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BUDGET BROCHURE

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BUDGET BROCHURE Powered By Docstoc
					              DURBAN
                   CHAMPIONING THE INDIGENT
                                              MANAGING
                                                PUBLIC
                MAXIMISING SERVICE DELIVERY
 CREATING HIGH-QUALITY LIVING ENVIRONMENTS      FUNDS
DRIVING INVESTMENT IN PUBLIC INFRASTRUCTURE
                                              PRUDENTLY




                 A PREVIEW OF THE 2008/2009
                     MUNICIPAL BUDGET
CONTENTS
 FOREWORD FROM THE LEADERSHIP
 AN INCLUSIVE BUDGET
 WINNING BECAUSE WE DELIVER
                                      WE CARE, WE BELONG, WE SERVE
 A LONG-TERM VISION
 A COMPLEX OPERATING BUDGET
 GOING BEYOND OUR MANDATE
 PLATFORM INFRASTRUCTURE
 PROVIDING RESOURCES
 SUPPORTING OUR COMMUNITIES
 A DIVERSE RANGE OF LINE SERVICES
 KEEPING TARIFFS REALISTIC
 A SIGNIFICANT CAPITAL BUDGET
 MANAGING LEGISLATIVE CHANGE
 A GOOD FINANCIAL RECORD
 COMPARING WITH OUR COUNTERPARTS
 UNQUALIFIED FINANCIAL STATEMENTS
 STIMULATING THE ECONOMY
 READINESS FOR 2010
 MEASURING THE ECONOMY
 INVESTMENT IN THE CITY
 CARING FOR ALL OUR CITIZENS
 PROVEN CAPABILITIES
 THE BUILDING-BLOCKS FOR SUCCESS
 A METRO THAT IS OPEN TO DISCUSSION
FOREWORD FROM THE LEADERSHIP
There are a number of interventions that government, at all levels, has introduced to      Year-on-year, the challenges faced by metropolitan authorities in South Africa
better the lives of the poor and disabled. Recently, the national Minister of Finance      becomes increasingly more complex. Cities are seen as havens for jobs, better
lessened their financial burden by increasing their grants. We have incorporated this      livelihoods, access to superior public infrastructure and business opportunities by
principle into our 2008/2009 budget. Some 108000 households will be exempt from            rural communities. Yet, it is cities that face the biggest hurdles with this population
paying rates as opposed to the 72000 households previously. Further, government            migration. The need for services increases dramatically, placing great strains on
subsidises these households in respect of free basic services. About 227000 (55%)          already-stretched municipal budgets. With this rise in city populations, there is little
of households will receive a reduction in rates. Properties valued less than R400000       corresponding increases in terms of income for the Municipality. Revenue
according to the latest property valuations will be exempt from rates if those             increases from rates and our trading services like water and electricity are quite
households are headed up by children or pensioners. Higher-valued properties               rightly capped within acceptable national limits. Thus, our challenges as a metro
owned by this demographic will have rates levied on the portion that exceeds               are immense. The demands created by basic human needs are high, straining the
R400000. This consideration has also been extended to those who are boarded on             resources of a low-growth base in real terms. Into our ninth year of the new
medical grounds or receive government disability grants, allowing for a more               millennium, many indigent people still do not have access to acceptable housing,
equitable and effective system of taxation.                                                water supply, sanitation and electricity. It is within these limiting financial constraints
Our Long-Term Development Framework (LTDF) clearly maps out the strategy for               that eThekwini continues to provide a vast array of public services including:
the City over the next twenty years. In an effort to achieve our 2020 vision, the LTDF     housing, transport, water, sanitation, roads, security, refuse removal, emergency
details the complex development priorities facing us. The essence of the LTDF is to        services, libraries, clinics, social services, economic infrastructure and even
achieve a balance between meeting basic needs, strengthening the economy,                  opportunities to local SMME’s. Concomitantly, our budgets are developed with a
developing people skills, and creating a technology base for the future. In an effort to   specific pro-poor focus.
achieve our 2020 vision, these four Strategic Focus Areas of intervention need to be       At the same time, we are committed to enhancing our enabling environment to
balanced and integrated. It is mandatory that the City’s budget be a pro-growth one        support business and attract investment. Accordingly, we have created the relevant
that meets basic needs and builds on existing skills and technology.                       platform infrastructure over the years as well as increased bulk services for
We will continue to balance the requirements of having a pro-poor budget whilst            business to utilise or access. Further to this, we have a significant capital
funding infrastructure that facilitates the creation of a strong economy.                  expenditure spend of over R50 billion projected over the next ten years. In addition,
                                                                                           for the 2008/2009 financial year, the repairs and maintenance portion of the budget
MR. OBED MLABA                                                                             is 10.8%, which is well above the norm for any other local metro.
MAYOR                                                                                      As promised in our inaugural brochure last year, we endeavour to provide an
                                                                                           annual update on our budget and its related processes. Every year, we will choose
                                                                                           a specific aspect of our budget to highlight. Due to the current discussions around
                                                                                           the new Municipal Property Rates Act (MPRA), which comes into operation in the
                                                                                           2008/2009 financial year, we will focus on providing some background information
                                                                                           on the Act and its implications for the Municipality and the ratepayers of Durban. As
                                                                                           expected, misinformation has circulated, creating dissent about the re-assessment
                                                                                           of properties from certain quarters. As we have been reiterating, this process will
                                                                                           provide market parity in evaluations within the city.
                                                                                           eThekwini is a complex organisation as can be gleaned by the services we provide,
                                                                                           in addition to us managing a R23 billion budget, and with over 18000 workers in our
                                                                                           employ. Our budget process is consultative and our strategic intent in terms of the
                                                                                           Integrated Development Plan (IDP) is developed with all our stakeholders. Thus,
                                                                                           despite the sometimes overwhelming impediments that face us in making Durban
                                                                                           the most liveable city in Africa, we always strive to create solutions that benefits all
                                                                                           our citizens.

                                                                                           DR. MICHAEL SUTCLIFFE                                              MR. KRISH KUMAR
                                                                                           CITY MANAGER                                                       CITY TREASURER
AN INCLUSIVE BUDGET
  The creation of our municipal budget is a consultative process. As this entails the management of council funds, we liaise with civil
  society and business. The budget is developed within the framework of the Municipal Finance Management Act. Added to this, it
  must align with the City’s Integrated Development Plan (IDP). Below is a description of the process.

     September            October            November           December             January          February             March                April              May

   • Process          • Draft tariff      • EXCO              • Council           • Operating      • Finalisation of   • Presentation      • Public           • Service
     begins with        estimate            (Council’s          approval of         Budget           tariff              of Budgets to       hearings on        Delivery
     assessment of      report              Executive           Capital             review.          estimates and       Business.           Budgets.           Budget
     the previous       commences.          Committee)          Budget.           • Presentation     rates             • Proposed          • Regional           Implementatio
     year’s           • Draft Capital       discusses the     • Draft               of revised       increases.          increases           hearings on        n Plan
     Budgets.           Budget is           proposed tariff     Operating           Operating                            tabled at           Budgets.           (SDBIP)
   • Development       developed.           increases and       Budget is           Budget to                            Council by the    • Approval of        finalised.
     of the first     • Draft               lifeline            presented to        EXCO and                             Mayor.              final Budgets
     draft Budgets.     Operating           policies.           Council.            Council.                                                 by EXCO and
   • Review of          Budget is                                                                                                            the rest of
     IDP.              developed.                                                                                                            Council.




