1. 1 NCOP SELECT COMMITTEE ON FINANCE MEETING 6 FEBRUARY 2007

2. OVERVIEW The objective is to report in terms of Section 32 of the PFMA 2007/08 expenditure as at 31 December 2007 Conditional Grants Spending Capital expenditure Progress with the implementation of infrastructure projects Achievements, Challenges and Remedial Measures Monitoring arrangements within FSDoE 2

3. EXPENDITURE PER PROGRAMME AS AT 31 DECEMBER 2007 3 ProgrammeBudget R ' 000 Compen- sation R ' 000 Goods and Services R ' 000 Transfers R ' 000 Capital R ' 000 Total Expense R ' 000 Balance R ' 000 % Actual Spending Programme 1: Administration 457,324219,650100,5843,7556,857330,846119,07772.35% Programme 2: Public ordinary Schools 4,339,7172,896,33191,685264,2207,4363,259,6721,138,51575.12% Programme 3: Independent Schools 35,6840026,3850 9,29973.94% Programme 4: Special Schools 179,345110,5222,29123,013119135,94543,40075.80% Programme 5: FET Colleges 187,93879,40915957,9880137,55650,38273.19% Programme 6: ABET69,12241,9406,2366810448,34820,77469.95% Programme 7: ECD58,0389,5241,09125,462036,07720,26162.16% Programme 8: Auxiliary & Assoc. Serv. 390,8614,484126,82336,997153,289321,59335,89782.28% Totals5,718,0293,361,860328,869437,888167,8054,296,4221,422,12075.14% Percentage spending excludes commitments in all instances

4. 4 OVERVIEW OF UNDERSPENDING PER PROGRAMME Programme1: Administration ICT equipment(R36 million): Procurement has started and roll-out will commence from Nov 2007 Programme 2: Public Ordinary Schools Non Section 21 LTSM in Districts. Delivery of Stationery to date 98%, all distributed to schools. Textbooks delivery is 82%. Awaiting backorders from Publishers. Programme 5: FET colleges Compensation of employees: Outstanding claims for part-time educators and the implications of the FET Act Programme 6: ABET The amount of R4,9million on goods and services will be used to conduct training on new unit standards and site based assessment tasks in February 2008 Programme 7: ECD Compensation of employees Transfers to centres delayed due to non-compliance Programme 8: Auxiliary and Associated Services Payment for capital projects is according to schedule and no overspending is envisaged.

5. EXPENDITURE BY ECONOMIC CLASSIFICATION 31 DECEMBER 2007 5 Households includes bursaries paid to learners at tertiary institutions including leave gratuities. Bursaries are paid in Jan-Feb 2008 while gratuities are paid through the financial year

6. CONDITIONAL GRANTS SPENDING AS AT 31 DECEMBER 2007 6 R36, 574 million = transferred to the Colleges NSNP will be supplemented by R1,2million from the equitable share to cover for the increased number of ALL primary school learners fed. Conditional GrantBudget R’000 December 2007 Expenditure R’000 Commitment R’000 Balance R’000 % Actual Spending 3 rd Quarter HIV/AIDS9,2177,4441,51425980.76% National School Nutrition Programme68,02367,33623645198.99% Provincial Infrastructure grant119,723100,0298,68211,01283.55% Infrastructure Enhancement80,72562,73912,9994,98777.72% FET Colleges Recapitalisation36,574 00100.00% Totals314,262277,82823,43113,00388.41%

7. 7 ACTUAL SPENDING BY FET COLLEGES ON RECAP GRANT AS AT 31 DECEMBER 2007 Taking into consideration commitments of R5million,expenditure will improve to 75,3%.Commitments are largely for buying/building of new classroooms,laboratories,offices etc FET CollegesTotal Allocation R ' 000 Transfers R ' 000 December 2007 Expenditur e R ' 000 Commitment s R,000 Balance R ' 000 %Actual Spending 3 rd Quarter Flavius Mareka7,000 5,183889,7001,81774.04% Goldfields11,000 5,8843,711,5565,11653.49% Maluti7,000 4,634759,6642,36666.20% Motheo11,000 5,614444,0585,38651.04% Totals36,000 21,3155,804,97014,68559.21%

8. 8 LIFE SKILLS AND HIV / AIDS: PERFORMANCE MEASURES ActivityDetails of trainingTargetActual Advocacy Orientation meetings for parents 5559 Training - Master Trainers Life skills, HIV and AIDS, Peer education programme,Teenage pregnancy and prevention programme 490 Training – Educators Roll out of cross circular integration in schools,EMGD training of SMT,s 1,8642,977 Care and Support Basic counseling skills, Substance abuse, Care and support 365550 Peer Education Peer education programme 440

9. LIFE SKILLS AND HIV / AIDS 9 CHALLENGES The contractual Administrative assistant as well as the contractual data capturer accepted permanent positions at the UFS and DoE respectively. Additional personnel needed to assist with the increasing volume of work.

