GT001 City of Johannesburg Adopted Budget 2010-11 Part D

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Annual budgets
and SDBIPs
Chapter 13
Chapter 13
Annual budgets and SDBIP
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Refer to the SDBIP, which is a separate document that is approved by Council.
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Legislation compliance
status
Chapter 14
Chapter 14
Legislation compliance status
The promulgation of the Municipal Finance Management Act (The Act) has brought in proficiency and control
measures to local government in terms of budgeting, monitoring and accounting on public funds. The Act has had
a profound effect on local government operations that required transformation in financial discipline and planning
processes. The budget preparation for 2009/10 – 2011/12 complies with most of these key requirements.
The Act has created clear reporting standards for local government that conforms to international standards. In
addition to providing for improved reporting by local government, the Act stipulates that new accounting and
financial standards must be complied with. The City’s electronic reporting to National Treasury has also been complied
with and has also improved over time. The monthly and quarterly returns to National Treasury have been submitted
on time.
The City of Johannesburg, in its strides to comply with the act, has in its plan of compliance instructed departments to
train all finance and non-finance officials from 2005. This has resulted in mass training programmes for officials in
all sectors, including the municipal entities. This massive training schedule was also boosted by the on-line training
provided by National treasury. Compliance on all critical elements of the Municipal Finance Management Act, for the
next and future financial years, will be achieved easily, due the fact that most, if not all officials, are aware of the Act.
In accordance with the provisions of the Act, the City has an approved Supply Chain Management policy, which was
extensively consulted on. The policy is intended at regulating the supply chain management environment within the
City. Required resources (human, financial and otherwise) have been allocated to the Supply Chain Management
department to enhance capacity to achieve the scorecards, as set out by the policy.
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The reform agenda, set out through the Municipal Finance Management Act, includes new accounting standards,
which includes national standards, such as Generally Recognised Accounting Practice (GRAP) and Generally Accepted
Municipal Accounting Practice (GAMAP). These above mentioned accounting practices have been adhered to during
the development of the budget.
The City’s consolidated financial statements were prepared to comply with GAMAP since the 2004/05 financial year.
The municipal entities financial statements were also prepared in line with GAAP.
When preparing the budget, the City has complied with the requirements of the MFMA Circular 28, which requires
that the budget content and format must comply with the Act. The following processes were adhered to:
• The budget is legally compliant;
• The process has a strong political oversight;
• Performance of officials should meet the required standard;
• The Growth and Development Strategy is reflected in the budget;
• There are clear linkages between the budget and the Mayoral Priorities, and
• Public participation was key when the City involved its stakeholders in the whole process.
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Resolutions
Chapter 15
Chapter 15
Resolutions
Operating Budget
It is recommended
1. That the operating revenue (including capital grants and internal transfers) of R31,0 billion and the operating
expenditure (including internal transfers) of R29,1 billion for the City of Johannesburg for the financial year
2010/11, and the indicatives for the projected medium term period 2011/12 and 2012/13 be approved as set out in
the following attachments:
1.1 The consolidated operating budget for the City as per Tables 1 – 10.
1.2 The consolidated operating budget for the City, Core Administration and Municipal Entities as reflected in
Annexure A, B and C.
1.3 The operating and revenue budget by vote for the City as reflected in Annexure D.
2. That the subsidies payable by Core Administration to the following Municipal Entities be approved: –
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Vote Budget Budget Estimate
2010/11 2011/12 2012/13
R’000 R’000 R’000
Pikitup 925 110 985 838 1 054 387
Johannesburg Roads Agency 429 693 461 780 495 434
Metrobus 291 841 305 771 321 261
Johannesburg City Parks 459 596 495 229 532 490
Johannesburg Zoo 40 370 42 860 46 051
Johannesburg Development Agency 21 637 22 892 24 198
Johannesburg Property Company – – –
Metro Trading Company 45 293 50 155 55 894
Johannesburg Tourism Company 31 616 33 434 35 611
Johannesburg Social and Housing Company 17 173 17 764 18 798
Johannesburg Civic Theatre 25 000 26 000 20 500
Roodepoort City Theatre 9 375 9 853 10 415
Total subsidies to ME’s 2 296 704 2 451 576 2 615 039
3. That the supporting information contained in the 2010/11 – 2012/13 Medium Term Revenue and Expenditure
Budget document as required in terms of Section 17(3) of the Municipal Finance Management Act (Act 56 of 2003)
be considered in conjunction with this report.
