National Department of Health Presentation to the Standing Committee on Appropriations Public Hearings on the Adjustments Appropriation Bill 05 November 2010

CONTENTS Adjustment Budget. Expenditure as at 30 September Conditional Grants. Conclusion.

The budget for NDOH will be adjusted from R21,5 billion to R21,6 billion due to increase of R164,5 million. The National Department of Health agree with proclamation of the Adjustments Appropriation Bill. Adjustment Budget

Adjustment Budget Cont… An amount of R49,8 million was for funds rolled over for the following: R11 million for the installation of information technology infrastructure in the newly refurbished Civitas Building. R3,2 million for 2010 FIFA World Cup unspent funds. The funds are however committed. R17 million on Hospital Revitalization for improved programme management (R12 million ) and Health Technology and management Audits (R5m).

Adjustment Budget Roll over Cont… Tuberculosis Day Event for R1,2 million. H1N1 Influenza Vaccines R4,4 million. Audit of primary health care facilities for the amount of R5 million. District Health Information systems for the amount of R8 million.

Adjustment Budget Additional Allocations. Salary and Housing Allowance increase for R9,7 million based on the new wage agreement. Unforeseeable and Unavoidable Expenditure to the amount of R105 million: Comprehensive HIV and AIDS Grant , R40 million. National: Distribution of Condoms, R60 million. Medicines Control Council (MCC) to Support its turnaround strategy , mainly on staffing and to address backlogs in medicines registration, R5 million.

Adjusted Estimates of National Expenditure Programme R,000 Main Appropriation Roll-Overs Unforeseeable/Unavoidable Virements and Shifts Other Adjustements Total Adjustements Adjusted Appropriation Administration 264,834 11,000   3,600 2,700 17,300 282,134 Strategic Health Programme 7,294,902 5,624 100,000 1,100 106,724 7,401,626 Health Planning and Monitoring 406,933 3,203 1,000 3,500 7,703 414,636 Health Human Resources Management and Development 1,897,051 500 1,897,551 Health services 11,528,757 30,000 -3,600 1,900 28,300 11,557,057 International Relations, Health Trade and product Regulation 104,508 5,000 -1,000 4,000 108,508 GRAND TOTAL 21,496,985 49,827 105,000 9,700 164,527 21,661,512

CURRENT EXPENDITURE AS AT 30 SEPTEMBER 2010 Target as at September 50% Actual is at 49,30% The improvement of condition of service (salary increase) will only reflect in November

Programme 1: Administration ECONOMIC CLASSIFICATION BUDGET R'000 ACTUAL EXPENDITURE VARIANCE EXPENDITURE IN PERCENTAGES Current Payments 257,677 106,162 151,515 41.20% Compensation of Employees 111,709 50,031 61,678 44.79% Goods and Services 145,968 56,131 89,837 38.45% Transfers and Subsidies 370 535 (165) 144.59% Capital Payments 6,787 2,081 4,706 30.66% GRAND TOTAL 264,834 108,778 156,056 41.07%

Programme 2: Strategic Health Programme ECONOMIC CLASSIFICATION BUDGET R'000 ACTUAL EXPENDITURE R'000 VARIANCE R'000 EXPENDITURE IN PERCENTAGES Current Payments 441,323 184,807 256,516 41.88% Compensation of Employees 89,483 40,876 48,607 45.68% Goods and Services 351,840 143,931 207,909 40.91% Transfers and Subsisdies 6,837,256 3,314,021 3,523,235 48.47% Capital Payments 16,323 2,878 13,445 17.63% GRAND TOTAL 7,294,902 3,501,706 3,793,196 48.00%

Programme 3: Health Planning and Monitoring ECONOMIC CLASSIFICATION BUDGET R'000 ACTUAL EXPENDITURE R'000 VARIANCE R'000 EXPENDITURE IN PERCENTAGES Current Payments 126,027 45,891 80,136 36.41% Compensation of Employees 64,647 29,138 35,509 45.07% Goods and Services 61,380 16,753 44,627 27.29% Transfers and Subsisdies 277,839 135,264 142,575 48.68% Capital Payments 3,067 2,944 123 95.99% GRAND TOTAL 406,933 184,099 222,834 45.24%

Programme 4: Health Human Resources Management and Development ECONOMIC CLASSIFICATION BUDGET R'000 ACTUAL EXPENDITURE R'000 VARIANCE EXPENDITURE IN PERCENTAGES Current Payments 31,137 14,654 16,483 47.06% Compensation of Employees 17,211 7,265 9,946 42.21% Goods and Services 13,926 7,389 6,537 53.06% Transfers and Subsidies 1,865,387 955,328 910,059 51.21% Capital Payments 527 59 468 11.20% GRAND TOTAL 1,897,051 970,041 927,010 51.13%

