SPTC in P20million deficit
Onalenna Kelebeile | Friday November 13, 2015 16:10
He said the situation has been compounded by deficits from the previous years. The local authority has already received revenue support grant advance of P82 million for the whole financial year but the situation has forced them to request for additional funding and is still awaiting feedback.
“It is true that the financial outlook indicates that we face a P20 million deficit by the end of the financial year. If we can consume at the rate at which we have been doing, then the deficit is likely to shoot up. But if we can forego some of our services then the deficit will remain there,” he said.
He said the situation prompted them to request for additional funding from the ministry who sent a team to the council to assess the financial situation a fortnight ago.
“We are still waiting for a response and we are positive that we will be assisted, otherwise some services will be affected including staff salaries,” he added.
He noted that in that scenario they will be left with no option but to scale down their operations and concentrate on the most critical ones.
He further highlighted that the budget cuts that they experience in their estimates annually result in the council budget overshooting. This has exacerbated the situation that the council finds itself in, hence they need the revenue support grant to be increased, he added.
The situation has also forced the council to put in place stringent measures to cut down on utility bills to minimise costs. The local authority is. on a monthly basis, currently paying over P1million for water, P350,000 for telephone bills and around P600,000 for electricity.
He added that the council’s situation could not be rescued under the newly introduced Economic Stimulus Package (ESP) because the package is meant for projects that were not included in the budget.
“We have however, indicated to the ministry that we have the capacity to implement some projects under the prgramme,” he added.
When reached for comment Town Mayor, Amogelang Mojuta, said the council’s financial situation is much better though it is not exactly where they would like it to be.
“We hope that the ministry will assist us. We currently emphasise on prudent spending because we are surviving on advance revenue support grant. We received the grant for the whole year meaning that our 2016/17 budget allocation will be exhausted by the last quarter of this year,” he said.
Mojuta said although there is no official record that their appeal for additional funding will be granted, they are convinced that they will be successful.
‘If we fail then we will face a tough situation and we would have to see how prudently we use the little remaining funds to survive. We do not have any reserves as council that we can resort to except to pull funds from other votes,” he added.
He said the council has money to sustain it only up to the end of the year.