Thank you, Chairperson. The Money Bills Amendment Procedure and Related Matters Act mandates the Select Committee on Appropriations to monitor and evaluate conditional grant allocations to provinces and local government and the expenditure thereof. This is the oversight role that everybody cries for.
In fulfilling this function, the Select Committee on Appropriations held hearings in all nine provincial sport and recreation departments on the Mass Sport and Recreation Participation Programme Grant on 25 and 27 August 2010. National Treasury was also invited to participate in the hearings, and briefed the committee on the first quarter's spending of the conditional grant for the 2010-11 financial year.
The Mass Sport and Recreation Participation Programme Grant aims to promote mass participation within communities and schools through selected sport and recreation activities, and empower the communities and schools in conjunction with stakeholders through sport development. The Mass Sport and Recreation Participation Programme Grant comprises three programmes, namely the Siyadlala Community Mass Participation Programme; the School Mass Participation Programme; and the Legacy Programme. National Treasury reported that the total conditional grant allocation to provinces amounted to R426,4 million for the 2010-11 financial year. At the end of June 2010, R123,2 million was transferred to provinces, of which R70,2 million - which is 57% of the transferred funds - was spent in the first quarter of the 2010-11 financial year.
All provinces underspent on this grant in the first quarter except Limpopo province which overspent its budget allocation by R1 million. To restate, provinces that underspent are Gauteng, KwaZulu-Natal, North West, Western Cape, Free State, Northern Cape, Eastern Cape and Mpumalanga.
There are factors which contributed to the underexpenditure of the Mass Sport and Recreation Participation Programme Grant by the provinces. This included the implementation of the Fifa World Cup Programme that took precedence over the implementation of other programmes. Programme capacity issues at provincial departments was another contributory factor. The North West province was met with a challenge of litigation cases where contracted employees wanted to be permanent employees. There were also issues related to the business plans that were not submitted in time. Some sporting federations that were supposed to participate were not registered as business entities. Another factor was the issue of procurement.
The committee, therefore, noted that the grant framework requires that staff should be employed on a contractual basis. This led to some contract workers commencing with litigation actions against the provincial sport and recreation departments. As a result, the provincial departments cannot appoint new contract workers until judgment in respect of pending litigation cases has been passed.
It was brought to the attention of the committee that provincial departments purchased 2010 Fifa World Cup tickets. It is not clear whether this expenditure is in line with the approved business plans as required by the conditional grant framework.
The committee then made some recommendations. The North West province should approach the National Commissioner and the senior commissioner of the Commission on Conciliation, Mediation and Arbitration, CCMA, and report to them the slow process of finalising the litigation cases and its effect on service delivery. The Free State province should intensify its efforts to improve the roll-out of all activities that have been put on hold due to the 2010 Fifa World Cup activities.
The provincial treasury, in consultation with National Treasury and the Auditor-General, should investigate the appropriateness of the use of public funds by any provincial department in respect of the purchase of Fifa World Cup tickets. The findings should be reported to Parliament and the National Department of Co-operative Governance and Traditional Affairs within three months of the adoption of this report by the House.
National Treasury should conduct a thorough review of all business plans related to the Mass Sport and Recreation Participation Programme Grant and submit its findings to Parliament within three months of the adoption of this report by the House.
National Treasury and the provincial departments should provide detailed progress reports relating to the expenditure and service delivery progress, successes, challenges and any interventions regarding the mass sport conditional programme grant. The committee will intensify the oversight function on all grants to ensure that the funds allocated yield the required results in time.
Underspending undermines government's objectives for service delivery. As politicians we all know that any amount of underspending is actually a suspension of service delivery to our people and we have to make sure that all money that is allocated for activities needs to be spent at the right time so that services are received by our people. On behalf of the committee I request this Council to adopt this report. I thank you.
Debate concluded.
Question put: That the Report be adopted. IN FAVOUR: Eastern Cape, Free State, Gauteng, KwaZulu-Natal, Limpopo, Mpumalanga, Northern Cape, North West, Western Cape.
Report accordingly adopted in accordance with section 65 of the Constitution.