Feedback on road budgets

RPF November 2001

ContentsBackgroundProcess Information requested Information obtained IssuesCurrent dataRoad forward

BackgroundResolution at RPF May 2001

Data on budgets be adopted as basis and be expanded for future reports

Funded by Gautrans, Sabita and C&CIFocused on provincial and national data

in this presentation

Aims of the projectProvide information on:

Budgets Selected infrastructure management

aspects Southern African road authorities Actions taken by road authorities Performance against budgets.

Process followedContacted road authorities – chief

engineers etcSlow response – regular

communicationsOther sources identifiedAttempted to paint full pictureVerified with different sources

Responses Positive responses re participation from

9 provinces NRA 5/6 metros 2/5 toll concessionaires

Data for 8 provinces / NPRA NRA 2 metros 1 toll concessionaire SADC – appears positive – needs overall approval

Information required Total budgets for department Total road authority budgets Breakdown of road budgets Budgets for specific items (i.e. bitumen and

cement) Grants and transfers and non-treasury expenditure Audited figures previous years Changes to budgets Quarterly performance against budget Construction and rehabilitation programmes

Information obtained Sources

Contacts in authorities Budget speeches Web-published data Auditor-General reports Treasury reports

Problems encountered Response time Manpower

Validity of data – only Auditor-General figures are final

Issues Manpower – skills match problem PFMA (Public Finance Management Act) – public information

More effective and efficient delivery, better value for money, improved public services

Develop capacity 2001/2002 Internal control and audit units

Departmental structures Availability of information

Budget and management systems Progress against budget

Discrepancies in road network lengths and budget figures from different sources

Example of contracts management – spreadsheet

PERFORMANCE AGAINST BUDGET(ACTUAL CONSTRUCTION AND MAINTENANCE DATA FROM A PROVINCE)

0.00

50 000 000.00

100 000 000.00

150 000 000.00

200 000 000.00

250 000 000.00

300 000 000.00

APRIL MAY JUNE JULY AUGUST SEPT OCT NOV DEC JAN FEB MARCH

R

ACTUAL CURRENT ESTIMATE ORIGINAL ESTIMATE

BUDGET

LINEAR (ACTUAL)

Backlog cost estimates

0

200000

400000

600000

800000

1000000

1200000

1400000

1600000

1800000

Rehabilitation Reseal / fogspray

Paved roadsType of backlog

Co

st p

er k

m

Backlog issuesEstimated at R 23 billionBasis for calculation of backlog in

network Target level of service Target network profiles

Aspects included in backlog workNeed similar foundations for estimates

to be credible

Current informationBudgetsProgress against budgetsLonger term budget trendsAuditsGrantsPlanned expenditureRoad networks

“Transport” Department Budgets

Transport Budget allocations 2001/2002

R 0

R 200 000 000

R 400 000 000

R 600 000 000

R 800 000 000

R 1 000 000 000

R 1 200 000 000

Easte

rn C

ape

Free

State

Gaute

ng

KwaZulu

-Nat

al

Mpu

mal

anga

North

ern

Cape

North

ern

Provin

ce

North

Wes

t

Wes

tern

Cap

e

SANRAL

“Roads” section budgets – 2001/2002

R 0

R 100 000 000

R 200 000 000

R 300 000 000

R 400 000 000

R 500 000 000

R 600 000 000

R 700 000 000

R 800 000 000

R 900 000 000

R 1 000 000 000

Easte

rn C

ape

Free

State

Gaute

ng

KwaZulu

-Nat

al

Mpu

mal

anga

Norther

n Cap

e

Norther

n Pro

vince

North W

est

Wes

tern

Cap

e

SANRAL

Bu

dg

et

[R]

?

Transport and Roads % of Provincial Budgets

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

Ea

ste

rn C

ap

e

Fre

e S

tate

Ga

ute

ng

Kw

aZ

ulu

-Na

tal

Mp

um

ala

ng

a

No

rth

ern

Ca

pe

No

rth

ern

Pro

vin

ce

No

rth

We

st

We

ste

rn C

ap

e

Transport % Roads %

?

Progress against budgets - departmental

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

Ea

ste

rn C

ap

e

Fre

e S

tate

Ga

ute

ng

Kw

aZ

ulu

-Na

tal

Mp

um

ala

ng

a

No

rth

ern

Ca

pe

No

rth

ern

Pro

vin

ce

No

rth

We

st

We

ste

rn C

ap

e

Province

Pe

rce

nta

ge

pro

gre

ss

ag

ain

st

tota

l bu

dg

et

[%]

First quarter (June 2001) Second quarter (September 2001)

Progress against budgets (capital) - departmental

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

Ea

ste

rn C

ap

e

Fre

e S

tate

Ga

ute

ng

Kw

aZ

ulu

-Na

tal

Mp

um

ala

ng

a

No

rth

ern

Ca

pe

No

rth

ern

Pro

vin

ce

No

rth

We

st

We

ste

rn C

ap

e

Province

Ca

pit

al p

rog

res

s a

ga

ins

t b

ud

ge

t [%

]