                Refinement of Operating Budget at
                          Each Stage
                                                                                                                                           CIVIL
In compliance with the Municipal Structures Act (1998) and Municipal Financial                                                            SOCIETY
Management Act (2003), our city budget is informed and aligned to the IDP objectives.
The IDP determines and prioritises the needs of the community. The budgetary
allocations for both the capital and operating expenditure are undertaken in a manner that
                                                                                                                                                             LEGISLATION
will not only ensure that our IDP outcomes are achieved but also to ensure that our city’s               ADMINISTRATION                   BUDGET
2020 vision is realised.
We have come a long way in capital budgeting, away from departmental budgeting.
Currently the capital budget is allocated according to the IDP eight-point plan. During the
2008/09 IDP revision process, this allocation process was further entrenched through                                                      BUSINESS
committing to make hard choices. In terms of the operating budget we have made an
excellent start but are now more committed than ever to ensure that critical operating
budget resources are prioritised in terms of stated IDP outcomes.                             THE BUDGET IS AN INTEGRATED PRODUCT DEVELOPED
More importantly, the Performance Management System (PMS) allows the municipality an                WITH INPUT FROM MAJOR STAKEHOLDERS
opportunity to monitor and evaluate individual and organisational performance in meeting
our IDP outcomes and vision.
WINNING BECAUSE WE DELIVER
  DID YOU KNOW THAT WE?
  •Delivered of 75000 housing units during the five year period 2002-2007.
  •Provided 6kl of free basic water per month to 965480 households (including apartments) in 2007.
  •Extended water and sanitation (new service) to 18000 households per annum
  •Constructed 32km of new roads, 165km of sidewalks, 201km of gravel to ‘black-top’ roads and
   33 pedestrian bridges 2002-2007.
  •Extended refuse-removal (new service) to 159000 households per annum during the five year
    period 2000-2005.
  •Provided 155188 new electricity connections 1997-2007 and built 15 new major sub-stations
    2003-2007.


The Municipality kept its winning ways throughout 2007. Some of the achievements being: -

 Winner of         Best          United         Diamond           SAICE         Silver Gilt   Professional     Award for
  the Vuna      Municipality    Nations      Arrow Award      Golden Arrow       Award –      Management        technical
Awards for      in Africa –      Public        for bringing   award for the      Chelsea        Review       excellence for
  being the      Afriglobe      Service      investment to      Marianhill    Flower Show.     Award for     the Umhlanga
     best        Awards.        Award –       the Province       Landfill                        most         Rocks Pier.
performing                       Water           (DIPA).      Conservancy                      Proactive
   Metro in                     services                         project                        Mayor.
the country                    debt relief                      Silver Gilt
  (financial                   scheme.                           Award –
  viability),                                                    Chelsea
for the third                                                 Flower Show.
 consecutiv
    e year.
 A LONG-TERM VISION
        INTEGRATED
                                                                          CITIZENS LIVING IN HARMONY.
                                                                                                                                                      OUR IDP
        DEVELOPMEN                                                                                                                                    VISION
                                                                          A CARING CITY.
           T PLAN
                                                                          A CITY THAT WE ARE PROUD OF.




                                        Financial                                                                              Sustaining Our                     Support
                      Economic                              Safe, Healthy
  Quality Living                         Viability                                   Good              Embracing Our             Built and      Empowering Our    Services
                     Development                             and Secure
  Environments:                            and                                     Governance:        Cultural Diversity:         Natural          Citizens:        and
                   and Job Creation:                        Environments:
                                        Stability:                                                                              Environment:                       Other:


R 15 191 422 960 R 3 896 404 910 R 1 676 437 225           R 992 223 561          R 780 798 095          R 343 322 820         R 223 680 969     R 148 484 220   R 147 136 000
                                       The above pillars serve as the core guides in the design of our operating and capital
                                                                     budgets for 2008/2009.
A COMPLEX OPERATING BUDGET
                                                                   KEY ISSUES
                                             RATES AND GENERAL
                                             •Salary increase of 8.75%.
                                             •Provision for critical vacancies – R80 million (includes 200 Trainee
                                              Constables, Fire Safety, IT, Health, Skills, Municipal Court, and
                                              Planning & Development Staff.
                                             •Interest on loans increased due to additional loans from DBSA
                                              being taken (R35m).
                                             •Provision for Bad Debts (Increased by R200m).
                                             •Additional Repairs and Maintenance (R157.9 million).
                                             •95% collection rate.


                                             WATER
                                             •Bulk purchases tariff increase – 2% .
                                             •Provision for Bad Debts – R107 million.
                                             •Salary increase of 8.75%.
                                             •Impact of Capital Projects (R1040.7m) on operating, e.g.. Western
                                              Aqueduct (R250m), Replacement of pipes (R100m).
                                             •Water loss is currently at 36%, targeting 30% for 2008/09. (9% of
                                              the 36% represents leakage from mains and this is being
                                              addressed through the AC mains replacement project.)
                                             •95% collection rate.


                                             ELECTRICITY
                                             •Eskom bulk purchase tariff increase – 15.2%.
                                             •Salary increase of 8.75% and recruitment of skilled professionals.
                                             •Provision for Bad Debts increased by R20m
                                             •Rollout of Infrastructure to new areas / developments
                                             •No provision for REDS implementation
                                             •Levy of 2 cents per kwh. An additional R228.5m will be levied to
                                              consumers on behalf of SARS.
                                             •98% collection rate.
 TOTAL OPERATING BUDGET = R17.470 billion.
GOING BEYOND OUR MANDATE
                                                                                 Salaries and Allowances
                                                                                 This expenditure is continually being reviewed and as a result the
                                                                                 percentage of Salaries and Allowances of the total Operating Budget has
                                                                                 declined steadily over the years to an acceptable level of 27.6%. The
        KEY ISSUES                                                               placement of staff in accordance with the recent restructuring process is near
                                                                                 completion. However, the Municipality will continue to look at new ways of
      AFFECTING THE                                                              doing business, improving productivity, implementing Business Process Re-
        OPERATING                                                                engineering (BPR) and undertaking restructuring initiatives in order to
                                                                                 maintain this expenditure at acceptable levels. Furthermore, in terms of the
         BUDGET                                                                  placement policy negotiated with Labour, temporary Council contract
                                                                                 employees who were employed for a continuous period of two and a half
                                                                                 years (30 months) as at 1 April 2003 may be placed in permanent positions.


                                                                                 Unaccounted for Water (Loss in Distribution)
                                                                                 Unaccounted for water is determined by comparing the water purchase
                                                                                 volumes with sales volumes. It is estimated that for the 2008/09 year, the
                                                                                 targeted loss in distribution will be a reduction to 30% from current level of
                                                                                 35%. The water loss intervention programme to reduce the water loss to
                                                                                 more acceptable levels is continuing with further funding provided to appoint
                                                                                 specialist consultants to assist the process and the replacement of ageing
                                                                                 infrastructure. Every possible measure will be taken to curb the water loss as
                                                                                 this has an impact on the setting of an affordable water tariff. The
                                                                                 effectiveness of the measures put into place will be reviewed on an ongoing
                                                                                 basis.
Unfunded Mandates
The eThekwini Municipality provide Health Services, Libraries, Museums,          Load Shedding - Electricity
and Housing. The reduction or non-payment for these services by other tiers      The recent load shedding experienced throughout the country also poses a
of government requires the Municipality to allocate its own resources to         challenge. As a broad assumption, a 5% reduction in energy
make up the shortfall.                                                           (consumption/purchase) will reduce the units gross income margin by R 95
                                                                                 million. In order to cover this potential shortfall in income, Council will be
Regional Electricity Distributors (REDS)                                         implementing a surcharge of 3% on electricity consumption with effect from
The necessity for RED’S is appreciated by Council. However, the institutional    2008-07-01.
framework i.e. the public entity model may impact on the Municipality’s          Council is in the process of carrying out a load shedding-awareness
funding given the significant reliance in terms of both income and leverage      campaign to reduce consumption by 10%. In addition, more energy-saving
for credit control. The Council, however, supports the SALGA position in this    light bulbs will be distributed and the likelihood of load-controlling geyser
matter i.e. there must be no impact on the finances of the Municipality and it   switches will be phased in this year. The rollout of energy saving light bulbs
must not adversely impact on the customer’s payment for services.                has already saved about 130MW for the City.
PLATFORM INFRASTRUCTURE
Infrastructure Provision and Repairs and Maintenance continues to draw a large proportion of our budgets.
Total expenditure for 2008/2009 is R1.62 billion: -


