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 Library Services SiyadlalaLegacySchool SportInfrastructure R’

4 Library Services Quarter 1 Transfers (13% of total budget) Spending Balance Notes –R 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 Total BudgetQuarter 1 Compensation of employees % Goods and Services % Printing & Publications % Newspapers & Magazines % Equipment <R5 000: Computer & other equipment % SITA: Computer expenses % Other expenses: Travelling, maintenance, etc % Transfers and subsidies552-0 % Capital payments % Philippolis Library % Computer equipment415-0 % Office equipment & furniture % Security equipment % TOTAL % Quarterly analysis of Library Services Conditional Grant spending

6 Appointment of employees –Target: 52 additional staff to be appointed in public libraries –1 st quarter – planning and recruitment –Recruitment delayed due to cost containment measures within the province Printing and Publications –Target: items of library material bought –Book orders to the value of R 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: R Notes on Library Services Expenditure trends

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

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 8 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 9 Notes on Library Services Expenditure trends (cont)

10 Conditional Grant: Sport and Recreation South Africa Quarter 1 Transfers7 023 Spending2 753 Balance4 270 SiyadlalaLegacySchool SportTotal Budget Expenditure Balance CONDITIONAL GRANTS SPORT AND RECREATION

11 Total BudgetQuarter 1 SIYADLALA % Compensation of employees % Goods and Services % Capital Payments % LEGACY % Compensation of employees % Goods and Services % Capital Payments % SCHOOL SPORT % Compensation of employees % Goods and Services % Capital Payments % TOTAL % Quarterly analysis of Sport and Recreation Conditional Grant spending

12 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 Notes on Sport and Recreation Grants

13 Major outputs of the Conditional Grant: –Siyadlala Notes on Sport and Recreation Grants (cont) DatesActivities 17 April 2009Hub festival held in Reddersburg and approximately 200 participants attended. 18 April 2009Elderly event was held in Heilbronn and approximately 250 participants attended. 08 MayWellness ± 400 participants 27 JuneThaba-nchu, Indigenous games district selection

14 Major outputs of the Conditional Grant: –Club Development Notes on Sport and Recreation Grants (cont) DatesActivities 27 April – 02 May  Supported Volleyball Free State in Hosting National Volleyball Club Championship 30 May 2009  Road-show: 2009 Confederations Cup and 2010 World Cup Mass Mobilization Event held throughout Maluti-a-Phofung Municipality in QwaQwa.  200 u/14 football boys bussed to participate in mock-world cup trial guided by the Free State Legends.  Spectators in attendance. 31 May 2009  Road-show: 2009 Confederations Cup and 2010 World Cup Mass Mobilization Event held throughout Matjhabeng Municipality (Odendaalsrus via Welkom).  200 u/14 football boys bussed to participate in mock-world cup trial guided by the Free State Legends.  spectators in attendance.

Notes on Sport and Recreation Grants (cont) Club Development (cont) 15 Dates Activities 17 June 2009  Procured tickets for spectators to watch game were issued: Brazil v/s Iraq 20 June 2009  Procured tickets for spectators to watch game were issued: Bafana Bafana v/s Spain.  Transported 42 Xhariep District coordinators to the game. 24 June 2009  Greening the Nation Project launched at Lochlogan in partnership with the Department of Environment and Tourism.  Indigenous trees were planted.  50+ people in attendance. 24 June 2009Procured tickets for spectators to watch semi- final game were issued: Spain v/s USA

Notes on Sport and Recreation Grants (cont) Club Development (cont) 16 DatesActivities 28 June 2009  PVA pitched in Maluti-a-Phofung (Charles Mopedi Stadium) drew spectators 28 June 2009  PVA pitched in Matjhabeng Municipality (Phakisa) drew spectators

17 Major outputs of the Conditional Grant: –School Sport Notes on Sport and Recreation Grants (cont) DatesActivities May 2009  Three Free State schools namely: Thababg, Viljoenskoon and Heidedal participated in schools FIFA 2009 Confederations Cup tournament in Johannesburg Marks Park 01 June – 05 June 2009  Visit by students from Hampshire London University for the British Linkage Programme 15 June 2009  90 Farm school learners and 10 educators from Lejweleputswa, Motheo and Fezile Dabi were afforded an opportunity to attended the Confederation game in Bloemfontein 17 & 24 June 2009  139 Cluster coordinators and sport assistants attended the FIFA Confederation game in Bloemfontein.

18 Total BudgetQuarter 1 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. Infrastructure (Capital expenditure)

19 Infrastructure (Capital expenditure) Capital projectsBudgetPaymentsBalance% payments Remarks New constructions Qwaqwa Basotho Cultural Village %On track. Fezile Dabi High Performance Satellite Memorandum of Agreement between Department and Fezile Dabi District Municipality yet to be signed. Fezile Dabi Local Talent Development Centre Memorandum of Agreement between Department and Fezile Dabi District Municipality yet to be signed. Edenville Library Contract on track. Payment will pick up during 2 nd quarter. Bloemfontein Sport Museum Contractor yet in process of being appointed. Fezile Dabi Stadium %Payment on track. TOTAL %

20 Infrastructure (Capital expenditure) Capital projectsBudgetPaymentsBalance% payments Remarks Rehabilitation / upgrading NALN Museum Under retention Philippolis Museum Sub-contractors appointed to assist contractor. Presidency Museum Contractor appointed 7/09 Craft Emporium In planning stage Military Museum300- -In planning stage FSSSI Facilities Contractor in process of being appointed Zamdela Arts & Culture Centre %On track Philippolis Library %On track Mangaung Sport Stadium %On track TOTAL %

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

22 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 Infrastructure (Capital expenditure) (cont)

23 Project NameBaselineActual start and expected end date Physical progres s StartEndStartEnd% Free State Sport Museum 1 April 0831 Mar 101 April 0831 Mar 101 % Qwaqwa BCV1 Sept 051 Oct 061 April 0831 Mar 1040 % Afrikaans Literary Museum 1 April 0231 Aug 0815 Nov 05Dec 0880 % Philippolis Museum1 April 0831 Mar 091 April 0831 Mar 100 % Zamdela Arts and Culture Centre 1 April 0931 Aug 0950 % Infrastructure Project Progress

24 Project NameBaselineActual start and expected end date Physical progres s StartEndStartEnd% Philippolis Library1 Jan 0730 Sept 081 March 0931 March 105 % FSSSI Rehabilitation Unit 1 May 051 July 061 April 0931 March 0999 % Fezile Dabi Stadium1 April 0831 Mar 111 April 0831 March 100 % Fezile Dabi HPC & LDC Satellite 1 April 0931 Mar 10Planning31 March 105 % Infrastructure Project Progress

25 ProjectReasons for UnderperformanceRemedial Action CULTURAL AFFAIRS Free State Sport MuseumConstruction not commenced To fast-track bidding process Phillippolis MuseumInadequate performance by contractor Sub-contractors appointed to assist the main contractor. Challenges with Infrastructure Projects

26 ProjectReasons for UnderperformanceRemedial Action SPORT AND RECREATION FSSSI facilitiesConstruction not commencedTo fast-track bidding process Fezile Dabi StadiumShortfall of R30 m on contractMunicipality to source additional funding Challenges with Infrastructure Projects

27 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 General analysis of trends General Analysis of Trends

28 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 2 nd quarter –One-year contracts awarded during 1 st quarter for major suppliers, to be delivered during 2 nd and 3 rd quarter. General analysis of trends General Analysis of Trends (cont)

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

30 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 Plans to Address Shortcomings

31 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 Assessment of Department’s Monitoring Capacity

THANK YOU 32