We as Council, have since 2011, succeeded in turning this gigantic Drakenstein ship around from financial disaster to a financial sustainable organization. We have turned negative working capital results of the past around and are now en route to achieve our mandate from the public to create a local municipality of excellence

Executive Mayor Gesie van Deventer during her draft budget speech on Monday, 31 March 2014

Speaker, finally after three years of fiscal discipline, we can adopt the mission to realise positive working capital operating cash results and start rebuilding our reserves that have been depleted over many years prior to 2011. See the graph below, extracted from Chapter 5 IDP (2014-2019)   (Long term Financial Plan)

These were the words of Mayor Gesie van Deventer when Drakenstein Municipality’s annual draft budget 2014/15 was approved by the council on Monday, 31 March. This draft budget will now go through a public participation process for inputs from the community and stakeholders.

As from 7 April 2014 until 25 April 2014 the Integrated Development Plan (IDP) and Budget consultation process with the community will commence.

The municipality will have public meetings in all 31 wards to obtain inputs and comments on the municipality’s Integrated Development Plan (IDP) for the financial year 2014/2015.

After this process, the Executive Mayor and her Mayoral Committee will consider all the comments received from the community, stakeholders, National and/or Provincial Treasury, councilors and senior management before the final budget will be tabled for final approval by Council before 31 May 2014.

The Mayor said, the proposed budget of the Municipality is responsive to the economic growth, strategic objectives and the socio-economic needs of the residents of Drakenstein. We have paid particular attention to the difficult economic climate.

The exact percentage increase or decrease of each tariff type is reflected in the tariff list that will be available for inspection at municipal offices and all libraries during the public participation process.

The 2014/2015 capital budget expenditure amounts to R284, 8 million and the operating budget expenditure amounts to R1, 559 billion. The total budgeted expenditure therefore amounts to R1, 844 billion and this amount is estimated to increase to R1, 946 billion, R2, 080 billion, R2, 221 billion and R2, 299 billion respectively for the four outer years of the Medium Term Revenue and Expenditure Framework (MTREF).

According to the Mayor, “Any organization who spent R1, 343 billion (99, 85%) of their R1, 345 billion budgeted operating expenditure and R235, 2 million (95, 3%) of their R246, 7 million budgeted capital expenditure must have done something right. The Auditor-General gave us an unqualified audit opinion on our 2012/2013 annual financial statements and through that opinion has confirmed that our financial matters are 100% in order,” said the Executive Mayor Gesie van Deventer.

The Municipality has also continued to accommodate all citizens and not only the poor. We have succeeded in accommodating the poor and those struggling financially:

• Property rates revenue with 5.6% which is lower than the anticipated  inflation rate of 5.8%;
• Electricity revenue for life line consumers with 5.5% which is lower than the anticipated  inflation rate;
• Electricity revenue for other consumers with 7.39% as provisionally determined by NERSA;
• Water revenue with 12.0% – a downward trend when compared with the 16% of the current financial year. Historically a loss was sustained on this service;
• Sanitation revenue with 15.0%. Historically a loss was sustained on this service;
• Refuse removal revenue with 9.7%. This increase is to prevent significant unplanned increases when the Wellington landfill site reaches the end of its useful life or alternatively to make provision for the costs involved with the envisaged waste to energy project at the Wellington landfill site;
• Rental revenue with 7.5%; and
• Sundry revenue with 10.0%.

The Municipality also provides support to households who are unable to pay or struggle to pay for their basic services. These households can apply to be registered as an “Indigent Household” in the indigent register in order to obtain this benefit or to qualify for rebates from their municipal basic services or property rates levied. This can be done at any municipal office.

The Municipality provides free basic services to poor households as a means of poverty alleviation.

The proposed implications for poor households are as follows:

• 100 Free Electricity units per month
• 10 kiloliters Free Water per month
• Free Refuse removal services
• Free Sanitation services
• Free Housing Rental services
• 100% Subsidized property rates

In other words Indigents only pay for services, should they use more than the allocated free water and electricity. Drakenstein Municipality also provides 10kl of water free to all its residents.

For the 2014/2015 financial year the proposed qualifying criteria for indigent status households are:

• Main breadwinner/s earning less than R3, 300 per month;
• Pensioners and disabled persons qualify for a 100% rebate on property rates and financial assistance of 100% of the indigent subsidy for services rendered if their earnings are also less than R3, 300 per month;
• Financial assistance and rebates of 80% of the indigent subsidy can be given to those retired and disabled households who earn less than R3, 800 per month;
• Financial assistance and rebates of 50% of the indigent subsidy can be given to those retired and disabled households who earn less than R4, 400 per month;
• Financial assistance and rebates of 20% of the indigent subsidy can be given to those retired and disabled households who earn less than R5, 000 per month.

The budget also provides some relief for all our Drakenstein residents, not only the poor.

The first R160 000 value of all residential properties will be exempted from property rates.

