1. Department of Environmental Affairs Overview of mandate, functions, concepts and financial environment ….Ms N Ngcaba

2. Department of Environmental Affairs Foundational Mandate = Sustainable Development Constitutional mandate (Sec 24) – 3 SD elements: Social - environment – not harmful to health or well- being; “…while promoting justifiable … social development. Environmental – protect the environment, for the benefit of present and future generations, through legislative / other measures that - –prevent pollution and ecological degradation; –promote conservation; and Economic – secure ecologically sustainable development and use of natural resources while promoting justifiable economic … development.”

3. Environmental Affairs Mandate Environmental Quality and Protection: –impact management, –Pollution and waste management, –air and atmospheric quality, –Climate Change –Meteorological and related Services. Biodiversity and Conservation: –Conservation of land and sea scapes –Protected areas –Biodiversity management Marine and coastal management –Marine resource management –Monitoring control & surveillence –research

4. Environmental Impact Assessment (EIA) – An assessment of suitability of a development project in a particular natural environment. Record of decision (RoD) – Certification of approval of a development by an approval authority (Minister) with/without condition. Impact Management:- Prevent and manage potentially negative development impact on the environment through amongst others:- Development and implementation of policy and legislative framework for environmental impact management, Processing of Environmental Impact Assessments (EIA’s), Building environmental impact management capacity, Ensure compliance to conditions of EIA records of decisions (RoD) and prevent unauthorized development (role of Environmental Management Inspectorate or “green scorpion” – the environmental police). Environmental Quality and Protection

5. Environmental Quality Management Pollution and Waste Management: Development and implementation of policy, legislation, norms and standards for pollution and waste management, Promote reduction, reuse and recycling (through Buyisa-e-bag) of waste Processing of applications for development of waste management infrastructure (this is now linked to impact management processes to avoid duplication), Develop capacity for pollution and waste management, Promote the implementation of polluter pays principle Pollution – contamination of an environment (land, water and air) – e.g. use of pesticides, mine waste, Waste – by product of consumption process that may no longer be used in the same production chain. Reduce, reuse and recycle … are commonly applied global principles on waste management – cradle to grave,

6. Environmental QualityManagement Air and atmospheric quality: Improve state of ambient air quality: Development and implementation of policy, legislation, norms and standards for air quality; Ambient Air quality management capacity development, Monitoring of ambient air quality and monitoring infrastructure development support, Ozone layer protection, Ensure adherence to ambient air quality standards. Ambient Air quality – Air above the earth surface meeting specified standards/not polluted (by gases emitted from industrial or household processes beyond certain limits) Ozone layer - is a layer of gas in the upper atmosphere which protects humans and other living things from the harmful ultraviolet (UV-B) rays of the sun.

7. Environmental Quality and protection Climate Change Climate change mitigation and adaptation policy development and research coordination. Climate Change – refers to a long-term change in weather patterns over durations of time ranging from decades to millions of years due to increases in concentrations of greenhouse gases, etc. Mitigations – To take action that will reduce greenhouse gas emissions in the atmosphere, acidification of the oceans resulting in sea-level rise phenomenon, etc Adaptation – finding ways to be able to survive the occurrence of natural disasters linked to variations in climatic conditions

8. Meteorological and related Services (South African Weather Services - SAWS): Timely dissemination of the weather forecast information – linked to prevention of natural disasters and also to allow for long and short term planning (e.g. agriculture and aviation safety), Ensure accuracy of the weather forecast information, Ensure good state of weather forecasting infrastructure (radars, lighting detectors, software etc), maintanance Meteorological – relates to the study of the changes in temperature, air pressure, moisture, and wind direction in the atmosphere. Aviation - refers to activities involving man-made flying devices (aircraft)

9. Biodiversity and Conservation Promote conservation and sustainable utilization of natural resources:- Conservation of land and sea scapes: Declaration of National terrestrial and marine protected areas to conserve ecosystems, Protected areas: Management of National protected areas through South African National Parks – SANParks and iSimangaliso Wetland Park Authority) – 23 National Parks and iSimangaliso Wetland Park (1 st World Heritage Site in South Africa), Biodiversity management: Mitigation of threats to biodiversity, Build a sound scientific base for effective management of natural resources in partnership with South African Biodiversity Institute (SANBI) which also manages botanical gardens (9 gardens)., incl a network of scientific authorities falling under DST, (CSIR, NRF, Universities, etc) Biodiversity – describes the variety of life in an area, including the number of different species, the genetic wealth within each species,...plant life, animal life, ocean life,… Conservation – protection and preservation of the ecological resources for future generations Terrestrial – in land Marine – in ocean

10. Marine and Coastal Management – Marine living Resources Fund (MLRF) Promote conservation and sustainable utilization of marine and coastal resources:- –Allocation of fishing rights, –Marine research to ensure resources sustainability, –Prevention of illegal access to resources, –Maintain good quality of marine and coastal environment.(preventing pollution of ocean environment)

