1. PRESENTATION TO THE SELECT COMMITTEE ON APPROPRIATIONS (SCOA) ON DEVOLUTION OF PROPERTY RATE FUNDS GRANT
MAY 2010
MEC ROBIN CARLISLE

2. To inform SCOA on: PURPOSE Data trends Capacity
Under-spending on Property Rates
Reporting

3. BACKGROUND
PGWC took responsibility for payment of Municipal Property Rates accounts as from 01 April 2008.
This function previously vested with the National Department of Public Works.
During 2008/09 a total of 1881 accounts payable to the value of R were received from municipalities, but only R (Budget of R ) was paid resulting in a shortfall of R 3

4. DATA TRENDS 08/09 09/10 R’000 Budget: Main 147 127 164 865
Adjustment: 2008/09 Shortfall
2009/10 Shortfall
37 563
66 403
Payable:
Paid
Accrued
37 598
6 500
(Shortfall) / Surplus
(37 563)
12 046
The Property Rates Grant is in its 3rd year of Implementation and the data trends will be developed over time.
PGWC is currently in the process of acquiring additional sites for health and educational purposes which will result in additional property rates expenditure.

5. Check and verify correctness of payments.
CAPACITY
OFFICIALS
LEVEL
FUNCTIONS PERFORMED
Manager 12
Budget and Personnel Matters
Financial and other reports
High level enquiries (MEC, AG, PT, etc)
Strategic Interventions with municipalities and other stakeholders.
1 x Verifier
Contract (PSA)
Check and verify correctness of payments.
Verify and certify payments on system
Collate and verify production and other statistical detail
4 x Administrative Officials
1x Permanent staff
3 x Contract (PSA)
Process monthly payments i.r.o property rates accounts on iE-Works
No funding was transferred to create the additional administrative capacity to manage the devolved property rates payments. Currently the function is performed by 2 permanent staff members and 4 contract personnel. 5

6. UNDER-SPENDING Root cause Risks Mitigating
Late submission of accounts from CoCT due to process of splitting rates and utility accounts
Late payments of accounts, accrual of interest and potential under spending
Additional hours work to avert potential late payments and under spending. Monthly meetings with CoCT on outstanding accounts.
2009/10 accounts received after financial closure.
Potential under spending, and under provision for 2010/11 allocation.
Regular follow-up procedures with municipalities on outstanding accounts. Liaise timeously with PT and NDPW on potential allocation shortfall
Delays in finalisation of transfer of new sites for Education and Health purposes.
Timely follow-up with various role-players to ascertain status of transfer.