The Map16 Mayor, supported by the ANC, Dikwankwetla, ACM, VF+, and other smaller parties supported a budget that increases electricity tariffs by 15.1%, property rates by 7%, and other services by 6%.
The DA rejected the budget as it included no clear commitment to reliable service delivery.
The budget forecasts operating revenue of R1 969 million. The bulk of this is planned to come from operational grants of R810m, electricity revenue of R508m, and property rates income of R128m. The electricity income is highly unlikely as the figure for the current financial year is unlikely to reach R120m.
The budgeted expenditure is R2 190 m. Budget assumptions indicate that the bulk of this will be spent on salaries of R776m, and electricity bulk purchases of R566m.
The most obvious example of the ‘hope for the best’ budget is the supply of electricity. The Map16 Mayor Mokotso asserted that negotiations were continuing with Eskom on the Distribution Agency Agreement (DAA), whilst a reply from the MEC for COGTA Hon K Makume to the DA in the Free State Legislature concedes that the DAA is delayed as the municipality explores other options.
It is quite obvious that the municipality will continue not to pay even the Eskom current account.
The Council’s lack of appreciation of financial management principles is evident in the fact that a week before the end of the financial year all political parties (except the DA) were prepared to pass an adjustment budget that would, at a stroke of a pen, legitimise all previously unbudgeted expenditure without any scrutiny at all.
The budget would not have passed were it not for the support of the ANC. After soundly criticising the budget, the ANC decided to pass it as they stated that they were afraid that they might lose their jobs if Council were dissolved, should the budget not be passed.
The DA will write to the Provincial and National Treasury and demand that the municipality be put under administration Section 139(7). We will also question why Council should not be dissolved if the bulk of councillors recognise the inadequacy of the budget but are driven solely by their own personal interests.
This budget is just another ‘let’s eat budget’ designed to keep politically connected friends and families in cushy jobs whilst businesses close through lack of the most basic of services, and ordinary consumers battle the cost-of-living crisis.