As the fiscal year begins tomorrow, those who are not in the know may ask why we have left the passage of the budget so late. We could no longer delay the completion of the budget, so we had to work with the budget assumptions we had made earlier. Fellow councilors, we also had to be aware of the effects of the global economic downturn staring us all in the face.
The implementation of the new property tax policy in Lukhanji, supported by a new valuation list, has reached an advanced stage. This represents a dramatic increase on the total rate base of the previous general valuation list.
Budget Related Resolutions
That provision is made in the draft Property Tax Policy to continue with the existing practice of continuing with the levying of an Infrastructure Levy on properties that will be exempt from the payment of property tax, as permitted in sections 11(2) and 11(3) of the Municipal Property Tax Act No 6 of 2004 and the phasing in of property tax. That specific percentages/figures be included in the draft Property Tax Policy in respect of exemptions, reductions and rebates as envisaged in section 15 of the Municipal Property Tax Act No 6 of 1994.
4 Executive Summary
Operating income is expected to reach R333.5 million (including currently known grants received for operating expenditure); operating expenditure funded by the cash transfer and operating income is proposed at R333 million. In Rand terms, the budget related to salaries and allowances has increased by almost Rand 18.2 million over the adopted budget in the 2008/09 current budget. The capital budget reflected in this document uses actual expected revenue, cash advances and borrowings to fund budget expenditure of R72.3 million.
Major items include the allocation of almost R62.4 million in conditional capital grants and housing grants awarded to the municipality. Most of these items (which amount to around R9.9 million) are funded by conditional grants that specify what the money can be.
Revenues
Expenditures
How the Total Operating Revenue Budget are funded (R333.5 million)
How the Total Budget Operating Expenditure are allocated(R333
INCOME BY SOURCE Checked Actual Approved Budget Adjusted Budget Forecast for the full year Budget Budget Budget. BUSINESS EXPENDITURE BY VOTE Audited Actual Approved Budget Adjusted Budget Full Year Forecast Budget Budget Budget. CAPITAL EXPENDITURE PER VOTE Audited Actual Approved Budget Adjusted Budget Full Year Forecast Budget Budget Budget.
CAPITAL FINANCING BY SOURCE Controlled Actual Approved Budget Adjusted Budget Annual Forecast Budget Budget Budget. These charts align with the budget charts presented above and are presented to illustrate the related numerical chart.
Lukhanji Municipality 2009/10
The follow-up plan was approved by the Council in August 2008 and was followed in the preparation of the mid-term budget document 2009/10.
KEY DEADLINES FOR BUDGET PREPARATION SCHEDULE
Although most of the technical preparation of the document is done by employees, according to the ZUFM the budget is a mayor's document. In July 2008, the Mayor appointed a Budget Steering Committee to assist in political oversight of the budget process. In August 2008, the mayoral committee approved the budget plan and submitted it to the council.
This section should give readers a good understanding of what the IDP contains and how it guides budget allocations. However, it is critical that the budget documentation user obtain a good high-level overview of the IDP and refer to the detailed IDP documentation.
Vision
Every year the IDP must be revised as required by the Municipal Systems Act and the MFMA. It should be reviewed for performance in achieving outcomes and outputs as the current financial position and future fiscal outlook of the municipality will have a direct impact on delivery. The review will ensure that the plans are still within Lukhanji's financial capacity.
The intention is not for the IDP to join as an annex or to repeat everything in the IDP.
Mission
Value
OBJECTIVES & STRATEGIES
By revising the assessment roll in accordance with the Property Assessment Act to cover the entire municipality and linking it to the settlement system. By developing internal capacity and lobbying support and resources from other spheres of government for air quality management, environmental condition reporting and processing of EIAs. By developing and implementing a housing sector plan to guide the implementation of the housing development by 31 March 2009.
Lobbying on land issues to support planning, implementation of land reform, land surveying and housing projects in our country. By lobbying resources from the province and the district municipality for the establishment of the fire department. By lobbying the district to accelerate the provision of basic water service and infrastructure in all our areas to reduce.
By implementing water demand management strategies and public education in line with the Chris Hani WSDP. Lobbying the county to accelerate the delivery of basic sanitation and infrastructure services and reduce congestion by 3% in June 2009. Transport to build, maintain and improve local access roads in line with their budget commitments.
