Although infrastructure in the eight metropolitan municipalities is crumbling, their recently approved budgets show little commitment to improving and extending existing infrastructure.
The underspending on capital projects, says Ratings Afrika analyst Leon Claassen, does not bode well for future service delivery.
In City of Tshwane, the council budget reflects only 5c for every rand budgeted for operational expenses.
In Ekurhuleni, which includes OR Tambo International Airport and an important industrial hub, it is 4.8c.
In Johannesburg the amount is 9.4c.
Cape Town has allocated 15.7c to the capital budget for every rand budgeted for operations, eThekwini 13.5c and Mangaung 12.1c.
Claassen says the benchmark set by National Treasury for the capital budget is between 10% and 20% of the total budget; only four of the eight metros achieve that for FY2024.
The capital budgets for these metros should be close to the upper limit of the benchmark (20%) to deal with backlogs.
A report by construction data service Industry Insight shows that over the decade ended 2022, Tshwane on average spent less than 10% of its budget on construction-related projects.
The other metros at least spent the lower limit of Treasury’s benchmark.
For FY2024 the total budgets for Johannesburg and Cape Town are R80 billion and R70 billion respectively.
The whole capital budget is not necessarily spent on infrastructure; it may be spent on other items necessary for the functioning of the municipality.
‘Buffalo City and Johannesburg are clearly focusing elsewhere, because their infrastructure spending is only 45% and 51% of their capital budgets respectively.’
Spending should be at least 60%.
In 2021/22 the metros spent 73% of the amounts in their capital budgets allocated to construction work.
In the first three quarters of the current financial year, Tshwane was at 17% of budget, with Cape Town at 62%.