11. FINANCES

12. Topics For Discussion State of budgeting environment per MTEF guidelines Strategic Risks identified per MTEF Review of baseline adjustments Prior years & MTEF Expenditure trends Projected own Revenue generation & constraints Challenges identified in MTEF allocations and projected budget constraints Transfers to Public Entities & Audit Opinions

13. State of Budgeting Environment Global recession and weaker economic conditions Required responses per National Treasury Guide. Rigorous baseline assessment Detailed costing of policy proposals at activity level Value for money assessment Reprioritisation and Alternative funding mechanisms for infrastructure project e.g. Public Private Partnership (PPP) Scenario and risk analysis Coordinated planning with public entities Implementation readiness Identification of new outputs and development of Monitoring & Evaluations plans.

14. Strategic Risks Identified Contributory Factor/s Risk Description Shrinking Purse & Global recession -Anticipated further Financial constraints -Reduction of MTEF allocations by National Treasury -Possible decrease in Donor Funds -Insufficient funding of establishment Restructuring and split Possible In-Equitable allocation of resources

15. Review of Baseline Allocation Trends 2009/10 ‘000 2010/11 ‘000 2011/12 ‘000 Baseline 3 446 8603 762 6733 614 173 Requested 450 195 621 0001 042 000 Initial allocation 68 340 164 393 581 932 Total allocated 3 515 2003 927 0664 196 105 Further cuts Jan 09 ( 34 417) (42 990) (48 641) Final allocation 3 480 7833 884 0764 147 464 % Baseline Increase.01% 3.2% 14.8%

16. Prior Years Expenditure Patterns ProgrammeAudited Outcome (Unqualified) 2006/2007 R’000 2007/2008 R’000 2008/2009 R’000 1. Administration167 276193 120204 358 2. Environmental Quality and Protection 199 232241 503253 508 3. Marine and Coastal Management 324 048349 298434 325 4. Tourism547 248612 477693 229 5. Biodiversity and Conservation 279 579359 833399 309 6. Sector Services and International Relations 542 2811 032 5261 214 149 Total 2 059 6642 788 7573 198 878 An average annual spend of 99.8% was achieved

17. Economic Classification- MTEF Trends Economical ClassificationAudited Financial year05/06 R’000 06/07 R’000 07/08 R’000 08/09 R’000 Compensation of Employees209 664262 506342 195396 747 Goods and Services302 077281 296321 723357 014 Transfers: Departmental Agencies and Accounts 806 5581 042 1761 373 7011 567 304 Transfers: Foreign Governments6 00012 42109 000 Transfers: Non Profit Organisations 12 59544 78288 152100 906 Transfers: Households382 656406 584652 638759 488 Capital Assets56 1369 89910 3488 419 Total1 775 6862 059 6642 788 7573 198 878

18. Economic Classification- MTEF Trends Economical ClassificationMedium Term Expenditure Estimate Financial year2009/2010 R’000 2010/2011 R’000 2011/2012 R’000 2012/2013 R’000 Compensation of Employees432 810477 047514 448540 170 Goods and Services383 152439 712525 919553 674 Transfers: Departmental Agencies and Accounts 1 638 4481 538 8091 610 7461 691 283 Transfers: Foreign Governments9 000 Transfers: Non Profit Organisations 90 97164 87444 87446 068 Transfers: Households767 647871 746924 051970 305 Capital Assets158 755482 888518 426535 421 Total3 480 7833 884 0764 147 4644 345 921

19. Donor Funds Trends Donor/ProjectAudited Outcome (Unqualified) Programmes & Projects 2005/2006 R’000 2006/2007 R’000 2007/2008 R’000 2008/2009 R’000 Norway: Environmental Cooperation --6 64911 151 Norway: Marine Fisheries Cooperation -7 65114 71015 447 Denmark: Air Quality Management 236439663306 Denmark: Urban Environmental Programme ---6 627 Denmark: Environmental Capacity Building 3 5991 2372 745133 Denmark: National Waste Management 7 95510 0001 300134 World Bank: African Stockpile --3 183 Total 11 79019 32726 06736 981

20. Donor Funds Trends Donor/ProjectMedium Term Expenditure Estimate Programmes & Projects2009/2010 R’000 2010/2011 R’000 2011/2012 R’000 2012/2013 R’000 Norway: Environmental Cooperation12 62510 9176 097 - Norway: Marine Fisheries Cooperation 8 8347 821- - Denmark: Air Quality Management630-- - Denmark: Urban Environmental Programme 2 1563 3854 3262 784 Denmark: Environmental Capacity Building ---- Denmark: National Waste Management ---- World Bank: African Stockpile7381 5762 7541 563 Total24 98323 69913 1774 347

