PRESENTATION TO THE NCOP FINANCE COMMITTEE MEETING 27

PRESENTATION TO THE NCOP FINANCE COMMITTEE MEETING 27 AUGUST 2008 www. fs. gov. za 1

CONTENTS First quarter performance on conditional grants • Devolution of property rate fund • Infrastructure grant for provinces • Trends in allocations, transfers & actual expenditure • Monitoring capacity 08/09 • Over / under spending • Capacity constraints www. fs. gov. za 2

INFRA GRANT TO PROVINCES 17% 0% 10% www. fs. gov. za 3

DEVOLUTION OF PROPERTY RATES GRANT 10% 0% www. fs. gov. za 4

DEVOLUTION OF RATES EXPENDITURE • • The Province budget = R 125, 066 m No expenditure to date National Works did all payments till July 08 New Payments only after receipt of new invoices after August 08 www. fs. gov. za 5

CONCERNS IN RATE GRANT • The R 125 m was for 2700 properties; • The asset register has about 7500 properties. • Site visits confirmed the following: – Municipal records are incorrect (site nr, owner details) – Municipalities are not invoicing us on all our properties. – Maluti A Phufong NPW has only paid for 158 properties while the inspection revealed 470 properties. www. fs. gov. za 6

CONCERNS IN RATE GRANT • Municipalities indicated that they will implement the market related rates and taxes from next year. (Improvements included. ) • Payment of rates & taxes on farms was excluded till now • Physical verification and reconciliations with municipalities to be done before accurate estimates are possible. • Agreements on tariffs, valuations, ownership, occupation www. fs. gov. za 7

INFRA GRANT EXP 1 st QUARTER Row Labels Budget Exp till June % Spent CALEDON BRIDGE WEPENER 21, 000 12, 293 59% HARRISMITH - VERKYKERSK 78, 800 28, 662 36% MAINTENANCE CONTRACTS 1, 168 100% QWAQWA-ROUTE 4 62, 000 6, 002 10% N 1 -SASOLBURG P 10/1 81, 606 37, 042 45% REITZ-PETRUS STEYN P 9/2 74, 752 34, 134 46% SPRINGFNT-BETHULIEP 45/2 75, 886 29, 912 39% 395, 212 159, 066 40% Grand Total www. fs. gov. za 8

CONTRACT PRICE ADJUSTMENT www. fs. gov. za 9

EXAMPLE OF RISE IN BITUMEN PRICE www. fs. gov. za 10

CALEDON BRIDGE AT WEPENER Project Value: R 110 million The new and the old www. fs. gov. za 11

Springfontein – Bethulie Project Value: R 195 million www. fs. gov. za 12

Rehabilitation of SS 18, Harrismith to Verkykerskop. Project value: R 172 million www. fs. gov. za 13

Route 4 (Swartwater Dam) Project Value: R 163 million Before Brick making www. fs. gov. za 14

Before Construction During Construction Project still under construction Rehabilitation N 1 –Sasol Value: R 255 million www. fs. gov. za 15

CAPACITY CONSTRAINTS • Funding – For continuing projects – For NYS and contractor development – For backlogs – For remaining flood damages – overspending • • Experience in engineering and technical field Training capacity for contractor development Support for NYS Established contractors at CIDB Levels www. fs. gov. za 16

Challenges • • EPWP Gravel roads Overloading Maintenance backlog Rail revitalisation Freight / HIV and AIDS / roads congestion Rising cost of construction www. fs. gov. za 17

THANK YOU www. fs. gov. za 18