via Council adopts 2015 budget…tariffs go up by 4% – Radio Dialogue October 23, 2014 by Lesley Moyo
The Bulawayo City Council (BCC) has adopted a $158 million 2015 budget with tariffs set to be increased by a marginal 4 percent, as the local authority strives to improve service delivery.
The proposed expenditure budget is pegged at $107 million and the capital budget at $51 million.
This will be the first time in two years that council has proposed to increase tariffs.
Announcing the proposed budget at a special meeting on Thursday, Chairperson of the Finance Committee, Councillor James Sithole, said the council’s budget performance over the years has been affected by various factors.
“The economy is still characterised by low aggregate demand, low wages, low productivity and high levels of unemployment. These factors unfortunately, have a negative impact on council’;s budget performance as residents and companies are finding it difficult to settle their bills on time,” Councillor Sithole said.
Council embarked on two budget consultation exercises, in August and September, where residents and other stakeholders were given an opportunity to contribute to the crafting of next year’s budget.
During the consultation meetings, in the city’s 29 wards, council officials presented a two budget proposals, one was pegged at $102.6 million with no increase in tariffs while the other proposal pegged the expenditure budget at $107.2 million with a 4% tariff increase.
In both scenarios, the capital budget was set at $50 million.
Councillor Sithole, revealed that residents were in support of the latter budget, which will see each household forking a maximum of about $2 more in rates.
“Of the 29 wards, 21 accepted the 4% increase proposal, 7 wards opted for a standstill budget and one ward indicated they will go with the majority. The 4% increase which balances the budget at $107.2 million was adopted as the proposed budget.
“Your worship, council needs funding in order to improve services to its residents as some infrastructure need complete refurbishment and replacement. This means council has to look for alternative ways of funding such as Public-Private Partnership,” said Sithole.
He said the marginal increase in tariffs was brought about by the high cost of inputs, such as fuel and the demand of improved service delivery by residents.
The City Hall and Tower Block which house council offices are powered by generators, after the Zimbabwe Electricity Supply Authority (ZESA) disconnected electricity supplies due to huge debt.
“The council therefore is recommending a marginal increase in tariffs of 4% with effect from 1 January 2015. While the proposed increase will mean ratepayers paying more for services, it is intended to improve service delivery,” said Sithole.
The proposed capital budget, will fund the replacement of obsolete machinery.
“This budget seeks to replace plant and related equipment that are used in the servicing of stands, road construction, acquisition of service motor vehicles and medical equipment.
“Council infrastructure such as roads, sewer systems and water reticulation systems has outlived their life span and require rehabilitation,” Sithole said.
“Council intends to build community facilities such as schools, youth centres and libraries for new suburbs.”
Sithole also urged residents to settle their bills on time to enable the local authority to prove quality service.
The budget will now be submitted to government for approval.
COMMENTS
We accepted this 4% budget increase on the basis that they should improve services not to deviate it to salary increases.We are not happy that 58% of this budget is to be spent on salaries.In our meetings with the finance officials from BCC we highlighted this unbalanced status.They have to reduce the salary bill to about 40% of the total council budget.
I know that they gave a silly explanation that most of their activities are labour intensive eg digging of graves,roads maintenance and others.They claimed that office staff only take 18% of the budget which in my opinion is questionable because they did not tell us how many are employed in the offices.If the number is less than a 1000,then they are over paying themselves.
The residents made it quite clear that poor performance is not acceptable,therefore we were given toll free numbers for monitoring departments and for followups on complaints.
We supported this marginal budget increase because no budget is static in this changing world ,however we made it clear that this should be matched with improved services delivery eg street lights to be repaired,sewage system to be maintained properly including water supplies.
The finance and heads of departments personnel promised to deliver on these services and they gave us toll free cellphone numbers to be used for complaints and followups.We are going to ensure that this is done in the coming year.
Personally,I was not happy with the 58% of the total budget allocated to salaries.When I queried that they gave me a funny reply to justify this high percentage,mainly that their jobs are labour intensive eg graves digging,roads repairs,sewage and others.They claimed that office workers use only 18% of the salary bill but they did not give us how many office workers are currently employed.If the number is below 1000 then I can conclude that the average salary per office employee is reasonably good.They have to cut down on the salary bill to about 40% to make our city viable. At the current state this stands at about $63 millions of the total expenditure budget goes to salaries leaving only $44 millions for maintenance projects.This is not acceptable,therefore they were advised to examine their future budgets properly.