Hospital Revitalisation Grant: 2010/11 Financial Year Presentation to the Select Committee on Finance October 2010

.. Background The Hospital Revitilisation Grant is utilised to replace and revitalise current hospitals in the Province. Prioritization of the projects is done as per the Departmental Service Transformation Plan. The following projects have been prioritised in the allocation: – –Mental Health Hospital; – –Upington Hospital; – –De Aar Hospital; – –Prof ZK Matthews Hospital; – –Kimberley Hospital; – –Kuruman Hospital – –Postmasburg Hospital The Department of Roads and Public Works serves as the implementing agent on all infrastructure development projects;

.. Financial Information

.. Mental Health Hospital PurposeProvision of Mental Health Services Commencement Date2006 Projected Completion Date2008 Initial Project CostsR290 million Expenditure to dateR360 million Cause of delaySlow delivery by the contractor on site Current StatusMatter with the Court of Law Remedial measuresAppointment of CIDB graded contractors Additional costs to complete project R380 million Total estimated costR740 million

.. Upington Hospital PurposeProvision of Level Two Services Commencement Date2009 Completion Date2012 Initial Project CostsR836 million (construction, organizational development, health technology & quality assurance, excluding escalations) Expenditure to dateR278 million Cause of delayNone Current Status50% Total project costsR836 million

.. De Aar Hospital PurposeProvision of Level Two Services Commencement Date2010 (Phase 1) Completion Date2012 Initial Project CostsR400 million (construction, organizational development, health technology & quality assurance, excluding escalations) Expenditure to dateR25 million (earth works) Causes of DelayChange of services package Current StatusSite establishment for staff accommodation, reservoir & fencing Projected project costsR400 million

.. Prof ZK Matthews PurposeProvision of Level One Services Commencement Date2006 Completion Date2008 (additional work commenced in 2009) Initial Project CostsR80 million Expenditure to date Causes of DelayNone Current Status98% additional work complete Projected project costs

.. Kimberley Hospital PurposeProvision of Tertiary Services Commencement Date2013 Completion Date2018 Initial Project CostsR1,600 billion Expenditure to dateNone Causes of DelayNone Current StatusDevelopment of business case Projected project costsR1,600

.. Kuruman Hospital PurposeProvision of Level Two Services Commencement Date2013 Completion Date2016 Initial Project CostsR900 million Expenditure to dateNone Causes of DelayNone Current StatusDevelopment of business case Projected project costsR900 million

.. Postmasburg Hospital PurposeProvision of Level One Services Commencement Date2011 Completion Date2013 Initial Project CostsR200 million Expenditure to dateR0 Causes of DelayApproval of the business case by the NDoH Current StatusDevelopment of Project Brief Projected project costsR200 million

.. Performance & Monitoring (DoH & Public Works) Each project has the initial Project Implementation Plan to outline the activities and time frames; The project deliverables are measured on quarterly basis; The Project Implementation Plan is developed on annual basis but with quarterly targets for reviews; Monthly financial reports are submitted to NDoH; A representative of PDoH participate in the site meetings; Monthly progress meetings between the implementing agent and the client take place; The National Treasury Infrastructure Reporting Model and In Year Monitoring report are used to monitor expenditure; Reports are also presented to the Project Management Forums.

.. Co-ordination of the HRP Project Prioritisation was done through the Service Transformation Plan The following table presents the HRP projects implementation plan up to 2016/17 financial year:

.. Co-ordination of HRP Project (cont) HOSPITAL REVITALIZATION PROGRAMME 2010 UP TO 2016 BUDGET BID Project2009/ / / / / / / /2017 Barkly West HospitalR 9,000R 1,000R 0 Mental Health FacilityR 155,967R 69,800R 10,000R 0 Upington HospitalR 140,000R 220,000R 240,000R 197,000R 20,000R 0 De Aar HospitalR 18,307R 103,068R 130,000R 120,000R 10,000R 0 Postmasburg HospitalR 6,000R 20,000 R 107,572R 65,436R 0 Kuruman HospitalR 0R 150R 2,500R 0R 140,000R 200,000 R 250,000 Kimberley HospitalR 6,000R 200R 2,392R 1,482R 170,000R 250,000 Hartswater HospitalR 0 R 500R 200R 49,243R 30,379R 15,742 Kakamas HospitalR 0 R 500R 1,500R 47,000R 28,124 Springbok HospitalR 0 R 500R 1,500R 0 Grand ManagementR 5,000R 6,000R 5,500 R 6,000 Total AllocationR 340,274R 420,218R 410,892R 431,754R 461,679R 489,379R 518,742R 549,866

.. Performance of Contractors and Consultants Contractors are unable to meet the monthly deliverables as per their set programmes due to insufficient capacity in their companies; Their respective under- performance subsequently leads to underspending on the project; Poor coordination between the Contractors/Consultants and implementing agent leads to further delays on the project.

.. Capacity to implement the Hospital Revitilisation Programme The Dept of Public Works is responsible for the implementation of the programme; The Department of Health is only responsible for planning(development of business case, project brief and supervision of designs), reporting and monitoring of projects; Due to limited capacity at Public Works, there is no proper monitoring on projects, hence mental health hospital.

Conclusion Projects are planned timeously, with the necessary inputs from all stakeholders;Projects are planned timeously, with the necessary inputs from all stakeholders; Challenges are often experiences, with the service providers either not meeting their deadlines, or not being able to complete the project;Challenges are often experiences, with the service providers either not meeting their deadlines, or not being able to complete the project; Remedial measures include:Remedial measures include:  Termination at the earliest confirmed inability to complete the contract;  Regular monitoring meetings are held, in order to assess progress;  Regular report-backs to management and recommendations on how to prepare for the take-over of the project, once completed;  Ensuring that there is value-for-money is attained. THANK YOU