DURBAN

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DURBAN CHAMPIONING THE INDIGENT MAXIMISING
SERVICE DELIVERY CREATING HIGH-QUALITY LIVING
ENVIRONMENTS DRIVING INVESTMENT IN PUBLIC
INFRASTRUCTURE
MANAGING PUBLIC FUNDS PRUDENTLY
A PREVIEW OF THE 2008/2009 MUNICIPAL BUDGET
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CONTENTS
WE CARE, WE BELONG, WE SERVE
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FOREWORD FROM THE LEADERSHIP
Year-on-year, the challenges faced by
metropolitan authorities in South Africa becomes
increasingly more complex. Cities are seen as
havens for jobs, better livelihoods, access to
superior public infrastructure and business
opportunities by rural communities. Yet, it is
cities that face the biggest hurdles with this
population migration. The need for services
increases dramatically, placing great strains on
already-stretched municipal budgets. With this
rise in city populations, there is little
corresponding increases in terms of income for
the Municipality. Revenue increases from rates
and our trading services like water and
electricity are quite rightly capped within
acceptable national limits. Thus, our challenges
as a metro are immense. The demands created by
basic human needs are high, straining the
resources of a low-growth base in real terms.
Into our ninth year of the new millennium, many
indigent people still do not have access to
acceptable housing, water supply, sanitation and
electricity. It is within these limiting
financial constraints that eThekwini continues to
provide a vast array of public services
including housing, transport, water, sanitation,
roads, security, refuse removal, emergency
services, libraries, clinics, social services,
economic infrastructure and even opportunities to
local SMMEs. Concomitantly, our budgets are
developed with a specific pro-poor focus. At the
same time, we are committed to enhancing our
enabling environment to support business and
attract investment. Accordingly, we have created
the relevant platform infrastructure over the
years as well as increased bulk services for
business to utilise or access. Further to this,
we have a significant capital expenditure spend
of over R50 billion projected over the next ten
years. In addition, for the 2008/2009 financial
year, the repairs and maintenance portion of the
budget is 10.8, which is well above the norm for
any other local metro. As promised in our
inaugural brochure last year, we endeavour to
provide an annual update on our budget and its
related processes. Every year, we will choose a
specific aspect of our budget to highlight. Due
to the current discussions around the new
Municipal Property Rates Act (MPRA), which comes
into operation in the 2008/2009 financial year,
we will focus on providing some background
information on the Act and its implications for
the Municipality and the ratepayers of Durban. As
expected, misinformation has circulated, creating
dissent about the re-assessment of properties
from certain quarters. As we have been
reiterating, this process will provide market
parity in evaluations within the city. eThekwini
is a complex organisation as can be gleaned by
the services we provide, in addition to us
managing a R23 billion budget, and with over
18000 workers in our employ. Our budget process
is consultative and our strategic intent in terms
of the Integrated Development Plan (IDP) is
developed with all our stakeholders. Thus,
despite the sometimes overwhelming impediments
that face us in making Durban the most liveable
city in Africa, we always strive to create
solutions that benefits all our citizens. DR.
MICHAEL SUTCLIFFE MR. KRISH
KUMAR CITY MANAGER
CITY TREASURER
There are a number of interventions that
government, at all levels, has introduced to
better the lives of the poor and disabled.
Recently, the national Minister of Finance
lessened their financial burden by increasing
their grants. We have incorporated this principle
into our 2008/2009 budget. Some 108000 households
will be exempt from paying rates as opposed to
the 72000 households previously. Further,
government subsidises these households in respect
of free basic services. About 227000 (55) of
households will receive a reduction in rates.
Properties valued less than R400000 according to
the latest property valuations will be exempt
from rates if those households are headed up by
children or pensioners. Higher-valued properties
owned by this demographic will have rates levied
on the portion that exceeds R400000. This
consideration has also been extended to those who
are boarded on medical grounds or receive
government disability grants, allowing for a more
equitable and effective system of taxation. Our
Long-Term Development Framework (LTDF) clearly
maps out the strategy for the City over the next
twenty years. In an effort to achieve our 2020
vision, the LTDF details the complex development
priorities facing us. The essence of the LTDF is
to achieve a balance between meeting basic needs,
strengthening the economy, developing people
skills, and creating a technology base for the
future. In an effort to achieve our 2020 vision,
these four Strategic Focus Areas of intervention
need to be balanced and integrated. It is
mandatory that the Citys budget be a pro-growth
one that meets basic needs and builds on existing
skills and technology. We will continue to
balance the requirements of having a pro-poor
budget whilst funding infrastructure that
facilitates the creation of a strong
economy. MR. OBED MLABA MAYOR
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AN INCLUSIVE BUDGET
The creation of our municipal budget is a
consultative process. As this entails the
management of council funds, we liaise with civil
society and business. The budget is developed
within the framework of the Municipal Finance
Management Act. Added to this, it must align with
the Citys Integrated Development Plan (IDP).
Below is a description of the process.
Refinement of Operating Budget at Each Stage
CIVIL SOCIETY
COUNCIL
In compliance with the Municipal Structures Act
(1998) and Municipal Financial Management Act
(2003), our city budget is informed and aligned
to the IDP objectives. The IDP determines and
prioritises the needs of the community. The
budgetary allocations for both the capital and
operating expenditure are undertaken in a manner
that will not only ensure that our IDP outcomes
are achieved but also to ensure that our citys
2020 vision is realised. We have come a long way
in capital budgeting, away from departmental
budgeting. Currently the capital budget is
allocated according to the IDP eight-point plan.
During the 2008/09 IDP revision process, this
allocation process was further entrenched through
committing to make hard choices. In terms of the
operating budget we have made an excellent start
but are now more committed than ever to ensure
that critical operating budget resources are
prioritised in terms of stated IDP outcomes. More
importantly, the Performance Management System
(PMS) allows the municipality an opportunity to
monitor and evaluate individual and
organisational performance in meeting our IDP
outcomes and vision.
BUDGET
LEGISLATION
ADMINISTRATION
BUSINESS
THE BUDGET IS AN INTEGRATED PRODUCT DEVELOPED
WITH INPUT FROM MAJOR STAKEHOLDERS
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WINNING BECAUSE WE DELIVER

