Finance and Economic Opportunities
With regard to provincial government departments’ expenditure of conditional grants during the period between 2014/15 and 2020/21:
- (a)(i) Which conditional grants’ spending were below 50% and (ii) why, (b) what are the details and names of the (i) grants, (ii) departments and/or (iii) municipalities that underspent, (c) what are the (i) conditions attached to each grant, (ii) nature of the project and (iii) reasons for underspending, (d) what are the details of actions taken by the Provincial Treasury during and after underspending was identified and (e) what improvements have been realised after the interventions;
- whether there are any methods outside the WCPP’s standing committees and plenary sittings through which the Provincial Treasury enable and effect public involvement in the provincial budget processes; if not, why not; if so, what are the relevant details?
- [a][i] There were two conditional grants allocated to provincial departments that spent below 50 per cent within the period 2014/15 to 2020/21. These were the Provincial Emergency Housing Grant, where under-spending occurred at the end of the 2018/19 and 2020/21 financial years, and the Maths, Science and Technology Grant, which occurred at the end of the 2020/21 financial year.
[ii] This information is publicly available in the relevant departments’ Annual Financial Statements – 2014/15 to 2019/20.
[b][i] This information is publicly available in the relevant departments’ Annual Financial Statements – 2014/15 to 2019/20.
[ii] This information is publicly available in the relevant departments’ Annual Financial Statements – 2014/15 to 2019/20.
[c][i] The conditions of the conditional grants, identified as spending below 50 per cent, can be found within the conditional grant frameworks of the Division of Revenue Bill, 2018 and 2020.
[ii] Nature of Grant: Provincial Emergency Housing Grant – This funding has been allocated as a schedule 7, Part A i.e. Allocations made to provinces for immediate disaster response, while the Maths, Science and Technology Grant has been allocated as a schedule 5, Part A i.e. Allocations made to provinces for a specific purpose.
[iii] This information is publicly available in the relevant departments’ Annual Financial Statements – 2014/15 to 2019/20. The 202/21 information has not yet been finalised.
[d] Regards the Provincial Emergency Housing Grant, it should be noted that due to the timing of this allocation being made available to the province by National Treasury in terms of the Division of Revenue Act [that is; in March at the end of the financial year which culminated into a special provincial adjusted budget process], the Department of Human Settlements is not in position to secure and finalise the procurement process and spending of these funds in the same financial year. The action taken by Provincial Treasury was to ensure and facilitate that the unspent funds are requested as a rollover and met the rules and regulations of roll overs in terms of National Treasury prescripts, for National Treasury’s review and consideration.
Regarding the Maths, Science and Technology Grant, considering that it is the first time this grant has spent below 50 per cent as well as occurring at the end of the 2020/21 financial year, the action taken by Provincial Treasury was to facilitate the application for the rollover of unspent funds to be made in terms of relevant regulations and in terms of National Treasury Regulations and the Division of Revenue Act, for National Treasury’s review and consideration.
[e] Given that only two grants have been spent below 50 per cent in the 2018/19 and 2020/21 financial year, and noting the reasons for the underspending and nature of the Provincial Emergency Housing Grant, no interventions were deemed necessary especially as there is also no history of other grants spending below 50 per cent for the period 2014/15 to 2020/21.
- The provincial government utilises multiple direct and indirect methods to encourage and enable public engagement in each phase of the budget process:
Discussions on the Provincial Economic Review and Outlook and the Municipal Economic Review and Outlook
The Provincial Economic Review and Outlook [PERO], and the Municipal Economic Review and Outlook [MERO] are published at the outset of the budget process. These documents provide the critical economic and socio-economic intelligence that informs responsive and data-led policy, planning and budgeting in the Western Cape. Post the tabling of the PERO and MERO in September/ October each year, these documents are circulated to municipalities and workshopped through the District Committee Forum platforms, and on request from individual municipalities.
This is complemented by the Joint District and Metro Approach [JDMA] that, since 2019/20, has indirectly facilitated public participation in the provincial government budget process. The JDMA, is a geographical, district and team-based, citizen focused approach to provide government services for citizens, promotes the interdepartmental and intergovernmental interfaces using District Co-ordinating Forums for co-planning, co-budgeting and co-implementation to translate into service delivery to communities.
These engagements provide key external inputs into the Western Cape Government’s Adjusted Budget, Medium-Term Budget Policy Statement [MTBPS] and the Preliminary MTEF allocations, which are also communicated widely via social and mass media.
Sectoral and facility level engagements
Various sectoral engagements are held at community level by individual departments to discuss community priorities and plans. For instance, the Department of Human Settlements regularly engages communities on plans for human settlements development. In the education sector, School Governing Bodies are required by the South African Schools Act, to prepare and discuss annual school budgets with a quorate parent body, who must vote to approve the school budget, which is either partially or entirely funded by the provincial government.
Expenditure oversight
The allocation of resources through the budget process is one aspect of the overall expenditure management cycle that also includes opportunities for community oversight of expenditure progress and performance. During COVID-19, the Western Cape Government introduced regular public reporting on COVID-19 procurement through the monthly and quarterly Procurement Disclosure Reports.
