Table of Contents 1.1 Report 1.2 Council Resolutions Abbreviations and Acronyms AMR Automated Meter Reading CFO Chief Financial Officer CPI Consumer Price Index DBSA Development Bank of South Africa DoRA Division of Revenue Act DWA Department of Water Affairs EE Employment Equity FBS Free basic services GDP Gross domestic product GFS Government Financial Statistics GRAP General Recognised Accounting Practice HR Human Resources IDP Integrated Development Plan IT Information Technology kℓ kilolitre km kilometre KPA Key Performance Area
KPI Key Performance Indicator kWh kilowatt ℓ litre LED Local Economic Development MFMA Municipal Financial Management Act Programme MIG Municipal Infrastructure Grant MM Municipal Manager Properties Rates Act MSA Municipal Systems Act MTEF Medium-term Expenditure Framework MTREF Medium-term Revenue and Expenditure Framework NERSA National Electricity Regulator South Africa NGO Non-Governmental organisations NKPIs National Key Performance Indicators PMS Performance Management System PPE Property Plant and Equipment PPP Public Private Partnership SALGA South African Local Government Association Service Delivery Budget Implementation Plan SMME Small Micro and Medium Enterprises
The following table compares current and proposed amounts payable from 1 July 2018: Table 7 Comparison between current waste removal fees and increases Category Current tariff (1 July 2017) Proposed tariff (1 July 2018) Residential 71.53 75.84 Business 133.04 141.04 Hospital /Schools/Hostel 133.04 141.04 Operating Expenditure Framework The Municipalities expenditure framework for the 2018/19 budget and MTREF is informed by the following: Balanced budget constraint (operating expenditure should not exceed operating revenue) ; Funding of the budget over the medium-term as informed by Section 18 and 19 of the MFMA; The capital programme is aligned to the backlog eradication plan; Operational gains and efficiencies will be directed to funding the capital budget and other core services; and Strict adherence to the principle of no project plan no budget. If there is no business plan no funding allocation can be made. The following table is a high level summary of the 2018/19 budget and MTREF (classified per main type of operating expenditure): Table 8 Summary of operating expenditure by standard classification item Expenditure - Functional Governance and administration 29 530 28 244 31 236 35 203 35 203 35 203 44 763 46 680 48 712 Executive and council 3 585 3 791 4 242 5 200 5 200 5 200 2 597 2 750 2 908 Finance and administration 25 945 24 453 26 994 30 003 30 003 30 003 42 166 43 930 45 804 Internal – – – – – – – – – Community and public safety 266 – – 2 339 2 339 2 339 45 48 51 Community and social services 186 – – 2 339 2 339 2 339 45 48 51 Sport and recreation 80 – – – – – – – – Public safety – – – – – – – – – Housing – – – – – – – – – Health – – – – – – – – – Economic and environmental services 3 546 4 954 6 393 4 753 4 753 4 753 540 572 607 Planning and development 897 766 1 531 2 265 2 265 2 265 285 302 320 Road transport 2 649 4 188 4 862 2 488 2 488 2 488 255 270 287 Environmental protection – – – – – – – – –
Item No Period Activity Co – Department Responsibility Legislative Requirement and Information Target date Progress against target & Comments 1 Jul 2017 Signing of 2017/18 performance contracts for Section 56 Managers. Office of the MM Municipal Manager MFMA S53(1)(c)(iii) 31 July 2017 2 Section 56 Managers 2016/17 Performance Assessments MM Municipal Manager Mayor MSA and MFMA 31 July 2017 3 Aug 2017 Tabling of and briefing Council on the 2018/19 IDP/Budget Process Plan for approval, including time schedules for IDP/Budget Public participation meetings. IDP Office/BTO Chief Financial Officer MFMA S21(1)(b) 23 August 2017 4 Sep 2017 Advertise the budget process and dates of IDP/Budget Public meetings on Municipal Website IDP Office Municipal Manager MSA and MFMA 15 September 2017 5 Oct 2017 Ward Committee Meetings: Discuss, scrutinise community as outcome of IDP/ Budget public engagement. Escalate community needs relating national/ provincial mandates to relevant organ(s) of state IDP Office IDP Office MSA 09 – 13 October 2017 6 Submit Bulk Resource documentation electricity (NERSA)) for consultation on municipal tariffs for 2018/19 and the two outer Budget years. BTO CFO Internal Process 30 October 2017 7 Submit Quarterly Report (July 2017 – September 2017) on implementation of budget and financial state of affairs to Council Office of the MM MFMA S52(d) 27 October 2017
