REPORT ON CONDITIONAL AND POVERTY ALLEVIATION GRANTS PRESENTED BY THE DEPARTMENT OF EDUCATION AT THE PUBLIC HEARINGS ON THE DIVISION OF REVENUE HOSTED BY THE SELECT COMMITTEE ON FINANCE,

INDEX


ACRONYMS *
BACKGROUND *
Financial Management and Quality Enhancement in Education *
Introduction *
Question 1: *
The formula and criteria used for allocating the Grant (2002/03 to 2005/06) *
The Constitutional principles taken into account by the Grant *
Question 2: *
Trends in allocations, transfers and actual expenditure *
Question 3: *
Monitoring capacity and reporting *
Question 4: *
Qualitative and quantative performance indicators *
Question 5: *
Continuation of the Grant *
Life Skills: HIV/Aids *
Introduction *
Question 1: *
The formula and criteria used for allocating the Grant (2002/03 to 2005/06) *
The Constitutional principles taken into account by the Grant *
Question 2: *
Trends in allocations, transfers and actual expenditure *
Question 3: *
Monitoring capacity and reporting *
Question 4: *
Qualitative and quantitative performance indicators *
Question 5: *
Continuation of the Grant *
Early Childhood Development *
Introduction *
Question 1: *
The formula and criteria used for allocating the Grant (2002/03 to 2005/06) *
The Constitutional principles taken into account by the Grant *
Question 2: *
Trends in allocations, transfers and actual expenditure *
Question 3: *
Monitoring capacity and reporting *
Question 4: *
Qualitative and quantitative performance indicators *
Question 5: *
Continuation of the Grant *
THUBA MAKOTE: SCHOOLS FOR COMMUNITY DEVELOPMENT *
Introduction *
Question 1: *
The formula and criteria used for allocating the Grant (2002/03 to 2005/06) *
The Constitutional principles taken into account by the Grant *
Question 2: *
Trends in allocations, transfers and actual expenditure *
Question 3: *
Monitoring capacity and reporting *
Question 4: *
Qualitative and quantitative performance indicators *
Question 5: *
Continuation of the Grant *
IKHWELO POVERTY ALLEVIATION PROJECT *
Introduction *
Question 1: *
The formula and criteria used for allocating the Grant (2002/03 to 2005/06) *
The Constitutional principles taken into account by the Grant *
Question 2: *
Trends in allocations, transfers and actual expenditure *
Question 3: *
Monitoring capacity and reporting *
Question 4: *
Qualitative and quantitative performance indicators *
Question 5: *
Continuation of the Grant *
conclusion *

TABLES

Table 1: Allocations to provinces in 2002/03 to 2005/06 *
Table 2: Transfers to provinces in 2002/03 *
Table 3: Expenditure on Financial Management and Quality Enhancement as at 31 January 2003 *
Table 4: Comparison of expenditure against allocations during the past years *
Table 5: Allocation of HIV/Aids integrated plan according to provincial equitable share *
Table 6: HIV/Aids expenditure: 2000 – 2002 *
Table 7: Trends in allocations, transfers and actual expenditure – 2001/02 *
Table 8: Trends in allocations, transfers and actual expenditure – 2002/03 *
Table 9: Trends in allocations, transfers and actual expenditure – 2003/04 *
Table 10: Number of projects allocated per province *
Table 11: Allocation and expenditure for Thuba Makote *
Table 12: Allocations per province – 2001/02 to 2002/03 *
Table 13: Allocation per province – 2003/04 *
Table 14: Preliminary salary estimations *

ACRONYMS

ABET

Adult Basic Education and Training

AIDS

Acquired Immune Deficiency Syndrome

CEM

Council of Education Ministers

CFO

Chief Financial Officer

CSIR

Council of Scientific and Industrial Research

DoE

Department of Education

DORA

Division of Revenue Act

ECD

Early Childhood Development

EESF

Education Equitable Share Formula

EMIS

Education Management Information System

ETDQA

Education Training and Development Quality Assurance

FMQEE

Financial Management and Quality Enhancement Initiative

FMS

Financial Management System

Grade R

Reception year

HEDCOM

Heads of Education Departments Committee

HIV

Human Immune-deficiency Virus

IT

Information Technology

LSM

Learner Support Material

MTEF

Medium Term Expenditure Framework

NIP

National Integrated Strategy

OBE

Outcomes-based Education

PFMA

Public Finance Management Act

SACE

South African Council of Educators

SACE

South African Council of Educators

SASA

South African Schools Act

SETA

Sector Education and Training Authority

SGB

School Governing Body

SMME

Small-, Medium and Micro Enterprises

USAID

United States Agency for International Development



BACKGROUND

The Department of Education (DoE) is in charge of three conditional grant projects, i.e. Financial Management and Quality Enhancement in Education (FMQEE), Early Childhood Development (ECD), and HIV/AIDS. In addition to this, the DoE also manages two projects from the national special poverty relief fund, called the Thuba Makote and Ikhwelo projects.

The FMQEE is the oldest programme in the Department and is pivotally linked to the implementation of the Tirisano programme. The Early Childhood grant was introduced in the 2001/02 financial year, with the aim of extending the service to the poor through the provision of a Reception year. The HIV/AIDS programme on the other hand, was introduced in the 2000/01 financial year, with the purpose of identifying a certain age group as the primary intervention group for starting the Preventative Life Skills: HIV/AIDS Sexuality Education.

The Thuba Makote project was initiated by the Department to develop and pilot cost-effective approaches to the design, construction and management of school facilities that can also serve as community development centres. The Ikhwelo project was introduced in the 2001/02 financial year with the aim of providing skills in Agriculture and Small Medium and Micro Enterprises (SMME) at the Adult Basic Education and Training (ABET) levels 3-4 to adult learners.

The questions posed by the Standing Committee on Finance are found below:

Financia Management and Quality Enhancement in Education

Introduction

Government introduced the FMQEE Conditional Grant in the 1998/99 financial year. This special intervention was intended to address systemic problems that were identified as responsible for undermining the functionality of, and effective service delivery in the education system.

The Conditional Grant was introduced to provide National Departments with the tool needed to leverage specific strategic interventions in the education system in general, and in particular in the provincial departments. These strategic interventions could not be achieved through the utilisation of the normal line budget, owing to the fact that, in most provinces, the personnel costs tend to consume more than 85% of the allocated budget.

Further, the Conditional Grant allows funding to be ring-fenced for specific interventions. For these reasons, the Conditional Grant can not be used to fund the following:
Salaries;
capital expenditure; and
any activity that would incur recurrent costs.

The Grant was supposed to have been phased out in the 2002/03 financial year, but the DoE proposed that it be retained to consolidate the gains achieved over the last three years so as to improve the education outcomes and the final impact made at the schooling level. The Grant also plays a pivotal role in the implementation of the Tirisano education strategy.

Question 1:

The formula and criteria used for allocating the Grant (2002/03 to 2005/06)

The formula used for the allocation of the Grant to provinces is the education component of the equitable share. The education component of the Grant targets primary and secondary schooling, and both the school-age population and enrolment numbers are used to reflect the demand for education services. However, in this programme it would be difficult to quantify the total number of learners reached, as the programme has several priorities, which do not necessarily target the learners directly.

The Constitutional principles taken into account by the Grant

Section 214 of the Constitution requires that the annual Division of Revenue Act be enacted only after account has been taken of the factors set out in sub-sections 214 (2) (a) to (j) of section 214, of the Constitution. Below is a summary of the constitutional principles that were taken into account by the FMQEE Grant:

National interest and the division of resources: The Grant seeks to address four out of the six Tirisano strategic programmes and all of them are implemented countrywide. These four programmes are: School Effectiveness and Educator Professionalism, Further Education and Training, Organisational Effectiveness of the National and Provincial Departments, and Values in Education. All these programmes are skewed towards the nodal areas identified by the President in his State of the Nation Address and, thus, seek to redress the imbalances of the past. The fact that the allocation of the Grant to provinces is based on the education component of the equitable share formula, ensures that the different profiles of the provincial education departments are provided for.

Provision for dept costs: This provision is not applicable to the Grant.

National government needs and interests: The Grant aims to serve national interests in the sense that the Tirisano programmes are determined nationally and implemented in all nine provinces. All the Tirisano programmes encapsulate priorities set nationally but agreed with the provinces, as primary and secondary schooling is a concurrent function.

