EMLM council adopts 2023/2024 Draft IDP Budget
Groblersdal
The council of Elias Motsoaledi Local Municipality (EMLM) has passed its 2023/2024 Draft Integrated Development Plan (IDP) Budget, tabled by Mayor Cllr David Tladi at the municipal chamber in Groblersdal on Wednesday 31 May 2023. The adopted IDP will be effective from July 2023.
Addressing a council sitting, Tladi said: “To this end, municipalities are required to plan and facilitate development in an integrated manner, ensuring that resources are utilised efficiently and effectively to alleviate poverty and inequality, provide basic services and promote sustainable development.”
He said the IDP is guided by the Municipal Systems Act (MSA), which outlines the objectives and procedures for integrated planning for municipalities, aligned with Section 23 (1) of the Act, stating that every municipality must undertake developmentally-orientated planning.
Tladi outlined that the total operating revenue budget for the local municipality amounts to R749 million, with an operating expenditure budget amounting to R580 million resulting with the operating surplus of R169 million.
“The operating expenditure budget represents 87 percent of the total expenditure budget and the capital budget on the other hand represents 13 percent of the total expenditure budget. The 2023/2024 total expenditure budget is one per cent less than the 2022/2023. The decrease is mainly due to decrease in Division of Revenue Act (DoRA) allocation in 2023/2024 financial year and a decrease in internally funded projects due to unhealthy municipal financial position,” explained Tladi.
In terms of revenue generation assumptions, Tladi said total grants allocated to the municipality in terms of the 2023/2024 Division of Revenue Bill amounts to R444 million over the medium-term, reflecting an increase of R25 million (5.97%), over the 2022/2023 DoRA allocation.
He said the operating revenue budget for 2023/2024 amount to R749 million, which reflect an increase of R121 million over the 2022/2023 operating revenue budget, which is tantamount to an increase of 19.27 per cent. The audited operating revenue amounts to R562 million for 2021/22.
Tladi indicated that tariff and rates will increase at Consumer Price Inflation CPI rate over the long term, to fund their budget needs and to make provision for inflationary increases in goods and services required.
“As the Energy Regulator (NERSA) has approved an 18.65 percent tariff increase starting from April 2023 and this figure accounts for a 9.05 per cent increase in 2023/24, Elias Motsoaledi Local Municipality tariff will increase by 5.3 per cent as NERSA haven’t issued municipal tariff increase as yet. And the tariff will be implemented accordingly, however after the issuance of tariff increase by NERSA before 30 May 2023, municipality will reassess the increase. The 5.3 per cent increase is calculated taking into account the affordability of the community, we serve,” he said.
Tladi emphasized that the local municipality do need to adjust the tariffs in a reasonable manner and to collect outstanding debt to increase their collection rate.
“Property rates tariff will increase in 2023/2024 by 5.3 percent, which is in line with CPI,” he said.
In terms of operating expenditure guidelines, Tladi said the total operating expenditure budget for 2023/2024 amount to R580 million, reflecting the increase of R15 million over the 2022/2023 budget year, which is equivalent to an increase of 3 percent.
“The employee’s remuneration cost, bulk purchases and contracted services amounts to R182 million, R112 million and R73 million respectively, which represent 63 percent of a total operating expenditure. The audited operating expenditure amounts to R524 million for 2021/22,” explained Tladi.
He said the total capital expenditure for 2023/2024 amount to R86 million, reflecting a decrease of R19 million over the 2022/2023 adjusted budget, with the difference in capital budget for the two financial years is mainly due to a decrease in internally funded project and Integrated National Electrification Grant as per DoRA.
Tladi stated that the 2023/2024 capital expenditure will be funded mainly from capital conditional grants allocation and internally generated funds as follows, R65 million Municipal Infrastructure Grant (MIG) specifically for roads projects, R14 million Integrated National Electrification Programme (INEP) for electricity reticulation and R6 million internally generated funds.