                                            ITEM / DESCRIPTION                                                      R’ m
Rehabilitation of housing rental stock to facilitate the sale of approximately 3000 units in terms of the Housing
Sales Campaign:                                                                                                            85.0
Maintenance of Road Network and Asphalt road surfacing inherited from other entities: Addressing of
backlogs and higher frequency of maintenance (increase of):                                                                82.0
Maintenance of additional storm water infrastructure inherited from other entities together with addressing the
flood damage backlog (increase by R 10.3m to):                                                                             15.3
Repairs and maintenance of ageing infrastructure and expansion of water services to rural areas:                       246.8
Repairs and maintenance to the electrical network due to increased faults and planned maintenance:                     351.1
Verge maintenance - Grass cutting (including new areas) - Increase by R 5m to:                                             20.0
Contract for reinstating and maintaining all red robot cameras:                                                             3.0
Maintenance of ablution blocks in informal areas (improving sanitation):                                                    4.0
Implementation of a comprehensive maintenance plan within the fire department for specialised fire fighting
equipment:                                                                                                                  2.0
Maintenance of the entire Information Technology network of the Municipality:                                              17.0




OUR REPAIRS AND MAINTENANCE PORTION OF THE BUDGET IS 10.8%, WHICH
                 IS HIGHER THAN ANY OTHER METRO
PROVIDING RESOURCES
• The hiring of new staff for critical vacancies and
  salary increases of 8.75% with effect from 1 July      The table below details the additional posts and related operations that need to be filled /undertaken
  2008 takes up a significant proportion of the          in the 2008/2009 financial year (R300 million)
  Operating Budget.
• This expenditure is continually being reviewed
  and as a result the percentage Salaries and                                                 ITEM / DESCRIPTION                                       R’m
  Allowances of the total Operating Budget has
  declined steadily over the years to an acceptable       New personnel and operational costs in respect of hostels taken over from KZNPA                124.0
  level of 27.6%. The placement of staff in
                                                          Provision for filling of 41 critical vacant posts for libraries                                   8.4
  accordance with the recent restructuring process
  is near completion. Whilst provision has been           Provision for filling of 231 vacant posts for Parks, Recreation, Cemeteries and Culture         28.0
  made in the budget for the review and revision of
  grades, the full impact can only be determined          Provision for recruiting 193 authorised officers to assist with traffic violations              16.0
  once the grading process has been completed.            Learnership Programme for 200 Peace Officers                                                      4.0
  However, the Municipality will continue to look at
  new ways of doing business, improving                   Additional staff requirements to assist with the illegal occupation of newly built houses         3.0
  productivity, implementing Business Process Re-
                                                          Staffing resources at new clinic in Adams Mission and other vacancies                             5.0
  engineering (BPR) and undertaking restructuring
  initiatives in order to maintain this expenditure at    Provision for 50 critical additional posts across all Fire and Emergency Unit.                  10.0
  acceptable levels.
• Furthermore, in terms of the placement policy           Provision for 40 learnership posts in the Fire Department                                         2.0
  negotiated with Labour, temporary Council               Provision for vacancies: improving turnaround time (building plans)                               4.0
  contract employees who were employed for a
  continuous period of two and a half years (30           Advertising for staff vacancies                                                                   5.1
  months) as at 1 April 2003 may be placed in
  permanent positions. This expenditure has been          Additional security services at one-stop-shops for Regional Centres                               6.2
  partially funded based on the anticipated               Hire of community co-operatives for cleaning services                                             2.6
  effective date of placement.
• As a result of the annualised effect of vacancies       Recruitment of additional forensic investigators                                                  2.0
  filled during 2007/2008, the use of temporary and       Trainee Accountant / Graduate Accountant Programme: skilled staff                                 6.0
  agency staff and the provision for task regarding,
  the year on year increase on employee related           Filling of technical / skilled posts in Electricity Unit                                        40.0
  costs is 13.1%.
• The Salaries and Allowances Task Team will              I. T. staff vacancies                                                                             8.0
  continue to monitor the top 150 earners and staff       Skills Development Unit staff vacancies                                                           5.0
  that receive overtime in excess of 50% of their
  basic salary. In order to comply with the Basic         Other critical vacancies and new posts                                                          21.0
  Conditions of Employment Act, staff that work
  more than 10 hours overtime per week will be
  investigated in order to reduce overtime costs.
SUPPORTING OUR COMMUNITIES
The following are selected highlights from the departmental operating budgets for 2008/2009-

Free Basic Electricity                                                                                                                     PROJECT / ITEM                            R’ m
Our Indigent Policy enables us to provide free 50 kwh of electricity to those customers who
consume less than 130 kwh per month. We adopted a self-targeted approach whereby customers              Provision of free basic electricity: indigent customers:                     16.7
who believe themselves to be indigent can apply, provided their average past 6-month
consumption is below the 150 kwh threshold.                                                             Zibambele poverty alleviation project for roads and verge maintenance:       51.9
                                                                                                        Refuse removal service to cover 100% of City:                                20.0
Zibambele Poverty Alleviation                                                                           Rehabilitation of landfill sites:                                            14.9
The Council ensures the empowerment of people in the community by providing small municipal
contracts for grass-cutting, verge clearance, etc. There is also a platform that the Council operates   Provision for critical staff vacancies:                                      80.0
for small co-operatives, providing administrative assistance, along with guidance on business
issues.                                                                                                 Eighteen operational soup kitchens: (11000 indigents):                         6.5
                                                                                                        Interest on loans : Additional DBSA loans:                                   35.0
Refuse Removal
We have extended provision of the service to newly-incorporated areas by using community-based
                                                                                                        Demolition of old tunnel: harbour entrance widening:                         21.0
contractors.
                                                                                                        Special events (including 2010 preparation):                                 15.9
Rehabilitation of Landfill Sites                                                                        Maintenance of IT network structure:
Planning and development of regional landfill sites continue to demand a substantial investment                                                                                      17.0
by the Municipality to ensure that waste is appropriately disposed off.                                 Repairs and maintenance:                                                    827.7
                                                                                                                   - Water: (ageing infrastructure) increases to:
                                                                                                                                                                                     246.8
Critical Staff Vacancies
We have provided for R300 million for new employees with related operations, including critical                    - Electricity: network maintenance increases by R 71.9m to:
staff (R80m). This is to increase our service delivery to the public. Security staff is a large                                                                                      351.1
proportion of this total.                                                                                          - Roads maintenance increases by R 47.3m to:
                                                                                                                                                                                     229.8

Soup Kitchens                                                                                           Special Events
This is one of our poverty-alleviation programmes. We provide free meals to the poor. We are            We cater for a number of events annually, including local and international events.
currently servicing 18 sites.                                                                           These include all our 2010 functions. This includes your One Nations Cup, Durban
                                                                                                        Beach Festival and Comrades Marathon, etc. Some events are hosted in partnership
                                                                                                        with other entities, including Provincial Government and the 2010 LOC.
Interest on Loans
The interest is paid on an additional DBSA loan of R950 million.                                        IT Network
                                                                                                        This cost is for the management and maintenance of the IT infrastructure network
                                                                                                        throughout the Municipality for the purposes of using excess capacity to provide
                                                                                                        competitive data and voice services to the general public.
Harbour Widening
This includes a portion of the cost for the demolition of the old sub-aqueous tunnel.
                                                                                                        Repairs and Maintenance
                                                                                                        Overall repairs and maintenance amounts to R 1.62 billion for the year, which
                                                                                                        represents 10.8% of the total budget, which is above most metros in the country.
A DIVERSE RANGE OF LINE SERVICES
                                            2005/2006          2006/2007                       2007/2008            2008/2009

                                                                         Expenditure (R)
                    Vote Description

                                             Actual             Actual                     Full Year Forecast   Full Year Forecast