Provincial government basic needs: The Grant seeks to ensure the implementation of priorities determined nationally and agreed with the provinces. It also supplements the normal education budget in the provinces and, in so doing assist in addressing the basic needs of education in the provinces.

Fiscal capacity and efficiency: The basic aim of the Grant is to assist in ensuring that there is fiscal capacity and efficiency in the provinces by conducting capacity-building programmes on financial and other budget-related matters for officials both at the national level and in the provinces. The Grant also ensures that the necessary financial management systems are in place and are effective and efficient in all the provinces.

Developmental needs: Apart from helping to provide capacity-building programmes in financial management and system development, the Grant is also central in providing developmental support to provinces, in a variety of ways. The Grant assists in providing training for school governing bodies, school management teams, educators, the learners and the officials at both the provincial and the district level.

Economic disparities: The formula used to allocate funding to provinces is the education component of the equitable share, which takes into account the disparities among provinces. The disparities within a province are partially addressed by the skewing of resources to nodal areas identified in the President’s State of the Nation Address.

Obligation in terms of national legislation: The priority programmes to be implemented through this Grant have been nationally determined, but agreed with the provinces. The conditions imposed on the Grant ensure that national priorities are given prominence when programmes funded through this Grant are implemented. The monitoring of the use of this Grant by the DoE ensures that the provinces comply with the conditions of the Grant.

Predictability and stability: This provision of the Constitution is taken care of by the three-year Medium Term Expenditure Framework (MTEF) and the publication of indicative figures per province in the Division of Revenue Act (DORA). Through this mechanism the provinces are given the opportunity to plan over a three-year cycle and are therefore able to plan more effectively for the future. The business plans for gaining access to the funding from the Grant have also been prepared over a three-year cycle.

Need for flexibility in responding to emergencies: Although business plans have been approved over a three-year cycle, the provinces have the capacity to apply for deviations to take care of any changed circumstances and emergency situations that could not be predicted at the time of planning. Any such deviation will, however be approved only on condition that it occurs within the agreed framework.

Question 2:

Trends in allocations, transfers and actual expenditure

Allocations

The FMQEE Conditional Grants were allocated to the provinces according to the equitable share formula. The shares were allocated on the basis of relative need, with each province allocating its equitable share according to its own needs and priorities. The formula recognises that provinces have different economic profiles, demographic variations and significant variations in socio-economic circumstances. The allocations, in descending order (from the highest to the lowest), were made as follows:

Table 1: Allocations to provinces in 2002/03 to 2005/06

Provinces

Enrolment for 98, 99 & 00

2002/03 Allocation in
R’ 000

2003/04
Allocation in
R’ 000

2004/05 Allocation in
R’ 000

2005/06 Allocation in
R’ 000

KwaZulu-Natal

2 749 000

50 459

51 805

54 913

58 209

Eastern Cape

2 253 000

42 240

43 367

45 969

48 727

Limpopo

1 904 000

35 846

36 803

39 011

41 352

Gauteng

1 508 000

28 083

28 833

30 563

32 397

North West

934 000

18 266

18 753

19 878

21 071

Western Cape

928 000

18 037

18 519

19 630

20 808

Mpumalanga

922 000

16 667

17 112

18 139

19 227

Free State

784 000

14 384

14 768

15 654

16 593

Northern Cape

202 000

4 338

4 454

4 722

5 004

Total

12 184 000

228 320

234 414

248 479

263 388


The allocation of funds as indicated above was done according to the equitable share formula, following the enrolment of the learners per province. KwaZulu-Natal, which was allocated R50 459 000 had 2 749 000 learners enrolled in 1998, 1999 and 2000. The Northern Cape, which ranked lowest in the allocation of funds, had the lowest number of learners enrolled in 1998, 1999 and 2000. The province was allocated R4 338 000 in the 2003/04 financial year. Besides enrolment figures, equitable share allocation also takes into consideration infrastructure backlogs and poverty levels. It is for this reason that Conditional Grants funds also target nodal areas.

Transfers

The transfer of funds happens in four tranches, on a quarterly basis. The first tranche is transferred to provinces during the first week of April, that is, at the beginning of the financial year after, the approval of the business plans. In 2002/03 the transfers to provinces were done as follows:

Table 2: Transfers to provinces in 2002/03

Tranches

Provinces

Dates

Comments

1st

all

5 April 2002

 

2nd

all

5 July 2002

 

3rd

All except Eastern Cape

4 October 2002
4 November 2002
4 December 2002

Funds withheld owing to non-compliance

4th

all

14 January 2003

 


Delays in the transfer of funds on the third quarter occurred as a result of the National DoE’s response to regulations regarding under-spending and non-compliance. Provinces were warned in advance that National Treasury would withhold funds from provinces that were under-spending on their allocated budget.

Actual expenditure for the 2002/03 financial year

On 31 January 2003, the expenditure on FMQEE Conditional Grants for 2002/03 was as follows:

Table 3: Expenditure on Financial Management and Quality Enhancement as at 31 January 2003

PROVINCE

EXPENDITURE IN %

Gauteng

102.07

North West

97.63

Mpumalanga

93.48

Western Cape

76.60

KwaZulu-Natal

65.83

Northern Cape

65.56

Free State

65.00

Limpopo

36.92

Eastern Cape

35.39


The graph below illustrates the expenditure of the allocated funds per province for the 2002/03 financial year:



Provinces that did not spend much on their allocated funds indicated that procurement procedures and payment processes hindered expenditure in their provinces.

Despite the under-expenditure, the overall level of expenditure shows an improvement over time. This is reflected in the table below:

Table 4: Comparison of expenditure against allocations during the past years

Conditional grant cycle

Total Allocation

Expenditure

Amount unspent

Percentage unspent

1998/1999

149,541

26,029

123,512

82,6%

1999/2000

192,000

96,790

95,210

49,6%

2000/2001

253,987

133,042

120,945

47,6%

2001/2002

237,947

174,647

63,300

26,6%

2002/2003

228 320

149 490

78830

34,5%


Since the inception of the Grant in 1998 there has been a gradual improvement in expenditure of funds in the department. In the 1998/1999 financial year, 82% of the R149 541 million was not spent. In the 2001/02 financial year, R237 947 000.00 was allocated and only 26,6% was not spent. The improvement in expenditure may be attributed to improved capacity in project management and implementation.

Question 3:

Monitoring capacity and reporting

Monitoring in the 2001/02 financial year

The Department has sufficient capacity to monitor Conditional Grants projects. Project Managers complied with the conditions of Conditional Grants through the submission of monthly reports. Conditional Grants are a standing item of HEDCOM and CEM meetings. In this way, the performance of this Grant is monitored both at the political level and at the departmental level.
Financial and progress reports were presented at the Inter-provincial Committee meetings.
Reports from Provincial Treasuries are forwarded to the Finance section of the Department on the 15th of every month and reminders are sent before the submission dates.

Steps followed to ensure full compliance:

The Chief Financial Officers (CFOs) of the provinces were invited to the Inter-provincial Committee meetings to ensure that provinces comply with the conditions for conditional grants. When there were discrepancies regarding the expenditure figure received by the DoE and by Treasury the CFOs of all provinces were called to rectify the mistake.
The DoE withheld funds in the third quarter of the 2002 financial year, owing to low expenditure. The third transfers to provinces were withheld for 30 days to enforce compliance.
Monitoring of the FMQEE Conditional Grants was done by the HEDCOM sub-committee, which holds quarterly meetings that deal with compliance issues.

Monitoring in 2002/03 financial year

The Inter-provincial Committee meetings and the forum meetings were held on the scheduled dates. The members of these committees were afforded the opportunity to discuss their progress and financial reports. Issues such as under-spending, over-spending, deviation and unauthorised expenditure were addressed and the necessary advice given to provinces experiencing these challenges.
On-site monitoring was introduced in the 2002/03 financial year. The team from the DoE visited each province twice a year to ensure compliance.