8 Nov 2017 Managers Identify/Create Projects as outcome of the prioritisation of development during IDP public engagements sessions within projected budget allocations. All Departments Project Manager MSA 30 November 2017 9 Jan 2018 Request and/ or follow-up with NERSA/ other Bulk Service providers for feedback on proposed municipal 2018/19 tariffs and engagement documentation submitted in October 2017 BTO CFO MFMA 24 January 2018 10 Tabling of 2017/18 Mid-Year Assessment Office of the MM Municipal Manager CFO MFMA S72 25 January 2018 11 Submit Quarterly Report (Oct 2017 – Dec 2017) on implementation of budget and financial of affairs to Council. Consider combining with MFMA S. 72 performance assessment. Office of the MM Mayor MFMA S52(d) 31 January 2018 12 Tabling of 2016/17 Annual Report to Council Office of the MM Municipal Manager MFMA S127(2) 25 January 2018 13 Feb 2018 Submit Annual Report to Provincial Treasury and Office of the MM Municipal Manager MFMA S(127)(5)(b) 09 February 2018 14 Ward Committee Meetings: Discuss and brief Ward Committees on Council’s revised strategic plan, Strategic Objectives and envisaged deliverables. IDP Office IDP office Internal Process 05 – 16 February 2018 15 Review tariffs and charges and determine affordable tariffs and finalise income budget. BTO CFO MFMA s20 28 February 2018 16 Midyear budget engagements BTO CFO MFMA S127 12-23 February 2018
17 Municipalities receive inputs from National and Provincial Government and other bodies on factors influencing the budget, e.g. Grant Allocations Office of the MM BTO Municipal Manager CFO MFMA21(2)(c) 19– 28 February 2018 18 Adjustment Budget: Finalise Capital and Operational budget projections for 2016/2017 BTO CFO MBRR 21 22 February 2018 19 Mar 2018 Review all budget related policies BTO CFO MBRR 7 19 – 23 March 2018 20 IDP, Budget and proposed tariffs with Council Provide progress update to council against IDP/Budget process schedule and obtain approval for any adjustments to process. IDP Office BTO IDP Office CFO Internal Process 30 2018 21 Publication of approved Draft Budget after approval per MSA and on municipal website BTO CFO MBRR 26 30 March 2018 22 Council to Consider and adopt an oversight report on 2016/17 Annual Report Office of the MM Municipal Manager MFMA S129(1) 30 2018 23 April 2018 Advertise & Inviting public comments on Draft Budget, Proposed Tariffs, and IDP Place copies of Draft Budget and IDP at all municipal buildings. Corporate Services BTO Director Corporate Services CFO MBRR S15 MFMA S22 2 – 30 2018 24 Forward Copy of preliminary approved Budget ,IDP, SDBIP & related documents (hard and electronic copies) to National & Provincial Treasury – 10 working days after tabling Office of the MM CFO IDP Manager MFMA S22(b) 6 April 2018
Service charges 6 262 10 554 10 664 15 246 15 246 15 246 7 498 18 364 19 480 20 675 Other revenue 1 636 1 995 35 749 1 029 1 029 1 029 29 287 329 358 366 Government - operating 1 17 963 15 057 22 167 23 498 23 498 23 498 16 981 23 183 25 385 27 418 Government - capital 1 9 129 7 960 8 406 9 182 – – – Interest 141 141 885 5 034 5 034 5 034 7 4 104 4 351 4 611 Dividends – – – Payments Suppliers and employees (26 920) (26 365) (61 490) (52 821) (52 821) (52 821) (59 336) (46 491) (49 307) (79 349) Finance charges (679) (2 358) (1 955) (172) (172) (172) (38) (212) (224) (239) Transfers and Grants 1 (1 623) (6 385) – – – NET CASH FROM/(USED) OPERATING ACTIVITIES 8 339 8 