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Portfolio Committee on Public Works 29 th January 2014 Cape Town

South Africa Works because of Public Works. Quarter 2 Report 2013/14 (Period July, August & September 2013). Portfolio Committee on Public Works 29 th January 2014 Cape Town. I Public Works I CGO I Pretoria. Layout. Part A Performance Information Highlight/Achievement Challenges

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Portfolio Committee on Public Works 29 th January 2014 Cape Town

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  1. South Africa Works because of Public Works Quarter 2 Report 2013/14 (Period July, August & September 2013) Portfolio Committee on Public Works 29th January 2014 Cape Town I Public Works I CGO I Pretoria

  2. Layout • Part A • Performance Information • Highlight/Achievement • Challenges • Some Corrective Measures • Part B • Financial Information • DPW • PMTE

  3. Purpose • Purpose of the Presentation by the Department of Public Works • To reflect on the 2nd Quarter Performance and Financial information of the Department of Public Works in the financial year 2013/14 in order for the Portfolio Committee to advise on improving performance • Objective of the Portfolio Committee on Public Works • To have an understanding and measure the 2nd Quarter Performance and Financial performance of the Department for the financial year 2013/14.

  4. Methodology of Assessing the Quarterly Reports • 3 Phase Approach as per the Approved Department’s Policy Framework For Monitoring, Reporting and Evaluation of Performance Information 2013 and M&E Toolkit, PFMA and Framework for Strategic Plans and Annual Performance Plans • Phase 1 (Data Collection & Compliance) – 14th October 2013 – Submissions by all units • Phase 2 (Data Cleansing and Analysis) – 15th – 25thOctober 2013 • Phase 3 (Accountability Process) – 28th – 31st October 2013 • Key Focus • Adherence/Compliance to the Policy framework for monitoring, reporting and evaluation of performance information in the Department of Public Works • Effective use of the M&E toolkits to measure and judge progress (Actual versus Target) in order to learn, improve reporting, innovate and adapt to change • Encourage the use of quality performance information for decision making and resource management • Project the various related components of Performance Information (M&E System) - for example, the inputs, processes, activities, outputs, outcomes, and impacts that constitute projects, programmes, and services • To test the appropriateness of the indicators • To provide an assessment on the overall performance of the Department

  5. Programme 1 Administration (Pages 6 – 40) • This programme serves to provide strategic leadership and support services, including for the accommodation needs and overall management of the Department of Public Works. It is responsive to meet strategic objective 6 of the Department of Public Works and has links with all four other departmental programmes. • Sub-Programmes • Internal Audit and Investigation Services • Strategic Management Unit • Monitoring and Evaluation • Intergovernmental Relations • Finance and Supply Chain Management • Corporate Services

  6. Highlight/Achievement – Programme One: Administration • The sub-programmes are largely supportive in nature and play a critical role in enabling the core business of the Department to achieve its objectives. • Highlights/Achievements • Increased participation in governance structures (EXCO, Accountability EXCO, Audit and Risk Management Committee where decisions are taken and implementation plans are scrutinised for progress) – (IGR – pages 19 - 25) • Department’s supportive participation in the development of the 2014/15 Annual Performance Plan (APP) - A guiding document that shapes the strategic plans, operational and Risk champions trained to safeguard the Department’s exposure to risk elements (SMU – pages 11 - 18) • Assistance provided to Provincial Departments of Public Works in developing performance indicators as part of the Department’s roles and responsibilities on concurrent mandate. Some of the issues are discussed at MINMEC (M&E – pages 26 - 28) • Developed Supply Chain Management (SCM) Policy for better procurement, one of the key challenges facing the Department (Finance and SCM – pages 29 - 30)

  7. Cont. • The Department held successful wellness with all regional offices and 9 other government departments – (Corporate Service – pages 31 -40) • These Employee Health and Wellness programmes range from • Emotional • Substance abuse • Debt management • Awareness & education • Physical wellness • The Department also produced a Progress report on international human rights instrument on the mainstreaming of Gender/ Disability and Youth through recruitment, procurement, constitution of Committee and Job creation in all DPW programmes

