Ekurhuleni’s improved financial performance paint an optimistic picture

and Cllr. Alta de Beer — DA PR Councillor in Ekurhuleni

Date: 07 February 2022

Release: Immediate

Type: Press Statement

While the mid-year reports largely reflect the performance of the previous ANC administration, the Democratic Alliance (DA) in Ekurhuleni notes the significant improvements since the establishment of the new Multi-Party Coalition Administration.

One example is the R2,5b surplus revenue versus the deficit of the R338K for the same period in the previous financial year.

The Capital expenditure for the reported period is at 83,73% versus the target of 90%. The DA is confident that the Executive Mayor, Ald. Tania Campbell, has the necessary plans and buy-in from the Executive Committee to complete all capital projects related to energy, water reservoirs and roads against the budget allocated for the financial year.

The City’s cash position indicates an improvement from previous periods, including the cash on hand of 21 days. Ideally, the City’s cash on hand should be at 30 days, which is in accordance with the standards set by the National Treasury regulations. There is, therefore, still much room for improvement.

The declining cash reserves are largely attributed to the former administration’s poor collection rate. The main contributing factor to this is that the Municipality has a poor track record in applying uniform and stringent credit control measures.

The DA believes that stricter credit control and debt collection are imperative to improving the City’s cashflow, which will ultimately unlock additional funds for service delivery. The collection rate for the reported period is 83,73% versus the target of 91%. However, the Multi-Party Coalition Administration’s programmes to improve revenue collection is well underway.

The DA has noted that grant funding expenditure is immensely low. We propose that all projects approved against grant funding should be implemented, in order to achieve the objectives of the grants and to unlock potential job opportunities, including opportunities for struggling locally based small businesses.

As the DA, we would like to congratulate Mayor Campbell for ensuring that major creditors and 3rd parties, such as Eskom and Rand Water, are paid within 30 days. We also note that the City does not have creditors older than 90 days — this is a significant improvement from previous financial periods.

Further to note, the cost containment measures implemented are currently at 34% and we are calling for the CoE to boost these measures to achieve the R217m savings target for the financial year.

Additionally, the CoE must expedite the filling of critical positions as it will also assist in the performance of the service delivery departments.

As the DA, we are confident that the new and capable leadership team will lead our City into a resurgence of accountability, transparency, and good governance.

Cllr. Alta de Beer

DA PR Councillor in Ekurhuleni