CoE tables a R57.6b budget

The City of Ekurhuleni 2023/2024 consolidated expenditure budget of R57.6b was tabled before council by MMC for Finance Nkululeko Dunga last week.

The proposed revenue of the budget is R55.3b consisting of:
• R22b from the sale of electricity.
• R8.6b from property rates.
• R6.7b from water revenue.
• R3.2b from sanitation revenue.
• R1.8b from refuse revenue.
• R1.3b from interest earned on outstanding debts.
• Almost R5b from interest earned on investments, rental of facilities and equipment, licenses and permits.

CoE also receives R6.2b from other revenue sources such as the national and provincial governments in the form of equitable share and conditional grants.

Electricity
Dunga told council it is essential to prioritise the electricity crisis in the budget.
“National government declared through the 2023 budget speech and through the Eskom rescue bill that it has no intention to generate additional electricity. Ekurhuleni depends on Eskom for electricity. We will work with the administration to do everything in our power to bring about electricity stability.

“Ekurhuleni intends to issue a Request for Information to potential investors who are willing to enter into public/private partnerships and who are willing to enter into Build-Operate-Transfer (BOT) contracts to build additional electricity generation capacity for Ekurhuleni,” said Dunga.

“If there is dependable electricity that can come from Mozambique, Namibia, Zambia, or any of our neighbouring countries, we will work through the Southern Africa Power Pool process to source electricity. We demand that the national treasury and relevant departments and ministries establish a conditional grant to assist municipalities with hybrid and off-grid solutions.

“We also will collaborate with the provincial and national governments to utilise the special economic zones in Ekurhuleni to attract industrial manufacturers for solar panels, inverters, batteries and all electronic equipment that are essential for hybrid and off-grid solutions.”

Revenue
“The budget that we are allocating and tabling in council for approval, of which R54.9b is for operating expenditure and R2.7b for capital expenditure, is not enough to respond to our needs.”
“Revenue enhancement constitutes the core of what we should all pursue and thus these key components will be instituted.”

Revenue will be collected through the following avenues:
• Maximum collection of rates and taxes from those who should and can pay for rates and taxes. Operation Siyacima Manje–Namhlanje will be directed at companies, SOEs and government departments that owe the city millions.
• Maximise revenue collection from the real estate and city planning departments through outdoor advertisements and masts payments by telecommunications companies that are using CoE buildings for network connectivity.
• Source and optimally use conditional grants that the municipality is eligible for by focusing on the Social Housing Regulatory Authority Grant, which is a dedicated grant for social housing purposes.

“Due to the rising levels of unemployment and poverty among our people, the number of indigents in the City of Ekurhuleni is higher than the number that is estimated by the National Treasury. We will demonstrate to the National Treasury that the population size of Ekurhuleni, particularly of the indigent population, is higher than their estimations, and this will be a sound basis to increase the municipality’s equitable share.”

• Insourcing of essential services as a mechanism of revenue enhancement.
• Corporatisation of Springs Fresh Produce Market.

“Corporatisation of this market is not the same as privatisation; it is a mechanism that seeks to increase the agility and flexibility of the market in a manner that would not be possible under the current regulatory and legislative framework.

“This revenue enhancement mechanism demands that we as the City of Ekurhuleni allocate the land at our disposal to farmers who will produce food with a full guarantee that there will be offtake of the food products, this will create sustainable jobs for our people.”
• Enhanced traffic fines collection.

Infrastructure
“Upon assuming office, we discovered that the city had spent only R29.8m of the R94.8m allocated for infrastructure, leading to a reprioritisation of R65m away from infrastructure. We will embark on an infrastructure rehabilitation project,” said Dunga.
The projects will include a dedicated pothole repair team, a regular road maintenance schedule and R256m to be allocated to prioritise roads and stormwater construction. Part of this money will be used to rehabilitate roads and clean stormwater drainage.

Municipal service buildings and neglected council properties will be inspected and addressed via a preventive maintenance plan.

“We will engage local construction and maintenance companies and also explore options to build internal capacity, reducing our dependence on third-party service providers. Our commitment to this is reflected in the R4.4m for health and social development, R22.3m for SRAC and R68.7m for the real estate department for repairs and maintenance.

