R350 grant budget

Finance Minister Enoch Godongwana. Image: Flickr.

Over 60 municipalities seek Eskom debt relief

Godongwana disclosed that more than 60 municipalities burdened with unpaid bulk electricity bills to Eskom have applied for debt relief.

R350 grant budget

Finance Minister Enoch Godongwana. Image: Flickr.

To cater for the growing pressures imposed by climate change on infrastructure, especially at the local level, government has created a resource pool to specifically respond to future disasters.

“In this regard, R372 million has been added to the Municipal Disaster Response Grant, while R1.2 billion has been added to the Municipal Disaster Recovery Grant, to cover the repair and rehabilitation of infrastructure damaged by flooding in February and March 2023,” Minister of Finance Enoch Godongwana said in November in Parliament.

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Municipalities apply for Eskom debt relief – electricity

More than 60 municipalities who owe Eskom for unpaid bulk electricity services have applied for government’s debt relief arrangement.

This was revealed by Minister Godongwana while delivering the Medium Term Budget Policy Statement (MTBPS) in Parliament.

“By October 2023, 67 applications had been submitted, totalling R56.8 billion or 97 % of total municipal debt owed to Eskom at end-March 2023. Twenty-eight applications have been approved; the remainder are being assessed and verified with provincial treasuries,” Godongwana said.

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The programme was announced earlier this year to assist ailing municipalities who are struggling to pay their electricity bills.

Revenue collection projected to decline

Revenue collection is expected to fall by some R56 billion below the 2023 Budget predictions, according to the National Treasury MTBPS.

The MTBPS notes that slowing commodity exports, slower growth, downward revisions of the tax base growth, slowing corporate tax collections and lower net VAT collections have all impacted tax revenue.

The 2023 Budget had projected collections would reach some R1.78 trillion but that has now been revised down to R1.73 trillion.

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“In recent years, revenue collection has benefited from a pattern of high prices for South Africa’s commodity exports. In the current year, commodity prices have fallen faster than expected and value added tax (VAT) refund claims have risen, resulting in revenue collections projected to be R56.8 billion below 2023 Budget estimates.

Government forges ahead with restructuring the State

Work is underway to reconfigure the structure and size of the State as part of government’s efforts to improve the efficiency and effectiveness of public spending.

“This MTBPS supports measures to lift our growth prospects over the medium term and restructures the State to become more effective,” Minister Godongwana said on Wednesday while delivering the MTBPS in Parliament.

Government is preparing a joint plan to rationalise departments, entities and programmes over the next three years.

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The Presidency, National Treasury, Department of Public Service and Administration and the Department of Planning, Monitoring and Evaluation are formulating high-level recommendations on programme and entity closures. – SAnews.gov.za