Briefing to Portfolio Committee on 2010/11 Annual Report Environmental Affairs

Nosipho NgcabaDirector-GeneralDepartment of Environmental Affairs7 September 2011

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Presentation Outline

- Auditor General report on the Financial Statements (Annexure A)

- Budget & Expenditure for 2010/11

- Main Adjustments to Budget

- Main Reprioritization for 2010/11

- Compensation of employees to Operations

- Current detail expenditure

- Office Accommodtion expenditure

- Transfers to public entities & revenue analysis

- Transfers to EPWP and

- Transfers to non-profit and other institutions

- Capital Expenditure

- Foreign assistance for 2010/11

- Challenges experienced for period under review

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AUDITOR GENERAL REPORT ON THE FINANCIAL STATEMENTS (Refer Annexure A)

• Unqualified Audit

• Donor funding audit for 2010/11 in progress to be finalized by end of September 2011

• Unauthorized and irregular expenditure: No unauthorized or irregular expenditure was incurred in the current year .

• Disclosure items in the financial statementsThe department complied with all disclosure requirements, classifications and policy frameworks as prescribed by Treasury.

• Transfers to agencies and other organizationsAll transfers made are per prior management approval, Treasury approval and disclosure requirements.

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Budget and Expenditure Review for 2010/11

Programme Budget 2010/11

R’000

Expenditure

R’000

Expenditure as % of Final

AppropriationR’000

1. Administration 272 231 272 231 100.0%

2. Environmental quality and protection

313 036 295 833 94.5%

3. Oceans and coastal management

166 350 166 350 100.0%

4. Climate change 569 670 489 666 86.0%

5. Biodiversity and conservation

421 974 421 974 100.0%

6. Sector services environmental awareness and international relations

745 253 743 969 99.8%

Total 2 488 514 2 390 023 96.0%

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Departmental Expenditure Trends

Year BudgetR’000

ActualR’000

% Expenditure

2004/2005 1 652 268 1 633 882 98.9%

2005/2006 1 753 307 1 746 154 99.6%

2006/2007 2 061 804 2 059 664 99.9%

2007/2008 2 790 521 2 788 757 99.9%

2008/2009 3 206 557 3 198 878 99.8%

2009/2010 3 510 641 3 503 338 99.8%

2010/2011 2 488 514 2 390 023 96.0%

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Expenditure for the 2010/2011 Financial Year per Programme

Programme Original allocation

R’000

Adjust-ments

R’000

Final appropri-

ationR’000

Expendi-ture

R’000

Variance

R’000

1. Administration 255 037 17 194 272 231 272 231 -

2. Environmental quality and protection

321 311 (8 275) 313 036 295 833 17 203

3. Oceans and coastal management 229 356 (63 006) 166 350 166 350 -

4. Climate change 573 865 (4 195) 569 670 489 666 80 004

5. Biodiversity and conservation

399 588 22 386 421 974 421 974 -

6. Sector services environmental awareness and international relations

828 637 (83 384) 745 253 743 969 1 284

Total 2 607 794 (119 280) 2 488 514 2 390 023 98 491

Expenditure per Economical ClassificationEconomical

classificationOriginal

allocationR’000

Adjust-ments

R’000

Final appropriation

R’000

Expenditure

R’000

Variance

R’000

Current Payments 910 178 (87 270) 822 908 821 785 1 123

- Compensation of employees- Goods and services

324 869

585 309

2 161

(89 431)

327 030

495 878

327 030

494 755

-

1 123

Transfers and Subsidies 1 224 337 (49 884) 1 174 453 1 162 369 12 084

- Departmental agencies and accounts- Universities and Technikons- Foreign gov. and international orgarnisations- Non-profit institutions - Households

610 883

-9 000

40 080564 374

33 398

98010 077

7 444(101 783)

