Department of Transport

1

Portfolio Committee on Transport

Quarterly Expenditure28 February 2012

• Budget for 2011/12: - Budget per Standard Item - Budget per Programme - Transfer Payment budgets

• Reporting on expenditure

• Phasing of budgets

• Overview of expenditure to 3rd Quarter

2

Contents

3

Budget per Standard Item

Standard Item Budget

R’000

%

Compensation of Employees 297,192 0.83%

Goods and Services 552,295 1.54%

Goods and Services - eNaTIS 417,640 1.17%

Machinery and Equipment 4,148 0.01%

Transfer Payments 34,496,145 96.45%

Total 35,767,420 100.00%

4

Budget per Programme

Programme Budget

R’000

%

Administration 289,669 0.81%

Integrated Transport Planning 140,478 0.39%

Rail Transport 9,542,526 26.68%

Road Transport 15,974,928 44.66%

Civil Aviation 66,002 0.18%

Maritime Transport 140,893 0.40%

Public Transport 9,612,924 26.88%

Total 35,767,420 100.00%

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Budget per Programme (continued)

Programme

(R’000)

Compen-sation of

Employees

Goods and

Services

Machinery &

Equipment

Transfer Payments

Total %

of total

budget

%

Excl. Transfers

Administration 117,072 161,116 1,958 9,523 289,669 0.81% 22.04%

Integrated Transport Planning

62,771 76,946 761 - 140,478 0.39% 11.05%

Rail Transport 11,044 14,548 61 9,516,873 9,542,526 26.68% 2.02%

Road Transport 39,707 467,325 558 15,467,338 15,974,928 44.66% 39.93%

Civil Aviation 23,114 20,213 363 22,312 66,002 0.18% 3.44%

Maritime Transport 17,228 92,494 295 30,876 140,893 0.40% 8.65%

Public Transport 26,256 137,293 152 9,449,223 9,612,924 26.88% 12.87%

Total 297,192 969,935 4,148 34,496,145 35,767,420 100.00% 100.00%

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Transfer Payment budgets

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

9,000,000

10,000,000

Passenger Rail Agency ofS.A.

S.A. National RoadsAgency

Provincial RoadsMaintenance

Public TransportInfrastructure & Systems

Public TransportOperations

Taxi Recapitalisation

Other

R’000

7

Transfer Payments Budget R'000

%

Passenger Rail Agency of S.A. (PRASA)

9,474,098 27.47%

S.A. National Roads Agency (SANRAL)

8,651,596 25.08%

Provincial Roads Maintenance 6,697,354 19.41%

Public Transport Infrastructure & Systems

4,803,347 13.92%

Public Transport Operations 4,153,232 12.04%

Taxi Recapitalisation 471,468 1.37%

Other (next slide) 245,050 0.71%

Total 34,496,145 100.00%

Transfer Payment budgets(continued)

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Other Transfers Budget (R'000) %

Road Traffic Management Corporation 77,949 31.81%

Railway Safety Regulator 37,475 15.29%

S.A. Civil Aviation Authority 15,216 6.21%

Ports Regulator 14,361 5.86%

S.A. Maritime Safety Authority 7,599 3.10%

Marine Rescue Co-Ordination Centre 5,865 2.40%

Road Traffic Infringements Agency 5,000 2.04%

Transport Education & Training Authority 197 0.08%

Rural Transport Services and Infrastructure 35,439 14.46%

S.A. National Taxi Association 21,176 8.64%

Universities 9,189 3.75%

Foreign memberships 8,845 3.61%

Gautrain Rapid Rail Link 5,300 2.16%

National Sea Rescue Institute 1,170 0.48%

Leave pay 137 0.06%

Search and Rescue organisations 132 0.05%

Total 245,050 100.00%

Transfer Payment budgets(continued)

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Transfer Payment budgets: Other transfers (continued)

Road Traffic Management Corporation Railway Safety Regulator

Rural Transport Services and Infrastructure S.A. National Taxi Association

S.A. Civil Aviation Authority Ports Regulator

Universities

S.A. Maritime Safety Authority Marine Rescue Co-Ordination Centre

Foreign memberships

Gautrain Rapid Rail Link Road Traffic Infringements Agency

National Sea Rescue Institute Transport Eduction & Training Authority

Leave pay Search and Rescue organisations

RTMC77,949 RSR

37,475 RURAL35,439 SANTACO

21,176

SACAA15,216

UNIV9,189

SAMSA7,599 MRCC

5,865

FORGN8,845

GAUTRAIN5,300

RTIA5,000 NSRI

1,170

TETA197

LEAVE137 S&R

132

PR14,361

82% 18%

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Period Details Report mainly to

