Remarks by the Mayor of KwaDukuza at the occasion of the Special Adjustment Budget for the 2023-2024 Financial Year at the KwaDukuza Town Hall on 30 November 2023

Ladies and gentlemen, I greet you all on this beautiful morning to deliver the first special adjustment budget for the current financial year; to solicit your approval of the proposed adjustments in accordance with Section 28, Sub-section 4 of the MFMA.

Critically, this budget is being presented just two days before the Ethiopian Emperor Haile Selassie was named. It was on 02 November 1930 when Selassie was crowned as Emperor, he went on to become the first OAU 60 years ago.

Referred to as the Lion of Judah by the Rastafarians - Selassie believed in African unity, and we learned these and more through his words when he was installed as the OAU chairperson in 1963, using his words, “History teaches us that unity is strength, and cautions us to submerge and overcome our differences in the quest for common goals, to strive, with all our combined strength, for the path to true African brotherhood and unity”.

 

In my 2023/24 budget presentation on 01 June 2023, I used Selassie as an example that we all ought to follow as African leaders in promoting our cultural diversity, to improve the living conditions of the poor, to overcome economic hardships, to sustain cooperation and unity of action.

 

Pan-Africanism that is exemplified by Selassie was to enable the continent and its people to thrive in unity and action towards the promotion of common freedoms and for the realisation of African destiny as declared in the OAU Charter that was adopted 60 years ago.

 

Therefore todays occasion is well aligned with my 2023/24 budget presentation where I reminded this august house about the importance of African leadership as part of commemorating the 60^th anniversary, recalling Selassie leadership since the establishment of OAU where I also mentioned that the disaster grant roll-overs were eminent.

Ladies and gentlemen, the Adjustment Budget as set out in the item before you is part of a response to our roll-over application and subsequent approvals of the allocations amongst other requests to council. 

It is in such instance that the rollovers approved by the National Treasury are the very affirmation of our commitment to our people.

It is on this note that I wish to congratulate members of council, administration and the people of KwaDukuza for this outstanding opportunity that will surely accelerate the delivery of projects in line with our procurement plans.

The rollovers will add more chapters to our disaster expenditure and we look forward to spending our conditional grants before June 2024. I therefore invite your indulgence to the adjustment that is appropriated on the submission before you.

Reprioritised Municipal Infrastructure Grant and Municipal Disaster Grants.

I must also point out that on this adjustment budget, there were no major adjustments to the original assumptions and I must remind the house that there’s a never-ending need of services.

 

Meaning, there are no new monies coming to the budget but it is with great joy to achieve such successes which is once again proving that we are head and shoulders above other municipalities in the province.

For our rollover application, council must note that the quantum of the four rollover applications were accepted in full by National Treasury.

 

Last month we received news from National Treasury that no unspent grants would need to be surrendered to the National Revenue Fund. The amount of R927.8 million is approved for the following projects:

 

·       Recovery Grant of R899.7 million for the 400 disaster projects which were submitted as part of the rollover request.

·       Response Grant of R26.8 million for the 

-       Upgrades to Mnyundwini culvert bridge in Ward 09 at R3.8 million.

-       Replacement of Hullet Bridge at R16.2 million. There were some internally funded allocations of about 10 million towards Hullet Bridge that can now be released back into our reserves.

-       Installation of new bridge Sugra and Mbozamo (Ward 17) (R3.8 million); and

-       Paying of consultant fees for construction supervision (R3 million) which has been requested by the civil business unit for the following a total of twelve disaster projects.

·       Integrated National Electrification Programme (INEP) (R1.1 million)

Substation Bulk-Lot 14 switch room in Glenhills.

 

In addition to the above adjustments to the capital budget, the Municipality has since received a Division of Revenue Amendment Bill with a downward adjustments made to the capital grant allocations of the Municipality which affects NDPG of R13,2 million and MIG at an amount of R4,1 million.

 

The Electricity business unit met with National Treasury on the 16^th November 2023, confirming that the R15,630m will be reimbursed by the December 2023. It is against this background that the R6,5m initial allocation is to be considered for the purpose of this Adjustment Budget to cater for the current commitment.

