Queries on spending or adjusted budget numbers should therefore, in the first instance, be referred to the relevant head official of the provincial department, and in the second instance to the head official of the provincial treasury. Queries on conditional grants may also be referred to the relevant head official of the administering national department.
The budgeted expenditure figures take account of revisions effected in the provincial adjustment budgets, which include R7.6 billion allocated to provinces (R4.6 billion to the provincial equitable share and R2.9 billion to conditional grants) through the 2008 Adjusted Estimates of National Expenditure.
The approved additional adjustments to provinces were gazetted on 18 December 2008 and these additional transfers were taken up in the provincial adjusted budgets in terms of Section 31(2) of the PFMA and Section 22(2) of the Division of Revenue Act, 2008.
5.1 In compliance with Section 26 of the Division of Revenue Act, 2008, the national Department of Housing stopped the transfer of funds following slow spending on the part of the Eastern Cape (R270 million) and R52 million in North West to deal with ex-cross border projects in the Northern Cape.
5.2 In compliance with Section 27 of the Division of Revenue Act, 2008, the national Department of Housing re-allocated funds to the value of R322 million between provinces following demonstrated capacity to spend in Gauteng (R152 million), Free State (R68 million), Mpumalanga (R50 million) and R52 million in Northern Cape for ex-cross border projects.
In addition to the national adjustments, provinces increased their main budgets by R3.5 billion. The provincial adjustments consist mainly of unspent conditional grants not surrendered to the National Revenue Fund and other funds surrendered to the Provincial Revenue Funds during the 2007/08 financial year.
In light of the above, in aggregate, provinces increased their main budgets (expenditure side) by R11 billion with the bulk to health (R4.1 billion), education (R2.5 billion) and public works, roads and transport (R1.7 billion).
In aggregate, provinces have spent R263.1 billion or 101.4 per cent of their adjusted budgets of R259.5 billion in 2008/09 (preliminary outcome). This represents a spending increase year-on-year of 23.3 per cent or R49.7 billion over the audited R213.4 billion spent in 2007/08.
97.6 per cent in Western Cape and 98.
106.1 per cent in Gauteng and 104.2 per cent in KwaZulu-Natal.
The preliminary outcome shows that in aggregate six provinces have underspent their adjusted budgets by R1.7 billion. This is largely due to capital expenditure and conditional grants which reflect underspending in most provincial departments for 2008/09. However, Gauteng, KwaZulu-Natal and Limpopo overspent their adjusted budgets by R5.3 billion in aggregate, largely due to over-expenditure on personnel in provincial education and health departments.
In the case of Gauteng, a loan of R4.2 billion was allocated for the 2009/10 financial year, to assist the province in its contribution to the Gautrain project. Currently this project is the main reason for the overspending in the Gauteng province. Spending outcome on the Gautrain project amounts to R7.5 billion or 157.8 per cent against the adjusted allocation of R4.8 billion, which includes the provincial equitable share and conditional grant portions.
Eastern Cape 39 390 048 38 996 670 99.0% 14.8% 30 215 599 29.
Free State 16 246 339 16 058 734 98.8% 6.1% 13 275 300 21.
Gauteng 48 605 231 51 586 521 106.1% 19.6% 41 714 514 23.
KwaZulu-Natal 53 200 522 55 429 200 104.2% 21.1% 44 482 826 24.
Limpopo 30 562 400 30 672 008 100.4% 11.7% 24 735 315 24.
Mpumalanga 20 436 326 20 084 264 98.3% 7.6% 16 265 247 23.
Education preliminary outcome is at R107.6 billion or 100.9 per cent of the R106.7 billion combined education adjusted budgets and remains the largest item on provincial adjusted budgets (41.1 per cent).
21.7 per cent or R19.2 billion increase compared with the audited spending in the 2007/08 financial year.
Health expenditure (preliminary outcome) is at R74.9 billion or 101.8 per cent of the R73.6 billion combined health adjusted budgets and is the second largest item (after education) on provincial adjusted budgets (28.4 per cent). The spending pattern reflects a 19.7 per cent or R12.4 billion increase compared with the audited spending in the 2007/08 financial year.
Social development preliminary outcome for the 2008/09 financial year is recorded at R8.3 billion or 97.8 per cent of the R8.5 billion social development adjusted budgets.
