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Cities

City of Tshwane's Budget Speech 2011

Budget speech for the City of Tshwane, delivered by the Executive Mayor, Councillor Kgosientso Ramokgopa, Sammy Marks Council Chamber, 28 April 2011

THE Honourable Speaker, Father Smangaliso Mkhatshwa
Chief Whip of Council, Councillor Terrence Mashego
Members of the Mayoral Committee
Leaders of the Opposition
Leaders of All Political Parties
Honourable Councillors
Traditional Leaders
Executive Mayors, Councillors of Metsweding and Kungwini
Administrator from Nokeng tsa Taemane
Acting City Manager and Officials
Officials from Metsweding and Kungwini
Honourable Guests
Members of the Media
Ladies and Gentlemen

Mr Speaker, we take pleasure in presenting this budget speech and the Medium-Term Revenue and Expenditure Framework (MTREF) for the 2011/12, 2012/13, and 2013/14 financial years. There have been exciting developments that have had a bearing on how this budget has been developed.

Towards the end of last year, Statistics South Africa informed us that the country was formally out of the global recession. This means that the economy of the country is rallying and that we are therefore on our way back to financial stability.

The further good news was the positive impact of the financial turnaround engineered by the city which resulted in favourable Moody’s credit rating from negative to stable.

To be more specific, Moody’s places us at Aa3 (stable), which is defined as high-grade. Aa ratings are judged to be high quality, with a very low credit risk. This means that the City of Tshwane will be able to provide better services because we can obtain credit at competitive rates in the open market.

The second exciting development is that we put our books in order in the past financial year. As a result, the Auditor General expressed an opinion on the City’s finances, handing down an unqualified audit. The opinion suggests that our finances are improving, and so is the management thereof. We are now moving towards a clean audit; hence, we have put together a Special Mayoral Working Committee, chaired by the Executive Mayor tasked with ensuring that we achieve a clean audit for the current financial year .

Apart from the Mayoral Working Committee, we have strengthened other mechanisms that will propel us towards a clean audit. We have enhanced the capacity of the Office of the Chief Audit Executive and established a dedicated Risk Management Office, as well as a Contract Management Unit in the Office of the City Manager.

The third exciting development is that the City of Tshwane will, immediately after the forthcoming local government, expand its borders by incorporating Metsweding District Municipality.

As we all know, this is part of the proposed amendments of borders by the Gauteng Provincial Government, which will lead to the disestablishment of the Metsweding District Municipality. The City of Tshwane will become the successor-in-law of all the Metsweding resources, assets, liabilities, rights, obligations and titles, and all the administrative and other records. In terms of the border amendments, the 2010/11 budget of Metsweding municipality remains in force until 30 June 2011.

When the Metsweding District Municipality, with its local municipalities Nokeng tsa Taemane and Kungwini become part of the City of Tshwane, the new City of Tshwane becomes the largest metropolitan municipality in South Africa, comprising of an area of 6 368 km² and a population of just over 2,5 million.

Furthermore, it is worth noting that the new City of Tshwane will become the third largest city in the world in terms of land mass, after New York and Tokyo/Yokohama respectively .The reconfigured Tshwane will move from the current five regions and 76 wards, to seven regions and 105 wards. Accordingly, the budget that we are presenting today is for the entire area of the new City of Tshwane.

The incorporation will also provide the City with new opportunities to diversify its revenue base. The new areas will bring in valuable resources such as vast tracts of vacant, undeveloped land, agricultural or farming communities, mining enterprises, eco-tourism, forestry and fishing.

The fourth development is that the budget is presented just before the local government elections. This means that the MTREF to a large extent outlines the priorities of the coming political term. Moreover, we present this budget at the end of the ten years of service delivery by this City. The MTREF therefore sets the tone for the next decade of service delivery.

Mr Speaker, against all these interlinked background factors the theme of our budget speech today looks to the future: Consolidating service delivery, accelerating job creation and strengthening foundations for a new Tshwane, a City of Excellence.

