PRESENTATION TO THE SELECT COMMITTEE ON APPROPRIATIONS DATE: 24 TH AUGUST

PRESENTATION OUTLINE  Infrastructure  FET Grant  HIV/AIDS  National School Nutrition Program

INFRASTRUCTURE

INFRASTRUCTURE GRANT EXPENDITURE TRENDS 2010/11 PROGRAMMEALLOCATIONEXPENDITUREVARIANCEEXPENDITUREVARIANCE R’000 % Programme 2436,68612,192424, Programme 2 : FET RECAPITALISATION2, EPWP Programme 439,9081,17238, Programme 727,

REASONS FOR UNDER-EXPENDITURE The inability to honour payments in the last quarter of 2009/10 due to cost containment measures resulted in incorrect Table B5 for 2010/11 Table B5 had to be revised thus leading to re-loading of infrastructure projects on BAS. This further resulted in first payments being effected in May Inability to pay for projects, due to the following reasons:  Reconciliation with Public Works took longer than anticipated due to current projects not on B5 or underfunded on both B5 and BAS Moratorium from Provincial Treasury, wherein the Department of Education was instructed not to commit any funds from the Provincial Infrastructure Grant for programme 2. The allocation for the FET high school recapitalization will be utilized for planning in the 2011/12 implementation of infrastructure projects

REMEDIAL ACTION Due to the looming budget cut on the equitable share, it has been decided that current projects funded under equitable share, must be taken to the Provincial Infrastructure Grant The abovementioned situation will reduce the under-expenditure drastically, since the intended projects are already continuing.

FURTHER EDUCATION & TRAINING

ITEMBUDGET Allocation for 20010/11R555,208 m % Allocation100% Transfers up to 30 June 2010R185,087m Actual Expenditure up to 30 June 2010R123,152m % Expenditure up to 30 June % FIRST QUARTER EXPENDITURE REPORT

ACTUAL EXPENDITURE PER COLLEGE CollegeCoETransfer payments Total King Hintsa5,9915,06011,051 Buffalo City10,7228,90919,631 Lovedale7,4394,56712,006 Ingwe4,9324,6399,571 Port Elizabeth16,4819,66626,147 Ikhala4,7946,80811,602 East Cape Midlands6,30613,12819,434 King Sabata6,8594,92011,779 63,52457,697121,221

REASONS FOR UNDER EXPENDITURE Other expenses amounting to R1,931m were incurred at Head Office Initially the transfers to FET Colleges were to be made twice a year but during April the Ministry for Higher Education indicated they must be paid quarterly. The actual transfer to Treasury was more. Included in the payment for the quarter is the payment of educators who opted to remain with the old employer - these have now been transferred from this programme

CHALLENGES Non placement of educators who opted to remain with the old employer - these are costing the department approximately R33 million in the current financial year The budget amount of R7,982 m set aside for the office and to finalise infrastructure projects in progress under this programme, is inadequate for the current financial year. There is projected over expenditure on infrastructure under this programme

REMEDIAL ACTION The Department is working with Higher Education Ministry in the process of placing the ex-college lecturers who opted to remain with the department back to the FET colleges The department is utilising slow moving projects in order to temporarily fund the projected over expenditure but this will not assist once these projects pick up.

HIV AND AIDS LIFESKILLS

2006/072007/082008/092009/10 (unaudited) R’000 AllocationR 25,113R 26,797R28,542R 30,168 TransfersR 25, 805 (R 692,000 Rollover) R 26,797R 28,542R 30,168 Actual Expenditure R 25,981R 26,394R 29,451R 27,577 Under/over expenditure (R 176)R 413(R 959)R 2,591 Spending as a % of total 100.7%98.5%103.4%91% FINANCIAL TRENDS IN ALLOCATION/TRANSFERS/ACTUAL EXPENDITURE

ITEMBUDGET Allocation for 20010/11R32,189,000 % Allocation100% Transfers up to 30 June 2010R 8,047,250 Actual Expenditure up to 30 June 2010R 2,825,176 Total under Expenditure up to 30 June 2010R 5,222,074 % Expenditure up to 30 June % FIRST QUARTER EXPENDITURE REPORT

