Transcript budget - eThekwini Municipality

DURBAN
CHAMPIONING THE INDIGENT
MAXIMISING SERVICE DELIVERY
CREATING HIGH-QUALITY LIVING ENVIRONMENTS
DRIVING INVESTMENT IN PUBLIC INFRASTRUCTURE
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A PREVIEW OF THE 2008/2009
MUNICIPAL BUDGET
MANAGING
PUBLIC
FUNDS
PRUDENTLY
CONTENTS
FOREWORD FROM THE LEADERSHIP
AN INCLUSIVE BUDGET
WINNING BECAUSE WE DELIVER
A LONG-TERM VISION
A COMPLEX OPERATING BUDGET
GOING BEYOND OUR MANDATE
PLATFORM INFRASTRUCTURE
PROVIDING RESOURCES
SUPPORTING OUR COMMUNITIES
A DIVERSE RANGE OF LINE SERVICES
KEEPING TARIFFS REALISTIC
A SIGNIFICANT CAPITAL BUDGET
MANAGING LEGISLATIVE CHANGE
A GOOD FINANCIAL RECORD
COMPARING WITH OUR COUNTERPARTS
UNQUALIFIED FINANCIAL STATEMENTS
STIMULATING THE ECONOMY
READINESS FOR 2010
MEASURING THE ECONOMY
INVESTMENT IN THE CITY
CARING FOR ALL OUR CITIZENS
PROVEN CAPABILITIES
THE BUILDING-BLOCKS FOR SUCCESS
A METRO THAT IS OPEN TO DISCUSSION
WE CARE, WE BELONG, WE SERVE
FOREWORD FROM THE LEADERSHIP
There are a number of interventions that government, at all levels, has introduced to
better the lives of the poor and disabled. Recently, the national Minister of Finance
lessened their financial burden by increasing their grants. We have incorporated this
principle into our 2008/2009 budget. Some 108000 households will be exempt from
paying rates as opposed to the 72000 households previously. Further, government
subsidises these households in respect of free basic services. About 227000 (55%)
of households will receive a reduction in rates. Properties valued less than R400000
according to the latest property valuations will be exempt from rates if those
households are headed up by children or pensioners. Higher-valued properties
owned by this demographic will have rates levied on the portion that exceeds
R400000. This consideration has also been extended to those who are boarded on
medical grounds or receive government disability grants, allowing for a more
equitable and effective system of taxation.
Our Long-Term Development Framework (LTDF) clearly maps out the strategy for
the City over the next twenty years. In an effort to achieve our 2020 vision, the LTDF
details the complex development priorities facing us. The essence of the LTDF is to
achieve a balance between meeting basic needs, strengthening the economy,
developing people skills, and creating a technology base for the future. In an effort to
achieve our 2020 vision, these four Strategic Focus Areas of intervention need to be
balanced and integrated. It is mandatory that the City’s budget be a pro-growth one
that meets basic needs and builds on existing skills and technology.
We will continue to balance the requirements of having a pro-poor budget whilst
funding infrastructure that facilitates the creation of a strong economy.
MR. OBED MLABA
MAYOR
Year-on-year, the challenges faced by metropolitan authorities in South Africa
becomes increasingly more complex. Cities are seen as havens for jobs, better
livelihoods, access to superior public infrastructure and business opportunities by
rural communities. Yet, it is cities that face the biggest hurdles with this population
migration. The need for services increases dramatically, placing great strains on
already-stretched municipal budgets. With this rise in city populations, there is little
corresponding increases in terms of income for the Municipality. Revenue
increases from rates and our trading services like water and electricity are quite
rightly capped within acceptable national limits. Thus, our challenges as a metro
are immense. The demands created by basic human needs are high, straining the
resources of a low-growth base in real terms. Into our ninth year of the new
millennium, many indigent people still do not have access to acceptable housing,
water supply, sanitation and electricity. It is within these limiting financial constraints
that eThekwini continues to provide a vast array of public services including:
housing, transport, water, sanitation, roads, security, refuse removal, emergency
services, libraries, clinics, social services, economic infrastructure and even
opportunities to local SMME’s. Concomitantly, our budgets are developed with a
specific pro-poor focus.
At the same time, we are committed to enhancing our enabling environment to
support business and attract investment. Accordingly, we have created the relevant
platform infrastructure over the years as well as increased bulk services for
business to utilise or access. Further to this, we have a significant capital
expenditure spend of over R50 billion projected over the next ten years. In addition,
for the 2008/2009 financial year, the repairs and maintenance portion of the budget
is 10.8%, which is well above the norm for any other local metro.
As promised in our inaugural brochure last year, we endeavour to provide an
annual update on our budget and its related processes. Every year, we will choose
a specific aspect of our budget to highlight. Due to the current discussions around
the new Municipal Property Rates Act (MPRA), which comes into operation in the
2008/2009 financial year, we will focus on providing some background information
on the Act and its implications for the Municipality and the ratepayers of Durban. As
expected, misinformation has circulated, creating dissent about the re-assessment
of properties from certain quarters. As we have been reiterating, this process will
provide market parity in evaluations within the city.
eThekwini is a complex organisation as can be gleaned by the services we provide,
in addition to us managing a R23 billion budget, and with over 18000 workers in our
employ. Our budget process is consultative and our strategic intent in terms of the
Integrated Development Plan (IDP) is developed with all our stakeholders. Thus,
despite the sometimes overwhelming impediments that face us in making Durban
the most liveable city in Africa, we always strive to create solutions that benefits all
our citizens.
DR. MICHAEL SUTCLIFFE
CITY MANAGER
MR. KRISH KUMAR
CITY TREASURER
AN INCLUSIVE BUDGET
The creation of our municipal budget is a consultative process. As this entails the management of council funds, we liaise with civil
society and business. The budget is developed within the framework of the Municipal Finance Management Act. Added to this, it
must align with the City’s Integrated Development Plan (IDP). Below is a description of the process.
September
• Process
begins with
assessment of
the previous
year’s
Budgets.
• Development
of the first
draft Budgets.
• Review of
IDP.
October
• Draft tariff
estimate
report
commences.
• Draft Capital
Budget is
developed.
• Draft
Operating
Budget is
developed.
November
• EXCO
(Council’s
Executive
Committee)
discusses the
proposed tariff
increases and
lifeline
policies.
December
• Council
approval of
Capital
Budget.
• Draft
Operating
Budget is
presented to
Council.
January
• Operating
Budget
review.
• Presentation
of revised
Operating
Budget to
EXCO and
Council.
February
March
April
May
• Finalisation of
tariff
estimates and
rates
increases.
• Presentation
of Budgets to
Business.
• Proposed
increases
tabled at
Council by the
Mayor.
• Public
hearings on
Budgets.
• Regional
hearings on
Budgets.
• Approval of
final Budgets
by EXCO and
the rest of
Council.
• Service
Delivery
Budget
Implementatio
n Plan
(SDBIP)
finalised.
Refinement of Operating Budget at
Each Stage
In compliance with the Municipal Structures Act (1998) and Municipal Financial
Management Act (2003), our city budget is informed and aligned to the IDP objectives.
The IDP determines and prioritises the needs of the community. The budgetary
allocations for both the capital and operating expenditure are undertaken in a manner that
will not only ensure that our IDP outcomes are achieved but also to ensure that our city’s
2020 vision is realised.