  8. Programme 2 Immovable Asset Management (Pages 41 - 71) • This programme is the largest programme of the Department of Public Works and appropriates at least 48 percent  of the departmental allocation budget. It provides for the management of government’s immovable property portfolio in support of Government’s social, economic, functional and political objectives. In line with the mandate of the Department of Public Works, this programme seeks to achieve the first four strategic objectives of the Department of Public Works • Sub-Programme • Strategic Asset Investment Analysis • Project and Professional Services • Inner-City Regeneration • Operations Management • Key Accounts management • Prestige Management

  9. Programme Two: Immovable Asset Management • The strategic objective of this programme is to provide leadership in effective and efficient Immovable Asset Management and in the delivery of infrastructure programmes • Highlights/Achievements • Management of property debtors in terms of signed contract terms and conditions relevant legislation/regulations and policy were achieved. A total of 1516property debtors were managed against the target of 1453 - (Reg. Coordination – pages 50 - 62) • Full participation of other government departments in DPW’s workshops on User Asset Management Plans (U-AMPs). U-AMPs are tactical plans for managing an organisation's infrastructure and other assets to deliver an agreed standard of service (DRDLR and DHA) - (KAM – pages 65 - 70) • Prestige Policy that spells all the standards and norms in their operations to fulfil its mandate completed - (Prestige management – pages 63 - 64)

  10. Cont.… • Department’s critical role in the development of precinct Development plans within the city of Tshwane. These plans include the West Capital and Paul Kruger Streep in Tshwane - (ICR – pages 71 - 72)

  11. Programme 3 Expanded Public Works programme (Pages 72 – 76) Programme 3 ensures the creation of work opportunities and the provision of training for unskilled, marginalised and unemployed people in South Africa by coordinating the implementation of EPWP. This programme focuses predominantly on the achievement of strategic objective 4

  12. Programme Three: EPWP • EPWP plays a critical role of : • Promoting an enabling environment for the creation of short and sustainable work opportunities that eventually contribute to the national goal of job creation and poverty alleviation. • Providing technical support to Municipalities in planning and implementing labour-intensive projects. • Highlights/Achievements • In the second quarter significant progress was made by municipalities in reporting their progress to the Department enabling the Department to reflect on a definite figure about the performance of the programme- (EPWP – page 73) • Also, a large number of work opportunities were created with substantial improvements in the EPWP participation among designated groups- (EPWP – page 74)

  13. Programme 4 Property & Construction Industry Policy Regulations (Pages 77 – 81) This programme promotes the growth and transformation of the construction and property industries, promote uniformity and best practice in construction and immovable asset management in the public sector. This programme contributes to the realisation of strategic objectives 2, 4 and 5

  14. Programme 4: Property and Construction Policy • This programme ensures transformation and regulation of the Construction and Property industries to ensure economic growth and development. • It is a dependent programme and largely a process or chain-event driven in nature. It often experiences challenges such as delays in stakeholder feedback on particular policy and political considerations. Its function has a huge impact in the built environment. • Highlights/Achievements • Consultations held with key stakeholders and EXCO on Draft BEP Policy - (PCIPR – page 78) • Inputs consolidated and 2nd Draft Guideline developed on condition assessment for general buildings - (PCIPR – page 80 - 81)

  15. Programme 5 Auxiliary and Associated Services (Pages 82 – 83) This programme provides for various services, including compensation for losses on the Government assisted housing scheme and assistance to organisations for the preservation of national memorials. Meet the protocol responsibilities for state functions.

