QUARTER 3 OF THE 2015/16 FINANCIAL YEAR Date: 25 February 2016 PRESENTATION TO THE PORTFOLIO COMMITTEE ON SPORT AND RECREATION ON FINANCIAL PERFORMANCE QUARTER 3 OF THE 2015/16 FINANCIAL YEAR Date: 25 February 2016 Mr. Alec Moemi - Director General Sport and Recreation South Africa

BUDGET AND EXPENDITURE ANALYSIS AS AT 31 DECEMBER 2015 EXECUTIVE SUMMARY The departmental financial performance at the end of the third quarter of 2015/2016 financial year are as follows: The overall spending is at R720.1 million which represent 73% of the total budget allocation. This is within the norm in terms of arithmetic forecast (75%) as its equivalent to nine months. Spending on Compensation of employees is at 69% totalling R69.7 million. There is 6% under spending due to vacant posts of e.g. Director: IT and School Sport. Other vacancies for junior and middle management positions as well as lower levels posts also contributed to the under spending. During the 2015/16 financial year management has approved advertising of all prioritised vacant posts. The filling of vacancies is underway as compared to last financial year this time we had a 9% under spending. This was to allow the organizational review process to be completed before posts are filled on the revised establishment.

BUDGET EXPENDITURE ANALYSIS AS AT 31 DECEMBER 2015 Expenditure on goods and services is at 86% totalling R142.5 million. The acceptable arithmetic forecast of 75%. It must be noted that most of the departmental projects were rolled out in the second and third quarter of the year. Transfer payments’ spending is 70% totalling R506.5 million, which is 5% less than the arithmetic forecast of 75%. It must however be noted that the second and the third quarter transfers are processed as per the approved cash flow except for the three provinces, namely; Limpopo, Western Cape & KZN were withheld due to non-compliance. Payment for capital assets expenditure is at 67% the expenditure is expected to increase once the procurement of IT equipment and software are processed

GRAPHICAL VIEW OF THE BUDGET PER ECONOMIC CLASSIFICATION FOR 2015/16 FINANCIAL YEAR

BUDGET PER PROGRAMME FOR 2015/16 FINANCIAL YEAR

ECONOMIC CLASSIFICATION: COMPENSATION OF EMPLOYEES EXPENDITURE ON COMPENSATION OF EMPLOYEES AS AT 31 DECEMBER 2015 ECONOMIC CLASSIFICATION: COMPENSATION OF EMPLOYEES PROGRAMME BUDGET APR MAY JUN JUL AUG SEP OCT NOV DEC TOTAL EXP TOTAL AVAILABLE % SPENT ADMINISTRATION 66,005 5,312 5,126 5,566 5,498 6,637 6,026 5,597 5,787 6,120 51,669 14,336 78% ACTIVE NATION 16,424 503 520 596 599 756 638 721 511 808 5,652 10,772 34% WINNING NATION 7,306 137 113 190 167 189 262 195 213 310 1,776 5,530 24% SPORT SUPPORT 8,081 951 984 1,197 1,023 1,179 953 884 1,186 753 9,110 -1,029 113% INFRASTRUCTURE 2,889 207 188 182 145 135 158 1,532 1,357 53% TOTAL 100,705 7,110 6,931 7,731 7,432 8,898 8,014 7,564 7,855 8,204 69,739 30,966 69%

EXPENDITURE ON COMPENSATION OF EMPLOYEES AS AT 31 DECEMBER 2015 For the period of nine months the ideal percentage spent should be 75%, however the overall expenditure for compensation of employees is at 69% which is 6% below the ideal percentage. This is mainly due to vacant posts especially those of senior managers, e.g. Director School Sport and Director IT