We have come a long way in capital budgeting, away from departmental budgeting.
Currently the capital budget is allocated according to the IDP eight-point plan. During the
2008/09 IDP revision process, this allocation process was further entrenched through
committing to make hard choices. In terms of the operating budget we have made an
excellent start but are now more committed than ever to ensure that critical operating
budget resources are prioritised in terms of stated IDP outcomes.
More importantly, the Performance Management System (PMS) allows the municipality an
opportunity to monitor and evaluate individual and organisational performance in meeting
our IDP outcomes and vision.
CIVIL
SOCIETY
ADMINISTRATION
BUDGET
LEGISLATION
BUSINESS
THE BUDGET IS AN INTEGRATED PRODUCT DEVELOPED
WITH INPUT FROM MAJOR STAKEHOLDERS
WINNING BECAUSE WE DELIVER
DID YOU KNOW THAT WE?
•Delivered of 75000 housing units during the five year period 2002-2007.
•Provided 6kl of free basic water per month to 965480 households (including apartments) in 2007.
•Extended water and sanitation (new service) to 18000 households per annum
•Constructed 32km of new roads, 165km of sidewalks, 201km of gravel to ‘black-top’ roads and
33 pedestrian bridges 2002-2007.
•Extended refuse-removal (new service) to 159000 households per annum during the five year
period 2000-2005.
•Provided 155188 new electricity connections 1997-2007 and built 15 new major sub-stations
2003-2007.
The Municipality kept its winning ways throughout 2007. Some of the achievements being: Winner of
the Vuna
Awards for
being the
best
performing
Metro in
the country
(financial
viability),
for the third
consecutiv
e year.
Best
Municipality
in Africa –
Afriglobe
Awards.
United
Nations
Public
Service
Award –
Water
services
debt relief
scheme.
Diamond
Arrow Award
for bringing
investment to
the Province
(DIPA).
SAICE
Golden Arrow
award for the
Marianhill
Landfill
Conservancy
project
Silver Gilt
Award –
Chelsea
Flower Show.
Silver Gilt
Award –
Chelsea
Flower Show.
Professional
Management
Review
Award for
most
Proactive
Mayor.
Award for
technical
excellence for
the Umhlanga
Rocks Pier.
A LONG-TERM VISION
INTEGRATED
DEVELOPMEN
T PLAN
Quality Living
Environments:
Economic
Development
and Job Creation:
CITIZENS LIVING IN HARMONY.
A CARING CITY.
A CITY THAT WE ARE PROUD OF.
Financial
Viability
and
Stability:
R 15 191 422 960 R 3 896 404 910 R 1 676 437 225
Safe, Healthy
and Secure
Environments:
R 992 223 561
Good
Governance:
Embracing Our
Cultural Diversity:
R 780 798 095
R 343 322 820
The above pillars serve as the core guides in the design of our operating and capital
budgets for 2008/2009.
Sustaining Our
Built and
Natural
Environment:
R 223 680 969
OUR IDP
VISION
Empowering Our
Citizens:
R 148 484 220
Support
Services
and
Other:
R 147 136 000
A COMPLEX OPERATING BUDGET
KEY ISSUES
WHERE THE MONEY COMES FROM
Rental of Facilities & Equipm ent
R141.3M
Fines, Licences & Perm its
R158.3M
Penalties & Collection Charges
R163.2M
Other Incom e
RATES AND GENERAL
•Salary increase of 8.75%.
•Provision for critical vacancies – R80 million (includes 200 Trainee
Constables, Fire Safety, IT, Health, Skills, Municipal Court, and
Planning & Development Staff.
•Interest on loans increased due to additional loans from DBSA
being taken (R35m).
•Provision for Bad Debts (Increased by R200m).
•Additional Repairs and Maintenance (R157.9 million).
•95% collection rate.
R257.4M
Interest on Investm ent
R362.1M
Grants & Subsidies
R4 755.6M
Assessm ent Rates
R4 946.2M
Service Charges
R6 686.1M
0
1000
2000
3000
4000
5000
6000
7000
8000
TOTAL OPERATING BUDGET R17 470.2M
HOW THE MONEY WILL BE USED
Corporate & Hum an Resources
R184.1M
Governance
R265.2M
Sustainable Dev. & City Enterprises
R601.5M
Office of the City Manager
WATER
•Bulk purchases tariff increase – 2% .
•Provision for Bad Debts – R107 million.
•Salary increase of 8.75%.
•Impact of Capital Projects (R1040.7m) on operating, e.g.. Western
Aqueduct (R250m), Replacement of pipes (R100m).
•Water loss is currently at 36%, targeting 30% for 2008/09. (9% of
the 36% represents leakage from mains and this is being
addressed through the AC mains replacement project.)
•95% collection rate.
R1 344.1M
Treasury
R1 579.1M
Health, Safety & Social Services
R1 994.1M
Procurem ent & Infrastructure
R11 502.1M
0
2000
4000
6000
8000
10000
12000
14000
TOTAL OPERATING BUDGET R17 470.2M
TOTAL OPERATING BUDGET = R17.470 billion.
ELECTRICITY
•Eskom bulk purchase tariff increase – 15.2%.
•Salary increase of 8.75% and recruitment of skilled professionals.
•Provision for Bad Debts increased by R20m
•Rollout of Infrastructure to new areas / developments
•No provision for REDS implementation
•Levy of 2 cents per kwh. An additional R228.5m will be levied to
consumers on behalf of SARS.
•98% collection rate.
GOING BEYOND OUR MANDATE
KEY ISSUES
AFFECTING THE
OPERATING
BUDGET
Salaries and Allowances
This expenditure is continually being reviewed and as a result the
percentage of Salaries and Allowances of the total Operating Budget has
declined steadily over the years to an acceptable level of 27.6%. The
placement of staff in accordance with the recent restructuring process is near
completion. However, the Municipality will continue to look at new ways of
doing business, improving productivity, implementing Business Process Reengineering (BPR) and undertaking restructuring initiatives in order to
maintain this expenditure at acceptable levels. Furthermore, in terms of the
placement policy negotiated with Labour, temporary Council contract
employees who were employed for a continuous period of two and a half
years (30 months) as at 1 April 2003 may be placed in permanent positions.
Unaccounted for Water (Loss in Distribution)
Unaccounted for water is determined by comparing the water purchase
volumes with sales volumes. It is estimated that for the 2008/09 year, the
targeted loss in distribution will be a reduction to 30% from current level of
35%. The water loss intervention programme to reduce the water loss to
more acceptable levels is continuing with further funding provided to appoint
specialist consultants to assist the process and the replacement of ageing
infrastructure. Every possible measure will be taken to curb the water loss as
this has an impact on the setting of an affordable water tariff. The
effectiveness of the measures put into place will be reviewed on an ongoing
basis.
Unfunded Mandates
The eThekwini Municipality provide Health Services, Libraries, Museums,
and Housing. The reduction or non-payment for these services by other tiers
of government requires the Municipality to allocate its own resources to
make up the shortfall.
Regional Electricity Distributors (REDS)
The necessity for RED’S is appreciated by Council. However, the institutional
framework i.e. the public entity model may impact on the Municipality’s
funding given the significant reliance in terms of both income and leverage
for credit control. The Council, however, supports the SALGA position in this
matter i.e. there must be no impact on the finances of the Municipality and it
must not adversely impact on the customer’s payment for services.
