1. BUDGET OVERVIEW: 2004/5 FINANCIAL YEAR By the Director-General
PRESENTATION TO THE SELECT COMMITTEE ON LOCAL GOVERNMENT & ADMINISTRATION
By the Director-General
Ms L. Msengana-Ndlela
15 June 2004

2. Contents Major Achievements: 1994-2004
Priorities for 2004/5 & MTEF Period
Local Government
Provincial Government
Conclusion 2

3. Major Achievements: 3

4. Major Achievements:
Dismantling of the apartheid state and establishment of a non-racial, democratic, unitary state
National & provincial election (1994, 1999, 2004), local government elections (2000)
Local government transformation: establishment of a progressive policy, institutional framework and regulatory environment conducive to developmental local government 4

5. Major achievements: 1994-2004 (contd…)
Key national priorities programmes: URP, ISRDP, FBS policy
Integrated governance 5

6. Priorities for 2004/5 and the MTEF Period6

7. Alignment to government’s broad strategic outlook - 2014
Building a people’s contract in efforts to create work, fight poverty and reinforce national pride
Improving the performance of the State
Addressing the two economies paradigm
Improving regional environment & implementing NEPAD 7

8. dplg Budget over MTEF period
Total approximate budget of R42,2 billion
Increase from R9,4 billion (2003/4 financial year) to R12,8 billion (2004/5 financial year), representing 35,8% increase
Utilization of 99,7% of budget for 2003/4 financial year
Expected amount of R14 billion and R15 billion will be allocated for 2005/6 and 2006/7 financial years 8

9. Local Government 9

10. Review of Local Government equitable share and formula
Equitable share transfer to municipalities amounts to R7,6 billion of the R12,8 billion allocation for this year
Major review of share and formula
Consideration of fiscal and funding instruments
Institutional capability of municipalities
Strengthening the revenue raising powers – national economic growth path 10

11. Infrastructure investment and job creation – expected benefits
Access to basic levels of service
Enabling environment for local economic development
Job creation – Expanded Public Works Programme 11

12. Infrastructure investment and job creation (contd…)
Municipal Infrastructure Grant (MIG)
Allocation of R15,6 billion over the next three years
Allocation of R4,4 billion for the 2004/5 financial year
Municipal Infrastructure Investment Unit (MIIU)
Focus on 21 rural development and urban renewal nodes 12

13. Free basic services and targeting the poor
Implementation of policy on FBS:
Water;
Electricity;
Sanitation; and
Refuse removal
Social security net
Finalization of the national policy on the indigent 13

14. Free basic services and targeting the poor – Practical Implications
Consideration of following practical steps:
Determination of the cost
Credible databases on poor households
Registration of currently unregistered poor households
Registration of businesses and households from where revenue is currently not being collected
Improving billing systems and other customer care infrastructure
Councillor interaction and public participation
Monitoring and evaluation 14

15. Other Local Government Transfers
South African Local Government Association (SALGA)
R55,1 million over the MTEF period
Municipal Demarcation Board (MDB)
R46,7 million over the MTEF period 15

16. Provincial Government16

17. Provincial Government
Develop Provincial Growth & Development Strategies (PGDS’s)
Alignment with the Integrated Development Plans (IDP’s)
National Spatial Development Perspective (NSDP) 17

18. Traditional Leadership
National framework legislation – 2003
Provincial-specific legislation – 2004/5 financial year
Commission on Claims and Disputes –
R6,3 million over MTEF period
National House of Traditional Leaders –
R22,8 million over MTEF period 18

19. Section 185 of the Constitution R30,2 million over the MTEF period
Commission on the Promotion and Protection of the Rights of Cultural, Religious and Linguistic Communities
Section 185 of the Constitution
R30,2 million over the MTEF period 19

20. Intergovernmental Relations
Proposals on the assignment of powers and functions to local government
Review of Schedules 4&5 of the Constitution
Draft Bill on IGR 20

21. Regional Environment and SADC
SADC Local Government Forum of Ministers
Technical Committee to the African Union 21

22. Conclusion Dedicated trouble-shooting unit
Broad priorities on governance
Practical implementation
THANK YOU 22