Mangaung Metropolitan Municipality is planning to spend nearly half a billion rand over the next three years on several town and regional planning projects in which it will develop land parcels around the city and the Thaba Nchu and Botshabelo nodes, executive mayor Thabo Manyoni said.
Presenting the 2015/16 budget for the provincial capital at City Hall in Bloemfontein yesterday, Manyoni said the move was aimed at improving people’s living conditions and realigning the setup of the city which was distorted by the apartheid era priorities mainly in the areas of housing, transport and economic development.
The Medium Term Revenue and Expenditure Framework (MTREF) will cover the next three years until 2018.
The mayor said it was important to now build the community and social infrastructure from a perspective of enhancing human development.
“We will spend R444.9 million in implementing a number of town and regional planning projects geared towards the development of land parcels and the Thaba Nchu and Botshabelo nodes,” said Manyoni in his speech titled “Towards a Progressive Budget”.
“The development of Botshabelo and Thaba Nchu Economic Nodes are the city’s uppermost catalytic projects whose aim is to address the erroneous apartheid spatial framework which has designated these areas as mere labour reserves for Bloemfontein,” he added.
The mayor said the city which was working together with the provincial government on the programme will invest about R40 million towards the development of the nodes. The nodal developments will include the development of vibrant rural enterprises, provision of mixed development initiatives, commercial facilities, recreational and social facilities.
“The nodes will attract other investments in these areas and indeed, there can be no limits to concomitant multiplier effects of the projects, which will deal a severe dent to unemployment in the two areas. The inner cities of Botshabelo and Thaba Nchu will be developed by building of new hawker stalls and R19.95 million will be used in the MTREF period,” said the mayor.
Other land development projects earmarked for the next three years include: a township establishment for Brandkop 702 – one of the land parcels for mixed housing development in the city estimated to cost R16 million.
There will be another township establishment for Cecilia Park– one of the land parcels for mixed housing development in the city which will cost R20 million, development of Airport Development Node at R97 million and the development of a long haul service centre in the city at R35 million.
The total revenue budget is projected at about R7.5 billion in the 2015/2016 financial year including capital grants. This represents an increase in revenue of R937 million or 14.3 percent on the 2014/15 adjustment budget of about R6.6 billion. The allocation for the two outer years is nearly R8 billion and R8.4 billion respectively.
The total operating expenditure budget of the municipality is expected to increase from the adjusted budget of nearly R5.7 billion in the 2014/15 to a new budget of over R6.2 billion representing an increase of 9.84 percent or just over R555.8 million in the 2015/16 financial year. The allocation for the outer two years of the MTREF period is R6.6 billion and R7.0 billion respectively.
Manyoni said the budget for salaries, wages and allowances will increase from R1.4 billion to R 1.7 billion representing a growth of 24.80 percent. The indicative allocations for the two outer years of the MTREF period are R1.9 billion and R2.0 billion respectively.
The mayor attributed the increase to the filling of critical positions at the power distribution company Centlec as well as the engineering and economic development departments.
Manyoni said the municipality was slowly finding its footing in terms of its financial management as a result of hiring the relevant skills and heeding expert advice on better management.
“When we took over the reins in 2011 the financial situation in the municipality was characterised by successive financial disclaimers, poor revenue collection, perennial cash-flow challenges, a dismal asset register and poor financial management systems.
“However, we can safely report that currently our cash and equivalents stand at R1.1 billion as compared to R246.4 million in 2011. This reflects a growth of R855.8 million or 347.21 percent which is three times more than previous cash balances.
“This improvement in our financial position has been supported by the attainment of an unqualified audit Opinion in the 2013/14 financial year,” said a confident Manyoni.
The municipality has also set aside over R40 million for a youth economic development programme for this financial year which will be launched in Bloemfontein today (Friday).
The programme, which will have an initial intake of 3 000 youths, is aimed at providing unemployed young people with on the job training and development.
The focus of the programme will be on roads infrastructure maintenance, paving, electrical works, as well as information and communications technology (ICT).
The mayor also announced increases in different rates and taxes for the city. Assessment rates are expected to go up by an average of six percent across the board. But this, according to Manyoni, was the lowest increase among all the metros in the country.
He said the city’s assessment rates for residential properties remain the lowest among the country’s metros at 0.6131 cents.
Sewerage tariffs will be increased by 7.0 percent for residential and 7.5 percent for non-residential properties for 2015/16 and 10 percent for the two outer years.
Water tariffs will go up by 9.3 percent for 2015/16 and 8.0 percent for the two outer years. It has also been proposed that properties valued at over R 70 000 be levied a basic charge of R20 per annum.
Electricity tariffs will be increased by 12 percent (on average) for the 2015/16 financial year. Other general tariffs will be increased by an average of 10 percent with effect from the beginning of next month. Refuse removal tariffs will be increased by 7.5 percent across the board.