Province of the EASTERN CAPE Department of Roads & Transport “Quality Service Delivery through Transportation Excellence” Report on Conditional Grants

Province of the

EASTERN CAPEDepartment of Roads & Transport

“Quality Service Delivery through Transportation Excellence”

Report on Conditional Grants and Report on Conditional Grants and Capital Expenditure 3Capital Expenditure 3rdrd Quarter Quarter

2007/2008 Financial Year2007/2008 Financial Year

NCOP PRESENTATION05 FEBRUARY 2008

“Quality Service Delivery through Transportation Excellence” 2

Eastern Cape Department of Roads & Transport

Presentation outlinePresentation outline

1. Purpose of the Conditional Grant and Capital Expenditure managed by the department in terms of the DORA

2. Expenditure trends on Conditional Grants and Capital Expenditure for the MTEF period 2005/06 – 2007/08

3. Explanation of expenditure variances. 4. Management & monitoring of Conditional Grants and Capital

Expenditure5. Social & EPWP indicators for new roads 2007/20086. Results in 07/087. Challenges faced in management of grants and Capital

Expenditure.8 Future budget trends: MTEF



1. Purpose of this Conditional 1. Purpose of this Conditional Grant and Capital ExpenditureGrant and Capital Expenditure►To accelerate construction and rehabilitation of new and To accelerate construction and rehabilitation of new and existing Eastern Cape Provincial road infrastructure and Transport existing Eastern Cape Provincial road infrastructure and Transport Services.Services.► Accelerate implementation of the Provincial Growth Accelerate implementation of the Provincial Growth Development Plan.Development Plan.► The grant requires us to focus on the application of labour The grant requires us to focus on the application of labour intensive methods in order to maximise job creation and skills intensive methods in order to maximise job creation and skills development.development.► Enhance capacity to deliver Road Infrastructure and Transport Enhance capacity to deliver Road Infrastructure and Transport facilities.facilities.►Create the necessary Transport Services facilities in Municipal Create the necessary Transport Services facilities in Municipal Areas as supported by ITP and MTABs.Areas as supported by ITP and MTABs.



DEPARTMENTAL EXPENDITURE DEPARTMENTAL EXPENDITURE

►Expenditure as at 31/12/07

Program SummaryOriginal Budget

Adjusted Budget

Actual End of

December%

spent

IYM projecti

ons

R'000 R'000 R'001 R'0001. Administration 144,030 157,280 112,536 71.6% 44,744

2. Roads Infrastructure 1,515,105 1,615,105 1,181,513 73.2% 433,592

3. Publ ic Transport 191,884 182,954 115,008 62.9% 67,946

4. Traffi c Management 146,472 146,472 97,210 66.4% 49,262

5. Community Based Transportation 241,574 241,574 148,557 61.5% 93,017

TOTAL PROGRAM SUMMARY 2,239,065 2,343,385 1,654,824 70.6% 688,561



3. 3. 2. Expenditure Trends CG2. Expenditure Trends CGProvincial Infrastructure Grant

Provincial Infrastructure Grant

2005/06

R’000

2006/07

R’000

2007/08

R’000

Budget 675,330 742,057 838,937

Expenditure to

31 December 2007

675,330 742,139 682,580

% Expenditure to

31 December 2007

100% 100% 81,36%



3. Explanation for expenditure 3. Explanation for expenditure variancesvariances

►The variance (R53,337 000.00) or 6.36% over expenditure was due to:◘ The accelerated programme of the contractor on the

Maclear to Mount Fletcher and Middledrift to Alice projects which will be completed three and two months before scheduled completion time, respectively.

◘ Early start on the Mthatha Quarry Road.◘ However, the programme is expected to break even,

come the 31 March 08.



