KwaDukuza Mayor tables R3.37 draft budget for 2026-2027 Financial Year

KwaDukuza Mayor Siduduzo Gumede today, 26 March 2026, tabled the draft budget for the 2026/27 financial year, with a strong focus on financial stability, service deliver, good governance and inclusive economic growth.

Gumede delivered a prepared budget statement during a full council sitting at the KwaDukuza Town Hall where he pointed out that the R3.37 billion draft budget into the upcoming financial year is balanced, funded and credible.

"I deliver this report in the immediate aftermath of a defining moment in our nation’s democratic journey where South Africa marked the 66th anniversary of the Sharpeville massacre on 21 March 1960 and 30 years since the adoption of our Bill of Rights. At the altar of human dignity, we reaffirm a timeless truth that human dignity is a right inherent in every person. This reminds us of the position we should take as citizens to defend the gains of our liberation struggle against any threat to democracy, tackling both domestic and foreign headwinds.

 

In this watershed year of local government elections, as we reflect on three decades of democratic local governance since 1996, thirty years now, we have been placing people at the centre of development. Our draft budget into the upcoming financial year is a practical expression of this commitment.

 

Two weeks ago, KwaDukuza Municipality was honoured by the MEC for the Department of Cooperative Governance and Traditional Affairs (COGTA) with two prestigious awards at the Municipal Service Excellence Awards.

 

We received recognition as the “Improved Revenue Enhancement & Debt Collection” and for “Most Functional Municipal Fire and Rescue Services” 

 

These accolades make a powerful statement about the dedication of our teams and the collaborative spirit of our communities.

 

Our Fire and Rescue Services have demonstrated exceptional readiness and response capabilities, while our revenue strategies are showing outstanding results with a collection rate of 100.44%. This is an improvement from the previous year, through targeted initiatives such as meter inspections and back-billing.

Further afield where many municipalities continue to struggle with poor revenue collection, electricity disruptions, and infrastructure challenges, as rightly pointed out by the president in the recent State of the Nation Address, KwaDukuza is showing resilience.

 

These awards affirm that we are on the right path and give us renewed energy as we present the draft budget.

 

Fellow councillors, the draft Medium-Term Revenue and Expenditure Framework before you is balanced, funded and credible.

 

Following the rigorous zero-based budgeting process at MANCO and BSC level, and with the decisive interventions made in our mid-year budget adjustments tabled on 26 February 2026, we have eliminated the initial R153 million deficit that appeared in the early draft.

 

Our operating revenue is projected to grow by R253.6 million, representing 8% compared to the 2025/26 adjusted budget.

 

Our operating expenditure is set at R3.262 billion.

The capital budget for 2026/27 is R107.3 million, with the three-year capital envelope totalling R263.8 million.

 

This budget remains firmly aligned with our Integrated Development Plan and responds directly to Council’s eight strategic priorities, with a strong focus on basic service delivery, financial viability, local economic development and good governance.

 

We continue to build on the progress highlighted in our mid-year performance assessment. During the first half of 2025/26, we achieved a revenue collection rate of 100.44%.

 

This contributed to strong performance in refuse revenue at R4.8 million above target, and operational grants at R71.9 million from early Equitable Share receipts. We also maintained fiscal discipline, under-spending the operating budget by 7%, totalling R109 million savings, while advancing capital projects, with 43% of the Municipal Infrastructure Grant spent and key electrical upgrades on track.

 

Ladies and gentlemen, to continue building on our award-winning revenue enhancement efforts and the momentum from the mid-year review, we propose the following adjustments, subject to public consultation and NERSA approval where applicable:

 

• Property Rates will see an overall revenue increase of 6%. The proposed randage for residential properties is 0.7972 cents in the Rand (subject to finalisation of the 2026 General Valuation Roll). The general rebate is being phased out, while we strengthen targeted relief for the vulnerable.

 

• Ladies and gentlemen, the new 2026 General Valuation Roll that will come into effect in the upcoming financial year will be rating new properties in certain areas that were previously not rated and these areas include Thembeni, parts of Groutville, Mellville, Ntshawiniand eTete.

 

• On refuse removal, an average increase of 7%, supported by a further 2% growth in billing as we extend services to previously unbilled areas.

• Electricity Tariffs increases will range between 9% and 11% (pending NERSA approval), with bulk purchases budgeted at the approved 9.01% increase. An additional R20 million is conservatively projected from our ongoing amnesty programme.

 

• Miscellaneous tariffs will vary increases as detailed in the Tariff of Charges.

 

• We are resolute at cushioning the poor through the revised Indigent Policy, generous pensioner rebates of up to 35%, 100% rebates for child-headed households and land-reform beneficiaries, and other targeted relief measures. 

 

Going forward, we will be relaunch the Masakhane campaign to encourage payment for services.

 

Building on the mid-year assessment and the adoption of the Turnaround Service Delivery Improvement Plan in November 2025, we continue to review it and implementing tough but necessary measures to safeguard long-term financial sustainability.

Ladies and gentlemen, considering the delicate nature of our budget, at BSC level, we have taken the following approach:

 

• Employee-related costs are contained at a 4.5% general increase plus notch and grading provisions.

• Overtime has been reduced to R51.4 million.

• Non-critical vacancies are frozen until August 2026.

• Bulk electricity purchases have been reduced by R122 million through intensified energy-loss reduction interventions (noting that energy losses stood at 27.65% or R242 million in the mid-year review).

• Refuse and security contracts are under active renegotiation.

• Internal capital funding is limited to rolled-over projects only.

 

These actions, together with the Financial Stability Turnaround Framework that we will strengthen our position but we will be askingCouncil for its adoption. 

 

The Framework will address the worsening operational financial challenges that the municipality is facing.

 

Yesterday, at the Executive Committee meeting, the acting accounting officer presented the Framework, indicating that approximately 80% of our operational expenditure consists of fixed or quasi-fixed costs which are primarily bulk electricity purchases, employee-related costs, refuse removal, grass cutting and security services, which have caused operating expenses to consistently outpace revenue.

 

A detailed Turnaround Strategy will be submitted to Council after the Focus Group that was appointed by the acting MM concludes its work.. 

 

We will also accelerate smart metering, strengthen debt collection with data cleansing and incentives, and fast-track capital procurement to meet MIG thresholds.

 

Our capital programme of R107.3 million for 2026/27 prioritises the renewal of existing infrastructure, totalling 43% of the allocation, and the completion of critical disaster-recovery projects. 

 

This builds on the mid-year capital spending of 40% against the SDBIP milestone. Priority will be given to grant-funded rolled-over projects. All new projects will be supported by full business and operating plans as required by the MFMA.

 

Sixteen budget-related policies have been reviewed and are tabled alongside this budget for Council’s consideration. These policies will guide implementation from 1 July 2026 and reinforce the governance excellence that earned us national recognition, including our consistent funded budgets and progress toward a 21st consecutive unqualified audit.

 

This draft budget is now open for public engagement, where we will be embarking on our first Roadshow on 08 April 2026 and conclude by the end of April. We invite all stakeholders to participate actively during these consultations. Your input will help shape the final budget and ensure we address community concerns.

 

As I close, I hereby present the Draft Medium-Term Revenue and Expenditure Framework (MTREF) for consideration and approval as set out on the item.

 

Honourable Councillors, the two COGTA awards that were obtained by the municipality, together with progress made in the first half of the 2025/26 financial year, remind us that when we work together with discipline and focus, we can deliver.

 

This budget builds on a similar trend of success that requires continued accountability and collaboration.

 

Ends

Issued by the Office of the Mayor of KwaDukuza