The Medium-term Revenue and Expenditure Framework

The total revenue budget over the medium term is R66,3 billion, constituted by R19,06 billion for 2011/12, R22,16 billion for 2012/13 and R24,9 billion for 2013/14. The total revenue increased by 16,3% against the 2010/11 adjustment budget and by 18,9% against the 2010/11 approved budget.

The operating expenditure for the medium-term equates to R60, 6 billion. This will be a tool to consolidate service delivery and accelerate job creation. Total expenditure has increased by 18, 1% against the 2010/11 adjustment budget and by 20,5% against the 2010/11 approved budget.

Our operational budget has increased. This is how this portion of the 2011/12 budget has been allocated, per department.

​Department ​Budget 2011/12 ​ % of budget
​Agriculture and Environmental Management ​R 1 659 745 000 ​9,28%
​City Planning ​R 197 154 000 ​1,10%
​Community Safety ​R 1 088 761 000 ​6,09%
​Corporate and Shared Services ​R 1 221 890 000 ​6,83%
​Economic Development ​R 70 201 000 ​0,39%
​Emergency Services ​R 378 720 000 ​2,12%
​Financial Services ​R 808 950 000 ​4,52%
​General and Assessment Rates ​R 732 885 000 ​4,10%
​Health and Social Development ​R 310 983 000 ​1,74%
​Housing and Sustainable Human Settlement Development ​R 410 938 000 ​2,30%
​Public Works and Infrastructure Development ​R 8 922 707 000 ​49,91%
​Transport and Roads ​R 1 328 989 000 ​7,43%
​Sport, Recreation, Arts and Culture ​R 240 687 000 ​ 1,35%
Total operating budget R 17 879 128 000 ​ 100,00%

Our capital budget has increased to R 3.185 billion. We will come back to how these funds will be spread per department

Significant increases in revenue and expenditure

The budget points to significant increases in revenue and expenditure. These can be attributed to four service delivery imperatives.

The first is the new development that will positively affect the Human Settlement and Housing department. The department will assist the City to realise an increase in revenue due to the introduction of a new grant called the Urban Settlement Development Grant (USDG). The USDG is aimed at supporting the development of sustainable human settlements through accelerating the provision of serviced land with secure tenure for low-income households in large urban areas.

The grant will inject the following amounts into our coffers: R891 million for 2011/12; R1 053 million for 2012/13; and R1 155 million for 2013/14. The funds will be expended on capital projects, and therefore form part of the capital budget.

Mr Speaker, the formalisation of informal settlements is a critical priority. Out of the 65 informal settlements in the current City of Tshwane, 33 have already been formalised. There are 32 remaining settlements, and this number will increase after the merger as we will gain additional informal settlements from the Metsweding side. R1,5 billion has been allocated over the three financial years for the formalisation programme.

The second factor will be a revenue stream through the Transport and Roads department, which will earn the City the Public Transport Infrastructure and System Grant (PTIS). Again, the expenditure will lie in the capital budget.

The PTIS grant will be allocated in the following manner: R180 million to the 2011/12 financial year, R780 million to the 2012/13 financial year, and R828,75 million for the 2013/14 financial year. The Bus Rapid Transit (BRT) system will benefit from these allocations. This means that our transport system will be improved, and our people will be able to travel to work under improved conditions.

The third factor will be increased expenditure for the Agriculture and Environment Management department. The department’s expenditure will increase due to the phasing in of salaries associated with the absorption of labour-broker employees, leasing of vehicles, upgrading and maintenance of parks, cemeteries and traffic islands. Another R3,5 million will be expended as we enhance the operationalisation of the food bank.

The fourth factor will be the increase in expenditure for the Community Safety department. The increases will be due to the purchase of new uniforms, vehicle costs, training ammunition and equipment for the appointment of 350 new Metro Police officers.

Tariffs

Mr Speaker, one of the major talking points that have attracted public attention since we presented the draft budget to this Council has been the issue of tariffs. Some have chosen to concentrate on one side of the argument, while deliberately choosing to ignore the whole picture, namely a tariff regime.