Load Shedding - Electricity
The recent load shedding experienced throughout the country also poses a
challenge. As a broad assumption, a 5% reduction in energy
(consumption/purchase) will reduce the units gross income margin by R 95
million. In order to cover this potential shortfall in income, Council will be
implementing a surcharge of 3% on electricity consumption with effect from
2008-07-01.
Council is in the process of carrying out a load shedding-awareness
campaign to reduce consumption by 10%. In addition, more energy-saving
light bulbs will be distributed and the likelihood of load-controlling geyser
switches will be phased in this year. The rollout of energy saving light bulbs
has already saved about 130MW for the City.
PLATFORM INFRASTRUCTURE
Infrastructure Provision and Repairs and Maintenance continues to draw a large proportion of our budgets.
Total expenditure for 2008/2009 is R1.62 billion: -
ITEM / DESCRIPTION
R’ m
Rehabilitation of housing rental stock to facilitate the sale of approximately 3000 units in terms of the Housing
Sales Campaign:
85.0
Maintenance of Road Network and Asphalt road surfacing inherited from other entities: Addressing of
backlogs and higher frequency of maintenance (increase of):
82.0
Maintenance of additional storm water infrastructure inherited from other entities together with addressing the
flood damage backlog (increase by R 10.3m to):
15.3
Repairs and maintenance of ageing infrastructure and expansion of water services to rural areas:
246.8
Repairs and maintenance to the electrical network due to increased faults and planned maintenance:
351.1
Verge maintenance - Grass cutting (including new areas) - Increase by R 5m to:
20.0
Contract for reinstating and maintaining all red robot cameras:
3.0
Maintenance of ablution blocks in informal areas (improving sanitation):
4.0
Implementation of a comprehensive maintenance plan within the fire department for specialised fire fighting
equipment:
2.0
Maintenance of the entire Information Technology network of the Municipality:
17.0
OUR REPAIRS AND MAINTENANCE PORTION OF THE BUDGET IS 10.8%, WHICH
IS HIGHER THAN ANY OTHER METRO
PROVIDING RESOURCES
• The hiring of new staff for critical vacancies and
salary increases of 8.75% with effect from 1 July
2008 takes up a significant proportion of the
Operating Budget.
• This expenditure is continually being reviewed
and as a result the percentage Salaries and
Allowances of the total Operating Budget has
declined steadily over the years to an acceptable
level of 27.6%. The placement of staff in
accordance with the recent restructuring process
is near completion. Whilst provision has been
made in the budget for the review and revision of
grades, the full impact can only be determined
once the grading process has been completed.
However, the Municipality will continue to look at
new ways of doing business, improving
productivity, implementing Business Process Reengineering (BPR) and undertaking restructuring
initiatives in order to maintain this expenditure at
acceptable levels.
• Furthermore, in terms of the placement policy
negotiated with Labour, temporary Council
contract employees who were employed for a
continuous period of two and a half years (30
months) as at 1 April 2003 may be placed in
permanent positions. This expenditure has been
partially funded based on the anticipated
effective date of placement.
• As a result of the annualised effect of vacancies
filled during 2007/2008, the use of temporary and
agency staff and the provision for task regarding,
the year on year increase on employee related
costs is 13.1%.
• The Salaries and Allowances Task Team will
continue to monitor the top 150 earners and staff
that receive overtime in excess of 50% of their
basic salary. In order to comply with the Basic
Conditions of Employment Act, staff that work
more than 10 hours overtime per week will be
investigated in order to reduce overtime costs.
The table below details the additional posts and related operations that need to be filled /undertaken
in the 2008/2009 financial year (R300 million)
ITEM / DESCRIPTION
New personnel and operational costs in respect of hostels taken over from KZNPA
Provision for filling of 41 critical vacant posts for libraries
R’m
124.0
8.4
Provision for filling of 231 vacant posts for Parks, Recreation, Cemeteries and Culture
28.0
Provision for recruiting 193 authorised officers to assist with traffic violations
16.0
Learnership Programme for 200 Peace Officers
4.0
Additional staff requirements to assist with the illegal occupation of newly built houses
3.0
Staffing resources at new clinic in Adams Mission and other vacancies
5.0
Provision for 50 critical additional posts across all Fire and Emergency Unit.
10.0
Provision for 40 learnership posts in the Fire Department
2.0
Provision for vacancies: improving turnaround time (building plans)
4.0
Advertising for staff vacancies
5.1
Additional security services at one-stop-shops for Regional Centres
6.2
Hire of community co-operatives for cleaning services
2.6
Recruitment of additional forensic investigators
2.0
Trainee Accountant / Graduate Accountant Programme: skilled staff
6.0
Filling of technical / skilled posts in Electricity Unit
40.0
I. T. staff vacancies
8.0
Skills Development Unit staff vacancies
5.0
Other critical vacancies and new posts
21.0
SUPPORTING OUR COMMUNITIES
The following are selected highlights from the departmental operating budgets for 2008/2009Free Basic Electricity
Our Indigent Policy enables us to provide free 50 kwh of electricity to those customers who
consume less than 130 kwh per month. We adopted a self-targeted approach whereby customers
who believe themselves to be indigent can apply, provided their average past 6-month
consumption is below the 150 kwh threshold.
Zibambele Poverty Alleviation
The Council ensures the empowerment of people in the community by providing small municipal
contracts for grass-cutting, verge clearance, etc. There is also a platform that the Council operates
for small co-operatives, providing administrative assistance, along with guidance on business
issues.
Refuse Removal
We have extended provision of the service to newly-incorporated areas by using community-based
contractors.
Rehabilitation of Landfill Sites
Planning and development of regional landfill sites continue to demand a substantial investment
by the Municipality to ensure that waste is appropriately disposed off.
Critical Staff Vacancies
We have provided for R300 million for new employees with related operations, including critical
staff (R80m). This is to increase our service delivery to the public. Security staff is a large
proportion of this total.
Soup Kitchens
This is one of our poverty-alleviation programmes. We provide free meals to the poor. We are
currently servicing 18 sites.
Interest on Loans
The interest is paid on an additional DBSA loan of R950 million.
Harbour Widening
This includes a portion of the cost for the demolition of the old sub-aqueous tunnel.
PROJECT / ITEM
R’ m
Provision of free basic electricity: indigent customers:
16.7
Zibambele poverty alleviation project for roads and verge maintenance:
51.9
Refuse removal service to cover 100% of City:
20.0
Rehabilitation of landfill sites:
14.9
Provision for critical staff vacancies:
80.0
Eighteen operational soup kitchens: (11000 indigents):
6.5
Interest on loans : Additional DBSA loans:
35.0
Demolition of old tunnel: harbour entrance widening:
21.0
Special events (including 2010 preparation):
15.9
Maintenance of IT network structure:
17.0
Repairs and maintenance:
827.7
- Water: (ageing infrastructure) increases to:
246.8
- Electricity: network maintenance increases by R 71.9m to:
351.1
- Roads maintenance increases by R 47.3m to:
229.8
Special Events
We cater for a number of events annually, including local and international events.