ECONOMIC CLASSIFICATION: GOODS AND SERVICES EXPENDITURE ON GOODS AND SERVICES AS AT 31 DECEMBER 2015 ECONOMIC CLASSIFICATION: GOODS AND SERVICES PROGRAMME BUDGET APR MAY JUN JUL AUG SEP OCT NOV DEC TOTAL EXP % SPENT ADMINISTRATION 56,577 1,587 3,995 3,483 4,217 4,893 2,843 4,206 5,551 2,593 33,368 59% ACTIVE NATION 38,316 3,671 439 1,309 2,797 7,036 6,809 7,101 27,128 10,737 67,027 175% WINNING NATION 56,215 174 339 685 410 1,384 296 1,556 7,747 8,587 21,178 38% SPORT SUPPORT 7,109 289 1,518 2,038 3,237 4,402 1,851 2,717 1,615 2,490 20,157 284% INFRASTRUCTURE 6,789 22 264 36 277 66 19 65 47 3 799 12% TOTAL 165,006 5,743 6,555 7,551 10,938 17,781 11,818 15,645 42,088 24,410 142,529 86%

EXPENDITURE ON GOODS AND SERVICES AS AT 31 DECEMBER 2015 Total expenditure for goods and services is currently at R142.5 million which represents 86% of the total budget and this does not take into account the known commitments of R3.6 million. The commitments mainly resulted from insufficient supporting documentations which then prevents processing and final authorisation of payments.   Programme 1 Expenditure is at 59% for the period of nine months which is less than nominal rate of 75 % by 16%. Programme 2  The total spending rate is 175%, overspending by 100%, with School Sport at 24%, Community Sport at 462%. Programme manager is at 321%. Transfers to the provinces are at 65%. The spending in school sport will increase once the Ministerial Sports Bursary claims are paid, and School Sport Championship claims and invoices are paid. The overspending in Community Sport is due to payments for the Indigenous Games project and Sport equipment and apparel.

EXPENDITURE ON GOODS AND SERVICES AS AT 31 DECEMBER 2015 Programme 3 The total spending rate is 38%, under spending by 37%, with Scientific Support at 6.3%. Major Events is at 99%. Programme manager there is no spending because at the moment there is no Programme manager. Recognition System is at 58%, the spending will increased after the Sports Awards payments. Programme 4 The spending rate is at a 284% overspending by 209% with programme manager spending at 18%. Expenditure for International Liaison is at 238% with a 163% (overspending). The Sport Service Providers is at 350% which is 275% more than nominal rate. This substantial increase is due to payments for Basketball National League, implementation of the Brutal Fruit Netball Premier League and also due to support provided to the Eminent Person Group (EPG) on Transformation in Sport.  

EXPENDITURE ON GOODS AND SERVICES AS AT 31 DECEMBER 2015 Programme 5 The spending rate is at 12% for the period of nine months which is less than nominal rate of 75% It is projected that the expenditure will increase once the unit commence with the monitoring of development of sport facilities in various provinces.  

ECONOMIC CLASSIFICATION: TRANSFERS AND SUBSIDIES EXPENDITURE ON TRANSFER PAYMENTS AS AT 31 DECEMBER 2015 ECONOMIC CLASSIFICATION: TRANSFERS AND SUBSIDIES ITEMS BUDGET APR MAY JUN JUL AUG SEP OCT NOV DEC TOTAL EXP % SPENT PROVINCIES 537,294 - 179,078 85,173 87,087 351,338 65% DEPARTMENTAL AGENCIES & ACCOUNTS 30,363 19,816 5,235 25,051 83% NON-PROFIT INSTITUTIONS 153,013 18,306 4,000 47,308 33,631 22,683 129,928 85% HOUSEHOLD 50 25 60   135 TOTAL 720,670 179,128 23,816 94,408 33,691 109,770 506,452 70% Transfer Payments The under spending in Transfers and Subsidies is due to withholding of funds to the three provinces namely Limpopo, KZN and Western Cape due to non-compliance. The expenditure on Non-Profit Institutions will increase in the fourth quarter following approval of payments.

ECONOMIC CLASSIFICATION: CAPITAL ASSETS PAYMENTS FOR CAPITAL ASSETS AS AT 31 DECEMBER 2015 ECONOMIC CLASSIFICATION: CAPITAL ASSETS ITEMS BUDGET APR MAY JUN JUL AUG SEP OCT NOV DEC TOTAL EXP % SPENT MACHINERY AND EQUIPMENT 2,167 69 42 45 1,009 135 - 448 -304 1 1,445 67% TOTAL Payments for Capital Assets Expenditure for capital assets has drastically improved from the first quarter due to the procurement of some computer equipment and fixing of the departmental excess doors not yet being approved.