Capital Budget
It is recommended
1. That the annual capital budget of R3 058 761 000 for the year 2010/11 and the estimates for the two projected
outer years 2011/12 and 2012/13 for the City of Johannesburg be considered for consultation as set out in the
following schedules:
1.1 Capital budget by vote for each of the Municipal Entities and Core Administration as reflected in
Annexure A.
1.2 Capital budget by project for each of the Municipal Entities and Core Administration as reflected in
Annexure B.
Tariffs
It is recommended that the tariff charges for the 2010/11 budget year, as tabled in the Council agenda be approved.
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Detail budgets
per department
and municipal
entity
Chapter 16
Chapter 16
Detail budgets per department and municipal entity
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CORE ADMINISTRATION a
h
MEDIUM TERMOPERATING BUDGET2010/11-2012/13 C
Budgeted FinancialPerformance(revenueandexpenditure)
2010/11MediumTermRevenue& Expenditure
Description 2006/07 2007/08 2008/09 Current Year2009/10
Framework
Audited Audited Audited Adjusted Budget Year Budget Year +1 Budget Year +2
Rthousand OriginalBudget
Outcome Outcome Outcome Budget 2010/11 2011/12 2012/13
RevenueBy Source
Propertyrates 3072689 3462485 3409992 4106790 4126790 4769272 5146044 5542289
Propertyrates-penalties & collectioncharges 76242 48981 88035 95655 95655 101229 107202 113313
Servicecharges-electricityrevenue
Servicecharges-waterrevenue
Servicecharges-sanitationrevenue
Servicecharges-refuse 299092 516909 513400 513400 543177 575224 608012
Servicecharges-other 281969 131355 90687 182828 178155 193978 206476 219460
Rentalof facilitiesandequipment 81891 51123 127689 45540 60349 259304 63557 66318
Interestearned-externalinvestments 546274 502362 511123 310062 310062 170146 296142 333500
Interestearned-outstandingdebtors 1 15 3
Dividendsreceived
Fines 237818 373151 390508 461690 395812 342358 362656 483327
Licencesandpermits
Agencyservices 139113 147465 155463 161068 161068 171215 181317 191652
OperatingGrants 2667930 4006671 3611470 4149018 4153055 4320761 4396310 4529813
CapitalGrants 386298 135503 520537 890911 2321866 815186 2025745 1778771
Otherrevenue 438748 290653 117057 58738 92063 252032 266159 281952
Gainsondisposalof PPE 37774 371 14037 37000 37000 37000 37000 37000
Revenue 7966747 9449227 9553510 11012700 12445275 11975658 13663832 14185407
Interest Income(Sweeping Account)
InterestonLoans(Core) 600602 682597 719363 721273 712554 753787 783341 786563
InternalRecoveries(ME's ) 162567 149238 184035 177677 177677 219306 236131 250305
InternalRecoveries(Core) 135707 145743 183331 229676 229676 341176 358261 380189
InternalCapitalgrants(Mig) 205
Operatinggrants & Subsidies from(COJ)
Total InternalTransfers 899080 977578 1086729 1128626 1119907 1314269 1377733 1417057
TotalRevenue 9764907 10426806 10640239 12141326 13565182 13289927 15041565 15602464
ExpenditureByType
Employeerelatedcosts 1879149 2244292 2879432 3067327 3305972 3637779 3911595 4179841
Remunerationofcouncillors 58375 62337 68657 67349 74860 83953 109118 116647
Debtimpairment 307402 167051 751428 295383 346008 465085 537527 576216