Our approach to the tariff regime is a bold one; one that might not be popular with certain sections of our city, but which, when everything logical and rational is considered, is necessary and unavoidable. So, what are the facts?

The expanded City of Tshwane is faced with the challenge of three different tariff structures for property rates, electricity, refuse removal, water and sanitation.

To ensure the financial sustainability of the municipality and greater compliance with the Municipal Property Rates Act of 2004, a single tariff has been recommended for the new City of Tshwane.

The budget we table today incorporates the proposed unified property rates. I want to emphasise that the proposed rates have been calculated in terms of the law, that is, the Regulation that points to the actual formula.

Furthermore, we regard a single tariff structure as essential. It is our considered view that we are creating One City, and One System. If we fail to do that, it may lead to a fractured system and almost the same experience that we had in 2000 when the current City of Tshwane was founded. We can be expedient and populist. Or we can do the right thing, do our business in terms of the law, and therefore build one city, with one system. We choose the latter.

The populism that we are referring to is in fact not only illegal; it will be false and dangerous in the long term. Some argue that the residents of the current Kungwini and Nokeng tsa Taemane will lose out because of a single property rate. Nothing could be further from the truth.

A simple reading of the proposed rates indicates that the overwhelming majority of households in both areas will gain immensely from the property rates. Only in a few instances will there be real increases, owing to the fact that there has not been a proper property rates system in the said areas.

A number of factors have been taken into account when calculating the property rates for the MTREF. The principal factor that had to be taken into account is the Municipal Cost Index, which calculates the inputs and raw material costs relevant to municipalities. It must also be considered when tariff increases are calculated. The current Index stands at 15,9%.

In addition the Eskom price of bulk electricity supplied to municipalities will increase by 26,7% on 1 July 2011. A guideline tariff increase of 20,38% was indicated by the National Energy Regulator of South Africa (NERSA). However, the City of Tshwane has decided on an increase of 19,8% for residential households. This means that we have created a cushion for our residents by bringing down the tariff by 0,58%.

Then, Rand Water has announced a tariff increase of 12.9% for bulk purchase. This will contribute approximately 50% of the City’s input cost. In line with National Treasury regulations, water tariffs must reflect costs. The City must also, again in line with the National Treasury’s Circular 54, ensure that water services are not only cost-effective; they must also be safe.

The City has accordingly decided to increase the water tariffs by 9%, which is 3,9% less than the Rand Water tariff increase. Thus residents will save. On the other hand, sanitation costs will increase by 8% to maintain the high standards of our water quality. The City has been accredited with the Blue Drop and Green Drop national status for good quality potable water and waste water respectively.

As already stated, property rates will increase by 8%; in terms of the legislation. It should be noted that households in both Kungwini and Nokeng tsa Taemane will, as from 1 July 2011, enjoy a rebate of R50 000. It entails R15 000 impermissible value plus a further R35 000 granted by the current City of Tshwane.

In addition, there will be a 35% rebate on property tax, currently granted by the City and Nokeng tsa Taemane, with 30% currently granted by Kungwini. It is our considered view that the owners of lower-value properties will benefit from the new tariff regime. Furthermore, registered indigents will not be liable for property rate charges.

With regards to waste removal, it must be stated that the City will for the medium-term render the services at a deficit of R341 million for the 2011/12 financial year, R343,1 million for 2012/13, and R300,9 million for 2013/14. The City has therefore embarked on a solid waste strategy to ensure that this service can be rendered in a sustainable manner over the medium to long term.

The waste strategy commenced during the 2009/10 financial year. However, during the 2010/11 financial year it had to be held back to allow citizens to recover from the economic recession. It is now imperative to continue with the strategy, especially when we consider the cost of absorbing labour brokers. Waste removal will therefore increase by 17%.

