“Our water consumption tariff is way above other municipalities.
Our tariff structures are not pro-poor.”
Councillor Elrick van Aswegen
The Municipal Budget Circular provides guidance to municipalities and municipal entities as they prepare for their 2015/2016 budget which will be voted for by Knysna’s Council in May and initiated in July.
It first states the obvious which is that “South Africa’s economic performance has deteriorated” and that the “outlook poses new fiscal challenges”. Consequently, municipalities are warned to not only be cost-conscious but conservative when projecting their income i.e. expecting too much could lead to monetary shortages for intended projects later in the year.
This immediately heads into difficult territory when you consider that SALGA (South African Local Government Association) tabled a 4.4% salary increase for municipal employees BUT since negotiations are still underway, it’s highly possible (looking at history) that the actual increase will be higher.
Regards conditional grants, if they are not spent before the end of the financial year, they will be lost to the National Revenue Fund. However, if the “receiving officer proves to the satisfaction of National Treasury that the unspent allocation is committed to identifiable projects, it may be rolled over.”
Regards electricity tariffs, NERSA has recommended a 12.2% increase (note that bulk purchases from Eskom increased by 14.24% meaning that the Municipalities revenue would drop).
At the Section 80 Finance Committee Meeting held in Council Chambers this morning, COPE Councillor Elrick van Aswegen asked: “Did we cut down on consultant fees in the forthcoming budget.” The Finance department was unable to answer and said they’d know within weeks. If that wasn’t a dodge, then it was highly disturbing that they haven’t made a concerted effort to address the issue after being instructed to do so by National government.
Van Aswegen aimed his questioning to the Directors: “How serious are you to cut down on consultants and service providers?”
Mike Maughn-Brown (Director Planning and Development) answered with “No, not in my mind. I look at how can i do the job in the most effective way. I try not to be constrained by bureaucratic constraints. Fundamentally, i try. The use of consultants is the most cost-effective way. Consultants carry professional indemnity. We try cut costs where we can but that’s not specifically regarding consultants.”
Dawie Adonis (Director Community Services) shared his approach with, “Our network requires lots of care. My staff are running all the time. They do not have time to plan projects.”
Bevan Ellman (Director of Corporate Services) reminded that the Circular “is not a legislation. It is not a law.”
Van Aswegen expressed his concern at Ellman’s attitude saying that the MFMA Circulars help us understand the law.