Annually Annual Report (Financial Statements)

(Treasury template)

Parliament, Minister of Transport

National Treasury

Auditor-General

All stakeholders

Quarterly Interim Financial Statements

(Treasury template)

National Treasury

Auditor-General

Audit Committee

Executive Committee

Operational Planning Committee

Monthly Early Warning System

(Treasury template)

Minister of Transport

Director-General

National Treasury

Expenditure reports

(Own templates)

Executive Committee

Operational Planning Committee

Programme Managers

Sub Programme Managers

Responsibility Managers

Budget Controllers

Weekly Financial Database Access via network – any official

Reporting on expenditure

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• Expenditure is not always incurred linearly over the year.

• To enable the Department to measure expenditure against budgets, the budgets are phased over the year for specific items.

• The following phasing was done to reflect budgets against which expenditure is measured as accurately as possible:

Compensation of employees

Levels 1 to 12: 8% increase in July 2011

Levels 13 above: 8% increase in Jan. 2012

Goods and Services and Machinery & Equipment

Phased linearly over 12 months excluding eNaTIS

Transfers to Agencies Payments are made quarterly in advance

Transfers to SANRAL and PRASA

Phased linearly over 12 months

Conditional Grants Phased according to Payment Schedules

Other Transfers Phased linearly over 12 months

Phasing of budgets

12

Overview of expenditure to 3rd Quarter

• Compensation of employees

• Goods and Services

• Transfer Payments:• Conditional Grants • Transfers excluding Conditional

Grants

• Expenditure per Programme

• Utilisation of under expenditure

13

Compensation of employees per month

-10,000

-5,000

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

April May June July Aug Sept Oct Nov Dec

Expenditure Phased Budget Variance

R’000

14

0

50,000

100,000

150,000

200,000

250,000

Expenditure Phased Budget Variance

Expenditure 21,564 42,303 64,741 85,194 115,722 142,287 163,033 184,248 206,321

Phased Budget 23,688 47,376 71,063 95,960 120,857 145,753 170,650 195,547 220,444

Variance 2,124 5,073 6,322 10,766 5,135 3,466 7,617 11,299 14,123

April May June July Aug Sept Oct Nov Dec

Compensation of employees cumulative

R’000

6.4%

15

Goods and Services per month (excl. eNaTIS)

-10,000

0

10,000

20,000

30,000

40,000

50,000

60,000

April May June July Aug Sept Oct Nov Dec

Expenditure Budget Variance

R’000

16

Goods and Services cumulative (excl. eNaTIS)

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

Expenditure Budget Variance

Expenditure 14,139 42,710 71,379 114,250 146,669 169,712 219,220 239,689 295,438

Budget 46,025 92,049 138,074 184,098 230,123 276,148 322,172 368,197 414,221

Variance 31,886 49,339 66,695 69,848 83,454 106,436 102,952 128,508 118,783

April May June July Aug Sept Oct Nov Dec

R’000

28.7%

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Under expenditure on Goods and Services

Programme Expenditure Phased budget Under spent

Administration 94,301 120,836 26,535

Integrated Transport Planning (ITP) 34,753 57,709 22,956

Rail Transport 4,480 10,911 6,431

Road Transport 30,896 37,264 6,368

Civil Aviation 7,487 15,160 7,673

Maritime Transport 44,438 69,371 24,933

Public Transport 79,083 102,970 23,887

Total 295,438 414,221 118,783

Major variances:• Administration: Under spent on Office Accommodation: Difficulties to secure whole building – will save and

allocate to other priorities• ITP: National Household Travel Survey budgeted for R29,9 million only committed February 2012 – will apply for

rollover• Rail: Delays with projects: Rail Policy, Rail Act, Rail Economic Regulator• Road: Late start of S’Hamba Sonke programme – funds are committed• Civil Aviation: Outstanding claims for foreign offices and delay in establishment of Aviation Safety Investigation

Board• Maritime: Late claims for Oil Pollution and Watch Keeping services contracts• Public Transport: Delay in projects, mainly Taxi Recapitalisation 2020 Strategy, upgrade of National Land

Transport Information System and review of Bus Rapid Transport – funds reallocated to verifying infrastructure and bus subsidy expenditure in Polokwane

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Conditional Grants Cumulative

R’000

-2,000,000

0

2,000,000

4,000,000

6,000,000

8,000,000

10,000,000

12,000,000

14,000,000

Expenditure Phased Budget Variance

Expenditure 0 2,589,977 4,133,035 4,495,593 6,826,900 8,034,158 8,722,359 11,665,38911,953,154

