Department of Environmental Affairs Overview of mandate, functions, concepts and financial environment ….Ms N Ngcaba

Department of Environmental Affairs Foundational Mandate = Sustainable Development Constitutional mandate (Sec 24) – 3 SD elements: Social - environment – not harmful to health or well- being; “…while promoting justifiable … social development. Environmental – protect the environment, for the benefit of present and future generations, through legislative / other measures that - –prevent pollution and ecological degradation; –promote conservation; and Economic – secure ecologically sustainable development and use of natural resources while promoting justifiable economic … development.”

Environmental Affairs Mandate Environmental Quality and Protection: –impact management, –Pollution and waste management, –air and atmospheric quality, –Climate Change –Meteorological and related Services. Biodiversity and Conservation: –Conservation of land and sea scapes –Protected areas –Biodiversity management Marine and coastal management –Marine resource management –Monitoring control & surveillence –research

Environmental Impact Assessment (EIA) – An assessment of suitability of a development project in a particular natural environment. Record of decision (RoD) – Certification of approval of a development by an approval authority (Minister) with/without condition. Impact Management:- Prevent and manage potentially negative development impact on the environment through amongst others:- Development and implementation of policy and legislative framework for environmental impact management, Processing of Environmental Impact Assessments (EIA’s), Building environmental impact management capacity, Ensure compliance to conditions of EIA records of decisions (RoD) and prevent unauthorized development (role of Environmental Management Inspectorate or “green scorpion” – the environmental police). Environmental Quality and Protection

Environmental Quality Management Pollution and Waste Management: Development and implementation of policy, legislation, norms and standards for pollution and waste management, Promote reduction, reuse and recycling (through Buyisa-e-bag) of waste Processing of applications for development of waste management infrastructure (this is now linked to impact management processes to avoid duplication), Develop capacity for pollution and waste management, Promote the implementation of polluter pays principle Pollution – contamination of an environment (land, water and air) – e.g. use of pesticides, mine waste, Waste – by product of consumption process that may no longer be used in the same production chain. Reduce, reuse and recycle … are commonly applied global principles on waste management – cradle to grave,

Environmental QualityManagement Air and atmospheric quality: Improve state of ambient air quality: Development and implementation of policy, legislation, norms and standards for air quality; Ambient Air quality management capacity development, Monitoring of ambient air quality and monitoring infrastructure development support, Ozone layer protection, Ensure adherence to ambient air quality standards. Ambient Air quality – Air above the earth surface meeting specified standards/not polluted (by gases emitted from industrial or household processes beyond certain limits) Ozone layer - is a layer of gas in the upper atmosphere which protects humans and other living things from the harmful ultraviolet (UV-B) rays of the sun.

Environmental Quality and protection Climate Change Climate change mitigation and adaptation policy development and research coordination. Climate Change – refers to a long-term change in weather patterns over durations of time ranging from decades to millions of years due to increases in concentrations of greenhouse gases, etc. Mitigations – To take action that will reduce greenhouse gas emissions in the atmosphere, acidification of the oceans resulting in sea-level rise phenomenon, etc Adaptation – finding ways to be able to survive the occurrence of natural disasters linked to variations in climatic conditions

Meteorological and related Services (South African Weather Services - SAWS): Timely dissemination of the weather forecast information – linked to prevention of natural disasters and also to allow for long and short term planning (e.g. agriculture and aviation safety), Ensure accuracy of the weather forecast information, Ensure good state of weather forecasting infrastructure (radars, lighting detectors, software etc), maintanance Meteorological – relates to the study of the changes in temperature, air pressure, moisture, and wind direction in the atmosphere. Aviation - refers to activities involving man-made flying devices (aircraft)

Biodiversity and Conservation Promote conservation and sustainable utilization of natural resources:- Conservation of land and sea scapes: Declaration of National terrestrial and marine protected areas to conserve ecosystems, Protected areas: Management of National protected areas through South African National Parks – SANParks and iSimangaliso Wetland Park Authority) – 23 National Parks and iSimangaliso Wetland Park (1 st World Heritage Site in South Africa), Biodiversity management: Mitigation of threats to biodiversity, Build a sound scientific base for effective management of natural resources in partnership with South African Biodiversity Institute (SANBI) which also manages botanical gardens (9 gardens)., incl a network of scientific authorities falling under DST, (CSIR, NRF, Universities, etc) Biodiversity – describes the variety of life in an area, including the number of different species, the genetic wealth within each species,...plant life, animal life, ocean life,… Conservation – protection and preservation of the ecological resources for future generations Terrestrial – in land Marine – in ocean

