30/05/2013

ANNUAL STATE OF THE TOWN ADDRESS – EXECUTIVE MAYOR OF KNYSNA – COUNCILLOR GEORLENE WOLMARANS

Speaker, Executive Deputy Mayor, members of the Mayoral Committee, Councillors, political leaders, Municipal Manager, Directors and officials, distinguished guests, members of the public and the media.

Before we start the formal address, there are some special people in our midst today, whom I would like to point out to you.

Firstly, it is my pleasure to hand over two 25-year Long Service Awards to valued staff members today. They are Chief Clerk Licensing, Marionette Franzsen, and Elna van den Berg, who is an Accountant: Meter Reading. Thank you for your commitment and dedication to the Knysna Municipality and for the service you have ultimately made to the people of Knysna. As persons who work with the public, you are the face of the municipality and therefore play a very important rolein relaying a positive and efficient message to our customers. You are appreciated. Please come to the front. (handover envelope)

Next, I would like to tell you of two very special young men in our midst today. Wanga Mbabe, aged 17, and Bhekumuzi Hani, aged 16, are learners at Percy Mdala and Concordia High Schools respectively, and have been selected to represent South Africa at the RS Tera Sailing World Championships in Weymouth in the United Kingdom in July.

Wanga started sailing in 2011 and has showed promise from the start. In this season alone he has won three Junior trophies. Bhekumuzi only started sailing last year and had his first win only months later. This was a good season for him too with the Most Improved Novice Award, a junior trophy and a second place.

For these boys to be able to go compete overseas, they have to raise R100000 to cover all their expenses. They have been working very hard to not only perform in their sailing but also to raise the necessary funds. The Knysna Municipal Council today adds a financial contribution of just under R10000 to this cause and wishes you success in your future endeavours in sailing and in life. We know that you will be excellent representatives of Knysna and that, when you return, you will share your newly acquired life experience to the benefit of all you come in contact with. Please come forward so that you can receive your donation.

Every year when the annual State of the Town Address is presented, I am asked how long the speech is going to be. If you know me well, you will know that I am not really one for long speeches, so this year we are sticking to the basics – with only a quick glance over the past year’s highlights and a good look at the budget for 2013-2014.

As most of you will know, the 2012-2013 year had been eventful in many ways. It was the first year that the current political administration had worked with its own approved budget, and it was rewarding to see many planned projects take shape.

Among our achievements were several large scale projects for provision of water, electricity, sanitation and housing as well many smaller achievements that ultimately improved the lives of local communities.

These included:

  • The installation of significant electricity infrastructure including new intake sub stations, new transformers, fibre optic cables and hundreds of new electrical connections to homes and businesses.
  • Several water projects have commenced or are well underway including the Karatara River Weir Project, master planning of the total water reticulation system, the Rheenendal Water Augmentation Project and a crucial water pipeline that will provide improved water provision to the rapidly developing Northern Areas.
  • Upgrading and construction of roads and sidewalks in the Northern Areas as well as the greater Knysna Area. Sedgefield’s first proper taxi rank will also soon be open.
  • Construction of guard rails, wheelchair ramps and retaining walls in disadvantaged communities throughout the municipal area.
  • Extensive upgrades of Knysna Waste Water Treatments Works, installation of hundreds of toilets and the upgrade of several pump stations are soon coming to an end.
  • 294 low cost houses were completed over the past financial year, 320 new slabs have been cast and 300 properties connected to services.

The Knysna Municipality also annually contributes financially towards local charities, clubs and organisations via its Grant-in-Aid programme. The past year, more than 40 organisations received donations to the value of R747000.

The annual Mayoral Golf Day, which raises funds for the Mayoral Bursary Project, this year raised some R150000. The Bursary Fund annually assists promising local matriculants to further their studies.

It was also the first year of Knysna’s third generation Integrated Development Plan (IDP) and the first annual review of the IDP will be tabled for approval later today. The recent round of IDP public participation meetings have generally gone well and afforded us a good review of our communities’ development needs, wants and priorities.

The past year has also been the first full cycle for our Municipal Manager Lauren Waring who was appointed in March last year. Under her efficient guidance, two of the town’s Directorships – Corporate Services and Planning and Development - have been filled. The other two outstanding Directors’ posts – Technical Services and Community Services –shouldbe filled shortly. Council is looking forward to the results of having a full senior team at the helm in this coming financial year.

