By Thebe Mabanga
The Ekurhuleni Metropolitan Municipality has delivered a R65 billion no frills budget, with an improved credit rating and outlook, radically increased spending on maintenance as well as plans to get hostels and informal settlements to pay for the service they receive.
“From the outset, we seek to present a realistic budget outlook that can be practically implemented and monitored, taking into consideration the current state of our city’s environment,” finance MMC Jongizizwe Dlabathi said as he delivered the budget and the Medium-Term Revenue and Expenditure Framework.
Dlabathi noted that the budget spelt out how priorities announced by Executive Mayor Nkosindiphile Xhakaza in this State of the City Address almost two months ago would be funded.
Ahead of the delivery of the budget speech, Xhakaza who recently survived a motion of no confidence, took to the podium to announce that the budget, the first under his multi-party coalition government, corrected a misalignment of previous budgets which tended to allocate more resources to suburbs than townships—leaving service delivery gaps.
“This will not only be achieved solely through the budget as a tool, but equally a renewed commitment to serve and through the discipline of budget implementation,” Dlabathi said.
He said the budget was guided by the city’s six strategic pillars.
These include the provision of quality and sustainable services to all residents and rebuilding a strong financial base to support the city’s development. They also entail conducting essential repairs and maintenance of public facilities and investment on critical infrastructure in partnership with the private sector. The city aims to create jobs by revitalising the manufacturing sector and preserving good and ethical governance.
The budget was delivered against a backdrop of a revised outlook by Global Credit Rating (GCR), who this week affirmed the city’s status as a long and short-term bond issuer with ratings at BBB(ZA) for long term and A3(ZA) for short term.
The rating outlook has been revised from negative to stable. The metro says this reflects prudent financial management and reduced gearing, or debt ratio.
Dlabathi tabled a budget with a total revenue of R65,5 billion, an increase of 8.6 % from the R60.2 billion in 2024/25 adjusted operating revenue.
He said the revenue would be achieved through enhanced revenue management, improved debtor management and the city planned no new borrowing over the medium term.
“This budget statement further introduces a conversation about getting hostels and informal settlements to contribute towards the provision of some of the services we are currently delivering to them.” Dlabathi announced.
Total expenditure of R64,8 billion is projected, yielding as small surplus if achieved.
Dlabathi said expenditure would be subjected to spending within the allocated budget, linking spending to the provision of essential services and goods, implementing strict and, therefore, economical procurement and searching for “value for money”.
The metro will prioritise delivery of reliable supply of water and electricity with minimal interruptions and improve sanitation, including dealing with sewer spillages. Fixing potholes, streetlights, grass cutting and collecting waste will also be prioritised.
“These are the minimum drivers that bind us as public representatives, senior management and the entire labour force to do right on behalf of those we must serve. Failure to do so will result in service delivery regression and further public mistrust,” he said.
Dlabathi said the plans were guided by the desire to achieve financial stability by generating 90% of its own revenue internally, with only 10% derived from equitable share and conditional grants.
Improved expenditure management will also be key as is the recognition of tough economic times and their impact on the city.
“Manufacturing is still under immense pressure while finance and transport sectors emerged as key growth drivers,” the MMC said regarding the city’s economy which centred on being a manufacturing and logistics hub.
According to the Gauteng Treasury Socio Economic Review and Outlook 2025, “a gradual economic recovery is anticipated. However, lasting improvements will depend on addressing energy challenges, increasing infrastructure investment and creating a business-friendly environment.”
According to the S&P Global source, Ekurhuleni’s economy is expected to grow to 2.6% in 2027.
“While the unemployment rate decreased slightly from 37.5% to 36.9% in 2024 within the city, it remained the highest among the three Gauteng metros,” said Dlabathi.
“On the Debt Relief and Rehabilitation Incentive, we are proposing a 75% debt write-off on all the accounts that are 12 months and above for households. This is being increased from the current 70%. Furthermore, we are proposing a 10% debt write-off for business over and above the 100% interest write-off.”
The city has left property and cemetery rates unchanged for residents, while electricity rates will be raised in line with National Energy Regulator. There will 10% increase for sanitation to increase plant capacity and 15% for water. Sundry tariffs will increase by 4.3%.
The average comparative analysis of 2024/25 tariffs shows that Ekurhuleni came second with 10.43%, while the City of Cape Town approved the highest average tariff increase of 13.71%.
The employee compensation budget increases from R11,7 billion to R13,4 billion.
“This budget will give effect to the recruitment of 700 permanent cleaners and 290 permanent EMPD officers who will look after our strategic offices and buildings at a cost of R303 million.”
An allocation of R3.5 billion, representing 6.63% of property, plant and equipment is set aside for maintenance and repairs. This is below the National Treasury target of 8%.
A total of R1,4 billion will go towards infrastructure and equipment maintenance related to substations and network enhancement, while R946 million is allocated for roads and transport management.
The capital budget stands at R3,1 billion for this financial year, a staggering 14,2% more on last year’s adjusted budget.
Dlabathi said around 283,000 applicants were on the housing waiting list for Ekurhuleni. To address this, human settlement received R491 million for adequate housing and improved quality living environments to use across mega settlements, serviced stands social housing and RDP housing.
Dlabathi paid tribute to the late finance minister Tito Mboweni, who he recalled for reminding South Africa of its resilience using the aloe ferox as a metaphor, and late former finance MMC for Ekurhuleni, Moses Makwakwa.
INSIDE METROS