Provincial education departments spent R4.7 billion or 95.9 per cent of their R4.9 billion education capital adjusted budgets, which is a massive 45.3 per cent or R1.5 billion more than the audited spending over the previous financial year.
Provincial health departments show improvement on capital spending when compared to the previous financial year, which is 15.8 per cent or R819 million more than the audited spending of the previous financial year. However, they have only spent almost R6 billion or 82.9 per cent against their R7.2 billion health capital adjusted budgets.
The greatest share of provincial capital is on the budgets of public works, roads and transport departments at 36.8 per cent. The sector spent R8.3 billion or 97.4 per cent against its combined capital adjusted budget of R8.5 billion. This represents an increase of 15.7 per cent or R1.1 billion compared to the audited outcome of last year.
Provincial own revenue collected is 0.9 per cent or R97.8 million more than the adjusted forecast of R9.2 billion. National government has transferred R204 billion of the equitable share and R41.2 billion in conditional grants to provinces, for the 2008/09 financial year.
The budgeted figures take account of revisions effected in the adjusted estimates of provinces, which were tabled in their provincial legislatures during November/December 2008 and also cater for amendments made to the adjusted estimates as a result of a Gazette that was published on 06 February 2009 which revised the allocations of the Integrated Housing and Human Settlement Development grant between certain provinces.
Table 1 indicates that provinces have spent R263.1 billion or 101.4 per cent of adjusted budgeted expenditure for the 2008/09 financial year. The preliminary outcome is at a higher level in percentage terms compared to the audited outcome for the 2007/08 financial year (98.8 per cent).
However, in nominal terms, spending is 23.3 per cent or R49.7 billion higher than last year when provinces had spent R213.4 billion (audited outcome). Between provinces, spending ranges from the lowest share of 97.
98.3 per cent in Mpumalanga to the highest at 106.
104.2 per cent in KwaZulu-Natal.
Education preliminary outcome is at R107.6 billion or 100.9 per cent of the total provincial education adjusted budget of R106.7 billion, an increase of 21.7 per cent or R19.2 billion compared to the R88.4 billion spent in 2007/08. The original education budget, in aggregate, has been increased by R2.5 billion during the provincial adjusted estimates process.
99.3 per cent and both Gauteng and Western Cape at 99.8 per cent, to the highest in Northern Cape at 106.5 per cent and KwaZulu-Natal at 103.1 per cent.
The bulk of education expenditure is on personnel (78.1 per cent). The preliminary outcome on education personnel amounts to 103.1 per cent or R84 billion of the education personnel adjusted budgets of R81.5 billion.
Spending by provinces ranges from the lowest in Eastern Cape at 99.7 per cent and North West at 100.
111.5 per cent and 106.7 per cent respectively.
The preliminary outcome on goods and services (mostly learner support material) in education is recorded at 88.1 per cent or R10.9 billion of its R12.4 billion adjusted budget. It comprises approximately 11.6 per cent of total provincial education adjusted budgets, which is 0.7 percentage points more than the share in 2007/08.
The preliminary outcome for education capital is at R4.7 billion or 95.9 per cent of the R4.9 billion education capital adjusted budget. Capital spending for education between provinces ranges from the lowest in Free State at 79.
Page 2 of 10 85.2 per cent to the highest in Northern Cape at 143.
107.6 per cent.
Eastern Cape 906 625 975 366 107.6% 30.9% 454 798 114.
Free State 411 099 326 977 79.5% 19.1% 234 803 39.
Gauteng 609 409 588 766 96.6% 25.2% 519 970 13.
KwaZulu-Natal 1 271 940 1 170 545 92.0% 20.1% 945 043 23.
Health expenditure is at R74.9 billion or 101.8 per cent against the total provincial health adjusted budget of R73.6 billion, representing an increase of 19.7 per cent or R12.4 billion compared to the spending of the previous financial year.
Page 3 of 10 health budget, in aggregate, has been increased by R4.1 billion during the provincial adjusted estimates process.
Northern Cape and Mpumalanga have spent the lowest share of their health adjusted budgets at 94.1 per cent and 96 per cent respectively.