 Electricity                                   2 703 744 000    2 794 746 000                   3 288 113 840        3 956 818 120
 Water                                         1 688 119 000    1 768 259 000                   1 984 397 830        2 421 443 060
 Treasury                                        802 550 000    1 530 918 000                   1 534 482 000        2 152 186 000
 Engineering                                     672 203 000      699 620 000                     890 391 305        1 105 839 720
 Parks, Recreation, Cemeteries & Culture         715 662 000      715 101 000                     838 188 750        1 001 776 195
 Sanitation                                      432 826 000      418 326 000                     502 246 740          612 536 860
 Cleansing & Solid Waste                         376 249 000      421 873 000                     478 969 290          547 798 860
 Metropolitan Police                             346 463 000      345 846 000                     418 192 620          460 721 400
 eThekwini Transport Authority                   172 567 000      204 180 000                     304 748 380          391 029 040
 Health                                          209 765 000      212 545 000                     248 658 330          303 159 700
 Housing                                         460 826 000      619 436 000                     153 850 640          234 498 950
 Emergency Services                              140 883 000      145 023 000                     174 141 720          215 111 500
 Development Planning & Management                73 157 000        77 202 000                    104 393 570          128 767 300
 City Enterprises                                 60 243 000        46 116 000                     75 250 580           87 889 360
 Community Participation & Action Support         21 498 000        25 399 000                     41 398 100           56 355 200
 Area Based Management                            40 560 000        42 189 000                     58 103 470           52 466 120
 Regional Centres                                 23 765 000        28 015 000                     40 672 430           48 694 670
 Economic Development & Facilitation              33 828 000        33 037 000                     40 697 450           45 277 870
 Business Support                                 22 675 000        25 189 000                     30 912 396           35 933 860
 Market Service                                   23 612 000        21 766 000                     30 993 070           30 847 660
KEEPING TARIFFS REALISTIC
    YEAR      RATES     WATER         ELECTRICITY    CPI
                                                                  • In the light of the significant challenges in the roll
  1997-1998      13.3           9.8            8.7          9.7     out of basic services to all our citizens, tariff
  1998-1999       9.8       18.7               7.3          7.0     increases have been moderately above inflation.
  1999-2000       8.9       14.1               5.7          7.7
                                                                  • The spikes in water supply tariff increases are
  2000-2001       7.9       13.2               4.7          7.8     attributed to a high water loss and increases
  2001-2002       9.9       29.6               5.1          8.0     from our bulk water supplier
  2002-2003       9.9           7.5            8.0         10.3
                                                                  • The significant increase in electricity expected in
  2003-2004      12.5           9.9            5.6          9.5     2008/2009 includes a 3% surcharge to cover the
  2004-2005       8.5           7.9            5.0          6.3     shortfall attributable to load-shedding.
  2005-2006       5.9           7.5            5.9          5.1
                                                                  • As a result of ongoing, fruitful negotiations with
  2006-2007       7.5           7.5            7.5          5.2
                                                                    Government departments a higher collection
  2007-2008       9.9       15.0               7.5          5.1     rate is anticipated. Good progress has also
  2008-2009       9.9           9.9           15.0          6.0     been made with collection of old debts (including
                                                                    government departments), which is also
                                                                    reflected in this projection.
                                                                  • Due to a focus on government departments and
                                                                    businesses that owe large amounts a higher
                                                                    collection rate is anticipated.
                                                                  • A programme has been put in place to
                                                                    encourage water customers to pay their current
                                                                    accounts in return for a reduction in the debt
                                                                    they have incurred. The approach targets the
                                                                    poorer section of our society that own properties
                                                                    valued at or less than R100000. Due to this
                                                                    programme an improved collection rate is
                                                                    anticipated.
A SIGNIFICANT CAPITAL BUDGET
                 CAPITAL PROJECTS                         2008/09       2009/10      2010/11
                                                                                                   FUNDING SOURCES (2008/2009)
                                                           R’m           R’m          R’m

 2010 Soccer World Cup                                                                           KING TO PLACE PIE GRAPH OF
  -             Stadium                                     1 318.9         299.4         26.8
  -             Stadium Precinct                               13.3           0.0          0.0
                                                                                                        WHERE THE MONEY HERE.
                                                                                                  CAPITAL BUDGETCOMES FROM
                                                                                                                           MIG (R445.8M)     PTIF (R492.0M)
  -             Transport                                     519.1         411.6        529.7                                  7.4%               8.2%
                                                                                                                                                              Other (R292.0M)
                                                                                                                                                                    4.8%
                                                                                                         Equitable Share
  -             City Regeneration                             112.5          85.0          0.0            (R314.5M) 5.2%

 Port (Freight Man)                                             46.7        28.1         28.7

 IT – Strategic Projects                                        84.9        31.5         89.2         Dept of Housing
                                                                                                        (R816.0M) 13.5%

 Western Aquaduct                                            250.0         200.0        200.0                                                                             Council (R2350.5M)
                                                                                                                                     2010 Stadium,                               39.0%
 Tourism nodes development                                      10.9        15.5         13.3                                    National Treasury,
                                                                                                                                      KZN, Council
                                                                                                                                   (R1318.9M) 21.9%
 Town Centre Renewals                                           22.7        22.5         31.2

 Neighbourhood Development Partnership                          74.5       133.1        172.2
                                                                                                          TOTAL DRAFT CAPITAL FUNDING R5. 9297 BILLION
 Housing Delivery Infrastructure
  King Shaka Airport                                        1 164.9
                                                               11.2       1 250.7
                                                                             40.0      1 186.9
                                                                                          70.0

 Infrastructure to meet backlogs:
  -                 Water                                     260.5         137.5        138.7
  -                 Sanitation                                170.5         151.3         95.5    Did you know that…
  -                 Roads                                      50.5          81.3         47.8    We have the largest capital budget spend of any
  -                 Storm water                                15.1          17.1         17.5
                                                                                                    municipality in South Africa.
  -                 Community Projects                         30.0          30.0         45.0
                                                                                                  • We ensure communities become and remain sustainable
 Safety and Security                                            18.5          8.0          9.0     in terms of livelihood is becoming one of the greatest
 Public Transport Plan                                          22.2        24.0         24.0      challenges for the municipality. It is clear that sufficient
                                                                                                    resources are not available to eliminate all backlogs at the
 Bulk Rehabilitations/Reinforcement
  -                Water                                      439.9         483.1        253.0
                                                                                                    current service levels. Without additional sources of
  -                Waste Water                                142.5         178.5        224.5      revenue, the Municipality had to consider alternative
  -                Refuse Removal                              64.6          39.5         83.7      options. Various alternative funding options are being
  -                Roads / Pedestrian Safety                  237.5         248.7        304.5      considered for inclusion in the Long Term Financial
  -                Electricity                                427.7         520.3        550.8      Strategy. Borrowings of R 950 million will be made during
  -                Stormwater                                  20.8          38.3         30.9
                                                                                                    the year in order to accelerate the capital program, in an
  -                Community Facilities                        47.9          54.4         67.8
                                                                                                    attempt to eliminate the backlogs.
  -                Vehicle Replacement                         65.7          57.0         67.0
  -                Operations: Various Services               148.6         130.9        158.3
                                                                                                  • The projected capital expenditure budget for the
  -                ABM’s                                       29.8          11.2         11.9      2008/2009 financial year period is R 5.93 billion (2007/08:
  -                Other (Markets, Fire Stations, etc.)       107.9         105.0         89.4      R 4.20 billion ) which is a growth of 41.2 % on that of the
                        TOTALS                             R 4 765        R 3 583    R 3 380        previous year.
MANAGING LEGISLATIVE CHANGE
Section 3(1) of the Local Government Municipal Property Rates Act, 2004 (Act 6 of 2004) and section 62 (1)(f) of the MFMA determines that a municipality must
adopt and implement a rates policy on the levying of rates on rateable properties. The new rates policy was approved by Council on the 11 February 2008 and
complies with the Municipal Property Rates Act. Thus, the levying of rates will have an impact on the rates individual property owners will pay with effect from 1
July 2008. As properties are now being assessed based on the market value there is a shift in incidence. The cent in the rand (randage) has been adjusted
downward to compensate for the higher values. In addition, the impact on the indigent, pensioners, disability grantees and lower and middle-income ratepayers
was considered to ensure a limited impact. Revenue neutrality has been maintained using existing income per category of property as a base to calculate the rate
randage for the new year. The rating of property based on market value has resulted in a minimal shift in incidence between the different categories of property.
State property is now rated in accordance with usage resulting in a shift to other property categories particularly business, commercial, as well as vacant land.


