The Makhado Municipality’s annual operational budget, tabled during a glittering function at the Makhado Show Grounds last week, shows an overall increase of roughly 5,2% from that of the operational budget for 2005/6. Although the overall increase in rates and taxes is seen as moderate, the municipality’s exorbitant salary bill (personnel estimates) is again reason for concern.

The operational budget totals R218 912 251 for the 2006/7 financial year and, apart from electricity tariffs to be increased by 5,9%, taxpayers will see an overall increase of 6% on all other rates and tariffs as from July 1 this year. The municipality’s salary bill for the next financial year will be R90 988 168, which is in the region of 42% of the total operational expenditure budget. The Mayor, Cllr Glory Mashaba, admitted that the municipality has, without a doubt, exceeded the accepted norm of 30% to 35%, which has been set by the National Treasury, but defended the amount by saying that the increase came as a result of the absorption of temporary staff, traffic personnel, the provision of a possible 6% salary increase, the filling of critical vacant positions and the application of the AA Tariff on travel expenditure.

But why so much for salaries, many ask?

For the 2006/7 financial year, Council will have to pay a total of 1 051 employees. This number comprises 73 councillors, six senior managers, 21 “other” managers, 22 technical and professional staff and 929 other staff members such as clerks and labourers.

The 73 councillors will eat R8,616 million of the available budget cake, while the six full-time senior members alone will take another R3,519million bite out of the budget. This leaves R87,469million for other municipal staff members.

Council’s operational budget will mostly be funded through government grants and subsidies, totalling R78,711 million. The other source of major income will be from electricity service charges, totalling R90,872million. Another R15,153million will be derived from water service charges.

The capital estimates for the 2006/7 financial year is R41 290 190, which means slightly less money is available for water, roads and sanitation than the capital estimates for the previous financial year (R41 638 251). The capital budget will be funded by operational income (R16 615 132), Municipal Infrastructure Grant (R21 247 000), Finance Management Grant (R1 428 058) and other sources (R2million).

Apart from the R1,5million made available for the renewal and upgrading of the road and storm water system and infrastructure at the new Makhado Crossing shopping centre, R2million was also made available for the improvement of all streets within Makhado (Louis Trichardt). Evidence of this can already be seen.

As for water and sanitation, the Vhembe District Municipality allocated R17million towards water-related projects, while money is also available for the upgrading of the town’s insufficient sewage system. This includes R1,5million for the upgrading of the town’s sewage treatment plant, R1,2million for the upgrading of the Vlei pump station and R600 000 each for the upgrading of the Eltivillas and Industrial sewage pump stations.

The assessment rate tariff for the 2006/7 financial year will be 9,17 cents in the rand of the site value of land or of the site value of any right or interest in land that is listed as ratable property in the 1994 to 2000 valuation roll. A 100% remission will be granted to the owners of agriculturally ratable properties held in private ownership. Furthermore, there will be a maximum assessment rate rebate of 40% to less affluent property owners and social pensioners who are 60 years or older and whose combined income does not exceed R42 000 per annum.