Making South Africa a Global Leaderin Harnessing ICTs for Socio-economic Development

PRESENTATION TO THE STANDING COMMITTEE ON APPROPRIATIONS

22 MARCH 2011

DR HAROLD WESSO: ACTING DIRECTOR GENERAL

Presentation to the Standing Committee on Appropriations (financial performance of the Department of Communications as at 31st December 2010)

Making South Africa a Global Leaderin Harnessing ICTs for Socio-economic Development

1. Introduction

Making South Africa a Global Leaderin Harnessing ICTs for Socio-economic Development

2. 2010/11 Budget vs. Exp

2010/11

Economic Classification

Adjusted Appropriation

Actual Expenditure as at 31/12/2010

Percentage spent

Current payments 502 178 226 141 45,03%

Transfers and subsidies 1 631 704 737 666 45,20%

Payments for capital assets

4 119 1 473 35,76%

TOTALTOTAL 2 138 0012 138 001 965 280965 280 45,14%45,14%

Making South Africa a Global Leaderin Harnessing ICTs for Socio-economic Development

PROGRAMME Adjusted Appropriatio

n

Actual Expenditure as at 31/12/2010

Percentage spent

Administration 159 001 104 373 65,64%

ICT International Affairs and Trade 44 618 25 332 56,77%

ICT Policy Development 102 164 47 713 46,70%

ICT Enterprise Development 1 617 992 737 896 45,60%

ICT Infrastructure Development 180 156 32 127 17,83%

Presidential National Commission 34 070 17 839 52,35%

Total 2 138 001 965 280 45,14%

2010/11 Expenditure cont.

Making South Africa a Global Leaderin Harnessing ICTs for Socio-economic Development

3. Budget vs Expenditure

Making South Africa a Global Leaderin Harnessing ICTs for Socio-economic Development

Transfer and Subsidies to SOEs

Adjusted Appropriatio

n

Approved drawings

Actual transfer as

at 31/12/2010

Reasons for underspending

ICASA 290 923 215 483 215 483 In line with drawings

NEMISA 32 602 24 452 24 452 In line with drawings

USAASA 66 704 55 297 43 499 Reasons stated below

USAF 218 613 128 568 34 339 Reasons stated below

SAPO: Subsidy 306 077 177 915 177 915 In line with drawings

SABC: Public Broadcaster

230 014 230 014 136 418 Reasons stated below

SABC: Channel Africa

38 896 29 169 29 169 In line with drawings

Sentech: Digitisation

270 900 146 000 71 000 Reasons stated below

Telkom: 2010 FIFA World Cup

150 000 0 0 In line with drawings

Total 1 538 025 1 006 898 732 275

4. 2010/11 Expenditure cont.

7A global leader in the development and use of Information and Communication Technologies for socio-economic development

Budget vs Expenditure including commitmentsBudget vs Expenditure including commitments

PROGRAMME

Budget allocation 2011/12

R’000

Expenditure as at 14 Mach

R’000

% Spent as at 14 March

Commitments + projections

R’000

Total including commitments

R’000

% Spent including commtments

1. Administration 159 001 135 994 85.5% 12 746 148 740 94%

2. ICT InternationalAffairs and Trade

44 618 33 620 75.4% 132 33 752 75.6%

3. ICT Policy Dev.-ops Transfers

80 314 51 579 64.2% 4 111 55 690 69.3%

21 850 21 000 96.1% 0 21 000 96.1%

4. ICT Enterprise Dev- ops Transfers

13 263 7 025 53% 1 910 8 935 67.4%

1 604 729 1 052 094 65.6% 222 635 1 274 729 79.4%

5. ICT Infrastructure Development - ops

112 Emergency Call Centre

Transfers

66 756 37 054 55.5% 2 143 39 197 58.7%

111 900 2 160 1.9%% 0 2 160 1.9%

1,500 1 500 100% 0 1 500 100%

6. Presidential National Commission

34 070 23 787 69.8% 2 807 26 594 78%

GRAND TOTAL 2 138 001 1 365 813 63.9% 226 484 1, 612 297 75.4%

Making South Africa a Global Leaderin Harnessing ICTs for Socio-economic Development

5. Reasons for Under spendingOn Transfers to Entities

Name of Entity

Reasons for under spending

USAASA Funds were withheld due to the lack of spending by USSASA as a result of projects not being implemented on time. The Management of USAASA has been engaged by the Department to rectify the situation.

USAF The under spending was mainly due to the delay in the finalization of the DTT standards. This matter has been finalized and the standards were pronounced by the Minister .

SABC-Public Broadcaster

Lengthy lead times on the procurement of DTT equipment and education content. The SABC has been engaged to effect improvement on their spending.

Sentech The under spending (capex & dual illumination) was caused by the delay in the DTT standards and this has now been corrected.

1. The high rate of vacancy in the Department as a result of the organisational review. The review has now been finalized and critical positions are being filled.

2. Delays in the implementation of projects due to the instability in the Department. Measures were put in place to expedite the implementation including the re-constitution of the Bid Committee including the appointment of alternate members

3. Key internal controls were put in place resulting in the slow pacing of spending, the new culture is now emerging.

Making South Africa a Global Leaderin Harnessing ICTs for Socio-economic Development

6. Reasons for Under spendingIn the Department and corrective measures

Conclusion

1. The spending has been prudently increased in the Department in compliance with the Public Finance Management Act and Treasury Regulations.

2. A culture of compliance is evident in the Department and all Responsibility Managers have been trained on Supply Chain Management and the Budget processes. This training is now a pre-requisite prior to appointment of officials as Responsibility Managers.

3. Priority projects were identified and submitted to the Bid Committee. Majority of such projects are being implemented and almost nearing completion.

Making South Africa a Global Leaderin Harnessing ICTs for Socio-economic Development