Gauteng Department of Agriculture 2023 Budget Allocation & Performance Report
The document outlines the budget allocation and performance report for the Gauteng Department of Agriculture and Rural Development for the 2023 Medium-Term Expenditure Framework (MTEF). It includes details on budget projections per program, financial performance, revenue collected, and payments made. The report also covers economic classifications and highlights shifts and virements in financial allocations.
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GAUTENG DEPARTMENT OF AGRICULTURE AND RURAL DEVELOPMENT AND ENVIROMENT 2023 MTEF Budget Allocation, 4th Quarter Performance Report PORTFOLIO COMMITTEE 11 MAY 2023
Table of contents MTEF BUDGET PROJECTION PER PROGRAMME MTEF BUDGET FOR CONDITIONAL GRANT QUARTER 4 FINANCIAL PERFORMANCE REPORT APPROVED YEAR END SHIFTS AND VIREMENTS REVENUE COLLECTED AS AT 31 MARCH 2023 PAYMENT OF INVOICES 2
MTEF BUDGET PROJECTION PER PROGRAMME
2023 MTEF BUDGET PROJECTION PER PROGRAMME 2022/23 2023/24 2024/25 2025/26 Amount Increase/ Decrease % Amount Increase/ Decrease % Amount Increase/ Decrease % Adjusted Appropriation Revised Baseline Increase/ Decrease Revised Baseline Increase/ Decrease Planning baseline Increase/ Decrease PROGRAMMES R'000 R'000 275 960 R'000 R'000 R'000 R'000 295 750 R'000 13 103 280 945 (4 985) -2% 282 647 6 687 2% 5% ADMINISTRATION AGRICULTURE AND RURAL DEVELOPMENT ENVIRONMENTAL AFFAIRS Total for Programmes 494 360 295 884 1 066 204 502 891 322 156 520 496 346 738 1 162 984 498 930 (4 570) -1% 8 531 2% 17 605 4% 24 582 55 290 345 631 (49 747) -14% 26 272 9% 8% 1 125 506 (59 302) -5% 1 107 694 41 490 4% 5% 4
5 2023 MTEF BUDGET - FINANCIAL PROJECTION PER ECONOMIC CLASSIFICATION 2022/23 2023/24 2024/25 2025/26 % Incre ase/ Decr ease Amount Increase /Decrea se R'000 597 419 24 846 467 322 Amount Increase /Decrea se R'000 618 768 21 349 485 131 17 809 Amount Increase/ Decrease R'000 % Increase/ Decrease % Increase/ Decrease Economic classification Main Revised Baseline R'000 Planning Baseline R'000 Planning Baseline R'000 Appropriation R'000 Compensation of employees Goods and services Transfers and subsidies Payments for capital assets Payments for Financial assets Total economic classification 591 093 572 573 (18 520) -3% 4% 4% 483 125 468 170 (14 955) -3% (848) 0% 4% 11 037 9 831 (1 206) -11% 10 548 717 7% 11 021 473 4% 32 405 16 775 48 064 15 659 48% 40 024 15 630 (24 394) -61% 107% 227 - - - - - - - - - 1 107 694 41 490 1 162 984 55 290 1 125 506 1 066 204 (59 302) -5% 4% 5% 5
GDARDE - BUDGET PER ECONOMIC CLASIFICATION 2023/24 Compensation of Employees (CoE) The Department CoE Budget decreased with -3% in 2023/24 and increased by 4% for the 2024/25 financial years from R572 million to R618 million from the 2024/25 to the 2025/26 financial year. During the 2022-2023 Adjustment Budget the Department received an additional Budget of R39 million for CoE, the allocation was as follows: 3% wage increase - R 16 436 340, 1.5% notch Progression (9 months) including SMS projection - R3 818 392, Critical Posts and Shortfall on COE - R19 000 268. The main reason for the decrease can be attributed to critical posts not filled after the adjustment budget process. 6
GDARDE - BUDGET PER ECONOMIC CLASIFICATION 2023/24 Goods and Services (G&S) The Department G&S Budget decreased with -3% (-R15 million) from R483 million to R468 million from the 2022/23 to the 2023/24 financial year and 0% from (-R848 thousand) . The Department reprioritisation of funds from non-essential items such as catering, advertising, training, travelling expenses, venues and facilities to priority areas. The decrease in G&S can be attributed to the Roll over request for the 2021-2022 FY allocated during the 2022-2023 FY amounting to R29 million relates to equitable share good and services and R17 million for conditional grants. The reprioritisation of fund to support key priorities is insufficient and will not be able to fully deliver on the set targets. R543 million required for Prioritised Plans and programmes in response to the elevated area of focus, R468 million Budget allocated for Good and service for the 2023-2024 Financial year, shortfall of R75 million. An additional Budget of R606 million is required as presented to the PBC in November 2022. PBC responded that No additional Budget will be allocated to the department, these elevated project must be funded internally. 7