Question 4:

Qualitative and quantative performance indicators

The primary objective of the FMQEE Conditional Grant is to provide financial support to a wide range of national and provincial education development initiatives intended to address systemic problems that undermine the functionality and the efficacy of the different levels of the education system. The Grant addresses the following strategic priorities: 1. School Effectiveness, 2. Further Education and Training, 3. Organisational effectiveness of the national and provincial Departments of Education, and 4. Values in Education. Since the inception of Conditional Grants in 1998/99, (then known as the Policy Reserve Fund), there has been a gradual improvement in the education system generally and a significant improvement in the management of programmes funded through Conditional Grants in particular. Although the DoE has not conducted a formal study into the impact of conditional grants on the system, the provinces have reported the following observations:

School Effectiveness:

The training of governing bodies in a variety of issues including, but not limited to, governance, conflict management, fund raising and financial management has assisted in institutionalising the structure and also helped to clarify the difference between governance and management of schools.
The project on School Safety has assisted in creating community awareness on how a number of issues such as drug abuse, child molestation, vandalism of schools and rape impact on the schools. The resulting heightened awareness has enhanced communities’ sense of ownership of their schools.
The project dealing with engendering community pride focused on making schools conducive to education by effecting minor renovations, planting flowers and vegetables and making schools centres of community life by encouraging communities, and in particular the unemployed, to create food gardens at the schools.
The projects on whole school and systemic evaluation have assisted in creating a culture of learning and teaching in the schools and, as a result of these projects, provinces such as Gauteng have set up an Office for Standards whose role it is to ensure compliance.
The project dealing with curriculum 2005 has helped with training and developing educators and office-based staff in respect of curriculum-related issues, and this has contributed towards stabilising the schools and making them safety havens for the learners.
The project dealing with Governance and Management training has assisted in providing capacity building for managers of schools and district officials, and this has contributed towards decreasing conflicts and fraud at school level. It also encouraged schools to apply for section 21 status.

Further Education and Training:

This conditional grant plays a pivotal role in the restructuring of this band, although a lot of funding is still needed to complete the process.
In particular, funds drawn from this Grant have assisted in building awareness in the nodal areas of the importance of such learning areas such as Mathematics, Science, Technology, and of how these could help learners to be competitive and to participate in the economy of the country.
The project is also playing an important role in targeting previously disadvantaged learners and, in particular, female learners for participation in the gateway subjects, thereby creating opportunities for them to enter professions that have until now been monopolised by males. The impact of this form of targeting will be realised over time.

Organisational Effectiveness of the National and Provincial Departments:

The Grant is also used to build three systems, i.e. the Education Management Information System (EMIS), the Financial Management System (FMS) and the system dealing with the management and procurement of learner support material (LSM).
The Grant is making an important contribution towards the establishment of an efficient EMIS although a lot of work still has to be done in this area.
Regarding the management of LSM, significant progress has been made in the sense that by the beginning of each year all schools have received the necessary requirements and that most of the section 21 schools are managing this area very well. A lot still needs to be done in building an effective and efficient retrieval system in the historically disadvantaged schools.
The Grant is playing an important role in establishing a sound financial management system. In some provinces the Grant has been used to conduct leave audits and to restructure financial management systems. In almost all provinces the Grant has been used to build the capacity of the officials to manage finances and projects.

Values in Education:

Progress and, therefore, impact in this area is not yet substantial, as this is a relatively new priority for the department. The progamme is supposed to contribute towards building moral fibre and values in the system. The department has used part of the Grant to launch the History Project and to build awareness for heritage month.
The Grant has also been used to a lesser degree to fund the Tirisano Eisteddfod and to highlight the importance of National Symbols.

Question 5:

Continuation of the Grant

The Grant was introduced in the 1999/00 financial year and was to be phased out in 2002/03. But the Department proposed that the Grant be retained to consolidate the gains achieved in the first three years since inception. The Grant is to be phased out in 2005/06.


Life Skills: HIV/Aids

Introduction

Cabinet, at its meeting of 24 November 1999, approved the setting aside of funds on the National Budget for an effective integrated response to the HIV/AIDS epidemic i.e. National Integrated Plan for Children and Youth infected and affected with HIV/AIDS (NIP). At a meeting held on 2 December 1999, the Directors General of the Departments of Health, education and welfare identified three broad principles:

Support for the idea of special allocation for an integrated strategy to address the epidemic;
An integrated and comprehensive plan should be developed – the approach of merely dividing the money between different departments for separate and isolated projects should be avoided; and
Spending should be targeted well and caution taken not to try to cover to wide an area.
One of the six components, the introduction of life skills programmes in schools, would be the core of the initiative absorbing the bulk of the money in initial years with its main goal to implement an integrated school curriculum-based Life skills and HIV/AIDS Education programme that will assist youth to acquire knowledge, develop skills and establish values that will enable them to make responsible choices and grow up healthy. The programme will focus on:
To initially train Grade 5 to 9 teachers (but not excluding other grades) to facilitate life skills and HIV/AIDS education within the curriculum.
To train teachers to offer care and support to affected learners.
To ensure support for the programme from school communities.
To develop and procure age-appropriate and relevant LSM for learners, educators and parents.
Establish and develop peer educator programme for learners.
School-based activities focusing on substance abuse, gender violence, child abuse, HIV/AIDS events etc.
Monitoring and evaluation of programme i.e. conduct research on the efficacy of the programme on learners behaviour.

Question 1:

The formula and criteria used for allocating the Grant (2002/03 to 2005/06)

The education component of the equitable share, which is the formula used for allocating the Grant to the various provinces, targets primary and secondary schooling, and this account for 80% of provincial spending. Both the school-age population (ages 6 to 7) and enrolment numbers are used to reflect the demand for education services.

For the purpose of this Grant, certain age groups (12 to 15-year olds, in grades 7 to 9) were identified as the primary intervention group with which to start preventative Life Skills: HIV/AIDS Sexuality Education.

The Constitutional principles taken into account by the Grant

National interest and the division of resources: HIV/AIDS threatens the stability of the national macroeconomic environment, strong economic growth and efficient public services in general. With this in mind, a five-year national HIV/AIDS strategy, led by the Health Department, was developed. This strategy includes the provision of Life Skills: HIV/AIDS and Sexuality Education in all primary and secondary schools. It is hoped that this will serve to mitigate the impact of the HIV infection rates in the country and to provide care and support to infected and affected learners and educators.

National Government’s needs and interests: The prevention of HIV/AIDS-related illnesses is a national government priority: hence the escalating allocations to preventative and support programmes.

Provincial and local government basic services: Provinces are responsible for delivering key functions, such as school education. The Grant enables provinces to deliver HIV/AIDS preventative programmes to all learners and educators and to school communities.

Economic disparities: Economic and geographic disparities between and within provinces are addressed by the equitable share formula which are redistributive towards poorer provinces. The current and future allocations will also prioritise allocation in the identified nodal areas.

Obligations in terms of national legislation: The DoE determines the key areas of implementation and the percentage allocated to these that provinces should utilise, and also monitors the implementation of the Life Skills: HIV/AIDS programme in provinces and schools.

Predictability and stability: The past and present MTEF baseline allocations ensure that Education can start forward planning on the Life Skills programme. Also, scheduled transfers of allocations ensure that activities are not delayed.

Flexibility in responding to emergencies: The conditions of the Grant make provision for flexibility in the utilisation of allocated funds.

