Department of Transport 1 Portfolio Committee on Transport Quarterly Expenditure 28 February 2012

Budget for 2011/12: - Budget per Standard Item - Budget per Programme - Transfer Payment budgets Reporting on expenditure Phasing of budgets Overview of expenditure to 3 rd Quarter 2 Contents

3 Budget per Standard Item Standard ItemBudget R’000 % Compensation of Employees297, % Goods and Services552, % Goods and Services - eNaTIS417, % Machinery and Equipment4, % Transfer Payments34,496, % Total35,767, %

4 Budget per Programme ProgrammeBudget R’000 % Administration289, % Integrated Transport Planning140, % Rail Transport9,542, % Road Transport15,974, % Civil Aviation66, % Maritime Transport140, % Public Transport9,612, % Total35,767, %

5 Budget per Programme (continued) Programme (R’000) Compen- sation of Employees Goods and Services Machinery & Equipment Transfer Payments Total% of total budget % Excl. Transfers Administration117,072161,1161,9589,523289, %22.04% Integrated Transport Planning 62,77176, , %11.05% Rail Transport11,04414,548619,516,8739,542, %2.02% Road Transport39,707467, ,467,33815,974, %39.93% Civil Aviation23,11420, ,31266, %3.44% Maritime Transport17,22892, ,876140, %8.65% Public Transport26,256137, ,449,2239,612, %12.87% Total297,192969,9354,14834,496,14535,767, %

6 Transfer Payment budgets R’000

7 Transfer PaymentsBudget R'000 % Passenger Rail Agency of S.A. (PRASA) 9,474, % S.A. National Roads Agency (SANRAL) 8,651, % Provincial Roads Maintenance6,697, % Public Transport Infrastructure & Systems 4,803, % Public Transport Operations4,153, % Taxi Recapitalisation471, % Other (next slide)245, % Total34,496, % Transfer Payment budgets (continued)

8 Other TransfersBudget (R'000)% Road Traffic Management Corporation77, % Railway Safety Regulator37, % S.A. Civil Aviation Authority15, % Ports Regulator14, % S.A. Maritime Safety Authority7, % Marine Rescue Co-Ordination Centre5, % Road Traffic Infringements Agency5, % Transport Education & Training Authority % Rural Transport Services and Infrastructure35, % S.A. National Taxi Association21, % Universities9, % Foreign memberships8, % Gautrain Rapid Rail Link5, % National Sea Rescue Institute1, % Leave pay % Search and Rescue organisations % Total245, % Transfer Payment budgets (continued)

9 Transfer Payment budgets: Other transfers (continued) Road Traffic Management CorporationRailway Safety Regulator Rural Transport Services and InfrastructureS.A. National Taxi Association S.A. Civil Aviation AuthorityPorts Regulator Universities S.A. Maritime Safety Authority Marine Rescue Co-Ordination Centre Foreign memberships Gautrain Rapid Rail LinkRoad Traffic Infringements Agency National Sea Rescue InstituteTransport Eduction & Training Authority Leave paySearch and Rescue organisations RTMC 77,949 RSR 37,475 RURAL 35,439 SANTACO 21,176 SACAA 15,216 UNIV 9,189 SAMSA 7,599 MRCC 5,865 FORGN 8,845 GAUTRAIN 5,300 RTIA 5,000 NSRI 1,170 TETA 197 LEAVE 137 S&R 132 PR 14, % 18 %

10 PeriodDetailsReport mainly to AnnuallyAnnual Report (Financial Statements) (Treasury template) Parliament, Minister of Transport National Treasury Auditor-General All stakeholders QuarterlyInterim Financial Statements (Treasury template) National Treasury Auditor-General Audit Committee Executive Committee Operational Planning Committee MonthlyEarly Warning System (Treasury template) Minister of Transport Director-General National Treasury Expenditure reports (Own templates) Executive Committee Operational Planning Committee Programme Managers Sub Programme Managers Responsibility Managers Budget Controllers WeeklyFinancial DatabaseAccess via network – any official Reporting on expenditure

11 Expenditure is not always incurred linearly over the year. To enable the Department to measure expenditure against budgets, the budgets are phased over the year for specific items. The following phasing was done to reflect budgets against which expenditure is measured as accurately as possible: Compensation of employees Levels 1 to 12: 8% increase in July 2011 Levels 13 above: 8% increase in Jan Goods and Services and Machinery & Equipment Phased linearly over 12 months excluding eNaTIS Transfers to AgenciesPayments are made quarterly in advance Transfers to SANRAL and PRASA Phased linearly over 12 months Conditional GrantsPhased according to Payment Schedules Other TransfersPhased linearly over 12 months Phasing of budgets

12 Overview of expenditure to 3 rd Quarter Compensation of employees Goods and Services Transfer Payments: Conditional Grants Transfers excluding Conditional Grants Expenditure per Programme Utilisation of under expenditure