Marine and Coastal Management – Marine living Resources Fund (MLRF) Promote conservation and sustainable utilization of marine and coastal resources:- –Allocation of fishing rights, –Marine research to ensure resources sustainability, –Prevention of illegal access to resources, –Maintain good quality of marine and coastal environment.(preventing pollution of ocean environment)

FINANCES

Topics For Discussion State of budgeting environment per MTEF guidelines Strategic Risks identified per MTEF Review of baseline adjustments Prior years & MTEF Expenditure trends Projected own Revenue generation & constraints Challenges identified in MTEF allocations and projected budget constraints Transfers to Public Entities & Audit Opinions

State of Budgeting Environment Global recession and weaker economic conditions Required responses per National Treasury Guide. Rigorous baseline assessment Detailed costing of policy proposals at activity level Value for money assessment Reprioritisation and Alternative funding mechanisms for infrastructure project e.g. Public Private Partnership (PPP) Scenario and risk analysis Coordinated planning with public entities Implementation readiness Identification of new outputs and development of Monitoring & Evaluations plans.

Strategic Risks Identified Contributory Factor/s Risk Description Shrinking Purse & Global recession -Anticipated further Financial constraints -Reduction of MTEF allocations by National Treasury -Possible decrease in Donor Funds -Insufficient funding of establishment Restructuring and split Possible In-Equitable allocation of resources

Review of Baseline Allocation Trends 2009/10 ‘ /11 ‘ /12 ‘000 Baseline Requested Initial allocation Total allocated Further cuts Jan 09 ( ) (42 990) (48 641) Final allocation % Baseline Increase.01% 3.2% 14.8%

Prior Years Expenditure Patterns ProgrammeAudited Outcome (Unqualified) 2006/2007 R’ /2008 R’ /2009 R’ Administration Environmental Quality and Protection Marine and Coastal Management Tourism Biodiversity and Conservation Sector Services and International Relations Total An average annual spend of 99.8% was achieved

Economic Classification- MTEF Trends Economical ClassificationAudited Financial year05/06 R’000 06/07 R’000 07/08 R’000 08/09 R’000 Compensation of Employees Goods and Services Transfers: Departmental Agencies and Accounts Transfers: Foreign Governments Transfers: Non Profit Organisations Transfers: Households Capital Assets Total

Economic Classification- MTEF Trends Economical ClassificationMedium Term Expenditure Estimate Financial year2009/2010 R’ /2011 R’ /2012 R’ /2013 R’000 Compensation of Employees Goods and Services Transfers: Departmental Agencies and Accounts Transfers: Foreign Governments9 000 Transfers: Non Profit Organisations Transfers: Households Capital Assets Total

Donor Funds Trends Donor/ProjectAudited Outcome (Unqualified) Programmes & Projects 2005/2006 R’ /2007 R’ /2008 R’ /2009 R’000 Norway: Environmental Cooperation Norway: Marine Fisheries Cooperation Denmark: Air Quality Management Denmark: Urban Environmental Programme Denmark: Environmental Capacity Building Denmark: National Waste Management World Bank: African Stockpile Total

Donor Funds Trends Donor/ProjectMedium Term Expenditure Estimate Programmes & Projects2009/2010 R’ /2011 R’ /2012 R’ /2013 R’000 Norway: Environmental Cooperation Norway: Marine Fisheries Cooperation Denmark: Air Quality Management Denmark: Urban Environmental Programme Denmark: Environmental Capacity Building ---- Denmark: National Waste Management ---- World Bank: African Stockpile Total