GDARDE - BUDGET PER ECONOMIC CLASIFICATION 2022/23 Transfers and Subsidies (T&S) The department T&S Budget decreased form R11 million to 9,8 million with -11% (R1,2 million) and increase with 7% and 4% from R10,5 million to R11 million from the 2024/25 to he 2025/26 financial year. Payments for Capital Assets The Department Capital Budget decreased with -61% from R40 million to R15,6 million from the 2022/23 to the 2023/24 financial year due to the lack of readiness of the Department to implement infrastructure projects. 8
MTEF BUDGET FOR CONDITIONAL GRANTS
10 2023 MTEF BUDGET CONDITIONAL GRANTS SUMMARY OF DEPARTMENTAL CONDITIONAL GRANTS 2022/23 2023/24 2024/25 2025/26 Amount Increase/ Decrease R'000 % Amount Increase/ Decrease R'000 % Amount Increase/ Decrease R'000 % Conditional Grants Name Main Revised Baseline R'000 Increase/ Decrease Indicative Baseline R'000 Increase/ Decrease Planning baseline R'000 Increase/ Decrease Appropriation R'000 % % % Comprehensive Agricultural Support Programme Grant 121 145 103 014 (18 131) -15% 107 641 4 627 4% 112 463 4 822 4% Ilima/Letsema Projects Grant Land Care Programme Grant: Poverty Relief and Infrastructure Development 37 262 37 885 623 2% 39 587 1 702 4% 41 361 1 774 4% 5 219 5 360 141 3% 5 501 141 3% 5 748 247 4% 163 626 146 259 17 367 11% 152 729 6 470 4% 159 572 6 843 4% Total Expanded Public Works Programme Incentive Grant for Provinces Total Conditional grants 3 355 3 621 266 0 - - - - - 166 981 149 880 17 633 11% 152 729 6 470 4% 159 572 6 843 4% 10
QUARTER 4 FINANCIAL PERFORMANCE AS AT 31 MARCH 2023
BUDGET VS EXPENDITURE AS AT 31st of March 2023 Projected Budget for the Quarter under review Actual Expenditure for the Q4 Under review Percentage Expenditure for the Q4 Under review Variance for the Q4 Under review Actual Expenditure (Year to Date) Adjusted Appropriation Programme Variance % spent Programme 1: Administration 62,266 68,170 - 5,904 109% 280,945 290,570 - 9,625 103% Programme 2: Agriculture and Rural development 115,278 156,574 - 41,296 136% 498,930 388,644 110,286 78% Programme 3: Environmental Affairs 67,975 104,742 - 36,767 154% 345,631 331,789 13,842 96% TOTAL 245,519 329,486 - 83,967 134% 1,125,506 1,011,003 114,503 90% ECONOMIC CLASSIFICATION Compensation of Employees 136,963 139,937 - 2,974 102% 591,093 561,887 29,206 95% Goods and Services 106,178 181,728 - 75,550 171% 483,125 422,375 60,750 87% Transfers and Subsidies 457 4,619 - 4,162 1011% 11,037 8,780 2,257 80% Payments for Capital Assets 1,921 3,202 -1,281 167% 40,024 17,627 22,397 44% Payments for Financial Assets - - - 227 334 -107 TOTAL 245,519 329,486 -83,967 134% 1,125,506 1,011,003 114,503 90%
BRIEF SUMMARY OF THE UNDER/OVER EXPENDITURE PER PROGRAMME 4th Quarter Target Progress: The department projected expenditure is R245 million, spent R329 million which equates to 134% in the fourthquarter. Expenditure to Date: - The Department s total allocated adjusted budget is R1 125 billion. Overall, the department has spent R1 011 billion which is equivalent to 90% of its total allocated budget for the 2022/23 Financial Year. - Administration (Programme 1) has spent R290 million that is equivalent to 103% of its allocated budget. This will be corrected during Financial year end shift and Virement. - Agriculture and Rural Development (Programme 2) has spent R389 million that is equivalent to 78% of its allocated budget - Environmental Affairs (Programme 3) has spent R332 million that is equivalent to 96% of its adjusted budget 1 3
BRIEF SUMMARY OF THE UNDER/OVER EXPENDITURE PER ECONOMIC CLASSIFICATION Compensation of Employees: 4th Quarter Target Progress: The department projected expenditure for the 4th quarter is R136 million, spent R139 million which is equates to 102% in the fourth quarter. Expenditure to Date: The department has spent R562 million of its R591 million allocated adjusted budget, which is equivalent to 95% of its allocation. The underspending can be attributed to SMS notch progression not yet paid, vacancies at Financial year end not filled. The Department did not fill its critical posts created on the new proposed organisational structure, the new organisation structure is reviewed before the Adjustment Budget but was not approved by the MEC to be implemented. The additional budget allocated during the Adjustment Budget to fill these critical posts amount to R19 million and could not be spent. 1 4