Northern Cape 949 898 892 857 94.0% 22.9% 786 437 13.
Health personnel expenditure is at R42.8 billion or 105 per cent of the health personnel adjusted budget of R40.8 billion, an increase of 22 per cent or R7.7 billion more compared to the R35.1 billion spent in 2007/08.
The preliminary outcome on non-personnel non-capital items in health, which includes medicines, drugs and other current expenditure, is recorded at 102.2 per cent or R26.1 billion of the R25.6 billion adjusted budget. This is an increase of 17 per cent or R3.8 billion compared to the R22.3 billion audited outcome in 2007/08.
Eastern Cape 1 101 532 822 782 74.7% 26.1% 802 396 2.
Free State 421 420 331 996 78.8% 19.4% 302 700 9.
Gauteng 1 533 174 1 325 536 86.5% 56.8% 1 084 843 22.
KwaZulu-Natal 1 298 231 1 188 143 91.5% 20.4% 1 070 936 10.
Capital expenditure in the health sector is almost R6 billion or 82.9 per cent of the R7.2 billion health capital adjusted budget. This is lower than the overall capital expenditure against adjusted budgets of 91.1 per cent.
However, this is higher by 15.8 per cent or R819 million more than the R5.2 billion spent for the same period last year. Between provinces, the lowest rate of spending is in Western Cape at 64.8 per cent and Northern Cape at 65.4 per cent with Limpopo and North West recording the highest rate of spending at 97.
95.1 per cent respectively.
Provinces registered spending of 97.8 per cent or R8.3 billion of their R8.5 billion social development adjusted budgets. This represents a significant increase of 34.6 per cent or R2.1 billion above the R6.2 billion spent in 2007/08.
Eastern Cape 1 396 525 1 315 521 94.2% 3.4% 880 426 49.
Western Cape 1 233 796 1 214 374 98.4% 4.7% 901 363 34.
Total 8 507 553 8 318 663 97.8% 3.2% 6 180 710 34.
Between provinces, there are varying degrees of spending with the lowest being in North West at 92.6 per cent and Eastern Cape at 94.2 per cent while the highest are KwaZulu-Natal at 101.6 per cent and Gauteng at 100.1 per cent.
Housing and local government adjusted budgets at R15.1 billion comprise 5.8 per cent of total provincial adjusted budgets.
The preliminary outcome for the housing and local government sector is recorded at R15.1 billion or 99.5 per cent of the housing and local government adjusted budgets.
Mpumalanga 1 250 808 1 240 072 99.1% 6.2% 64.2% 920 871 34.
Northern Cape 400 672 397 098 99.1% 5.6% 55.2% 394 314 0.
This represents an increase of 26 per cent or R3.1 billion more than the R12 billion audited outcome in 2007/08.
98.1 per cent and Gauteng at 98.
100.8 per cent and both Eastern Cape and Western Cape at 100 per cent.
Most of the housing and local government expenditure is on the Integrated Housing and Human Settlement Development conditional grant. Table 11 indicates that provinces spent 99.1 per cent or R10.3 billion of their R10.4 billion housing conditional grant adjusted budget. These spending figures are higher by 26 per cent or R2.1 billion over the audited outcome last year.
However, a total of R322 million of the Integrated Housing and Human Settlement Development grant has been stopped by the national Department of Housing due to a lack of spending capacity within Eastern Cape (R270 million) and R52 million in North West to deal with ex-cross border projects in the Northern Cape.
The national department of Housing, after the stopping of transfers, has re-allocated funds to the value of R322 million in terms of the Integrated Housing and Human Settlement Development grant towards Gauteng, Free State, Mpumalanga and Northern Cape. These provinces' allocations have been revised upwards by R152 million, R68 million, R50 million and R52 million respectively.
Eastern Cape 981 018 981 010 100.0% 2.5% 337 423 190.
Western Cape 1 305 862 1 305 864 100.0% 5.1% 1 121 708 16.
Total 10 367 600 10 272 388 99.1% 3.9% 8 152 227 26.
The preliminary outcome for personnel (compensation of employees) is at 103 per cent or R145.5 billion of the R141.2 billion personnel adjusted budget.
100.2 per cent and 100.7 per cent respectively while KwaZulu-Natal and Free State recorded the highest rates at 105.4 per cent and 104.8 per cent respectively.
