TUESDAY, 18 APRIL 2023 11H00
The North West Provincial Executive Committee (EXCO) recently held its meetingto reflect on reportsit received from EXCOClustersas part of enhancingthe work of the Provincial Government.The provisioning of service delivery by government departments remains our core business.
One of the critical developments that have emerged from this EXCOmeeting is that the North West Province will host the National Freedom Day celebration on the 27thof April 2023 at Manzil Parkstadium in Matlosana Local Municipality.
This event will be led by President Cyril Ramaphosa tomark the 29thanniversary of South Africa’s first democratic elections.4000 citizensfrom across the 4 Districtswill attend this historic eventand other citizens of the province and the country will follow the event on various media platforms.As a province we are ready to host this event and there are build up activities that havebeenplanned as part of raising awareness amongst citizens.
This is indeed a significant development in that only last month our province hosted the World TB Day in Tlhabaneas well as the World Consumer Rights Day at the Sun City Resort.
The province also hosted the 2ndAnnualMining and Energy Investment Conference which was held at Sun Cityon 29 and 30 March 2023. This conference is aimed at luring investmentsin the province and create various socio-economic opportunities for the people of North West.
As part of ongoing efforts to improveAgricultureasone of the key economic drivers inthe province we will behostingthe General Assembly of the World Farmers’Organisation at Sun City on 21 to 24 May 2023
Hosting these three national events in such ashort space of time represents a vote of confidence on the ability of the North West to host major national events of this magnitudesuccessfully.Thetwolatterevents we hosted invariably had positive spin offs on the hospitalityindustry and benefittedSMMEs.
Progress on interventions in Municipalities
Several municipalities in the province are experiencing challenges that impact on their ability to render services to the citizens.
In November 2021, EXCOresolvedto place the followingeight municipalities under mandatory intervention in line with section 139(5) (a) and (c) of the Constitution read together with section139 of the Municipal Finance Management Act (MFMA):
o Naledi Local Municipality
o Dr Ruth Segomotsi Mompati District Municipality
o Madibeng Local Municipality
o Kgetlengrivier Local Municipality
o Ramotshere Moiloa Local Municipality
o Tswaing Local Municipality
o Ditsobotla Local Municipality
o Mahikeng Local Municipality
The ProvincialGovernment has,in implementing the mandatory intervention,adopted the following principles to ensure that all affected stakeholders understand and fully embrace the intervention:
• Role player engagement and activation process
• Strengthening the Municipal Finance Recovery Service
• Transparency and Participation
The Provincial Treasury, COGTA and SALGA held sustained engagements with affected municipalities in July 2021 as well as in November 2021, with the then newlyelected Municipal Councils.
It was during theseengagements thatMayors of municipalities were taken through the outcome of an assessment conducted in line with the provisions of Section 138, 139 and 140 of the MFMA which determines the criteria for a municipality in financial crisis and the mandatory intervention framework.
In preparation for the implementation of the mandatory intervention,the Provincial Government,National Treasury and National COGTA convened a role-player engagement and activatedconsultation sessions in April and May 2022, wherethe affectedmunicipal councils andsenior officials were consulted tobuild awareness on the requirements of Section 139 of the Constitution and Chapter 13 of the MFMA.
Furthermore,when there is a financial crisisin any municipality, Section 139(5) of the Constitution requires that the Provincial EXCOmust impose arecovery plan.The findings of the status quo assessment will be used to prepare an appropriate recovery plan.
The Provincial Executive Representative (PER) wasappointed to oversee the implementation of the financial recovery planatthe affectedmunicipalities. The Provincial Treasury will place the PER at each municipality to lead the implementation of the financial recovery plan.
A Panel of Municipal Financial Recovery Services has been established to support thePER in the execution of his/her functions at these municipalities.
The successful implementation of municipal interventions is underpinned by good cooperation by all key stakeholders, National Treasury, Provincial Treasury, COGTA –National Provincial Departments and South AfricanLocal Government Association.
The EXCOhasagreed that additional resources must be appointed for the following pillars to overseethe day-to-day operations of the municipality to give effect to theimplementation of the financial recoveryplan:
• Institutional Capacity Expert
• Legal Experts
• Service Delivery Experts (Including Engineers)
All these efforts are undertaken to stabilisethe affectedmunicipalitiesand ensure that they caneffectively render the much-neededservicesto the publicandtosustain this stability in the long term.
Progress on work done by government for MilitaryVeterans
EXCOreceivedandendorsed aprogressreport on work done by government for Military Veterans.The report includes the following efforts by the provincial government:
• Military Veterans owned companies that are benefitting from procurementopportunities in government.