                                       Number of      New Property      Old Property
                                                                                                                   ANALYSIS OF VALUATION ROLL
      Category of Properties                                                             % Increase
                                       Properties        Value             Value
                                                                                                                 Residential                    Business and
Agricultural                                    705     1 783 527 000     364 088 000       389.86%                                              Commercial
Business & Commercial                        15 549    65 554 951 000   22 593 037 300      190.16%     Total number of properties is      Total    number     of
                                                                                                         415469.                             properties: 15549.
Exempt (e.g. Religious Bodies, etc.)          1 240     3 711 674 000     822 258 500       351.40%
                                                                                                        Approximately          108971      About 5814 (37%)
Industrial                                    4 018    30 578 887 000   12 281 345 400      148.99%      (26%)        of    residential      properties will have a
PSI                                          11 083     6 410 968 000      49 435 800     12 868.27%     properties are valued at            reduction in rates.
                                                                                                         under R120000 and will pay
Residential                                 415 483   234 660 282 000   49 091 833 250      378.00%      no rates.                                Industrial
Vacant Land                                  54 300    21 974 175 000    2 417 713 243      808.88%     227870 (55%) of properties         Total     of      4018
                                                                                                         will see a reduction in rates.      properties.
Totals / Average                            502 378   364 674 464 000   87 619 711 493      316.20%
                                                                                                        About 16% of residential           Nearly 2424 (60%)
                                                                                                         property have a value higher        properties will see a
                                                                                                         than R1 million.                    reduction in rates.
                                                                                                        No rates payable in respect
                                                                                                         of      properties      valued          Vacant Land
                                                                                                         R400000       or   less      for   Total     number      of
                                                                                                         pensioners,           disability    properties is 54300.
                                                                                                         grantees,        child-headed      All vacant land will
                                                                                                         households        and       the     receive     the    first
                                                                                                         medically boarded.                  R30000 of value as a
                                                                                                                                             reduction for rates.
                                                                                                                                            Nearly 18620 (34%)
                                                                                                                                             of properties will pay
                                                                                                                                             less for rates.
A GOOD FINANCIAL RECORD
                       * FINANCIAL STATISTICS 2007/2008                                       * MONTHLY BILLING VERSUS PAYMENTS 2007/2008

        METRO         TOTAL       DAYS         NET           TOTAL       NET DEBT :                   METRO                 05/06       06/07     07/08
                     INCOME      CASH ON    CAPEX:           DEBT :       INCOME                                             (%)        (%)        (%)
                       (Rm)       HAND        TOTAL        INCOME          (RATIO)
                                            INCOME          (RATIO)                         ETHEKWINI / DURBAN                  93          96        96
                                             (RATIO)

CAPE TOWN              9 394.8       78.6        15.6           25.1                  3.2   Despite the increase in debtors, the payment/cash
                                                                                            collection rates have increased. The debtor
EKURHULENI             8 470.3      144.7           9.0         15.9             (16.4)
                                                                                            increase is due to interest charges and penalties
ETHEKWINI / DURBAN    11 539.1      143.1        20.1           39.7                  8.0   from historical debt and higher levels of poverty.
JOHANNESBURG          14 088.8       69.0        19.4           41.8              25.1

NELSON MANDELA         2 962.4      169.7        17.5           14.8             (32.3)
                                                                                            The Municipality has yet again managed to maintain its
TSHWANE                8 067.4       60.1        19.4           34.5              20.4       excellent credit rating of A1+ (short-term) and AA (long-term)
                                                                                             for the third year in succession, as published by the Global
WEIGHTED AVERAGE          N/A       102.3        17.2           31.9                  7.4
                                                                                             Credit Ratings Company. These short and long- term ratings
                                                                                             are amongst the highest ratings accorded to local authorities
                                                                                             in South Africa and naturally it will provide the Municipality
                                                                                             with a sound financial platform to meet its economic
                         * DEBT & LIQUIDITY 2007/2008                                        challenges and service delivery targets.
                     S/TERM      L/TERM     TOTAL           CASH            CASH
                      DEBT        DEBT      DEBT          HOLDINGS        COVERAGE
                                                                                            The factors influencing the strong credit ratings are as
        METRO
                      (Rm)        (Rm)       (Rm)           (Rm)        (TOTAL DEBT)        follows: -

CAPE TOWN              137.5      2 217.2     2 354.7         2 054.5                 0.9   • The significant progress that we have made since
EKURHULENI               52.8     1 295.5     1 348.3         2 737.9                 2.0     transforming into a metropolitan municipality, supported by
                                                                                              the Municipality’s experience and capable management
ETHEKWINI / DURBAN     236.6      4 345.1     4 581.6         3 657.7                 0.8
                                                                                              team, and the prudent judgment displayed by the political
JOHANNESBURG           113.6      5 770.5     5 884.1         2 354.3                 0.4     leadership.
NELSON MANDELA           26.4       413.3       439.6         1 396.0                 3.2   • The substantial and increasing level of spending by Council
                                                                                              on the World Cup related and socio-economic projects, and
TSHWANE                105.0      2 680.3     2 785.4         1 136.2                 0.4     the associated longer term benefits thereof.
TOTAL                  671.9     16 721.9    17 393.7        13 336.6                 0.8   • The Municipality continues to display a robust financial
                                                                                              profile, characterised by strong cash generation and high
                                                                                              liquidity levels.
 * NOTE: MUNICIPALITIES MAY DIFFER IN THE METHOD USED TO DETERMINE                          • Key debtors ratios have remained fairly stable in recent
  KEY STATISTICS.                                                                             years, while collection levels have improved.
COMPARING WITH OUR COUNTERPARTS
  The following tables give a comparable indication of residential tariffs between the various metros for 2008/2009: -
  Service       eThekwini / Durban             Cape Town              Johannesburg                    Tshwane                Nelson Mandela              Ekurhuleni

Water         • Increased by 9.9%.        • Increased by 9.2%.    • Increases unavailable.    • Increased by 8.0%.        • Increased by 6.0%.    • Increased by 6.3%.
              • 6kl free.                 • 6kl free.             • 6kl free.                 • 6kl free.                                         • 6kl free.
              • No fixed charge for                               • 4 rising block tariffs.   • 4 rising block tariffs.                           • 4 rising block tariffs.
                property < R190K.

Electricity   • Increased by 12.0% +      • Increased by 15.0%.   • Increases unavailable.    • Increased by 12.0%.       • Increased by 12.0%.   • Increased by 12.2%.
                3.0% surcharge.           • Consumption based.    • Consumption based.        • Consumption based.                                • Consumption based +
              • Consumption based.        • Fixed charge + 1      • Fixed charge + 2          • One tariff.                                         2 tariffs for high/low
              • One tariff.                 tariff.                 tariffs high/low                                                                season.
              • The first 50kwh of                                  season.
                electricity is free to
                residents using less
                than 150kwh per
                month.

Rates         • Increased by 9.9%.        • Increased by 7.3%.    • Increases unavailable.    • Increased by 8.0%.        • Increased by 8.5%.    • Increased by 3.0%.
              • On market value of        • Only market values    • No lifeline for rates.    • No rates on first R10K                            • On land only.
                property.                   of properties.        • No rates on first R15K      of all properties.                                • No rates if below the
              • No rates on first R120K   • No rates on first       of all properties.                                                              indigent limit &
                of all properties.          R80K of all                                                                                             rebates based on
                                            properties.                                                                                             earnings.