644 281

98019 077

47 524462 591

644 280

98019 077

36 024462 008

1

--

11 500583

Payment for capital assets 473 279 17 480 490 759 405 475 85 284

- Software-Machinery and equipment

367472 912

23217 248

599490 160

599404 876

-85 284

Payments for financial assets

- 394 394 394 -

TOTAL 2 607 794 (119 280) 2 488 514 2 390 023 98 491

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Voted Funds Surrendered

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Main Budget Adjustments

Adjustments Notes 2010/11R’000

Transfer to DAFF for fisheries project under the Expanded Public Works Programme

(71 804)

Transfer to DAFF for compensation and operational cost for the research and protection vessels

(69 596)

Transfer from National Department of Tourism for office accommodation 10 620

Additional allocation for higher personnel remuneration increases than the main budget provided for (Adjustment per bargaining council)

8 500

Additional allocation to repair damaged engine of the SA Agulhas Polar Research Vessel

3 000

TOTAL (119 280)

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Main Reprioritization – 2010/11

Reprioritization Notes 2010/11R’000

Programme 1: Administration

Property Management & Municipal Services

41 671

Transfer to SANBI (shortfall ) 5 000

Transfer to SANParks (Management of Indigenous Forests) 12 500

GEF ( SA Membership Fees) 10 077

Environmental Awareness Greening Summit & Environment Conference 10 655

TOTAL 79 913

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Baseline Compensation to Goods and Services

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Note: Goods and Services excludes office accommodation and operational expenditure for the Antarctica and Islands programme

Compensation of Employees

• Notes on 2011/12

National Treasury increased R78 million annually for reprioritization from goods & services to compensation across the MTEF

-To fund posts created after the split,

-Occupational Service Dispensation,

-General increases,

-Funding of bonuses at the rate of 1.5% of Compensation per DPSA.

*Figures exclude Natural Resource Management Compensation & Goods and Services

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Detail Current ExpenditureNotes Expenditure

Goods and services 2010/11R’000

2009/10R’000

Administrative feesAdvertising (Environment awareness campaign emphasising Climate Change)Assets less than R5 000Bursaries employeesCatering CommunicationComputer services (Increase in specialized computer service and system development)Consultants , contractors and agency/ outsourced services (Annexure B)EntertainmentAudit cost - externalInventory (Including stores for Antarctica) — Additional trip of the SA Alguhas to Marion Islands, Fuel prize increase)Operating leases (Accommodation and photo copiers) *Owned and leasehold property expenditure (Include building maintenance) *Transport provided as part of the departmental activitiesTravel and subsistence (Annexure C)Venues and facilities (Conventions, Lekgotla, 5D, Minmec, Mintec)Training and staff developmentOther operating expenditure *

33816 347

7 7021 2582 5376 253

16 478185 543

1084 542

33 61778 96814 498

-70 22715 052

6 40234 885

4318 4745 2081 4062 9239 150

10 774147 463

2535 167

17 94586 70410 411

22972 18816 593

4 86534 781

TOTAL 494 755 434 965

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Detail Current Other Operating Expenditure *

Notes ExpenditureR’000

Other Operating Expenditure *

Professional bodies, membership and subscription feesResettlement costsCar valet & wash servicesCourier & Delivery servicesDrivers licenses & permitsPrinting & publications servicesStorage of assets & goodsAir charter services & landing rightsFreight services transport goodsHarbour services, dock fees

6 5503 311

2643

63 044

620 855

278190

TOTAL 34 885

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Office Accommodation Expenditure

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Office Accommodation Budget vs Expenditure

2006/07

R’000

2007/08

R’000

2008/09

R’000

2009/10

R’000

2010/11

R’000

Actual expenditure

Devolved allocation

33 132

31 317

38 250

35 329

42 253

38 404

75 558

43 205

88 369

48 104

Shortfall 1 806 2 921 3 849 32 353 40 265

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Note: 2010/11 includes Tourism allocation for accommodation as building was shared for the year by the two departments. Tourism contributed to the accommodation charged.

