1. DCoG Presentation to the Appropriations Committee HEARINGS ON THE MEDIUM TERM BUDGET POLICY STATEMENT 2 November 2010

2. Purpose of the presentation To outline DCoG’s spending priorities for the 2011 MTEF as well as substantial adjustments to conditional grants allocations; and To present the actual spending of DCoG for the first 6- months of 2010/11 financial year.

3. Differentiated approach Access to basic services Support LabourServicesFinanceServicesFinance Community Work Programme DCoG MTEF Budget Priorities: Focus on Outcome 9 3 Support to Human Settlements Refined Ward Committee Model Municipal Finance & Administration Single window of coordination

4. Transfers to Municipalities MUNICIPAL INFRASTRUCTURE GRANT - A requested has been provided for the approval for an additional R16.9 billion as an increase to the baseline allocation of the Municipal Infrastructure Grant for the 2011 MTEF, in order to meet sector targets to eradicate infrastructure backlogs. BULK INFRASTRUCTURE FUND (BIF) -To unlock the delivery of reticulation services by funding bulk infrastructure and procuring well located land towards addressing backlogs in order to ensure universal access to basic services. The BIF will also be utilised to upgrade, refurbish and rehabilitate bulk infrastructure such as Water and Waste Water Treatment Works. LOCAL GOVERNMENT EQUITABLE SHARE (LGES) –This is to complement the institutional component of the LGES by funding critical skills in municipalities, prioritising water and sanitation over the MTEF in order to build long-term municipal institutional capacity through the proposed reconfigured Municipal Systems Improvement Systems Grant (MSIG) into the Local Government Institutional and Systems Support Grant. (LGISSG). –

5. Transfers To Municipalities R’0002011/122012/132013/14MTEF Municipal Infrastructure Grant5,000,0005,700,0006,200,00016,900,000 Bulk Infrastructure Fund6,619,8568,895,25310,826,79526,300,000 Local Government Equitable Share 1,334,7631,408,1751,478,5844,221,522

6. Additional Funding Requests to the Baseline R’0002011/122012/132013/14MTEF 1. Special Purpose Vehicle 100,000110,000121,000331,000 2. Disaster Management 140,000 420,000 3. Implementation of the Master Systems Plan for the National Disaster Management Plan 67, 940293, 33571, 816433, 091 4. Municipal Infrastructure Audit 200100-300 5. Local Government Turnaround Strategy 25,00028,00032,00085,000 6. Township Renewal Prog 8,0008,8009,00025,800

7. Additional Funding Requests to the Baseline (1/2) 1.Special Purpose Vehicle –The purpose of establishing a Special Purpose Vehicle is to create focussed capacity for the delivery and rehabilitation of infrastructure with the main focus on low capacity municipalities to ensure the sustainable provision of municipal infrastructure towards the achievement of service delivery targets and the Millennium Development Goals. –The Special Purpose Vehicle will be responsible for municipal infrastructure planning, delivery and rehabilitation; the provision of technical support to enable municipalities to deliver infrastructure in a sustainable way and monitoring of municipalities performance in relation to infrastructure delivery and management. 2.Disaster Management –Since the promulgation of the Disaster Management Act, 57 of 2002 unsatisfactory progress has been made with the establishment of disaster management centres throughout the country. The requested funding is to establish the centres in 27 district municipalities and the Northern Cape province. 3.Implementation of the Master Systems Plan for the National Disaster Management Plan –To create and implement Information Technology and Communication Systems capability of the National Disaster Management Centre (NDMC) in support of the implementation of the Disaster Management Act.

8. Additional Funding Requests to the Baseline (2/2) 4.Implementation of the Master System Plan for the National Disaster Management Plan –To create and implement Information Technology and Communication Systems capability of the National Disaster Management Centre (NDMC) in support of the implementation of the Disaster Management Act. 5.Municipal Infrastructure Audit –The project is intended to assess the status of municipal infrastructure in the country through an audit. This would assist government to know what needs be done about the municipal infrastructure. 6.Local Government Turnaround Strategy –To assist in implementing Outcome 9 and the municipal turn around strategies. 7.Township Renewal Prog –To provide practical hands on support to municipalities in implementing economic development initiatives towards regeneration of small towns.

10. Program expenditure Trends (April – Sept 2010) The lower spending within Program 2: Policy, Research and Management Support are related to slow spending within newly created sub-programs like Knowledge Management as they are still being established and also the vacancies within the Program. We also received roll-over funds for the new computer services within the Department of Traditional Affairs to the value of R2.4 million which is not yet spent. The low spending of 5% within Payments for Capital Transfers is due to the delay for the procurement of office furniture for the new Department of Traditional Affairs.