Metro’s own revenue sources 94.98% of operating income in September
The metro’s own revenue sources constituted 94.98% of its total Operating Income in September this year, according to a report to be submitted to the Budget and Treasury Committee.
The 2014/15 Budget target is 83.49%, while the figure for September 30 last year was 79.38%.
The report points out that the higher the ratio is between own revenue sources and total operating income, which includes operating grants, the “less reliant” the metro is on national and provincial government to support its operations.
The report says that the metro is there-fore not totally reliant on the funding received from national and provincial government to support its day-to-day operations.
It adds that its equitable share of national revenue, for example, “greatly assists” the municipality to cover the Assistance-to-the-Poor (ATTP) subsidies.
It states that the metro “would like to become self-sufficient by not having to rely on government support via grants and subsidies”.
However, the report by Chief Financial Officer Trevor Harper stresses, “It has become very clear that without increased government funding the municipality will not be able to meet its service delivery mandate from its limited revenue base”.
The CFO says that as part of the municipality’s revenue enhancement initiatives all revenue sources such as fines and rentals charged for properties must be maximised to the fullest possible extent.
He says that the cost coverage ratio requires “close monitoring, scrutiny and improvement as the available investments cover only 1.06 months operating expenses”.
Harper adds that the 2014/15 Budget has been based on a cost coverage of two months with National Treasury expecting municipalities to move to three months over the medium term. - metrominutes
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