These include all our 2010 functions. This includes your One Nations Cup, Durban
Beach Festival and Comrades Marathon, etc. Some events are hosted in partnership
with other entities, including Provincial Government and the 2010 LOC.
IT Network
This cost is for the management and maintenance of the IT infrastructure network
throughout the Municipality for the purposes of using excess capacity to provide
competitive data and voice services to the general public.
Repairs and Maintenance
Overall repairs and maintenance amounts to R 1.62 billion for the year, which
represents 10.8% of the total budget, which is above most metros in the country.
A DIVERSE RANGE OF LINE SERVICES
2005/2006
2006/2007
2007/2008
2008/2009
Full Year Forecast
Full Year Forecast
Expenditure (R)
Vote Description
Actual
Actual
Electricity
2 703 744 000
2 794 746 000
3 288 113 840
3 956 818 120
Water
1 688 119 000
1 768 259 000
1 984 397 830
2 421 443 060
Treasury
802 550 000
1 530 918 000
1 534 482 000
2 152 186 000
Engineering
672 203 000
699 620 000
890 391 305
1 105 839 720
Parks, Recreation, Cemeteries & Culture
715 662 000
715 101 000
838 188 750
1 001 776 195
Sanitation
432 826 000
418 326 000
502 246 740
612 536 860
Cleansing & Solid Waste
376 249 000
421 873 000
478 969 290
547 798 860
Metropolitan Police
346 463 000
345 846 000
418 192 620
460 721 400
eThekwini Transport Authority
172 567 000
204 180 000
304 748 380
391 029 040
Health
209 765 000
212 545 000
248 658 330
303 159 700
Housing
460 826 000
619 436 000
153 850 640
234 498 950
Emergency Services
140 883 000
145 023 000
174 141 720
215 111 500
Development Planning & Management
73 157 000
77 202 000
104 393 570
128 767 300
City Enterprises
60 243 000
46 116 000
75 250 580
87 889 360
Community Participation & Action Support
21 498 000
25 399 000
41 398 100
56 355 200
Area Based Management
40 560 000
42 189 000
58 103 470
52 466 120
Regional Centres
23 765 000
28 015 000
40 672 430
48 694 670
Economic Development & Facilitation
33 828 000
33 037 000
40 697 450
45 277 870
Business Support
22 675 000
25 189 000
30 912 396
35 933 860
Market Service
23 612 000
21 766 000
30 993 070
30 847 660
KEEPING TARIFFS REALISTIC
YEAR
RATES
WATER
ELECTRICITY
CPI
1997-1998
13.3
9.8
8.7
9.7
1998-1999
9.8
18.7
7.3
7.0
1999-2000
8.9
14.1
5.7
7.7
2000-2001
7.9
13.2
4.7
7.8
2001-2002
9.9
29.6
5.1
8.0
2002-2003
9.9
7.5
8.0
10.3
2003-2004
12.5
9.9
5.6
9.5
2004-2005
8.5
7.9
5.0
6.3
2005-2006
5.9
7.5
5.9
5.1
2006-2007
7.5
7.5
7.5
5.2
2007-2008
9.9
15.0
7.5
5.1
2008-2009
9.9
9.9
15.0
6.0
TARIFF INCREASES VERSUS CPI
30.0
RATES
25.0
20.0
WATER
15.0
10.0
ELECTRICITY
5.0
97
19 -19
98 98
19 -19
99 99
20 -20
00 00
20 -20
01 01
20 -20
02 02
20 -20
03 03
20 -20
04 04
20 -20
05 05
20 -20
06 06
20 -20
07 07
20 -20
08 08
-2
00
9
0.0
19
INCREASES (%)
35.0
FINANCIAL YEARS
CPI
• In the light of the significant challenges in the roll
out of basic services to all our citizens, tariff
increases have been moderately above inflation.
• The spikes in water supply tariff increases are
attributed to a high water loss and increases
from our bulk water supplier
• The significant increase in electricity expected in
2008/2009 includes a 3% surcharge to cover the
shortfall attributable to load-shedding.
• As a result of ongoing, fruitful negotiations with
Government departments a higher collection
rate is anticipated. Good progress has also
been made with collection of old debts (including
government departments), which is also
reflected in this projection.
• Due to a focus on government departments and
businesses that owe large amounts a higher
collection rate is anticipated.
• A programme has been put in place to
encourage water customers to pay their current
accounts in return for a reduction in the debt
they have incurred. The approach targets the
poorer section of our society that own properties
valued at or less than R100000. Due to this
programme an improved collection rate is
anticipated.
A SIGNIFICANT CAPITAL BUDGET
CAPITAL PROJECTS
 2010 Soccer World Cup
Stadium
Stadium Precinct
Transport
City Regeneration
2008/09
2009/10
2010/11
R’m
R’m
R’m
1 318.9
13.3
519.1
112.5
299.4
0.0
411.6
85.0
26.8
0.0
529.7
0.0
 Port (Freight Man)
46.7
28.1
28.7
 IT – Strategic Projects
84.9
31.5
89.2
250.0
200.0
200.0
 Western Aquaduct
 Tourism nodes development
10.9
15.5
13.3
 Town Centre Renewals
22.7
22.5
31.2
 Neighbourhood Development Partnership
74.5
133.1
172.2
1 164.9
11.2
1 250.7
40.0
1 186.9
70.0
260.5
170.5
50.5
15.1
30.0
137.5
151.3
81.3
17.1
30.0
138.7
95.5
47.8
17.5
45.0
 Safety and Security
18.5
8.0
9.0
 Public Transport Plan
22.2
24.0
24.0
439.9
142.5
64.6
237.5
427.7
20.8
47.9
65.7
148.6
29.8
107.9
483.1
178.5
39.5
248.7
520.3
38.3
54.4
57.0
130.9
11.2
105.0
253.0
224.5
83.7
304.5
550.8
30.9
67.8
67.0
158.3
11.9
89.4
Housing
Delivery
 King
Shaka
Airport Infrastructure
 Infrastructure to meet backlogs:
Water
Sanitation
Roads
Storm water
Community Projects
 Bulk Rehabilitations/Reinforcement
Water
Waste Water
Refuse Removal
Roads / Pedestrian Safety
Electricity
Stormwater
Community Facilities
Vehicle Replacement
Operations: Various Services
ABM’s
Other (Markets, Fire Stations, etc.)
TOTALS
R 4 765
R 3 583
R 3 380
FUNDING SOURCES (2008/2009)
KING TO PLACE PIE GRAPH OF
WHERE
THE MONEY COMES
FROM
CAPITAL
BUDGET
HERE.
MIG (R445.8M)
7.4%
PTIF (R492.0M)
8.2%
Equitable Share
(R314.5M) 5.2%
Other (R292.0M)
4.8%
Dept of Housing
(R816.0M) 13.5%
2010 Stadium,
National Treasury,
KZN, Council
(R1318.9M) 21.9%
Council (R2350.5M)
39.0%
TOTAL DRAFT CAPITAL FUNDING R5. 9297 BILLION
Did you know that…
We have the largest capital budget spend of any
municipality in South Africa.
