By Lehlohonolo Lehana.
City of Johannesburg Finance MMC Dada Morero on Tuesday, began his budget speech with a dire review of the city’s finances.
The tabling of the budget has been delayed by the political instability in the metro which has changed mayors thrice in the first half of this year.
The city’s operational expenditure sits at R73.3 billion, while capital expenditure stands at R7.6 billion for the 2023/24 financial year, with a three-year capital budget of R24.4 billion.
Morero painted a dim picture of the city’s finances, blaming it on poor revenue collection by the previous administration.
According to him, revenue collection dropped from R6.6 billion in June 2021 to R3.8 billion in June 2022.
“We need a minimum of R4,3 billion per month to fund the city’s operations and deliver services so that we can survive as the people of Johannesburg. Unfortunately, there is no R4,3 billion to survive,” the MMC told councillors.
He revealed efforts to cushion property owners against the pressures of interest rate hikes imposed by the South African Reserve Bank in recent months.
The proposed increase in property rates was slashed from just over 5% to 2%.
“In the new financial year of 2023/2024, the property rates will increase by 2%. We have also made some changes to rebates and relief measures offered to residents, notably the introduction of a sliding scale on pensioner rebates.”
Water and electricity tariff hikes will be accompanied by an aggressive campaign for revenue collection and efforts to curb non-technical losses.
Morero said losses on electricity and water peaked in June 2022 at 30 and 32% respectively, an increase from 29 to 25% losses respectively in June 2021.
The lion’s share of the city’s budget goes towards the cluster on sustainable services, which includes the Environment and Infrastructure Department, Housing, City Power, Johannesburg Water, Pikitup, and the Johannesburg Social and Housing Company.
“A capital budget of R14.9 billion across the medium-term and an operational expenditure budget of R45 billion in the 2023/2024 financial year, has been allocated to the Sustainable Services Cluster,” Morero said.
The Environment and Infrastructure Services Department has been allocated an operational expenditure budget of R133.7 million, Pikitup gets an operating allocation of R3.9 billion while the Human Settlements Department has been allocated an operational expenditure budget of R1.2 billion.
Councillors are expected to vote to adopt the proposed budget after the debate on Wednesday or face the city being placed under administration.
Meanwhile Johannesburg Mayor Kabelo Gwamanda says council rules do not require him to be the subject of media interrogation.
Gwamanda was responding to the State of the City Address debate on Tuesday, which was postponed on Wednesday last week after he fell ill.
The Al Jama-ah councillor has been heavily criticised for continuously cancelling media engagements since he took office.
Gwamanda used the Tuesday opportunity to take a swipe at his critics.
“To all the residents in the City of Johannesburg and beyond, I would like to note that there is a fine distinction between fact and fiction, service delivery and grandstanding, leadership and acting.
“But most importantly, the blurred distinction between news reporting and driving sponsored narrative – with power comes great responsibility.
“And the notion that suggests that mere perspective is everything is detrimental to our society.
“Madam Speaker, allow me to educate fellow councillors in opposition and in the same breath assist our residents with information regarding the roles of the executive mayor in accordance with chapter 4 of the standing rule and orders of council section 35.2, which is clear and nowhere does it stipulate that the executive mayor is obligated to subjecting him/herself to social media or media houses for interrogation,” said Gwamanda.