An increased focus on communication and customer relations has seen the creation of a new Communications and Customer Relations department within the municipality, and the creation of three new posts to initiate this service in-house. The Customer Care Policy, including a Customer Care Charter, was approved in March this year and the Communication Strategy is before Council today. Council’s corporate identity has also been refined and included the introduction of a new logo and related marketing materials. The municipal website, which had dated technologicallysince its inception in 2006, was re-launched in February to incorporate modern technology and more user-friendly interaction. It continues to develop with the needs and requirements of the municipality. We have also launched an SMS number for complaints, and for compliments!

The first, very-short-notice job of the then newly appointed IDP Manager, was the compilation of Knysna’s third generation IDP document. This was also approved in the past year, and as I have already mentioned, the first review of this process is also complete. The Provincial Authorities have commended our IDP as being a “best practice”. The IDP process, combined with increasingly functional ward committees,iscontributing to consistently improving interaction between the municipality and its communities. Council echoes national and provincial emphasis on the ‘whole-of-society’ approach in which not just government but all communities, business, organisations and institutions work together to tackle the intricate issues of our society and its development.

Another key appointment was the Manager Economic Development. The unit has been very active in several projects including the setting up of the Go Local Campaign and the Small Medium and Micro Enterprises (SMME) incubator project, as well as computer classes and assistance for unemployed youth, and the identification and activation of Rheenendal and Karatara as Comprehensive Rural Development Wards. The department has also started to revise the municipality’s economic strategy including a series of stakeholder engagements to inform the process and to engage private and public sector partners. We also just heard that a grant was secured to assist local farmers in developing a Fynbos honey co-operative enterprise in Rheenendal.

Of great importance are the 2190 direct jobs which were created by the municipality and 8540 ‘person days’ of casual labour was provided by the Parks Department. Human Settlements created more than 800 direct job opportunities as part of the roll out of houses.

The municipality has also reshuffled responsibilities within the Community Services Directorate to place more focus on youth and sports development. The Head Disaster Management and Social Services will oversee services of a new Social Services Officer, who will be appointed within the next while, and who will be managing all the municipality’s social services functions. Four youth officers will also be appointed on a one-year contract basis to improve the youth services portfolio.

Another major highlight has been the launch and implementation of the Knysna Estuary Pollution Action Plan which has been lauded for the municipality’s efficient coordination with other stakeholders and government departments. Implicitto this plan, as you may know, is the ongoing upgrading of the Waste Water Treatment Works and the recently implemented Stormwater and Sewerage Audit. We look forward to the long-term implications of significantly reduced pollution into the Knysna Lagoon, which remains one of our most important natural resources.

Of course, we also saw changes in Council, with the resignation of the Speaker, Mr Richard Dawson who took up a position on my Mayoral Committee, the appointment of former Executive Deputy Mayor Michelle Wasserman to the position of Speaker and the appointment of Councillor Esmé Edge as Executive Deputy Mayor. We also welcomed Councillors Ray Barrell and Stephen de Vries to Council.

Council also appointed the Knysna Municipal Public Accounts Committee (MPAC) in February and has already held several meetings to compile its first Oversight Report.

As a bit of an aside, but very much part of the municipality’s activities in the bigger picture, I also mention the annual Knysna Oyster Festival, which takes place this year from 28 June to 7 July. The town’s biggest festival celebrates its 30th Anniversary this year, which is also of course known as the Pearl Anniversary and therefore has extra special meaning in the Oyster Festival town. As it has grown through the years, this festival has consistently injected a welcome economic injection into the town in a time that would otherwise be dire, and raised much needed funds for local charities. The festival organisers have also informed me that this year’s festival has several more events happening in our previously disadvantaged areas, which will also bring welcome income and exposure to those communities. Many of our services divisions work extra hard in this time, and I use this opportunity to thank each one of you. Your great attitude and willingness to serve have been commented on many times in the past, and I appreciate the contribution you make to the wonderful atmosphere and good image of our town.

