1. Presentation to the Portfolio Committee on NCC
Date : 2 November 2011
Presented by: Director-General
Mr Lionel October

2. Regulatory Framework
The National Consumer Commission (NCC) is established in terms of section 85 of the Consumer Protection Act No. 68 of 2008 and reports to the Executive Authority of the dti
Funding allocation for the operations of the institution is done through the MTEF process in terms of the guidelines issued by National Treasury during July/August each year
In year requests can be made for unforeseeable and unavoidable expenditure during the Adjustment Estimates process
Funds can only be transferred to an institution provided that section 38(1)(j) requirements are met, which requires that “before transferring any funds to an entity within or outside government, must obtain written assurance from the entity that that entity implements effective, efficient and transparent financial management and internal control systems”
Funds are transferred to institutions in tranches based on cash flow projections

3. MTEF funding allocation for the NCC
During the 2010/11 MTEF, funding allocated to the NCC was as follows:
R19,792 million transferred to the NCC in September 2011
the dti processed all orders and payments to 30 September 2011
NCC took over administration of payments from 1 October 2011
In addition, an amount of R16,1 million was allocated from Sector Wide Enterprise Employment and Equity Programme Sector (SWEEEP) - EU donor funding, which was to be utilised for set up costs of the institution (i.e. 1 year rental; equipment and awareness campaigns)
2011/12
R’000
2012/13
2013/14
32,988
41,577
43,864

4. Expenditure and forecasts – 1 April 2011 to 30 September 2011
The following expenditure and forecast was submitted by the NCC as at 30 September 2011
Description of item
Year to Date Budget
YTD Actual Expenditure
YTD Variance
Annual budget
Year-end Forecast
INCOME
Departmental Transfers
19,792,000.00 -
32,988,000.00
Interest Income
34,256.76
(34,256.76)
TOTAL INCOME
19,826,256.76
33,022,256.76
OPERATIONAL COSTS
16,450,000.00
10,964,224.32
5,485,775.68
27,414,224.32
Compensation of Employees
12,465,968.00
9,016,464.40
3,449,503.60
24,931,936.00
21,482,432.40
Other Operating Expenditure
3,984,032.00
1,947,759.92
2,036,272.08
8,056,064.00
5,931,791.92
Surplus/(deficit) for the period
3,342,000.00
8,862,032.44
(5,520,032.44)
5,608,032.44
YTD expenditure to 30 September 2011 was R10,964 million
Institution projects annual expenditure to be R27,4 million, resulting in a surplus of
R5,6 million

5. Sector Wide Enterprise Employment and Equity Programme (SWEEEP)
SWEEEP is donor funding received from the European Union for utilisation of expenditure for enterprise, employment and equity
The SWEEEP funds are located at the dti
Funding for specific projects are motivated to and approved by the Executive Board of the dti
Payments are made on the basis of expenditure being incurred
Allocated
R’000
Expenditure
Available
16,100
6,901
9,199

6. Funds available 1 October 2011 to 31 March 2012
Description
Allocation
R’000
Expenditure to 30 September 2011
Available
Departmental allocation
32,988
10,964
22,024
SWEEEP
16,100
6,901
9,199
Total
49,088
17,865
31,223

7. Status of the NCC budget submission to Portfolio Committee
the dti has reviewed budget submission to the Portfolio Committee and agreed with the CFO of NCC that it should be revised based on the following guidelines:
Certain items appear to be duplicated, e.g. R1 million reflected under capital for computers and R800 thousand under operating for leasing of computer
Expenditure items seem to be overstated, e.g. expenditure for printing and stationery for the 1st 6 months was R15 thousand per month and the projections for the remainder of the financial year reflect R120 thousand per month
Motivations together with assumptions on the proposed budget
Capacity to spend

8. THANK YOU