Sub-programme 2005/06

R’000

2006/07

R’000

2007/08 2ND Q

R’000

Prov. Infr Grant (PIG) 675,330 742,139 682,580

Transfers to Municipalities (from Equitable Share)

25,478 52,248 0

Current Projects 521,399

Capital Payments 223,675 137,393 137,998

Total Capital Expend 924,483 931,780 1,341,977

% PIG 73 80 50.9%

Expenditure Trends – PIG and (Total) Capital Expenditure



PROJECT BREAKDOWNPROJECT BREAKDOWNProject Information

2007/08Budget

Expenditureup to date

%Exp.

Number of projects

Capital Projects

1,103,210 820,578 74.4% 75

Current Projects

781,833 521,399 66.7% 56

Total

1,885,043 1,341,977 71.2% 131

EPWP ProjectsTotal Available this Financial

Year

Expenditureup to date

%Exp.

Number of projects

Capital Projects

903,575 695,914 77.0% 66

Current Projects

619,234 415,621 67.1% 50

Total

1,522,809 1,111,535 73.0% 116



►Departmental officials attend monthly site progress meetings►In addition the CFO and programme manager conduct random site visits on the progress of the contracts.►District Roads Engineers visit and inspect projects in their particular areas.►Professional Engineering Consultants on site monitor the projects.►The Department submits a detailed quarterly report to Provincial and National Treasuries, which captures the full details of the projects including the allocation for the year, the expenditure for the period in question and outputs achieved.► Specific reports are submitted on progress with respect to social indicators such as employment, BEE, local resources etc.►Monthly In-Year Monitoring reports are also submitted to the provincial treasury to monitor the expenditure.►SANRAL(SA National Roads Agency) implements 6 projects on behalf of the department in terms of a Service Level Agreement monitored by Departmental staff.

9. Management & Monitoring mechanism


10. EPWP SOCIAL INDICATORS10. EPWP SOCIAL INDICATORS

Project Name

Total local Labour Employed for 1st, 2nd and 3rd Q 07/08 Male Female Youth Disabled

Local Labour Value for 1st, 2nd and 3rd Q 07/08

Local Resource Value for 1st, 2nd and 3rd Q 07/08

Rands Rands

1. Ugie to Langeni Phase 1 45 5 16 24 0 996,342 5,797,698

2. Ugie to Langeni Phase 2 661 261 131 267 2 7,242,312 13,214,324

3. Ugie to Langeni Phase 3 691 245 156 289 1 8,708,432 15,142,421

4. Middledrift to Alice 667 239 164 262 2 9,131,234 12,984,534

5. MaClear: Halycon Drift to Ketekete 321 109 77 133 2 4,342,425 9,425,323

6. Motherwell Intersection 45 15 9 21 0 985,643 1,926,453

7. N10 to Alicedale 120 37 21 61 1 1,060,000 1,264,231

8. Graaff Reinet to Jansenville 38 11 6 21 0 1,123,245 5,174,640

9.. Xuka Bridge 77 26 15 36 0 1,320,043 953,429

10. Klipplaat to Jansenville 145 37 42 66 0 2,154,324 3,699,359

11. Sulenkamma Hospital Road 974 345 241 386 2 9,142,657 13,245,324

12. Mt Frere to R56 Ph 1 123 42 19 61 1 2,126,747 12,574,325

13. Peddie to Bira River 22 6 8 8 365,937 98,453

13. Chintsa Bridge 12 2 2 8 55,678

14. Routine Maintenance Programmes 3256 651 488 2084 33 15,985,643 36,954,654

Community Based Transport Programmes 1971 389 583 977 19 11,345,261 4,323,546

9168 2420 1978 4704 63 76,085,923 136,778,714



RESULTSRESULTS

►Launched train service between Queenstown and Molteno in October 07.

►Received Testing License from Rail Safety Regulator.

►Linked MaClear with Mount Fletcher with surfaced road.

►Renovated Bhisho airport such that aircrafts are able to land.

►Handed over to contractors the Greenville Hospital Road, Madwaleni Hospital Road and Zithulele Hospital Road.



