The City’s Multi-Party Government passed its adjustment budget yesterday, which will see the municipality through to June 2022, the end of the current fiscal year.
I would, therefore, like to thank all the City officials involved in the technical and strategic processes that got us to this point, as well as our coalition partners for their support.
The Adjustment Budget is, in many ways, a prudent and necessary response to a loan market that is increasingly averse to lending money to municipalities, including metros. This can be further attributed to a lack of liquidity in the market.
The broader financial picture faced by local governments across the country is that capital expenditure has largely been funded by cash and grants, with funding from loans absent.
The fact that there has been a deterioration in revenue collection, means that we have had to arrest the decrease in our surplus to maintain our financial standing so that we can invest in the future through a properly funded infrastructure expenditure programme.
Despite the need to rebase our budget, we are nonetheless pleased to announce that we will be able to deliver on 90% of the commitments made on 11 January, in our Golden Start – the Multi-Party Government’s priorities for the remainder of the 2021/22 budget year.
It does, however, mean that certain projects that were in the original 2021/22 inherited budget will not be achieved, which is regrettable. It is not because there is not a will to complete these projects, but rather that the former political administration did not effectively manage the process to get the projects shovel ready in time.
The truth is that even if we wanted to take money out of the City’s bank account, which we could do in the absence of being able to raise money through further loans, it would be practically impossible to spend it on these projects.
These projects will nevertheless be completed by the Multi-Party Government in the next financial year and beyond.
Despite the tough decisions we have had to make, we are proud to state that we have increased spending on programmes designed to benefit the poor, like the completion of clinics, the funding of housing projects, and improved transport projects.
Some of the increases to the adjustment budget include:
- Rea Vaya BRT-related projects: R53,3-million in additional funding
- R5,7-million in increases for the completion of the Orlando East to UJ Soweto bus route
- Increases in public transportation facilities in Orange Farm total R49-million.
- R136,5-million has been added to City Power infrastructure projects
- A R183,3-million increase for bulk water infrastructure projects
- Increases of R296,5-million for JRA infrastructure projects
- City Parks & Zoo programmes increase by R2,5-million in total
- R37,5-million in increases for the completion of clinics in Alexandra and Orchards
- R93,9-million in additional funding for key housing projects throughout the City
We make no apologies for wanting to get the basics right as we lay down a solid foundation on which we will build a City of opportunities.
Cllr Julie Suddaby
MMC of Finance
City of Joburg