After the City of Tshwane was slated by opposition parties in council for its culture of underspending, it has clarified that it had spent more than 90% of its capital budget for the financial year which ended on June 30, 2024.
The criticisms by the opposition parties stemmed from a council report on the spending of its allocations by March this year.
The report in question noted that the National Treasury had slashed its R5 billion conditional grants by R346 million because of underspending of its capital budget at the time.
“The total adjusted operating transfers and grants amounts to R5,0 bn and the total capital transfers and grants amounts to R1,8 bn, reflecting a decrease of R346m because of fiscal reduction implemented by the National Treasury,” the report said.
ANC councillor Floyd Thema noted that the public transport network grant to the City was adjusted to R567.8m, but an amount of R261.7m remained unspent.
He said of the R47m allocated to the City for programme preparation support grant, only R5.3m was spent.
The City, he said, only spent R8m of a staggering R132.2m allocated for neighbourhood development partnership grant, which “might help communities with employment created to safeguard their neighbourhoods”.
“Community libraries and this is where the DA and ActionSA should be shining yet they are failing to provide a capacity and actually also to assist in libraries in township areas with resources especially whether with books, computers, Wifi and printing machines,” Thema said.
The EFF also said it was dismayed by the underutilisation of funds in the municipality.
Party councillor Trevor Moloisane said: “This relentless underspending has led to catastrophic consequences including the national treasury decision to slash R346m and withhold an additional R70m from our budget.”
He said the Gauteng government allocated an equitable share grant for HIV/Aids programme amounting to R26.m and yet a paltry R6.2m had been utilised.
In a media statement, the City said the report tabled in council showed its capital budget spending stood at 73% as of the end of March 2024, which “was misconstrued by some sections of the media to mean that the city has struggled to spend its grant and subsidy funds for the financial year, which ends on June 30, 2024”.
“The report stated that the city had underspent its grants and subsidies funds by R1,5 billion by March 31, 2024, however, the report did not incorporate expenditure incurred in the fourth quarter – from April to June 2024,” the City said.
The statement added that the financial year of the municipalities ended at the end of June and the new financial year started in July. The report tabled in Council yesterday only covered the period until March 31, 2024.
“The actual expenditure on the capital budget as of June 28, 2024 is R1,6 billion, or 83,5% of the total adjusted budget of R2 billion. The total expenditure, including commitments (funds where purchase orders have been issued and awaiting delivery), is R1,8 billion, which translates to 92,9%,”the City said.
It added that expenditure on the capital budget started slowly from the beginning of the current financial year due to tighter controls that had been implemented to ensure better value, fix the financial leaks and comply with the findings of the Auditor-General.
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