The truth must be told that the rich will unfortunately continue to subsidise the poor as far as this issue is concerned. We have calculated the averages based on property value and category as outlined in Municipal Property Rates Act. Therefore the poorer sections of communities in previously disadvantaged areas in both Nokeng tsa Taemane and Kungwini will receive the same benefits as those in the current City of Tshwane. The indigent households in Kungwini and Nokeng tsa Taemane will not pay for services, just as those in the current City of Tshwane do not.

On average, and taking into account all the above factors, the average increase in total municipal account in Kungwini will be 1.2%. In Nokeng-tsa-Taemane average increase in total municipal account will be 17.8%, while in the current Tshwane the average increase in total municipal account will be 13.08.

Capital projects per region

Mr Speaker, the City continues to improve efficiencies with regards to how we do business. A shining example is our Integrated Development Programme (IDP).

Even though the IDP process was led by technical experts within the administration, with the political leadership providing guidance and stewardship, our people remained central, providing actual input into the process. This is in line with the central approach of National Government’s commitment to being a people-centred government.

An extensive IDP consultation process was undertaken to determine community needs. The projects funded in the IDP were considered in terms of priorities as well as the principle of funding contractual obligations and new projects that have arisen.

The capital budget for the 2011/12 financial year is R3,185 billion. This is an increase of 8,06% for the 2011/12 financial year when compared to the approved budget of R2,9 billion for the previous financial year. The total capital budget for the medium-term will be R11,19 billion.

Mr Speaker, to address the needs of our communities effectively we have divided the capital budget in terms of regions. We have done so by allocating the funds to different departments which undertake capital projects. The departments will in turn spend the funds in the seven regions.

Allocations to departments reflect our promise to the residents contained in the maiden speech we delivered in November last year, and the recent State of the City Address. In addition, the allocations reflect the will of the residents and other stakeholders as articulated and recorded during the IDP public consultation processes.

The Public Works and Infrastructure Development department will take up 42,17% of the capital budget. In rand terms this translates into R1,3 billion. The funds will be used to expand the electrification of areas that are in need of electricity. We will continue repairing street lights. Our efforts in this regard are indeed being noted.

In a recent assessment by the social media group, Mobilitate, it was noted that the City’s Electricity division has greatly improved its response rate to reports of street lights that are out of order. Allow me to quote extensively from Mobilitate’s article, which was published on April 20:

This week Mobilitate salutes City of Tshwane’s Public Lighting Services (PLS) for the quick and efficient way in which they deal with the endless faulty streetlights we report to them.

PLS forms part of the City’s Energy and Electricity Department.

Despite numerous challenges most municipal call centres face, PLS always provide Mobilitate with a reference number and feedback after receiving the complaint.

Since Mobilitate went live, 407 streetlight issues have been reported to the PLS, of which 371 have been resolved.

This is the kind of service we promise our people. We are resolved that in this particular case the remaining 36 streetlights must be repaired. We will continue to provide this kind of speedy service so that our people may enjoy living in the City.

Mr Speaker, the department will not only have to work hard; it must also work smart. To this end we have allocated R50 million for the 2011/12 financial year, R100 million for 2012/13 and R40 million for 2013/14 respectively for the rolling out of the automated meter reading or AMR system over the medium term. This we will do in part owing to the legislative requirement that all customers consuming 1000 kilowatts per month will have to apply for the AMR system by 2012.

The project will involve the full deployment of smart meters to large-scale power users, the establishment of a communications infrastructure, and end-to-end integration into our current operating system.

A phased approach will be adopted, with 1 020 pilot meters being installed during the 2011/12 financial year, 14 160 during the 2012/13 financial year, and the final 4 000 during the 2013/14 financial year.

Apart from satisfying the requirements of the legislation it is our hope and intention that the AMR rollout will contribute to improving our billing system. The system is generally performing well, except for few worrying instances which receive our attention on a daily basis.

The Transport and Roads department will be allocated 24,85% of the capital budget. This will translate into R791 million. These funds will be used to improve the quality of our roads through upgrading and rehabilitation, and our storm water drainage system, especially in the townships, where ageing infrastructure has come under strain due to increased loads on our roads.

