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MLM presents new budget figures - Outlook is bleak


1 June 2021

Breyten, Sheepmoor, Lothair, Davel and Chrissiesmeer all showed a payment rate of 1%, which translates to virtual non-payment from these residents.

On Friday, 28 May 2021, the executive mayor, Cllr. Mkhaliphi, presented the Integrated Development Plan (IDP) budget. While presenting the draft of the multi-year budget for 2021/2024. The budget layout was met with resistance from the Economic Freedom Fighters (EFF), as well as the Democratic Alliance (DA), who did not accept the budget. The African National Congress (ANC) deemed the budget to be acceptable, and the draft was approved. Concerns raised by the opposing parties included the issue of service delivery and the lack thereof, the Eskom bill, the issues faced on a daily basis with provision of electricity, the lack of maintenance of roads and infrastructure, and a myriad of other issues. According to the presentation, the lack of payment from residents negatively impact the service delivery efficiency from Msukaligwa Local Municipality (MLM).

MLM stated that a loss of 40% in electricity distribution is lost due to illegal connections, and 42% loss of water is due to the aged infrastructure and unmetered stands. MLM also stated that the COVID-19 pandemic has had a negative impact on all operations across the board. It was also noted that bulk purchases for water and electricity, contracted services and salary cost, plus payment of creditors exceed the cash income that is not fully collected, and higher than the collection rate of 66 %. Interest for non-payment of creditors due to poor cash flow also has a great impact on the budget. According to the budget layout, bulk electricity and water cost is 35 % of the total operating expenditure budget, salaries takes 26 % of the total operating expenditure, but at a cost of 33% of the current cash flow, and between Eskom, Department of Water and Sanitation (DWS) and salaries, the cash budget is 99% of the available funds. According to a new valuation roll to be implemented from 1 July 2021, and property market values that could increase between 20-50%, the council will implement a 4% tariff increase, and that all properties of which is not indigent registered owners will now pay full property rates.

All electricity services will be increased by 16%. Property rates increase will be 4%, on top of increased market value. Water services will see an increase of 6%, as will sewerage services, refuse services and all sundry tariffs. According to the budget layout, a mere 34% payment rate is noted in Ermelo. Wesselton has a measly 8% payment rate. Shockingly, Breyten, Sheepmoor, Lothair, Davel and Chrissiesmeer all showed a payment rate of 1%, which translates to virtual non-payment from these residents. Warburton has a 7% payment rate, with Departmental payment rates sitting at a poor 6%. In total, a payment rate of 64% is noted within MLM’s governance. The Tribune ePaper will communicate with Mandla Zwane, municipal spokesperson, to nail down finer details of the budget, which will be published in next week’s ePaper. Issues raised will include the infamous 88kVA issue, the collapsing sewerage network, the shoddy state of the roads and more.

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