• Provision of social services to Military Veterans.
• Appointment of a contractor to commence with a housing project that targets 88Military Veterans.
• Delivery of layers, broilers and goatstoMilitary Veteransprojects
• Implementation of land development support project
• Inclusion of Military Veterans into health-relatedgovernance structures
North West Transport Investment(NTI)
The NTI matteris before the court of law and on this basis,government is limited in discussing it except to confirm that we are confident as government that we have a strong casethat we are defending and we believe thatthe courtwill rule in our favour.
Provincial Preliminary Revenue and Expenditure for the period ended 31stMarch 2023
The aggregate preliminary expenditure of the province as at end of March 2023 amounts to R49.870 billion or 96.42 per cent of the R51.722 billion adjusted appropriation. All provincial departments recorded expenditure above 90 per cent and eight (8) recorded expenditureabove 95 per cent which contributed to the departmental spending improvements compared to the same period last financial year.
Resultantly, the preliminary under-expenditure as at end of the2022/23 financial year amounts to R1.852 billion or 3.58 per cent. Of the R1.852 billion, unspent conditional grants amount to R1.015billion and the equitable share accounts for the remainder of the under-expenditure which is R849.390 million. The breakdown of unspent conditional grants is as follows: Health -R302 million; Education –R383 million; Public Works and Roads –R227 million, Agriculture and Rural Development –R64million; Arts, Culture, Sports and Recreation –R32 million and Human Settlements –R7.5 million.
In line with Section 21 of the Division ofRevenue Act (DoRA) No 5 of 2022, the R1.0015unspent conditional grant funds would be subjected to the rollover processes. The above-mentionedprovisions of the DoRA provides the departments with an opportunity to submit request for rollover to committed identifiable projects. The Province has already commenced with this process and the departments are expected to submit such requests by end of April 2023 for consideration by the transferring accounting officers of the national departments and National Treasury prior to the adjustment budget processes which is normally tabled in October/November each year.
In terms of DoRA read together with thePFMA,approved rollover requests which process isapplicable in all Provinces including national departments, unspent conditional grant funds would only revertto the National Revenue Fund post finalisation of this critical processes including but not limited to confirmation of expenditure numbers through the audit process.
The North West Provincial Government wishes to indicate that as at the beginning of the 2023/24 financial year, no unspent conditional grant fundsfor the 2022/23 financial year have beenreturned to the National Revenue Fundand all the affected departments have commenced with the preparatory work to submit rollover requests for the entire unspent conditional grant funding. As indicated above, the process would be concluded before the tabling of the adjustment budget in November 2023.
The above-mentioned figures would be subjected to a comprehensive and detailed verification including auditing by the Auditor-General. The audited numbers would be included in the 2022/23 annual reports of the departmentswhich would betabled to the Provincial Legislature in line with the PFMA provisions aspart of ensuring that the departments account to the Legislature through legislated processes for the expenditure including service delivery performance.
In an effort to ensurethat the provincedoes not record huge under-expenditure with regard to the 2023/24 conditional grant allocation, the Executive Council of North West has resolved to implement the following measures as a matter of urgency:
• Strengthen the project planning preparation for implementation by the beginning of the new financial year including commencement with necessary procurement processes by all the departments before the financial year starts;
• Institutionalise infrastructure and conditional grant expenditure reviews on a quarterly basis at both Technical and EXCO level
• Oversee the monthly and quarterly enforcement of the procurement plan monthly and ensure implementation of corrective measures on a continuous basis;
• Introduction of the “one-on-one expenditure reviews led by the Premier and Provincial Treasury” on a quarterly basis including enforcement of the recovery/remedial plan on a continuous basis;
• Re-allocation of budget (under-spending expenditure areas) to other critical expenditure based on a six months assessment and such re-allocation should be done across all the departments. The adjustment budget should be used to re-allocate budgets from non-spending programmes to critical expenditure priorities of government; and
• Executive “sign-offs” of all infrastructure and conditional grants projects by November 2023 for implementation in the new financial year with commitments including measures for the redress.
The above-mentionedfigures are issued and published in terms of Section 32 of the PFMA. The statement of provincial receipts and payments is based on the twelve (12) months departmental (province) revenue and expenditure performance of the 2022/23 financial year. This information is submitted by the Accounting Officers ofall provincialdepartments asper Section 40(4) PFMA reports to the provincial treasury, who in turn, submit the same information to the National Treasury. As part of the legislated accountability processes, the information relating to the detailed departmental expenditure performancecould be sourced from Accounting Officers of different departments.