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Municipalities fork out 25% of revenue for salaries

South African municipalities used 25% of their annual expenditure to pay salaries and other expenses for their employees in 2015, the Financial Census of Municipalities showed on Wednesday.

 

Since the boundary reform at the time of the municipal election of May 2011, there are now eight metropolitan municipalities, 44 district municipalities and 226 local municipalities.

According to the census released by Statistics South Africa (Stats SA) on Wednesday, municipalities spent a total of R289.3 billion for the financial year ended 30 June 2015.

Municipalities across South Africa received an income of R309 billion from all sources of income in 2015, an increase of R25.5 billion compared with R283.5 billion in 2014.

The largest contributor to municipal revenue, according to the census, was grants and subsidies received, followed by electricity sales, property rates received, and other revenue which consists of fines, licenses and permits, sewerage and sanitation, and refuse removal charges.

Of this R309 billion income, 25.6% (or R79 billion) was spent on “employee-related costs”, representing the largest contributor to municipal total operating expenditure.

Electricity purchases came in at 21.7% as the second largest expenditure for municipalities. This was followed by depreciation and amortisation at 9.3%, and other expenditure which consists of collection costs, loss on disposal of property, bad debts and ‘general expenditure’.

The report also showed that municipalities owed their suppliers and other creditors an amount of R197 billion, 11.6% more than in 2014. The provinces which showed the highest percentage increases of total liabilities between 2014 and 2015 were Free State, North West, Gauteng and Mpumalanga.

KwaZulu-Natal, Western Cape, Eastern Cape and Limpopo were the only provinces which contributed the least to the increase in total liabilities.  Source : ANA

 

 

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