BRIEF SUMMARY OF THE UNDER/OVER EXPENDITURE PER ECONOMIC CLASSIFICATION Goods and Services: 4th Quarter Target Progress: The Department projected expenditure for 4th quarter is R106 million, spent R181 million which is equates to 171% in the fourth quarter. The 34% over expenditure recorded in the 4th Quarter can be attributed to the delivery of goods and service increased, and project finalised in the 4th quarter of the 2022-2023 FY. Expenditure to Date: The Department has spent R422 million of its R483 million allocated adjusted budget that is equivalent to 87% of its allocation. Underspending can be attributed to procurement process finalised, but delivery of good and services could not be finalised at financial year end, the main underspending was for Conditional Grant projects under Famer Support and Development relating to good and services (R56,9 million underspending) and machinery and equipment (R8 million underspending). 1 5
BRIEF SUMMARY OF THE UNDER/OVER EXPENDITURE PER ECONOMIC CLASSIFICATION Expenditure to Date: Procurement done for Research and Technology Development Services was finalised, but delivery could not take place because equipment procured needed to be imported and could not be delivered at financial year end (R8,1 million). Previously reported reasons for the under expenditure also contributed to the Department ability to spend all its allocated budget for the 2022-2023 Financial year. These were impacted by the Constitutional Court judgment regarding preferential procurement regulations of 2017 on procurement. The CASP and Ilima/Letsema conditional grants first tranche payments were received on 22nd August 2022. Land Care Grant was only approved in November 2022. The Department will apply for a Roll over request for the already committed funds. 1 6
TRANSFERS 31st of March 2023 Adjusted Budget Balance % Expenditure Transfers R'000 R'000 R'000 923 267 656 29% Provinces and Municipalities Departmental agencies and accounts 1,322 1,324 -2 100% 6,985 5,700 1,285 82% Higher education institutions 1,807 1,489 318 82% Households 11,037 8,780 2,257 80% Total 1 7
BRIEF SUMMARY OF THE UNDER/OVER EXPENDITURE PER ECONOMIC CLASSIFICATION Transfers and Subsidies: 4th Quarter Target Progress: The department projected expenditure for the 4th quarter is R457 thousand, spent R4 million which equates to 1011% in the fourth quarter. Transfers to higher education were processed in the fourth quarter Expenditure to Date: The department has spent R9 million of its adjusted budget of R11 million which is equivalent to 80% of its allocation. The Transfers to higher education for bursaries and internships were delayed because of the signing of the MOA by Universities. All transfers to higher education were processed. 18
INFRASTRUCTURE EXPENDITURE 31st of March 2023 Adjusted Budget Balance % Expenditure Infrastructure R'000 R'000 R'000 7,948 3,999 3,949 50% Upgrade and additions Building & other fixed structures 7,948 3,999 3,949 50% 310 - 310 0% Maintenance and Repairs Internal Capacity Building Programme 18,307 15,589 2,718 85% 26,565 19,588 6,977 74% Total 19
BRIEF SUMMARY OF THE UNDER/OVER EXPENDITURE PER ECONOMIC CLASSIFICATION Payments for Capital Assets: 4th Quarter Target Progress: The Department projected expenditure for 4th quarter is R2 million, spent R3 million which is equates to 167% in the third quarter. Expenditure to Date: The Department has spent R18 million on its adjusted budget of R40 million which is equivalent to 40% of its allocation. R4 million was spent on construction of fence project, R2 million on tractor and motor vehicle and R8 million was spent on purchasing of desktops and desktop printing equipment. The main under expenditure was for Conditional Grant projects under Famer Support and development relating to machinery and equipment (R8 million underspending), the procurement process was finalised, but delivery of machinery (Tractors and Vehicles) could not be finalised at financial year end.
