Presentation to SCOF on Conditional Grants and Capital Expenditure

1. Presentation to SCOF on Conditional Grants and Capital Expenditure Free State Department of Sport, Arts and Culture 2 September 2009

2. CONTENT • Conditional Grants received by the Department • Library Services • Sport and Recreation • Infrastructure • General Analysis of Trends • Plan to Address Shortcomings • Assessment of Department Monitoring Capacity

3. CONDITIONAL GRANTS RECEIVED BY DEPARTMENT

4. Library Services • Notes • R710 000 has been committed for the procurement of library materials • The business plan was drafted to such that Q1 would used to finalize contracts and issue orders and that delivery of equipment such as computers, photocopiers, security systems would then take place in Q2 and Q3. • The cash flow projection for the business plan thus provided for 13 % of the grant to be spent by end of June, but this was not achieved due to the following challenges: • 3 year contracts were processed for ICT resources, photocopiers, and library materials but put on hold due to a higher decision that, as an interim measure, one-year contracts must be arranged. • Posts yet to be filled

5. Quarterly analysis of Library Services Conditional Grant spending

6. Notes on Library Services Expenditure trends • Appointment of employees • Target: 52 additional staff to be appointed in public libraries • 1st quarter – planning and recruitment • Recruitment delayed due to cost containment measures within the province • Printing and Publications • Target: 50 000 items of library material bought • Book orders to the value of R867 000 not delivered in time for payment • Newspapers and publications • Renewal of subscriptions is done during October-December • Computer datalines and maintenance - Invoices for computer datalines and maintenance of photocopiers not received in time for payment before 30 June 2009: R906 510

7. Notes on Library Services Expenditure trends (cont) • Philippolis Library • Department of Public Works, Roads and Transport busy arranging a new contract after previous contractor defaulted. Challenge is to identify local contractors • Machinery and equipment • 3 year contracts were processed for ICT resources, photocopiers, and library materials but put on hold due to a higher decision that, as an interim measure, one-year contracts must be arranged. • Number of Libraries served by Conditional Grant • Library collections upgraded: 20 libraries • ICT Infrastructure: 59 libraries • Photocopiers: 30 libraries • Additional staff: 50 libraries • Infrastructure: Renovations, security: 10 libraries

8. Notes on Library Services Expenditure trends (cont) • Infrastructure • Upgrade Philippolis Library • Department of Public Works, Roads and Transport busy arranging new sub-contractors • Challenge – to find local contractors • Upgrade security at 10 libraries • Delays with arranging contracts because of new policy directives on handling infrastructure contracts • Provide 59 libraries with ICT infrastructure • Procurement delayed due to directive to arrange 3 year contract and not to use SITA contracts

9. Notes on Library Services Expenditure trends (cont) • Providing equipment to libraries • Provide 31 libraries with photocopiers • Adjudication of bids to be completed • Provincial capacity expanded • 7 staff members appointed within Department • Recruitment delayed due to cost containment measures within the province • Cooperation with municipalities • Sign MoUs with municipalities • Busy with negotiations with municipalities

10. CONDITIONAL GRANTS SPORT AND RECREATION

11. Quarterly analysis of Sport and Recreation Conditional Grant spending

12. Notes on Sport and Recreation Grants • 3 year contracts for event management and attire to be approved during September. • Due to processes being followed by the province on acquiring three year contracts for services envisaged, the following have not been achieved: • Appointment of school sport assistants and cluster coordinators. • Appointment of activity and hub coordinators. • Appointment of code coordinators. • Procurement of attire and equipment • Several goods and services acquired for mobilisation activities and public viewings areas during the Confed Cup 2009 in June and paid after 30 June

13. Notes on Sport and Recreation Grants (cont) • Major outputs of the Conditional Grant: • Siyadlala

14. Notes on Sport and Recreation Grants (cont) • Major outputs of the Conditional Grant: • Club Development

15. Notes on Sport and Recreation Grants (cont) • Club Development (cont)

16. Notes on Sport and Recreation Grants (cont) • Club Development (cont)

17. Notes on Sport and Recreation Grants (cont) • Major outputs of the Conditional Grant: • School Sport

18. Infrastructure (Capital expenditure) • Notes • SLA’s with 2 major municipalities just finalized (R64 million and R11.47 million). Transfer payments effected for R64 million during September. • 2 Projects (Basotho Cultural Village and Philippolis) cancelled during previous year, now back on tender.

19. Infrastructure (Capital expenditure)

20. Infrastructure (Capital expenditure)

21. Infrastructure (Capital expenditure) No significant risks of underspending identified at this stage.

22. Infrastructure (Capital expenditure) (cont) • Challenges during 2009/10: • Contractors to be appointed for Museums so that the cash can flow • Sub-contractors appointed to assist main contractor at Philippolis Library

23. Infrastructure Project Progress

24. Infrastructure Project Progress

25. Challenges with Infrastructure Projects

26. Challenges with Infrastructure Projects

27. General analysis of trends General Analysis of Trends Infrastructure spending is picking up during August 2009 and is expected to keep momentum during September 2009 Library grants transferred from National Treasury in accordance with cash flow plans Sport and Recreation grants transferred from National Treasury in accordance with cash flow plan

28. General analysis of trends General Analysis of Trends (cont) • Challenges: • Approval of business plans just before commencement of new financial year • Delays in recruitment process (advertising), over which the programmes have not direct control • Not all of contract workers in place by 1 April 2009 but to be appointed during 2nd quarter • One-year contracts awarded during 1st quarter for major suppliers, to be delivered during 2nd and 3rd quarter.

29. General analysis of trends General Analysis of Trends (cont) • Remedial measures: • Approval to amend business plan to redirect under-expenditure on compensation budget to other projects

30. Plans to Address Shortcomings • For 2009/10 • Recruitment process to be fast-tracked • 1-year contracts, to be monitored for performance • As from 2010/11 • Proper planning before 1 April, especially with regard to: • Number of coordinators and contract workers required to be recruited by 1 April • Need analysis for goods and services contracts to be in place by 1 April • Events calendar so that public funds can be properly committed, prior to events • Suppliers registered on system for timely payments

31. Assessment of Department’s Monitoring Capacity • Financial Control Committee meeting under chairpersonship of Head of Department • Executive Manager: Sport and Recreation and Senior Manager: Recreation supported by 2 Managers • Executive Manager: Cultural Affairs and Library Services and Senior Manager: Library and Archive Services, supported by 2 Managers (to be filled 1 October 2009) • Expenditure trend-tracking overview by Chief Financial Officer • Finance, Supply Chain Management and Human Resources clerks appointed out of grants to focus on grant commitments • Reporting system: • Quarterly reports to National Department (and National Treasury via Provincial Treasury) with comments on variances • Monthly IYM reports, with comments on variances

32. THANK YOU