BCM capex improves to 85%
The money was spent on housing projects, infrastructure, services such as bulk sewers and sanitation, roads and bridges and service delivery.
However, the metro’s debtors increased outstanding arrears by R17-million in this time.
This was revealed in the statement of financial performance and the implementation of the 2016-17 financial year budget report presented to the city council last week by mayor Xola Pakati.
While the report had some good news, showing some improvement in BCM’s spending patterns, there were also some concerns raised by an opposition party, the DA, at the city’s failure to achieve goals which had been set and to cut overtime spending by the targeted 50%.
In the report, Pakati said BCM had managed to spend R1.27-billion (85%) of the capital budget at the end of the 2016-17 financial year.
“This reflects an improvement in both percentage and rand value terms when compared to the same period in the previous financial year , where 78% of the adjusted budget of R1.39-billion was spent,” he said.
The improved results come after Pakati in April gave under-performing municipal officials an ultimatum to “shape up or ship out”.
The warning followed the release of a gloomy report about the metro’s financial performance and poor implementation of the 2016-17 budget at the end of March. By that time BCM had only spent 54% of its capital expenditure, 57% of its operating budget, 64% of conditional grants and 70% of its urban settlement development grant.
However, the new report showed the metro improved in its operating budget spending from 57% in March to 79% by end June.
“The metro has spent 79% of its 2016-17 adjusted budget of R336.7-million as at 30 June 2017.
“This reflects an improvement in percentage terms when compared to the same period in the previous financial year where 67% of the adjusted operating projects budget of R501.84million ,” said Pakati.
Conditional grants spending improved to 96% spent out of a R820.97-million budget and the urban settlement development grant spending improved from 70% in March to 104% spent by the end of June.
Although the revenue collection rate improved from March’s 87.4% to 88.6% in June, the report showed that the metro’s debt book continues to grow.
Pakati said it was a concern that between April and June, disconnection action could not be implemented in the inland (King William’s Town area) due to the “unstable ICT network”.
“This had a negative effect on the implementation of the credit control policy within the inland region. This also results in outstanding rates and services bills increasing, which makes it more difficult to collect the debt going forward,” Pakati said. The debtors book including current accounts by end of June amounted to R1.85-billion.
The amount has increased by R17-million when compared to the 2015-16 debtors’ book of R1.68-billion.
DA councillor Geoff Walton said it was a concern that “excessive overtime” was being run up.
DA councillor Bill Gould raised concerns about the billing systems, which was causing ratepayers to complain constantly.
However Pakati was quick to say the issue was being attended to, and defended the overtime spending, saying: “We have agreed we should cut overtime by 50% and it should be a concern because we are nowhere near that 50% but also the nature of our operations as a municipality suggests that we won’t be able to eradicate overtime completely and that point should be taken with a good heart.” — firstname.lastname@example.org