BRIEF SUMMARY OF THE UNDER/OVER EXPENDITURE PER ECONOMIC CLASSIFICATION Payments for Capital Assets: Infrastructure The Department has spent R23 million on its R26 million adjusted budget, which is equivalent to 88.5% of its adjusted budget allocation. R5 million was spent on construction of fence at Abe bailey and Suikerbosrand, and R14 million was for compensation and goods and services. Biodiversity Management also incurred under expenditure relating to building and other fix structures amounting to R5 million for infrastructure project not finalised by the Department Implementing Agent (DBSA) at financial year end.
GDARD CONDITIONAL GRANTS 31st of March 2023 Adjusted Budget Balance % Expenditure Conditional Grants R'000 R'000 R'000 90,725 33,693 57,032 37% CASP: Infrastructure 30,420 10,795 19,625 35% CASP: ERP 121,145 37,262 44,488 37,100 76,657 162 37% 100% Total CASP Illima/Letsema 5,219 5,219 0% Land Care 3,355 3,355 - 100% EPWP: incentive grant 166,981 84,943 82,038 51% Total 22
BRIEF SUMMARY OF THE UNDER/OVER EXPENDITURE CONDITIONAL GRANTS 4th Quarter Target Progress: Expenditure to Date: The Department has spent R100 million of its R166 million adjusted budget, which is equivalent to 60% of its conditional grants adjusted allocation. The following factors reported previously did impact the Department ability to deliver on it targets and to ensure that a 100% is spent on conditional Grant Budget. The CASP and Illima/Letsema business plans were approved very late in the financial year. Tenders were nonresponsive. The department only received its first tranche payment for CASP on 22nd August 2022. Land Care Grant Business Plan was approved only in November 2022. Not all these commitments could be finalised at financial year end. The Department will apply for a Roll over request for Conditional Grants. 23
APPROVED YEAR END SHIFTS AND VIREMENTS 2022/23 FY
GDARDE YEAR- END SHIFTS AND VIREMENTS FOR 2022/23 FINANCIAL YEAR BUDGET AVAILABLE AFTER PROPOSED SHIFTS AND VIREMENTS EXPENDINTURE AS AT 31 MARCH 2023 ADJUSTED BUDGET AVAILABLE BUDGET VIREMENTS TO FINAL APPROPRIATION % SPENT PROGRAMMES % SPENT SHIFTS TO ADMINISTRATION AGRICULTURE&RURAL DEVELOPMNT 280 945 000 290 569 897 -9 624 897 103% 0 10 300 000 291 245 000 675 103 100% 498 930 000 388 492 593 110 437 407 78% 0 -19 000 000 479 930 000 91 437 407 81% ENVIRONMENTAL AFFAIRS AGRICULTURE & RURAL DEVELOPMENT 345 631 000 331 789 416 13 841 584 96% 0 8 700 000 354 331 000 22 541 584 94% 1 125 506 000 1 010 851 906 114 654 094 90% 0 0 1 125 506 000 114 654 094 90% ECONOMIC CLASSIFICATION COMPENSATION OF EMPLOYEES 591 093 000 561 887 523 29 205 477 95% 0 0 591 093 000 29 205 477 95% GOODS AND SERVICES PROVINCIAL AND LOCAL GOVERNMENTS DEPARTMENTAL AGENCIES & ACCOUNTS HIGHER EDUCATION&TRAINING INSTIT 483 125 000 422 222 888 60 902 112 87% -8 209 000 0 474 916 000 52 693 112 89% 923 000 268 095 654 905 29% 0 0 923 000 654 905 29% 1 322 000 1 323 620 -1 620 100% 0 0 1 322 000 -1 620 100% 6 985 000 5 700 000 1 285 000 82% 0 0 6 985 000 1 285 000 82% HOUSEHOLDS (HH) 1 807 000 1 489 692 317 308 82% 102 000 0 1 909 000 419 308 78% BUILDINGS & OTHER FIX STRUCT 10 889 000 5 618 178 5 270 822 52% 0 0 10 889 000 5 270 822 52% MACHINERY AND EQUIPMENT 29 135 000 12 007 534 17 127 466 41% 8 000 000 0 37 135 000 25 127 466 32% PAYMENTS FOR FINANCIAL ASSET 227 000 334 375 -107 375 147% 107 000 0 334 000 -375 100% ECONOMIC CLASSIFICATION 1 125 506 000 1 010 851 906 114 654 094 90% 0 1 125 506 000 114 654 094 90%
