SELECT COMMITTEE ON FINANCE2016/17 FINANCIAL PEFORMANCE

CITY OF EKURHULENI

EXECUTIVE MAYOR: CLLR MZWANDILE MASINA2 AUGUST 2017

1

Table of contents

1 Contextual Background and strategic posture

1. Introduction

2. Build Environment Performance Plans

3. Financial Performance 2016/17

4. IDP 2016/17

THE SCOPE AND OBJECTIVE OF “PRO POOR”AGENDA

1.2 ANC Caucus -Short to Medium Term Goals1.3 EMM - 10-Point Economic Revival Plan

1. A clear roadmap for the effective implementation of the Aerotropolis Master Plan;

2

1.Introduction

3

ECONOMIC AND INVESTMENT STRATEGY | 4

1.1 Background

Highlights

City of Ekurhuleni (CoE) was

established in 2000

3,4 million people, 25% of Gauteng

population

The City has 9 towns, 17 townships,

119 informal settlements, 112 Wards

›17,000 employees

Moody’s grading Baa3/Aaa.za

.

4

13,5%

9,8% 8,9% 8,9% 8,1%

2,9%1,7% 1,5%

0,0%

4,0%

8,0%

12,0%

16,0%

Per

cen

tage

Economic Contribution per Metropolitan Municipality

90 823 89 296 81 488 77 442 73 774

58 951 73 946

-

20 000

40 000

60 000

80 000

100 000

GV

A p

er C

apit

a

GVA per Capita per Metropolitan Municipality

ECONOMIC AND INVESTMENT STRATEGY | 5

5

Ekurhuleni Growth and Development Strategy (GDS 2055)

1.2 Long term strategy for CoE (GDS2055)

1.3 Pro-Poor strategic posture

Pro Poor Agenda

• Ensure Improved, dependable and impactful service delivery to the communities,

• Accelerated service delivery that is responsive to the needs of the community.

• Poverty alleviation and measures to improve the living conditions of the most disadvantages residents / communities.

• Redressing the imbalances and inequalities in accessing of the resources among the Ekurhuleni residents‘.

• Prioritise and emphatically implement the Pro Poor Agenda

• broadened access to municipal services to the previously disadvantaged and maintained service levels invested in affluent areas

Socio Economic context

• Unemployment rate that sits at 28% of which 36% are young people.

• 15% of the population in Ekurhuleni has post-matric qualifications,

• The City need a University of Applied Science & Technology.

• 4% have no schooling at all.

• We have119 informal settlements accommodating not less than 600 000 people.

• High pregnancy rate amongst the youth, 100% of our further depends on them.6

1.4 Ekurhuleni 10 Point Economic Plan

Land A

vaila

bili

ty for

Str

ate

gic

Develo

pm

en

t

Manufa

ctu

ring R

evitaliz

ation

Economic Transformation,

Development & Growth

Enab

ling P

ublic

Tra

nsport

Syste

m

Public Private Partnerships

Aero

tropolis

Maste

rpla

n

Imp

lem

en

tatio

n

Acce

lera

tio

n o

f ID

Z/S

EZ

Pro

gra

mm

e

Supp

ort

SM

ME

s thro

ugh

Public

Pro

cure

ment

Imple

menta

tion o

f T

ow

nship

Econom

y S

trate

gy

Massiv

e Infr

astr

uctu

re

Investm

ent

Pro

mote

Localiz

ation &

Pro

duction

Skill

s &

Capabili

ty

Develo

pm

en

t

Domestic & Foreign Direct Investment

1.5 Immediate Priorities

A single city identity through branding and reviewing of the CoE corporate colours;

Repositioning and infrastructure re-arrangement to address fragmentation of the past;

Effective implementation of the mega-projects including Aerotropolis, Leeuwpoort, John Dube,

Balmoral, Glen Gory projects and prudent spending of Grants including USDG;

Evaluation of all legal cases currently being pursued, and introspection of our legal panel to assess

the success rate and the costs of legal fees thereof;

Review EPWP contracts (Lungile Mtshali and Clean City) to improve the outlook of our townships

through the rollout of legacy projects;

Accelerate Rapid Response initiatives through Siyaqhuba program;

Increased Rollout of payment points and profile the e-Siyakhokha platform;

Speedy recruitment of Vukuphile contractors;

Radical budget investment (R100m) towards bursary allocation with special focus on technical

courses;

Vetting of Staff in Supply Chain Management and critical positions, HODs and suppliers;

Introduction of quarterly reporting on fraud and corruption;

Establishing the Anti-Corruption and Fraud Prevention Commission

8

2. Build Environment Performance Plans (BEPP)

10

Informed by the long term vision of the Ekurhuleni Growth

and Development Strategy (GDS) 2055, the guiding

principles of Spatial Development Framework of the

Municipality and the CoE Capital Investment Framework

reflecting the CIF identified Priority Integration Areas.

