Cape Town - Informal settlement upgrade projects and community facilities are set to bear the brunt of national budget cuts in the metro, as the City of Cape Town was forced to get “leaner and meaner” with its spending.
So cautioned mayor Geordin Hill-Lewis during a Council sitting on Thursday, to pass an adjustment budget brought on by a R107-million housing funding cut to the City as part of nationwide cuts to grant funding for municipalities and provinces.
The adjustment budget tabling follows Finance Minister Enoch Godongwana’s announcement, last week, of a R21-billion revised government spend for the current financial year.
Hill-Lewis said cuts to Cape Town’s national funding share included R37m from the Informal Settlement Upgrading Partnership Grant, and R70m from the Urban Settlements Development Grant.
“This adjustment budget is necessitated because of significant in-year budget cuts passed down to us by the National Treasury, and cutting specifically our grant funding for housing projects, informal settlement upgrade projects, and community facilities.
“This adjustment budget is being forced on us, it gives us no joy to have to table this and get it through Council today.”
UDM councillor Bongani Maqungwana asked Hill-Lewis about a back-up plan to counter further budget cuts in future.
Hill-Lewis said the local government had two sources of revenue – one raised through taxes, and the other, grants from the state.
He said when grants were cut, the two options available were to cut local expenditure, or increase taxes.
“I don’t believe that Cape Town or any families in South Africa are in a position to absorb major additional tax increases. So we have to be extremely careful and judicious about protecting family incomes.”
GOOD Party councillor Siyabulela Mamkeli said although the metro suffered budget cuts, the City additionally failed to deliver on services to poor communities.
Meanwhile, during the Department of the Premier’s 2023/24 Adjustments Budget Vote debate yesterday, Premier Alan Winde said the province declared an intergovernmental dispute.
“Our message to President Cyril Ramaphosa is simple: give us the R1.1-billion shortfall owed, not just to us but to our residents too, or we will have no option but to meet you in court.
“Not only will we have to precariously navigate our way through catastrophic budget cuts, but now the national government appears to be steamrolling ahead with the National Health Insurance Bill, which has been passed by the National Council of Provinces.
“We have on multiple occasions raised our concerns over this bill and its constitutionality. And in the face of this catastrophic fiscal crisis, we have to ask – how will we fund this?” said Winde.