The preliminary outcome for the "payments for capital assets" category (capital), in aggregate, is at 91.1 per cent or R21 billion of the R23.1 billion capital adjusted budget. This is 23.5 per cent or R4 billion more than the R17 billion spent in the 2007/08 financial year.
Table 13 provides capital spending information by province, which indicates low rates of spending in Western Cape at 76.4 per cent and Mpumalanga at 85.3 per cent and high rates in Limpopo at 97.6 per cent and KwaZulu-Natal at 95.5 per cent. However, in absolute terms, KwaZulu-Natal has spent the most at R5.8 billion followed by Eastern Cape at R3.2 billion and Gauteng at R2.3 billion.
The biggest capital budgets in provinces are in public works, roads and transport departments at 36.8 per cent or R8.5 billion of the total provincial capital adjusted budget of R23.1 billion.
97.4 per cent or R8.3 billion which is an increase of 15.7 per cent or R1.1 billion more than the R7.2 billion audited outcome last year.
78.5 per cent and Limpopo at 90 per cent, while Gauteng and KwaZulu-Natal recorded the highest rates of spending at 156.5 per cent and 103.8 per cent respectively.
The total conditional grant adjusted allocation is R42 billion (including Schedule 4 grants and provincial roll-overs) with health making up the bulk at R14.3 billion.
Total excluding Schedule 4 grants 23 166 101 2 658 343 216 409 26 040 853 25 394 306 24 466 095 94.
Total excluding Schedule 4 grants and Gautrain 19 900 108 2 658 343 216 409 22 774 860 22 128 313 21 200 102 93.
Page 8 of 10 34.
Table 14 reflects the preliminary outcome on conditional grants for all provinces. It includes conditional grant roll-overs from the 2007/08 financial year and other provincial adjustments, but excludes spending on general purpose conditional grants (Schedule 4 grants) like National Tertiary Services, Health Professions Training and Development and the Infrastructure grant to provinces, as reporting against these grants cannot be separated from the provinces' health and capital budgets.
Preliminary expenditure outcome on the Comprehensive Agricultural Support Programme grant (also Schedule 4) is subsumed in a range of programmes and therefore no separate reporting is required in terms of the Division of Revenue Act, 2008.
Against the total adjusted allocation of R26 billion, this excludes Schedule 4 grants, the preliminary outcome of conditional grants amounts to 94 per cent or R24.5 billion. However, when excluding the Gautrain Rapid Rail Link grant, the conditional grant expenditure amounts to R21.2 billion or 93.1 per cent against the total adjusted allocation of R22.8 billion.
Specific grants that show low rates of spending include Devolution of Property Rate Funds (78.4 per cent), National School Nutrition Programme (83.5 per cent), Hospital Revitalisation (83.9 per cent) and Community Library Services (89.8 per cent).
Table 15 indicates selected conditional grant spending rates as at 31 March 2009. It further indicates that five or more provinces have spent less than 95 per cent of their grants adjusted budgets at the end of the financial year for the following grants: Community Library Services, National School Nutrition Programme and Hospital Revitalisation.
The table also indicates the number of provinces spending at slightly higher levels between 95 and 100 per cent and greater than 100 per cent of their conditional grant adjusted budgets.
Percentages represent actual expenditure of adjusted budgets as published in the Division of Revenue Act, 2008 (Act No.2 of 2008) and subsequent gazettes.
Provincial revenue includes adjusted equitable share allocations of R204 billion, conditional grants of R41.6 billion and own revenue of R9.2 billion.
99.9 per cent or R254.5 billion of total adjusted revenue of R254.8 billion.
National government transferred all or R204 billion of the equitable share and 99 per cent or R41.2 billion in conditional grants, to provinces at the end of the 2008/09 financial year.
The preliminary outcome on provincial own revenue suggests that provinces have collected R9.3 billion or 100.9 per cent of their own revenue adjusted budgets of R9.2 billion, which is 1 per cent or R97.8 million less than what was collected for the 2007/08 financial year.
The collection rate varies from 83.3 per cent in Gauteng and 94 per cent in Free State, to a high of 146.4 per cent in Mpumalanga and 117.5 per cent in North West.