1.3 EXECUTIVE SUMMARY 1
1.3.4 KEY ISSUES
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There are plans to intensify programmes and campaigns to assist with the non-revenue water challenge. This is tackled by pressure management which includes lowering the water pressure in the municipal area. There is also a programme for leak detection whereby about 5 000 km of pipes are surveyed for leaks. Reactive measures are reports that come through the call centre where members of the public report leaks. Some of the strategic directions and programmes being implemented include the use of hydraulic modelling software, real time monitoring of the reticulation network, automation of pipeline fault data to guide the pipe replacement programme.
The municipality will be implementing a 10 point plan to address water loss challenges in the city which includes:
- Continuation of the meter replacement programme for industrial, commercial & institutional customers - Ensuring that all connections, including fire and sprinklers are metered
- Domestic meter replacement
- Metering and control of all informal settlements and housing developments - Enforcement and control of illegal connections policy are conducted daily - Utilization of community plumbers to deal with leaks
Every possible measure will be taken to curb the water loss as this has an impact on the setting of an affordable water tariff. The effectiveness of the measures put into place will be reviewed on an on-going basis.
UNFUNDED MANDATES AND FUNDING REALITIES
Certain non-core functions and services which in terms of the constitution fall under the responsibility of National or Provincial Authorities are being provided by the municipality. These functions include the provision of Health Services, Libraries, Museums, and Housing. The reduction or non – payment of subsidies for these services require the municipality to allocate its own resources to make up the shortfall. These unfunded/ underfunded mandates pose an institutional and financial risk to the municipality as substantial amounts of own funding is being allocated to non-core functions at the expense of basic service delivery. Although we have done much to address the development challenges of our city, meeting targets will continue to depend on financial support from Provincial and to a larger extent National Government. Despite additional grants received, the levels are still not sufficient to meet unfunded mandates. We believe that given adequate levels of funding, the city could meet the huge challenges we still face.
The devolution of Municipal Health Services (Environmental Health Service) from the provincial sphere of government to local government is underway with 32 provincial health staff being identified to be transferred to the municipality. Budgetary provision has been made for this together with the transfer of assets to eThekwini Asset register. The process is expected to be finalised shortly.
The costs of unfunded mandates for 2015/16 are as follows:
R’m
Libraries 184.1
Health – Other than municipal health services 353.3
Museums and Heritage 56.7
Housing: New Development and Hostels 308.9
Formal Housing 45.0
948.0
In addition R 3.3 billion in respect of expenditure on housing projects on behalf of the Provincial Department of Housing has not been reimbursed as yet.
SALARIES AND ALLOWANCES
In order to ensure effective utilisation of available budgetary provisions and contain personnel costs, this expenditure is continually being reviewed and the filling of all vacancies currently has to be authorised prior to the recruitment process. As a result the percentage Salaries and Allowances of the total Operating Budget has declined steadily to a level of 23.9 %.
Whilst this percentage reflects a decreasing trend (mainly due to the bulk electricity purchases increasing at a fast rate thereby driving the relative share of all other expenditure categories down) there has been an increase in the number of posts and positions filled. A rationalisation of all vacant posts will be undertaken with greater scrutiny by the management services unit. Productivity assessments are on-going to ensure that all staff are accounted for, are effectively engaged and are adding value.
CLIMATE CHANGE
Climate change already causes and will continue to cause a number of challenges for EM, linked to impacts such as increased temperatures, extreme weather events (e.g. flooding and drought), sea level rise and climate variability.
Temperatures in Durban are projected to increase and projected annual rainfall changes are projected to include an increase in aggregated rainfall. This increase is likely to manifest as an increase in extreme rainfall events and stream flow intensity across the municipal area, with prolonged dry spells between rainfall events. Sea level rise along the Municipality’s coastline is already occurring at 2.7 cm per decade and may accelerate in the future.
Recent dry conditions have led to tight water supply in areas to the north of the city. Water levels at the Hazelmere dam have been plummeting to critically low levels leading to water restrictions in these areas. Measures to supplement the water supply include the feasibility of establishing a desalination plant in the north and the possibility of extracting water from the Thongathi River to supply the Hazelmere water works. A Drought recovery plan was recently announced to assist KwaZulu-Natal municipalities mitigate the effects of the drought in the province. The short-term intervention includes the implementation of water restrictions, installation of water tanks, and procurement of generators. Several interventions had already been implemented by the municipality, including water amnesty, war on leaks, employment of additional plumbers and on-going educational programmes.
