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  • Msimanga administration has a long-term plan to build on financial successes

    Msimanga administration has a long-term plan to build on financial successes

    Fri, Dec 8, 2017

    Reports alleging that the City of Tshwane has “approached National Treasury for help to draft a financial [recovery] plan” are misleading.

    The Executive Mayor has on numerous occasions highlighted the poor financial position inherited by this administration after the August 2016 local government elections. This is evidenced by the R2 billion unauthorised expenditure in the 2015/16 financial year alone.

    The City has, to date, made great strides towards stabilising its finances through strengthening control of supply chain processes, slashing unauthorised and unnecessary expenditure and extricating the City from unlawful and expensive contracts like the PEU contract, amongst other things.

    This has contributed to our successes in correcting the R2 billion deficit we inherited and has resulted in the surplus in the last financial year.

    It is common cause that a long-term financial plan is an essential tool that a municipality needs to facilitate financial sustainability and resilience and improve the municipality’s capacity to fulfil its developmental and service delivery mandate on a sustainable basis.

    National Treasury was approached to assist in developing a holistic long-term financial plan given that they had already engaged a service provider to assist in their oversight role.

    The simple fact is that the City approached National Treasury requesting use of existing tools within their purview that would be beneficial to us in our ongoing efforts to cultivate a long-term recovery plan so that we may build on our current success and continue to provide better services to the people of Tshwane.

    Reports suggesting that the City is seeking “rescue” from Treasury are simply not true and a product of not having all the information on hand.

    Nevertheless we have a duty to correct any misinformation in the public space and we do so to ensure that our residents and other stakeholders have the right information.

    Important progress was made to reduce such expenditure in the 2016/17 financial year and to stabilise the financial position of the City.

    The next important step was to compile a long-term financial plan to put a strategy together to shape the financial targets of the future City of Tshwane. The plan aims to align the City’s growth objectives to available resources and purposefully put measures in place to generate cash-backed internal surpluses to fund investment in infrastructure in future budgets.

    The plan is still in a draft stage and will, once finalised, be presented to the Mayoral Committee for consideration.

    Stabilisation efforts remain a priority for the Msimanga administration and misleading reports about the City’s financial position are as unhelpful as they are alarmist.

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