1. Standing Committee on Appropriations Quarter 3 Expenditure 2012/2013
The Presidency
Department of Performance Monitoring and Evaluation
Standing Committee on Appropriations Quarter 3 Expenditure 2012/2013
26 March 2013

2. AENE Budget for 2012/13 (R’000) Economic classification TOTAL
Programme
Administration
OME
M&E Systems
PSO
Compensation
88 959
23 296
29 142
9 869
26 652
Goods and Services
69 615
23 044
18 643
3 425
24 503
Capital Assets
15 585
13 500
755 75
1 255
59 840
48 540
13 369
52 410
Shifts and virements (post AENE)
TOTAL
Administration
OME
M&E Systems
PSO
Compensation
-3 410
-940
-1 220 -
-1 250
Goods and Services
3 410
940
5 370
-2 900
Capital Assets
700
-700
3 450
-4 150

3. Reasons for budget shifts and virements
All virements were done within the 8% limit for virements in terms of section 43(2) of the PFMA
Savings on compensation due to:
Difficulties in finding suitable candidates for some specialist positions, leading to recruitment processes taking longer than planned
A number of advertised positions were filled by successful internal candidates, resulting in new vacancies
Delay in implementation of Bargaining Council resolution regarding salary levels 9/10 and 11/12, which was budgeted for
Some delays in obtaining pre-employment security screening results, which delayed some of the appointments
Delay in implementation of HoD assessment programme (awaiting issuing of new policy by DPSA)

4. Reasons for budget shifts and virements continued….
Savings from compensation moved to goods and services, largely to fund evaluations in terms of the National Evaluation Plan under the OME branch
Some savings from Presidential Hotline (SITA and call costs lower than expected) moved to goods and services under OME branch, to fund the 20 year review and research on norms and standards for concurrent functions

5. Expenditure overview: monthly expenditure (R’000)
Projected

6. Expenditure overview: overall expenditure for the year

7. Expenditure overview: explanation
Department spent 55.2% of its overall budget by the end of Q3 with another 18.5% spent in January and February 2013
Increase in expenditure towards the end of the financial year largely due to expenditure on IT equipment, evaluations and research projects:
We were required to engage with SITA to plan our IT infrastructure requirements. These engagements were only finalised in June 2012 and the procurement of IT equipment could only start after that. This explains why our IT expenditure largely took place towards the end of the financial year
Evaluation programme is still relatively new - National Evaluation Policy Framework was approved in November 2011 and the 2012/13 national evaluation plan was only approved in June 2012 – this explains why expenditure on evaluations largely took place at the end of the financial year
The 2013/14 evaluation plan was approved in November 2012 and preparations are already under way for implementation. Therefore expenditure on evaluations will be more evenly spread over the 2013/14 financial year

8. Expenditure overview: explanation continued…
DPME was requested to carry out 20 year review and norms and standards research project after the beginning of the financial year, and expenditure on these two projects has therefore largely taken place towards the end of the financial year
Based on current expenditure and projections, the Department will spend approximately 90.7% of its overall budget for 2012/13. The 9.3% shortfall in expenditure is broken down as follows:
5.8% (R10.1m) contractually committed (orders issued but goods or services not yet received). Payments delayed due to projects starting late in the financial year (e.g. 20 year review, norms and standards, evaluations) and delays in delivery of ICT equipment
1.8% (R3.1m) savings due to projects costing less than expected – some ICT projects and some of the evaluations
1.6% (R2.8m) in under-expenditure, mostly due to under-expenditure on compensation (reasons provided earlier)

9. Filling of posts (197 funded for the 2012/13 financial year)

10. Filling of posts continued….
137 Posts filled (against 195 funded posts) by 31 March 2012
Department created new posts in July 2012 to provide additional capacity for Local Government Performance Monitoring while other posts were unfunded. Total number of funded posts increased to 197
173 posts filled by March 2013 (24 funded vacancies remaining), with 5 new employees due to start in April 2013
All remaining vacant funded posts have been advertised and are in the process of being filled

11. Goods and Services

12. Goods and Services Hotline expenditure:
Hotline transferred to DPME from Presidency on 1 October 2011
For 2012/13 budget DPME requested additional funding for Hotline for additional call centre capacity, increased services from SITA and for calls made to toll-free number
Additional call centre capacity was been put in place during 2012 and additional services are being provided by SITA
Request for additional funding for 2012/13 was based on estimate from SITA and estimate of cost of toll-free number (at time of transfer, telecoms operators had not yet invoiced for toll-free number)
Actual SITA costs for increased call centre operators and increased services, and actual toll-free number costs have turned out lower than estimated (resulting in saving of R2.9 million against budget)

13. Goods and Services (continued)
DPME will request rollovers for two projects which it was requested to implement after the start of the financial year:
20-year review
R1.2 million has been spent on 37 research assignments to date, and a request will be made to roll over R2.2 million out of a total budget of R3.4 million
Research on national and provincial minimum norms and standards for concurrent functions
A tender was awarded in February 2013 and a request will be made for R3.6m of the R4.6m budget for this project to be rolled over

14. Capital Expenditure

15. Capital Expenditure
DPME ICT infrastructure plan agreed with SITA in June 2012
Procurement of hardware only started in July 2012
Implementation of ICT plan on track for completion by March 2013
R4.3m unspent on ICT projects due to:
R3.6m in orders placed - delays in delivery of equipment
R0.7m due to delays in finalisation of PoA, MPAT and FSD systems
R1.3m in savings on ICT project – equipment costing less than expected

16. Conclusions DPME is a relatively new department
New units have no historical expenditure data and tend to over-estimate when budgeting
Approvals for evaluation programme only obtained after start of financial year
DPME has now settled into multi-year budgeting and expenditure with planning and preparations taking place the year before expenditure takes place
It is now possible to start evaluation and research projects early in the financial year, which will ensure a more even spread of expenditure
Corrective measures introduced to address under-expenditure:
For the budget for the 2013/14 financial year, the CFO has played a more direct role in engaging with programme managers to ensure that budgets are realistic
The Department has also introduced monthly budget and expenditure meetings to ensure more accurate budgeting and more rigorous expenditure monitoring in future
Therefore from 2013/14 we expect that DPME expenditure will be more evenly spread over the financial year and that expenditure will be within 2% of budget

17. THANK YOU!