“Specifically, we will ensure that where necessary we renovate some of the properties in Wadeville, Boksburg and Bedfordview to provide decent quality affordable rentals for working class, skilled and professionals respectively. To speed up this process to ensure occupation in early 2024, the private sector will be invited to submit RFPs.”

Dunga said in collaboration with law enforcement agencies, CoE will reclaim hijacked buildings. Once reclaimed, these buildings will undergo thorough inspections and necessary renovations to ensure their safety and habitability. These buildings will then be rented to eligible tenants.

CoE also expanded on its rollout of high mast lights, particularly in informal settlements and townships that are not connected to the national grid. This will extend to traffic lights.

“We have since intervened to ensure that contractors are paid on time, even if it means we allow invoicing twice a month. This will address spending in the next two months, but for the purpose of the budget we are tabling today, we are confident that all the budget allocated for infrastructure will be spent and will be spent on time.”

Sanitation
“We must expedite the process of removing chemical toilets from our communities, replacing them with dignified and hygienic sanitation solutions.
“We recognise that proper sanitation is not a luxury, but a fundamental human right. As such, we are looking at investing in the construction of decent toilets as we engage in the informal settlement re-blocking programme.”

Environment and waste
Dunga acknowledged that Ekurhuleni’s CBDs are littered with rubbish as CoE has failed to collect waste regularly.

“Parks and cemeteries remain unkempt. People in Kempton Park, Germiston, Benoni, Thembisa, Duduza, Katlehong and Tsakani are particularly affected. The cleaning of our environment must start with the municipality, and our people will be encouraged and will be empowered to look after their environment,” said Dunga.

CoE allocated R2.8b for environment and waste management of which R54m will be used to purchase waste collection trucks.
“We have already purchased 12 trucks, of which two were delivered at the beginning of the month. Two will be delivered next week and eight will be delivered in July.”

CoE allocated R77.6m to clean and beautify all entrances of townships and informal settlements and cutting of grass in open fields.
To address illegal dumping, the CoE allocated R47m to ensure that waste disposal and landfill sites are operational and clean.

Health and Social Development
CoE allocated R1.371b in terms of employee-related costs to ensure that the city has sufficiently trained staff at primary healthcare facilities.
“We have further allocated R4m in capital expenditure, for the purchase of specialised and medical equipment as well as tools of trade.”

Sport, recreation, arts and culture
“We are going to revive major events such as jazz and music festivals, and sporting tournaments.
“We have allocated R2m as part of this initiative, on top of the R25m that we have allocated for tourism offerings.”

Tariffs
“Except for the water and electricity increases that are determined by Rand Water and National Energy Regulator of South Africa (NERSA), we are proposing a 5.3% tariff increase for key municipal services,” said Dunga.

Around 66% of the budget revenue of R55.3bn is projected to come from electricity, water, sanitation and refuse collection charges. “We propose repairs and maintenance of R1b for electricity, R364m for water and sanitation, R148m for ERWAT and R105m for environmental and waste management.

“We intend to fund the operating expenditure with R49b from the provision of basic municipal services, and the remaining R6.3b will be funded by equitable share allocation and grants. We are budgeting for an operating surplus of R401m.
“We intend to fund the capital budget of R2.7b from the provision of basic municipal services of R355.6m and R2.3b through grants,” said Dunga.

Social relief package
“We have already reviewed the qualifying criteria from R250 000 to R500 000 of property value to be deemed indigent and this will add an additional 220 000 households to the indigent database.”

The package for this financial year includes 50% rebates on assessment rates, free refuse removal, 50kwh of free electricity per month, 6kl of water and sewer per month, free indigent burial to registered and deemed indigents, and special rates on emergency services such as ambulance and fire-fighting.

The total cost of this social package is R5.1b, which is an increase of R200m from the previous financial year.

Non-payment of service providers
The NEWS recently reported that numerous business owners met with CoE recently to raise grievances for non-payment of services rendered to the municipality.
“Non-payment can undermine the integrity of the city’s finances and our economy. We have processed a number of unpaid invoices.”

Also Read: Watch: 2023 National Budget Speech

Also Read: CoE budget: Relief for poor, money for potholes, security and housing