Transfers to Public Entities

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2008/09 2009/10 2010/11

SANParks 434,869 370,209 190,218

SA Weather Service 159,916 190,574 248,768

SANBI 138,831 150,886 160,830

iSimangaliso 48,701 50,658 44,365

-

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

500,000 R'00

0

SANParks & iSimangaliso: Infrastructure for world cup finalized 2010

Public Entities Financial Assistance

SANParks SAWS SANBI ISWPA

Road Subsidy;Parks Expansion;Marine & Protected Areas;Knysna Unfunded Land;Kids in Parks;Rhino reaction & protection; and management of indigenous forests

Infrastructure;Early Warning System; andAir Quality Information

Infrastructure; Climate Change Research; Scientific Authority (EDR); and Expansion of mandate

Infrastructure developmentFinancial assistanceForestry Rehabilitation

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Transfer forExpanded Public Works Projects 2010/11

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Transfer forExpanded Public Works Projects 2010/11

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Transfer forExpanded Public Works Projects 2010/11

Institutions ExpenditureR’000

2009/10

ExpenditureR’000

2010/11Sustainable land base livelihoods 195 991 186 077

Working on waste 170 182 74 753

Working for the coast 67 917 69 134

People and parks 10 602 109 001

Beneficiary training 16 253 21 320

Working for Tourism 213 546 -

2010 Tourism infrastructure development 4 475 -

Total 678 966 460 285

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Note: Reason for decrease in expenditure is due to the transfer of fishery projects to the Department of Agriculture, Forestry and Fisheries (R71 million) and tourism projects to the National Department of Tourism

Transfer to Non-Profit InstitutionsPublic Entity/Institution Final

Appropriation

R’000

Expenditure

R’000

Variance

R’000

Buyisa-e-Bag 35 000 23 500 11 500

Wildlife and Environmental Society of South Africa 4 000 4 000 -

National Association for Clean Air 1 400 1 400 -

Maloti Drakensberg 1 124 1 124 -

African World Heritage Fund 2 000 2 000 -

South Africa Local Government Association

1 000 1 000 -

DBSA: Dryland Rehabilitation 3 000 3 000 -

Total 47 524 36 024 11 500

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Institution Final Appropriation

R’000

Expenditure

R’000

Variance

R’000

Council for Scientific and Industrial Research

100 99 1

North West University 980 980 -

Global Environmental Fund 19 077 19 077 -

Social Benefit 1 690 1 690 -

Total 21 847 21 846 1

Other Transfers

Payment for Capital AssetsNotes Expenditure Roll-over

Machinery and equipment R’000 R’000

Audio visual equipmentCellular phonesComputer hardware & systemsEmergency / rescue equipmentFix individual & movable air ConditGardening EquipmentKitchen appliancesLaundry equipmentLifting & handling equipmentMedical and allied equipmentOffice equipmentOffice furniturePhotographic equipmentRadio equipmentShip & marine equipment (Replacement of polar research vessel)Telecommunication equipmentTents, flags & accessoriesExpenditure for capital assets: Goods and servicesSoftware and other intangible assets

555-

5 7118

58205720

247593761

2 70686

125393 043

833

845599

80 004

5 280

Total 405 475 85 284

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Foreign Aid Assistance

Name of Donor

Country

Purpose 2009/10R’000

2010/11R’000

UNEP 2nd National Communication for Convention and Climate Change 701 997

UNEP Rotterdam Convention 17 -

Denmark Environmental Capacity Building Programme 1 642 168

Denmark National Waste Management Strategy Programme 1 400 128

Denmark Urban Environmental Management Programme 10 397 13 923

Denmark Support for African Institute for the Environmentally Sound Management and Hazardous and other Wastes 1 000 630

Tanzania/Mauritius/Lesotho/Nigeria

Programme and Institutional Support for African Institute for the Environmentally Sound Management and Hazardous and other Wastes 344 297

World Bank African Stockpile Programme 626 516

Norway Environmental Co-operation Programme16 196 9 394

Norway Marine Fisheries Co-operation Programme 9 680 0

Kenya West Indian Oceans Fisheries 653 0

TOTAL 42 656 *26 053

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*Decrease of Donor Funding, Close up report on finalized projects to be reported the Accounting Officer

Therefore Challenges experienced by the Department during 2010/2011

- Funding entities deficits and slow own revenue generation

- Accommodation allocation shortfall

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