In line with the Urban Network Strategy

Made provision for each integration Zone to include a

marginalised area, economic nodes (commercial and /

or industrial) and a network linkage (IRPTN).

Five integration zones identified

Integration Zones 1:Tembisa - Kempton Park

Integration Zones 2: Vosloorus - Boksburg -Bartlett

Integration Zones 3: Katlehong - Tokoza –Alberton -

Germiston

Integration Zones 4: Etwatwa – Daveyton –Benoni

Integration Zones 5: Duduza – Tsakane –KwaThema -

Boksburg

500m buffer area along IRPTN transport line.

2.2oijboitjbotjboio

2.1 Spatial Logic for 2016/17 BEPP

11

The Spatial Development Concept of the

Ekurhuleni MSDF speaks to the Gauteng City

Region in terms of:

Development of the major north-south

linkage/corridor (R21) through to ORTIA

Strengthening east –west linkages (N12 and

N17)

Strengthened corridor development will improve

linkages and emergence of new economic

nodes as envisioned in the Gauteng SDF

BEPP as a tool stimulates implementation of

the above aligned strategies

Built Environment

Performance Plan

Aligns to annual

budget process

National Treasury

2.2 BEPP Alignment with other Strategic Planning Frameworks

12

Build Environment Performance Plan (BEPP)

Refinement of the Integration Zones: Buffer area has been reduced and the mining belt has been

included into the Integration Zones

Alignment of the MSDF precincts with the CIF priority areas and Integration Zones.

Implementation of the CIF Capital Prioritization Model project prioritization weighting in accordance

with the CoE’s strategic objectives through the Capital Planning and Prioritization Platform (CP3).

Refinement of the Intergovernmental Pipeline of Projects through the (CP3).

Improved electronic data capturing as linked to the budget:

Ward Priorities

Mayoral Priorities

MSCOA segments

Capital project mapping against the IZs and GPAs

2.3 Key highlights of Spatial Planning and Development

Strategies

3.Financial Performance 2016/17

3.1 Operating results 2016/17

Details Total Budget 2016/17Results for Quarter 4 Results for Year-to-Date

Budget Actuals Budget Actuals

R R R R R

Total Income (34,238,421,606) (7,174,856,652) (7,507,886,948) (34,238,421,606) (33,078,916,234)

Total

Expenditure

34,221,649,063 8,543,192,835 8,976,964,871 34,221,649,063 32,254,953,699

Deficit /

(Surplus) (16,772,543) 1,368,336,183 1,469,077,923 (16,772,543) (823,962,535)

Gains & Losses

16,000,000 4,363,636 - 16,000,000 -

Nett Deficit /

(Surplus)

(772,543) 1,372,699,819 1,469,077,923 (772,543) (823,962,535)

The Total Income budgeted for the 4th quarter was R7.175 billion v/s actual income was R7.508 billion.

The Total Income budgeted for the 2016/17 Financial Year was R34.328 billion v/s actual income was R33.079 billion.

The Actual Income for the year was R1.249 billion (3.4%) less than budgeted.

The Total Expenditure budgeted for the 4th quarter was R8.543 billion v/s actual expenditure was R8.977 billion which is R434 million (5%) more than

budgeted.

3.2 Operating revenue 2016/17

15

Non-Exchange Revenue for the 4th quarter was budgeted at R2.187 billion and actual revenue

amounted to R2.383 billion – a deviation of 9% more than the budget.

Non-Exchange Revenue for the 2016/17 Financial Year was budgeted at R12.698 billion and

the actual revenue amounted to R12.086 billion – a deviation of 4.8% less than the budget.

The actual revenue from assessment rates for the 2016/17 Financial Year was R5.301 billion,

which is slightly more than the budgeted revenue of R5.299 billion.

Actual income from Transfer and Subsidies (Grants) realised for the 2016/17 Financial Year

was R578 million less than budgeted. It consists of Operational Monetary Grant (R5.139 billion

budgeted whilst R4.884 billion or 95% is realised) and Capital Monitory Grant (R1.825 billion

budgeted whilst R1.502 billion was realised).

3.2.1 Operating revenue highlights

16

Income from electricity services for the 4th quarter is reflecting a positive deviation of R20

million (0.7%) from the budgeted income. The deviation of 1.2% for the 2016/17 Financial Year is

a concern. The income budget was adjusted downward to compensate for the decline in

electricity sales due to alternative energy sources

The actual income from Waste Management for the 4th quarter is R91.7 million or 21.6% less

than budgeted. The results for the full 2016/17 Financial Year is slightly better with R90.4 million

or 6.4% less than budgeted

The budgeted income from water and sanitation for the 2016/17 Financial Year was R4.980

billion. The actual results is R4.662 billion which represents a negative deviation of R317 million

or 6.4%

3.2.1 Operating revenue highlights/…

17

.

