Input is due by 14 April 2011

1. BUDGETS 2011-12 DCCI PRESENTATION 24 MARCH 2011 1

2. OPERATING BUDGET 2

4. Projected Inflation 6%

5. Salary increase 6%

6. Interest rates down

7. Collection rates average – 95%

10. Poor access to basic services

11. Poverty

12. Inadequate skills and literacy

13. crimeDevelopmental challenges City’s vision Africa’s most caring and livable City Densification Digital divide Ports and Logistics Key choices Public transport Our IDP Ecological integrity Eco tourism Sustainability Successful City Poverty/education Resource management Smart City Budget Employment, growing local economy, BEE, SMME Caring City Programmes to reduce increased poverty Democratic & equal city Access to info and knowledge Customer based city Non sexism and tolerant citizenry

16. Human Capital Development

17. Service Delivery Backlogs

18. Financial Sustainability

19. Water Crisis

20. Access to Public Transport

21. Economic Development

22. Energy Crisis

23. Health of Society

24. Food Security

25. Sustainable Spatial Form

26. Rural Development

27. Infrastructure Degradation

28. Undermining Natural Capital

29. Safer City

32. Free electricity to 70 000 households

33. Property rates exemptions to more than 116 000 poor households )

35. Expenditure on Public transport plan decreased by R262m

37. Salaries and allowances – R386m

38. Repairs and Maintenance – R191m

40. First 9KL free, no fixed charge for properties valued under R190 000

45. WATER - Targeting increase of : Residential 9,5% Business 12,5% - Umgeni Bulk Tariff Increase – 6.1% - Capital Expenditure – R1.86bn over 3 years (Previous 3 years R 3.83bn) - Maintenance R397m provided - Free Basic water remains 9KL per month - 690 000 customers - 175 000 households have access via water dispensers/standpipe - Reduced water loss from 37% to 30%, which translates to a R77m savings, mainly due to replacing aging infrastructure (over R300m provided 2011/12) - Collection rate 93%

47. Additional 10 000 water connections

48. Increase in maintenance: R 26.4m

50. Continuation of Water Loss Programme

53. Maintenance budget increased to R 661.3m

54. Collection rate: 96%

55. Upward trend in electricity budget due to extension and reinforcements of existing networks

56. R150m replacement of 11kv distribution switchgear for Metro area over the next 3 years

57. In excess of 15 Major new substations to be commissioned or refurbished to cater for increased electricity demand

58. Compliance with legislation requiring Smart Metering to be implemented by 2012 – Total Project value in excess of R68m

61. Provision for maintenance expenditure: R 261m

62. Sludge disposal initiatives: R 51.6m

64. Expansion of Hammarsdale , Phoenix, Northern and Isipingo Treatment Works

67. Gas to Electricity – Income (R 22.9m)

69. COMPARATIVE TARIFF INCREASES MAIN SERVICES

70. Water increase – includes takeover of Umgeni Areas. Electricity – Based on Eskom tariff increases - otherwise in line with CPI Elect CPI Rates Water