  16. Programme 5: Auxiliary and Associated Services • Highlights/Achievements • Infrastructure support provided to 4 planned & 6 unplanned Prestige Events - (AAS– page 83)

  17. AREAS OF FOCUS (KEY CHALLENGES) • Capacity Constraints • Line function at planning in determining the required resources to feed into the HR Plan • SCM Processes • Delays experienced through the procurement processes • Budget Constraints • Promote Performance based budgeting. A practice of developing budgets based on the relationship between program funding levels and expected results from that program • IT Constraints • Lack of integrated systems affecting data integrity, delays and security issues

  18. Remarks on Performance information • The Department takes into consideration the recommendations made by the oversight bodies such as the: • Portfolio Committee on Public Works, Parliament of South Africa • Auditor-General of South Africa • Audit and Risk management Committee. • The contributions by these bodies include ensuring that programmes/projects are effectively monitored towards achieving their goals and internal controls tightened to curb misconduct that may hamper service delivery • Throughout the financial year, while taking these contributions into account, the Department continues to find ways of improving in areas of concern and effectively contribute to service delivery

  19. Part B • Financial Information • DPW • PMTE

  20. CONTENT

  21. 1. Financial Performance Report 2013/14

  22. Summary Expenditure per Economic Classification

  23. Summary Expenditure per Programme

  24. Notes to the expenditure • The overall expenditure for the department as at the end of September 2013 is R2.7 billion and expenditure is equivalent to 43% of the total allocation. 7% less than the guideline of 50% • Compensation of employees’ expenditure for the month ended September is R707 million and the amount spent is equivalent to 48% of the total allocation. • Expenditure for compensation is in line within the guide line of 50%. • Future expenditure for Compensation is projected to increase higher than the guideline as advertised posts for professionals are being filled and performance bonuses are processed. • Goods and Services expenditure for the month ended September is R320 million and expenditure is equivalent to 37% of the total allocation. • Expenditure for Office Accommodation for the month ended September 2013 is R112 million, and expenditure is equivalent to 22% of the total allocation of R504 million.

  25. Notes to the expenditure • Expenditure for transfers and subsidies for the end of September is R1.335 billion and expenditure is equivalent to 53% of the total allocation. • Transfers and subsidies expenditure of 53% relates to: • Council for the Built Environment R19 million • Commonwealth War Grave R18 million • CIDB R36 million • Aug Prop Man Trade Entity R341 million • EPWP Non-state Sector R230 million • EPWP Integrated Grant to Provinces R177 million • EPWP Integrated Grant to municipality R202 million • EPWP Social Sector R103 million • Independent Development Trust R50 million • Parliamentary Villages R8 million

  26. Notes to the expenditure • Infrastructure expenditure for the end of September is R141 million and expenditure is equivalent to 21 % of the allocation of R676 million. • An amount of R200 million has been requested to be adjusted to compensation of employees and goods and services as part of the adjustment estimates. • The purpose of the adjustment is to finance the compensation of employees shortfall and goods and services for turnaround where roll over not being approved. • Machinery and equipment expenditure for the end of September is R30 million and expenditure is equivalent to 30% of the total allocation of R102 million .

  27. 2. Expenditure per programme

  28. Expenditure per Economic Classification: Programme 1

  29. Notes to the expenditure • The total expenditure for Programme 1 is R404 million and expenditure is equivalent to 35 % of the allocation for the programme. • Current payments • Compensation of employees expenditure is R112 million and expenditure is equivalent to 49% and the expenditure is in line with the guideline of 50%. • Goods and services expenditure is R172 million and expenditure is equivalent to 45%. • Expenditure for Goods and services under Office Accommodation is at R112 million which is 22% of the total allocation of R504 million • Transfers and subsidies • Transfers and services expenditure for R518 000 and expenditure is equivalent to 45% of the allocated budget of R1.1 million • Payments for Capital Assets • Machinery and equipment expenditure is R7.7 million and expenditure is equivalent to 26% of the allocated budget of R30 million.