Capital budget First quarter (June 2001) Capital budget Second quarter (September 2001)

Progress against budgets (current) - departmental

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

Ea

ste

rn C

ap

e

Fre

e S

tate

Ga

ute

ng

Kw

aZ

ulu

-Na

tal

Mp

um

ala

ng

a

No

rth

ern

Ca

pe

No

rth

ern

Pro

vin

ce

No

rth

We

st

We

ste

rn C

ap

e

Province

Cu

rre

nt

bu

dg

et

pro

gre

ss

ag

ain

st

bu

dg

et

[%]

Current budget First quarter (June 2001) Current budget Second quarter (September 2001)

Progress against budgetsData for the whole departmentCapital progress not necessarily shown

when funds are allocated and not yet spent

Need to ensure that similar figures are reported

Spending on national and provincial roads – Intergovernmental Fiscal review

R 0

R 200 000 000

R 400 000 000

R 600 000 000

R 800 000 000

R 1 000 000 000

R 1 200 000 000

R 1 400 000 000

Ea

ste

rn C

ap

e

Fre

e S

tate

Ga

ute

ng

Kw

aZ

ulu

-Na

tal

Mp

um

ala

ng

a

No

rth

ern

Ca

pe

No

rth

ern

Pro

vin

ce

No

rth

We

st

We

ste

rn C

ap

e

SA

NR

AL

Province

Bu

dg

et

[R]

1997/1998 1998/1999 1999/2000 2000/2001 2001/2002 2002/2003 2003/2004

Auditor-General informationAverage Distribution of items in Audit reports

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

45.00%P

ers

on

ne

l

Ad

min

istr

atio

n

Sto

res

an

dliv

est

ock

Eq

uip

me

nt

La

nd

an

db

uid

ling

s

Pro

fess

ion

al

serv

ice

s

Tra

nsf

er

pa

yme

nts

Mis

cella

ne

ou

s

Item

Pe

rce

nta

ge

allo

ca

tio

n [

%]

Grants Supplementary Allocation grant

Ensure credible provincial budgets and adequate provision for infrastructure and social sectors

Ensure progress in implementing budget and financial management reforms

Provincial Infrastructure grant Fund provincial infrastructure (roads, schools,

health buildings) Fund reconstruction of 2000 flood damage

Grants – 2001/2002

R 0

R 100 000 000

R 200 000 000

R 300 000 000

R 400 000 000

R 500 000 000

R 600 000 000

R 700 000 000

Ea

ste

rn C

ap

e

Fre

e S

tate

Ga

ute

ng

Kw

aZ

ulu

-Na

tal

Mp

um

ala

ng

a

No

rth

ern

Ca

pe

No

rth

ern

Pro

vin

ce

No

rth

We

st

We

ste

rn C

ap

e

Gra

nt

tota

l [R

]

Provincial infrastructure rehabilitation Supplementary Total

Grants progress – 2001/2002

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

45.0%

50.0%

Ea

ste

rn C

ap

e

Fre

e S

tate

Ga

ute

ng

Kw

aZ

ulu

-N

ata

l

Mp

um

ala

ng

a

No

rth

ern

Ca

pe

No

rth

ern

Pro

vin

ce

No

rth

We

st

We

ste

rn C

ap

e

Gra

nt

tota

l [R

]

2nd Quarter Transferred 2nd Quarter Spent

Actual expenditure – 1997/98 to 2000/01Road expenditure 2000/2001- 2,9 % of

total provincial expenditure33% of road expenditure – new and

major rehab 1997/1998 to 2000/0126% of provincial expenditure – routine

maintenance 1997/98 to 2000/01

Provincial capital expenditure on roads

R 0

R 500 000 000

R 1 000 000 000

R 1 500 000 000

R 2 000 000 000

R 2 500 000 000

R 3 000 000 000

1997/98 1998/99 1999/00 2000/01 2001/02 2002/03 2003/04

Planned expenditure – 2001/2002EC – Road maintenance R 69 millionWC – Major improvement projects

(2000-2005) R 244 millionGautrans – maintenance / rehabilitation

263 km in 2001/2002 (R 226 million)Northern Province – Maintenance and

construction (roads and bridges) R 266 million

Proposed projects 2001/2002

0

100

200

300

400

500

600

700

800

Ea

ste

rn C

ap

e

Fre

e S

tate

Ga

ute

ng

Kw

aZ

ulu

-N

ata

l

Mp

um

ala

ng

a

No

rth

ern

Ca

pe

No

rth

ern

Pro

vin

ce

No

rth

We

st

We

ste

rn C

ap

e

Na

tio

na

l

Dis

tan

ce

[k

m]

Paved roads Gravel roads Total

ConclusionsNeed for availability of valid information

– roads focusNeed similar reporting / calculation

mechanisms (backlog, progress etc) Information is “dynamic” until the

Auditor General captures itNeed a team approach

Road forward PFMA effect on availability of budget and

progress information Service delivery measures

2002/03 – measurable objectives, service delivery standards, targets – included in budget submissions – describe how public funds are used

Need for good management systems Backlog calculations Standard format for data at regular intervals