DOH REVITALISATION PROGRAM EASTERN CAPE PROVINCE PRESENTATION TO SELECT COMMITTEE ON APPROPRIATIONS OCTOBER 2010
PRESENTATION OUTLINE • Background • Map of the Eastern Cape showing Hospitals under Revits Program • New St. Lucy’s Hospital completed during the 1st Quarter • Cashflow Projection of Revitalisation program for 2010/11 FY • Comments on under-expenditure • Performance and Monitoring of the Revits Grant in the 2010/11 FY • Coordination of the Revits Projects • Performance of Contractors and Consultants • Reporting and coordination between the DOH and DRPW • Capacity to implement the Hospital Revitalisation Program • Challenges and Interventions • End
1.0 BACKGROUND • 1996 NDOH undertook a facilities audit • Aim of audit to address Health Infrastructure backlog as a result of Apartheid policy • 2003/04 Health Minister launched Hospital Revitalization Programme
PURPOSE OF REVITALISATION PROGRAM To provide funding so that Provinces can: • Plan, manage, modernise, rationalise and transform infrastructure and health technology • Monitor and evaluate hospitals in line with National Health objectives • Transform Hospital management and improve quality of care in line with national policy
HEALTH STRATEGIC FRAMEWORK DOCUMENT The document aims to do the following: • Update national planning framework • Improve the condition of hospitals • Improve the condition of equipment • Decentralize hospital management • Rationalize highly specialized services.
2.0 EC REVITALISATION PROJECTS Madzikane kaZulu St Patricks St Lucy’s Dr Mpehle Frontier St Elizabeth’s Madwaleni
4.0 CASHFLOW PROJECTIONS 2010-11 Amount (mil)
5.0 COMMENTS ON UNDER-EXPENDITURE FOR THE 1st TWO QUARTERS • All projects which were under planning and procurement were stopped sometime in June 2010 (by DOH) citing budget constraints. Other projects which were in the process of being awarded were also stopped. • The second issue affecting progress is late payments . Some Contractors have terminated contracts due to late payment e.g Frontier Hospital Contractor • Some contracts are going through litigation as a result of non payment e.g The Contractor working on Grahamstown Ambulance Station served DRPW with legal demands for payments of his outstanding Invoices including interest on late payment
6.0 PERFORMANCE AND MONITORING OF REVITS GRANTS • Revitalisation Grant Budget resides with DOH and they are also responsible for paying service providers. • DRPW is responsible for technical supervision and monitoring of progress at site.
7.0 COORDINATION OF PROJECTS • DRPW has a dedicated technical team looking after the Hospital Projects including the Revits contracts. They meet and coordinate projects with their Counterparts from DOH on regular basis. • On the other hand, DRPW Director or Chief Architect usually meets with DOH Director responsible for Revites Projects on regular basis to coordinate any planning or construction related issues.
8.0 PERFORMANCE OF CONTRACTORS AND CONSULTANTS • Performance of Contractors and Consultants varies, others are very good while some are bad. For those Consultants who are not performing, DRPW has terminated their services. E.g Setkor Engineers. • On the other hand, Contractors who are not performing are also being terminated by the DRPW. E.g. Ilima Projects were terminated by DRPW for non performance at Holy Cross and Komani Hospitals
9.0 REPORTING AND COORDINATION BETWEEN DOH AND DRPW • DRPW and DOH are holding monthly monitoring meetings where all the Principal Agents are invited to give progress reports to both Departments. Reports focus on key indicators such as financial progress, time, quality of work, employment and risk issues . • Progress Reports are also prepared for management information • Coordination meetings are also held between DOH and DRPW Officials on monthly basis to discuss critical challenging issues • The two Heads of Departments also meet on quarterly basis to discuss policy issues affecting the implementation of health projects
10.0 CAPACITY TO IMPLEMENT THE HOSPITAL REVITS PROGRAM • It has been a challenge for DRPW to recruit and to retain technical staff over the years. In fact, the Department has been losing technical staff at higher rate than the rate of recruitment. • DRPW has been using Project Management Team(PMT) to beef up the capacity of the Department (DORA Clause 14 (3)(a)). The PMT contract expired at the end of June 2010.
11. CHALLENGES AND INTERVENTIONS Late issue of Project List (B6) Client Department is to issue the approved list of projects (B6) latest by the August each year to enable timeous procurement and implementation of projects Slow and lack of payment of service providers DOH to overhaul its internal payment systems Movement of Funds from contracted infrastructure projects to other programs within DOH Contracted Infrastructure Funds to be ring-fenced to ensure that cross movement of funds is avoided
11.0 CHALLENGES & INTERVENTIONS(cont.) • Non payment of interest charges Interest charges due to late payment of service providers has to be paid as it is a contractual matter in terms of JBCC clause 31.11 • Poor performance of Contractors and Consultants Underperforming Service Providers are contractually dealt with by the DRPW • Lack of Technical Capacity within DRPW Technical recruitment to be intensified including retention strategy within the Department
11.0 CHALLENGES & INTERVENTIONS(cont.) • Procurement processes within the Public Sector Procurement processes to be streamlined and be made effective and efficient • Litigations facing DRPW Contract Documents for the service providers should be signed by Client Department and Service Providers so that litigations should be directed to Client Department if they are the defaulting party when it comes to late payments • Service Delivery Agreement Accounting Officers to sign SDA. DRPW and DOH Officials to honour SDA obligations.
12. END THANK YOU ENKOSI KEA LEBOHA DANKIE