Question 2:

Trends in allocations, transfers and actual expenditure

Table 5: Allocation of HIV/Aids integrated plan according to provincial equitable share

PROVINCE

WEIGHTED SHARE
(%)

REVISED
BUDGET
FOR 2002/03
R'000

MTEF
BUDGET
FOR 2003/04
R'000

MTEF
BUDGET
FOR 2004/05
R'000

MTEF
BUDGET
FOR 2005/6
R'000

EASTERN CAPE

18,4

27,238

22,288

23,787

25,215

FREE STATE

6,30

9,072

7,590

8,100

8,586

GAUTENG

12,60

17,712

14,818

15,816

16,765

KWAZULU-NATAL

22,0

31,824

26,624

28,416

30,120

LIMPOPO

15,40

22,613

18,915

20,187

21,398

MPUMALANGA

7,30

10,512

8,794

9,386

9,949

NORTHERN CAPE

1,90

2,738

2,289

2,443

2,589

NORTH WEST

8,00

11,520

9,638

10,286

10,904

WESTERN CAPE

8,00

11,376

9,518

10,158

10,767

TOTAL

100

144,605

120,474

128,579

136,293


Table 6: HIV/Aids expenditure: 2000 – 2002

 

2000/2001

2001/2002

Province

Allocation

Expenditure

% Spent

Balance

Approved

Allocation

Total funds

Expenditure

Balance

% Spent

Roll-over

available

at March 02

from 00/01

 

R'000

R'000

 

R'000

R'000

R'000

R'000

R'000

R'000

 

Eastern Cape

4,572

-

0.00%

4,572

-

11,747

11,747

7,376

4,371

62.79%

Free State

2,297

 

0.00%

2,297

2,297

4,001

6,298

2,842

3,456

45.13%

Gauteng

2,296

2,294

99.91%

2

-

7,810

7,810

6,331

1,479

81.06%

KwaZulu-Natal

4,617

330

7.15%

4,287

4,287

14,033

18,320

12,593

5,727

68.74%

Mpumalanga

2,473

1,062

42.94%

1,411

2,000

4,636

6,636

5,720

916

86.20%

Northern Cape

1,467

126

8.59%

1,341

566

1,207

1,773

1,817

(44)

102.48%

Limpopo

4,572

-

0.00%

4,572

-

9,969

9,969

2,459

7,510

24.67%

North West

2,339

1,604

68.58%

735

734

5,080

5,814

5,032

782

86.55%

Western Cape

2,297

816

35.52%

1,481

1,474

5,017

6,491

1,388

5,103

21.38%

TOTAL

26,930

6,232

23.14%

20,698

11,358

63,500

74,858

45,558

29,300

60.86%




Question 3:

Monitoring capacity and reporting

Since the Grant is part of an integrated strategy, regular inter-departmental (Education, Health, Social Development) and inter-provincial meetings are scheduled. A HEDCOM subcommittee was established to meet at least every six weeks to discuss financial expenditure and progress on the implementation of the Grant. Similar monthly meetings are also held in provinces. This has contributed to an increase in spending and an expansion of activities, as reflected in total expenditure in 2000/01 (23 %) and in 2001/02 (74%).

Provinces are reminded on a monthly basis to submit financial and progress reports as required by DORA. Improved timeous submission of reports has been noted. A national coordinator and provincial Life Skills coordinators have been appointed to monitor and support Conditional Grants in provinces. In some instances where low expenditure patterns were noted, transfers of funds have been withheld until those provinces (Eastern Cape, Limpopo) could give reason for low expenditure.

Question 4:

Qualitative and quantitative performance indicators

Approximately 35,800 Life Skills educators for grades 1 to 12 and 683 Master trainers have been trained. Educators are expected to provide learners with age-appropriate sexuality education as part of the Life Skills: HIV/AIDS learning programme. Educators in other learning areas are to be targeted in the next financial years.
Appropriate LSM learner activity books and teacher guides (also catering for learners with disabilities, e.g. Braille) have been developed and printed for the use of grade 1 to 12 educators and learners. These have been distributed to more than 80% of schools.
Provinces have procured first aid kits for schools and trained educators in basic first aid to assist with the implementation of Universal Precautions.
Life Skills coordinators and finance administrators have been appointed/seconded to monitor and support provinces in the implementation of the Life Skills programme in schools.
Parent resource guides on communicating sexuality issues to their children have been developed and printed in all official languages
Advocacy and information workshops for School Governing Bodies (SGBs) and other stakeholders (traditional leaders, community leaders and faith-based organisations) were held. These events usually preceded the implementation of the Life Skills programme in schools in order to inform parents of the content and methodology of the programme.
Various school-based activities were held during Life Skills Week in September. Here schools actively participated in provincial- and district events focusing on child abuse, substance abuse, etc.

Question 5:

Continuation of the Grant

It is strongly recommended that the Grant should continue focusing more on the care and support aspects of the pandemic. It will also give provinces time to set up HIV/AIDS units to ensure full integration and coordination of HIV/AIDS activities within and across the system.

Early Childhood Development

Introduction

This Conditional Grant was introduced for the first time in 2001/02. The purpose of the Grant was to extend ECD services to the poor through the provision of a quality Reception Year (Grade R) programme at 4,500 selected community-based sites.

The basic components of the Grant include:
Transfer payments to provinces to cater for the following:
Providing a subsidy of at least R12, 000 per annum to 4,500 Grade R classes in community-based sites.
Training of 4,500 practitioners towards a Level 4 ECD Qualification.
Training of 4,500 site management teams to ensure effective management of participating sites.
Administration of the programme in the province.
Inform and educate the public on the main elements of White Paper 5 on ECD through a multi-media advocacy and information campaign.
Develop a monitoring and evaluation system to ensure effective monitoring and on-going support to all participating sites.
Provide a basic educational pack to all participating sites to support curriculum implementation in the participating sites.

Question 1:

The formula and criteria used for allocating the Grant (2002/03 to 2005/06)

The ECD Conditional Grant used the Education Equitable Share Formula (EESF) to determine the allocation to the provinces. The formula does not include the age cohort with which we are working.

The programme is based in the DoE. One of its main aims is to enhance provincial capacities to support the implementation of White Paper 5 on ECD. All provinces are required to participate.

To participate in the programme, provinces are required to submit a business plan that clearly outlines the implementation of the programme. This will include procedures for monitoring, tendering and subsidisation plans.

The Director-General: Education will approve each plan before any allocation is made to the province. Each province committed itself to making a staff member responsible for serving as Provincial Project Coordinator and to establish regional/district management committees to ensure effective and regular monitoring of, and support for the selection of sites.

The criteria used for the selection of sites for participation in the programme include the following:
1. Sites must -
be registered or have applied for registration;
have been in existence for at least three years;
have adequate financial systems to account for funds received;
have a maximum ratio of 1:40, but, preferably, a recommended ratio of 1:30; and
sign a renewable one-year contract with the provincial DoE to provide the service.
2. The practitioner must participate in a training programme to ensure the attainment of at least a Level 4 qualification.
3. Families must pay in-kind contribution or fees.

Particular attention will be paid to ensuring that the areas identified for Urban Renewal and Rural Development will be included.

The Constitutional principles taken into account by the Grant

National interest and the division of resources: Approximately 40% of young children in South Africa grow up in conditions of abject poverty and neglect. This is a period of great vulnerability and children raised in poor families are most at risk of infant death, low birth-weight, stunted growth, poor adjustment to school, increased repetition and school dropout. To break the cycle of poverty the White Paper 5 on ECD proposed the establishment of a national system of provision for the Reception Year. The White Paper further proposes to approach this in a poverty-targeted, phased manner. The ECD Conditional Grant was the first step towards realising the goal of providing a quality Reception Year programme to all 4 to 5 year olds in South Africa.

Provision for debt costs: This provision is not applicable to this Grant.

National government needs and interests: In order to meet the objectives of the programmes, additional personnel were appointed in each province. Additional support was received from service providers through six national tenders for implementation of certain aspects of the programme e.g. training of practitioners, advocacy campaign, supply of educational equipment and training of the site management teams. Systems have been established to provide subsidies to sites, as well as regional-/-district monitoring and support systems.

Provincial government basic services: White Paper 5 on ECD provides a plan for the phasing in of a compulsory Reception Year (Grade R) programme by 2010. This programme reinforces government’s commitment to providing a compulsory Grade R programme as part of the Foundation Phase in the General Education and Training Band.

Fiscal capacity and efficiency:
Provinces are currently providing from grade 1 onwards through the provincial allocation. Grade R is a new programme and is required to be phased in over a 10-year period. The present systems used to manage the current provincial share will incorporate this phase in the programme for Grade R funded from the conditional Grant.

Developmental needs: Through the selection of the poorest sites in the province, sites are supported to ensure that poor children have access to a quality Reception Year Programme.

Economic disparities within provinces, not among provinces: Particular care was taken in selecting sites in the identified nodal areas (60%/40% split).

Obligations in terms of national legislation: The Grant provides funds to provinces to begin implementation of White Paper 5 on ECD in a phased-in approach, starting with the poorest children.

Predictability and stability: Allocations are transferred according to a payment schedule. This is a three-year provision and allocations for year two and three were forecast at the beginning, which allowed provinces to plan for increasing of provision.

