Hospital Revitalisation Grant 201011 Financial Year Presentation to

Hospital Revitalisation Grant: 2010/11 Financial Year Presentation to the Select Committee on Finance October 2010

Background. • • The Hospital Revitilisation Grant is utilised to replace and revitalise current hospitals in the Province. Prioritization of the projects is done as per the Departmental Service Transformation Plan. The following projects have been prioritised in the allocation: – Mental Health Hospital; – Upington Hospital; – De Aar Hospital; – Prof ZK Matthews Hospital; – Kimberley Hospital; – Kuruman Hospital – Postmasburg Hospital • The Department of Roads and Public Works serves as the implementing agent on all infrastructure development projects;

Financial Information. • .

. Mental Health Hospital • Purpose Provision of Mental Health Services . Commencement Date 2006 Projected Completion Date 2008 Initial Project Costs R 290 million Expenditure to date R 360 million Cause of delay Slow delivery by the contractor on site Current Status Matter with the Court of Law Remedial measures Appointment of CIDB graded contractors Additional costs to complete project R 380 million Total estimated cost R 740 million

Upington Hospital. • . Purpose Provision of Level Two Services Commencement Date 2009 Completion Date 2012 Initial Project Costs R 836 million (construction, organizational development, health technology & quality assurance, excluding escalations) Expenditure to date R 278 million Cause of delay None Current Status 50% Total project costs R 836 million

De Aar Hospital. • . Purpose Provision of Level Two Services Commencement Date 2010 (Phase 1) Completion Date 2012 Initial Project Costs R 400 million (construction, organizational development, health technology & quality assurance, excluding escalations) Expenditure to date R 25 million (earth works) Causes of Delay Change of services package Current Status Site establishment for staff accommodation, reservoir & fencing Projected project costs R 400 million

Prof ZK Matthews. • . Purpose Provision of Level One Services Commencement Date 2006 Completion Date 2008 (additional work commenced in 2009) Initial Project Costs R 80 million Expenditure to date Causes of Delay None Current Status 98% additional work complete Projected project costs

Kimberley Hospital. • . Purpose Provision of Tertiary Services Commencement Date 2013 Completion Date 2018 Initial Project Costs R 1, 600 billion Expenditure to date None Causes of Delay None Current Status Development of business case Projected project costs R 1, 600

Kuruman Hospital. • . Purpose Provision of Level Two Services Commencement Date 2013 Completion Date 2016 Initial Project Costs R 900 million Expenditure to date None Causes of Delay None Current Status Development of business case Projected project costs R 900 million

Postmasburg Hospital. • . Purpose Provision of Level One Services Commencement Date 2011 Completion Date 2013 Initial Project Costs R 200 million Expenditure to date R 0 Causes of Delay Approval of the business case by the NDo. H Current Status Development of Project Brief Projected project costs R 200 million

Performance & Monitoring. (Do. H & Public Works) • . • Each project has the initial Project Implementation Plan to outline the activities and time frames; • The project deliverables are measured on quarterly basis; • The Project Implementation Plan is developed on annual basis but with quarterly targets for reviews; • Monthly financial reports are submitted to NDo. H; • A representative of PDo. H participate in the site meetings; • Monthly progress meetings between the implementing agent and the client take place; • The National Treasury Infrastructure Reporting Model and In Year Monitoring report are used to monitor expenditure; • Reports are also presented to the Project Management Forums.

Co-ordination of the HRP Project. • Prioritisation was done through the Service Transformation Plan • The following table presents the HRP projects implementation plan up to 2016/17 financial year:

Co-ordination of HRP Project (cont). HOSPITAL REVITALIZATION PROGRAMME 2010 UP TO 2016 BUDGET BID • . Project 2009/2010/2011/2012/2013/2014/2015/2016/2017 Barkly West Hospital R 9, 000 R 1, 000 R 0 R 0 R 0 Mental Health Facility R 155, 967 R 69, 800 R 10, 000 R 0 R 0 R 0 Upington Hospital R 140, 000 R 220, 000 R 240, 000 R 197, 000 R 20, 000 R 0 R 0 De Aar Hospital R 18, 307 R 103, 068 R 130, 000 R 120, 000 R 10, 000 R 0 R 0 Postmasburg Hospital R 6, 000 R 20, 000 R 107, 572 R 65, 436 R 0 R 0 Kuruman Hospital R 0 R 150 R 2, 500 R 140, 000 R 200, 000 R 250, 000 Kimberley Hospital R 6, 000 R 2, 392 R 1, 482 R 170, 000 R 250, 000 Hartswater Hospital R 0 R 500 R 200 R 49, 243 R 30, 379 R 15, 742 Kakamas Hospital R 0 R 0 R 500 R 1, 500 R 47, 000 R 28, 124 Springbok Hospital R 0 R 0 R 500 R 1, 500 R 0 Grand Management R 5, 000 R 6, 000 R 5, 500 R 6, 000 Total Allocation R 340, 274 R 420, 218 R 410, 892 R 431, 754 R 461, 679 R 489, 379 R 518, 742 R 549, 866

Performance of Contractors and Consultants. • Contractors are unable to meet the monthly deliverables as per their set programmes due to insufficient capacity in their companies; • Their respective under- performance subsequently leads to underspending on the project; • Poor coordination between the Contractors/Consultants and implementing agent leads to further delays on the project.

. Capacity to implement the Hospital Revitilisation Programme • The Dept of Public Works is responsible for the implementation of the programme; • The Department of Health is only responsible for planning(development of business case, project brief and supervision of designs), reporting and monitoring of projects; • Due to limited capacity at Public Works, there is no proper monitoring on projects, hence mental health hospital.

Conclusion • Projects are planned timeously, with the necessary inputs from all stakeholders; • Challenges are often experiences, with the service providers either not meeting their deadlines, or not being able to complete the project; • Remedial measures include: Ø Termination at the earliest confirmed inability to complete the contract; Ø Regular monitoring meetings are held, in order to assess progress; Ø Regular report-backs to management and recommendations on how to prepare for the take-over of the project, once completed; Ø Ensuring that there is value-for-money is attained. THANK YOU