VOTE 15: BASIC EDUCATION

Presentation to the Standing Committee on

Appropriations

30 October 2013

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ALLOCATION AGAINST ACTUAL EXPENDITURE PER PROGRAMME FOR THE 2013/14 FINANCIAL YEAR

PROGRAMMES

2013/14

Expenditure as % of

Adjusted Appropriation

FINAL APROPRIATION

ACTUAL EXPENDITURE AT 30/09/2013

VARIANCE

R’000 R’000 R’000

Administration 335 580 168 745 166 835 50.2%

Curriculum Policy, Support and Monitoring 1 523 621 218 976 1 304 645 14.4%

Teachers, Education Human Resources Development and Institutional Development 984 697 960 020 24 677 97.5%

Planning, Information and Assessment 9 001 598 3 999 112 5 004 630 44.4%

Educational Enrichment Services 5 773 759 3 201 907 2 557 105 55.5%

Total 17 619 225 8 548 760 9 070 495 48.5%

REASONS FOR SLOW SPENDING/DEVIATION PER PROGRAMME

Programme 2: Curriculum Policy, Support and Monitoring (14.4%)• The slow-spending is mainly due to payments i.r.o Kha Ri Gude, only

the first payment of stipends for the volunteers were processed in the month of September, the project did not take place as projected. The 2013 classes for the blind learners have not yet started.

• The delivery of the 2014 workbooks volume 1 started during September 2013 and is expected to be completed by the end of October 2013. Invoices for the printing of these workbooks are expected to be received in a month or two months.

Programme 4: Planning, Information and Assessment • With regard to Programme 4, the bulk of the allocation is in respect of

payment of ASIDI project. The spending did not take place as projected.

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SERVICE

2013/14

Expenditure as % of

Adjusted Appropriation

FINAL APPROPRIATION

ACTUAL EXPENDITURE AT

30/09/2013VARIANCE

R’000 R’000 R’000

Compensation of Employees1 292 253 135 484 156 769 46.4%

Examiners and Moderators 18 440 2 169 16 271 11.8%

Transfers to Public Entities 991 529 942 697 48 832 95.1%

Other Transfers 37 250 998 36 252 2.7%

Conditional Grants 12 370 622 6 690 740 5 667 279 54.1%

Schools Infrastructure Backlogs Indirect Grant

1 955 981 351 834 1 604 147 17.99%

Earmarked Funds 1 634 671 238 390 1 396 281 14.6%

Departmental Operations 104 183 69 003 35 180 66.2%

Office Accommodation 149 824 72 924 76 900 48.7%

Projects 64 502 44 521 19 981 69.0%

Total 17 619 255 8 548 760 9 070 495 48.5%

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ALLOCATION OVER THE 2013/14 FINANCIAL YEAR

1 Excludes Compensation of Employees for Earmarked Funds as well as Examiners and Moderators

SERVICE

2013/14

Expenditure as % of Adjusted

Appropriation

FINAL APPROPRIATION

ACTUAL EXPENDITURE AT

30/09/2013VARIANCE

R’000 R’000 R’000

Earmarked Funds: 1 634 671 238 390 1 396 281 14.6%

Kha Ri Gude Literacy Project 549 695 139 208 410 487 25.3%

EPWP: Kha Ri Gude 59 238 22 112 37 126 37.3%

Workbooks 859 291 31 335 827 956 3.6%

IQMS 39 749 19 637 20 112 49.4%

Systemic Evaluation 22 969 5 340 17 629 23.2%

NEEDU 13 385 10 858 2 527 81.1%

NSNP 15 344 5 781 9 563 37.7%

National Assessment 75 000 4 119 70 881 5.5%

Conditional Grants: 12 370 622 6 690 740 5 667 279 54.1%

Education Infrastructure 6 643 267 3 509 181 3 121 483 52.9%

National Schools Nutrition Programme 5 173 081 3 028 269 2 144 812 58.5%

HIV and AIDS (Life Skills Education) 213 507 85 404 128 103 40.0%

Dinaledi Schools 109 235 34 758 74 477 30.0%

Technical Secondary Schools Recapitalisation 231 532 33 128 198 404 14.3%

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DETAILS OF EARMARKED ALLOCATIONS/TRANSFERS OVER THE 2013/14 FINANCIAL YEAR

REASONS WHICH CONTRIBUTED TOWARDS UNDER SPENDING

Programme 4: Planning, Information and Assessment (ASIDI)

1. At the inception of the programme, insufficient technical capacity affected the planning necessary to align implementation and the budget cycles. This has now been remedied.

2. DBE uses Implementing Agents (IAs) as a mode of ASIDI delivery. It is apparent that the technical capacity of many of the appointed Implementing Agents is not sufficient and this has resulted in longer procurement processes and, in several instances, poor management of professional service providers. This is improving as the programme progresses.

