GEORGE NEWS - George residents will have to fork out between 5% and 6,5% more for municipal services in the next financial year. This includes a rise of 6,22% for electricity, 6% for water, 6,5% for sanitation; 6,5% for refuse and 5% for general tariffs.
After several attempts over the past few weeks to get a quorum and with a court order ensuring that all councillors attend and stay for the duration of the meetings, George now has a budget in place.
In addition, the way has been paved for the widening of the bridge over the N2 to Thembalethu.
Two consecutive electronic council meetings were held on Tuesday to table and approve this year's adjustment budget and next year's budget, respectively. The meetings were interrupted so often due to a lack of internet connectivity that the first had to be temporarily adjourned. After a short investigation it was established that the problem was occurring all over the Western Cape.
The adjustment budget was approved during the first meeting, paving the way for the widening of the Thembalethu bridge. Tabling the adjustment budget, Mayor Leon van Wyk said that the municipality had received a Public Transport grant of R82-million to be utilised as the municipality's contribution to Sanral for the widening of the bridge.
The amount needed to transferred to Sanral on the same day (Tuesday). Opposition parties welcomed the news.
Budget is 'interim'
In his budget speech, Van Wyk said the delay in tabling the 2020/2021 budget was brought about partly as a result of the Covid-19 pandemic and its effects internationally, nationally and locally within George. The lockdown, which has been in place since March, has impacted on the tabling of the draft budget, the participation process and the tabling for approval of the budget at different levels.
He said that, while the budget has been deemed to be credible and funded by National Treasury following its budget engagement with the municipality last week, the status needs to be considered an "interim" budget in view of the continuous assessment of Covid-19 on the finances of the municipality.
What about the long term?
Van Wyk said the municipality's long-term financial plan advisors, Inca, undertook a modelling exercise in early May that indicated a reduction of 4 to 5% total expenditure is required. The expected reduction in the debtor collection rate would impact employee-related costs amounting to R41-million and other expenses amounting to R40-million.
It was already evident from the May 2020 financial results that the debtor collection rate had declined from the previous consistent range of 95 - 96%, down to 89 - 90%.
Inca's modelling has also indicated that Covid-19 could lead to the loss of over 5 000 jobs in George and that it will impact on the longer term cash flow of the municipality. Therefore, said Van Wyk, conservation and management of cash flow and of cash becomes of paramount importance. This means better management of the funding mix for capital expenditure. "As a council we are very mindful of the various effects that Covid-19 has had on the George economy, all our business and our citizens," Van Wyk said.
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