Flexibility in responding to emergencies: Although the Public Finance Management Act (PFMA) provides for allocation of funds to deal with emergency situations, this Grant is earmarked for the provision of extended services to poor children as determined by the conditions of the Grant.

Question 2:

Trends in allocations, transfers and actual expenditure

The programme was designed to build on the experiences and findings of the National Pilot Project. The expenditure in the first year of implementation, 2001/02, is a reflection of the success of the Pilot Project. Provinces that implemented the Pilot Project as designed had the systems in place and had selected sites to continue with the budget provided. In year one, the Northern Cape, the Western Cape and KwaZulu-Natal reflected a significant rate of expenditure compared to the rest of the provinces.

Delays in the awarding of tenders caused a further delay in implementation in all the provinces. The tenders are managed and awarded by the DoE.

The expenditure in the second year is significantly increased, for the following reasons:
In all provinces except North West, systems have been established.
In all provinces except North West, additional personnel were appointed to assist in the implementation of the programme.

Owing to delays in the setting up of systems for the selection of sites and payment of subsidies, all provinces combined the selection of sites earmarked for year one and two in this financial year. The expenditure for 2002/03 reflects this.

As payments are made on completion of functions, the provinces have indicated that the final payment for the last quarter, January to March 2003, will affect expenditure for that period.

Four of the six tenders were awarded during this financial year and this will significantly contribute to spending in the next financial year.





Table 7: Trends in allocations, transfers and actual expenditure – 2001/02

Province

Allocation

Transfer

Roll-over from 2001/2002

Total budget

Actual expenditure

Targeted No. of sites

Targeted number of learners

Per-head allocation

Eastern Cape

3,885

3,885,000

 

3,885,000

 

275

8,250

471

Free State

1,323

1,323,000

 

1,323,000

 

65

1,950

678

Gauteng

2,583

2,583,000

 

2,583,000

 

184

6,000

431

KwaZulu-Natal

4,641

4,641,000

 

4,641,000

 

200

5,520

841

Limpopo

3,297

3,297,000

 

3,297,000

 

236

7,080

466

Mpumalanga

1,533

1,533,000

 

1,533,000

 

110

3,300

465

Northern Cape

399

399,000

 

399,000

 

25

750

532

North West

1,680

1,680,000

 

1,680,000

 

120

3,600

467

Western Cape

1,659

1,659,000

 

1,659,000

 

119

3,570

465

Total

21,000

21,000,000

 

21,000,000

 

1,334

40,020

525

 




Table 8: Trends in allocations, transfers and actual expenditure – 2002/03

Province

Allocation

Transfer

Roll-over from 2001/2002

Total budget

Actual expenditure

Balance

Targeted No. of sites

Targeted number of learners

Per-head allocation

Actual cost per head

Eastern Cape

9,620

9,805,000

3,850,000

13,655,000

7,097,000

6,558,000

550

16,500

594

430

Free State

3,276

3,339,000

1,299,000

4,638,000

2,037,000

2,601,000

130

3,900

856

522

Gauteng

6,396

6,519,000

2,532,000

9,051,000

6,906,000

2,145,000

368

12,000

543

576

KwaZulu-Natal

11,492

11,713,000

1,551,000

13,264,000

6,245,000

7,019,000

400

11,040

1,061

566

Limpopo

8,164

8,321,000

3,297,000

11,618,000

5,042,000

6,576,000

472

14,160

588

356

Mpumalanga

3,796

3,869,000

1,533,000

5,402,000

1,688,000

3,714,000

220

6,600

586

256

Northern Cape

988

1,007,000

155,000

1,162,000

478,000

684,000

50

1,500

671

319

North West

4,160

4,240,000

1,680,000

5,920,000

1,369,000

4,551,000

240

7,200

589

190

Western Cape

4,108

4,187,000

932,000

5,119,000

2,063,000

3,056,000

238

7,140

586

289

Total

52,000

53,000,000

16,829,000

69,829,000

32,925,000

36,904,000

2,668

80,040

662

411





Table 9: Trends in allocations, transfers and actual expenditure – 2003/04

Province

Allocation

Transfer

Roll-over from 2001/2002

Total budget

Actual expenditure

Balance

Targeted No. of sites

Targeted number of learners

Per-head allocation

Eastern Cape

16,280,000

16,280,000

 

 

 

 

825

24,750

658

Free State

5,544,000

5,544,000

 

 

 

 

285

8,550

648

Gauteng

10,824,000

10,824,000

 

 

 

 

552

29,880

362

KwaZulu-Natal

19,448,000

19,448,000

 

 

 

 

996

16,560

1,174

Limpopo

13,816,000

13,816,000

 

 

 

 

708

21,240

650

Mpumalanga

6,424,000

6,424,000

 

 

 

 

330

9,900

649

Northern Cape

1,672,000

1,672,000

 

 

 

 

87

2,610

641

North West

7,040,000

7,040,000

 

 

 

 

360

10,800

652

Western Cape

6,952,000

6,952,000

 

 

 

 

357

10,710

649

Total

88,000,000

88,000,000

 

 

 

 

4,500

135,000

652

Question 3:

Monitoring capacity and reporting

In order to comply with the requirements of the Division of Revenue Act, the following is undertaken:
Provinces submit to the DoE monthly reports indicating cash flow. There are monthly meetings of all provincial officials and coordinators to report on and develop strategies to accelerate implementation.
The quarterly reviews are planned to address gaps in the management capacity of coordinators in the provinces. Provincial visits have been planned to monitor and support implementation. To date, the following provinces have been visited: KwaZulu-Natal, the Western Cape, the Free State and the Eastern Cape.
Once a year the business plans are reviewed for planning for the next year and also to increase the targets.

A general problem was experienced with provinces not submitting signed reports to the DoE. Provinces were informed of this and the steps taken were to withhold the transfer of payment until there was compliance.

With the appointment of additional staff in the DoE and the appointment of the National Coordinator, the capacity to monitor has been significantly increased.

Question 4:

Qualitative and quantitative performance indicators

The plans for 2002/03 targeted 3 000 sites. To date, 2 669 of the 3 000 sites have been receiving subsidies. The plans for 2003/04 will increase the number to reach the targeted 4 500 sites.

Registration of the qualification: SACE has agreed to register the 4 500 practitioners on the conditional grant. This will be conditional until they obtain a required minimum qualification.

Tenders:

Monitoring and support systems: Khulisa Management Services has been appointed to assist the DoE in developing a monitoring and support tool. This will include, amongst others, the training of 150 district officials.

Support for learners in curriculum implementation: ECDworks and Spectrum were appointed to supply, package and deliver 1 850 LSM kits to selected Grade R sites. The dates of delivery to the 932 sites in Limpopo, Mpumalanga and North West will be between 19 and 26 March 2003. There have been delays in the delivery of 928 kits to Gauteng, KwaZulu-Natal and the Free State, owing to problems experienced with the service provider. The matter has been handled by the Departmental Tender Committee.

Accreditation of service providers: The Directorate is working closely with the ETDQA to assess the readiness of the providers to provide an accredited qualification.

Question 5:

Continuation of the Grant

At the completion of the Grant cycle, there would have been only an effective two years of implementation for the majority of provinces. There is a need to evaluate the impact and provide lessons for further roll out.

Motivate for at least one-year extension. This will allow us to assist provinces that are not fully ready to take total responsibility for the programme.

THUBA MAKOTE: SCHOOLS FOR COMMUNITY DEVELOPMENT

Introduction

Current school buildings are outdated in terms of designs, multi-functionality, space utilisation, curriculum suitability and the latest technology requirements. The maintenance of school buildings is currently very expensive and is being neglected due to financial constraints. Strategies need to be developed to ensure that school infrastructure are being utilised optimally and that the infrastructure facilities create opportunities for income-generating activities which can then in turn contribute to the financing of the maintenance of the existing infrastructure.

The school infrastructure in South Africa is extensive with about 28 000 schools. Although many of these are in poor condition, they are generally located where they are easily accessible to their local communities. Most of these facilities have very low utilisation rates, as they are generally only used by school children, during school hours and are otherwise standing empty. Existing infrastructure can be upgraded or new infrastructure can be designed in such a way that it can be used more efficiently and effectively for education, as well as cater for community needs and development.