• We ensure communities become and remain sustainable
in terms of livelihood is becoming one of the greatest
challenges for the municipality. It is clear that sufficient
resources are not available to eliminate all backlogs at the
current service levels. Without additional sources of
revenue, the Municipality had to consider alternative
options. Various alternative funding options are being
considered for inclusion in the Long Term Financial
Strategy. Borrowings of R 950 million will be made during
the year in order to accelerate the capital program, in an
attempt to eliminate the backlogs.
• The projected capital expenditure budget for the
2008/2009 financial year period is R 5.93 billion (2007/08:
R 4.20 billion ) which is a growth of 41.2 % on that of the
previous year.
MANAGING LEGISLATIVE CHANGE
Section 3(1) of the Local Government Municipal Property Rates Act, 2004 (Act 6 of 2004) and section 62 (1)(f) of the MFMA determines that a municipality must
adopt and implement a rates policy on the levying of rates on rateable properties. The new rates policy was approved by Council on the 11 February 2008 and
complies with the Municipal Property Rates Act. Thus, the levying of rates will have an impact on the rates individual property owners will pay with effect from 1
July 2008. As properties are now being assessed based on the market value there is a shift in incidence. The cent in the rand (randage) has been adjusted
downward to compensate for the higher values. In addition, the impact on the indigent, pensioners, disability grantees and lower and middle-income ratepayers
was considered to ensure a limited impact. Revenue neutrality has been maintained using existing income per category of property as a base to calculate the rate
randage for the new year. The rating of property based on market value has resulted in a minimal shift in incidence between the different categories of property.
State property is now rated in accordance with usage resulting in a shift to other property categories particularly business, commercial, as well as vacant land.
Category of Properties
Agricultural
Number of
Properties
New Property
Value
Old Property
Value
ANALYSIS OF VALUATION ROLL
% Increase
705
1 783 527 000
364 088 000
389.86%
15 549
65 554 951 000
22 593 037 300
190.16%
Exempt (e.g. Religious Bodies, etc.)
1 240
3 711 674 000
822 258 500
351.40%
Industrial
4 018
30 578 887 000
12 281 345 400
148.99%
11 083
6 410 968 000
49 435 800
12 868.27%
415 483
234 660 282 000
49 091 833 250
378.00%
54 300
21 974 175 000
2 417 713 243
808.88%
502 378
364 674 464 000
87 619 711 493
316.20%
Business & Commercial
PSI
Residential
Vacant Land
Totals / Average
Residential
Business and
Commercial
Total number of properties is
415469.
Approximately
108971
(26%)
of
residential
properties are valued at
under R120000 and will pay
no rates.
227870 (55%) of properties
will see a reduction in rates.
About 16% of residential
property have a value higher
than R1 million.
No rates payable in respect
of
properties
valued
R400000
or
less
for
pensioners,
disability
grantees,
child-headed
households
and
the
medically boarded.
Total
number
of
properties: 15549.
About 5814 (37%)
properties will have a
reduction in rates.
Industrial
Total
of
4018
properties.
Nearly 2424 (60%)
properties will see a
reduction in rates.
Vacant Land
Total
number
of
properties is 54300.
All vacant land will
receive
the
first
R30000 of value as a
reduction for rates.
Nearly 18620 (34%)
of properties will pay
less for rates.
A GOOD FINANCIAL RECORD
* FINANCIAL STATISTICS 2007/2008
METRO
TOTAL
INCOME
(Rm)
DAYS
CASH ON
HAND
NET
CAPEX:
TOTAL
INCOME
(RATIO)
* MONTHLY BILLING VERSUS PAYMENTS 2007/2008
TOTAL
DEBT :
INCOME
(RATIO)
NET DEBT :
INCOME
(RATIO)
METRO
ETHEKWINI / DURBAN
CAPE TOWN
9 394.8
78.6
15.6
25.1
3.2
EKURHULENI
8 470.3
144.7
9.0
15.9
(16.4)
ETHEKWINI / DURBAN
11 539.1
143.1
20.1
39.7
8.0
JOHANNESBURG
14 088.8
69.0
19.4
41.8
25.1
NELSON MANDELA
2 962.4
169.7
17.5
14.8
(32.3)
TSHWANE
8 067.4
60.1
19.4
34.5
20.4
N/A
102.3
17.2
31.9
7.4
WEIGHTED AVERAGE
* DEBT & LIQUIDITY 2007/2008
METRO
S/TERM
DEBT
(Rm)
L/TERM
DEBT
(Rm)
TOTAL
DEBT
(Rm)
CASH
HOLDINGS
(Rm)
CASH
COVERAGE
(TOTAL DEBT)
CAPE TOWN
137.5
2 217.2
2 354.7
2 054.5
0.9
EKURHULENI
52.8
1 295.5
1 348.3
2 737.9
2.0
ETHEKWINI / DURBAN
236.6
4 345.1
4 581.6
3 657.7
0.8
JOHANNESBURG
113.6
5 770.5
5 884.1
2 354.3
0.4
26.4
413.3
439.6
1 396.0
3.2
TSHWANE
105.0
2 680.3
2 785.4
1 136.2
0.4
TOTAL
671.9
16 721.9
17 393.7
13 336.6
0.8
NELSON MANDELA
* NOTE: MUNICIPALITIES MAY DIFFER IN THE METHOD USED TO DETERMINE
KEY STATISTICS.
05/06
(%)
93
06/07
(%)
96
07/08
(%)
96
Despite the increase in debtors, the payment/cash
collection rates have increased. The debtor
increase is due to interest charges and penalties
from historical debt and higher levels of poverty.
The Municipality has yet again managed to maintain its
excellent credit rating of A1+ (short-term) and AA (long-term)
for the third year in succession, as published by the Global
Credit Ratings Company. These short and long- term ratings
are amongst the highest ratings accorded to local authorities
in South Africa and naturally it will provide the Municipality
with a sound financial platform to meet its economic
challenges and service delivery targets.
The factors influencing the strong credit ratings are as
follows: • The significant progress that we have made since
transforming into a metropolitan municipality, supported by
the Municipality’s experience and capable management
team, and the prudent judgment displayed by the political
leadership.
• The substantial and increasing level of spending by Council
on the World Cup related and socio-economic projects, and
the associated longer term benefits thereof.
• The Municipality continues to display a robust financial
profile, characterised by strong cash generation and high
liquidity levels.
• Key debtors ratios have remained fairly stable in recent
years, while collection levels have improved.
COMPARING WITH OUR COUNTERPARTS
The following tables give a comparable indication of residential tariffs between the various metros for 2008/2009: Service
eThekwini / Durban
Cape Town
Johannesburg
Tshwane
Nelson Mandela
Ekurhuleni
Water
• Increased by 9.9%.
• 6kl free.
• No fixed charge for
property < R190K.
• Increased by 9.2%.
• 6kl free.
• Increases unavailable.
• 6kl free.
• 4 rising block tariffs.
• Increased by 8.0%.
• 6kl free.
• 4 rising block tariffs.
• Increased by 6.0%.
• Increased by 6.3%.
• 6kl free.
• 4 rising block tariffs.
Electricity
• Increased by 12.0% +
3.0% surcharge.
• Consumption based.
• One tariff.
• The first 50kwh of
electricity is free to
residents using less
than 150kwh per
month.
• Increased by 15.0%.
• Consumption based.
• Fixed charge + 1
tariff.
• Increases unavailable.
• Consumption based.
• Fixed charge + 2
tariffs high/low
season.