3.3 Operating expenditure 2016/17

18

Budget Actual % of B Budget Actual % of B

R R R % R R %

METRO TOTAL

EXPENDITURE

Employee Related Costs 6,711,331,846 1,722,123,942 1,714,669,019 99.6% 6,711,331,846 6,613,047,575 98.5%

Remuneration of Councilors 126,781,174 32,082,296 30,548,717 95.2% 126,781,174 119,944,484 94.6%

Contracted Services 2,751,307,397 782,417,390 643,206,912 82.2% 2,751,307,397 2,128,846,922 77.4%

Operational Cost 1,451,167,076 (208,839,099) 539,774,244 -258.5% 1,451,167,076 1,763,269,130 121.5%

Inventory 5,003,542,404 1,320,979,064 1,467,943,831 111.1% 5,003,542,404 3,864,358,721 77.2%

Bulk Purchases 11,862,635,241 3,112,056,000 2,963,123,750 95.2% 11,862,635,241 11,691,390,368 98.6%

Interest Dividends and Rent on Land 663,333,125 202,679,930 161,174,657 79.5% 663,333,125 557,391,187 84.0%

Operating Leases 33,641,983 10,099,788 6,648,762 65.8% 33,641,983 24,567,055 73.0%

Contribution for Bad Debt 1,468,870,977 366,551,572 367,217,754 100.2% 1,468,870,977 1,468,871,016 100.0%

Transfers and Subsidies 506,078,896 224,077,130 246,483,904 110.0% 506,078,896 429,729,192 84.9%

- Operational: Monetary 506,078,896 224,077,130 246,483,904 110.0% 506,078,896 429,729,192 84.9%

Depreciation and Amortisation 1,805,346,054 538,055,101 497,162,613 92.4% 1,805,346,054 1,851,172,185 102.5%

Contra Accounts Revenue 1,837,612,890 440,909,720 339,010,707 76.9% 1,837,612,890 1,742,365,866 94.8%

TOTAL EXPENDITURE 34,221,649,063 8,543,192,835 8,976,964,871 105.1% 34,221,649,063 32,254,953,699 94.3%

DEFICIT / (SURPLUS) (16,772,543) 1,368,336,183 1,469,077,923 107.4% (16,772,543) (823,962,535) 4912.6%

TOTAL GAINS AND LOSSES 16,000,000 4,363,636 - 0.0% 16,000,000 - 0.0%

(772,543) 1,372,699,819 1,469,077,923 107.0% (772,543) (823,962,535) 106655.9%

QUARTER 4

DEFICIT / (SURPLUS) AFTER GAINS AND

LOSSES

DESCRIPTION

TOTAL BUDGET

2016/17

QUARTERLY RESULTS

YEAR-TO-DATE RESULTS

Total Expenditure budgeted for the 4th quarter was R8.543 billion. The actual expenditure was

R8.977 billion which is R434 million (5%) more than budgeted

Total Expenditure budgeted for the 2016/17 was R34.222 billion. The actual expenditure was

R32.255 billion which is R1.967 billion (5.7%) less than budgeted

The new SCOA framework does not accommodate the Repair and Maintenance as a type of

expenditure and category. These expenditure is embedded in the various categories of new SCOA

and form part of the outsourced services, contracted services, operational costs and Inventory

categories

Repairs and Maintenance budgeted amount for the 2016/17 Financial Year was R3.018 billion. The

actual expenditure amounted to R2.084 billion, resulting in an underspending of R934 million (i.e.

69% of the budget was spent). It is expected that this amount actual expenditure might still increase

during the finalisation of the financial year-end.

Due to the relative importance to monitor expenditure in this regard, repairs and maintenance

extracted from the various categories is reflected in the table below

3.3.1 Operating expenses highlights

19

.

3.3.1 Operating expenses highlights/…

20

Total budgeted amount on Employee Related Costs: the amount budgeted for the salaries and

contributions towards senior management and other municipal staff amounted to R6.711 billion The

actual expenditure for Employee Related Costs for the 2016/17 Financial Year is R98m less than the

budgeted expenditure, which represents a deviation of 1.5%

When the budget was compiled it was not certain when the local elections would take place.