The last thing that I would like to mention before getting to the budget, is the noticeable increase in protest marches over the past financial year. While Council was often asked to intervene in some way, not all the marches were related to municipal service delivery issues. In fact, many surrounded issues of education, private land matters, transport, and safety and security. We understand this, as local government is at the coalface of government and our communities turn to us for assistance irrespective of who the competent authority is. Where issuespertained directly to municipal matters, the municipality has made every effort to address them within the constraints of budget and resources. Others, such as housing, the municipality has engaged with the relevant provincial and national departments in an effort to speed things along. Despite increasing frustration and difficult financial and socio-economic circumstances, the Knysna Municipality continues to strive towards excellence in all aspects within its mandate. Council continues to believe that bit-by-bit we are winning the battles and that ultimately our town will be a place where people and nature prosper.

Now for the Budget, also referred to as the Medium Term Expenditure Framework or MTREF.

The Budget

The budget for the financial year 2013/14 is the third budget of the current political administration but only the second that the ruling party can truly call their own – as the first, in 2011/12, was designed by the previous Council in the election period ahead of the 2011 municipal elections.

The priorities reflected within this budget are now fully aligned with the strategy and priorities of the Democratic Alliance within the Province of the Western Cape, as well as the National Development Plan. While changes in policy and direction cannot simply happen overnight, there have been significant shifts in Council thinking yet maintaining at all times a synergy with the Constitutional requirements of local government, in respect of basic services, and within the general dictates of National Treasury guidelines.

This budget continues to fight the difficult situation that the Knysna economy continues to find itself in.

Considering the unlikelihood of the economic position changing much in the next three to four budget cycles, at least, the budget follows a conservative approach to rates and tariffs but also slowly begins to plan in anticipation of improved economic conditions from 2017/18.

The new budget for Knysna Municipality amounts to some R608-million in 2013/14 of which R76-million is allocated for capital expenditure and R532-million for operating expenditure. The previous budget,which was approved for the past year (2012/13) was R71-million and R490-million respectively, which means this new budget represents an increase of 8.4% from the 2012/13 approved budget and 6.1% from the 2012/13 adjusted budget.

To address ongoing concerns regarding a lack of in-depth, long term planning for the Knysna area over the next 20 to 30 years, the municipality has decided to begin a new long term planning process, predominantly in-house, by means of a very exhaustive but inclusive Integrated Spatial Development Framework (ISDF).

The proposed ISDF will become the most critical long-term planning tool of the Knysna Municipality. The word ‘Integrated’ is quite key here as this framework will probably for the very first time have technical, financial, environmental and ultimately economic planning talking to each other. The ISDF looks beyond the five-year frameworks of the Integrated Development Plan (IDP) and, while no specific capital projects have yet been identified for ISDF purposes, they will obviously also be part and parcel of the revised IDP.

Despite on-going economic concerns, the Knysna municipal area continues to grow and with it the demands of all its residents. In recent years the demands for services have continued to increase from those areas where services and service standards were historically poor in comparison to more advantaged and well established areas.

This is exactly why the constitutional mandate of local government places the emphasis on basic services and is therefore the current and future reality of Knysna and of every other local authority in South Africa.

While more affluent residents must accept that areas that were neglected in the past willcontinue to take a large slice of the pie, those in poorer areas will have to recognise that reaching the advanced service levels of other areas will be a timely and costly exercise that cannot happen overnight and not without substantial financial cost. To believe that all areas can reach the same levels and standards within twenty years is simply naive and not grounded in financial reality.

Knysna, from a financial perspective, is a municipality that remains heavily geared, that is, we have a high number of borrowings and are heavily dependent upon thedomestic sector. Knysna was, is and shall remain for the foreseeable future a residential municipality. Approximately 80% of Council revenue, excluding governmental transfers, comes from the domestic residential sector.

There is little scope for cross-subsidisation from the business sector in relief of the domestic account and therefore increases in tariffs impact directly upon domestic consumers and hence almost immediately upon the municipality’s cash flow. Increased taxation will invariably mean increased non-payment.

Knysna is a holiday destination and a retirement town. Many Knysna property owners do not actually live in the municipality for home purposes and so generate little in the way of economic development throughout the year. However, Knysna must fund itself and provide services as if it were a twelve-month municipality while in reality it operates on at best six months’ revenues. There is therefore an obvious mismatch between revenues and service demands, and that is before we can consider eradicating or at best minimising the service backlogs in our previously disadvantaged areas.

The continued poor economic conditions mean that Knysna needs to maintain its fiscal discipline. In December 2012, Council took the decision to write off what overR30-million in service arrears and to introduce a far more stringent approach of recovering service charges and arrears via the prepaid electricity system.