10. NATIONAL SCHOOL NUTRITION PROGRAMME PERFORMANCE MEASURES SCHOOL FEEDINGSUSTAINABLE FOOD PRODUCTION IN SCHOOLS NUTRITION EDUCATION 413 546 learners were fed during the second and third quarter for all school days Voluntary food handlers are given stipend of R500 each per month Schools are given R300 per month for gas / fuel There are 637 schools with existing vegetable gardens Each District has 20 schools participating in Nutrition Education Training on personal hygiene completed in all districts 10

11. NATIONAL SCHOOL NUTRITION PROGRAMME CHALLENGES Introduction of feeding in the registered ECD community based sites Lack of proper food storage and preparation areas in schools The Department has identified 80 schools in the Province for provision of mobile kitchens. Improvement in monitoring 11

12. 12 ACHIEVEMENTS: FET RECAPITALIZATION GRANT 1.RESKILLING STAFF TO OFFER RESPONSIVE PROGRAMMES  382 FET Staff received training according to identified needs to ensure effective teaching and learning as well as managing the implementation of the National Curriculum (vocational) [NC(v)] programmes. 2.UPGRADING PHYSICAL INFRASTRUCTURE OF FET COLLEGES Colleges utilised funds to complete the following projects:  1 Student Support Centre was built and completed at Goldfields College.  5 Workshops, classrooms, laboratories and offices as per identified needs were upgraded at the four FET colleges.  2 Campus sites were upgraded at Motheo and Maluti Colleges.  Equipment was purchased to support teaching and learning of NC(v) levels 2 and 3 programmes.  LTSM were purchased for NC(v) levels 2 and 3 programmes to ensure effective and efficient training.  Security and control systems have been installed at all four FET Colleges - boom gates, asset registers, Coltech for learner registration and keeping of financial records, etc. 3.CONNECTIVITY TO IMPROVE COMMUNICATION, INFORMATION MANAGEMENT AND CURRICULUM DELIVERY  All the campuses of Flavius Mareka, Goldfields and Motheo FET Colleges are connected with their respective Central Offices through a Management Information System, electronically.

13. 13 OVERALL ACHIEVEMENTS: FET RECAPITALIZATION GRANT Several monitoring visits were conducted by DoE and the FSDoE in order to ensure compliance to financial management as well as the management of the Recapitalization Conditional Grant at FET Colleges. DoE and FSDoE visited FET Colleges on a regular basis to assist and ensure implementation of management systems (e.g. Financial Management, Asset Management, Supply Chain Management and Recap Management Systems)

14. 14 FET RECAPITALIZATION CHALLENGES  Problems with contractors: – Do not keep to specifications in Service Level Agreements – Fall behind schedule – Not sufficient response from competent contractors to tender – Building material not delivered on time (especially steel constructions)

15. INFRASTRUCTURE PROGRAMMES The Capital Infrastructure Programme consist of the following: – Major Capital implemented by Public Works with a focus on elimination of platooning and overcrowding. (Platooning will be eliminated in the next two financial years) – The Minor Capital projects implemented by the Department of education in collaboration with SGB’s targets renovations, maintenance and the provisioning of basic services like water, sanitation and electrification. (Agreements with DWAF and ESKOM are in place to assist with implementation) 15

16. SPENDING ON INFRASTRUCTURE 16

17. INFRASTRUCTURE EXPENDITURE End of Third Quarter expenditure – 82% vs second quarter – 44% The expenditure has increased due to the fact that most contractors were performing according to expectations. The 100% mark is expected to be reached by end February 2008. Regular monthly monitoring meetings between Implementing Agency and Client. Monthly reports are supplied and discussed Intensive quarterly reviews led by Provincial Treasury assists in briefing the Executing Authorities in the province 17

18. Monitoring capacity in the Department Monthly Finance Committee meetings are held to discuss underspending and remedial actions Quarterly review sessions are held to provide feedback on service delivery and the budget. Monthly expenditure reports are sent for the attention and the comment of the HOD and the Executive authority. Each branch is allocated a management accountant to assist with all financial related queries including budget management Letters are written to managers who underspent to inform them of the status quo and the implications of their underspending. Where underspending persist affected manager are brought before the executive leadership and the MEC to account for their actions. Where managers are not able to spent despite all the interventions funds are diverted and spent in line with objectives of the department.

19. THANK YOU 19