Depreciation & assetimpairment 572966 401697 433883 817049 815849 911734 973792 999567
Financecharges 815904 729181 1061680 1238123 1300173 1398727 1504141 1523545
Bulkpurchases
Othermaterials
Contractedservices 698693 1020970 1047015 1054775 1217096 1160424 1167099 1245837
Grantsandsubsidies 119838 1434351 364390 385510 205354 123953 81649 86678
Otherexpenditure 1544143 1337513 1645622 1839002 1572826 1898334 1765633 1897841
Lossondisposalof PPE 24427 9518 18239
Expenditure 6020898 7406910 8270345 8764518 8838138 9679989 10050554 10626172
Interest(Sweeping Account)
Intereston ShareholdersLoans
InterestonMirrorConduitloans
InternalCharges(ME's) 272217 425696 401979 258236 279571 291512 399346 460906
InternalCharges(Core) 130869 145721 147969 229676 229676 341176 358261 380189
Operatinggrants & Subsidies toME's 1776559 1838437 2117496 2221645 2121344 2296704 2451576 2615039
Total InternalTransfers 2179645 2409854 2667444 2709557 2630591 2929392 3209183 3456134
Total Expenditure 10380188 9816764 10937789 11474075 11468729 12609381 13259737 14082306
Surplus/(Deficit) (615280) 610042 (297550) 667251 2096454 680546 1781828 1520158
Taxation
Surplus/(Deficit)aftertaxation (615280) 610042 (297550) 667251 2096454 680546 1781828 1520158
Attributable tominorities
Surplus/(Deficit)attributableto Example municipality (615280) 610042 (297550) 667251 2096454 680546 1781828 1520158
Shareofsurplus/(deficit)ofassociate
Surplus/(Deficit)fortheyear (615280) 610042 (297550) 667251 2096454 680546 1781828 1520158
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OpERating BudgEt
ECONOMIC DEVELOPMENT
MEDIUM TERMOPERATING BUDGET2010/11-2012/13
Budgeted FinancialPerformance(revenueandexpenditure)
2010/11MediumTermRevenue& Expenditure
Description 2006/07 2007/08 2008/09 Current Year2009/10
Framework
Audited Audited Audited Adjusted Budget Year Budget Year +1 Budget Year +2
Rthousand OriginalBudget
Outcome Outcome Outcome Budget 2010/11 2011/12 2012/13
RevenueBy Source
Propertyrates
Propertyrates-penalties & collectioncharges
Servicecharges-electricityrevenue
Servicecharges-waterrevenue
Servicecharges-sanitationrevenue
Servicecharges-refuse
Servicecharges-other
Rentalof facilitiesandequipment
Interestearned-externalinvestments
Interestearned-outstandingdebtors
Dividendsreceived
Fines
Licencesandpermits
Agencyservices
OperatingGrants 33049 29049
CapitalGrants 49049 20000 150236
Otherrevenue 5268 177 24
Gainsondisposalof PPE
Revenue 5268 177 49049 53073 179285
Interest Income(Sweeping Account)
InterestonLoans(Core)
InternalRecoveries(ME's )
InternalRecoveries(Core)
InternalCapitalgrants(Mig)
Operatinggrants & Subsidies from(COJ)
Total InternalTransfers
TotalRevenue 5268 177 49049 53073 179285
ExpenditureByType
Employeerelatedcosts 8153 15467 28794 48868 47068 32467 34997 37413
Remunerationofcouncillors
Debtimpairment 31
Depreciation & assetimpairment 670 573 888 8301 8301 4384 4507 4826
Financecharges 3
Bulkpurchases
Othermaterials
Contractedservices 11901 48077 46525 45874 47639 21477 20780 21965
Grantsandsubsidies 9810 9879 26288 25000 33864 64049 69824 74179
Otherexpenditure 3535 6810 8127 15435 9652 16081 16219 17026
Lossondisposalof PPE 5 33
Expenditure 34069 80842 110654 143478 146527 138458 146327 155409
Interest(Sweeping Account)