992 17 813 51 51 51 5 433 7 659 8 928 (17 100) CASH FLOWS FROM INVESTING ACTIVITIES Receipts Proceeds on disposal of PPE 52 1 103 – – – Decrease (Increase) in non-current debtors – – – Decrease (increase) other non-current receivables – – – Decrease (increase) in non-current investments – – – Payments Capital assets (9 092) (10 489) (10 155) – – – NET CASH FROM/(USED) INVESTING ACTIVITIES (9 040) (9 386) (10 155) – – – – – – – CASH FROM FINANCING ACTIVITIES Receipts Short term loans 274 541 – – – Borrowing long term/refinancing – – – Increase (decrease) in consumer deposits 1 339 (5) 106 – – – Payments Repayment of borrowing (241) (437) (351) – – – NET CASH FROM/(USED) FINANCING ACTIVITIES 1 372 99 (245) – – – – – – –
Service charges - water revenue 3 793 2 838 3 817 3 723 3 723 3 723 6 047 5 032 5 309 less Revenue Foregone (in excess of 6 kilolitres per indigent household per month) 572 572 less Cost of Free Basis Services (6 kilolitres per indigent household per month) – – – – – – 1 273 1 349 1 417 Net Service charges - water revenue 3 793 2 838 3 817 3 151 3 151 3 723 – 4 774 3 683 3 892 Service charges - sanitation revenue Total Service charges - sanitation revenue 1 289 1 148 1 418 1 470 1 470 1 470 2 035 1 820 1 920 less Revenue Foregone (in excess of free sanitation service to indigent households) 144 144 less Cost of Free Basis Services (free sanitation service to indigent households) – – – – – – 308 326 343 Net Service charges - sanitation revenue 1 289 1 148 1 418 1 326 1 326 1 470 – 1 727 1 494 1 577 Service charges - refuse revenue 6 Total refuse removal revenue 1 661 1 656 1 465 1 621 1 621 1 621 3 269 2 457 2 592 Total landfill revenue less Revenue Foregone (in excess of one removal a week to indigent households) 526 526 less Cost of Free Services (removed once a week to indigent households) – – – – – – 938 994 1 044 Net Service charges - refuse revenue 1 661 1 656 1 465 1 095 1 095 1 621 – 2 331 1 463 1 548
Other Revenue by source Fuel Levy 842 1 089 4 394 860 860 860 Other Revenue 145 164 161 'Other' Revenue 1 842 1 089 4 394 860 860 860 – 145 164 161 EXPENDITURE ITEMS: Employee related Basic Salaries and Wages 2 16 044 17 426 20 678 25 014 25 014 25 014 17 800 18 897 20 065 sub-total 5 16 044 17 426 20 678 25 014 25 014 25 014 – 17 800 18 897 20 065 Less: Employees costs capitalised to PPE Total Employee related costs 1 16 044 17 426 20 678 25 014 25 014 25 014 – 17 800 18 897 20 065 Total Contributions recognised - capital – – – – – – – – – – Depreciation & asset impairment Depreciation of Property, Plant & Equipment 9 648 11 321 14 807 8 923 8 923 8 923 8 923 8 923 8 923 Lease amortisation Capital asset impairment Depreciation resulting from revaluation of PPE 10 Total Depreciation & asset impairment 1 9 648 11 321 14 807 8 923 8 923 8 923 – 8 923 8 923 8 923 Bulk purchases Electricity Bulk Purchases 4 873 8 709 10 893 12 182 12 182 12 182 13 209 14 002 14 898 Water Bulk Purchases 331 351 373 Total bulk purchases 1 4 873 8 709 10 893 12 182 12 182 12 182 – 13 540 14 353 15 271 Transfers and grants Cash transfers and grants – – – – – – – – – – Non-cash transfers and grants – – – – – – – – – – transfers and grants 1 – – – – – – – – – – Contracted services
List services provided by contract 647 2 690 4 701 2 652 2 652 2 652 3 225 3 418 3 623 sub-total 1 647 2 690 4 701 2 652 2 652 2 652 – 3 225 3 418 3 623 Allocations to organs of state: Electricity Water Sanitation Other contracted services 647 2 690 4 701 2 652 2 652 2 652 – 3 225 3 418 3 623 Expenditure By Type Collection costs Contributions to 'other' provisions Consultant fees Audit fees General expenses 3 5 558 4 154 4 867 5 736 5 736 5 736 7 469 7 917 8 392 List Other Expenditure by Type Total 'Other' Expenditure 1 5 558 4 154 4 867 5 736 5 736 5 736 – 7 469 7 917 8 392 Repairs and Maintenance by Expenditure Item 8 Employee related costs materials Contracted Services Other Expenditure 1 860 1 972 2 090 Repairs and Maintenance Expenditure 9 – – – – – – – 1 860 1 972 2 090