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Municipalities underspent their total budgets by R18.9 billion in the 2009/10 financial year, which ended on 30 June 2010, says National Treasury.
In comparison to previous years no improvement in the level of underspending has been noted. In the year 2008/09 aggregate net under spending was 9.1 percent of the total municipal budget while it came to almost 8.9 percent of the total municipal budget in 2009/10.
Underspending of the operational budget across the municipalities was R10.6 billion, while overspending came to R2.1 billion.
"Underspending was highest (in percentage terms) in the Free State and North West at 18.8 percent and 11.8 percent," said Treasury on Tuesday.
Municipalities underspent their capital budgets in 2009/10 by R8.5 billion indicating weaknesses in the ability of municipalities to compile credible budgets or to manage the implementation of their infrastructure programmes.
As at 30 June 2010 municipalities in aggregate spent R196.6 billion of the R213.3 billion total adjusted budget, while they collected on the revenue side in aggregate 95.1 percent of R221.8 billion total adjusted revenue budget.
Metropolitan municipalities collected 92.1 percent of their billed revenue by the end of the fourth quarter of the total adjusted budget of R130.8 billion with Cape Town having collected the highest proportion of its budgeted revenue followed by the eThekwini municipality.
Nelson Mandela Bay recorded the lowest capital spending of the aggregated adjusted municipal capital budget amounting to R47.8 billion. Overspending occurred in eThekwini followed by Cape Town and the City of Tshwane.
Aggregated municipal consumer debts amount to R56.1 billion as at 30 June 2010 (unaudited) of which government's contribution represented 5.2 percent (or R2.9 billion).
Free State had the highest percentage of creditors outstanding for more than 90 days at 36 percent, followed by North West at 31 percent, Limpopo at 28.9 percent and the Northern Cape at 18 percent. - BuaNews