3. Services rendered by some of the Professional Service Providers have been very poor resulting in delayed deliverables and lack of sufficient attention to managing contractors on site. The number of projects per IA has been reduced to manage this risk.

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REASONS WHICH CONTRIBUTED TOWARDS UNDER SPENDING

4. Some of the committed funds could not be spent as planned due to some of the following reasons:

i. Poor performance by some contractors necessitated the termination of contracts, replacement turnaround time has been too slow due to a variety of reasons that have to do with following the right processes and litigation, in cases, and this has resulted in further delay to completion of projects. For example, TBP contract with 6 schools was terminated on the 11 Sept 2012 and replacement contractors started in Dec 2012. Another reputable contractor, Armstrong, left the DBE stuck with the processes involved in finding alternative contractors for 12 schools. In total 27 schools were affected.

ii. Majority of the ASIDI backlogs are in the remote rural areas where access to the sites is difficult due to the topography and poor road conditions. This has resulted in difficulty in delivering materials to sites.

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REASONS WHICH CONTRIBUTED TOWARDS UNDER SPENDING

iii. These gravel roads are not accessible during the rainy season and this has resulted in valid delays to construction progress and extension of time claims from contractors.

iv. The scale of the investment in a short period of time also meant that critical implementation constraints were experienced particularly in the Eastern Cape because of a shortage of bricks and cement.

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REMEDIAL ACTIONS GOING FORWARD

1. The commitments (Value of work allocated to Implementing Agents) as at 30/9/2013 were R6.3 billion from inception of the ASIDI programme.

2. The above commitments include, a further 201 schools have been allocated to Implementing Agents to replace inappropriate schools of which 56 new schools are already under construction. This work is being implemented by a range of IAs that include CDC, IDT and the Department of Public Works. Mvula Trust, CSIR, CDC, IDT and two provincial education departments have been allocated all the remaining ASIDI water and sanitation projects to implement with ESKOM taking all the remaining electrification projects. ASIDI will deliver all schools originally planned for as well as the close to a thousand water, sanitation and electrification projects.

2. The Department will replace 221 mud and dilapidated structures in the Eastern Cape with mobile classrooms, toilets and in some cases, administration facilities. The tender procedure is underway and evaluations on preferred bidders will commence shortly. It is envisaged that this project will cost between R300 and R400 million . The final completion date is envisaged to be 31 March 2014.

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REMEDIAL ACTIONS GOING FORWARD

3. The following controls are in place to enhance performance and reduce the risk of poor performance:

i. Additional Implementing Agents have been awarded and contracts tightened to include penalties for non-performance by IAs.

ii. Amount of projects awarded to a single service provider has been limited to a maximum of 5 to a contractor and 10 to PSP in order to mitigate the risks associated with termination and/or poor performance.

4. DBE has recruited additional internal capacity to ensure efficient management of the programme.

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REQUESTED ROLL-OVERSThe following Roll-overs amounting to R1 362.006 billion were requested by the Department:

• School Infrastructure Backlog Indirect Grant R1 289.850 billion

• Teachers Union Collaboration Project R38.755 million

• HIV and AIDS ( Life Skills Education) Conditional Grant R5.988 million

•Technical Secondary Schools Recapitilisation Conditional Grant R10.680 million

• Dinaledi Schools Conditional Grant R4.067 million

• Curriculum Policy and Support (Kha Ri Gude) R12.666 million

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ROLL-OVER REQUESTED NOT APPROVED PER PROGRAMME

PROGRAMMESAmount

RequestedR’000

School Infrastructure Backlog

Curriculum Policy, Support and Monitoring (Kha Ri Gude)

1 289 850

12 666

Teachers, Education Human Resources Development and Institutional Development (Teachers Union Collaboration Project ) 38 755

Educational Enrichment Services (HIV and Aids Life Skills Education) 5 988

Total 1 347 259

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ROLL-OVER APPROVED AND ADDITIONAL FUNDING

PROGRAMMESAmount

RequestedR’000

Technical Secondary Schools Recapitilisation Conditional Grant 10 680

Dinaledi Schools Conditional Grant 4 067

EIG Conditional Grants disaster relief (Additional) 12 603

Total 27 350

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ADJUSTED ESTIMATES OF NATIONAL EXPENDITURE

PROGRAMMESAmount

RequestedR’000

ENE 2013 - Main Appropriation 17 591 905

Roll- Over 2013 – Adjusted Estimate 14 747

EIG Conditional Grant - disaster relief 12 603

AENE 2013 – Adjusted Estimate 17 619 255

Conclusion• The big part of the Departmental allocations is

Conditional Grants and Earmarked funds leaving very little for operations and projects.

• With the roll-over request of R38.755 million for Teacher Union Collaboration not being approved, R26 million has been spent on this project to-date and it will put strain on the available funds for the Department in respect of operations and projects if it has to be found internally.

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Thank you

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