  30. Expenditure per Economic classification: Programme

  31. Notes to the expenditure • The total expenditure for Programme 2 is R1.2 billion and expenditure is equivalent to 42% of the allocation for the programme. • Current payments • Compensation of employees expenditure is R539 million and expenditure is equivalent to 48%. • Goods and services expenditure is R82 million and expenditure is equivalent to 32%. • Transfers and subsidies • The expenditure for transfers and subsidies is R456 million and expenditure is equivalent to 53% of the allocated budget. With the exception of IDT and Parliamentary Village Management Board which have received full allocation, other entities have received 50% of the allocated budget • Payments for Capital Assets • Infrastructure expenditure for the end of September 2013 is R141 million and expenditure is equivalent to 21% of the allocation of R676 million. • Machinery and equipment expenditure is R24 million and expenditure is equivalent to 36% of the allocated budget of R69 million.

  32. Expenditure per Economic classification: Programme 3

  33. Notes to the expenditure • Total expenditure for programme three is R960 million and against the budget of R1.9 billion which is 49% • Current payments • Compensation of employees for programme three is R51 million and expenditure is equivalent 46%. Expenditure for compensation of employees is within the guideline of 50%. • Goods and services expenditure for the end of September is R48 million and expenditure is equivalent to 28% of the total allocation. Expenditure is below the guideline. • Transfers and subsidies • Transfers expenditures is R860 million against the budget of R1.6 billion which is 52%. Expenditure for transfers and subsidies is in line with the payment schedule. • Payment for Capital Assets • Machinery and equipment expenditure for Programme 3 is R514 000 and expenditure is equivalent to 20% of the allocated budget of R2.6 million.

  34. Summary Expenditure per Economic Classification: Programme 4

  35. Notes to the expenditure • Total expenditure for programme four is R20 million against the budget of R39 million which is equivalent to 50% of the allocated budget of R39 million. • Current Payment • Compensation of employees expenditure is R4.3 million and expenditure is equivalent to 33% of the total budget of R14 million. • Goods and services expenditure for September is R4.9 million and expenditure 19% of the allocated budget. • Transfers and subsidies • Transfers and subsidies expenditure is R10 million and expenditure is equivalent to 5213% of the allocated budget of R200 000. The high expenditure relates to the transfer to Agrement SA and expenditure is classified as irregular expenditure as the budget is classified under goods and services. • Payment for capital Assets • Expenditure for machinery and equipment R21 000 and expenditure is equivalent to 17% of the allocated budget of R125 000.

  36. Summary Expenditure per Economic Classification: Programme 5

  37. Notes to the expenditure • Total expenditure for programme five is R30 million against the budget of R50 million which is equivalent to 59%. • Current Payment • Goods and services expenditure for the end of September is R12 million and expenditure is equivalent to 45% of the allocated budget of R27 million. Expenditure for goods and services relates to State Functions. • Transfers and subsidies • Expenditure for transfers and subsidies is R17 million and expenditure relates to payment made to the Commonwealth Wargraves Commission. • Transfers and subsides expenditure is equivalent to 75% of the allocation for transfers and subsidies.

  38. 3. Summary Expenditure per Branch

  39. Budget and expenditure per branch

  40. Budget and expenditure per branch

  41. 4. Summary Expenditure per Region

  42. Budget and expenditure per Region

  43. Budget and expenditure per Region

  44. 5. Earmarked Budget and Expenditure

  45. Earmarked Budget and Expenditure

  46. Earmarked Budget and Expenditure

  47. PMTE: Financial Performance Report 2013/14

  48. Financial Performance of the PMTE

  49. Expenditure Analysis of the PMTE

  50. Expenditure Analysis of the PMTE • Expenditure trends are lower than the previous year although projections by the executing units indicate a possible over-expenditure (less than 1% if Leases are taken out of the equation). This will be managed towards year-end to ensure no over-expenditure takes place. • Leasing expenditure is currently higher than the estimated budget for the year according to the information on our internal system. Regions have been requested to update the information to enable better forecasting. The estimated budget will be adjusted accordingly. • Revenue = expenditure at the end of the financial year as invoices are issued and money claimed based on the actual expenditure • Cleaning and Gardening are at 35% expenditure against budget. • This is due to longer term contracts only being finalised recently. The expenditure is expected to increase in the latter part of the financial year.

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