We should also be able to cope with the continuing problems caused by heavy rains; by repairing all the potholes in the City. Many will agree that great strides have been made to repair potholes in most of the roads.

The Human Settlement and Housing department will be allocated 18,11% of the capital budget. This will, in rand terms, translate into R576 million. A portion of these funds, R55 million to be exact, will be used to start the overdue upgrading of the Schubart Park and Kruger Park blocks of flats.

We are resolved to address the problems besetting these flats, so that our people can live in suitable conditions. Also critical will be the upgrading of hostels to make them suitable for human habitation and, in some cases, turn them into family units.

The Agriculture and Environment Management department will be allocated 2,89% of the capital budget. This will translate into R92 million. The department is tasked with the difficult role of keeping our City clean.

Mr Speaker, the City understands that waste management is inherently risky. Failure on our side to collect waste on time and properly can always lead to outbreaks of disease. Fortunately we have not experienced this so far. To prevent such outbreaks, we have put in measures to contain wildcat strikes that have the potential to lead to a breakdown of our waste management system. As said earlier, we have started with a phased approach to absorb labour-broker employed workers.

Apart from the challenge of having to phase in labourers who previously worked or continue to work for us through labour brokers, the department needs modern vehicles to cope with waste collection in a growing city.

The department must also ensure that our promise of grass-cutting is honoured. Apart from the obvious aesthetic and conservation management imperatives of mowing grass in open spaces, it also plays a role in crime prevention, by reducing hide-outs for criminals.

The Corporate and Shared Services department will receive R174 million for capital expenditure. The department undertakes two important functions that assist the municipality to fulfil its mandate. The first is the maintenance of municipal buildings across the City. It is important that the institution and its functionaries operate in buildings that maximise productivity.

The second major function of the department which relates to capital expenditure, is the municipality’s information technology (IT) systems. In order for us to function maximally we will have to continue adopting and using new technologies that enhance our productivity.

The incorporation of the Metsweding District Municipal offices will require upgrading our systems and expanding the fibre-optic cable network so that we are able to operate an integrated system.

The Community Safety department must be one of the departments with the most difficult tasks to fulfil – enforcing by-laws, supporting the SAPS with crime prevention, and enforcing the road traffic laws.

The department will receive R16 million. The funds will be used to acquire more vehicles for our officers, ammunition and other equipment to enable the Metro Police to fulfil its tough mandate. We are also going to assign officers to wards, in what we call the Ward-based Deployment Strategy.

The Emergency Services department, which comprises of the Fire Brigade Services, the Emergency Medical Services, and the Disaster Management Centre, will receive R17,5 million for capital allocations for the 2011/12. These funds will be used to purchase vehicles and other equipment for emergency services.

Through this investment we will be able to respond more quickly to incidents where our people may need our assistance. These entail fire breakouts, road accidents, search and rescue operations, and natural disasters. We will maintain the high standards of responding to 100% of incidents to which we are called out.

Mr Speaker, let me now provide detailed allocations for all seven regions, and thereafter outline specific projects which will be undertaken in these regions.

​Region ​Budget 2011/12 ​% of capital budget
​Region 1- North West ​R 691 325 390 ​21,70
​Region 2 – North East ​R 812 716 555 ​25,51
​Region 3 – Central Region ​R 253 469 180 ​7,96
​Region 4 – Southern Region ​R 605 308 158 ​19,00
​Region 5 – Nokeng Tsa Taemane ​R78 636 350 ​2,47
​Region 6 – Eastern Region ​R160 250 000 ​5,03
​Region 7 – Kungwini ​R86 981 928 ​2,73
​Tshwane-wide ​ R496 730 179 ​ 15,59
Sub-total ​R3 185 417 740 100

The Tshwane-wide projects are those initiatives that will affect all the wards in the City, including the newly established Nokeng and Kungwini regions.

