Vhembe executive mayor presents budget speech

The executive mayor of the Vhembe District Municipality (VDM), Cllr Dowelani Nenguda, presented his maiden State of the District Address (SODA) at the Saselamani Stadium in Xikundu village last week Thursday.

He said that the government was determined to resolve the following challenges facing the community: access to water and to better roads, unemployment that is affecting mostly the youth, eradication of corruption and eradication of the housing backlog.

He added that the VDM, local municipalities, national and provincial spheres of government will join hands to respond to the issues raised by the communities during previous consultative meetings and campaigns.

He said the national and provincial spheres of government had embarked on a process to reconfigure the government, with the aim of enhancing the capacity and functionality of state. “In the spirit of cooperative governance, the VDM will realign its strategic objectives with the new priorities as announced by the sixth administration.

“We have to ensure that we spend within the prescribed parameters.  We must resist the temptation of spending money we did not budget for, as it will result in unauthorized expenditure.  The municipality has appointed a team of consultants who will assist with the compilation of credible annual financial statements. As such, we have established the Financial Misconduct and Disciplinary Board that will deal with unauthorized, fruitless and wasteful expenditure,” said Nenguda.

He added that the problems related to audit findings for the 2017/18 financial year had reduced from 148 to 108.  Most of the issues raised relate to cash and cash equivalents; revenue and receivables, water inventory and a limitation of the scope relating to legacy issues.

By 15 June this year, the municipality had only spent R347 646 000 as part of the allocation of the 2018/19 Municipal Infrastructure Grant (MIG). This represents a total spend of 69% against the original allocation of R503 646 000 00. 

In terms of the water service infrastructure grant (WSIG) allocation of R45 000 000, the total infrastructure allocation comes to R548 646 000, of which spending on the WSIG to date amounts to 63% of the allocation.

The approved 2019/20 medium-term revenue and expenditure framework (MTREF) is R1 748 766 000.

The revenue increased by 7% for 2019/20 financial year, compared to the 2018/19 adjustment budget, which was R1 632 599 581. Revenue is further projected to increase by 7% and 8% in each of the respective outer years of the MTREF.  The total major operating expenditure items for 2019/20 are employee-related costs, which equate to 57% of the total operating costs - far above the norm of 25% - 40% as per MFMA circular guideline. 

The operating expenditure for 2019/20 financial year has appropriated at R1 billion, compared to R955 million in the 2018/19 financial year, which translates to an increase of 8%. The capital budget of R705 million for 2019/20 is 5% more, compared to the 2018/19 adjustment capital budget of R677 million.

For the two outer years, the capital expenditure budget increased by 4% and 6% respectively.

Date:07 July 2019

By: Ndivhuwo Musetha

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