Finance
With reference to the Prince Albert Municipality’s allocation from the Western Cape Financial Management Capability Grant for the 2025/26 financial year:
(1) (a) What are the objectives of each of the following projects funded under the grant,
(i) Compilation of Long-term Financial Plan with Cost Reflective Tariffs, (ii) Revenue Enhancement Strategy with Indigent Verification System and (iii) procuring and installing of prepaid water meters and electricity meters, (b)(i) what is the current implementation status of each project and (ii) when is each project expected to be completed, (c) what measurable benefits have been observed to date as a result of these projects in terms of (i) revenue generation, (ii) cost containment or (iii) improved financial sustainability, and (d) what mechanisms are in place to monitor and evaluate the outcomes of these projects;
(2)whether her Department has identified any early indicators of success; if so, what are the relevant details?
(1)Sub-questions (a) to (c) are responded to below with respect to each of the listed projects:
Project 1: Funding for the Compilation of Long-Term Financial Plan with Cost Reflective Tariffs.
Implementation status and expected completion: Will be implemented in the 2025/26 municipal financial year (1 July 2025 to 30 June 2026).
Expected benefit: Currently the municipality needs funding to upgrade its sewerage network in the South End of town in the Prince Albert Municipality Area, where consumers still utilise
the sewerage suction system, which has become economically not viable to the municipality and at a very high cost to the consumers. The municipality is also charging trading tariffs, which is currently making losses
on the sewerage, electricity, water and refuse service, which will become economically unaffordable for the municipality in the future, in delivering these services as per constitutional mandate. If a long-term financial plan is compiled, the municipality will be able to determine its ability to take up external loans to co-fund its sewerage upgrade project, and to determine the cost of reflective tariffs will put the municipality in a position to recover cost from delivering the trading services mentioned above.
Project 2: Compilation of a Revenue Enhancement Strategy with Indigent Verification System.
Implementation status and expected completion: Will be implemented in the 2025/26 municipal financial year (1 July 2025 to 30 June 2026).
Expected benefit: Currently, as per Auditor General’s Report, the municipality needs to compile a revenue enhancement strategy coupled with an indigent system verification system.
This will allow the municipality to conduct accurate billing on all services utilised, proper contract management on rental stock, and determine properties which are utilised for multiple purposes, and are currently incorrectly categorized and billed. The indigent verification will also allow the municipality to ensure that indigent households that are according to the municipal approved indigent policy, receive the subsidy legally.
Project 3: Procuring and Implementation of Prepaid Water Meters and Electricity Meters.
Implementation status and expected completion: Will be implemented in the 2025/26 municipal financial year (1 July 2025 to 30 June 2026).
Expected benefit: Currently the municipality has two (2) towns (Leeu-Gamka and Klaarstroom) which are provided with electricity by Eskom. This creates serious problems for the municipality in implementing its credit control and Debt Collection Policy. The municipality will be in position to convert the conventional water meters of defaulting costumers in the above mentioned two (2) towns with prepaid water meters. The municipality will also be able to convert conventional water and electricity meters of defaulters to prepaid water and electricity meters, in the Prince Albert Town Area, where the municipality is the service provider of both water and electricity.
(d) Municipalities report on spending of the funds and implementation of the projects monthly and quarterly to the Provincial Treasury. Provincial Treasury closely monitors these reports to ensure projects are implemented and the funds are spent in line with the approved business plan of the municipality. At the end of the project, a close-out report is submitted to the Provincial Treasury which details the outcomes of the project.
(2) As the funds are only planned to be transferred and spent in the 2025/26 municipal financial year which begins 1 July 2025, it is too early to identify such indicators of progress.