The Provincial Departments of Education with the assistance of Donors are addressing the backlogs and the poor condition of school infrastructure. This has concentrated on building conventional schools and classrooms. This has however had a limited impact on community development as it only caters for school-going children. This conventional approach also perpetuates or worsens a number of problems. These problems include:
increasing the financial burden to Government to provide and maintain sufficient infrastructure for Education;
vandalism and theft; and,
lack of community and business involvement as the school is often vacant after school hours and does not proactively seek the involvement of the community and other partners.

Recent policies from the DoE indicate a new approach to education. These are outlined in the South African Schools Act (Act 84 of 1996 hereafter referred to as the South African Schools Act) and the Tirisano Implementation Plan. The South African Schools Act encourages schools to take more responsibility for their buildings and to use these for the good of the school. It also suggests that schools become more proactive in developing partnerships with business, communities and parents.

The Tirisano documents clearly sets out a plan which suggests that:
there should be increased co-operation between government departments;
schools should become centres of community life;
schools designs should be adopted to become suitable for Outcome-based Education;
active learning should be supported;
the issue of HIV/AIDS must be addressed; and
the physical degradation of schools must be stopped.

Education facilities need to be designed and developed in such a manner that it supports the new education policies. The most important aspects to address is:
the design of learning spaces to facilitate outcomes-based education;
the improvement of security at schools and the prevention of vandalism and crime;
adaptations to school infrastructure to be accessible for learners with special education needs;
incorporation of IT technology to support education;
provide facilities to support community activities; and,
provide support, resources and facilities to combat the spread of HIV/AIDS as well as support to HIV positive children and AIDS sufferers.

Job creation, rural development, education, HIV/AIDS and poverty alleviation have been identified as key priorities to be addressed in South Africa. These needs have to be addressed within limited existing resources and capacity. The Thuba Makote Programme is targeted at poor communities. Poor communities have a range of needs, these include:
employment: including self employment;
education: including school, adult education, ECD, small business development, health, vocational education and support (i.e. agriculture, furniture and building component manufacturing);
access to communication technology including telephone, postal and the internet;
provision of fresh and healthy food; and,
support, resources and facilities to combat the spread of HIV/AIDS as well as support to HIV positive individuals and AIDS sufferers.

The design and operation of schools offer a large number of opportunities to cater for these needs, but requires an approach that both designs and specifies appropriate spaces, buildings, technology and equipment and develops organisational structures and capacity to run these and ensure that they are financially sustainable.

The DoE embarked on the Thuba Makote Programme during the 2001/02 financial year. Nine pilot schools are currently under construction. An implementing agency was contracted for the piloting of the first nine schools. The brief included the development of a new approach that re-evaluated the design, construction and operation of schools in terms of opportunities for partnerships as well as catering for community needs and development. The new approach developed, aimed to achieve a good school education while making a substantial contribution to community development. This has been done within a framework that ensured that capital and ongoing resources were stretched, by working with partners and that structures were put in place to ensure the sustainability of projects.

Question 1:

The formula and criteria used for allocating the Grant (2002/03 to 2005/06)

The Thuba Makote Programme is funded from the allocation for Poverty Alleviation, Infrastructure and Jobs Summit Projects. The approved business plan submitted to Treasury indicated that the programme would initially pilot nine schools, one in each province. The reason was that these schools should serve as innovative models, which could then be replicated by Provincial Departments of Education. Each community has been allocated a budget of R5,3 million for the first pilot school in each province.

A new approach is being developed through this programme, which aims to achieve a good school education while making a substantial contribution to community development. This new approach is being followed within a framework that ensures that capital and ongoing resources are stretched by working with partners and by placing structures in place that ensure the sustainability of projects.

It is a requirement of National Treasury that the number of projects allocated to provinces in the second stage must be based on school infrastructure backlogs in the various provinces. The calculation of the number of projects allocated per province is shown in the Table below:

Table 10: Number of projects allocated per province

Province

Percentage share in total national backlogs at the end of the 2001/02 financial year
(A)

Percentage share in the available 9 projects based on percentage backlog share
B=A*11

Number of projects allocated
(Round B)

Eastern Cape

0,258

2,838

3

Free State

0,082

0,902

1

Gauteng

0,043

0,473

0

KwaZulu-Natal

0,229

2,519

3

Limpopo

0,201

2,211

2

Mpumalanga

0,076

0,836

1

Northern Cape

0,009

0,099

0

North West

0,073

0,803

1

Western Cape

0,023

0,253

0


The percentage backlog share was based on the calculation of backlogs per province and the costing of the backlogs. The backlogs were calculated from the data in the School Register of Needs Survey 2000. Estimations of infrastructure developed from 2000 until the end of the 2001/02 financial year were made and deducted from the recorded backlogs in the School Register of Needs Survey 2000. Costing of infrastructure backlogs was based on the average budgeted costs in the business plans submitted by provinces to the Minister of Education for the MTEF period 2002/03 to 2004/05. The allocation for the 2003/04 financial year is R64 million. This amount will enable the DoE to build another 11 schools, each with a ceiling price of R5,78 million.

The total amount available for distribution to projects in the provinces is therefore, R63,6 million (11 x R5,78 million). R400 000,00 of the allocation is retained for national co-ordination, launches, monitoring and quality control.

The Constitutional principles taken into account by the Grant

Section 214 of the Constitution requires that the annual Division of Revenue Act only enacted after account has been taken set out in sub-section 214 (2) (a) to (j), of the Constitution. Below is a summary of the constitutional principles that were taken into account by the poverty alleviation grant.

National interest and the division of resources: The Thuba Makote Programme seeks to address the Tirisano strategic programmes. One of the Minister of Education’s priorities is to ensure that schools become centres of community life. This Programme specifically focus on community involvement and utilisation of school facilities. It further ensures that schools are designed and equipped to facilitate outcomes-based education and provide opportunities for community members to generate income. Another priority of the Minister is to stop the physical degradation of school facilities. One of the principles of the Thuba Makote Programme is to prevent vandalism and encourage maintenance through community participation and ownership of the facilities. Since these schools would serve as models for future school infrastructure development, one in each province was developed during stage 1. During the second stage, the allocation of projects was based on existing school infrastructure backlogs in provinces which ensures that the different profiles of the provincial education departments are provided for.

Provision for debt costs: This provision is not applicable to the Grant.

National Government needs and interests: The Grant serves national interests in the sense that the principles embedded in the Tirisano programmes and the education legislation are incorporated in innovative designs and utilisation of school facilities through the Thuba Makote Programme.

Provincial government basic needs: The funding are used to address poverty through job creation and the development of school infrastructure for the provision of education in the provinces.

Fiscal capacity and efficiency: The programme aims to develop basic fiscal capacity and income-generating opportunities for schools through skills training and training in business principles for the development of SMMEs. Training in facility management and maintenance is provided to ensure that the investments in the infrastructure are optimised.

Developmental needs: The programme entails job creation, skills training to community members, the development of SMMEs as well as the development of basic infrastructure for education purposes as well as for community activities.

Economic disparities: The formula used to allocate projects to provinces during stage 2 is based on existing infrastructure backlogs, which takes into account the disparities among provinces. The disparities within a province are partially addressed by the allocation of the projects to poor communities.

Obligations in terms of national legislation: The Programme aims to incorporate innovations in designs, the way schools operate and the utilisation of school facilities, which are necessary to give effect to the new education legislation, curriculum changes (Outcomes-based Education) and the current challenges such as the HIV/AIDS pandemic.

Predictability and stability: This provision of the constitution is taken care of by the three year MTEF cycle and the publication of indicative figures per province in the DORA. Through this mechanism the DoE is given the opportunity to plan more effectively over a three year cycle. The business plans to access funding from the Poverty Relief Fund have also been prepared over a three year cycle.

Flexibility in responding to emergencies: Although business plans have been approved over a three year cycle, the DoE may apply for deviations to take care of changed circumstances and emergencies which could not be predicted at the time of planning. The National Treasury must however approve deviations. The deviations will however only be approved on condition that it is done within the agreed framework.

Question 2:

Trends in allocations, transfers and actual expenditure

The allocations for the three financial years were: 2001/02: R48-million; 2002/03: R34-million; and 2003/04: R64-million.