 

ELECTRICAL ENGINEERING SERVICES – In terms of the  Integrated National Electrification Programme grant business plan, R800k was to be used for the Housing Electrification Project (INEP) and R10m for New Substations. However, the business unit has spent R7,1m on Infills under the Housing Electrification Project utilising the grant funding. 

 

The INEP grant will then be budgeted for use on the Lavopierre Substation as proposed. It must be noted that although the Business Unit has confirmed that this R 7.1m Dukuza Substation budget will not be used during the 2023/2024 financial year , this will in the upcoming years reduce the cash reserves of the municipality if a grant is not sourced for the Dukuza Substation.

 

The electrical business unit will also receive funding of approximately R9,4m from Vuthela to cater for prepaid and MD meter replacement and installation of Metering Kiosks.

 

Spending on Municipal Infrastructure Grant

 

The Civil Business unit have also revised the MIG implementation plan, to improve expenditure on the grant. The revised implementation plan for the current financial year, in consideration of the R4,1m reduced MIG allocation, will be catered for in terms of the following:

 

A total R61,4 million was approved. The proposed adjusted budget is to be R57,3 million.

 

MIG spend seem to be relatively sluggish and could be no more that 15%. Owing to this circumstances, during the last council meeting, there was an item that was served to expedite capital expenditure performance in a sense that we had about three projects which were not moving as quick as anticipated, this included the Charlottesdale Community Hall and the road leading to Nonoti Beach. There was a rationale on the submission to reprioritize and bring in projects that will then expedite expenditure. Surely by the end of the second quarter, or early January, we are likely to realise improvements in terms of capital expenditure. 

 

Other amendments affected on the capital budget

 

Funds have been reallocated to cater for challenges currently being experienced with the new generators. A request of R1,6m has been made for the completion of the procurement and subsequent installation of back-up generators. The additional funding requested has been sourced from various votes within the business units.

 

COMMUNITY SAFETY – the Fire Fleet budget has been reduced by R 4,1 million due to this payment going through in the 2023/24 financial year.

 

CIVIL ENGINEERING SERVICES – Internal funds of R10,4m for the Hullete Bridge project will be adjusted as the roll-over has been approved. A project listing of six for the Municipal Disaster Recovery Grant of R22,027m has been provided by the business unit as outlined in the item before you.

 

COMMUNITY SERVICES – R 1m EDTEA prize money has been received by the Waste Management services which will be split between operational and capital projects.

 

PUBLIC TRANSPORTATION

We are proposing additional funding for two existing projects  which are the Ballito and KwaDukuza Taxi Rank. The proposed allocation for the Taxi Ranks for 2023/24 financial year are as follows:

 

Refurbishment of KwaDukuza Taxi Rank has an approved budget of R6 million, the proposed adjustment is R11,3 million.

 

The approved Budget for the upgrades to the Ballito Taxi Rank is R2 million, the proposed adjustment is R5,5 million.

 

Development will take up 16,8 million for the Upgrade of both facilities.

 

Council must note that the funding provision for the taxi rank and other adjustment proposals have no impact on the cash flow coverage since this is not new money or additional funding, it is what is already within the budget. 

 

What gave rise to the additional funding request is based on several consultations with the taxi associations who then raised the issue of shelters as a basic need in their facilities therefore in essence, the current adjustment is what we have already committed in terms of the approve budget. Nonetheless, efforts must be made to push the cash coverage to at least two months or more in the near future.

 

OPERATIONAL BUDGET AMENDMENTS

There are minor amendments to the operational revenue and expenditure in relation to the receipt of Vuthela funding and EDTEA Prize Money. A virement of funds to the value of R2,5m have been considered to the Data-Cleansing from the Area Based Management Project.

 

The R2,5m has been transferred from the Area Based Management project to cater for the Data-Cleansing Project which is currently at TEC. The Area Based Management Project was budgeted for as a multi-year project and will be considered in the outer years only. Also, transfers to grants and subsidies will be adjusted in terms of the amendments.

 

In order to further ensure council exercises oversight, I will tabling the Section 72 mid-term budget review by end of January 2024.

I invite all Councillors from the left to the right in the political spectrum to support this adjustment proposal. I therefore move the recommendations carried on the item for your consideration noting that there were no major changes on the budget allocation.

 

Thank you!