MBOMBELA – The City of Mbombela Local Muncipality was in ICU last year, but now it is only in High Care and even though it is still in hospital, its condition has improved.
This was the analogy used by municipal manager, Neil Diamond when he spoke at the Kruger Lowveld Chamber of Business and Tourism’s (KLCBT) breakfast at Emnotweni Arena on Wednesday.
Current challenges the municipality face
Diamond admitted that they still have a problem with paying creditors within the required 30 days, but that they have been able to reduce the number of days from more than 200 to between 90 and 120.
“I suspect that it will be another three years until we will be able to pay accounts within 30 days, but at least we have made progress.”
Paying them as soon as possible also resulted in saving on interest charges of R20 million or 40 per cent.
The three major bones of contention between the municipality and the citizens of Mbombela were addressed, namely service delivery, water and the municipality’s Eskom account.
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Diamond listed water as the greatest challenge the City faces. “This is a challenge that should have been taken more seriously sooner.” Land has been secured for a new dam and the concession boundaries of Silulumanzi will be extended to include the University of Mpumalanga as well as the Mpumalanga International Fresh Produce Market.
“However, the water provision is not able to meet the demand. We have one of the highest wastages of water in the country.”
Diamond is aiming for more efficient water conservation management and wants 20 per cent reduction in water usage. To help with this, the municipality is fixing all leaking taps and pipes.
The municipality’s Eskom account has been reduced by R100 million but about R105 million is still owed. “Our average usage is about R90 million per month.”
“I will never do anything to compromise the energy provision of the city, but I will not be bullied by Eksom any further and I will not use the money that we use to pay service providers.”
The City is actively looking to enforce payments and it is busy with meter audits.
Diamond admitted that load-shedding is a problem. “We have control over Barberton’s electricity and we have requested to have control over Mbombela’s electricity so that we can enforce load-shedding in the evenings rather than in the day.”
He said they are looking at more sustainable energy sources such as a biomass plant. Diamond understood that citizens still complain about the service delivery.
“We aim to achieve service delivery excellence, but remember our vision is not where we are but where we aim to be. Our focus has now been shifted from planning to effectively implementing all of these plans.”
The City also had an increase in the budget for maintenance and repairs. “We are ensuring that we invest to manage infrastructure.” Other challenges faced included money paid for overtime and the City’s need for the upgrading of IT infrastructure.
“We have reduced overtime expenses by about 20 per cent.” He added that they were looking at the possibility of seamless Wi-Fi and upgrading essential IT services.
Financial results
“When I arrived here the municipality was not in trouble due to corruption or bad leadership, they just had a bad financial model,”
Diamond said and announced the following financial successes.
The municipality saved R140 million from contracted service by using officials to do the jobs they were employed to do. “People were appointed to do certain jobs, not to contract them to other people to do them.”
Sixty-seven per cent of acting management positions have been filled and that cost-effective tariffs have been implemented. The municipality achieved a nett operating surplus ration margin increase of 26 per cent while unencumbered cash reserves increased 300 per cent to R126 million.
Current liabilities were reduced from R1,2 billion to R698 million and that Municipal Infrastructure Grant spending improved to 97 per cent where it usually was around 85 per cent. “We work on a use it or lose it basis so we had to pay money back.”
Irregular, unauthorised, wasteful and fruitless expenditure reduced with R1,171 billion and due to improved efficiency a 23 per cent reduction in expenditure was seen.
Future plans
“Mbombela is alive with possibility and we have one of the highest business confidences in the country, but we can do more. Let us join hands and move forward, we are partners in the economic development of our City,” Diamond said and gave the following plans for the future.
The Integrated Roads and Public Transported Network (IRPTN) will be up and running by July 1, “although I cannot confirm this, but we will try. It is essential for our public transport to function properly.”
The Barberton Makhonjwa Mountains UNESCO World Heritage will be used to the city’s advantage.
“The national Department of Tourism has selected a service provided, but we will ensure that the City plays a pivotal role in the process.”
The Mbombela Housing Agency has been re-established and will function as a municipal entity while the City has shifted its focus to economic development where the City of Mbombela Development Agency will play a bigger role.
Draft budgets
Draft budget 2019/20
• The total will amount to R4 billion from a total budget of R3,9 billion in 2018/19, showing an increase of 1,6 per cent and further increases to R4,3 billion over the medium term
• The operating expenditure budget will amount to R3,4 billion and shows an increase
of six per cent
• The capital expenditure budget which is 15 per cent of the total budget, will amount to R619 million showing a decrease of 17 per cent. It should be noted that this budget excludes 2018/19 rollovers and a report will be tabled to council on or before
August 25
• The total grants allocation will amount to R1,3 billion, showing a decrease of
two per cent.
Capital budget 2019/20 – 2022/23
• The allocation for roads and storm-water infrastructure over the medium term will amount to R576 million and the allocation for 2019/20 is R174 million
• The public transport infrastructure’s budget will be R394 million over the medium term and the allocation for 2019/20 is R147 million
• The bulk water and reticulation infrastructure budgets will amount to R381 million over the medium term and the allocation for 2019/20 is R131 million
• Electricity supply and management infrastructure will amount to R87 million over the medium term and the allocation for 2019/20 is R27 million
• Sanitation and sewerage infrastructure will amount to R73 million over the medium term and the allocation for 2019/20 is R30 million.
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