3 June 2020
The Executive Mayor and Councillors of Drakenstein Municipality, as well as the City Manager and all municipal officials will not receive salary increases in the 2020/2021 financial year. In addition, the Municipality has aimed to keep the new municipal tariff increases as low as possible. This is in response to the financial challenges faced by the Drakenstein community as a result of the COVID-19 pandemic.
Facing an unprecedented economic, social and health trial sparked by COVID-19, countless companies and organisations, including government, are having to go back to the drawing board to review and adapt their budgets, operations and way of doing business. Drakenstein Municipality has done the same and on 29 May 2020, tabled a COVID-19 resilient 2020/2021 final budget at a virtual Council meeting.
This budget is based on realistically anticipated revenue streams, and is credible and financially sustainable. The total budget amounts to approximately R2.9 billion, comprising of a R2.7 billion operating and R217 million capital budget.
Presenting the Budget to Council, Alderman Conrad Poole, Executive Mayor of Drakenstein Municipality, said: “Never before has our community, our country and the world been affected and united in its efforts against a single force – the Coronavirus. The impact of COVID-19 will result in weak economic performance, high unemployment, increasing poverty, constrained government finances and therefore reprioritisation of the whole of government’s expenditure which will have a severe impact on the Municipality’s ability to deliver on its mandate.”
That is why a review of municipal projects and programmes was critical, in order to best serve the community with limited resources and financial strain caused by a current and projected revenue loss.
Tariff increases lower than last year
“When comparing the tariff increases year on year, it is clear that the increase for the 2020/2021 financial year is less than the previous financial year,” Executive Mayor Poole emphasised.
Based on the Draft NERSA guidelines issued on electricity tariffs, the electricity tariffs will on average increase with 6.22%, with domestic consumer’s tariffs increasing with only 4.9%. Property rates will increase with 7.5% (in comparison to last year’s 8.2%); refuse removal services with 7.8% (in comparison to last year’s 10.8%); and sanitation services with 8.3% (in comparison to last year’s 11%). Some tariffs, such as those relating to graves, will remain unchanged.
Concerning indigent support, Drakenstein Municipality will provide subsidised municipal services to qualifying households (people receiving SASSA allowances, child headed families, retired people, the disabled and the unemployed) as per the Municipality’s Indigent Support Policy. During the lockdown, the Municipality has also provided humanitarian relief to the value of R1.8 million (by the end of May 2020) - in the form of food hampers and e-vouchers, working together with Valcare and 200 other local NGOs.
Drakenstein economy loses R800m in income, sheds 2 200 jobs
“Perhaps the biggest and obvious impact of the COVID-19 pandemic on the economy is the loss of income suffered by households, businesses and government due to the shutdown of the economy.
Modelling of the Drakenstein economy, undertaken by economists, show that during April and May 2020:
• The Drakenstein economy lost over R800 million in income and approximately 2 200 jobs;
• Manufacturing, retail trade and transport will account for over 50% of the loss in income;
• Tourism, construction and the informal sector will account for over 80% of the job losses; and
• Drakenstein’s tourism sector lost approximately R65 million in income and shed 700 jobs.
To alleviate the pressure on ratepayers and ensure financial sustainability, Drakenstein Municipality – under the leadership of the City Manager - will continue to focus on revenue, expenditure and cost containment management. The Municipality, which received its fifth clean audit opinion for the 2018/2019 financial year, will also eliminate unnecessary expenditure as far as possible.
Budget highlights of 2019/2020
Reflecting on 2019/2020, Executive Mayor Poole listed achievements and their estimated costs, such as:
1. Bulk and basic infrastructure services for the Vlakkeland Housing Project (R60 million, 507 houses);
2. Completion of Wellington and Paarl Waste Water Treatment Works (total cost of R306.9 million);
3. Electrification of informal settlements and the bulk infrastructure upgrade for the Vlakkeland housing project (R25 million). Estimated 302 structures will be electrified by 30 June 2020;
4. Completion of Van der Stel Street Project (total cost of R21.9 million);
5. Construction and upgrading of sport facilities at Boy Louw, New Orleans, Dal Josaphat, De Kraal, Pelican Park, Mbekweni, Parys, Newton and Faure Stadium (R19.5 million);
6. Establishment of a new control centre equipped with CCTV cameras (R2 million);
7. Upgrading of Boland Park floodlights (R3 million), enabling the hosting of international events; and
8. Bursaries and driver licence training programmes for the youth (R1.5 million).
Looking ahead at 2020/2021
Looking ahead at the new financial year, Executive Mayor Poole said: “It is important for us to facilitate the creation of job opportunities and recruitment in a fair and transparent manner. Participation in the Expanded Public Works Programme (EPWP) must increase the chances of beneficiaries to create sustainable livelihoods and improve service delivery. The EPWP for 2020/2021 provides for approximately 1 316 job opportunities, at an estimated cost of R17 million, and will have a much bigger focus on training.”
A housing grant allocation of R78.2 million will be used to service 459 sites and build 398 new houses. “During the new financial year, we will also focus on restoring the pride and dignity of our communities in informal settlements through improving access to basic services, and provide basic services at the Schoongezight Emergency Housing project,” he said.
Providing clean drinking water and sanitation, Drakenstein Municipality will this financial year build a bulk storage and water treatment works at Saron to the value of R23.6 million (with Integrated Urban Development Grant funding). Securing Drakenstein’s electricity supply, R39.9 million will be spent on electricity infrastructure projects. The construction of a Material Recovery Facility and more drop-off facilities, to the value of R3 million, will form part of its refuse removal projects.
“The maintenance of and investment in roads and stormwater infrastructure remains crucial and for that we have provided R87.3 million for 2020/2021,” said Executive Mayor Poole.
The upgrading and development of a climate smart river park at Paarl’s Arboretum, and the development of a new cemetery are some of the exciting projects lying ahead in 2020/2021.
Strengthening the enforcement of traffic law offences and municipal bylaws, the Drakenstein Municipal Court is due to open its doors within the next three months.
Phase 2 of the Drakenstein Safety and Security Network (DSSN) will be rolled out, enabling the new Drakenstein Central Operating Centre (DCOC) to effectively communicate with all safety partners from a central point, and receive and deal with complaints. The DSSN is a partnership project between Drakenstein Municipality, the Western Cape Department of Community Safety, South African Police Service, community-based safety organisations and the private sector. It provides a platform to work together and share information on safety and security incidents and threats in real time, using cutting-edge technology.
‘Municipality and Drakenstein community to work together to get through difficult times’
Executive Mayor Poole concluded his speech by thanking the public for honouring their commitments in paying their property rates and service charges, even during the difficult and trying times experienced with the outbreak of COVID-19. “The quality of services we render is only possible due to the cooperation of our community in honouring the payment of their municipal bills.”
For the full budget speech, list of 2019/2020 highlights, and schedule of 2020/2021 projects, visit www.drakenstein.gov.za. Drakenstein Municipality’s Final Integrated Development Plan and Spatial Development Framework were also tabled on 29 May 2020.
Issued by: Communication and Marketing, Drakenstein Municipality