By Nangamso Mabindla
10 June 2004

DELIVERING his State of the City address at the East London City Hall on 10 June, Buffalo City Executive Mayor Sindisile Maclean highlighted key factors in the municipality's 2004/2005 budget.

This year's R1.6-billion budget, up from last year's R1.4-billion, was the third "pro-poor" budget presented by the mayor. "Despite being pro-poor, this budget does not overburden those who have means; neither is it business prohibitive," Maclean said.

Several factors had played a role in drawing up the budget, he said. These included a rising unemployment level, backlogs in basic services provision and pressures on health resources.

He assured the residents of Buffalo City that the municipality would face "these challenges head-on with political will and commitment", focusing on extending infrastructure and service delivery "while deracialising our City, which seems to remain locked in the wasteful racial paradigm of apartheid".

The mayor also assured those who had means to pay that they were not being overburdened.

The City's R174,5-million Equitable Share had been used to provide monthly social packages to 40 000 indigent families. "In cushioning the harsh and deepening poverty among our people, we have used our R174,5-million Equitable Share to provide a R118.80 monthly social package to 40 000 indigent families," he said.

The social package, for families who earned a combined monthly income of under R1 500, is up from last year's R110 a month. The package went towards subsidising services to these families, and Maclean urged those who qualified to apply for them.

"In providing this social safety net for the poor, we are not promoting dependency," Maclean added. "Our package for the poor gives our pensioners a 40 percent discount on their rates. The disabled are also catered for."

The mayor pointed to the municipality's success in providing free basic services: six kilolitres of water is provided free to more than 194 290 households monthly, while 90 272 households are provided with 50kw/h of free electricity - "reserved firstly for those classified as poor according to the figures used to calculate our Equitable Share".

The free six kilolitres of water cut the cost to every household by just under R20 a month, while the 50 kw/h electricity was sufficient power to burn a 100-watt bulb for 1 439 hours or a two-plate stove on high for 47 hours.

Maclean said that the budget had been balanced - despite an under-capacity in human and financial capital - through government grants of nearly R200-million and a R110,8-million loan to finance capital expenditure.

He said Buffalo City had also been awarded a R130-million Restructuring Grant "following a top-notch presentation to National Treasury". The grant is given to municipalities to assist in restructuring to improve administrative and financial performance.

In terms of upgrading depressed areas like Mdantsane, the mayor said massive injections of capital were being poured into its urban renewal programme. "The programme is also linked to our macro-industrial programme," he said.