To respond to these changes EM initiated the Municipal Climate Protection Programme (MCPP) in 2004. This is a phased programme, which has focused on climate change adaptation and enhancing the municipality’s ability to cope with climate change impacts. The likely climate change impacts have been assessed and plans, programmes and projects developed to assist the municipality in dealing with these impacts. A second major work stream facilitated by the EO and the EPCPD is the development of the Durban Climate Change Strategy. The development of the strategy has been a fully inclusive and participatory process aimed at producing a cohesive framework that the Municipality and all residents of Durban can use to contribute towards the mitigation of, and adaptation to, climate change in Durban. Through public participation, ten themes have been identified for inclusion in the Strategy. These are Water, Biodiversity, Health, Food Security, Transport, Energy and Waste/ Pollution, Sea Level Rise, Health, Food Security, Transport, Energy and Waste/ Pollution economy and knowledge and capacity development. Approval is currently being sought from Municipal leadership for the strategy, and an implementation plan is being developed. The municipality is at the forefront of global biodiversity, climate change adaptation and resilience agendas and would soon be joining the C40 Cities Climate Leadership, a global network of cities committed to tackling climate change and increasing urban resilience.
THEFT OF ELECTRICITY
Over the past few years the municipality is faced with a challenge of illegal connections, especially in informal settlements. Illegal connections not only cost the city, but also endanger the lives of residents. Many innocent lives have been lost, and properties destroyed due to fires caused by illegal connections. Legitimate customers also experience continuous outages due to overloaded circuits. Illegal connections are costing the municipality about R 150 million annually. In an attempt to minimize the challenge the municipality has an interim services programme to electrify informal settlements.
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To make sure that illegal connections are eradicated in the targeted areas, operations are carried out at least once a week. Other interventions include optimal network configuration, effective network maintenance and network loading, and installation of anti-theft technologies at substations. There are also customer awareness and educational programmes around safety, reporting theft of electricity and the consequences of connecting electricity illegally.
DURBAN TRANSPORT
A review of the institutional arrangement of Durban Transport including the existing operator model has been undertaken and the Municipal Systems Act Section 78 investigation completed to determine the most appropriate option for the operation of the city’s bus service looking at feasibility, funding and financial implications. The recommendation on whether to operate Durban’s transport service as council unit, a municipal entity or contracted service will be determined by Council after considering the Section 78 investigation as well as Section 84 of the MFMA. Currently, the City’s bus service is operated on a month-to-month basis by Tansnat Africa. The future operational model for the Durban Transport bus service is still under Council consideration, with the mostly favoured option being an external mechanism as it would cost less and offer greater control, governance and insight to the municipality. However, the full impact of the bus services including the capital cost of the Bus Replacement Programme and the operating losses which will need to be borne by the Rate and General Services has still to be quantified. In this regard further engagements will need to be held with National Treasury and the Department of Transport which will include the subsidy and vat implications. The proposed assignment of the transport function to municipalities will impact on the costs to the City as the PRASA and bus subsidies are not adequate and this could severely impact on Local Government Finance.
HOUSING / HOSTELS
Increasing urbanization due to a growing number of people moving into the municipal area for better opportunities together with land invasion is creating a challenge for the municipality and increases the housing backlogs. Limited developable well located land is also a challenge because if it is identified, the municipality has to compete with industrial or environmental land users. At times when the land is available it is steep or unstable and cannot be developed. The issue of land invasion also impacts negatively on the human settlements plan. Furthermore, the cost of servicing housing sites (infrastructure) has increased substantially. Consideration is being given to land banking for future affordable housing. Although the municipality has gained level two accreditation, the long awaited assignment of the Human Settlements function from Province has been deferred.
The increasing deficit anticipated for the operation of the hostels is cause for serious concern. The current deficit amounts to approximately R 309 million and engagements with provincial Human Settlements are ongoing in order to alleviate the burden of these costs on ratepayers