With the Tshwane-wide projects the two new regions will realise a benefit of R375 million, which will be 10% of the capital budget, inclusive of their ward-specific project for capital allocations.

Let us now turn to the specific projects in each region. What is common and running through all the projects is our endeavour to contribute to job creation. Also critical and central to these allocations is a demonstration of our resolve to improve service delivery for all our people.

Region 1: North West Region

The main projects in the North West Region relate mainly to:

  • The electrification of Winterveldt, with a budget of R13 million in the 2011/12 financial year. The rollout of new bulk electricity infrastructure is a priority as well.
  • The region will receive R12 910 048 for the construction of the Call Centre in the North. This project will have three major benefits for the City. First, it will propel developments in the impoverished part of the City. Second, the project will assist the City to compete with other cities in this growing market. Failure on our side to position ourselves in this important meeting will only lead to the growing migration of important services to other markets like India. Third, the project will lead to job creation, especially for young people.
  • The Mabopane Station Intermodal Interchange, which entails the upgrading of the public transport facilities, including the local taxi rank and bus facilities as well as the informal trading stalls (hawker facilities). This project has been allocated a budget of R7,4 million over the medium term. The project will benefit the community through the employment of the local labour force as well the community liaison officers via the ward councillor. It is our hope and intention that the upgrading of this infrastructure will attract investments thereby enhance economic sustainability.
  • The Mabopane Library (ODI) will be finalised in the current financial year. R6 million has been budgeted for the project
  • Upgrading of roads is also a priority in the region. An amount of R353,8 million has been budgeted for internal roads, as well as upgrading of roads in Mabopane.

Region 2: North East Region

The main projects in the North East Region relate mainly to:

  • Sewer house connections which will be undertaken in Steve Bikoville. A budget of R10,5 million has been prioritised for this project.
  • R23,2 million has been allocated for the installation of high mast and street lights in Steve Bikoville, Ward 73.
  • The Suurman library has been allocated R15 million over the next two years.
  • The Hammanskraal Multi-Purpose Sport and Recreation Centre has been allocated R25 million over the next three years.
  • Flooding backlogs have been allocated R187 million over the medium term to for the Eersterust, Stinkwater, Kudube, Matenteng, Mandelaville, and Ramotse areas.
  • The upgrading of Lavender Road has been allocated R18 million for the next financial year.
  • A new clinic in Doornpoort will be constructed and an allocation of R31 million over the medium term has been made.

Region 3: Central Region

The main projects in the Central Region relate mainly to:

  • Upgrading the Schubart Park and Kruger Park flats. As already indicated, this will be one of the major priorities during the forthcoming financial year. R15 million has been allocated for Kruger Park, while R40 million has been allocated for the upgrading of Schubart Park.
  • The redevelopment of the Saulsville hostel has been allocated R58 million over the medium term.
  • The Saulsville Station has been allocated R6,7 million over the next three years.
  • The extension of the Danville Clinic has been allocated R13 million over the next two years.
  • R10 million has been allocated for the construction of the Lotus Gardens Multi-Purpose Centre.
  • Upgrading of Maunde Street in Atteridgeville has been allocated R26,1 million in the 2011/12 financial year.

Region 4: Southern Region

The main projects in the Southern Region relate mainly to:

  • R21 million allocated to the Olivenhoutbosch Multi-Purpose Sport Centre.
  • Efforts to rehabilitate the Centurion Lake will be boosted with a R5 million allocation.
  • R127 million has been budgeted for the upgrading of the Sunderland Ridge Waste Water Treatment Plant.
  • The extension of the Olivenhoutbosch Clinic has been allocated R25 million over the next 3 years.
  • R4 million has been allocated for the secondary network upgrade project in Laudium.