• Increased by 12.0%.
• Consumption based.
• One tariff.
• Increased by 12.0%.
• Increased by 12.2%.
• Consumption based +
2 tariffs for high/low
season.
Rates
• Increased by 9.9%.
• On market value of
property.
• No rates on first R120K
of all properties.
• Increased by 7.3%.
• Only market values
of properties.
• No rates on first
R80K of all
properties.
• Increases unavailable.
• No lifeline for rates.
• No rates on first R15K
of all properties.
• Increased by 8.0%.
• No rates on first R10K
of all properties.
• Increased by 8.5%.
• Increased by 3.0%.
• On land only.
• No rates if below the
indigent limit &
rebates based on
earnings.
Refuse
• Increased by 9.9%.
• Included as part of
rates randage.
• Increases unavailable.
• Based on property
size.
• Rising block tariff as
size increases.
• Increased by 8.0%.
• Based on container
size and removal
frequency.
• Increased by 6.0%.
• Increased by 8.0%.
• Fixed charge.
• Increases unavailable.
• Based on kl water
used.
• < 6kl no charge then
rising block tariff.
• Increased by 8.0%.
• Based on kl water
used.
• Increased by 6.0%.
• Increased by 7.5%.
• < 6kl: no charge then
there is a rising block
tariff system.
Sewerage
Average
Weighted
Increase
• Increased by 9.9%.
• Included as part of
rates randage.
10.9%
• Increased by 7.5%.
Based on container
size.
• Rebate % based on
property value
<R50K to R125K.
• Increased by 6.0%.
• Based on kl water
used.
12.0%
N/A
9.0%
9.3%
7.4%
WE PROVIDE A COMPARABLE BASKET OF SERVICES WITH OTHER CITIES
UNQUALIFIED FINANCIAL STATEMENTS
DETAIL (In millions of Rands)
2007
2006
TOTAL REVENUE
12 004
10 403
TOTAL EXPENDITURE
10 874
9 601
1 130
802
SURPLUS FOR THE YEAR BEFORE TRANSFERS
ACCUMULATED FUNDS & RESERVES
NET CASH & CASH RESOURCES
(Bank, Cash & Call Deposits)
TOTAL ASSETS
CONSUMER DEBTORS
ASSETS/LIABILITIES
10 084
8 954
275
641
21 999
20 168
1 773
1 732
2007
R’m
2006
R’m
Assets
SNAPSHOT: 2007/2008
Assets: Property, Plant
& Equipment
Acquisitions of R4.2 billion.
Depreciation of R1.1 billion.
Consumer Debtors
Static over the last two
years. R41m increase
between 2006 and 2007.
Long-Term Borrowings
Borrowed R950 million at
8.3 % fixed for 20 years.
Consumer Debtors
Collection Rates: 95%.
RATIOS AND BENCHMARKS
•Assets/Liabilities Ratio: 1.8/1.0
Favourable and stable from previous year.
–Cash and Short-Term Investments
–Property,Plant & Equipment
–Consumer Debtors
–Investments
–Other
Total Assets
Liabilities
–Long-Term Liabilities
–Creditors
–Unspent Conditional Grants
–Other
2 062
11 613
1 773
3 749
2 802
3 261
10 292
1 732
2 601
2 282
•Current Ratio: 1.4/1.0
21 999
20 168
•Gearing Ratio 1.4/1.0
BENCHMARK: 1.0:1.0
Favourable and has improved from previous year.
BENCHMARK: 2.0:1.0
Favourable and has increased from previous year.
4 345
3 391
131
4 048
3 738
2 827
101
4 547
Total Liabilities
11 915
11 213
Net Assets
10 084
8 955
BENCHMARK: 1.0:2.5
Consumer Collection Rates:
•Rates:
95.8%
•Water:
92.8%
•Electricity:
98.0%
STIMULATING THE LOCAL ECONOMY
From 2004 to 2005, uShaka was instrumental in catalysing
the growth of stagnant housing prices in the Point area,
which was experiencing spiralling urban decay. Because
of the Municipality’s intervention, growth in the area
exceeded the national housing price index. In a period of
two years, increases of 200% was achieved in the area.
uShaka has catalysed further growth in the area,
specifically the sweeping development of the Point
Waterfront, Canal System and the Small Craft Harbour.
Because of municipal intervention, an area that was once
in a state of decay, has now become an integrated
residential, recreational, tourist and soon-to-be shopping
destination. Over and above these sweeping positive
effects, uShaka continues to receive international
accolades for its truly innovative design and world-class
facilities. Employing approximately 750 staff (including the
South Association for Marine and Biological Research) ,
uShaka MARINE WORLD achieved 90% of its budgeted
footfall into the paid environment in its first year at 1.2
million guests and 3.8 million guests into the whole park.
On 19 September 2007 the controlling shareholder,
eThekwini Municipality, invested a further R157m into the
theme park for which 1617 shares will be issued. These
funds were used to settle the outstanding capital loans
with Citibank (R88m as of 30 June 2007) and the
Development Bank of Southern Africa.
The Durban ICC continues to be foremost convention
centre in Africa. Durban certainly set the trend, as other
cities in the country and the continent at large, began to
construct their own centres. Further to this, the Durban
ICC ranks in the Top Ten in the world, having brought a
number of delegates to Durban through its hosting of
seminars, conventions and other functions. Effectively,
the ICC has paid for its construction and its operating
costs many times over through its multifarious effects on
the local economy through spurring secondary tourism.
Beyond just municipal coffers in terms of increased
revenues, local hotels, restaurants and other touristrelated infrastructure have seen significant growth in
turnover that can be indirectly attributable to the ICC.
Effectively, it is a key marketing tool in the City, that
places us on the global map. As with any infrastructure,
evolution is key to maintaining the superiority of its
product. Concomitantly, the ICC has nearly completed its
expansion. It has effectively doubled its convention space,
and can also be used as an indoor sporting facility as well
as a venue for musical concerts on a larger scale. The
total economic impact flowing from the ICC business for
the financial year was R565.5m. Based on a multiplier of
4, which is the commonly used factor in the meetings
industry, the total economic impact of the business
generated by the ICC equates to R1.068billion. This
effectively means that the contribution of the Centre to the
GDP of the KZN province is almost 1% (0.58%). Foreign
exchange earnings to the tune of R81million and a total
direct spend estimated at R267million were generated
from conference delegates. Overall financial performance
for the year was better than budget, with total revenue at
R73.3m against a budget target of R54.9m. This was
largely driven off business levels for the first and second
quarters of the financial year. The Municipality contributed
R22m in the 2007/2008 financial year to the ICC.
This project has unlocked more than 160 ha of low yielding
sugar cane land, enhancing the concept of the activity
corridor as a business activity node. It has effectively
brought the workplace closer to the workforce. It has
promoted spatial efficiency with regard to KwaMashu,
Inanda & Ntuzuma and unlocked the development node of
Phoenix. The industrial usage of the area has higher
economic benefit than agricultural use and has had a
positive effect on land values of the surrounding areas. The
project created some 3500 jobs during the construction
phase and some 13500 new jobs post development is
expected in the long-term.
READINESS FOR 2010
The new Moses Mabhida stadium will be a world-class
facility.
Most prominent feature of the new stadium, to be built
on the site of the existing football stadium, will be the
30-storey arch stretching its entire length.
