Treasury is set to assist 100 municipalities that owe around R80 billion 💸 in water and electricity debt. TheCitizenNews Eskom loadshedding Read the story ⬇️
, government will fund these services in 2023/24 for 11.2 million households at a cost of R70.9 billion.But this money comes from the R96.5 billion in equitable share funding that is transferred to local government.
Using this funding for other purposes is a substantial contributor to the debts for bulk purchases of electricity and water of nearly R80 billion.Of the 257 municipalities in South Africa, a full 66 have been declared dysfunctional by the Department of Cooperative Governance and Traditional Affairs .In September, Treasury cautioned that 151 municipalities are on the brink of collapse. In the 2020/21 budget cycle, a full 106 municipalities – 40% – had adopted unfunded budgets .
In that year, 43% of its budgeted revenue, or R111 million, would come from “operational transfers”, in other words equitable share funding. This equates to R9.25 million a month – its wage bill. Everyone is looking to Finance Minister Enoch Godongwana and National Treasury to solve this shambles.Cogta has mostly been sleepwalking through all of this, as one failing municipality after the next is being taken over by Treasury.
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