Estimates of National Expenditure 2005 Joint Budget Committee

Estimates of National Expenditure 2005 Joint Budget Committee 28 February 2005

What’s covered today • How ENE gets put together – the budget process • How it relates to other budget documents • What it contains – Specific illustrations • Recent reforms – improving information quality • Using the ENE to improve oversight • Questions and discussion

How it gets put together… Culmination of a year-long process, involving: – Review of policy priorities, fiscal policy and Do. R – Guidelines sent to departments in April/May – MTEF budget proposals submitted by departments in August – Evaluation and budget hearings in Aug/Sep – Cabinet approves new MTEF in November – Departments submit first draft of ENE chapter in December – Finalised through a collaborative process Jan/Feb Happens alongside in-year decisions on rollovers and other adjustments

MTEF budget process Medium-term policy review Jan 04 Feb March April May June July Aug Sep Oct Nov Dec Jan 05 Feb Cabinet Lekgotla State of Nation Budget Speech Consider new spending priorities and trade-offs Departmental and agency planning and budgeting Revise framework, fiscal policy and Do. R Treasuries Departments evaluate prepare budget proposals MTEC hearings Table MTBPS Cabinet approves new MTEF Prepare budget documentation National and provincial budgets tabled

After Do. R – budget process in each sphere allocates to: National government delivers: National Share Available Expenditure Provincial Share • Policing, foreign affairs, defence, higher education • Makes policy Provinces deliver: • School education, health, social welfare Local Share Municipalities deliver: • Water, sanitation, refuse removal

Its relation to… • Appropriation Bill – How appropriated/voted funds are allocated to subprogramme & service delivery targets – Classification of expenditure ito of standard items • Budget Review – How fiscal and budget policy translates into spending programmes of national departments • Division of Revenue Bill – Conditional grants transferred from national to provincial governments

As a reference document it can be used to… …show what resources and how priorities have and will be attained.

ENE contains… • 926 pages • Spending plans of 34 national votes(departments and agencies) • Seven-year info on spending and estimates of 187 departmental programmes • Similar number of measurable objectives • ± 750 outputs with service delivery targets

Each chapters details… • Programme purpose and measurable objectives • Strategic overview – Main policy developments, achievements and future plans • Expenditure estimates & trends – Programme and economic classification – 2005/06 voted by Parliament – 2006/07 to 2007/08 form the basis for planning the 2005 Budget • Service delivery objectives and indicators – Recent outputs • Brief summary of achievement on output targets in 2004 ENE – Medium-term output targets • Subprogramme outputs, indicators and targets • Detailed expenditure and budget tables

ENE 2005 Restitution and land reform Achievements • 6 609 claims settled in 2002/03 period • Total claims settled by end 03/04 = 56719. • Distributed 641 995 ha through LRAD programme. Targets • Settle another 27889 restitution claims by March 2006 • Redistribute another 303 569 hectares by March 2005 • Reform projects owned by women = 30%

ENE 2005 Introduction of sector policing Achievements • 13 380 firearms confiscated – 31 050 firearms destroyed • Sector policing implemented in 307 priority & presidential stations Targets • Recruit 29 790 personnel over the next 3 -yrs • Sector policing at all 63 high contact crime stations in 05/06

ENE 2005 Transport infrastructure - SANRAL Achievements, incl. • 1457 jobs through poverty alleviation projects • 3600 km of road extensions • Upgrading of 23 border posts • 91 km of sidewalks • 9 bridges

Also contains… • Consolidated expenditure tables – According to economic classification – Disaggregated into current, transfers and capital expenditure – Conditional grants to provinces and municipalities – Training – ICT – Infrastructure • Definition of economic reporting format

Improving information quality • New economic reporting format and standard chart of accounts in 2004 – Improve accountability and modernise accounts – Better information for oversight and policy decisions • Accounts of 120 public entities presented in 63 financial summaries in 2005 ENE • Precise description of allocation of additional resources

Using ENE to improve oversight

Using ENE to exercise oversight Measurable objectives: • How does the objective support the overall mandate of the programme? • What mechanisms are in place to evaluate its achievement? Strategic overview • Are departmental policy developments aligned to Government’s strategic priorities? • What are the policy implications for provinces and municipalities?

Using ENE to exercise oversight (cont. ) Expenditure estimates and trends • How has expenditure supported the key policy priorities • What is the extent of reprioritisation? • Are new funds allocated to priority programmes and plans? Service delivery objectives and indicators • What mechanisms are in place to monitor the achievement of targets and reporting to parliament

Thank you