Refuse        • Increased by 9.9%.                                • Increases unavailable.    • Increased by 8.0%.        • Increased by 6.0%.    • Increased by 8.0%.
              • Included as part of       • Increased by 7.5%.    • Based on property         • Based on container                                • Fixed charge.
                rates randage.              Based on container      size.                       size and removal
                                            size.                 • Rising block tariff as      frequency.
                                          • Rebate % based on       size increases.
                                            property value
                                            <R50K to R125K.

Sewerage      • Increased by 9.9%.        • Increased by 6.0%.    • Increases unavailable.    • Increased by 8.0%.        • Increased by 6.0%.    • Increased by 7.5%.
              • Included as part of       • Based on kl water     • Based on kl water         • Based on kl water                                 • < 6kl: no charge then
                rates randage.              used.                   used.                       used.                                               there is a rising block
                                                                  • < 6kl no charge then                                                            tariff system.
                                                                    rising block tariff.

Average                10.9%                     12.0%                      N/A                         9.0%                       9.3%                     7.4%
Weighted
Increase


  WE PROVIDE A COMPARABLE BASKET OF SERVICES WITH OTHER CITIES
UNQUALIFIED FINANCIAL STATEMENTS
             DETAIL (In millions of Rands)   2007      2006
TOTAL REVENUE                                 12 004    10 403
                                                                           SNAPSHOT: 2007/2008
TOTAL EXPENDITURE                             10 874     9 601   Assets: Property, Plant           Acquisitions of R4.2 billion.
                                                                 & Equipment                       Depreciation of R1.1 billion.
SURPLUS FOR THE YEAR BEFORE TRANSFERS          1 130      802
                                                                                                   Static over the last two
                                                                 Consumer Debtors                  years. R41m increase
ACCUMULATED FUNDS & RESERVES                  10 084     8 954                                     between 2006 and 2007.
NET CASH & CASH RESOURCES                       275       641                                      Borrowed R950 million at
                                                                 Long-Term Borrowings
(Bank, Cash & Call Deposits)                                                                       8.3 % fixed for 20 years.
TOTAL ASSETS                                  21 999    20 168   Consumer Debtors                  Collection Rates: 95%.
CONSUMER DEBTORS                               1 773     1 732

                 ASSETS/LIABILITIES          2007      2006      RATIOS AND BENCHMARKS
                                             R’m       R’m       •Assets/Liabilities Ratio: 1.8/1.0
Assets                                                           Favourable and stable from previous year.
         –Cash and Short-Term Investments      2 062     3 261
                                                                 BENCHMARK: 1.0:1.0
         –Property,Plant & Equipment          11 613    10 292
         –Consumer Debtors                     1 773     1 732   •Current Ratio: 1.4/1.0
         –Investments                          3 749     2 601   Favourable and has improved from previous year.
         –Other                                2 802     2 282   BENCHMARK: 2.0:1.0
Total Assets                                  21 999    20 168   •Gearing Ratio 1.4/1.0
Liabilities                                                      Favourable and has increased from previous year.
         –Long-Term Liabilities                4 345     3 738   BENCHMARK: 1.0:2.5
         –Creditors                            3 391     2 827
                                                                 Consumer Collection Rates:
         –Unspent Conditional Grants             131       101
         –Other                                4 048     4 547                             •Rates:                 95.8%

Total Liabilities                             11 915    11 213                             •Water:                 92.8%
                                                                                           •Electricity:           98.0%
Net Assets                                    10 084     8 955
STIMULATING THE LOCAL ECONOMY




                                                               The Durban ICC continues to be foremost convention
                                                               centre in Africa. Durban certainly set the trend, as other
                                                               cities in the country and the continent at large, began to
                                                               construct their own centres. Further to this, the Durban
                                                               ICC ranks in the Top Ten in the world, having brought a
                                                               number of delegates to Durban through its hosting of           This project has unlocked more than 160 ha of low yielding
                                                               seminars, conventions and other functions. Effectively,        sugar cane land, enhancing the concept of the activity
                                                               the ICC has paid for its construction and its operating        corridor as a business activity node. It has effectively
From 2004 to 2005, uShaka was instrumental in catalysing       costs many times over through its multifarious effects on      brought the workplace closer to the workforce. It has
the growth of stagnant housing prices in the Point area,       the local economy through spurring secondary tourism.          promoted spatial efficiency with regard to KwaMashu,
which was experiencing spiralling urban decay. Because         Beyond just municipal coffers in terms of increased            Inanda & Ntuzuma and unlocked the development node of
of the Municipality’s intervention, growth in the area         revenues, local hotels, restaurants and other tourist-         Phoenix. The industrial usage of the area has higher
exceeded the national housing price index. In a period of      related infrastructure have seen significant growth in         economic benefit than agricultural use and has had a
two years, increases of 200% was achieved in the area.         turnover that can be indirectly attributable to the ICC.       positive effect on land values of the surrounding areas. The
uShaka has catalysed further growth in the area,               Effectively, it is a key marketing tool in the City, that      project created some 3500 jobs during the construction
specifically the sweeping development of the Point             places us on the global map. As with any infrastructure,       phase and some 13500 new jobs post development is
Waterfront, Canal System and the Small Craft Harbour.          evolution is key to maintaining the superiority of its         expected in the long-term.
Because of municipal intervention, an area that was once       product. Concomitantly, the ICC has nearly completed its
in a state of decay, has now become an integrated              expansion. It has effectively doubled its convention space,
residential, recreational, tourist and soon-to-be shopping     and can also be used as an indoor sporting facility as well
destination. Over and above these sweeping positive            as a venue for musical concerts on a larger scale. The
effects, uShaka continues to receive international             total economic impact flowing from the ICC business for
accolades for its truly innovative design and world-class      the financial year was R565.5m. Based on a multiplier of
facilities. Employing approximately 750 staff (including the   4, which is the commonly used factor in the meetings
South Association for Marine and Biological Research) ,        industry, the total economic impact of the business
uShaka MARINE WORLD achieved 90% of its budgeted               generated by the ICC equates to R1.068billion. This
footfall into the paid environment in its first year at 1.2    effectively means that the contribution of the Centre to the
million guests and 3.8 million guests into the whole park.     GDP of the KZN province is almost 1% (0.58%). Foreign
On 19 September 2007 the controlling shareholder,              exchange earnings to the tune of R81million and a total
eThekwini Municipality, invested a further R157m into the      direct spend estimated at R267million were generated
theme park for which 1617 shares will be issued. These         from conference delegates. Overall financial performance
funds were used to settle the outstanding capital loans        for the year was better than budget, with total revenue at
with Citibank (R88m as of 30 June 2007) and the                R73.3m against a budget target of R54.9m. This was
Development Bank of Southern Africa.                           largely driven off business levels for the first and second
                                                               quarters of the financial year. The Municipality contributed
                                                               R22m in the 2007/2008 financial year to the ICC.
READINESS FOR 2010
                                                                                           The new Moses Mabhida stadium will be a world-class
                                                                                           facility.
                                                                                           Most prominent feature of the new stadium, to be built
                                                                                           on the site of the existing football stadium, will be the
                                                                                           30-storey arch stretching its entire length.
                                                                                           Stadium will be built on the site of the existing King's
                                                                                           Park stadium and has been designed as a first-class
                                                                                           multi-purpose sporting facility.
                                                                                           The 100m high arches will mark the centre of Durban's
                                                                                           growing Sports City Complex.
                                                                                           Stadium will have a seating capacity for 70000 people.
                                                                                           Arches will have a cable-car erected.
                                                                                           Stadium will cover 320 x 280 square metres and will
                                                                                           be 45m in height.
                                                                                           Parking for 10000 cars.