Region 5: Nokeng Tsa Taemane

The main projects in this Region relate mainly to:

  • The redevelopment of hostels in Wards 38 and 67. R58 million has been allocated over the medium-term period.
  • The East Lynne taxi facilities have been allocated just over R10 million over the next three years.
  • Flooding backlogs have been allocated R5 million in Ward 75 (Kudube Unit 11)
  • The bulk water supply in Franspoort has been allocated R15,8 million (Ward 99). The rollout of bins will also take place, consisting of bulk containers, 240 litre swivel bins as well as 1000 litre containers

Region 6: Eastern Region

The main projects in this Region relate mainly to:

  • R3 million has been allocated for the marketing and trading stalls in Mamelodi. This will assist the community in terms of economic development.
  • The upgrading of sewers in Mamelodi has been allocated R2,5 million.
  • The Stanza Bopape Library will be completed. R6 million has been allocated for the 2011/12 financial year to finalise the work.
  • R32,9 million has been budgeted for the major storm water systems in Mamelodi over the medium term.
  • The doubling of Simon Vermooten Road has been allocated an amount of R195 million over the next three years.
  • R58 million has been budgeted for flooding backlogs in Mamelodi, Eersterust and Pretoria East over the medium term.
  • The upgrading of Sibande Street in Mamelodi has been allocated R50,3 million over the next three years.

Region 7: Kungwini

The main projects in this Region relate mainly to:

  • The Ekangala Waste Water Treatment Works project has been allocated an amount of R38 million over the next three years.
  • Rehabilitation of roads in Bronkhorstspruit has been budgeted R4,9 million for the 2011/12 financial year in order to finalise the contract that is in place.
  • The upgrading of roads in Zithobeni Wards 5 and 6 has been allocated R17,8 million over the next three years.
  • The upgrading of roads in Ekangala has been allocated R49,8 million, covering Wards 8 to 12.
  • Water supply to agricultural holdings has been allocated R8 million over the medium term.

Mr Speaker, we have shown how the capital budget has been allocated in terms of the departments, and in terms of regions. One of the guiding principles according to which we function is through the fulfilment of the seven strategic objectives which we have adopted, which guide our IDP.

It is against these strategic objectives that we are able to measure how far and how fast we are travelling in addressing the needs of our people. Let me now turn to the capital budget allocations per strategic objective

​Strategic Objective ​Budget 2011/12 % ​ ​ Budget 2012/13 ​ % ​Budget 2013/14 % ​
​Provide basic services, roads and storm water ​R2 810 630 068 ​88,23% ​3 561 029 950 ​89,58% ​3 666 759 976 ​90,56%
​Economic growth, development and job creation ​R35 700 000 ​1,12% ​24 300 000 0,61% ​12 075 000 ​0,30%
​Sustainable communities within a clean, healthy and safe environment and integrated social services ​R125 450 000 ​3,94% ​211 700 000 ​5,33% ​185 900 000 ​4,59%
​Foster participatory democracy and Batho Pele ​R16 356 390 ​ 0,51% ​3 553 658 ​0,09% 1000 000 0,02%
​Promote sound governance R160 308 000 ​ 5,03% ​142 155 000 ​3,58% 158 000 000 ​3,90%
​Ensure financial sustainability ​R25 750 000 ​ 0,81% ​28 760 000 ​0,72% ​22 700 000 ​0,56%
​Organisational development and transformation ​R11 223 287 ​ 0,53% ​3 585 800 ​0,09% ​ 2 660 336 ​0,07%
​Total ​ R3 185 417 740 ​ 100,00% ​3 975 084 408 ​100% 4 049 095 312 ​100%

Free basic services: Assisting the poorest of the poor

Mr Speaker, apart from the huge investments that we will be making through capital projects we will continue to assist the poorest sections of our City to cope with the hardships of poverty.

For the past three years the Health and Social Development department has spearheaded the registration of indigent households with a view to assisting them with social packages that would cushion their hardships.

The packages assist the households to pay for municipal services. The City provides 12 kilolitres of water and 100 kilowatts of electricity per month. These qualities are twice the amounts recommended by national government.

It is our intention to register 150 000 indigent households by 2016. These would be 90 000, 110 000 and 130 000 households for the 2011/12, 2012/13 and 2013/14 financial years respectively.