By lobbying telecommunication service providers like Telkom, Cell C, MTN and Vodacom to provide the necessary infrastructure for network coverage in all Lukhanji areas. 49 To regulate and control the construction of building structures in accordance with local ordinances and planning schedules.
INTRODUCING THE CLUSTER CONCEPT
FUNCTIONAL AREAS BY CLUSTERS
Traffic j) Public spaces and parks.. k) Amenities - Sports and recreational facilities.. l) Community facilities (Halls, payment points, libraries, museums, etc.) m) Licensing of dogs.. n) Control of liquor outlets.
Consideration of service delivery and funding for services
This section seeks to provide a broad overview of the budget policy framework and highlight the amended policies to be approved by council resolution. This policy lays down the framework and the principles according to which the municipality deals with those citizens who either want to join the municipal services or fall into arrears with the municipal services for which their service is provided. This policy sets out the application process, the invoicing process and the mechanism to be used when carrying out the debt collection function.
The free basic services policy is written in accordance with national guidelines and recommendations and states that households registered as indigent within the municipality will receive 50 kW of electricity and 10 kl of water each month free of charge for the provision of basic services. In accordance with the MFMA, the council adopted a 'money and investment policy' in the past financial year, which sets out various principles and reporting obligations for the investments of the municipality. This policy sets a framework for the municipality to use when considering the use of debt for a project.
This policy also sets self-imposed limits on both the total amount of debt that can be issued by the municipality and the amount annually required for annual debt service. The MFMA required the municipality to adopt and implement a new supply chain policy by January 1, 2006. The policy set limits on the different procurement methods used within the municipality and delegated the authority to implement the policy to the Accounting Officer as required by the MFMA.
This policy delegates certain powers and responsibilities to the mayor and municipal manager and requires that all such expenditures be submitted to council in an adjustment budget as soon as possible. This policy is intended to set guidelines for the issuance, use or budget of debt instruments in the municipality. In order to prepare meaningful budgets, it is necessary to assume internal and external factors that could affect the budget.
Budget Assumptions Table 2009/10
Due to the 31.3% increase in the cost price of bulk electricity, the rates charged to customers will increase by 28.9% this year. The council will not be able to balance the budget if appraisals are required in all its areas as a result of the elimination of the flat rate and many properties could be exempted from paying rates. The municipality was instructed to rectify this situation before the end of the 2007/2008 financial year.
The municipality will end 2008/09 with enough money at the end of the financial year to pay all its creditors. Credible budgets have realistic projections of revenues and expenditures, and their implementation improves the financial sustainability of the municipality. Detailed lists of all fees and charges proposed for the 2009/10 financial year are in Appendix A.
We will focus on the four main council charges along with property charges. This amount should be fenced off and used for the future renewal of the electrical network. Lukhanji provides water and wastewater services as an agent of the Chris Hani District Municipality.
The municipality also has plans to investigate the elimination of certain areas and activities that are not part of the core tasks of the municipality. This grant is provided to promote and support reforms in financial management and the implementation of the Municipal Finance Management Act. The table on the next page details the allocations the congregation expects to receive.
Cash Carry Forward
Capital Grants Projects
Operating Grants Projects
Table 10 – Revenues by Source and Vote
Sports fields 124,000 Rental of real estate This is a cost-covering allowance for the use of sports facilities by the. Contribution to water distribution by Chris Hani The municipality does the service on behalf of the district municipality. County government to cover some of the council's costs for providing the service on their behalf.
Roads 82,000 Connection Charges: Private Works This is a charge to cover the cost of carrying out private works only for. Cemeteries 61,000 Grave Digging This is a fee to cover the cost of digging graves for the community. Grazing fee 21,000 pounds and the municipality This is a fee to cover the cost of feeding impounded animals in pounds.
Protective Services Control 105,089 WSSA Contribution This is a fee to reimburse the costs of providing a 24-hour community response center. Most of the law's requirements went into effect immediately; however, certain parts of the Act were set up with varying delays based on the municipality's 'capacity' as determined by the Treasury. The municipality has already implemented many of the major changes required by law.
Much of the implementation of the MFMA involves new and sometimes complex budgetary and financial reporting requirements. The mayor is required to provide quarterly reports to the council on all aspects of budget implementation and any issues that need to be addressed. Capital programs should be approved as a whole. comprehensive capital budget to ensure that projects can be executed against the implementation plans.
