Division of Revenue Act, 2012 (Act No. 5 of 2012) > Chapter 3 : Conditional Allocations to Provinces and Municipalities > Part 3 : Matters relating to Schedule 4 to 8 allocations

Despite the provisions of the Public Finance Management Act or the Municipal Finance Management Act relating to roll-overs, any conditional allocation that is, in the case of a province, not spent at the end of a financial year or, in the case of a municipality, at the end of a municipal financial year, reverts to the National Revenue Fund, unless the relevant receiving officer can prove to the satisfaction of the National Treasury that the unspent allocation is committed to identifiable projects.

2)	The National Treasury, and a provincial treasury in the case of a provincially funded allocation, may, at the request of a transferring national officer, provincial treasury or municipality, approve-

a)	a roll-over from a conditional allocation to the next financial year; and

b)	spending of a portion of a conditional allocation on activities related to the purpose of that allocation, where the province or municipality projects significant unforeseeable and unavoidable over-spending on its budget.

a)	Any funds which must revert to the National Revenue Fund in terms of subsection (1), and which have not been approved by the National Treasury to be retained in terms of subsection (2), must be repaid to the National Revenue Fund.

b)	A receiving officer must ensure that all funds referred to in paragraph (a) are repaid to the National Revenue Fund.

4)	The National Treasury, in accordance with subsection (5), may offset any funds which must be repaid to the National Revenue Fund in terms of subsections (1) and (3), but which have not been repaid-

a)	in the case of a province, against future advances for conditional allocations to that province; and

b)	in the case of a municipality, against future advances for the equitable share or conditional allocations to that municipality.

5)	Prior to the National Treasury offsetting any amounts against allocations to a province or municipality in terms of subsection (4), the National Treasury must give the relevant transferring national officer, province or municipality-

a)	written notice of the intention to offset amounts against upcoming advances for allocations; and

b)	an opportunity, within 14 days of receipt of the notice referred to in paragraph (a), to-

i)	submit written representations and other documentary proof that the unspent allocation was either spent in accordance with the relevant framework, or is committed to identifiable projects;

ii)	propose alternative means acceptable to the National Treasury by which the unspent allocations can be repaid to the National Revenue Fund; and

iii)	propose an alternative payment schedule in terms of which the unspent allocations will be repaid to the National Revenue Fund.

6)	A notice contemplated in subsection (5) must include the intended amount to be offset against allocations, and the reasons for offsetting the amounts.

7)	The retention of funds which should revert to the National Revenue Fund in terms of subsections (1) and (3), and which have not been approved by the National Treasury to be retained in terms of subsection (2), constitutes financial misconduct by the receiving officer in terms of section 34.

Division of Revenue Act, 2012 (Act No. 5 of 2012)