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Select Committee on FinanceWater Services Operating and Transfer
Subsidy10 May 2006
Department of Water Affairs and Forestry
Jabulani Sindane : DGTrevor Balzer: Acting CFORichard Machaba : Manager National Transfers
Contents
• Progress 2005/06 : Water Services Operating and Transfer Subsidy
• Revised Allocations 2005/06 and Expenditure
• Earmarked Funds : Vote 34 2006/07
• Water Services Operating and Transfer Subsidy 2006/07
• 2006 to 2009 Allocations by Province
• General
PROGRESS 2005/06 : WATER SERVICES OPERATING AND TRANSFER SUBSIDY
Progress to date:• Behind our target, were able to conclude majority of transfer
agreements by the target date of 31 March 2006 (39 agreements, 70%) .
• Some municipalities, particularly those with weak administrative and technical capacity, where special arrangements will have to be made, provision built into agreements;
• Progress can be summarised as follows (to 30 April 2006) : – 43 (out of 58) agreements signed (74%);– 1841 staff transferred (23%);– 3584 staff seconded (44%); – 246 schemes with a total asset value of approximating R4.979
billion transferred (72%), and– Refurbishment total expenditure R362 million (43%).
Revised Operating & Transfer Subsidy 20005/06
O&M Refurb Total
Region Gazette Revised Gazette
Revised Gazette Revised
Western Cape 5,616 5,516 760 760 6,376 6,276
Northern Cape 17,284 11,399 12,376 10,682 29,660 22,081
Eastern Cape 79,992 74,489 6,772 4,800 86,764 79,289
Free State 17,677 17,677 10,202 10,202 27,879 27,879
KwaZulu Natal 22,438 22,554 12,505 17,488 34,943 40,042
Mpumalanga119,65
3117,921 11,184 11,984 130,837 129,905
Limpopo476,03
6482,804 34,555 36,558 510,591 519,362
North West 69,270 69,270 21,931 21,377 91,201 90,647
Gauteng 12,803 12,803 3,380 6,150 16,183 18,953
Total820,76
9814,433 113,665 120,001 934,434 934,434
DWAF OPERATING SUBSIDY: OPERATION AND MAINTENANCE EXPENDITURE AS AT
31 MARCH 2006 - 2005/2006 (Not audited)April’05 49,085May’05 60,831June’05 66,507July’05 61,557Aug’05 75,788Sept’05 61,230Oct’05 81,478Nov’05 80,326Dec’05 75,239Jan’06 68,114Feb’06 84,420March’06 102,184TOTAL 866,759
DWAF OPERATING SUBSIDY: REFURBISHMENT 31 MARCH 2006 - 2005/2006
(Not Audited)
Month ExpenditureApril’05 33May’05 2,948June’05 246July’05 10,303Aug’05 5,300Sept’05 3,509Oct’05 9,094Nov’05 10,495Dec’05 8,539Jan’06 3,565Feb’06 12,617March’06 22,693TOTAL 89,342
Earmarked Funds : Vote 34 2006/07(Funds may not be used for other
purposes than those specified)
Activity 2006/07 (R,000)
Devolution of funds from Public Works 97 303
Working for Water 369 000
Working on Fire 44 000
Water services operating subsidy (National)
490 500
Conditional grant to Local Government 500 000
TOTAL 1 400 803
WATER SERVICES OPERATING AND TRANSFER SUBSIDY
Division of Revenue Act 2006:• Allocations for 2006/07 reflected in:
– Schedule 6 – Specific Purpose Recurrent Grant allocation, R500 million (where transfer agreements have been concluded)
– Schedule 7 – Allocation in kind to Municipalities for designated programmes, R490,5 million (where transfer agreements are still under negotiation and staff still on the payroll of the DWAF ).
WATER SERVICES OPERATING AND TRANSFER SUBSIDY
SCHEDULE 2006/07 2007/08 2008/09
Schedule 6 500 000 550 000 600 000
Schedule 7 490 500 490 025 530 507
TOTAL 990 500 1 040 025 1 130 507
2006 to 2009 DoRA Allocations for OPERATION AND MAINTENANCE, HR AND REFURBISHMERNT (By Province)
Region 2006/07 2007/08 2008/09
Western Cape (1%) 6,550 4,341 4,899
Northern Cape (2%) 20,451 17,808 13,244
Eastern Cape (9%) 83,930 85,821 108,904
Free State (3%) 26,615 19,862 27,351
KwaZulu Natal (4%) 37,160 41,880 44,547
Mpumalanga (17%) 172,063 169,836 175,153
Limpopo (54%) 530,573 567,601 599,722
North West (9%) 96,571 113,565 129,386
Gauteng (1%) 16,587 19,611 27,794
Total 990,500 1,040,025 1,131,000
2006 to 2009 DoRA Allocations for REFURBISHMERNT (By Province)
Region 2006/07 2007/08 2008/09
Western Cape (1%) 700 0 0
Northern Cape (4%) 8,368 5,000 436
Eastern Cape (6%) 2,279 2,086 18,256
Free State (2%) 7,877 0 0
KwaZulu Natal (12%) 12,179 15,400 18,000
Mpumalanga (6%) 8,166 3,994 11,602
Limpopo (40%) 39,042 70,364 39,562
North West (24%) 23,145 35,733 29,708
Gauteng (5%) 2,184 3,658 11,000
Total 103,940 136,235 128,564
GENERAL• Specific provision made in Section 13 of the DoRA to adjust
allocations to Municipalities once transfer agreements are concluded and staff transfers concluded.
• Date for conclusion of transfer agreements 31 March 2006, 43 Agreements have now been concluded, 12 of the remaining 15 should be concluded by 30 June 2006 (7 in circulation and 3 95% complete).
• Transfer of staff, budgets and schemes to municipalities by 31 March 2007
• Some schemes (in excess of R100 million in value) will require parliamentary approval before transfer
• Conditional Grants will be incorporated into Local Government equitable share from 2008/09 onwards, final breakout 2011/12.
• Important condition for transfers : Necessary capacity must be in place in the receiving institution for the implementation of the conditional grant (NT and DPLG will have to assist in this regard).
“Some for all forever”