Mogale City’s Draft Budget (Part 5): Operating budget continues to grow
MCLM explains in its draft budget for its operating expenditure framework how it is growing.
In part five of the the Mogale City Local Municipality’s (MCLM) recent Medium-Term Revenue and Expenditure Framework (MTREF), or the draft budget, the Krugersdorp News will simplify the operating expenditure framework.
• Also read: Mogale City’s Draft Budget (Part 4): The operating revenue framework
The budget cites for the 2025/ 26 financial year, MCLM’s operating expenses are projected at R5.1b, reflecting a 4% (R621m) increase. National economic forecasts expect GDP growth of 4.4% in 2025/26 and 4.6% in the following two years.
It continues MCLM’s operating budget continues to grow by 13.8%, which is 9.4% higher than national guidelines. This spike is mainly due to significant cost increases, such as Eskom’s electricity tariff (8.3% above inflation) and Rand Water’s price hike (10.9% above inflation).
The operating expenditure framework section concluded that the above-inflation costs heavily influence the budget. As a result, the municipality must closely monitor its spending and apply cost-saving measures to stay within its approved budget and manage cash flow effectively.