Provision for Remuneration of Councillors was therefore made for the payment of 112 councillors for

the full financial year. As elections only took place on 3 August 2016, only 101 councillors had to be

paid for the month of July 2016. This resulted in a saving of 11 councillor’s remuneration for one month

Contracted Services relates to all expenditure incurred by Council which could/should have been

rendered by Council itself. It therefore includes;

Outsources services;

Consultants; and

Other Contracts.

Operational Costs refer to various types of expenditure which form part of the General Expenditure

category in the previous reports. The previous table details Departmental Operational

performance.

3.3.1 Operating expenses highlights/…

21

3.4 Capital expenditure 2016/17

22 NB: Detail of Capex Programmes per Cluster is in IDP Section, Capex target is over 90% for this year.

The unspent grants at the beginning of the 2016/17FY amounted to R433m.

In the 2nd Quarter Report it was reported that from the total unspent grants of R433m, an

amount of R345m was not approved for roll over. It was further reported that as at 31 December

2016 an amount of R323m was surrendered. A further amount of R22m was also surrendered in

March 2017.

The table below shows that the receipts for the Year-to-Date period at the end of the 4rd quarter

amounted to R6.861 billion (including fuel levy). The expenditure as at the end of the 4th quarter

was R6.426 billion which represents 92.47% spending. The total unspent funds (including

2015/16 unspent grants) at the end of June 2017 is R523.1 million. The unspent amount is

most likely to decrease as more invoices are paid before financial year closure.

3.4.1 Grant Performance

23

24

Vote balancing Name of Grant EMM Responsible Department

Unspent Funds -

15/16 Opening

Balances 16/17

Receipts for the

Month June'17

Surrenders to

National / Provincial

Treasury/Appropriati

on to revenue

Accumulated

Receipts for the

Financial year

Expenditure for

the Month June'17

Accumulated

Expenditure for

the Financial year

Balance

Available

Debtors at

June % Spent Risk

27547631030ZZZZZZZ16 FMG Finance - 1,050,000.00 64,758.00 (694,758.00) 355,242.00 - 66.17% 3

27547531010ZZZZZZZ16 Municipal Human Settlements Capacity Human Settlements 36,945,673.18 - (29,789,673.00) - 187,718.42 (7,125,174.22) 30,825.96 99.57% 1

TOTAL 36,945,673.18 - (29,789,673.00) 1,050,000.00 252,476.42 (7,819,932.22) 386,067.96 95.30%

-

19501172010113ZZZZ16 Equitale Share - Electricity Energy - - 398,214,775.00 - (398,214,775.00) - - 100.00% 1

64581172010113ZZZZ16 Equitable Share - Solid Waste Waste Management - - 475,058,809.00 - (475,058,809.00) - - 100.00% 1

68581172010113ZZZZ16 Equitable Share -Water and Wastewater Water & Sanitation - - 993,718,144.00 - (993,718,144.00) - - 100.00% 1

23981172010113ZZZZ16 Equitable Share - Finance Finance - - 514,375,271.00 - (514,375,271.00) - - 100.00% 1

239811720005DHZZZZ16 Fuel Levy - Finance Finance - - 1,625,872,000.00 - (1,625,872,000.00) - - 100.00% 1

TOTAL - - 4,007,238,999.00 - (4,007,238,999.00) - 100.00%

27547531070ZZZZZZZ16 USDG Human Settlements 291,205,074.16 - (291,205,074.16) 1,890,352,000.00 279,668,119.68 (1,573,340,798.91) 317,011,201.09 - 83.23% 3

27547531000ZZZZZZZ16 INEP Energy - - 40,000,000.00 11,344,924.71 (39,187,886.82) 812,113.18 - 97.97% 1

27547531040ZZZZZZZ16 PTNG Public Transport 22,085,434.59 - (22,085,434.59) 450,002,000.00 39,237,193.53 (345,720,093.94) 104,281,906.06 - 76.83% 3

27547531030ZZZZZZZ16 NDPG Human Settlements & City Planning - - 68,700,000.00 6,621,642.71 (33,197,515.59) 35,502,484.41 - 48.32% 3

2754716525DZZZZZZZ16 Electricity Demand Side Management Energy 191,512.87 - (191,512.87) 15,000,000.00 - (14,999,892.76) 107.24 - 100.00% 1

27665640340ZZZZZZZ16 Expanded Public Works Programme Economic Development - - 22,125,000.00 737,353.00 (21,947,473.00) 177,527.00 - 99.20% 1

27547531080ZZZZZZZ16 Intergrated City Development Human Settlements 1,560,298.83 - (1,560,298.83) 38,078,000.00 14,796,625.52 (24,224,882.59) 13,853,117.41 - 63.62% 3