COST IMPLICATIONS                                                          Stadium Funding Infrastructure
 Will have a major impact on spending for the Municipality.
 Total cost of stadium: R2.6 billion.
                                                                           Transport.
        National Government: R 1.8 billion.                               ICT.
        Provincial Government: R 0.3 billion.                             Upgrading / Improvements.
        eThekwini:                 R 0.5 billion.                         Operating costs.
 Financial impact of related infrastructure: R4.0 billion. (Still under
  discussion with FIFA LOC and National Treasury.)
MEASURING THE ECONOMY
                              Measure          2006

Gross Value Added (GVA)                         R115.7 billion

Gross Domestic Product                          R126.6 billion

Gini Coefficient                                           0.60

Per Capita Income                                      R34 392

GVA Average Annual Growth                                 5.2%

Population                                            3 299 788

Age Structure:                                            27%
00-14                                                     21%
15-24                                                     32%
25-44                                                     20%
45+

Population Growth (2005-2006)                             0.6%

Geographic Area                                       2 297km2

Population Density                          1 437 persons/ km2

Human Development Index                                    0.68
                                                                  The local economy is affected by the performance of the national economy, although recent indicators
Urban Population                                         86.2%    suggest it is outperforming the national one in terms of the Gini Coefficient, unemployment rate and the
Employment Rate:                                         64.5%    Gross Domestic Product. The national economy continued to enjoy growth of around 4.7% during 2006 and
                                                                  is starting to reap the benefits of sustained sound macroeconomic management and structural reforms.
Unemployment Rate:                                       35.5%    In addition to achieving the Accelerated and Shared Growth Initiative (ASGISA) target of 4.5% per annum,
                                                                  the country has also experienced 36 quarters of uninterrupted economic growth. Presently South Africa is
Operating Budget: 2007/2008                      R13.2 billion
                                                                  ranked as the 18th most attractive destination for Foreign Direct Investment according to a recent
Capital Budget: 2007/2008                         R4.2 billion    international survey. Massive infrastructure investment plans have been announced by both the private and
                                                                  public sectors for public transport, new power plants and township renewal growth. Unemployment remains
Municipal Staff Employed: 2006                          18 500    high, but job prospects are amongst the highest in the world for the second year running, creating 200000
                                                                  jobs between March 2006 and 2007.
Number of Households:                                  914 198
                                                                  In the first phase, between 2005 and 2009, ASGISA seeks an annual growth rate that averages 4.5% or
Number of People in Poverty: < $2 per day              397 073    higher. In the second phase, between 2010 and 2014, an annual average growth rate of at least 6% of GDP
                                                                  is targeted.
% of People in Poverty:                                  12.0%    GDP growth in Durban has grown at an average annual rate of 3.9% over the period 1996-2006 and has
Urbanisation Rate:                                       91.4%    been consistently strong and lagging slightly behind Johannesburg and Cape Town. As reflected in the graph
                                                                  below, the manufacturing sector in Durban is the biggest contributor to the GDP growth, followed by finance,
Annual Total Disposable Income:                        R73 791    trade and then transport. When deconstructing the manufacturing sector in Durban, the success is due
                                                                  largely to the chemical, automotive, pulp and paper, wood and wood products, and food and beverages
Annual Household Expenditure:                   R113.7 billion
                                                                  components. The City’s Economic Strategy acknowledges the importance of these sectors’ potential for
Annual Retail Sales:                             R36.4 billion    growth, job creation and global competitiveness, and has aligned appropriate medium-to-long-term plans for
                                                                  further enhancement. The National Government’s new industrial-policy framework that re-emphasizes the
Total Exports:                                   R31.3 billion    development of the country’s manufacturing sector as the cornerstone of the economy will also contribute to
                                                                  this sectors growth.
Total Imports:                                   R48.3 billion
                                                                  The introduction of the Dube Trade Port and King Shaka International Passenger Airport, the 2010 World
                                                                  Cup Soccer Competition, and the major expansion plans around the Port of Durban are the three main
                                                                  projects that will act as a major catalyst to the City’s economy over the next ten years.
INVESTMENT IN THE CITY
                                   Spinoffs from
                                    Dube Trade
                                       Port
                                                                                       Business & Investment Marketing: - Other targets & channels
                                                    Lowest cost
                                                                                            engaged; Products developed & distributed; Effective
                  Significant                       package of                              budget allocation in synergy with other Units.
                 opportunities                       municipal
                   for 2010                           services                         Existing Business Retention and Expansion: - BR&E rollout
                                                                                            continues; South Durban Basin (SDB) Area 1 in conclusion;
                                                                                            SDB Area 2 launched; Multiple Chamber partnership
                                                                                            projects continue; Strategic businesses & flagship
                                                                                            investment projects in ongoing engagement/aftercare.
       Large pool of                                            Low cost of
      skilled workers                                         industrial land          Foreign Investor Support: - Leveraging targeted work with other
                                                                                            spheres & Agencies; several fdi engagements held; 3 large
                                                                                            fdi enquiries converted; 2 incubated on site; bids for more in
                                                                                            progress.
                                                                                       Business Development in R293 Townships: - Draft strategic
                 Modern IT and
                   Telecom
                                                      Excellent
                                                      transport
                                                                                            outline developed, but due to changes in Project Managers,
                   networks                         infrastructure                          progress is slowed.
                                                                                       Create a Business-Friendly Environment: - Ad hoc interventions
                                  Most important
                                   port in Africa
                                                                                            continue on a case by case basis, but formal project outline
                                                                                            now completed (National Government assistance) & project
                                                                                            manager engaged for roll-out, but progress has slowed.
                                    Maintain a                                         Under-Capitalised Investment Development: - 3 projects being
                                     positive
                                    operating
                                                                                            developed: One in multiple location aquaculture; the other a
                                    cashflow,                                               large Umlazi Business Service Centre; the 3rd in computer
                                                                                            & TV assembly.
                                                                                       Business Investment & Targeted Incentives Strategy: - Draft
                                                                                            outline developed, & 1st City work shop held but due to
                                                                                            change in Project Manager, plus HR constraints, progress
                                                                                            has slowed.
                                                                          Capital
  All reserves
   are cash-
                                                                      expenditure of   AgriBusiness Forum: – PPP Forum established; Summits held;
                                                                       (R50 Billion
    backed.                       We have a 5-                         in ten years)        Market Days launched; Strategy refined; Amakhosi projects
                                  point plan as                                             progressed; Newsletter launched; breakfast workshops
                                 our approach in                                            held; new staff capacity engaged.
                                  managing the
                                  Municipality’s                                       2010 Eco-Dev & Bus. Opportunities Workstream: - Team
                                   finances: -                                              sourced & developed; Strategy presented & agreed;
                                                                                            authorised engagements held; action plan presented & in
                                                         Critical
                                                                                            roll-out; partnerships with chambers & other government
             Finance capital
             projects mainly
                                                      indicators to                         spheres developed; new staff capacity engaged.
                                                       benchmark
                 through                                   our
              internal funds.                         productivity.
CARING FOR ALL OUR CITIZENS
                                                                                              ESTIMATED    • Ideally the City would like to deliver 20000 units annually to
                                                                              APPROXIMATE
                                                                                              NUMBER OF      deal with the housing backlog, however, due to yearly
 SERVICE                           SOCIAL PACKAGE                                COST
                                                                                              HOUSEHOL       limitations on housing subsidies this is not achievable.
                                                                                  R’M
                                                                                                  DS
                                                                                                             Accordingly, the Municipality is in the process of developing an
                                                                                                             Accelerated Housing Delivery Model, which would involve
                 Residential property owners are exempt from paying
                 rates on the first R 120 000 of their property value.
                                                                                                 108 971     securing funding from a range of sources which would inter
                                                                                                             alia involve the major financial institutions as well as the
                 Pensioners,   child-headed   households,   disability
                                                                                                             private sector and social housing institutions.
Assessmen        grantees and the medically boarded are exempt from
t Rates                                                                                                    • The basic social package is an affirmation of the Municipality’s
                 paying rates on the first R400000 of their property
                 value. (This amount is inclusive of the R120000
                                                                                                  20 258     commitment to push back the frontiers of poverty by providing
                 mentioned above.)                                                                           a social welfare to those residents who cannot afford to pay,
                                                                                                             because of adverse social and economic realities. The social
                 Total Exemption in Rebates, Reduction, Properties
                 Valued Under R120K, etc.
                                                                                     855.8       129 229     package will also assist the municipality in meeting its
                                                                                                             constitutional obligations. However, in order for us to continue
                 The first 6kl of water is free to all residents.                                            to deliver these services in a financially sustainable manner,
Water            Households with property values at R40 000 or less do               202.0       280 000
                 not pay the fixed charge for water.                                                         all residents will have to pay for services over and above the
                                                                                                             free basic services provided.
                 The first 50kwh of electricity is free to residents using
Electricity      less than 150kwh per month (Qualifying households will
                                                                                                  58 000
                                                                                                           • The estimated cost of the social package (i.e. income
                 have to make application for this concession).                       17.0                   foregone) amounts to approximately R1074.8m for the
                                 TOTAL                                              1 074.8                  2008/09 budget year. This is mainly funded from the R1.6
                                                                                                             billion equitable share from national government.