Stadium will be built on the site of the existing King's
Park stadium and has been designed as a first-class
multi-purpose sporting facility.
The 100m high arches will mark the centre of Durban's
growing Sports City Complex.
Stadium will have a seating capacity for 70000 people.
Arches will have a cable-car erected.
Stadium will cover 320 x 280 square metres and will
be 45m in height.
Parking for 10000 cars.
COST IMPLICATIONS
 Will have a major impact on spending for the Municipality.
 Total cost of stadium: R2.6 billion.
National Government: R 1.8 billion.
Provincial Government: R 0.3 billion.
eThekwini:
R 0.5 billion.
 Financial impact of related infrastructure: R4.0 billion. (Still under
discussion with FIFA LOC and National Treasury.)
Stadium Funding Infrastructure
Transport.
ICT.
Upgrading / Improvements.
Operating costs.
MEASURING THE ECONOMY
Measure
2006
Gross Value Added (GVA)
R115.7 billion
Gross Domestic Product
R126.6 billion
Gini Coefficient
Per Capita Income
GVA Average Annual Growth
Population
1 437 persons/ km2
Employment Rate:
64.5%
Unemployment Rate:
35.5%
R13.2 billion
R4.2 billion
18 500
Number of Households:
914 198
Number of People in Poverty: < $2 per day
397 073
% of People in Poverty:
12.0%
Urbanisation Rate:
91.4%
Annual Total Disposable Income:
Annual Household Expenditure:
Construction
3%
20%
Wholesale and retail trade
3%
Transport, storage and
communication
18%
16%
Financial, insurance, real estate
and business services
Community, social and personal
services
0.68
86.2%
Municipal Staff Employed: 2006
Manufacturing
Electricity, gas and w ater supply
2 297km2
Urban Population
Capital Budget: 2007/2008
23%
3 299 788
0.6%
Operating Budget: 2007/2008
Mining and quarrying
5.2%
Population Growth (2005-2006)
Human Development Index
0%
R34 392
27%
21%
32%
20%
Population Density
16%
0.60
Age Structure:
00-14
15-24
25-44
45+
Geographic Area
Agriculture, hunting, forestry and
fishing
1%
R73 791
R113.7 billion
Annual Retail Sales:
R36.4 billion
Total Exports:
R31.3 billion
Total Imports:
R48.3 billion
The local economy is affected by the performance of the national economy, although recent indicators
suggest it is outperforming the national one in terms of the Gini Coefficient, unemployment rate and the
Gross Domestic Product. The national economy continued to enjoy growth of around 4.7% during 2006 and
is starting to reap the benefits of sustained sound macroeconomic management and structural reforms.
In addition to achieving the Accelerated and Shared Growth Initiative (ASGISA) target of 4.5% per annum,
the country has also experienced 36 quarters of uninterrupted economic growth. Presently South Africa is
ranked as the 18th most attractive destination for Foreign Direct Investment according to a recent
international survey. Massive infrastructure investment plans have been announced by both the private and
public sectors for public transport, new power plants and township renewal growth. Unemployment remains
high, but job prospects are amongst the highest in the world for the second year running, creating 200000
jobs between March 2006 and 2007.
In the first phase, between 2005 and 2009, ASGISA seeks an annual growth rate that averages 4.5% or
higher. In the second phase, between 2010 and 2014, an annual average growth rate of at least 6% of GDP
is targeted.
GDP growth in Durban has grown at an average annual rate of 3.9% over the period 1996-2006 and has
been consistently strong and lagging slightly behind Johannesburg and Cape Town. As reflected in the graph
below, the manufacturing sector in Durban is the biggest contributor to the GDP growth, followed by finance,
trade and then transport. When deconstructing the manufacturing sector in Durban, the success is due
largely to the chemical, automotive, pulp and paper, wood and wood products, and food and beverages
components. The City’s Economic Strategy acknowledges the importance of these sectors’ potential for
growth, job creation and global competitiveness, and has aligned appropriate medium-to-long-term plans for
further enhancement. The National Government’s new industrial-policy framework that re-emphasizes the
development of the country’s manufacturing sector as the cornerstone of the economy will also contribute to
this sectors growth.
The introduction of the Dube Trade Port and King Shaka International Passenger Airport, the 2010 World
Cup Soccer Competition, and the major expansion plans around the Port of Durban are the three main
projects that will act as a major catalyst to the City’s economy over the next ten years.
INVESTMENT IN THE CITY
Spinoffs from
Dube Trade
Port
Lowest cost
package of
municipal
services
Significant
opportunities
for 2010
Large pool of
skilled workers
Low cost of
industrial land
Modern IT and
Telecom
networks
Excellent
transport
infrastructure
Most important
port in Africa
Maintain a
positive
operating
cashflow,
All reserves
are cashbacked.
Finance capital
projects mainly
through
internal funds.
We have a 5point plan as
our approach in
managing the
Municipality’s
finances: -
Capital
expenditure of
(R50 Billion
in ten years)
Critical
indicators to
benchmark
our
productivity.
Business & Investment Marketing: - Other targets & channels
engaged; Products developed & distributed; Effective
budget allocation in synergy with other Units.
Existing Business Retention and Expansion: - BR&E rollout
continues; South Durban Basin (SDB) Area 1 in conclusion;
SDB Area 2 launched; Multiple Chamber partnership
projects continue; Strategic businesses & flagship
investment projects in ongoing engagement/aftercare.
Foreign Investor Support: - Leveraging targeted work with other
spheres & Agencies; several fdi engagements held; 3 large
fdi enquiries converted; 2 incubated on site; bids for more in
progress.
Business Development in R293 Townships: - Draft strategic
outline developed, but due to changes in Project Managers,
progress is slowed.
Create a Business-Friendly Environment: - Ad hoc interventions
continue on a case by case basis, but formal project outline
now completed (National Government assistance) & project
manager engaged for roll-out, but progress has slowed.
Under-Capitalised Investment Development: - 3 projects being
developed: One in multiple location aquaculture; the other a
large Umlazi Business Service Centre; the 3rd in computer
& TV assembly.
Business Investment & Targeted Incentives Strategy: - Draft
outline developed, & 1st City work shop held but due to
change in Project Manager, plus HR constraints, progress
has slowed.
AgriBusiness Forum: – PPP Forum established; Summits held;
Market Days launched; Strategy refined; Amakhosi projects
progressed; Newsletter launched; breakfast workshops
held; new staff capacity engaged.
2010 Eco-Dev & Bus. Opportunities Workstream: - Team
sourced & developed; Strategy presented & agreed;
authorised engagements held; action plan presented & in
roll-out; partnerships with chambers & other government
spheres developed; new staff capacity engaged.
CARING FOR ALL OUR CITIZENS
SERVICE
SOCIAL PACKAGE
APPROXIMATE
COST
R’M
Residential property owners are exempt from paying
rates on the first R 120 000 of their property value.
108 971
Pensioners,
child-headed
households,
disability
grantees and the medically boarded are exempt from
paying rates on the first R400000 of their property
value. (This amount is inclusive of the R120000
mentioned above.)
Assessmen
t Rates
ESTIMATED
NUMBER OF
HOUSEHOL
DS
20 258
Total Exemption in Rebates, Reduction, Properties
Valued Under R120K, etc.