71. TARIFF INCREASE COMPARISONS TARIFF INCREASE COMPARISONS

73. Additional accommodation for 1000 hostel dwellers

74. The new development operating budget increased by 5% whilst the Hostel decreased by 1.23%

76. Upgrading of housing rental stock (R6.1m)

77. Hostels budget R240m

78. Reduction of the housing delivery program in view of reduced subsidies and the economic climate

79. 13 000 New Housing Units

80. The construction of houses is dependent on National / Provincial subsidies.

81. Over 149 000 homes delivered past 10 years

83. 15 Mobile Clinics

84. 2,3 million people being served per annum

85. Mobile air quality monitoring station established

86. Further develop street children programme

87. Further rollout of Family Health Care

89. Number of staff – 2348 permanent and temporary staff

91. 3 Satellite Stations

93. Grass cutting – 7 cuts provided for

94. Youth football development - R1m

95. Total staff compliment – 4036

96. Total Budget increased by R81m provision R 1263.3m

98. Over 4000 plans approved

99. Roads rehabilitation and maintenance – R 199m

100. Gravel road maintenance – R20m

101. Drains cleaning and maintenance – R 44m

102. Zibambele poverty alleviation project – R 62.4m

103. Full maintenance and cleaning contract on 400kms of high profile roads

105. Increase due to the focus on improvement of road network and infrastructure.

106. Focus on refurbishment and maintenance of existing road networks

108. Decreasing trend in 2010/11 due to reduction in PTIS Funds for Transport infrastructure increases in latter years.

109. Major projects include: - Area Traffic Control - Intelligent Transport System - Public Transport Fundamental Restructuring - Freight Management Infrastructure

112. Water Pipe Replacements Co-ops – 12 000 notional jobs created over a 3 year program

113. 36 WORKFORCE

115. Adult Basic Education Training (ABET) – R4.5m

116. Computer Literacy Development

117. Learnership/Apprentice/Skills Program – R5.6m

118. Management Development Programs (MDP) – R3.9m

119. Maximised possible trainee and apprenticeship programme in engineering,electrical ,accounting ,IT and all other professional fields

121. Agriculture – Projects include Soya Bean project, 20 Community Support Farms, Community Gardens, CottonlandsHydrophonicProject - Production of Mushrooms

122. Seedling and compost together expertise to be provided to communities to alleviate poverty

123. EPWP funding to be used to create sustainable food farms and forests

124. Soup kitchens – R 7m provided (Following slide has greater detail)

125. 39 EPWP Agriculture / Environmental Sector

127. Landfill Gas to Electricity Project, CER’s are sold to generate income –R28m income for carbon credits

128. Gas to electricity income – R22.8m

131. CAPITAL BUDGETS 43

133. National Treasury model utilised to determine 10 year Budget and to assist with prioritisation

136. TOTAL CAPITAL BUDGET R5 082.6M 46 CAPITAL BUDGET BY FUNDING SOURCE

137. 47 CAPITAL BUDGET-HIGH LEVEL SUMMARY

138. 48 MAJOR CAPITAL PROJECTS 2011/12

139. 49 MAJOR CAPITAL PROJECTS 2011/12

140. 50 MAJOR CAPITAL PROJECTS 2011/12

141. ECONOMIC INITIATIVES

144. ECONOMIC DEVELOPMENTPriority Nodes and Corridors Three areas of focus: The Durban CBD & Inner City Secondary CBDs Key Townships Nodes Inner City R1 billion worth of investment made in Durban’s inner city Urban Development Zone, reversing decay and contributing to city’s high-profile business and residential status Continued development of the Point Warwick Junction upgrade Priority Zone (high standard of urban maintenance) Secondary CBDs - Tongaat - Pinetown - Isipingo Increased focus on urban management and support to UIPs

146. Securing R720m from National Treasury as part of NDPG Programme

147. Bridge City mixed-use development

148. shopping centre operational; magistrates court & regional hospital being developed – R80m of NDPG funding spent

