DA won’t back pro-poor budget

Prudent financial management in Ekurhuleni not a priority, says party

ALTHOUGH Ekurhuleni’s 2017/18 budget announced yesterday was “reasonably propoor”, the DA will not be supporting it due to the city’s failure to administer “prudent financial management”.

This was the view of DA councillor Simon Lapping, who told The Star that this year’s budget seemed pro-poor because of the R6.4 billion capital expenditure allocation but would not be properly implemented due to the city’s poor planning.

“Many capita projects have been carried over for years and this will continue,” Lapping said.

“Judging by the previous third quarter performance of Ekurhuleni, only 46% of the capital budget had been spent,” he added.

“It is clear to the DA that prudent financial management is not a high priority. We in the DA will not be supporting the budget,” he asserted.

Member of the mayoral committee for finance and economic development Doctor Xhakaza said in his speech, delivered at the Ke-Ditselana Village in Katlehong, that the city was on a quest “to accelerate service delivery and improve the standard of living in the region”, and had “increased the capital budget to R6.4bn for 2017/18, a 23% leap from the 2016/17 adjusted budget which totalled R5.1bn.

“We have also set aside a record R20bn capital budget over the next three years,” Xhakaza added.

Regarding tariff increases, water increased by 10%, sanitation by 9%, refuse removal by 7.5% and electricity by 1.88%.

This was a sharp drop in electricity increases compared with the previous two financial years – 2015/16 and 2016/17 – which recorded increases of 12.2% and 9.4% respectively.

Xhakaza said in his speech that the “decline in electricity demand over the past three years resulted in a zero growth of revenue in the following budget year”.

Asked by The Star how the city would mitigate against the loss in electricity revenue, spokesperson Themba Gadebe said: “Ekurhuleni has initiated illegal connection blitzes to minimise revenue losses.

“We are completing a programme to audit large business and this will be taken to small businesses and residents.”

Gadebe added: “We will also be auditing prepaid electricity meters.”

Xhakaza also announced a bullish drive to promote small business development through the city’s procurement processes by allocating R12bn of “procurement opportunities” over the next three years to local entrepreneurs.

Of this, an allocation of R3.5bn was made available in the 2017/18 financial year. This included:

● R1bn (per annum) for 2 000 youth-owned enterprises;

● R500m (per annum) for 100 emerging construction companies;

● R500m for black industrialists;

● R500m for community trade in service; and

● R112m for community-based planning.

“Our people will also be excited to know that we have already amended our supply chain management policy to ensure that a minimum of 30% of our procurement expenditure is reinvested in local communities,” Xhakaza enthused.

However, Lapping poured cold water on the MMC’s ambitious plans.

He said: “Due to the large volume of corruption and fraud… it is clear the ANC cadres are here for a feeding frenzy.

“It is clear from past experience that this budget will not be fulfilled.”