Phased Budget 373,792 2,589,977 4,133,035 4,495,593 6,826,900 8,069,597 8,722,355 11,665,38912,144,854

Variance 373,792 0 0 0 0 35,439 -4 0 191,700

April May June July Aug Sept Oct Nov Dec

Variances:• April: Public Transport Operations Grant (bus subsidies) paid on 4 May instead of in April because payment

schedules were finalised late by Treasury• Sept: Rural Grant paid late – dispute regarding Frameworks resolved too late• December: Public Transport Infrastructure and Systems Grant payment to City of Cape Town delayed in

consultation with the City and Treasury: Funds would have been shifted to Gauteng, but Gauteng obtained approval for a rollover. The Department is in consultation with the City of Cape town and Treasury to determine whether the remaining grant must be stopped

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Transfers excl. Conditional Grants per month

R’000

-1,000,000

-500,000

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

April May June July Aug Sept Oct Nov Dec

Expenditure Phased Budget Variance

Cumulative Under/(over) spent R713m R9,6m R17,5m (R8,1m) R8,1m R54,5m R65,3m R116,2m R4,0m

April: SANRAL was paid late R721mMay to December: Agencies are paid quarterly in advanceand less taxi’s were scrapped than budgeted for

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Transfers excl. Conditional Grants (continued)

Transfers excluding Conditional Grants Expenditure to 3rd

Quarter

Phased budget

Phased variance

3rd Quarter

Phased variance

1st Quarter

Phased variance

2nd Quarter

Passenger Rail Agency of S.A. 7,105,573 7,105,574 1 1 0S.A. National Roads Agency 6,488,694 6,488,697 3 1 1

Taxi Recapitalisation 324,532 353,601 29,069 15,121 50,332Road Traffic Management Corporation 77,949 58,462 (19,487) 0 0

Railway Safety Regulator 28,106 28,106 0 1 (1)S.A. Civil Aviation Authority 13,537 11,412 (2,125) 1,125 2,252

Ports Regulator 12,021 10,771 (1,250) 1,249 2,499S.A. Maritime Safety Authority 5,699 5,699 0 0 0Marine Rescue Co-Ordination Centre 4,399 4,399 0 0 0Road Traffic Infringements Agency 3,750 3,750 0 0 0

Transport Eduction & Training Authority 0 148 148 49 99S.A. National Taxi Association 17,500 15,882 (1,618) 294 (1,412)

Universities 5,776 6,892 1,116 2,297 2,268Foreign memberships 7,520 6,634 (886) (2,814) (636)National Sea Rescue Institute 1,105 878 (227) 293 (520)Leave pay and donations 831 103 (728) (70) (421)Search and Rescue organisations 100 99 (1) 33 66

Total 14,097,092 14,101,107 4,015 17,580 54,527

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Expenditure per Programme

QUARTER 1EXPENDITURE PER PROGRAMME EXPEN- BUDGET PHASED AVAILABLE PHASED(R'000) DITURE BUDGET BUDGET VARIANCEAdministration 67,327 289,669 71,143 222,342 3,816Integrated Transport Planning 25,039 140,478 34,436 115,439 9,397Rail Transport 2,379,485 9,542,526 2,384,187 7,163,041 4,702Road Transport 3,342,451 15,974,928 3,346,085 12,632,477 3,634Civil Aviation 13,204 66,002 16,249 52,798 3,045Maritime Transport 17,265 140,893 35,036 123,628 17,771Public Transport 3,107,457 9,612,924 3,156,442 6,505,467 48,985Total 8,952,228 35,767,420 9,043,578 26,815,192 91,350

QUARTER 2EXPENDITURE PER PROGRAMME EXPEN- BUDGET PHASED AVAILABLE PHASED(R'000) DITURE BUDGET BUDGET VARIANCEAdministration 133,541 289,669 143,716 156,128 10,175Integrated Transport Planning 51,962 140,478 69,639 88,516 17,677Rail Transport 4,764,990 9,542,526 4,773,808 4,777,536 8,818Road Transport 7,243,447 15,974,928 7,286,750 8,731,481 43,303Civil Aviation 28,611 66,002 32,781 37,391 4,170Maritime Transport 45,203 140,893 70,283 95,690 25,080Public Transport 5,425,515 9,612,924 5,517,338 4,187,409 91,823Total 17,693,269 35,767,420 17,894,315 18,074,151 201,046

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Expenditure per Programme (Continued)