Key Performance AreaOutcome Indicators OutputTarget for 2010 Actual for 1 st Quarter ADVOCACYIncreased awareness on HIV and AIDS Lifeskills programme No of learners, educators and school communities reached through HIV and AIDS campaigns TRAINING AND DEVELOPMENT Quality Sexual Reproductive Health and HIV prevention programmes implemented in all primary and secondary schools Number of educators trained in infusing and integrating HIV and AIDS into the curriculum and Peer Education TRAINING AND DEVELOPMENT Quality Sexual Reproductive Health and HIV prevention programmes implemented in all primary and secondary schools Number of schools which have fully infused and integrated HIV and AIDS and Lifeskills into the curriculum TRAINING AND DEVELOPMENT Quality Sexual Reproductive Health and HIV prevention programmes implemented in all primary and secondary schools Number of educators trained in Expressive Art Therapy 1100Nil

Key Performance AreaOutcome Indicators OutputTargetActual for 1 st Quarter LTSMNCS compliant LTSM in all public ordinary schools Number of schools to receive appropriate HIV and AIDS and Lifeskills LTSM during the planned financial year Nil CARE AND SUPPORTSchools with OVC care and support programmes Number of schools with OVC care and support package 300 CARE AND SUPPORTIncraesed Access, Retention and Academic achievement for OVC Learners accessing the OVC care and support package of the ECDOE CARE AND SUPPORTTrained Health Advisory Committees in policy development and implementation Number of Health Advisory Committees trained in HIV and AIDS and Health policy development and implementation 300Nil

Key Performance Area Outcome Indicators OutputTargetActual for 1 st Quarter PEER EDUCATIONNumber of reported teenage pregnancies A decrease in the number of reported cases of learner pregnancy 7500Statistics pending from EMIS PEER EDUCATIONTrained learners in Peer Education Number of trained learners in Peer Education PEER EDUCATIONSchools with functional Peer Education programme Number of schools with functional Peer Education programme MONITORING AND SUPPORT Regular submission of monitoring reports, to evaluate the effectiveness of the curricular intervention programmes 100% compliance in the submission of monthly reports 27635

Key Performance Area Outcome Indicators OutputTargetActual for 1 st Quarter MONITORING AND SUPPORT Regular submission of monitoring reports, to evaluate the effectiveness of the curricular intervention programmes Schools visited MONITORING AND SUPPORT Regular submission of monitoring reports, to evaluate the effectiveness of the curricular intervention programmes Meetings held41

PROJECT/ FUNCTIONHUMAN RESOURCEBRIEF Overall management and coordination of programme - 1 Provincial Lifeskills HIV & AIDS Coordinator -7 Provincial Officials - 23 District coordinators -Training of 2000 educators in Integration of HIV and AIDS into the curriculum -Coordination of all Lifeskills HIV and AIDS projects, seminars, conferences and campaigns -Report writing - Monitoring and Evaluation of programme Integration of HIV & AIDS into the curriculum -20 Trainers-Capacity building of 2000 Educators in Lifeskills Peer Education programme in 800 schools Out of School Youth (Peer Group Trainers) -Training of learners in Peer Education (Grade 7-12) - Coordinate Campaigns against Teenage Pregnancy and Drug and Substance Abuse in 800 schools and surrounding communities Orphans and Vulnerable Children’s programme in 300 schools Volunteers (Caregivers) - 1 Project Manager 19 Project Officers -Facilitate academic, material and psychosocial support to orphaned and vulnerable learners to promote access and retention of this category of learners to the education system -13 Districts (Lusikisiki,Libode,Maluti, Sterkspruit,Mthatha,Cofimvaba,PE,EL,KWT,Dutywa,Lady Frere,Mt Fletcher,Bizana) Health Advisory Committees in 300 schools - 23 District coordinators - 1 Project Manager -19 Project Officers -Establishment and Capacity building of 300 Health Advisory Committees to ensure functional Lifeskills HIV and AIDS and Care and Support programmes for vulnerable learners ASSESSMENT OF MONITORING CAPACITY

REASONS FOR UNDER-EXPENDITURE A technical problem in the payment of an invoice for the OVC programme (BID SCMU-08/ ) trapped in the system for more than two months resulted in non payment of this tender until it was resolved in July 2010 This also impacted negatively on the implementation of the OVC Programme and expenditure for the quarter. Delays in the payment of stipends for 330 learner support agents (caregivers) and 223 Peer Group Trainers for April, May and June 2010 due to capacity problems in the directorate

