Knysna Council adopts 2024/2025 Budget

Knysna Council adopted the final Medium Term Revenue and Expenditure (MTREF) Framework Budget for the 2024/2025 financial year at its meeting held on 13 June. “A process of meticulous and collaborative planning has culminated in a document that will work for our residents and our municipal area,” said Executive Mayor Aubrey Tsengwa. “While it is a detailed and comprehensive document, there are a few noteworthy key focus areas.”

Focus of the 2024/25 MTREF Budget

  1. Council has approved a budget consisting of an operating revenue of R1,319 billion, operating expenditure of R1,229 billion and capital expenditure of R89 million.
  1. A total amount of R32.2 million has been gazetted by the Provincial Human Settlement Department for various housing projects in Knysna. R8 million has been allocated for the installation of serviced sites in Sedgefield.

Council has allocated R7.8 million of its funds to various housing programs that include retaining walls, emergency material, Wendy houses and temporary relocation, rectification, the relocation of erf pegs, addressing slippery soil and temporary toilets.

  1. The National Department of Energy has allocated R15.7 million through the Integrated National Electrification Programme for the electrification of houses in Hlalani and the upgrading of the Knysna Industrial substation.
  1. This final budget allows R3.5 million for the establishment of fire stations in Rheenendal and Khayalethu.
  1. The Expanded Public Works Programme Integrated Grant has allocated R1.2 million for the creation of jobs in various departments such as Parks and Recreation and Environmental Management. Council contributes funding towards this initiative in various departments through the Casuals Salary Budget.
  1. Reprioritised funds have been allocated as follows:
  • R2 million for the electrification of informal settlements in all wards;
  • R1 million for the establishment of the Municipal Court;
  • R250,000 for the installation of additional CCTV cameras;
  • R1 million for the Upgrading of Howard Street;
  • R730,000 for bulk sewer services in Dam-se-Bos next to the Uniondale Road in Ward 3; and
  • a further R100,000 Grant in Aid for the Knysna Animal Welfare Society.
  1. An amount of R 52.8 million is allocated to repairs and maintenance, of which R46.4 million has been allocated to Infrastructure Services.

Capital Budget

Tsengwa explained that the capital expenditure financed by own municipal funds amounts to R23.3 million, and a further R65.5 million from grant funding, spread across all directorates. “Augmenting other grants, the Community Services Directorate has been allocated R6.3 million to address challenges related to safety, fire brigade services, cemeteries, parks and recreation, halls and facilities. This budget also allocated R2 million from own funding to electricity distribution initiatives to augment other grants.”

Operating Budget

The final operating budget surplus for the 2024/25 financial year amounts to R25,7 million.

“We know that many of our residents and businesses are taking more financial strain than usual,” said Tsengwa. “This organisation is also operating under immense financial pressure. While we feel immense empathy with everyone who is in a similar situation, tariff increases for the new financial year are, unfortunately, unavoidable.”

The recommended tariff increases for the new financial year include:

electricity (15%);

water (5.9%);

sanitation (5.9%); and

refuse (11%).

Property rates will see an increase of 4.9% in all categories from the reduced rate in Rand applied in the previous financial year of residential and base rate, as well as businesses.

“Indigent residents, senior citizens and people living with disabilities may apply for a rates rebate,” he explained. “A gross monthly household income of R5, 500p/m qualifies for 100% rebate. These households also qualify to receive 6kl of water and 50kWh of electricity for free each month.”

Additional financial assistance will be given to households in the following income groupings, earning above the indigent household’s threshold.

Group A:         (R5,501 – R6,580) = 80%;

Group B:         (R6,581 – R8,780 = 60%;

Group C:         (R8,781– R10,980) = 40%;

Group D:         (R10,981– R13,180) = 20%

Changes to Agricultural Rebates

The municipality has strengthened the process of awarding agricultural rebates/exemptions to qualifying ratepayers. Effective from 1 July 2024, all qualifying bona fide farmers, including residents and businesses involved in farming activities, must apply to the municipality to be granted the agricultural rebate/exemption.

The criteria for qualification, as outlined in our municipal policy, will be communicated to all agricultural properties currently recognized in our billing system. These property owners are required to submit applications with all relevant supporting documents to qualify for the 75% exemption currently implemented. Failure to apply will result in the exemption being removed, and the property will be charged a residential tariff in accordance with our policy.

“We face a number of challenges,” said Tsengwa. “Yet, I believe that every challenge is simply an opportunity not yet recognised. We remain committed to not only remedying our current problems, but to improve where we already shine, and to work for the betterment of all the people of the Knysna Municipal area.

“Our team, led by the previous Municipal Manager, visited all wards and met with representatives from key stakeholders such as the Greater Knysna Business Chamber and ratepayers’ associations during the public participation phase of compiling this budget. This phase allowed all residents the opportunity to comment on and discuss the draft budget, and to deliver their input towards this final budget. Thank you to those residents who took the time to participate in this crucial process.

“Thank you to the Acting Municipal Manager, our Chief Financial Officer and his team, and the Budget Steering Committee for your efforts and dedication to compiling this new budget,” Tsengwa concluded. “I am confident that we have created a budget that will assist us greatly in addressing our challenges, achieve new heights, and build an inclusive, innovative, inspired Knysna.”