The double-subsidisation of two December 2024 music festivals costing ratepayers R700 000 each reared its head again in a special council meeting last Friday when the municipality’s adjustment budget was tabled and passed.
The adjustment budget is a process undertaken in line with the municipal finance management act (MFMA) to account for less or more revenue than the municipality originally budgeted for; authorise expenditure that wasn’t budgeted for but is unavoidable; move funds from one budget category (‘vote’) to another; authorise the rolling over of funds that weren’t spent by the end of the previous financial year.
Ndlambe’s 2024/2025 adjustment budget records a break-even scenario in operating revenue which increased by 7.7% (R52.6 million) from the original budget, but so did operating expenditure (7.4%).
Capital expenditure increased by 53% (R74 681m) from the original budget.
The operating budget is used to fund the municipality’s day-to-day, short-term costs including the bulk purchase of water and electricity, infrastructure maintenance and repair, and general municipal maintenance.
The capital budget funds major expenses on long-term purchases and investments such as land, roads, sports facilities and parks and libraries.
“Capital purchases are expected to have life expectancies longer than one year, while operating expenses are temporary,” explains the People’s Assembly blog pa.org.za
Because the municipality has or will receive new amounts – mostly national or regional grants that have been allowed to roll over into the current financial year plus disaster relief funding – it has more to spend than it anticipated when it tabled the annual budget in June last year.
Some of the key takeaways of the adjustment budget impacting Ndlambe residents are that additional funds have been allocated to three important service delivery initiatives:
- Bulk infrastructure projects
- RDP housing
- Upgrading informal settlements
Funds coming into Ndlambe Municipality that contributed to the mid-year adjustment budget included:
- A rollover grant of R10 million for disaster relief grant allocated to various service delivery projects
- A rollover grant of R31.5 milion for Human Settlement Bulk infrastructure
- Regional Bulk Infrastructure Grant (RBIG) of R13 million for the municipality’s Quick Wins project
- R50.5m to upgrade informal settlements and build RDP houses
- R1m not spent and rolled over of the library services grant.
From the Sarah Baartman District Municipality comes R869 000 for equipment to support Ndlambe’s fire services, specifically computer equipment.
Outnumbered
Mayor Khululwa Ncamiso was again obliged to address the controversial R1.4 million spending on two similar music festivals, both held at the same Port Alfred venue, within days of each other.
“Remember I objected to the expenditure of R700 000 for NJH donation for [a second] music festival in December 2024 on the basis that it was not budgeted for…,” Ncamiso said responding to a query from Talk of the Town. “I was outnumbered by some councillors and others abstained.”
Ncamiso said she had been careful to avoid using any funds set aside for service delivery to fund this, but had rather used unspent funds for the vacant position of Chief Operations Officer “[because] there is no eminent appointment for this in the 2024/2025 financial year… The matter is now settled.”
Commenting on the adjustment budget priorities, she noted that the department of human settlements was funding bulk infrastructure projects in line with the Section 24 and 27 requirements of the Constitution “even if they have no funds as yet to build houses.
“At least residents of informal settlements must have roads, water and sanitation and electricity so that by the time funds are available to build houses they are ready.”
That was why this programme was called the incremental informal housing upgrade programme.
“Again, COGTA disaster unit is funding us with R29 million to reconstruct roads affected by [flooding],” Ncamiso noted. She said those projects would start this month.
“A big chunk of that money is allocated by COGTA for the roads that are in town. This is understandable because the previous allocation focused on the townships,” she said.
On the portions of the adjustment budget allocated to RDP houses, Ncamiso noted that the municipality was an implementing agent.
“This means the funds for housing are deposited into our account.”
However there were completed housing projects in Alexandria, Marselle and Ekuphumleni amounting to around 900 houses. Another 500 houses were being built in Thornhill.
DA caucus leader Sikhumbuzo ‘Skura’ Venene said their major concern was the donations used for entertainment events that had not been budgeted for.
“The Mayor in her opening remarks covered a couple of our issues,” Venene told Talk of the Town. “However the Municipality received additional grants throughout the year after the original budget had been approved. The capital expenditure increased by 53% compare to the original budget largely due to additional grants received. This resulted in a 59% increase in capital expenditure.
“A total of R137.086 million in additional revenue has been identified for both operational and capital projects,” Venene noted.
“We want to see changes in the Service Delivery and Budget Implementation Plan (SDBIP) and the Key Perfomance Indicators (KPl) should reflect these [budget] changes.
“The DA will pay close attention to monitoring the adjustment budget to ensure it is being implemented according to the plan and if targets are met.”
EFF proportional representative (PR) councillor Mzwandile Mgweba said the fact that the second R700 000 for another music festival had not taken away from service delivery items was the reason the party was not objecting.
“We would have fought anything taking away from service delivery,” he said.
READ THE MEETING AGENDA AND ADJUSTMENT BUDGET HERE
SPECIAL NDLAMBE COUNCIL AGENDA 28 FEBRUARY 2025 PDF
- This article was first published in Talk of the Town, March 6, 2025. The newspaper serving the communities of Ndlambe and the Sunshine Coast, with a weekly wrap of Makhanda news, is available at stores from early on Thursdays
