of spending is encouraging and reflects an improvement over previous financial years, overall CG spending (60.4%) still lies below total provincial spending (71.6%)

  13. Housing GrantIntegrated Housing and Human Settlement Development Grant • Objective (Schedule 5 Grant): • To finance the implementation of National Housing programmes • To facilitate the establishment of habitable. stable and sustainable human settlements in which all citizens will have access to selected social and economic amenities • Progressive eradication of informal settlements on a phased basis through formalisation of informal settlements by 2014 • First Nine Months Expenditure: • Housing spent R5.1bn or 58.8% of the R8.7bn adjusted allocation • Transfers received amounted to 70.2% of national allocation • Highest spending: NC 95.7% and GP 78.6% • Lowest spending: EC 14.7% and FS 49.8% • Service Delivery Outcome: • Department / Sector to respond

  14. Conditional Grants (6)Spending Rates

  15. THANK YOUTHANK YOU THANK YOU

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