Programme 5: Health Services ECONOMIC CLASSIFICATION BUDGET R'000 ACTUAL EXPENDITURE R'000 VARIANCE R'000 EXPENDITURE IN PERCENTAGES Current Payments 103,103 30,405 72,698 29.49% Compensation of Employees 43,900 20,267 23,633 46.17% Goods and Services 59,203 10,138 49,065 17.12% Transfers and Subsidies 11,422,419 5,774,903 5,647,516 50.56% Capital Payments 3,235 1471 1,764 45.47% GRAND TOTAL 11,528,757 5,806,779 5,721,978 50.37%

EXPENDITURE IN PERCENTAGES Programme 6: International Relations, Health Trade and product Regulation ECONOMIC CLASSIFICATION BUDGET R'000 ACTUAL EXPENDITURE R'000 VARIANCE EXPENDITURE IN PERCENTAGES Current Payments 103,732 27,483 76,249 26.49% Compensation of Employees 42,754 18,636 24,118 43.59% Goods and Services 60,978 8,847 52,131 14.51% Transfers and Subsidies 100 (100)   Capital Payments 776 62 714 7.99% GRAND TOTAL 104,508 27,645 76,863 26.45%

Expenditure Summary per Programme BUDGET R'000 ACTUAL EXPENDITURE R'000 VARIANCE EXPENDITURE IN PERCENTAGES Administration 264,834 108,778 156,056 41.07% Strategic Health Programme 7,294,902 3,501,706 3,793,196 48.00% Health Planning and Monitoring 406,933 184,099 222,834 45.24% Health Human Resources Management and Development 1,897,051 970,041 927,010 51.13% Health services 11,528,757 5,806,779 5,721,978 50.37% Internation Relations, Health Trade and product Regulation 104,508 27,645 76,863 26.45% GRAND TOTAL 21,496,985 10,599,048 10,897,937 49.30%

Expenditure Summary per Economic Classification BUDGET R'000 ACTUAL EXPENDITURE R'000 VARIANCE EXPENDITURE IN PERCENTAGES Current Payments 1,062,999 409,402 653,597 38.51% Compensation of Employees 369,704 166,213 203,491 44.96% Goods and Services 693,295 243,189 450,106 35.08% Transfers and Subsidies 20,403,271 10,180,151 10,223,120 49.89% Capital Payments 30,715 9,495 21,220 30.91% GRAND TOTAL 21,496,985 10,599,048 10,897,937 49.30%

Analysis of Expenditure. The target of expenditure for end of September 2010 was 50%, the NDOH achieved 49,30%. There was under spending of 1,7 % which was attributed to: Compensation of Employees (COE) delay in finalizing wage agreement. The expenditure will pick up at end of Nov. as the matter is now finalized. Accruals amounting to R30m are still to be paid. This should influence the actual expenditure percentage positively, once paid. Capital expenditure funding is being reviewed to address the turnaround strategy for the current IT challenges in the Department.

CONDITIONAL GRANTS REPORT 30 SEPTEMBER 2010

COMPREHENSIVE HIV AND AIDS Province Division of Revenue Act, 2010 (Act No. 1 of 2010) Payment Schedule: Year to date Received by province: Year to date Provincial actual payments % Transferred of national allocation % Actual payments of total available Projected outcome for financial year Projected (over)/under R thousand Eastern Cape 690,940 335,546 278,308 48.6% 40.3% 412,632 Free State 433,583 216,792 147,905 50.0% 34.1% - Gauteng 1,277,683 636,536 614,154 49.8% 48.1% KwaZulu-Natal 1,498,811 694,371 548,336 46.3% 36.6% Limpopo 514,896 257,448 250,505 48.7% 557,804 (42,908) Mpumalanga 383,646 183,831 173,329 47.9% 45.2% 390,147 (6,501) Northern Cape 182,306 107,426 66,893 58.9% 36.7% North West 475,838 237,918 186,731 39.2% 478,809 (2,971) Western Cape 554,054 284,365 219,248 51.3% 39.6% Total 6,011,757 2,954,233 2,485,409 49.1% 41.3% 5,651,505 360,252

FORENSIC PATHOLOGY SERVICES Province Division of Revenue Act, 2010 (Act No. 1 of 2010) Payment Schedule: Year to date Received by province: Year to date Provincial actual payments % Transferred of national allocation % Actual payments of total available Projected outcome for financial year Projected (over)/under R thousand Eastern Cape 69,345 39,750 25,622 57.3% 36.9% 43,723 Free State 37,218 16,405 14,052 44.1% 37.8% - Gauteng 92,421 47,478 38,454 51.4% 41.6% KwaZulu-Natal 152,406 76,202 94,590 50.0% 62.1% Limpopo 39,913 20,500 19,751 49.5% 43,113 (3,200) Mpumalanga 50,107 24,459 15,597 48.8% 31.1% 50,277 (170) Northern Cape 22,868 12,500 9,289 54.7% 40.6% 21,209 1,659 North West 26,433 13,216 10,712 40.5% Western Cape 66,251 35,788 45,036 54.0% 68.0% 73,653 (7,402) Total 556,962 286,298 273,103 49.0% 522,352 34,610

