As of 20 July 2015, Transport for Cape Town’s total actual expenditure plus contractual commitments amounted to R1,356 billion or 77% of the capital budget for 2014/15. In the previous financial year, TCT spent 79% of its capital budget and in 2012/2013 a record R2,5 billion which equated to 95% of TCT’s budget at the time.
As far as service delivery is concerned, TCT had 242 capital projects in the 2014/15 financial year. The vast majority of the under-expenditure, however, resides in only 15 of these projects that are largely part of the Public Transport Network Grant. Thus, despite the under-expenditure, the overwhelming majority of our service delivery projects were delivered or largely delivered: 227 out of 242 of them.
National Treasury requires that grant funding be included on the budget in the year in which it was allocated for – thus even though we never planned to spend all of our grant funding, we still had to include it on the budget. This creates the wrong impression that our planning was poor. This is not the case. Our planning was accurate but we did not want to refuse the grant funding since this would set us back in future years when the funding was needed.
Some of the under-expenditure was unplanned and beyond our control despite our best intentions and interventions, for example:
- Some contractors responsible for road rehabilitation projects have under-performed in the year under review, leading to under-expenditure. These contractors are being put to terms in terms of their contracts with the City and their contracts will be terminated if necessary
- Community disruptions at a number of housing development projects impacted on the bulk service provision of road and stormwater infrastructure to these developments
- Gang-related intimidation and violence hampered the progress of contracts underway for the upgrading of concrete roads in Bonteheuwel, Hanover Park and Manenberg
- In Gugulethu, community protests hampered a number of concrete road rehabilitation projects. Other disruptive protests also caused significant delays on the contract for the rehabilitation of a section of Klipfontein Road.
We have consistently reported to the members of the TCT Portfolio Committee – among them ANC Councillors – that we would not be able to spend the full allocation of public transport grant funding due to a number of factors beyond our control. Our partners in National Government have also been aware of the fact and have been fully supportive. In fact, they have demonstrated their support and confidence in our ability by already having agreed to roll over R200 million immediately. In normal circumstances, we would have to wait until the January 2016 Adjustments Budget for this to happen.
It is peculiar to me that the ANC complains about the underspend because the vast majority of this money relates to Phase 2 of the MyCiTi service – a project that we know the ANC is fighting tooth and nail to prevent us from implementing. We know this because the ANC is funding the litigation that the South Road Families Association has brought against the City.
We also know for a fact that the ANC has frequently and publically threatened to persuade the National Department of Transport to withdraw the grant funding earmarked for the roll-out of Phase 2.
Next year in the local government elections the DA will have a field day because we will inform those residents in the metro-south east how the ANC is preventing the City from bringing decent public transport to those areas.