►Acute shortage of road building materials .►Lack of adequate funding for roads impacts negatively on delivery of a good Road Network and Transport Services.►Ever increasing road construction costs►The construction industry CPIX is currently 24%.►Many of the Access Roads are still impassable and inaccessible.► High Ratio of Gravel to Surfaced Roads (85:15).

12. CHALLENGES12. CHALLENGES



14. Future budget trends: MTEF 14. Future budget trends: MTEF beforebefore reduction CG allocation reduction CG allocation

Budget 2005/06

R’000

2006/07

R’000

2007/08

R’000

2008/09

R’000

Conditional Grant (PIG)

675,330 742,139 984,943 1,055,321

Total Capital Exp budget

924,483 931,780 1,247,778 1,263,163

% Conditional

grant of

Total Capital

budget

73 80 79 84



16. Future budget trends:MTEF 16. Future budget trends:MTEF afterafter reduction of CG allocation reduction of CG allocation

Budget 2005/06

R’000

2006/07

R’000

2007/08

R’000

2008/09

R’000

PIG 675,330 742,139 838,657 838,937

Capital Exp Portion

249,153 189,641 263,721 279,106

Total Capital budget

924,483 931,780 1,102,378 1,118,043

% PIG of

Capex

budget

73 80 76 75



17. Future budget trends: MTEF 17. Future budget trends: MTEF afterafter reduction CG allocation reduction CG allocation

0

200000

400000

600000

800000

1000000

1200000

2005-06 2006-07 2007-08 2008-09

Conditional Grant

Total CapexBudget



18. BUDGET SUMMARY

2005/06 2006/07 2007/08 Nominal Growth

% of total budget 2008/09 2009/10

Administration 107,123 151,867 144,030 ( 5.2 % ) 6 % 152,386 158,695

Roads Infrastructure 1,368,965 1,494,437 1,615,105 1.38 % 69 % 1,566,248 1,605,001

Public Transport 129,181 162,261 191,884 18.26 % 8 % 212,696 221,784

Traffic Management 113,346 123,792 146,472 18.32 % 7 % 160,835 167,530

CommunityBasedTransportation 54,392 82,056 241,574 194.4 % 10 % 354,053 510,686

Total 1,773,007 2,014,413 2,339,065 11.15 % 100 % 2,446,218 2,663,696



19. Effect of PIG reduction19. Effect of PIG reductionPGDP Projects Amount R mil Status Wild Coast Meander Phase I 120 Under Design at present Wild Coast Meander further phases 70 Feasibility at procurement stage Bizana to Port Edward (R61) 114 Feasibility at procurement stage Cacadu Magusheni (R61) 10 Feasibility at procurement stage Mt Frere to R56 Phase 3 96 Ready for tender Sub-Total 410 2010 projects Amount R mil Status Uitenhage to Witteklip 91 Design Stage Motherwell Addo 145 Design at Procurement stage Addo Paterson 20 Design Stage Fonteinskloof to Nanara 150 Ready for tender EL to Lillyvale 100 Ready for tender Sub-Total 506 Total 916



21. Impact of Infrastructure backlogs 21. Impact of Infrastructure backlogs on MTEFon MTEF

Financial Years (R '000 000)

2005/06 2006/07 2007/08 2008/09

Maintenance allocation 424 561 629 701

Maintenance needs 1,991 1,991 1,991 1,991

Backlogs 1,567 1,430 1,362 1,290

Accumulative backlog 8,067 9,508 10,870 12,160



23. Estimated Cost of backlog23. Estimated Cost of backlogItem Rand x '000

Gravel roads to surfaced roads 4,479,000

Rehabilitation of surfaced roads 2,520,000

Bridges 89,500

Hospital accesses 1,251,350

Total Provincial backlog 8,339,850

Access roads 3,500,000

Total Backlog 11,839,850



II

thank you…thank you…

Province of the

EASTERN CAPEDepartment of Roads & TransportQuality service delivery through transportation excellence

Documents

Province of the EASTERN CAPE Department of Roads & Transport “Quality Service Delivery through Transportation Excellence” Report on Conditional Grants