Why SA municipalities continue to underspend grant allocations.
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GUEST - Miyelani Holeni Group Chief Advisor at Ntiyiso Consulting Group
The underspending of grant allocations, accumulating customer and municipal debt, and inadequate progress in revenue collection across South Africa’s 257 municipalities remain a cause of concern for the National Treasury. This was outlined by the Treasury discussing the recently released Local Government Revenue and Expenditure report for the second quarter of the 2023/24 financial year (up until 31 December 2023).
Municipal spending on both operating and capital budgets accounted for 46.3%, or R283.5 billion, of the total approved expenditure budget of R612 billion. Revenue from billing and other sources reached 50.3%, or R310.9 billion, of the total approved revenue budget of R618.5 billion. Municipalities also set aside R154.5 billion for salaries and wages. This marks a R7.9 billion, or 5.4%, rise from the R146.6 billion budget allocated for the 2022/23 municipal financial
year. By 31 December 2023, R72.8 billion, or 47.2% of the allocated budget for salaries, had been used.
The underspending of grant allocations, accumulating customer and municipal debt, and inadequate progress in revenue collection across South Africa’s 257 municipalities remain a cause of concern for the National Treasury. This was outlined by the Treasury discussing the recently released Local Government Revenue and Expenditure report for the second quarter of the 2023/24 financial year (up until 31 December 2023).
Municipal spending on both operating and capital budgets accounted for 46.3%, or R283.5 billion, of the total approved expenditure budget of R612 billion. Revenue from billing and other sources reached 50.3%, or R310.9 billion, of the total approved revenue budget of R618.5 billion. Municipalities also set aside R154.5 billion for salaries and wages. This marks a R7.9 billion, or 5.4%, rise from the R146.6 billion budget allocated for the 2022/23 municipal financial
year. By 31 December 2023, R72.8 billion, or 47.2% of the allocated budget for salaries, had been used.