               Basic Service                  Existing Backlog
                                                                               DESPITE OUR
 Housing                                      200 000 households             SUCCESSES, THE
 Water                                        165 000 households
                                                                              CHALLENGE TO
 Sanitation                                   200 000 households
                                                                                 PROVIDE
                                                                              EQUALITY FOR
 Electricity                                  200 000 households             ALL STILL EXISTS,
 Solid Waste                                        Nil households             BUT WE ARE
 Stormwater                                         R 143 000 000            DETERMINED TO
 Roads                                            R 2 200 000 000            MAKE DURBAN A
 Sidewalks, pedestrian bridges &                     R 131 000000             LIVEABLE CITY
 footpaths
                                                                             FOR EVERYONE.
PROVEN CAPABILITIES
  SOME IT STATISTICS                                             OUR GLOBAL POSITIONING
 • No. of faults processed per month:              2 500        • Sister cities twinned with Durban: 12                  WATER AND SANITATION
                                                                                                                         •11 000 km of pipelines.
 • No. of change requests processed per month:      500         • Active projects with sister cities:   39
                                                                                                                         •725 000 units connected.
 • No. of PC users:                                7 000        • Incoming international delegations: 50                 •220 reservoirs.
                                                                                                                         •8 000 km wastewater pipes.
 • No. of daily transactions processed:        1 000 000        • Meetings with consular corps:         26
                                                                                                                         •27 wastewater treatment works.
 • No. of internet users                          2 000         • CIFAL training sessions held:         2                •280 pumpstations.
                                                                                                                         A CITY THAT PROVIDES…
 • No. of bills / inserts printed per month:   2 000 000         A COSMOPOLITAN CITY…
 • No. of fines processed per month:             85 555
  A TECHNOCRATIC CITY…
   LINKING WITH THE PRIVATE SECTOR                                                                                  LIGHTING UP THE CITY
• About R3.1 billion S.A. company new
                                                               WE ARE A COMPLEX                                     • Major Substations            99
  investments/expansions thus far.                            ORGANISATION THAT                                     • Distributor Substations     631
• Business Retention and Expansion (BR&E)                    DEALS WITH COMPOSITE                                   • Mini Substations           5461
  project roll-out in SDB Area: 2 of 3 in South                                                                     • Brick Substations
  Durban Basin (950 businesses directly
                                                               SOCIAL, TECHNICAL,                                                                2736
  assisted; 16 Action Teams launched; new                        FINANCIAL AND                                      • Pole Transformers         4350
                                                                                                                    • Streetlights            200 000
  Business tools distributed).                                ECONOMIC ISSUES…
• R1.7 billion foreign investment already                                                                           A CITY THAT BRIGHTENS YOUR DAY…
  confirmed/secured thus far + another R2.5Bn
  being sourced/facilitated at present.
• Full investment promotion marketing: plans               FLEET AND PLANT                                   SOLID WASTE
  converted and products rolled out for full               •Total vehicles serviced:           2939          • No. of tons removed and disposed:            1 418 264 tons
  Council benefit.                                         •Number of the targeted services: 3696            • No. of houses serviced:                      1.1 million
• Agri-Business Forum expanded & various                   •Ratio of artisans to vehicles:.   1:103          • No. of refuse bags distributed:             43 million
  projects initiated. Ramping up to capitalise on          •Average vehicle availability:     94%            • No. of commercial customers:                31 000
  Dube TP & other flagship projects.                       •Number of vehicles licenced:     1695            • No. of wheeled containers & skips:           80 000
• Three new business development projects of               •Income from hire pool:           R6.45m          • No. of landfill sites:                      3
  R1.7 billion being progressed.                           •Income from disposal of vehicles: R2.3m          • No. of transfer stations:                   8
• 2010 Eco-Dev & Bus. Opportunities Work                   A CITY THAT WORKS…                                • No. of garden refuse sites:                   12
  Stream plan confirmed, resourced & being                                                                   • Vehicle fleet complement:                    424
  rolled out through partnerships.                                                                           • No. of re-cycling drop-off centres:         15
                                                                                                             • No. of re-cycling buy-back centres:          7
A CITY THAT ENGAGES WITH BUSINESS…                                                                           A CLEAN CITY…
THE BUILDING-BLOCKS FOR SUCCESS

   WE HAVE STRONG,     WE HAVE A STABLE      WE HAVE A PRO-         WE HAVE
      PRAGMATIC         EXPERIENCED          POOR FOCUS IN        CONSISTENTLY
     MANAGEMENT        ADMINISTRATION.     TERMS OF SERVICE-        APPLIED A
   LEADERSHIP WITH                             DELIVERY.         STRATEGIC SPLIT
  PROVEN EXPERTISE                                               BETWEEEN OUR
 IN MUNICIAL SERVICE                                               SOCIAL AND
       DELIVERY.                                                   ECONOMIC
                                                                  EXPENDITURE.




 WE HAVE ACHIEVED         WE HAVE THE      WE HAVE A DEBTORS’   WE HAVE ACHIEVED
    CONSISTENT          HIGHEST CREDIT-     COLLECTION RATE      MORE THAN 95%
    UNQUALIFIED        RATING AWARDED IN     CONSISTENTLY       CAPITAL SPEND PER
   (CLEAN) AUDIT         THE MUNICIPAL         ABOVE 95%.            ANNUM.
     REPORTS.               SECTOR.




 WE WERE THE FIRST     WE HAVE REVERSED       WE RECEIVE             WE HAVE A
   MUNICIPALITY IN      URBAN DECAY IN         REVENUE &            STRATEGIC
  SOUTH AFRICA TO      MANY AREAS IN THE   ELECTRICITY FROM     PARTNERSHIP WITH
    ESTABLISH AN             CITY.           LANDFILL SITES,       THE PORT TO
   INTERNATIONAL                            SIMULTANEOUSLY           INCREASE
    CONVENTION                             USING SUSTAINABLE    EFFICIENCIES IN THE
      CENTRE.                                DEVELOPMENT          HARBOUR AREA.
                                            METHODOLOGIES.
A METRO THAT IS OPEN TO DISCUSSION

            GENERAL                DETAIL
 General Council Number       031-311 1111
 Treasury                     031-311 1131
 Website                      www.durban.org.za
 Core Hours of Business       09h00 – 12h00
                              13h00 – 16h00

 Call us for discussions / advice on: -
 •Investor Services
 •Business Support.
 •Economic Services.
 •Logistics Information.
 •Land Acquisition.
 •Infrastructure Provision.

   OUR COMMITMENT TO YOU: WE WILL RESOLVE EVERY
       QUERY FROM THE PUBLIC AND BUSINESSES

				
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posted:8/24/2011
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