Cape Town mid-term budget prioritises World Cup transport

There will be no adjustment to rates and tariffs in the current financial year, the City of Cape Town announced during its mid-term adjustments budget.

Mayco member for finance Ian Neilson said at a special meeting of the mayoral committee yesterday that the city had set an "own record" in capital expenditure for the first half of a financial year by implementing 39 percent of its plans for 2009/10, at a cost of R2.2 billion.

"This indicates that the council is strongly on the path to delivering its capital budget for the coming year," said Neilson.

At the same time last year, the city had spent 38 percent (R1.95bn) of its budget, up from less than 30 percent in previous years.

Neilson said there would be no adjustment to rates and tariffs in this financial year.

The reshuffled budget provides an update on project implementation programmes. It also incorporates approved additional funding of R292 million for the provision of basic transport requirements for the World Cup.

The city says its rapid asset implementation in the past two financial years necessitated a review of its three-year capital investment programme.

It is in negotiations to buy land and a servitude right-of-way in the Blaauwberg conservation area. There was R8.3m available for the project, but top-up funding was needed.

Neilson said the city had for many years negotiated with owners to buy property adjoining municipal land so it could extend the conservation area. These negotiations had come to fruition.

The additional funding for the land would come from surpluses realised in the current financial year or from sales of city-owned land.

On the operations side, Neilson said things were "on track", although income and expenditure were "a bit below" budget.

The adjustments budget includes a downward adjustment to the budgeted collection ratio for water sales. All consumers were buying less water from the city, especially industrial and commercial users, because of the economic climate.

Other adjustments included the R116m not spent on filling vacancies. This is expected to absorb the effect of the final wage increase for municipal workers.

A proposed R55m arrears write-off by the housing department is not expected to affect the budget as it is being offset against the housing provision for bad debts.

Other expenditure amendments included:

# R20m for operating costs related to xenophobia.

# R30m additional allocation for the bus rapid transit project.

# R5.8m for the establishment of new city improvement districts.

# R41.9m for vaccines and antiretroviral and tuberculosis programmes.

The director for service delivery integration and 2010 project head, Mike Marsden, gave details of the proposed tariffs for users of the airport-CBD and inner-city loop transport services.

The fare proposed for the airport service is R50, and for the inner-city service R8. Assuming a 50 percent occupancy, the services' revenue is estimated at R5.48m.

Cape Argus

Posted at 10:02AM Jan 22, 2010 by Editor in Market  |  Comments[2]