INDUCTION PACK 1
NDPG Administration & Reporting
Understanding why & how NDPG is different
to other grants
• Concepts & terms → what do they mean?
– Funding Envelope
– Multi-year budgeting
– Schedule 6 & Schedule 7 of NDPG
• Funding components & importance of planning activities for
MPS
• Approval points
• Funding flows
• Financial operational management → the 5 rules
• Sequencing
• Municipal responsibilities
2
Budget Concepts: Funding Envelope
Project Funding Envelopes
Project 1
Project 2
Project 3
Project 4
Project 5
Project 6
Project 7
Project 8
Project …
+
+
+
+
+
+
+
CD &
PDs
NDPG Reference Group

+
=
Approved Portfolio
Funding Envelope

Approved Portfolio
Funding Envelope
+

Approved Portfolio
Funding Envelope
+

DDG
=
Approved
NDPG Funding
Envelope

100 projects @ R10 bn in 10 years
DG
3
Budget Concepts: Multi-Year Budget
• Funding Envelope ≠ annual gazette amounts!
• MTEF total forecasts vs. one-year detailed budgets
• Alignment of financial years → Treasury: 1 April &
Municipality: 1 July

Funding Envelope
Yr 1
Yr 2
Yr 3
Sch 7
Sch 6
Sch 7
Sch 6
Sch 7
Sch 6
Yr ++
Sch 6
4
Schedules 6 & 7
Status Quo, TRS
& Concept
Schedule 6
Direct Transfer
to Municipality
Schedule 7
In-kind to
Consultant
Business Plan
1 Programme Management & Coordination
Programme plans → MPS
2 Strategic Planning (SQ TRS, concept, etc.)
3 Detailed Design
4 Construction/Implementation Management
5 Construction/Implementation
6 Operating
1
Concept
2
Prefeasibility
3
Detailed
Investigation
4
Business
Case &
Business
Plan
5
Detailed
Project
Design &
Implementation
6
Exit
7
Review
5
Approval Points
• Status Quo, TRS & Project Concept
–
–
–
–
Project concept in respect of TRS
In alignment with NDPG
Interactive process with NDP
Authority to proceed
• Business Plan
–
–
–
–
–
–
Plan on how to implement
Plan on how to utilise capital grant as catalyst for TRS
Capital spending priorities identified
Rationale for choices made
NDP to approve
Then only can release capital
6
Schedules 6 & 7
No
Broad Category
Typical Outputs
1
Programme Management &
Coordination
Coordinated & managed programme, could also be dedicated
capacity for, and in, municipality (e.g. member of staff dedicated to
NDPG with short-term contract for programme & development
management), if needed. NDP would seek to limit exposure &
council should also contribute.
2
Strategic planning
TRS, business case development & high-level business planning,
feasibilities, detailed investigations, exit plans & M&E.
3
Detailed design
Detailed design work to build capital asset funded by the capital
as per Schedule 6 fund.
4
Construction management
Outsourced construction/project management for implementation
if needed.
5
Construction
Capital for construction.
6
Operating funding
Kick-start operating funding (BIDs, ops, etc.), if needed.
7
Operational Financial Matters
• NDPG → Hybrid grant
• Definitions of Schedule 6 & 7
• Importance of MPSs
Item
Schedule 6
Schedule 7
For
Construction
Planning mainly
Transfer
Direct transfer
In-kind transfer
From
National Treasury
PDF (PPP) via NDP
To
Municipality
Service Provider
What
For work to be done in next
quarter
Progress payments
Time
+1 week
+4 weeks
VAT
Excluded
Included
8
Funding Flows
Contractor
Municipality
Contract & appointment letter (Sch 7)
Service Provider
Invoices for Sch 7 amounts to municipality
Sch 7 Approved invoices from municipality
NDP Unit
Service Level Agreement
PDF
(PPP Unit)
9
Financial Management Rules
(1) Allocating & reallocating budgets for municipality
•
•
DoRA → Section 10
Allocations of Budgets
–
–
–
–
MTEF (3-yr) Forecast & Yr 1 in detail
Workings in September/October
Due for April of next year
Published in DoRBill in December/January of the next year → MTEF → NB for muni as
these are the numbers for municipal overall budget prep
– Also published in Government Gazette (DoRA) in April of next year
•
Reallocation of Budget
–
–
–
–
•
•
•
Adjusts only current year of expenditure → in-year adjustment
Workings in September
Due for October
Published in Government Gazette (DoRA Adjusment Gazette) in December
Government Gazette each time
Importance of programme plan & MPS → No info → we guess!
To assist in multi-year projects & provide certainty of cash-flow
10
Financial Management Rules
(2) Stopping – (3) Withholding
(2) Stopping
–
–
–
–
Process to take allocation back to Treasury if not used
DoRA → Section 26
Once a year → in March for NT financial year ending at end March
Funding Envelope generally not affected but can be if warranted
• Material & persistent non-compliance with DoRA
• Non-spending
• If not in alignment with NDPG framework
(3) Withholding
– Suspension of portion of funds if funds are not spent for 3 months in accordance with
MPS
– DoRA → Section 25
– Progress reviewed monthly but withholding generally done once a quarter
– Funding Envelope generally not affected → cash-flow management by Treasury
– Gazetted allocation not affected but Adjustment Gazette process takes lack of progress
on board & downwards adjustments are possible & likely
11
Financial Management Rules
(4) Roll-Overs – (5) Reporting
(4) Roll-overs
– Generally not supported
– However, any Schedule 6 transfers made in March are accounted for in current financial
year of Treasury but can still be spent by municipality in April-May-June (i.e. before end
financial year of municipality)
(5) Reporting
– Monthly reporting requirements in legislation
• MFMA → Section 71 & 72
• DoRA → Section 10
• NDPG grant framework
– Submissions by muni
– Progress reports on internet per award
•
•
•
•
•
•
One –pager
One per award
Pre-populated with data by NDP
10 minutes to do
Completion dates → 1st to 10th every month
Non-submission → Treasury can hold back payment requests of Schedule 6 & 7 amounts
12
Municipal Responsibility
• Committing to a longer-term township regeneration programme
• Implementing the NDPG catalytic component
• Management & coordination of entire development process
– Striving to improve Quality of Life
– Leveraging in public & private sector funds
• Managing processes
– Procurement of consultants & their management
•
•
•
•
MFMA, SCM, etc. applies
Ensure Value-For-Money
Get quality outputs
PSP Panel role
– Obtaining Council approvals
– Ensuring capacity is in place
• Budgeting & cash flow management & reporting
13
Next Step
•
•
Brief your management structures
Get your foundations in place
–
–
–
–
–
Sign Funding Agreement & Schedules
If no Council resolution, get one!
Sort out your delegations
Sort out capacity – even if short-term
Set up initial development coordination structure
• Political
• Administrative
•
•
Getting ready for 3 year funding commitments for forward predictability
Resources in your pack
–
–
–
–
Financial Policy & Procedures
Benchmark Costings (draft)
Schedule 3 of Funding Agreement: MPS
Guidance Note: VAT
14
Download

3.1_Induction Pack_1_Presentation_Apr10 - NDP