13 Compensation of employees per month R’000

14 Compensation of employees cumulative R’ %

15 Goods and Services per month (excl. eNaTIS) R’000

16 Goods and Services cumulative (excl. eNaTIS) R’ %

17 Under expenditure on Goods and Services ProgrammeExpenditurePhased budgetUnder spent Administration94,301120,83626,535 Integrated Transport Planning (ITP)34,75357,70922,956 Rail Transport4,48010,9116,431 Road Transport30,89637,2646,368 Civil Aviation7,48715,1607,673 Maritime Transport44,43869,37124,933 Public Transport79,083102,97023,887 Total295,438414,221118,783 Major variances: Administration: Under spent on Office Accommodation: Difficulties to secure whole building – will save and allocate to other priorities ITP: National Household Travel Survey budgeted for R29,9 million only committed February 2012 – will apply for rollover Rail: Delays with projects: Rail Policy, Rail Act, Rail Economic Regulator Road: Late start of S’Hamba Sonke programme – funds are committed Civil Aviation: Outstanding claims for foreign offices and delay in establishment of Aviation Safety Investigation Board Maritime: Late claims for Oil Pollution and Watch Keeping services contracts Public Transport: Delay in projects, mainly Taxi Recapitalisation 2020 Strategy, upgrade of National Land Transport Information System and review of Bus Rapid Transport – funds reallocated to verifying infrastructure and bus subsidy expenditure in Polokwane

18 Conditional Grants Cumulative R’000 Variances: April: Public Transport Operations Grant (bus subsidies) paid on 4 May instead of in April because payment schedules were finalised late by Treasury Sept: Rural Grant paid late – dispute regarding Frameworks resolved too late December: Public Transport Infrastructure and Systems Grant payment to City of Cape Town delayed in consultation with the City and Treasury: Funds would have been shifted to Gauteng, but Gauteng obtained approval for a rollover. The Department is in consultation with the City of Cape town and Treasury to determine whether the remaining grant must be stopped

19 Transfers excl. Conditional Grants per month R’000 Cumulative Under/ (over) spent R713m R9,6m R17,5m (R8,1m) R8,1m R54,5m R65,3m R116,2m R4,0m April: SANRAL was paid late R721m May to December: Agencies are paid quarterly in advance and less taxi’s were scrapped than budgeted for

20 Transfers excl. Conditional Grants (continued) Transfers excluding Conditional GrantsExpenditure to 3rd Quarter Phased budget Phased variance 3rd Quarter Phased variance 1st Quarter Phased variance 2nd Quarter Passenger Rail Agency of S.A.7,105,5737,105, S.A. National Roads Agency6,488,6946,488, Taxi Recapitalisation324,532353,60129,06915,12150,332 Road Traffic Management Corporation77,94958,462(19,487)00 Railway Safety Regulator28,106 01(1) S.A. Civil Aviation Authority13,53711,412(2,125)1,1252,252 Ports Regulator12,02110,771(1,250)1,2492,499 S.A. Maritime Safety Authority5, Marine Rescue Co-Ordination Centre4, Road Traffic Infringements Agency3, Transport Eduction & Training Authority S.A. National Taxi Association17,50015,882(1,618)294(1,412) Universities5,7766,8921,1162,2972,268 Foreign memberships7,5206,634(886)(2,814)(636) National Sea Rescue Institute1,105878(227)293(520) Leave pay and donations831103(728)(70)(421) Search and Rescue organisations10099(1)3366 Total14,097,09214,101,1074,01517,58054,527

21 Expenditure per Programme

22 Expenditure per Programme (Continued)

23 Expenditure per Programme (Continued) Major variances: Administration: Under spent on Office Accommodation and over spent on Compensation of Employees as a result of restructuring. Compensation of Employees being corrected after restructuring. Integrated Transport Planning : Under spent on Compensation of Employees and Goods and Services because the National Household Travel Survey that was budgeted for R29,9 million only committed February 2012 – will apply for rollover. Rail: Under spent on Compensation of Employees and goods and Services due to delays with projects: Rail Policy, Rail Act, Rail Economic Regulator.

24 Expenditure per Programme (Continued) Major variances: Roads: Under spent on Compensation of Employees and Goods and Services due to a late start of S’Hamba Sonke programme. Over spent on transfers to Agencies because the Road Traffic Management Corporation was paid in advance. Civil Aviation: Under spent on Goods and Services due to outstanding claims for foreign offices and a delay in the establishment of Aviation Safety Investigation Board. Maritime: Under spent on Goods and Services due to late claims for Oil Pollution and Watch Keeping services contracts. Paid for Oil pollution services in January 2012.

25 Expenditure per Programme (Continued) Major variances: Public Transport: Under spent on Conditional Grants because R191,7 million was withheld from the Public Transport Infrastructure and Systems Grant for Cape Town. Under spent on Taxi scrapping R29 million because of slower scrapping than expected. Under spent on Goods and Services R23,8 million due to delays in projects, mainly the Taxi Recapitalisation 2020 Strategy, upgrade of National Land Transport Information System and review of Bus Rapid Transport.

26 Utilisation of under expenditure Administration: Funds will be used to upgrade the switchboard and cabling for R8 million, for a financial model for the Information Technology Hub costing R3,3 million and for the establishment of a Project Management Unit, expected to cost R4 million in this financial year. Expected expenditure for consultants assisting with internal controls, procurement and strategic planning amount to R6 million for the year. Integrated Transport Planning: The National Household Travel Survey project will be committed at a cost of R34 million. Savings will be shifted to this Programme where possible to enable the Department to roll over the full unexpended amount to the next financial year. Rail Transport: Rollovers will be requested for the Rail Policy, Rail Act and Rail Economic Regulator. Road Transport and Civil Aviation: No under expenditure is expected. Maritime Transport: Funds may be needed to cover expenditure of R20 million incurred in January 2012 for costs related to a ship that went aground – the cost may be recovered. Public Transport: Savings will be utilised to cover the cost of new projects to verify infrastructure and bus subsidy expenditure in Polokwane. Treasury approval will be applied for to shift funds from scrapping allowances for this purpose, because the historical cost of scrapping of taxis is below the allocated budget.

Thank you 27