) MECHANISM TO DEAL WITH THE UNDER- EXPENDITURE A Turnaround Plan has been developed to ensure that the HIV & AIDS Conditional Grant is not affected by the current budget pressures in the ECDOE Systemic challenges which were hindering the payment of invoices (BID SCMU-08/ ) have been sorted and a recovery plan has been developed to make up for the lost time in the OVC programme Two admin clerks have been placed in the Directorate and this will assist in payment of stipends on a monthly basis to the 553 volunteers (caregivers and PGTs)

COMPLIANCE WITH REPORTING Monthly In Year Monitoring meetings were held and monthly reports were submitted to FINCOMM The programme compiled with the submission of reports to the Department of Basic Education as the transferring Department All schools implementing the programme have also been monitored by districts Annual Evaluation for 2009/10 was conducted from the May 2010 and report and forwarded to Department of Basic Education

NATIONAL SCHOOL NUTRITION PROGRAMME

25 HISTORICAL PERSPECTIVE Problematic Transfer from DOH to DOE in Inheritance of Q4,Q5 and ECD outside conditional grant - Payment backlogs Virtual Collapse of SNP in 2006 due to premature incorporation of cooperatives -Forensic Audit by Ngubane and Associates - Abrupt stoppage of programme due to investigation created more payment backlogs estimated at R 40 m 1

26 HISTORICAL PERSPECTIVE (CONT.) All outstanding invoices for these periods are being audited and additional funding will be required to eliminate payment backlogs. Roll-over funds of 2007/08 ( R42, 362m) that was not granted to the Department may assist to deal with these payment backlogs

27 FINANCIAL TRENDS IN ALLOCATION/ TRANSFERS / ACTUAL EXPENDITURE NATIONAL SCHOOL NUTRITION PROGRAMME 2006/07 ‘ /08 ‘ /09 ‘ /10 ‘000 Allocation266,107333,836413,658486,695 Transfers170,156333,836413,658486,695 Actually Expenditure 170,156291,474405,664475,39 Under-/over expenditure 95,95142,3627, Spending as a % of total 64%87%98%

BUDGET ALLOCATION YearAllocation R’000 Roll- over R’000 Additional AllocationTotal R’000 Target Learners 2006/ (Gr. R to Gr4) 2007/ (Gr. R to Gr7 2008/ No roll over approved ( inflation adjustment) ( preparation cost for Q1 secondary Schools) 413, 6581,376,617 (Gr. R to Gr. 7) 2009/ No roll over approved _486, ,305 (Gr. R to Gr. 7in Primary and Quintile 1 Secondary) 2010/11702,936Application for roll over made, not yet approved _702, learners in Grades R-7 in Q1-3 Primary schools over 186 days learners in Grades 8-12 in Q1 and Q2 Secondary schools over 186 days

29 EXPLANATION OF UNDER EXPENDITURE D elays in the loading of the conditional grant budget in April (due to conditional grant codes) which allowed payments to be made only in the last week of April (mostly accruals for January to March 2010) Slow, late and non submission of 1401’s BAS entity forms by schools which is an additional control measure and prerequisite for transfer of meal servers payments to schools. The non awarding of NSNP tender resulted in further extension in April-June which was approved late in June with the old price i.e.R1.65 instead of R1.95 for primary schools and R2.00 for secondary schools instead of R2.95 and this translated to delays in payments. The extended tender continued to provide food excluding Quintile 2 senior secondary schools from April to June due to non-awarding of the tender

30 MECHANISM TO DEAL WITH THE UNDER EXPENDITURE Capacity issues in the programme are being addressed by assistance from the Payment Directorate to clear all the April- June payment backlogs. Appointment of an Audit team to deal with payment backlogs dating back to 2004 to ensure clearance of backlogs. In addressing under expenditure the memorandum of understanding (MOU ) signed by the Department with King Hintsa FET College to be extended in order to provide quintile 3 schools and primary schools with mobile kitchens and feeding utensils in the current quarter Awarding of the new SNP and the rollout thereof in October 2010 will assist in addressing under expenditure. 5