149. Mpumalanga Town Centre

150. R30m NDPG Funding spent and further R12m secured from COGTA

151. KwaMashu Town Centre

152. R40m spent and R20m to be spent next year

153. Clermont Kwadabeka

154. R45m spent and balance of R100m to be spent over next 3 years

155. Umlazi & Malukazi

156. R45m spent & balance of R200m to be spent over next 3 years

157. INK

159. ECONOMIC DEVELOPMENT Tourism Durban is the largest domestic destination in South Africa with projects in place to become one of the largest international tourism cities - played a major role in the growth of the city for decades Central beachfront upgrade which will see the Durban’s famous beachfront being remodelled, extended and transformed into a feature that will be a leading tourism asset to Durban and South Africa Development of the Inanda Heritage Route and Kingsway Tourism Corridor Pursuing of partnerships to focus on tourism development at Inanda and Hazelmere Dams Strengthening Umhlanga as a tourist node (development of the promenade & CBD improvements) The city has been listed as one of the top ten family beach holiday destinations in the world by a travel publishing heavy weight. The Soccer world cup produced an increase in visitor numbers and international exposure Some of the other major events planned to take place during the coming year are expected to have an overall socio-economic impact exceeding R1.2 billion. Securing of major events at the ICC such as COP 17 (Climate Change Conference) & Tourism Indaba Olympic Games 2020?

160. ECONOMIC DEVELOPMENT Poverty Alleviation Rural Development Framework & Strategy being implemented Investment in rural nodes (Kwa-Ximba, Inchanga, Umnini) Agricultural Projects being implemented Free basic services Informal sector support for survivalist businesses Expanded Public Works Programme (EPWP)

161. ECONOMIC DEVELOPMENT Trade and Sector Support Support to Micro enterprises SMME Fairs has grown significantly Partnership with SEDA Durban Tradepoint – to promote SMME export Sector Support through partnerships with industry in the following sectors: Automotive; Chemicals; Clothing & Textiles; Furniture; Film (including Film Mart); ICT; Maritime & Logistics.

162. ECONOMIC DEVELOPMENTMajor Government Projects Transnet Capital Programme Replacement of rolling stock Dig-Out Port – Transnet seeking partnership with private sector Multi-purpose Pipeline DubeTradeport – Development of AgriZone City’s Capital Budget King Edward Hospital Redevelopment Bridge City Govt Projects: Development of regional hospital and magistrate’s court

163. COP 17 Overview & Background The United Nations Framework Convention on Climate Change is an international treaty arising from the UN’s conference on Environment and Development. The treaty aims to stabilise greenhouse gas emissions to minimise their impact on the earths climate. The conference of the Parties (COP) is the governing body of the Convention, and advances implementation of the Convention through the decisions it takes at its annual meetings since 1995. The Kyoto Protocol expires in 2012 and it is expected that the extension of this protocol will form a key element of the negotiations at COP17. The COP/ CMP conference is one of the biggest international conferences. It will bring delegates from over 200 countries around the world to Durban. The official conference period is two weeks, (27th Nov to 9th Dec) with a week of pre-session meetings (21 to 27th Nov). Durban is expecting between 15 000 and 20 000 foreign visitors into the city for the conference as official delegates. Many more are also expected to visit to attend side events, exhibitions and meetings. Delegates include thousands of foreign press staff; dignitaries; business people; ministers and possibly heads of state.

164. COP 17 – benefits to the City The some of the main benefits to the City will be in the following areas: Huge international exposure – the eye of the world will be on the City. Tourism – Accommodation across all forms will be fully booked for the event period (This period is traditionally a quiet period for the accommodation industry) Strong benefits will be felt in our food and entertainment industry Curio’s and crafts will be bought Local tourist attractions will be visited on delegates days off The tourist transport sector will benefit from increased car hires, taxi trips, bus trips, tours taken etc Printing industry Despite being a “green” conference, hundreds of thousands documents and leaflets will be printed Conference industry The scale of the COP event and the range of side events will mean that Durban’s conference industry will have many opportunities Arts and Culture A range of social and other events are envisaged to be part of the COP event The city can showcase our organisational and infrastructural capacity – leading to future investment in the city. The city can showcase our environmental projects and programmes The potential to have a new environmental protocol named after our City – the Kyoto Protocol will make way for the Durban Protocol!

