By Prinesha Naidoo.
The City of Johannesburg’s finances are improving and South Africa’s commercial capital now has 16 days of cash on hand to cover costs, according to its mayor.
The metro, beset by collapsing infrastructure, is grappling with a fiscal crisis, partly due to chronic mismanagement and difficulty collecting revenue from ratepayers, leaving it unable to pay its bills.
It entered the financial year starting July 1 with an unfunded budget gap of about R2.1 billion and projected an overall deficit of R7 billion.
“In the last three months, we have been able to increase our collection rate, meaning our financial position is beginning to look better, “Mayor Dada Morero said in a SAfm radio interview on Monday.
The city now has 16 days of cash on hand to cover costs, compared with 14 days last month, and is working toward the National Treasury’s minimum 30-day benchmark, he said.
The country’s biggest city will start to ring-fence revenue for Pikitup, its waste-management service provider, from 1 September, Morero said. Protests by contract and causal workers demanding to be made permanent staff have disrupted refuse removal in parts of the city in recent weeks.
Johannesburg last week paid off 5.26 billion rand in overdue power bills it owed state electricity utility Eskom Holdings.