ITEMBUDGET Allocation for 2010/11R First Quarter allocation 1)For feeding 2) Preparation budget for Q3 Secondary School Total tranche for 1 st Quarter R R R Actual Expenditure up to 30 JuneR Total under Expenditure up to 30 June 2010 ( For first Tranche) R % Expenditure up to 30 June 2010 ( For first tranche)59 0% % Expenditure up to 30 June 2010 ( For entire budget allocation) t15,7% FIRST QUARTER EXPENDITURE REPORT

32 COMPLIANCE WITH REPORTING Monthly In year monitoring reports were submitted to FINCOM. Monthly and Quarterly reports were submitted in compliance to DORA Compliance to Menu and supplier performance has been monitored by Districts and Head Office staff (Coordinators and EDO’s) and action taken against non performing suppliers to avoid wasteful expenditure. Regular monitoring visits by Districts staff and submission of reports as part of monitoring of spending. Annual Evaluation for 2009/10 was conducted from the May 2010 and reported and forwarded to Department of Basic Education

PROJECT/ FUNCTIONHUMAN RESOURCEBRIEF Provision of Nutritious meals to needy learners by 10h00 each day. 128 service providers 9500 meal servers 128 service providers are contracted to supply foodstuffs to all quintile 1-3 primary schools and to quintile 1-2 secondary schools. A political mandate to feed quintile 4 and 5 primary schools was also received. Meal servers are governing body appointees which are appointed and trained to empower them with food handling and food hygiene skills. Monitoring of feeding23 District coordinators 43 monitors on contract 3 Cluster coordinators There are 23 vehicles,1 per district which are designated for monitoring purpose, Monitoring reports are submitted for actioning on a daily and weekly basis Payment of service providers and meal servers Food production Nutrition Education Staff of 17 at Head office are in charge of payments 2 Food garden coordinators (assistant directors) at head office level assisted by 23 district coordinators 23 District coordinators NSNP educators Payments are done within 30 days where all documents are available. For meal servers the current payment system is causing delays as it requires schools to pay and claim. All schools that benefit from the SNP are encouraged to establish food gardens. Most have productive gardens while others struggle with plots and water. Schools are provided with garden equipment by the department and through partnerships with other sectors. There is a challenge of exorbitant water consumption due to these food gardens which result in schools not affording/paying for municipal services. Nutrition Education on food a preparation, handling and hygiene is conducted for NSNP educators and meal servers.

34. AREAS OF CONCERN POSSIBLE CORRECTIVE MEASURES CHALLENGES The non awarding of previous years rollovers result in paying backlogs and accruals from the current budget and this poses a challenge. Continuous feeding of learners in quintiles 4 & 5 and standalone ECD centres will result in unauthorized expenditure in the current financial year Delays in awarding of tenders advertised for feeding result in continuously extending contracts of current SNP suppliers this results in deviation from the business plan in terms of implementation of new menu with the new prices. Payment of accruals and backlogs some dating back to 2004 results in utilization of current budget on accruals and backlogs. 7

35. AREAS OF CONCERN POSSIBLE CORRECTIVE MEASURES CHALLENGES (Cont.) Weaknesses in monitoring result in inaccurate data for budget planning (e.g confirmation of number of grade R ‘s both at schools and at stand alone ECD sites, closed schools,farm schools will assist the Department in accurate budget planning) Staff shortage in the NSNP Directorate and in some districts is further exacerbated by the absence of a Director for NSNP and this affects implementation and management of the programme generally. Labour unrest in the department at Head Office has an impact on the timely processing of payments and delays in awarding of tenders.

36. MECHANISMS TO DEAL WITH THE CHALLENGES An application for a rollover or appeal for additional funding will be made to the Provincial Treasury to deal with the payment backlogs dating back to 2004 Since no funding is available from the equitable share, feeding of these learners under Q4and % and ECD centres will have to stop as from October These schools will be included in the 2011/12 Business Plan for the SNP Conditional Grant SNP Tender has to be awarded by the first week in September 2010 to ensure timeous issuing of award letters and orders to new service providers by SCM. Monitoring of programme to be improved and learner data to be verified. Payments to current service providers have been updated and are to be made within 30 days

37. AREAS OF CONCERN POSSIBLE CORRECTIVE MEASURES THANK YOU END