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On request, this circular will be made available in Afrikaans, isiZulu or Sepedi within 21 days

Also available on the GDE website at:

Office of the Head of Department

Room 1009, 111 Commissioner Street, Johannesburg, 2001

PO Box 7710, Johannesburg, 2000

Tel: (011) 355-1511 Fax: (011) 333-5546 E-mail: OR

English: Page1 of 4

THE ALLOCATION OF SUBSIDIES TO ELSEN SCHOOLS FOR THE 2006/2007 FINANCIAL YEAR

1.THE PURPOSE OF THIS CIRCULAR

The aim of thiscircular is to provide schools and their Governing Bodies (SGBs) with:

  • their allocation for the 2006/2007 financial year, and
  • the terms and conditions governing the transfer of funds to Section 21(1) public special schools.

2.THE FORMULA FOR SUBSIDY ALLOCATION

The formula for the funding of ELSEN schools was provided in Circular 51 of 2002. This formula takes into account the following:

  • A percentage of the total budget is set aside for top slice/redress.
  • A percentage of the budget remaining after the top slice has been deducted is then set aside for allocation to schools for the purchase of assistive devices.
  • The balance is then available for allocation to individual schools.
  • Firstly, those schools that have hostels receive R2100 per learner admitted to a hostel. The remainder is then allocated to schools in terms of its weighted enrolment. The weighting is based on the Weighting Norms set out in Appendix 1 of the “Regulations for the creation of educator posts in a Provincial Department of Education and the Distribution of such posts to the educational institutions of such departments” in terms of the “Employment of Educators Act, 1998 (Act No. 76 of 1998)”.
  1. THE ALLOCATION

The details of the allocation to your school are provided in AnnexureA.

School Governing Bodies (SGBs) are reminded that the allocations to their schools are based on the learner data (including hostel data) as contained in the 2006 10th School Day Snap Survey.

4.RESPONSIBILITY OF THE SCHOOL GOVERNING BODY

Section 36 of theSouth African Schools Act, 1996 (SASA) (Act No. 84 of 1996)imposes a responsibility on the governing body of a public school to take all reasonable measures within its means to supplement the resources supplied by the State in order to improve the quality of education provided by the school to all learners at the school. The school is not only entitled, but indeed obliged to endeavour to obtain further funds from the community in which it operates.

The governing body must prepare a budget each year, which shows the estimated income and expenditure of the school for the following financial year. Before the budget referred to is approved by the governing body, it must be presented to a general meeting of parents for consideration and approval by a majority of parents present and voting. This meeting must be convened on at least 30 days notice.

School fees may be determined and charged at a public special school only if a resolution to do so has been adopted by a majority of parents attending the meeting referred to above. The resolution must provide for the amount of fees to be charged, and equitable criteria and procedures for the total, partial or conditional exemption of parents who are unable to pay fees.

A governing body may not enter into any loan or overdraft agreement so as to supplement the school fund, without the written approval of the Member of Executive Council (MEC) for Education.

Note must be taken of Section 60(4) of the SASA. This indicates that the State is not liable for any damage or loss caused as a result of any act or omission in connection with any enterprise or business operated under the authority of a public school for the purposes of supplementing the resources of the school as contemplated in Section 36 of the SASA, including the offering of practical educational activities relating to that enterprise or business. It is important that schools take out insurance to cover any liability for damages awarded against the school. The payment of the insurance fee must be covered out of income derived from the commercial enterprise.

5.THE TERMS AND CONDITIONS GOVERNING THE TRANSFER OF FUNDS TO SECTION 21(1) PUBLIC SPECIAL SCHOOLS

In terms of the South African Schools Act, 1996 (Act No. 84 of 1996), Section 21(3), the Head of Department delegated the functions listed in Section 21(1). However, he was guided by the contents of the Public Finance and Management Act (PFMA) No.1 of 1999 Section 38(1)(j) that states that, as the accounting officer of the Gauteng Department of Education, he/she must obtain a written assurance from the entity that that entity implements effective, efficient and transparent financial management and internal control systems. If such written assurance is not or cannot be given, the entity renders the transfer of the funds subject to conditions and remedial measures requiring the entity to establish and implement effective, efficient and transparent financial management and internal control systems.

While the delegation of functions to public schools in Gauteng is underpinned by the terms and conditions of the SASA, the delegation of authority must be seen within the context of the PFMA and the Public Service Act. These Acts place mutual obligations on the Head of Department and school management (including SGBs) to exercise control over utilisation of State resources. Transfers to schools can only be efficiently utilised if they are used for the purpose for which they are intended.

‘Efficiently utilised’ means that the money is used for the purpose for which it was intended, at the right time, price and quality. By implication, for anything to be seen as efficient or not, it must be preceded by a plan which will act as a standard. This plan must address the issue of effectiveness in that it must be drawn with an intention to achieve the purpose for which the funds were transferred for.

The Public Finance Management Act also addresses the issue of transparency. This implies that the entity that will be receiving the funds must disclose to all stakeholders its plans, which show where the funds come from, what they were intended for, what they will be used for and when and how they will be used. It must also disclose when and how the funds were used, and who benefited from such utilisation.

Schools are expected to adhere to stringent financial management and reporting systems that are reliable, efficient and verifiable. Of particular importance, the GDE expects SGBs to commit to prudent administrative processes and to improved levels of performance at their schools.

6.ANNUAL FINANCIAL STATEMENTS OF PUBLIC SCHOOLS

Please be reminded that in compliance with Section 43(5) of the SASA, a copy of the audited financial statements for the period 1 January 2005 to 31 December 2005must be submitted to the Head of Department by 30 June 2006.

Failure to meet the above compliance requirement could result in subsequent transfer payments to the school being unnecessarily delayed.

In addition, for the purpose of ongoing monitoring in respect of financial management, schools are required to maintain monthly cash flow projections and actual expenditure statements.

I trust that the conditions attached to the transfer of funds to public special schools will assist us all in ensuring proper financial management and accountability. It should also contribute towards school effectiveness and improvement.

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MALLELE PETJE

HEAD OF DEPARTMENT

English: Page 1 of 4