165. Examples of the possible benefits of this event to the city in numbers..... A minimum of 15 000 people – each staying an average of 8 nights (a conservative figure) = 120 000 accommodation bed nights = 360 000 meals eaten in the city = around 50 000 curio’s sold in the city = at least 50 000 metered taxi trips = probably over a million cups of tea or coffee sold = at least an additional 5000 people visiting nearby tourist attractions – most of whom will have significant disposable income. If the event goes well, 15 000 people who will go back home and report favourably on Durban as a destination of choice. Hundreds of thousands of media articles written mentioning the city

168. Impact of high electricity increase 65 OTHER CHALLENGES

169. IDP AND PERFORMANCE MANAGEMENT

170. IDP REVIEW What is an IDP? The Municipal Systems Act requires an IDP to be compiled and it is linked to the term of office for local councillors. During the course of the 5 year period the IDP is reviewed on an annual basis. It is a tool used by the Municipality to plan future development within eThekwini. It guides and informs all planning, budgeting, management and decision-making related to delivering services and development in the municipal area. The IDP process enables the Municipality to work with communities and other stakeholders

171. IDP REVIEW Vision: “Africa’s most caring and liveable city by the year 2020” To achieve the Vision the IDP is divided into 8 separate but related plans. The plans are supportive of each other thus ensuring effective delivery. The plans are as follows: Plan One: Develop and Sustain our Spatial, Natural and Built Environment Plan Two: Developing a Prosperous, Diverse Economy and Employment Creation Plan Three: Creating a Quality Living Environment

172. IDP PLANS CONTD Plan Four: Fostering a Socially Equitable Environment Plan Five: Creating a Platform for Growth, Empowerment and Skills Development Plan Six: Embracing our cultural diversity, arts and heritage Plan Seven: Good Governance and Responsive Local Government Plan Eight: Financially Accountable and Sustainable City

173. PERFORMANCE INFORMATION Performance Monitoring and Evaluation is a legislative requirement, and is a critical tool to measure Service Delivery in the Municipality It is a process which measures the economic, efficient and effective implementation of the Strategy (IDP) of the Municipality through the monitoring of Key Performance Indicators and providing an early warning signal for underperformance Accountability by the Political and administrative component of the Municipality is also ensured. Quarterly and annual reporting to Management, the Audit Committee and Council occurs to ensure an effective process.

174. IDP REVIEW – WAY FORWARD Public Participation Process: Advertised from 1 April 2011 Commenting period begins on 1 April 2011 Documents will be available from Municipality’s website (www.durban.gov.za) and Municipal libraries and Sizakala Centres. Deadline to submit comments 6 May 2011 Draft IDP to be amended, taking public input into account, during May 2011 IDP tabled at Council in June 2011 for adoption Adopted IDP to be then submitted to MEC for Cooperative Governance

175. ANNUAL REPORT

176. ANNUAL REPORT PROCESS All municipalities and municipal entities must prepare an annual report at the end of each financial year - Section 121 (1) of the Municipal Finance Management Act 56 of 2003 (MFMA) eThekwini Annual Report 09/10 was tabled at Council on 27 January 2011 Annual Report released for public comment in February 2010 Oversight Report of Annual Report process and final comments adoption by Council on 30 March 2011 Final print version of the Annual Report will be available by July 2011; the report is currently available on www.durban.gov.za

177. ANNUAL REPORT - OTHER Credit Rating – highest in the municipal sector Audit Report - unqualified Issues on SCM irregularities totaling R532m were raised - Expenditure deemed irregular ito procedure but not regarded as wasteful or fruitless , Main items as follows: - R91m iro acceptance of quotations not routed via the Bid Adjudication Committee(BAC) - Housing : R155m variation orders not routed via the City Manager . Also R18m for consultants accepted via quotations not routed via bid. Note that the Head: Housing had delegated authority , however, new SCM requires revised processes - R52m iro of contracts with employees of State, unbeknown to the municipality - R156m over expenditure on contracts not submitted to BAC - Reports to the BAC have been prepared to regularise this expenditure

178. THE END COUNCIL APPROVAL OF FINAL BUDGET 14 APRIL 2011

179. QUESTION AND ANSWER SESSION