REVENUE COLLECTED AS AT 31 MARCH 2023
DEPARTMENTAL REVENUE ANALYSIS 31st of March 2023 REVENUE AS AT 31st of March 2023 TOTAL REVENUE APPROPRIATED REVENUE DETAILS BUDGETED AMOUNT ACTUAL COLLECTED VARIANCE TOTAL ANNUAL APPROPRIATED ACTUAL COLLECTED VARIANCE COLLECTED % R 000 R 000 R 000 R 000 R 000 R 000 Sales of goods and services other than capital assets 433 4 238 (3 805) 10 946 14 751 (3 805) 134,7% Fines, penalties and forfeit Interest, dividends and rent on land 0 1 406 (1 406) 3 710 10 360 (6 650) 279,2% 8 0 8 8 0 8 0% Sales of capital assets Financial transactions in assets and liabilities 0 0 0 0 13 (13) 100% 12 (10) 2 303 281 22 92,7% TOTAL 453 5 634 (5 181) 14 967 25 405 (10 438) 169,7% 27
DEPARTMENTAL REVENUE ANALYSIS 31st of March 2023 The Department collected R 25,405 million as at end of 31st March 2023. The Department collected (R10,438 million) 69,7% more than the projected revenue of R14,967 million for 2022/2023 financial period. The Department received payments of section 24G fines issued in current and previous years in an amount of R10,360 million, this is an overcollection of 179,2% (R6,650 million) for 2022/23. The collection on Sales of goods & services relates to Veterinary services, permits (import and export), EIA and Nature Reserves entrance fees. The Department over collected on this Item by 34,7% as at end of 2022/23. Financial transactions in assets and liabilities, the transactions relates to salary reversals from previous financial year, withdrawals from Revenue Fund to clear the debt created against payments received, refund from Microsoft license for previous financial year and the approved Debt write-offs of deceased employees. The Department collected 92,7% of the projected revenue as at end of 2022/23. 28
PAYMENT OF INVOICES WITHIN 10 15 3O AS AT 31 MARCH 2023
10-, 15- AND 30-DAY PAYMENT REPORT - 2022/2023 Apr-22 May-22 Jun-22 Jul-22 Aug-22 Sep-22 Oct-22 Nov-22 Dec-22 Jan-23 Feb-23 Mar-23 89% 82% 85% 81% 89% 99% 100% 99% 100% 96% 99% 98% 93% 95% 100% 100% 100% 100% 100% 100% 100% 100% 96% 100% 98% 99% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% TOTAL 30
REASON FOR DEVIATION - 10 DAY PAYMENTS The Department managed to pay 98% of the invoice within 10 and 15 days and 100% in 30days for the month of March 2023. The reason for invoices exceeding 10 and 15 days can be attributed to the following reasons: There were disbursement challenges (system problems) from the 1st of March and were only resolved on the 8th of March and Invoices were processed on the 13th of March 2023 and could not be posted due to technical issue reported by E-GOV, this could only be posted on the 20th of March resulting in invoice exceeding the 10 and 15 days. Mitigations: The Department does not have any control over system problems been manage by E- Gov. The Payment section will continue to follow up with E-Gov to raise any system related challenges as they occur. 31