QUARTER 3EXPENDITURE PER PROGRAMME EXPEN- BUDGET PHASED AVAILABLE PHASED(R'000) DITURE BUDGET BUDGET VARIANCEAdministration 208,003 289,669 216,288 81,666 8,285Integrated Transport Planning 72,862 140,478 104,842 67,616 31,980Rail Transport 7,146,776 9,542,526 7,158,129 2,395,750 11,353Road Transport 11,841,251 15,974,928 11,838,815 4,133,677 (2,436)Civil Aviation 47,079 66,002 49,311 18,923 2,232Maritime Transport 74,059 140,893 105,529 66,834 31,470Public Transport 7,581,399 9,612,924 7,828,467 2,031,525 247,068Total 26,971,429 35,767,420 27,301,381 8,795,991 329,952

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Expenditure per Programme (Continued)

PROGRAMME Phased variance per Programme(R'000) Quarter 1 Quarter 2 Quarter 3Administration 3,816 10,175 8,285Integrated Transport Planning 9,397 17,677 31,980Rail Transport 4,702 8,818 11,353Road Transport 3,634 43,303 (2,436)Civil Aviation 3,045 4,170 2,232Maritime Transport 17,771 25,080 31,470Public Transport 48,985 91,823 247,068Total 91,350 201,046 329,952

Major variances:

• Administration: Under spent on Office Accommodation and over spent on Compensation of Employees as a result of restructuring. Compensation of Employees being corrected after restructuring.

• Integrated Transport Planning : Under spent on Compensation of Employees and Goods

and Services because the National Household Travel Survey that was budgeted for R29,9 million only committed February 2012 – will apply for rollover.

• Rail: Under spent on Compensation of Employees and goods and Services due to delays with projects: Rail Policy, Rail Act, Rail Economic Regulator.

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Expenditure per Programme (Continued)

PROGRAMME Phased variance per Programme(R'000) Quarter 1 Quarter 2 Quarter 3Administration 3,816 10,175 8,285Integrated Transport Planning 9,397 17,677 31,980Rail Transport 4,702 8,818 11,353Road Transport 3,634 43,303 (2,436)Civil Aviation 3,045 4,170 2,232Maritime Transport 17,771 25,080 31,470Public Transport 48,985 91,823 247,068Total 91,350 201,046 329,952

Major variances:

• Roads: Under spent on Compensation of Employees and Goods and Services due to a late start of S’Hamba Sonke programme. Over spent on transfers to Agencies because the Road Traffic Management Corporation was paid in advance.

• Civil Aviation: Under spent on Goods and Services due to outstanding claims for foreign offices and a delay in the establishment of Aviation Safety Investigation Board.

• Maritime: Under spent on Goods and Services due to late claims for Oil Pollution and Watch Keeping services contracts. Paid for Oil pollution services in January 2012.

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Expenditure per Programme (Continued)

PROGRAMME Phased variance per Programme(R'000) Quarter 1 Quarter 2 Quarter 3Administration 3,816 10,175 8,285Integrated Transport Planning 9,397 17,677 31,980Rail Transport 4,702 8,818 11,353Road Transport 3,634 43,303 (2,436)Civil Aviation 3,045 4,170 2,232Maritime Transport 17,771 25,080 31,470Public Transport 48,985 91,823 247,068Total 91,350 201,046 329,952

Major variances:

• Public Transport: Under spent on Conditional Grants because R191,7 million was withheld from the Public Transport Infrastructure and Systems Grant for Cape Town.

Under spent on Taxi scrapping R29 million because of slower scrapping than expected.

Under spent on Goods and Services R23,8 million due to delays in projects, mainly the Taxi Recapitalisation 2020 Strategy, upgrade of National Land Transport Information System and review of Bus Rapid Transport.

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Utilisation of under expenditure

Administration:• Funds will be used to upgrade the switchboard and cabling for R8 million, for a financial

model for the Information Technology Hub costing R3,3 million and for the establishment of a Project Management Unit, expected to cost R4 million in this financial year.

• Expected expenditure for consultants assisting with internal controls, procurement and strategic planning amount to R6 million for the year.

Integrated Transport Planning:• The National Household Travel Survey project will be committed at a cost of R34 million.

Savings will be shifted to this Programme where possible to enable the Department to roll over the full unexpended amount to the next financial year.

Rail Transport:• Rollovers will be requested for the Rail Policy, Rail Act and Rail Economic Regulator.

Road Transport and Civil Aviation: No under expenditure is expected.

Maritime Transport: Funds may be needed to cover expenditure of R20 million incurred in January 2012 for costs related to a ship that went aground – the cost may be recovered.

Public Transport:• Savings will be utilised to cover the cost of new projects to verify infrastructure and bus

subsidy expenditure in Polokwane. Treasury approval will be applied for to shift funds from scrapping allowances for this purpose, because the historical cost of scrapping of taxis is below the allocated budget.

Thank you

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