Purpose of RDP Fund

The RDP Fund is a central account (at the SA Reserve Bank) created as a conduit/mechanism for transferring donor funding to South African spending agencies, in accordance with specific agreements, referred to as technical assistance agreements.

A spending agency is a government or public entity in the national, provincial or local sphere of government. It does not include civil society or private entities. In the case of direct donor support to civil society or the private sector, funds are transferred directly from the donor to the intended recipient.

Funding Source

The primary funding source is the international donor community (foreign grants).
Other sources include domestic grants, funds appropriated by Parliament, interest accrued from RDP Funds invested, and proceeds from sale of state assets earmarked for RDP projects. These sources have become less relevant since the integration of the RDP.

Utilisation of funds

Funds paid into the RDP Fund have to be used in accordance with a technical assistance agreement, i.e. an agreement in terms of which a foreign donor grants official development assistance (ODA) to South Africa. Funds are earmarked prior to being paid into the RDP Fund.

The utilisation of unallocated funds, i.e. funds that have not been earmarked for a particular purpose, has to be in accordance with a Cabinet decision.


The Accountant-General is the accounting officer responsible for the administration of the RDP Fund.

The accounting officer of the relevant spending agency is accountable for the utilisation of donor funds transferred to that agency via the RDP Fund mechanism.

What happens to interest accrued

Subject to the relevant technical assistance agreement, funds that are not
Required for project implementation are invested with the Public Investment Commissioners (PlC).

Interest accrued has to be used in accordance with the relevant technical assistance agreement. Typically, interest has to be returned to the relevant donor, unless otherwise agreed. The same principle applies to unspent funds at the end of project implementation.

Extent of RDP funds underspending

total of R 4.246 billion has been paid into the RDP Fund, while transfer payments in the amount of R3.323 billion have been made. This leaves an unspend amount of R923 million in the RDP Fund , constituting a disbursement rate of 78.26 %

The reason for RDP Funding underspending are the following:
1 Unallocated payments, i.e. payments for which no project has been
specified, are sometimes made into the RDP Fund. Such payments have
to be verified prior to decision-making by Cabinet on their utilisation.
2 All payments made into the RDP Fund occur prior to transfer payments
being made to SA spending agencies, even in cases where a
reimbursement procedure is followed.
3 In many cases donors deposit funds into the RDP Fund prior to project
commencement or in trenches, particularly when there are disbursement
pressures on the donor in terms of its own budgetary rules and regulations.
In contrast to this, spending is spread over the life of the project.
4 Sound cash flow management - transfers to spending agencies are made
only when required.
5 Delays in project implementation.

Delay in transfer payment

Assuming that National Treasury is notified of the RDP Fund deposit, and that
a transfer payment requisition is submitted, the entire process from receipt of
in funds in the SARB account to the transfer payment into the account of the
relevant SA spending agency takes no more that a week.

Most delays are the result of payment being made without notification, which makes the tracking of funds quite difficult.