21. Challenges Identified ChallengeImplications 99.8 % expenditure trends Possible future decline in donor funds (from R37 million 2008/9 to R4 million 2012/13) Lean margin of safety - for commitments, accruals including unforeseeable & unavoidable expenses Future Pressure on MTEF, negative impact on service delivery including delays in projects. Avoidance of unauthorised expenditure-reduced Operational and Capital expenditure (OPex & CAPex ) plans – Strategic expenditure (Stratex) implications Continuous reprioritisation & budget trade offs, & rationalisation – with possible audit implications Less flexibility in funding for multi year projects and contracts. Funding of new programs, projects, structure changes Possible establishment short funding, & increase in vacancy rate -capacity constraints Internal & external co- ordination of projects Specialized service delivery consultants - possible budget shortfalls Audit opinion integrityPossible Audit Exposures in the 99.8% expenditure trends and Performance Audit Exposure

22. Expenditure Trends over the MTEF period 0 500 000 1 000 000 1 500 000 2 000 000 2 500 000 3 000 000 3 500 000 4 000 000 4 500 000 5 000 000 2005/062006/072007/082008/092009/102010/112011/122012/13 Years R'000

23. Increase in Expenditure Trends – overall Department Average Percentage increase of 21,8% - ( from R1,8 billion to R3,2 billion) years 2005/6-2008/9 Infrastructure Development in: National Parks, Botanical Gardens, Weather Service, replacement of the supply and research vessels for the Antarctica and the Marion and Gough islands. Poverty relief projects Increase in Environment, Conservation & Marine mandates Transfers and subsidies to departmental agencies Increases to the baseline accounts for the following: - Establishment increase, operations, and accommodation, Inflation adjustments, baseline adjustments, Climate Change research, policy development and implementation and Buyisa-e-Bag (S21 implementing plastic bag regulations)

24. Programme 2: Air Quality & Protection Expenditure increase from R185,287 million in 2005/2006 to R363,395 million in 2012/2013 Programme expanded from a regulatory phase to an implementation phase which includes the following: Regulatory Services Pollution and Waste Management Environmental Impact Management Air Quality Management and Climate Change Increase in Expenditure Trends per Programme continued:

25. Expenditure Trends continued: Programme 3 Marine & Coastal Management Increase from R262,428 million in 2005/2006 to R1 027,982 million in 2012/2013 Increase due to provision for the replacement of the polar vessel which will commence during the 2009/10 financial year Programme 5: Biodiversity and Conservation Increase from R283,195 million in 2005/2006 to R487,137 million in 2012/2013 for establishment of the Transfontier (“boundless” protected areas) conservation initiative Transfer Payments to the following Public Entities: South African National Parks, South African National Biodiversity Institute and iSimangaliso Wetland Park Authority Programme 6: Sector Services & International Relations Expenditure increase from R473,321 million in 2005/2006 to R1 345,701 million in 2012/2013 for Poverty relief programmes linked to Expanded Public Works Programme (EPWP) and Infrastructure Programme.

26. Transfers: Public Entities & Audit Opinions Public EntityAudited Outcome (Unqualified) (Qualified) 2005/2006 R’000 2006/2007 R’000 2007/2008 R’000 2008/2009 R’000 South African Weather Service 103 690114 393180 112159 916 South African Tourism 362 733465 187517 556588 135 Marine Living Resources Fund 93 322163 057147 812195 351 South African National Parks 143 833187 440364 356434 869 South African National Biodiversity Institute 90 36994 972123 196138 831 iSimangaliso Wetland Park Authority 12 11116 62739 16948 701 Total 806 0581 041 6761 372 2011 565 803

27. Transfers: Public Entities & Audit Opinions Public EntityMedium Term Expenditure Estimate 2009/2010 R’000 2010/2011 R’000 2011/2012 R’000 2012/2013 R’000 South African Weather Service 185 744230 691148 571145 287 South African Tourism 655 669685 519729 750766 238 Marine Living Resources Fund 205 005210 244218 306229 222 South African National Parks 391 231213 973286 970300 469 South African National Biodiversity Institute 145 824150 577158 432163 854 iSimangaliso Wetland Park Authority 50 73644 36564 34767 314 Total 1 634 2091 535 3691 606 3761 672 384

28. Way forward including risk mitigation Continued anticipation of possible short funding in outer years Application of efficiency models across all expenditure items. Re-statement or re- costing of baseline Targeting costs that carry thru MTEF for efficiency models e.g. short term contracts, projects, maintenance costs etc. Alternate Funding Initiatives & Increase in Revenue Exploring more co-funding mechanisms for external projects- where possible. Timing of Infrastructure and Capital Projects Expenditure:- Providing for possible cost increases in existing project costs for the current year. Consider delaying new projects -in the absence implementation readiness and budget. Maintaining clean audits (Financial & Performance) Avoiding of unauthorised expenditure or budget overrun thru more tightening of budget management and due consideration for inflationary costs. Maintaining the balance between MTEF, Strategic Plan deliverables for the performance audit opinion due in (2010).

29. THANK YOU