27547531071ZZZZZZZ16 Wifi Connectivity roll out ICT 1,849,262.69 - - - 1,618,185.38 (1,618,185.38) 231,077.31 - 87.50% 1

TOTAL 316,891,583.14 - (315,042,320.45) 2,524,257,000.00 354,024,044.53 (2,054,236,728.99) 471,869,533.70 - 92.98%

27547622551ZZZZZZZ16 SETA Human Resources - - 9,024,725.83 702,034.18 (2,998,952.21) 6,025,773.62 - 33.23% 3

27547165258ZZZZZZZ16 BKB Environmental Resources Management 31,056.67 - - - (14,850.00) 16,206.67 - 47.82% 3

27547622552ZZZZZZZ16 Research and Technology Development Health & Social Development 184,663.75 - - 75,056.96 (184,663.75) - 100.00% 1

27547622051ZZZZZZZ16 HIV/AIDS Health & Social Development - - 12,719,535.00 995,520.00 (12,872,253.27) - (152,718.27) 101.20% 1

2754716525GZZZZZZZ16 Township Initiatives SRAC - Libraries 2,291,932.45 - (557,016.00) 13,000,000.00 2,741,918.87 (10,557,962.11) 4,176,954.34 - 71.65% 3

2754716525FZZZZZZZ16 HSDG Accreditation Human Settlements 69,379,389.44 - - 19,561,174.50 8,133,622.09 (48,319,179.41) 40,621,384.53 - 54.33% 3

2754716525HZZZZZZZ16 Disaster Grant Human Settlements 7,561,590.18 - - - (7,490,156.48) 71,433.70 - 99.06% 1

TOTAL 79,448,632.49 - (557,016.00) 54,305,435.33 12,648,152.10 (82,438,017.23) 50,911,752.86 (152,718.27) 153.38%

299011620505EQZZZZ16 Health Subsidies Health & Social Development - - 124,133,000.00 - (124,133,000.00) - - 100.00% 1

147811622508DEZZZZ16 Emergency Subsidies DEMS - - 150,624,000.00 - (150,624,000.00) - - 100.00% 1

TOTAL - - 274,757,000.00 - (274,757,000.00) - 100.00%

- - - - - - - -

TOTAL - - - - - - -

- - - - - - -

TOTAL - - - - - -

Total National / DORA Grants + Subsidies 353,837,256.32 - (344,831,993.45) 6,532,545,999.00 354,276,521.0 (6,069,295,660.21) 472,255,601.66 - 92.78%

Total Provincial Grants + Subsidies 79,448,632.49 - (557,016.00) 329,062,435.33 12,648,152.1 (357,195,017.23) 50,911,752.86 (152,718.27) 87.56%

Total Public Contributons + Foreign Grants - - - - - - - - -

GRAND TOTAL 433,285,888.81 - (345,389,009.45) 6,861,608,434.33 366,924,673.05 (6,426,490,677.44) 523,167,354.52 (152,718.27) 92.47%

PUBLIC CONTRIBUTIONS / FOREIGN GRANTS - CAPITAL

NATIONAL / DORA GRANTS - OPERATING

PROVINCIAL - SUBSIDIES

PROVINCIAL GRANTS - CAPITAL

PROVINCIAL GRANTS - OPERATING

Council approved the Adjustment Budget in January 2017 as required by the MFMA.

Since the approval of the Adjustment Budget the following factors affected the budget of Council and

will be captured in the AFS and Annual Report:

NDPG Grant (Neighbourhood Development Partnership Grant in the 2016/17 Capital

Budget). An additional R27,4m grant was allocated as per the extraordinary gazette dated 08

March 2017 to EMM and the funds were transferred on the 17 March 2017. The additional

amount was allocated to the City Planning department for the implementation of the NMT projects

in Daveyton, Duduza, Tsakane, Tembisa and Vosloorus

The amended Capital Budget is depicted below

3.4.2 Adjustment of Capital & Operations budget

25

.

3.4.3 Adjustment of Capital Budget

26

The Collection Rate for the 4rd quarter ended 30th June 2017 is 94.46% which is

slightly more than the target of 94.0% for the fourth quarter. In the previous financial

year, the collection rate for the same quarter was 90.01%.

The Actual Collection Rate over the past 4 quarters has increased as follows:(Quarter 1 – 89.29%; Quarter 2 – 91.96%; Quarter 3 – 92.94%; Quarter 4 – 94.46%)

The Accumulated Collection Rate for the 2016/17 financial year is 92.05% and is less

that the annual target of 94.0%

Measures will be instituted to increase the rate in the short to medium term.

Of the R13.330 billion outstanding debtors, R6.493 billion (48.8%) has been provided

for as bad debt, leaving R6.837 billion as collectable. The debt payable between 0-30

days is regarded as current debt which amounts to R1.671 billion. The nett effect implies

that R5.166 billion is in arrear and collectable.