Challenges Identified ChallengeImplications 99.8 % expenditure trends Possible future decline in donor funds (from R37 million 2008/9 to R4 million 2012/13) Lean margin of safety - for commitments, accruals including unforeseeable & unavoidable expenses Future Pressure on MTEF, negative impact on service delivery including delays in projects. Avoidance of unauthorised expenditure-reduced Operational and Capital expenditure (OPex & CAPex ) plans – Strategic expenditure (Stratex) implications Continuous reprioritisation & budget trade offs, & rationalisation – with possible audit implications Less flexibility in funding for multi year projects and contracts. Funding of new programs, projects, structure changes Possible establishment short funding, & increase in vacancy rate -capacity constraints Internal & external co- ordination of projects Specialized service delivery consultants - possible budget shortfalls Audit opinion integrityPossible Audit Exposures in the 99.8% expenditure trends and Performance Audit Exposure

Expenditure Trends over the MTEF period /062006/072007/082008/092009/102010/112011/122012/13 Years R'000

Increase in Expenditure Trends – overall Department Average Percentage increase of 21,8% - ( from R1,8 billion to R3,2 billion) years 2005/6-2008/9 Infrastructure Development in: National Parks, Botanical Gardens, Weather Service, replacement of the supply and research vessels for the Antarctica and the Marion and Gough islands. Poverty relief projects Increase in Environment, Conservation & Marine mandates Transfers and subsidies to departmental agencies Increases to the baseline accounts for the following: - Establishment increase, operations, and accommodation, Inflation adjustments, baseline adjustments, Climate Change research, policy development and implementation and Buyisa-e-Bag (S21 implementing plastic bag regulations)

Programme 2: Air Quality & Protection Expenditure increase from R185,287 million in 2005/2006 to R363,395 million in 2012/2013 Programme expanded from a regulatory phase to an implementation phase which includes the following: Regulatory Services Pollution and Waste Management Environmental Impact Management Air Quality Management and Climate Change Increase in Expenditure Trends per Programme continued:

Expenditure Trends continued: Programme 3 Marine & Coastal Management Increase from R262,428 million in 2005/2006 to R1 027,982 million in 2012/2013 Increase due to provision for the replacement of the polar vessel which will commence during the 2009/10 financial year Programme 5: Biodiversity and Conservation Increase from R283,195 million in 2005/2006 to R487,137 million in 2012/2013 for establishment of the Transfontier (“boundless” protected areas) conservation initiative Transfer Payments to the following Public Entities: South African National Parks, South African National Biodiversity Institute and iSimangaliso Wetland Park Authority Programme 6: Sector Services & International Relations Expenditure increase from R473,321 million in 2005/2006 to R1 345,701 million in 2012/2013 for Poverty relief programmes linked to Expanded Public Works Programme (EPWP) and Infrastructure Programme.

Transfers: Public Entities & Audit Opinions Public EntityAudited Outcome (Unqualified) (Qualified) 2005/2006 R’ /2007 R’ /2008 R’ /2009 R’000 South African Weather Service South African Tourism Marine Living Resources Fund South African National Parks South African National Biodiversity Institute iSimangaliso Wetland Park Authority Total

Transfers: Public Entities & Audit Opinions Public EntityMedium Term Expenditure Estimate 2009/2010 R’ /2011 R’ /2012 R’ /2013 R’000 South African Weather Service South African Tourism Marine Living Resources Fund South African National Parks South African National Biodiversity Institute iSimangaliso Wetland Park Authority Total

Way forward including risk mitigation Continued anticipation of possible short funding in outer years Application of efficiency models across all expenditure items. Re-statement or re- costing of baseline Targeting costs that carry thru MTEF for efficiency models e.g. short term contracts, projects, maintenance costs etc. Alternate Funding Initiatives & Increase in Revenue Exploring more co-funding mechanisms for external projects- where possible. Timing of Infrastructure and Capital Projects Expenditure:- Providing for possible cost increases in existing project costs for the current year. Consider delaying new projects -in the absence implementation readiness and budget. Maintaining clean audits (Financial & Performance) Avoiding of unauthorised expenditure or budget overrun thru more tightening of budget management and due consideration for inflationary costs. Maintaining the balance between MTEF, Strategic Plan deliverables for the performance audit opinion due in (2010).

THANK YOU