HEALTH PROFESSIONS TRAINING AND DEVELOPMENT Province Division of Revenue Act, 2010 (Act No. 1 of 2010) Payment Schedule: Year to date Received by province: Year to date Provincial actual payments % Transferred of national allocation % Actual payments of total available Projected outcome for financial year Projected (over)/under R thousand Eastern Cape 160,444 80,220 22,296 50.0% 13.9% 138,148 Free State 117,400 58,698 63,402 54.0% - Gauteng 651,701 325,848 325,849 KwaZulu-Natal 235,771 117,882 101,267 43.0% Limpopo 94,085 62,280 59,142 66.2% 62.9% 99,925 (5,840) Mpumalanga 76,149 46,500 32,863 61.1% 43.2% 77,550 (1,401) Northern Cape 61,802 29,882 20,022 48.4% 32.4% North West 83,324 41,664 37,448 44.9% 83,899 (575) Western Cape 384,711 192,354 Total 1,865,387 955,328 854,643 51.2% 45.8% 1,735,055 130,332

HOSPITAL REVITALIZATION Province Division of Revenue Act, 2010 (Act No. 1 of 2010) Payment Schedule: Year to date Received by province: Year to date Provincial actual payments % Transferred of national allocation % Actual payments of total available Projected outcome for financial year Projected (over)/under R thousand Eastern Cape 360,660 195,115 88,746 54.1% 24.6% 271,914 Free State 378,426 200,558 62,860 53.0% 16.6% 245,589 132,837 Gauteng 798,609 435,606 391,395 54.5% 49.0% - KwaZulu-Natal 500,815 179,834 100,813 35.9% 20.1% 300,815 200,000 Limpopo 323,425 159,093 88,713 49.2% 27.4% 346,582 (23,157) Mpumalanga 331,657 190,095 166,568 57.3% 50.2% 371,875 (40,218) Northern Cape 420,218 176,741 122,147 42.1% 29.1% 350,061 70,157 North West 326,303 216,182 193,508 66.3% 59.3% 376,303 (50,000) Western Cape 580,554 320,053 271,955 55.1% 46.8% 608,287 (27,733) Total 4,020,667 2,073,277 1,486,705 51.6% 37.0% 3,486,867 533,800

INTERVENTIONS FOR THE REVITE GRANT. Projected R542 million under expenditure including provincial roll overs has been confirmed with the provinces. Business plans have been revised and the funds are being redirected for other projects within the same framework. Treasury is being consulted regarding provinces which show projected over expenditure to receive additional funding from the projected under expenditure.

NATIONAL TERTIARY SERVICES Province Division of Revenue Act, 2010 (Act No. 1 of 2010) Payment Schedule: Year to date Received by province: Year to date Provincial actual payments % Transferred of national allocation % Actual payments of total available Projected outcome for financial year Projected (over)/under R thousand Eastern Cape 557,137 278,568 324,251 50.0% 58.2% 232,886 Free State 659,469 329,736 292,750 44.4% - Gauteng 2,561,154 1,280,580 KwaZulu-Natal 1,102,585 551,292 503,681 45.7% Limpopo 257,314 128,658 123,139 47.9% 278,757 (21,443) Mpumalanga 91,879 45,942 28,940 31.5% Northern Cape 225,948 112,974 86,226 38.2% North West 179,280 89,640 54,383 30.3% Western Cape 1,763,234 881,616 Total 7,398,000 3,699,006 3,575,566 48.3% 7,186,557 211,443

SUMMARY OF HEALTH CG GRANTS Province Division of Revenue Act, 2010 (Act No. 1 of 2010) Payment Schedule: Year to date Received by province: Year to date Provincial actual payments % Transferred of national allocation % Actual payments of total available Projected outcome for financial year Projected (over)/under R thousand Eastern Cape 1,838,526 929,199 739,223 50.5% 40.2% 1,099,303 Free State 1,626,096 822,189 580,969 50.6% 35.7% 1,493,259 132,837 Gauteng 5,381,568 2,726,048 2,650,432 50.7% 49.3% - KwaZulu-Natal 3,490,388 1,619,581 1,348,687 46.4% 38.6% 3,290,388 200,000 Limpopo 1,229,633 627,979 541,250 51.1% 44.0% 1,326,181 (96,548) Mpumalanga 933,438 490,827 417,297 52.6% 44.7% 981,728 (48,290) Northern Cape 913,142 439,523 304,577 48.1% 33.4% 841,326 71,816 North West 1,091,178 598,620 482,782 54.9% 44.2% 1,144,724 (53,546) Western Cape 3,348,804 1,714,176 1,610,209 51.2% 3,383,939 (35,135) Total 19,852,773 9,968,142 8,675,426 50.2% 43.7% 18,582,336 1,270,437

Management and Monitoring of Conditional Grants Monthly meetings are being held within the Department with the DG and the grant managers to review progress made and to advise and suggest for interventions where applicable. More work still needs to be done at grant level to monitor performance and the grant indicators in terms of the approved business plans. Relevant DDGs are urged to ensure quality of reports submitted on the performance of the grants.

Conclusion. The challenge for NDOH is ensuring that the 91% grant funds achieve objectives, targets and goals intended. ( part of performance measurement)