Capital projects of interest to the public are-

• Labour intensive ward projects (R 100 thousand per ward);
• Construction of Stokery Road, Wellington (R 15 million);
• Reseal of Berg River Boulevard South (R 2.4 million);
• Upgrade of secondary routes (roads) in Drakenstein (R 3.3 million);
• Upgrade existing sidewalks in Drakenstein (R 500 thousand);
• Upgrade sidewalks in wards (R 2.2 million);
• Traffic calming in Drakenstein (R 549 thousand);
• Refurbish storm water systems (R 4.7 million);
• Refurbishment of Ikhwezi Centre for skills development (R 2 million);
• Upgrade of community squares (R 106 thousand);
• General equipment for community squares (R 16.6 thousand);
• Development of tourism gardens (R 62.4 thousand);
• Upgrade soup kitchens (R 74.2 thousand);
• Equipment for soup kitchens (R 15.9 thousand);
• Beautification of town entrances to attract tourism  (R 53 thousand);
• Construction of informal trading structures in Paarl CDB (R 200 thousand);
• Construction of informal trading structures in Wellington (R 500 thousand);
• Extension of Mbekweni business hive (R 500 thousand);
• Refurbishment of Arendsnes building (R 300 thousand);
• Construction of informal trading structures in Drakenstein (R 1 million);
• Early childhood development infrastructure in Drakenstein (R 45 thousand); and
• Upgrading of taxi rank in Mbekweni (R 282 thousand).

The Mayor announced that the 2014/2015 budget makes provision for an allocation of R 110,000 to each ward to be used for labour intensive capital projects. The intention with these allocations of R 110,000 is to implement labour intensive capital projects in a ward, visible to residents. That can be pavement projects, speed bump projects, the development of play parks, upgrading of community halls and etcetera. These capital projects will be identified through a public participation process devised by the Executive Mayor and Mayoral Committee.

Some of the major capital projects for the next financial year are –

• The construction of Stokery Road in Wellington (R 15.0 million);
• Upgrade of the bulk sewer line in Southern Paarl (R 26.2 million);
• Construction of a 11 ML reservoir in Newton (R 16.1 million);
• Replacement of Strawberry King bulk water pipeline (R 11.6 million);
• Rehabilitation and extension of Wellington waste water treatment works (R 39.3 million);
• Upgrade of South End 66/11kV substation (R 8.1 million);
• Construction of Welvanpas water treatment works & out buildings (R 11.4 million);
• Refurbishment of bridge structures (R 7.6 million); and
• Upgrading of proclaimed and main roads (R 20.9 million).
• Upgrading Weltevrede sport grounds (R 5.6 million);
• Cloakrooms/ablution facilities at Hermon sport ground (R 1.6 million);
• Replacement of tartan track at Daljosaphat Stadium to attract sport tourism (R 14.0 million over two financial years);
• Electrification of housing projects (R 3.5 million);
• Bo Dal Road street lighting extensions (R 810 thousand);
• Berg River School Wellington street lighting (R 438 thousand);
• Saron waste water treatment works rehabilitation and upgrade (R 3.8 million);
• Drommedaris boundary wall (R 1.4 million);
• Water meters and connections at Amstelhof  to enable residents to take long awaited transfer of their properties (R 1.6 million);
• Construction of drop-off, chipping and crushing area at Wellington landfill facility (R 3.7 million);
• Minimum basic services to informal settlements (R 300 thousand);
• Simondium new bulk sewer planning (R 700 thousand);
• Upgrade of sidewalks in Drakenstein (R 2.8 million);
• Versailles Street, Wellington storm water channel (R 500 thousand);
• Upgrade Jan Phillips Mountain Drive (R 1.5 million);
• Traffic calming in Drakenstein (R 400 thousand);
• Traffic calming in Main Street, Paarl/Wellington (R 450 thousand);
• Upgrading of gravel to paved roads (Saron/Gouda) (R 500 thousand);
• Traffic lights in Drakenstein (R 1.4 million);
• Finalising refurbishment of Ikhwezi centre (R 500 thousand);
• Upgrade of own rental stock (R 1.2 million);
• Water fun park at New Orleans (R 2.0 million);
• Upgrading of community squares (R 106 thousand);
• Development of heritage area in Saron (R 250 thousand);
• Upgrade Victoria Park (R 127 thousand);
• Early child hood development infrastructure (R 424 thousand);
• Upgrade soup kitchen facilities (R 116 thousand);
• Upgrade of Mbekweni sport and rugby stadium (R 650 thousand);
• Upgrade of Fairy Land community hall (R 200 thousand);
• Upgrade community hall in Saron (R 100 thousand);
• Playground equipment and development (R 815 thousand); and
• Additions to Mbekweni Multi-Purpose centre (R 45 thousand).

The Mayor made special reference for De Kraal; “I promised my community the development of De Kraal will be implemented. An initial provision of R 300 thousand has been made in the 2014/2015 operating budget for the planning and public participation processes. The capital funding for the development will thereafter be made available.”

MUNICIPALITY DISCUSSES BUDGET WITH STAKEHOLDERS. Drakenstein Municipality had a public engagement recently with stakeholders to discuss budget related matters for the 2014/2019 medium term revenue and expenditure framework. Stakeholders were invited through an advertisement in the newspaper and had the opportunity to engage with the Executive Mayor, Portfolio Councillors and Senior Management on budget related matters. The budget related matters discussed were: long-term sustainable financial plan, capital and operational budget, revenue streams, external borrowings and budget related policies.