3.5 Debtor analysis

27

.

3.5 Debtor analysis/…

28

As at end JUNE 2017

Debtors Age Analysis By Customer Group

Detail

0 -

30 Days

31 -

60 Days

61 -

90 Days

91 -

120 Days

121 -

150 Days

151 -

180 Days

181 Days -

1 Year

Over 1

Year Total

Organs of State 33,272,205.32 11,264,263.70 6,946,177.20 2,805,839.87 2,488,205.21 2,089,548.26 11,677,122.96 42,269,599.11 112,812,961.63

Municipal 119,500.26 163,077.80 75,546.87 214,580.87 13,725.56 604.58 16,477.57 61,488.59 665,002.10

Commercial 996,494,137.38 159,522,069.94 84,903,218.08 67,022,024.20 60,637,440.97 80,229,076.04 534,543,597.45 1,218,354,799.59 3,201,706,363.65

Households 634,004,948.74 295,407,102.49 292,959,409.73 332,600,012.71 226,547,212.69 192,831,441.29 1,414,462,738.31 6,457,112,060.10 9,845,924,926.06

Other 7,293,030.13 3,213,604.38 3,112,575.80 3,069,170.20 3,709,970.54 2,605,387.04 22,306,184.44 123,973,766.82 169,283,689.35

Total By Customer Group 1,671,183,821.83 469,570,118.31 387,996,927.68 405,711,627.85 293,396,554.97 277,756,057.21 1,983,006,120.73 7,841,771,714.21 13,330,392,942.79

3.5 Debtor analysis/…

Eskom Supply EMM Supply Total

July 2016 12.13% 93.61% 87.01%

August 2016 11.28% 92.27% 87.54%

September 2016 17.06% 96.66% 92.68%

October 2016 16.20% 94.21% 90.28%

November 2016 30.50% 99.15% 95.24%

December 2016 20.33% 94.70% 90.73%

January 2017 23.04% 93.91% 89.81%

February 2017 18.82% 94.78% 90.23%

March 2017 29.12% 103.69% 98.72%

April 2017 15.75% 92.66% 87.87%

May 2017 28.90% 101.02% 97.26%

June 2017 32.97% 101.96% 98.26%

One of the biggest challenges that Council is facing is the limited credit control measures in areas

where Eskom is supplying electricity. Council cannot disconnect the electricity of defaulters. The

Energy Department is in consultation with Eskom to address the matter

The statistical information for the 12-month period of the 2016/17FY ended 30th June 2017 as

extracted from the financial system reflects a payment rate of 85.79% for invoices/ statements

that were received and paid within 30 days, 10% in 60 days and the rest in 90 days.

3.6 Creditors

30

.

3.7 Investment Portfolio and Cash on Hand

31

ACTUAL 2016/17 ACTUAL 2016/17 ACTUAL 2016/17

Apr-17 May-17 Jun-17

R R R

Investments 1,328,579,108.90 1,421,299,415.90 1,464,256,194.90

Nedbank Short Term 1,018,495,890.41 1,018,495,890.41 1,025,120,843.95

Land Bank Short Term 40,489,126.36 40,735,388.99

Bank Balances 6,287,864,759.14 5,460,754,940.93 4,303,744,989.56

Petty Cash

TOTAL CASH AND INVESTMENTS 8,634,939,758.45 7,941,039,373.60 6,833,857,417.40

Less Encumbered Cash:

1. Encumbered Investments and

Investments in ME's (Sinking Fund) 1,177,421,067 1,170,274,643 1,203,328,218

2. Dedicated bank accounts (grants

and capex and Capital Replacement

Reserve)) 617,888,396 227,117,747 (547,886,305)

a. Unspent Grants 1,158,773,860.58 889,939,309.30 523,167,354.52

b. Unspent Loans (as from Capex

sheet) (540,885,464) (662,821,562) (1,071,053,660)