855.8
129 229
Water
The first 6kl of water is free to all residents.
Households with property values at R40 000 or less do
not pay the fixed charge for water.
202.0
280 000
Electricity
The first 50kwh of electricity is free to residents using
less than 150kwh per month (Qualifying households will
have to make application for this concession).
TOTAL
Basic Service
Existing Backlog
200 000 households
Water
165 000 households
Sanitation
200 000 households
Electricity
200 000 households
Solid Waste
Nil households
Stormwater
R 143 000 000
Sidewalks, pedestrian bridges &
footpaths
58 000
1 074.8
Housing
Roads
17.0
R 2 200 000 000
R 131 000000
DESPITE OUR
SUCCESSES, THE
CHALLENGE TO
PROVIDE
EQUALITY FOR
ALL STILL EXISTS,
BUT WE ARE
DETERMINED TO
MAKE DURBAN A
LIVEABLE CITY
FOR EVERYONE.
• Ideally the City would like to deliver 20000 units annually to
deal with the housing backlog, however, due to yearly
limitations on housing subsidies this is not achievable.
Accordingly, the Municipality is in the process of developing an
Accelerated Housing Delivery Model, which would involve
securing funding from a range of sources which would inter
alia involve the major financial institutions as well as the
private sector and social housing institutions.
• The basic social package is an affirmation of the Municipality’s
commitment to push back the frontiers of poverty by providing
a social welfare to those residents who cannot afford to pay,
because of adverse social and economic realities. The social
package will also assist the municipality in meeting its
constitutional obligations. However, in order for us to continue
to deliver these services in a financially sustainable manner,
all residents will have to pay for services over and above the
free basic services provided.
• The estimated cost of the social package (i.e. income
foregone) amounts to approximately R1074.8m for the
2008/09 budget year. This is mainly funded from the R1.6
billion equitable share from national government.
PROVEN CAPABILITIES
SOME IT STATISTICS
OUR GLOBAL POSITIONING
• No. of faults processed per month:
2 500
• No. of change requests processed per month:
• No. of PC users:
• No. of daily transactions processed:
• No. of internet users
• No. of bills / inserts printed per month:
• No. of fines processed per month:
500
7 000
• Sister cities twinned with Durban: 12
• Active projects with sister cities:
39
• Incoming international delegations: 50
1 000 000
• Meetings with consular corps:
26
2 000
• CIFAL training sessions held:
2
2 000 000
A COSMOPOLITAN CITY…
WATER AND SANITATION
•11 000 km of pipelines.
•725 000 units connected.
•220 reservoirs.
•8 000 km wastewater pipes.
•27 wastewater treatment works.
•280 pumpstations.
A CITY THAT PROVIDES…
85 555
A TECHNOCRATIC CITY…
LINKING WITH THE PRIVATE SECTOR
• About R3.1 billion S.A. company new
investments/expansions thus far.
• Business Retention and Expansion (BR&E)
project roll-out in SDB Area: 2 of 3 in South
Durban Basin (950 businesses directly
assisted; 16 Action Teams launched; new
Business tools distributed).
• R1.7 billion foreign investment already
confirmed/secured thus far + another R2.5Bn
being sourced/facilitated at present.
• Full investment promotion marketing: plans
converted and products rolled out for full
Council benefit.
• Agri-Business Forum expanded & various
projects initiated. Ramping up to capitalise on
Dube TP & other flagship projects.
• Three new business development projects of
R1.7 billion being progressed.
• 2010 Eco-Dev & Bus. Opportunities Work
Stream plan confirmed, resourced & being
rolled out through partnerships.
A CITY THAT ENGAGES WITH BUSINESS…
WE ARE A COMPLEX
ORGANISATION THAT
DEALS WITH COMPOSITE
SOCIAL, TECHNICAL,
FINANCIAL AND
ECONOMIC ISSUES…
FLEET AND PLANT
•Total vehicles serviced:
2939
•Number of the targeted services: 3696
•Ratio of artisans to vehicles:.
1:103
•Average vehicle availability:
94%
•Number of vehicles licenced:
1695
•Income from hire pool:
R6.45m
•Income from disposal of vehicles: R2.3m
A CITY THAT WORKS…
LIGHTING UP THE CITY
• Major Substations
99
• Distributor Substations
631
• Mini Substations
5461
• Brick Substations
2736
• Pole Transformers
4350
• Streetlights
200 000
A CITY THAT BRIGHTENS YOUR DAY…
SOLID WASTE
• No. of tons removed and disposed:
• No. of houses serviced:
• No. of refuse bags distributed:
• No. of commercial customers:
• No. of wheeled containers & skips:
• No. of landfill sites:
• No. of transfer stations:
• No. of garden refuse sites:
• Vehicle fleet complement:
• No. of re-cycling drop-off centres:
• No. of re-cycling buy-back centres:
A CLEAN CITY…
1 418 264 tons
1.1 million
43 million
31 000
80 000
3
8
12
424
15
7
THE BUILDING-BLOCKS FOR SUCCESS
WE HAVE STRONG,
PRAGMATIC
MANAGEMENT
LEADERSHIP WITH
PROVEN EXPERTISE
IN MUNICIAL SERVICE
DELIVERY.
WE HAVE A STABLE
EXPERIENCED
ADMINISTRATION.
WE HAVE A PROPOOR FOCUS IN
TERMS OF SERVICEDELIVERY.
WE HAVE
CONSISTENTLY
APPLIED A
STRATEGIC SPLIT
BETWEEEN OUR
SOCIAL AND
ECONOMIC
EXPENDITURE.
WE HAVE ACHIEVED
CONSISTENT
UNQUALIFIED
(CLEAN) AUDIT
REPORTS.
WE HAVE THE
HIGHEST CREDITRATING AWARDED IN
THE MUNICIPAL
SECTOR.
WE HAVE A DEBTORS’
COLLECTION RATE
CONSISTENTLY
ABOVE 95%.
WE HAVE ACHIEVED
MORE THAN 95%
CAPITAL SPEND PER
ANNUM.
WE WERE THE FIRST
MUNICIPALITY IN
SOUTH AFRICA TO
ESTABLISH AN
INTERNATIONAL
CONVENTION
CENTRE.
WE HAVE REVERSED
URBAN DECAY IN
MANY AREAS IN THE
CITY.
WE RECEIVE
REVENUE &
ELECTRICITY FROM
LANDFILL SITES,
SIMULTANEOUSLY
USING SUSTAINABLE
DEVELOPMENT
METHODOLOGIES.
WE HAVE A
STRATEGIC
PARTNERSHIP WITH
THE PORT TO
INCREASE
EFFICIENCIES IN THE
HARBOUR AREA.
A METRO THAT IS OPEN TO DISCUSSION
GENERAL
DETAIL
General Council Number
031-311 1111
Treasury
031-311 1131
Website
www.durban.org.za
Core Hours of Business
09h00 – 12h00
13h00 – 16h00
Call us for discussions / advice on: -
•Investor Services
•Business Support.
•Economic Services.
•Logistics Information.
•Land Acquisition.
•Infrastructure Provision.
OUR COMMITMENT TO YOU: WE WILL RESOLVE EVERY
QUERY FROM THE PUBLIC AND BUSINESSES