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PUBLIC WORKS LIMPOPO PROVINCE

PUBLIC WORKS LIMPOPO PROVINCE. REPORT ON DEVOLUTION OF PROPERTY RATES FUNDS (CONDITIONAL GRANT) TO SELECT COMMITTEE ON APPROPRIATIONS AND FINANCE 24 MAY 2011. PRESENTATION OUTLINE. INTRODUCTION 1.1 Project Description 1.2 Prevailing Scenario DATA ON TRENDS IN ALLOCATIONS

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PUBLIC WORKS LIMPOPO PROVINCE

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  1. PUBLIC WORKSLIMPOPO PROVINCE REPORT ON DEVOLUTION OF PROPERTY RATES FUNDS (CONDITIONAL GRANT) TO SELECT COMMITTEE ON APPROPRIATIONS AND FINANCE 24 MAY 2011

  2. PRESENTATION OUTLINE. • INTRODUCTION 1.1 Project Description 1.2 Prevailing Scenario • DATA ON TRENDS IN ALLOCATIONS 2.1 Data trends in allocations 2.2 Actual expenditure 3. TURN AROUND STRATEGY Progress

  3. INTRODUCTION • Project Description: • National Department of Public Works (NDPW) devolved rates to provincial departments of Public Works in 2008/09 financial year. • Initially the number of devolved properties in Limpopo is 3557as per submitted list. • Of these properties, the NDPW had previously paid bills s for 869 properties while the balance of 2688 properties had to be reconciled and verified. • Limpopo Department of Public Works (LDPW) received a grant of R12 million to pay the devolved rates and taxes from the National Treasury for 2008 / 2009, R13,7 million for 2009/ 2010 and a further R15,154 million for 2010/2011

  4. INTRODUCTION CONTD. • Prevailing Scenario: • Initially a decision was taken in 2001 which gave the responsibility of the payment of rent, water, electricity, rates and taxes to all provincial government departments for the properties they occupy and use. The decision is always referred to as Exco decision 59 of 2001. This decision was reversed in the 2010/11. Provincial Treasury is working on budget details for proper implementation • The Devolution of Rates Fund Grant has gone over three years now, and the LDPW took charge of the Conditional Grant on devolution of rates as opposed to other rates which are paid for by other provincial departments according to usage. • LDPW was then responsible for the payment of water, electricity, rates and taxes for properties they occupy and those that are shared by more than one department.

  5. INTRODUCTION CONTD. Prevailing Scenario: Confusion to municipalities There are provincial land parcels whose rates to municipalities are paid for by National Department of Public Works. There are provincial land parcels whose rates to municipalities are paid for by the Provincial Department of Public Works; There are also provincial land parcels whose rates to municipalities are paid for by the various Provincial Departments. 5

  6. DATA TRENDS IN ALLOCATION 2011/2012 marks the third year for the province to manage the payment of rates and taxes for devolved properties The first 2 financial years were difficult because the Department did not receive bills for all properties that were on the list from NDPW. After extensive interactions with municipalities in the 2010/11 financial year, the Department received bills for more properties from municipalities that resulted in expenditure of R 14,730m (97,2%) 6

  7. DATA TRENDS IN ALLOCATION 7

  8. PROGRESS TO DATE CONTINUED • Expenditure for the 3rd Quarter was slightly below the straight-line projections at 74%, but there were bills that were being verified. • LDPW has in the 2010/11 financial year expended the budget that was allocated for and devolved rates. The department has also requested for additional funding from both provincial treasury for normal rates and NDPW for devolved rates, whilst NDPW has doubled the allocation of devolved rates form R15,4m to R34,4m in the 2011/12

  9. EXPENDITURE • Department has in the previous financial years reported 55.74% expenditure in 2008/9 and 37.7 % in 2009/10 respectively and in 2010/11 it has spent 97% • The Department had received bills that exceeded the allocated budget of R 15,154 mil and unpaid accounts are planned to be paid over in the 1st quarter of 2011/12 from the current allocation.

  10. TURN AROUND STRATEGY • Progress: • The Department developed a plan in the 2009/2010 financial year that involved all stakeholders to improve payments to municipalities. • The performance of the 2010/2011 financial year indicates that the plan is working. The active role of the NDPW, Provincial Treasury, DLGH and Salga has contributed to the improvement

  11. 4. CONCLUSION. • In conclusion, it is hoped that interaction with these stake holders will continue to improve the relationships that will lead to a better service delivery and enable the partners to have a harmonious understanding to create a platform conducive to good governance. THANK YOU

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