Economic Development Department 4 th quarterly report Presentation

Economic Development Department 4 th quarterly report Presentation to the Standing Committee on Appropriations 3 August 2011

Introduction • The information presented is based on 2010/11 Audited Annual Financial Statements • The Auditor-General expressed an unqualified audit opinion on the 2010/11 Annual Financial Statements 2

Overview of expenditure • The total adjusted budget for 2010/11 financial year was R 449. 8 million • Expenditure for 12 months of 2010/11 is R 400. 6 million or 89% of the adjusted appropriation • Excluding transfers expenditure was R 44. 2 million or 48% of adjusted appropriation of R 91. 3 million • No comparison with 2009/10 as EDD as a Budget Vote was in its first financial year of operation 3

Context of expenditure • 2010/11 was EDD’s first full year of operation • EDD staff grew from 18 to 79 over the financial year • Challenges experienced in recruiting suitably qualified and experienced staff • Compensation of employees a major cost driver (60% of budget) which accounts for lower expenditure • As will be seen below, EDD has applied for rollovers of committed funds totaling R 35 million, which may change expenditure picture 4

Overall expenditure 5

Programme 1 • Actual spending for Programme 1 at 31 March 2011 is R 35 million or 78% of budget. 6

Programme 2 • Actual expenditure for Programme 2 amounts to R 6. 6 million or 39% of the budget. • Slow spending on this programme due to slow rate of filling posts as EDD was in its first year of operation 7

Programme 3 • Financial Year expenditure for Programme 3 was R 359 million or 95% from budget of R 376 million • R 356. 5 million was transferred to EDD’s Public Entities 8

Programme 4 • Year to date spending for programme 4 was R 455 000 or 4. 3% from adjusted budget of R 10. 712 million • Slow spending on this programme due to slow rate of filling posts as EDD was in its first year of operation 9

Employment and vacancies 10

Rollovers requested Rollovers • EDD has requested National Treasury to rollover 2010/11 committed but unspent funds to 2011/12 financial year, amounting to R 35, 050 million • The decision from NT expected in the first week of August 2011 • Roll-overs were requested for the following: 11

Overview of revenue • Revenue collection for 2010/11 totaled R 547 million • Main revenue generator for EDD is fines and penalties from Competition Commission • Revenue projected exceeded as a result of Pioneer Food settlement among others 12

Concluding remarks • EDD has done well to achieve an unqualified audit in its first full year of operation • It has made a concerted effort to fill posts as rapidly as possible • 60% of funded posts filled in the financial year • Expenditure will improve as posts are filled 13

Thank you