Intereston ShareholdersLoans
InterestonMirrorConduitloans
InternalCharges(ME's) 100 105 111
InternalCharges(Core) 982 177 1446 1446 659 716 769
Operatinggrants & Subsidies toME's 30000
Total InternalTransfers 982 30177 1446 1446 759 821 880
Total Expenditure 34069 81824 140831 144924 147973 139217 147148 156289
Surplus/(Deficit) (28801) (81824) (140654) (95875) (94900) 40068 (147148) (156289)
Taxation
Surplus/(Deficit)aftertaxation (28801) (81824) (140654) (95875) (94900) 40068 (147148) (156289)
Attributable tominorities
Surplus/(Deficit)attributableto Example municipality (28801) (81824) (140654) (95875) (94900) 40068 (147148) (156289)
Shareofsurplus/(deficit)ofassociate
Surplus/(Deficit)fortheyear (28801) (81824) (140654) (95875) (94900) 40068 (147148) (156289)
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ENVIRONMENT a
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MEDIUM TERMOPERATING BUDGET2010/11-2012/13
Budgeted FinancialPerformance(revenueandexpenditure)
2010/11MediumTermRevenue& Expenditure
Description 2006/07 2007/08 2008/09 Current Year2009/10
Framework
Audited Audited Audited Adjusted Budget Year Budget Year +1 Budget Year +2
Rthousand OriginalBudget
Outcome Outcome Outcome Budget 2010/11 2011/12 2012/13
RevenueBy Source
Propertyrates
Propertyrates-penalties & collectioncharges
Servicecharges-electricityrevenue
Servicecharges-waterrevenue
Servicecharges-sanitationrevenue
Servicecharges-refuse
Servicecharges-other
Rentalof facilitiesandequipment
Interestearned-externalinvestments
Interestearned-outstandingdebtors
Dividendsreceived
Fines 178 3 180
Licencesandpermits
Agencyservices
OperatingGrants 1704 6571 4395 13079 3000
CapitalGrants
Otherrevenue 34 30 1841
Gainsondisposalof PPE
Revenue 1916 6604 4575 14920 3000
Interest Income(Sweeping Account)
InterestonLoans(Core)
InternalRecoveries(ME's )
InternalRecoveries(Core)
InternalCapitalgrants(Mig)
Operatinggrants & Subsidies from(COJ)
Total InternalTransfers
TotalRevenue 1916 6604 4575 14920 3000
ExpenditureByType
Employeerelatedcosts 19870 25474 29873 29873 32412 34940 37351
Remunerationofcouncillors
Debtimpairment
Depreciation & assetimpairment 587 1127 1322 1322 1823 2005 2207
Financecharges
Bulkpurchases
Othermaterials
Contractedservices 8147 15004 5820 16129 5891 4900 5300
Grantsandsubsidies
Otherexpenditure 6350 5221 9268 6454 4845 5128 5301
Lossondisposalof PPE 17 173
Expenditure 34971 46999 46283 53778 44971 46973 50159
Interest(Sweeping Account)
Intereston ShareholdersLoans
InterestonMirrorConduitloans
InternalCharges(ME's)
InternalCharges(Core) 282 2151 741 741 807 858 912
Operatinggrants & Subsidies toME's
Total InternalTransfers 282 2151 741 741 807 858 912
Total Expenditure 35253 49150 47024 54519 45778 47831 51071
Surplus/(Deficit) (33337) (42546) (42449) (39599) (42778) (47831) (51071)
Taxation
Surplus/(Deficit)aftertaxation (33337) (42546) (42449) (39599) (42778) (47831) (51071)
Attributable tominorities
Surplus/(Deficit)attributableto Example municipality (33337) (42546) (42449) (39599) (42778) (47831) (51071)
Shareofsurplus/(deficit)ofassociate
Surplus/(Deficit)fortheyear (33337) (42546) (42449) (39599) (42778) (47831) (51071)
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