During the first year only R1,2-million was spent as a result of a tender process that took nine months. The tender was only awarded in December 2001. Of the R48-million, R13-million was rolled over. Expenditure at the end of January 2003 is R8,9-million. Estimated expenditure at the end of the 2002/03 financial year is R14-million. All the funds are, however, committed. Eight of the nine pilot schools are currently under construction. The construction of the last school will commence in March 2003. The design phase of the programme was completed and the construction is rolling out currently. The late completion of the first nine schools can be attributed to the following:
The extent of community participation is very time-consuming;
Skills training is also time-consuming;
Many of the projects/-sites originally identified by provinces were not approved owing to low learner enrolments. The identification of new appropriate sites was cumbersome and took several months.
The DoE learned that the design and construction of schools is a complicated and time-consuming activity and that the various processes cannot be rushed.

Table 11: Allocation and expenditure for Thuba Makote

Province

Allocation 2002/03
(million)

Expenditure 2002/03
(million)

Allocation 2003/04 (million)

CSIR

2,7

1,5

 

DoE

0,2

0,05

 

Eastern Cape

5,3

0,9

17,34

Free State

5,3

0,7

5,78

Gauteng

5,3

0,2

0

KwaZulu-Natal

5,3

0,6

17,34

Limpopo

5,3

1,4

11,56

Mpumalanga

5,3

1,3

5,78

Northern Cape

5,3

0,7

0

North West

5,3

0,5

5,78

Western Cape

5,3

0,5

0


The DoE has developed various processes to speed up the planned delivery in 2003/04.

Question 3:

Monitoring capacity and reporting

The DoE appointed a service provider to implement the project in close cooperation with the DoE. The service provider is charged with detailed design and implementation of the project. The implementation of the project is monitored and supported through steering groups drawn from provincial departments and appropriate other organisations. The service provider developed the approach and implements the project. The functions of the service provider include: a needs analysis of the selected locations, development of brief, development of tender documentation, appointment of contractors, training in construction skills (where required), site supervision (where required), administration of the contract, training and setting up of organisational structures (amongst others, helping define roles and responsibilities, accounting procedures, maintenance and management policies).

The service provider is required to work in a highly open and transparent way and to use a participatory approach to ensure that the community is fully involved in and supports the projects. The service provider includes Education and IT Specialists, Architects, Quantity Surveyors, Engineers, Agronomists and Training and Research organisations. The service provider provides the national DoE with regular reports on expenditure and on progress made with regard to expenditure and delivery.

The service provider is required to deliver the following reports:
(i) Monthly progress against milestones and expenditure against budget reports for the Thuba Makote Programme and approved projects, to be submitted to the programme manager of the DoE before or on the seventh day of each month.
(ii) Comprehensive quarterly reports.
(iii) A final report at the completion of the contract. The report must summarise the service provider’s activities during the contract period and must provide the DoE with recommendations on designs, space utilisation, building technology and sustainability that could be considered to improve management of similar ventures in future.

The service provider submits claims on a monthly basis. The DoE pays only for completed work. The DoE verifies the claims at the monthly progress meetings, and only if the documentation as mentioned below is included:

Fee claims:
Monthly progress reports according to the specifications.

Contractor disbursements:
Progress reports on construction, per project;
Progress reports on capacity-building programmes, per project;
Progress reports on project-related training, per project;
Verification certificates of completed construction work, per project;
Verification certificates of project-related training, per project; and,
Verification certificates of institutional capacity-building, per project.

Payments on claims are made only if the DoE is satisfied with the progress on the relevant phase and the claims for work done have been verified. Payment from the Department is within 14 days after the claims have been verified.

The service provider implements performance and quality assurance measures similar to those mentioned above when payments are made to contractors. Payments to contractors may be made only if the service provider is satisfied with the work done.

The service provider visits each project site regularly to monitor project progress and verify contractor claims (infrastructure and institutional development), and to ensure appropriate quality control.

Projects will also be visited by officials of the DoE for inspection of quality.

Question 4:

Qualitative and quantitative performance indicators

The first stage of the Thuba Makote Programme is currently being implemented. The CSIR was appointed as service provider for the first stage of the Thuba Makote Programme.

The tenders for the construction of the first eight schools, namely: Reaipela School in the Northern Cape; Zinoyosini School in the Eastern Cape; Jacob Mduli School in Mpumalanga; Thulani Primary School in Limpopo, the Mogale City High School in Gauteng, the Boitumelo Secondary School in the Free State, the Dirang ka Natla School in North West and the Bloekombos Secondary School in the Western Cape, have been awarded and construction of these schools is underway. The tender specifications for the Machibisa Primary School Project in KwaZulu-Natal are currently being prepared and the tender for the construction of the school will be awarded soon.

The programme has delivered outstanding dividends in terms of integrated delivery. The Department of Labour is providing skills training for unemployed people in the communities to enable them to participate in the construction of the schools. In future, the Department of Labour will also use the school facilities after school hours for skills training programmes for community members. SETA funding is being accessed for training unskilled people to enable them to participate in the construction of the schools. The Department of Agriculture participates in the programme by training the school and community members in establishing vegetable gardens at the schools to supplement the learners’ nutrition. The Department of Health assists by providing HIV/AIDS training sub-programmes.

Community involvement throughout the programme, beginning with the planning and design phase of each of the multi-functional schools, ensures community ownership of the schools. At each school, facilities such as workshops, sewing centres, Information Communication Technology Centres, media centres, catering facilities, communication hubs, and craft centres are included. Community members may use these facilities for income-generating activities. These schools are built according to new designs, which facilitate outcomes-based education and have larger sick bays to cater for HIV/AIDS affected learners. In addition to skills training, training is provided for school management, financial management, caring for HIV/AIDS affected community members, SMME development and facility management.

One of the lessons learned during the implementation of the first stage of the Thuba Makote Programme was that the identification, location, zoning, ownership and right of occupation of the Thuba Makote Schools’ sites were often problematic and caused delays in the implementation of the Programme. Community participation in the design, building and operation of the schools is at the core of the Programme and processes involving the participation of role-players are time-consuming.

Question 5:

Continuation of the Grant

The Grant will not be continued after 2003/04, since the understanding with Treasury was that this would be a once-off exercise. The DoE is not responsible for the actual delivery of school infrastructure. This was a pilot programme for the development of models for the provinces, components of which they could implement in their own future infrastructure delivery.

IKHWELO POVERTY ALLEVIATION PROJECT

Introduction

The Ikhwelo Project started in 1998 as a pilot project in the Eastern Cape and Limpopo provinces. The value of the project was $5m, funded by United States Agency for International Aid (USAID). Because of the lessons learnt from this project, it was then extended countrywide in 60 centres targeting skills development for learners at ABET levels 3-4 in Public Adult Learning Centres and Communities in the nodal areas. The project is funded from the Poverty Alleviation and Job Summit Allocation for the financial years 2001/02 to 2003/04. The project was allocated R110-million over a period of three years.

Question 1:

The formula and criteria used for allocating the Grant (2002/03 to 2005/06)

This allocation is from the Poverty Alleviation, Infrastructure and Job Summit Projects. The formula used for the allocation of the Grant to provinces is the education component of the equitable share. The education component of the Grant targets rural, semi-rural and urban areas in the nodal points. However, it would be difficult to quantify the number of learners, as some of the learners will be trained towards a General Education and Training Certificate, others towards a learnership, and yet others some in skills-related programmes only.

The Constitutional principles taken into account by the Grant

The Ikhwelo poverty Alleviation Grant addresses Section 214 of the Constitution which requires that the annual Division of Revenue Act is only enacted after account has been taken as set out in sub-section 214 (2) (a) to (j).

National interest and the division of resources: The Grant seeks to ensure that one out of the six Tirisano strategic programmes is implemented countrywide in the nodal areas. It alleviates poverty, creates job opportunities, and contributes towards the generation of skills and development of human capital in the country. It serves as the basis of the Human Resources Development Strategy and through location in the nodal areas addresses black economic empowerment. The allocation of the Grant to the DoE and to provinces is in kind and is based on the equitable share formula that ensures the different profiles of the provincial education departments are provided for.

Provision for debt costs: This provision is not applicable to the Grant.

National Government needs and interests: The Grant aims to serve national interests in the sense that the Tirisano programmes are determined nationally and implemented in all the nine provinces. All the Tirisano programmes encapsulated priorities set nationally but agreed to with the provinces, such as Adult Basic Education, which is a concurrent function and a constitutional right. It also addresses the "T" component of ABET.

