The Indaba was held recently and Cllr Sithole reminded the people that other issues were death with in the IDP and a special meeting was
held at Klarinet to discuss those issues.
Chief financial officer Mr Ben Dorfling presented the draft budget. The total operating and capital budget for the 2014/2015 financial year is R2,094,928, 707 broken down as follows: operating budget: R1,915,626,867 91.44% and the capital budget is R 179, 301,840 with a 8.56%.
In remuneration R266, 167 has been budget for with an increase of 11.78 % from last year, for overtime and standby R44 483, 269.82 %, Other costs 141,324 24.49%, council remuneration R19,144 0.2% total remuneration is 471,118 21.66%, Eskom R701,705 8.06%, water R36,592 5.0%, water purification R36,592 -6,92%, sewerage purification R34, 623 36.34%, total bulk service R804,056 8.21%.
External interest R12,920 –12.73, Sundry R118,508 4.08%, non cash flow items R49,256 –20.36%, other cost were R180,684 -4.03% total general cost R984,740 5.40%.
Repair and maintenance R82,752 4.0%, depreciation R163.985 0%, contributions: sundry R100 0%, bad debts R215,257 34.45%, total contributions R251,357 34.24%, contributions to capital R179,302 8.91%
Total budget R2,094,928 11.0%.
Provision was made for a salary increase of 7%. Over 360 employees have been appointed over the past year in order to stabilize service delivery in particular on the lower levels of the staff establishment.
There was a need to appoint staff at high levels to bring capacity and competency. It was mentioned that it was critical to decrease overtime and standby with at least R20 million in order to safeguard these monies to implement the newly developed structure. Council are spending 22.49% on staff cost of the total budget including the capital outlay. If capital outlay is excluded the percentage increases to 24.6 % which is well within the acceptable limit.
Bulk electricity purchase increased with 8.06%. The current loss in electricity distribution is estimated at 25%; this is affecting the selling price of electricity and affects payment to Eskom. Council will have to secure the loss of R290 million in order to stabilize the service.
Council will purchase 16 ML per day from Anglo mine as and when required. This amounts to R 34 849 143 per year for the 2014/2015 financial year and increase with 5%. The current loss of water distribution is estimated at 52% which is 7% lower than the previous year. More than 12,000 meters has been installed and pipe bursts have been repaired in order for the loss to decrease.
The outstanding loans as at 30 June 2013 is R184 894 116. No new loans will be taken up to 2014/2015 financial year unless council decides to procure protective structures in order to secure the loss in electricity. Interest of R16 130 161 will be payable on the total outstanding loans of R184 894 119.
Indigent subsidy R34 547 552, subsidy assessment rates R292 500, departmental charges R26 071 287, bad debt provision R215 257 000, depreciation R163 985 000 and the total is R440 153 339. The above non-cash items must be used to finance the redemption on the loans as well as arrears on creditor payments.
Tariff increases; electricity – 10.4%, water – 8%, refuse removal – 11% including truck repairs, sewer – 8%.
The first R50 000 on land and improvements will be exempted from July 1 2014 for all households. The tariff increase by 8% as from July 1 2014 and a new valuation roll will be implemented.
Due to the new roll some people with higher values on their houses will pay more than 8% if the value of their houses increased more than the average. Pensioners and farmers must apply for additional discount.
