Overstrand Mayor unveils 2024-25 budget: Focus on service delivery amid rising costs and tariffs

“In compiling the annual budget it is of the utmost importance that we maintain a position to ensure effective service delivery and protect the financial stability of the municipality, as these are crucial for the attraction of investment to our area.”

So said the Mayor of the Overstrand, Dr Annelie Rabie, at the meeting where the Over­strand Municipality’s (OM) budget and tariffs for the 2024-’25 financial year, starting 1 July, were approved by the council on 31 May.

In a press release from the OM, the Municipal Manager, Dean O’ Neill, stated the total operational expenditure budget amounted to R1,944 billion, which “includes non-cash aspects such as depreciation. The total revenue budget amounts to R1,837 billion (excluding capital grants received).

“Hence an accounting deficit of R106,9 million is now reflected after the final revision.”

Basic services

According to O’Neill property rates and service charges have increased by between 6% and 11%. “This, despite an increasingly challenging environment.” He further stated the following had to be taken into account where tariff increases were above inflation: . Operational costs for both sewerage services and refuse services were severely impacted by fuel price hikes and strict regulatory compliance where tanker services and refuse trucks are part and parcel of rendering a service.. A consequence of load shedding is the impact on increased operational costs for municipal services, such as additional fuel costs to run generators during load shedding at bulk sewer works across the Overstrand.

Funded projects

R184,6 million has been appropriated for the capital budget of the municipality.

The larger projects to be funded by the capital budget according to O’ Neill are: . Electrification of low-cost housing areas (R22,3m);. Low-cost housing services (R13,1m);. The upgrade of pump stations and rising mains (R11m); . The Kleinmond Wastewater Treatment Works Refurbishment upgrade (R10,7 m);. The Hawston Sports Complex (R9,9m).

At the meeting the Mayor made it clear the OM had done everything in its power to get the community involved in the 2024-’25 Integrated Development Plan (IDP).

“We have invited our communities and stakeholders after the tabling of the draft budget towards the end of March to participate in the IDP review and proposed amendment and in the budget process.

“We have also attended public meetings for all wards during the public participation process in April, where more information was shared with our communities, inclusive of the opportunity to take questions and discuss issues raised by community members.”

Rabie emphasised a draft budget was tabled for inputs from residents and relevant stakeholders. “These are considered with the final IDP review and amendment and the budget for final approval by Council before the end of May.” The closing date for comments was 3 May. She stated the administration had received a revised Ward 13 (Onrus/Vermont) priority list for inclusion in the final IDP review of 31 May 2024, and the Budget Steering Committee also considered more than 170 comments from the community and other stakeholders.

“Inputs received largely represent comment regarding the baboon management programme and the lapse of the assignment of the function for baboon management from the Provincial Government at the end of 2024.”

She also made it clear the municipality would have ideally preferred costs for rendering of services not increasing by more than the inflationary rates. However, a few realities need to be considered such as drastic fluctuations in fuel prices, load shedding and substantially higher than inflation Eskom tariff increases.

Salary increases

In the budget of R1,837 billion a provision of R600,2m is made for employee related costs and the remuneration of councillors. “This is 30,86% of the total operating expenditure and is within the National Treasury norm of 25-40%,” Rabie said. “The proposed increase in the salary budget is 5,7% and notch increases, which average 2% have also been budgeted for.

“Staff vacancies are still frozen and may only be filled following a motivation to the Municipal Manager.”

The revised organisational structure was considered and approved by council during the past few months, with the implementation phase now in process.

Increases

“The draft Medium Term Revenue and Expenditure Framework (MTREF) draft budget for 2024-’25, provides for tariff increases for the respective municipal services ranging between 6% and 11%,” Rabie said.