Provincial government basic needs: The National DoE controls the fund, and contributes to the basic needs of the provinces by paying educators’ and co-ordinators’ salaries, procuring LSM, equipment and promoting skills through learnerships for communities to enable them to be self employed and employable. The Grant supplements the normal education budget in the provinces and in so doing assists in addressing poverty and basic needs of education in the provinces.

Fiscal capacity and efficiency: The Ikhwelo Project builds the capacity of Centre Governing Body members, Centre Managers, Project Coordinators and District Officials in developing financial management skills towards building fiscal capacity and efficiency. The Grant also ensures that the financial management systems are in place and are effective and efficient in all the provinces.

Developmental needs: The Grant assists in providing training for Centre Governing Body members, Centre managers, skills development in Agriculture and SMME to Educators and Learners and the officials at both provincial and district level and also provides learnerships in various skills such as venture creation, brick laying, primary agriculture and other related entrepreneurial skills for economic development.

Economic disparities: The formula used to allocate funding to provinces is in kind and part of the education component of the equitable share, which takes into account the disparities among provinces in terms of illiteracy rate and number of unemployed qualified educators. Nodal areas are given priority and they will take care of economic disparities of the country. The disparities within a province are partially addressed by the skewing of resources to nodal areas identified in the President’s State of the Nation Address.

Obligations in terms of national legislation: The priority programmes to be implemented through the Grant have been previously determined, piloted nationally and agreed with the provinces. It also addresses the ABET Act No. 52 of 2000.

Predictability and stability: This provision of the Constitution is taken care of by the three year MTEF cycle and the publication of indicative figures per province in the DORA. Through this mechanism the provinces are given the opportunity to not only plan over a three year cycle but to also plan more effectively for the future so that provinces are able to sustain the project.

Flexibility in responding to emergencies: Although business plans have been approved over a three year cycle, the National Department has the capacity to apply for deviations to take care of changed circumstances and emergencies which could not be predicted at the time of planning. The deviation will, however, only be approved on condition that it is done within the agreed framework and allocated in kind.

Question 2:

Trends in allocations, transfers and actual expenditure

Allocation

The allocations for the three financial years were: 2001/02 (R20m); 2002/03 (R40m) and 2003/04 (R50m) (see table below). The allocation of the funds was done according to the equitable share formula; funds were divided according to the rural and urban needs of each province.

Table 12: Allocations per province – 2001/02 to 2002/03

Province

2001/02

2002/03


R million

Proposed division
of funds

(1)


Proposed division
of funds

(2)

 

Rural

Urban

Rural

Urban

Eastern Cape

3 700 000

925 000

5 920 000

1 480 000

Free State

1 260 000

315 000

2 016 000

504 000

Gauteng

2 460 000

615 000

3936 000

984 000

KwaZulu-Natal

4 420 000

1 105 000

7072 000

1 768 000

Mpumalanga

1 460 000

365 000

2 336 000

584 000

Northern Cape

380 000

95 000

608 000

152 000

Limpopo

3 140 000

785 000

5 024 000

1 256 000

North West

1 600 000

400 000

2 560 000

640 000

Western Cape

1 580 000

395 000

2 528 000

632 000

Total

20 000 000

5 000 000

32 000 000

8 000 000


Table 13: Allocation per province – 2003/04

Province

2003/04


R million

Proposed division
of funds

(1)

 

Rural

Urban

Eastern Cape

7 400 000

1 850 000

Free State

2 520 000

630 000

Gauteng

4 920 000

1 230 000

KwaZulu-Natal

8 840 000

2 210 000

Mpumalanga

2 920 000

730 000

Northern Cape

760 000

190 000

Limpopo

6 280 000

1 570 000

North West

3 200 000

800 000

Western Cape

3 160 000

790 000

Total

40 000 000

10 000 000


Transfers:

As far as this programme is concerned transfers are done in kind as soon as the tenders for training educators, procuring equipment and LSM are approved. The schedule depends on the procurement process.

Actual expenditure

During the first allocation of 2001/02 financial year, R750 000 was spent on procurement of materials. The rest of the funds were then lost to National Treasury.

The second financial year, 2002/03 was meant for the employment of educators and project coordinators. Posts were advertised, unfortunately, it took 11 months before the posts could be filled. However, the posts have been filled and project coordinators and educators have started with the placement of learners at appropriate levels.

Strategy for 2003/04

Learners and educators will be in the classrooms.
Centre Governing Body members, centre managers, district officials and project co-ordinators will be trained on project management.
Agricultural equipment will be procured and distributed.
Entrepreneurship equipment will be procured and distributed to centres.
Communities will be trained on various learnerships such as primary agriculture, brick laying, venture creation for economic development.

Reasons for not spending can be attributed to the following reasons:

During year one, permission to use the Grant was granted on 9 August 2001. The Department only managed to procure materials worth R750 000.
It took almost 11 months to appoint 240 educators and 10 co-ordinators after the posts had been advertised.

The Department has developed various processes and educators have started work and planned delivery for 2003/04 has started. Their salary scales are as follows:
Table 14: Preliminary salary estimations

PROVINCE

LIM

GDE

E/C

N/C

W/C

KZN

MPU

N/W

F/S

TOTAL

CO-ORDINATOR

1

1

NOT YET ON DUTY

1

1

NOT YET ON DUTY

NOT YET ON DUTY

1

1

6

EDUCATORS ON DUTY

30

16

50

20

13

33

16

24

23

225

TOTAL

31

16

50

21

14

33

16

25

24

230

 

 

 

 

 

 

 

 

 

 

 

CO -ORDINATORS SALARIES

145 179

145 179

_

145 179

145 179

_

_

145 179

145 179

871 074

EDUCATORS SALARIES

1 349 280

719 616

2 248 800

899 520

584 688

1 484 208

719 616

1 079 424

1 034 448

10 119 600

 

 

 

 

 

 

 

 

 

 

 

EDUCATORS WHO HAVE RESIGNED

2

4

_

_

3

7

4

_

_

18


Estimated payment over 6 months: R10 990 674 X 6 = R65 944 044.00
(Please note: estimation is based on educators who have already assumed duty)


Question 3:

Monitoring capacity and reporting

In order to comply with the requirements of the Division of Revenue Act, 2002, monitoring capacity and reporting ought to be adhered to, unfortunately this happened to be the case:

No monitoring took place because there was no spending in 2001/02.
Educators and project coordinators started working in January 2003. Therefore, reports have been developed and submitted by project co-ordinators on a monthly basis.
The directorate visited centers in KwaZulu-Natal and the Northern Cape in January to February 2003.
The Grant is also monitored through inter-provincial meetings on all conditional grants held quarterly in the DoE.
CEM and HEDCOM tracks expenditure and they meet bimonthly.

Question 4:

Qualitative and quantitative performance indicators

In initiating the project, many challenges were identified, mostly arising from the weak state of the ABET system. Management processes needed to be set up in order to implement the project successfully, and the establishment of these management processes delayed the implementation of the project, and money for the 2001/02 financial year was rolled back to Treasury.

Although in terms of the framework, there were qualitative and quantitative indicators, the Ikhwelo Project was not implemented in 2001/02 financial year, so there is nothing to report on. However, the Department will monitor the indicators during the 2003/04 financial year and report accordingly.

Question 5:

Continuation of the Grant

The Ikhwelo Project is a poverty alleviation project and has raised learners’ and educators’ expectations that they will be trained in skills and reduce poverty in the nodal areas as planned. The recommendation for the retainment of the Grant is as follows:

The Grant was introduced in the 2001/02 financial year and was to be phased out in 2003/04 financial year. The Department proposes that the Grant be retained to consolidate the achievements to be gained now that implementation has started, educators and project co-ordinators employed and learners recruited.
The impact of the project will only be realized after the 2003/04 financial year.
This will give provinces time to plan for sustainability of the project.
Capacity building for both national, provincial and local government officials and communities will be realized.

conclusion

The conditional grants are an effective tool to ensure that policies enacted by the DoE are implemented at provincial level. In addition, the Grants provide the DoE with the opportunity to exercise the oversight role. Although cumbersome to administer, particularly in the first year, they are a useful tool and should be continued.