c. Capital Replacement Reserve

TOTAL OPERATING CASH 6,839,630,295 6,543,646,984 6,178,415,504.15

3. Less funding of balance sheet as

per EMM Policy

a. Consumer Deposits @ 50% 404,239,429 405,240,864 409,304,219

b. Loan Redemption Costs for the year 361,074,769 361,074,769 361,074,769

c. Provisions (as per policy) 1,341,279,046 1,341,279,046 1,341,279,046

- COID 24,606,470 24,606,470 24,606,470

- Leave Provision 340,320,961 340,320,961 340,320,961

- Bonus Provision 67,672,160 67,672,160 67,672,160

- Landfill Rehabilitation 347,959,750 347,959,750 347,959,750

- WCA 12,490,935 12,490,935 12,490,935

- Long Service Awards 415,833,811 415,833,811 415,833,811

- GMRF 132,394,959 132,394,959 132,394,959

TOTAL UNENCUMBERED CASH 4,733,037,052 4,436,052,305 4,066,757,471

Number of day's total cash held (un-encumbered cash)56 52 48

Cash Expenditure per year 31,062,984,981 31,062,984,981 31,062,984,981

Cash Expenditure per month 2,588,582,082 2,588,582,082 2,588,582,082

Cash Expenditure per day 85,104,068 85,104,068 85,104,068

With regard to the

Cash and

Investment

Position a cash

target of 55 days

has been set in

the SDBIP for the

2016/17FY.

4.IDP 2016/17

32

Section 34 of the Municipal System Act prescribes annual review and amendment of the IDP in

accordance with certain processes. Section 29 (1) (b) of Chapter 5 of the Municipal Systems Act of 2000

states that municipalities, through appropriate mechanisms, processes and procedures established in

terms of public participation; allow for communities to be consulted on their development needs and

priorities; and the local community should participate in the drafting of the IDP.

The CoE uses the ward committees as a mechanism for the purpose of engaging and consulting

communities on their needs and priorities. The IDP review meetings were held in all 20 Customer Care

Centres (CCCs) with 101 ward (now 112) committees. These meetings took place between the 8 and 17

September 2015 and reviews in April 2016. When the new administration took office in August 2016, they

made a few changes and adopted the IDP.

4.1 IDP Process and Ward needs

33

170

92

53 43 35 31 24 17

0

50

100

150

200

Roads SRAC HS Health Energy Environment Water Transport

IDP Ward Needs 16/17

4.2 IDP/SDBIP: Budget 2016/17

Capital Budget breakdown

Economic development R 1,570,889,000

Upgrading & renewal R 2,044,696,075

Urban restructuring R 1,515,378,362

R 5,130,961,437

.

34

31%

40%

30%

Capital Budget 2016/17

Economic Development

Upgrading and Renewal

Urban Restructuring

ECONOMIC AND INVESTMENT STRATEGY | 35

4.3 Social Cluster : Achievements 2016/17

Launched the e-verification process for the indigent

households.

A variety of health awareness campaign were done

focusing on (HIV/AIDS, STI’s, TB, Birth Control, etc.)

1,4m people were reached; reduction of mother-to

child HIV infection to 1,22% from 1,4%.

Monitoring of 350 centers & 10,000 children was done.

launched 21 chronic medication pick-up points in our

communities – a move that will reduce queues at our

clinics and bring the medication to the doorstep of those

who need it the most.

729 Peace corps converted to Traffic Wardens,

construction of dog unit (R4,2m), construction of 4

Precincts in different stages (R12,1m spent so far)

& special vehicles/equipment for R49,8m).

729 Peace corps converted to Traffic Wardens,

construction of dog unit (R4,2m), construction of 4

Precincts in different stages (R12,1m spent so far) &

special vehicles/equipment for R49,8m).

Six clinics were completed this year R36m was

spent; R19,9m was spend on 3 ECD’s in different

stages of construction and for upgrading of

facilities R155,5m was spent.

3

5

4.4 Infrastructure Cluster: Achievements 2016/17

Pro-Active Fire Safety Service was provided to 151

schools, 296 events were conducted and 39,814

people attended.

Installation of 20,826 Photovoltaic lighting units in six

informal settlements, 1265 Street lights, electrified 6,092

more subsidised houses

Increase alternative power through Solar and other

renewable sources adding 2,55 MW.

A total of 5 townships were regularized and a total of

7,025 Ha of dolomitic land was unlocked for development.

2,506 stands are now full-serviced in 8 townships &

refurbishment of 4 hostels was done.

Two libraries were build for R6,9m; one Art/Culture

facility for R22.9m; 11,988 kids between 3-6 yrs.' are

in ECD centers and upgrading of SRAC facilities &

new pools/tennis courts/library upgrades R68.7m.

IRPTN (Harambe) running behind and R412m spent & for

taxi rank upgrade & new ranks R25m was spent;

Licensing centers and refurbishment R17.8 was spent.

R31,6 m was spent on 3 New Customers Service Centres & R20,5m

spent for upgrading of 3 Customer Service Centres.

R45,5m was spent on 7 new fire stations in different stages, R13,4m

spent on refurbishment of 4 fire stations & R33,1m for

vehicles/emergency vehicles.

R48m spent on installation of lights, R69m electrical network

enhancement, R205m for informal settlement electrification, R203

for renewal/upgrade of substations, R30m renewable energy

Six township entrances were upgraded for R5,5m; upgrade &

development of parks/cemeteries & wetlands for R55,5m.