The current number of indigent households on our register has been adjusted to 63 000 due to, among other reasons, the exiting of some households from the programme. This number leaves enough room for indigent households in the Kungwini and Nokeng tsa Taemane areas.

In order to achieve the above the City will spend R411,8 million, R564,5 million and R745,9 million for the 2011/12, 2012/13 and 2013/14 financial years respectively, to assist poor households with services.

Financial sustainability of the municipality

Mr Speaker, having outlined only what we consider the highlights of our budget, the major question is whether our financial well-being is sustainable. In answering this question, let me go back to some of my opening remarks.

We pointed out that StatsSA has formally announced that the country is out of the recession. This, overall, means that we have our future in our own hands. Through prudent and careful planning we should be in a position to steer this ship in the right direction.

The City’s leadership – both political and administrative – has over the past few years adopted stringent financial management measures which enabled us to survive the recession. We will continue with these measures.

As indicated earlier, this budget is itself a milestone in two ways. First, it is in line with the IDP needs. Second, it is a balanced budget, meaning that it is not based on deficit planning.

It is, however, our aim to ensure that we end this current financial year on a sound cash-in-the-bank basis. We managed to pay off a short-term loan facility of R800 million at the end of the 2009/10 financial year.

It is our aim to have approximately R150 million in the bank, compared to the R80,1 million with which we ended the 2009/10 financial year.

Going forward, we are currently preparing to enter the Debt Capital Market through the issuing of bonds. The total bond amount that we are planning to issue is R10 billion over the five-year political term, with an amount of R1,5 billion per annum for the next three financial years.

Some of the advantages of issuing bonds include: diversifying our funding base, the potential of raising larger amounts of capital funding, being able to reduce funding costs because bond issuing is a cheaper source of funding, and possible good returns on assets.

It is our considered view that a combination of the above will see us continuing to climb the ladder of running an effective and efficient administration. This we will do, and must do, because of the promise that we made to our people.

Job creation and building communities

Mr Speaker, we have already stated that ours is not just a mechanical budget. Our every step is aimed at improving the quality of life of our people. The government has identified job creation as key towards reducing poverty within our communities. We have also made a commitment to build communities.

Our budget demonstrates commitment to these themes. The huge injection into the capital budget will assist us to create jobs in all our regions. This will come in the form of temporary jobs as we roll out various projects. In other cases, such as the Call Centre in the North, we will realise more jobs, especially for young people who will gain valuable skills.

Mr Speaker, this budget also points to the commitment that this government has to redressing the imbalances of the past. The allocation to the regions will see the communities of Hammanskraal, Suurman, Skampaneng, Majaneng, Soshanguve, Ga-Rankuwa, Atteridgeville, Steve Bikoville, Ekangala, Refilwe, Olivenhoutbosch, in fact all disadvantaged communities, experiencing improved services in the form of rehabilitated roads, better streetlights, filled potholes and quality water services.

The established areas of the East will continue to enjoy quality services. As we always say, we will continue to develop the North, and now the Far East of the City, while maintaining the South and the East. This is the development that our people need. We will not fail them.

Mr Speaker, I hereby present the budget for final discussion.

Thank you.

Source: Tshwane

Tenders & proposals

NB!!! All submissions of proposals will receive an email confirming receipt. Please check your receipt of confirmation.

Request for Proposals: Content coordination and production of awareness raising material for climate change and sustainability/ green economy in the City of Tshwane
Close date: Friday, 30 May 2014
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Call for proposals: Understanding skills and capacity requirements to effectively plan and manage integrated rapid public transport networks
Closing date: Wednesday, 16 April 2014
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Call for proposals:Regulatory framework to promote energy efficiency in municipalities
Closing date: Friday, 04 April 2014
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Call for technical papers: Financial implications of transitioning to a green economy and adoption of climate action for cities
Closing date: Friday, 04 April 2014
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Previous tenders and proposals