Out of R710m Capex budget R 490m spent for various housing projects

in different stages.

80km v/s 107km planned was surfaced ; 15km resurfaced v/s 20km;

10698 storm water structures for a total of R467m v/s R645m budget.

Delivery of 240l bins to 95,645 households were delivered at R3m;

R65m for upgrade of dumbing sites and R39m for specialised

vehicles/equipment.

Additional 20Mlitres storage capacity for R80m; R8,6million for water

meters; R104m for sewer and water pipe networks, R170m for mobile

toilets

36

4.5 Economic Development Cluster: Achievement

Precincts plans for Germiston & Kempton Park

completed.

Feasibility study for Applied Science & Technology

University completed.

A consultant was appointed to do a feasibility study for

Innovation Hub in CoE, so far R4,3m was spent.

27 businesses were part of Fab-labs Carpentry Training

programme.

10 SMME’s are in the Competitive bidding

programme and 90 businesses are in General

Business Mentorship (Vukuphile).

31 SMME’s for people with disability in partnership with

PRASA are in Mentorship Programme.

10,000 unemployed youth were targeted for IT &

Digital Technologies initiatives through a variety of

programmes, 231 youth are in Graduate

Programmes as Interns in partnership with business

Productivity Improvement programme in Manufacturing

industry is underway, 530 benefited from workshops

R 23 million was spent to rehabilitate sink holes.

The bursary scheme was increased from R 10m to R100m, 511

bursaries were awarded out of 3,156 applicants.

R9,1m was spent on Fabrication Laboratories.

R3,3m was spent for Automotive Centres in Katlehong, Tembisa and

Tsakane so far, total budget for these Automobile Certified Centres

in R6m in total once complete.

Other township economic initiatives include skills centre

(R3,4m spent v/s R4m budget), Ekurhuleni Music Studio &

Ekurhuleni Radio, (so far R1,5m spent v/s R3m budget) and

Tourism Nodes/Hospitality School/Enterprise Hubs/Industrial

Park/Agriculture/Lake so far R82,8m v/s R104,4m)

R22,3m was spent on rehabilitation of Springs Market.

R 5,1m spent on specialized equipment & tourism management

programme.

37

4.6 Governance Cluster: Achievements 2016/17

Full operationalization of 7 established Municipal Courts to

fast track By-Law infringements.

Launched Mayoral Service Delivery Programme

“Siyaqhuba” to accelerate service delivery & visit all wards

by MMC’s and Snr Managers every Friday weekly.

Single brand identity achieved and City of Ekurhuleni now

gazetted.

Establishment of Commission on investigations on Fraud &

Corruption.

Introduction of stage gate tracking for planning & Capex

War Room to assess Capex performance as well as getting

panel of service provider.

mSCOA live on 1 July 2017, ERP Programme on track.

Holistic salary scale review was done for C1-C14, only two

Snr Management positions are vacant 84% of critical posts

filled and vetting/screening of Snr Managers is on track.

Grant-in-Aid was increased from R20m to R100m (40%

for economic initiatives, 40% for arts, culture and 20%

for social development).

R2,8 billion (23,8%) of work awarded to Females; R5,1

billion (43,5%) to HDI; R1,6 billion (13,3%) to youth.

9 Workshops were refurbished for R8,7m & R6m spent

for fuel/fleet management systems.

1400km of fibre installed for R43m; 2500 Wi-Fi hotspots

(R30m); ERP system is on track R186m spent so far.

Six out of nine City properties were refurbished at

R65m; and R331m spent on Land and building

acquisitions.

Quality of Life Survey, CoE 2030 SIP ready for

presentation, Knowledge Management Policy are ready.

38

Improve service delivery through visible and impactful programmes supported by Capex spending;

Electrification of all informal settlements;

Construction of 100 000 housing units;

Provision of 59 000 serviced stands;

Make informal settlements more habitable through up-scaling of services;

Improve on township economic issues;

Promote preservation of water usage and continue investing in water infrastructure to ensure security of supply;

Reduce 1:10 ratio for toilets to 1:5;

Strongly pursue the issue of an Ekurhuleni University;

Establish a commission to fight Fraud and Corruption;

Ekurhuleni Power Station to broaden accessibility and ensure security of supply;

Building capacity to minimize outsourcing of key Municipal Services;

Increase the number of local clinics piloting the 24-hour health care programme;

Accelerate Wi-Fi rollout; and

Create a signature mega arts and culture festival for the city.

4.7 City of Ekurhuleni Plans for the 5-year Term

39

Thank You, for your time.

40