• DID YOU KNOW THAT WE?
• Delivered of 75000 housing units during the five
  year period 2002-2007.
• Provided 6kl of free basic water per month to
  965480 households (including apartments) in 2007.
• Extended water and sanitation (new service) to
  18000 households per annum
• Constructed 32km of new roads, 165km of
  sidewalks, 201km of gravel to black-top roads
  and
• 33 pedestrian bridges 2002-2007.
• Extended refuse-removal (new service) to 159000
  households per annum during the five year
• period 2000-2005.
• Provided 155188 new electricity connections
  1997-2007 and built 15 new major sub-stations
• 2003-2007.

The Municipality kept its winning ways
throughout 2007. Some of the achievements being -
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A LONG-TERM VISION
INTEGRATED DEVELOPMENT PLAN
OUR IDP VISION
R 1 676 437 225
The above pillars serve as the core guides in the
design of our operating and capital budgets for
2008/2009.
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A COMPLEX OPERATING BUDGET
KEY ISSUES

• RATES AND GENERAL
• Salary increase of 8.75.
• Provision for critical vacancies R80 million
  (includes 200 Trainee Constables, Fire Safety,
  IT, Health, Skills, Municipal Court, and
  Planning Development Staff.
• Interest on loans increased due to additional
  loans from DBSA being taken (R35m).
• Provision for Bad Debts (Increased by R200m).
• Additional Repairs and Maintenance (R157.9
  million).
• 95 collection rate.

• WATER
• Bulk purchases tariff increase 2 .
• Provision for Bad Debts R107 million.
• Salary increase of 8.75.
• Impact of Capital Projects (R1040.7m) on
  operating, e.g.. Western Aqueduct (R250m),
  Replacement of pipes (R100m).
• Water loss is currently at 36, targeting 30 for
  2008/09. (9 of the 36 represents leakage from
  mains and this is being addressed through the AC
  mains replacement project.)
• 95 collection rate.

• ELECTRICITY
• Eskom bulk purchase tariff increase 15.2.
• Salary increase of 8.75 and recruitment of
  skilled professionals.
• Provision for Bad Debts increased by R20m
• Rollout of Infrastructure to new areas /
  developments
• No provision for REDS implementation
• Levy of 2 cents per kwh. An additional R228.5m
  will be levied to consumers on behalf of SARS.
• 98 collection rate.

TOTAL OPERATING BUDGET R17.470 billion.
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GOING BEYOND OUR MANDATE
Salaries and Allowances This expenditure is
continually being reviewed and as a result the
percentage of Salaries and Allowances of the
total Operating Budget has declined steadily over
the years to an acceptable level of 27.6. The
placement of staff in accordance with the recent
restructuring process is near completion.
However, the Municipality will continue to look
at new ways of doing business, improving
productivity, implementing Business Process
Re-engineering (BPR) and undertaking
restructuring initiatives in order to maintain
this expenditure at acceptable levels.
Furthermore, in terms of the placement policy
negotiated with Labour, temporary Council
contract employees who were employed for a
continuous period of two and a half years (30
months) as at 1 April 2003 may be placed in
permanent positions.
KEY ISSUES AFFECTING THE OPERATING BUDGET
Unaccounted for Water (Loss in Distribution) Unacc
ounted for water is determined by comparing the
water purchase volumes with sales volumes. It is
estimated that for the 2008/09 year, the targeted
loss in distribution will be a reduction to 30
from current level of 35. The water loss
intervention programme to reduce the water loss
to more acceptable levels is continuing with
further funding provided to appoint specialist
consultants to assist the process and the
replacement of ageing infrastructure. Every
possible measure will be taken to curb the water
loss as this has an impact on the setting of an
affordable water tariff. The effectiveness of the
measures put into place will be reviewed on an
ongoing basis.
Unfunded Mandates The eThekwini Municipality
provide Health Services, Libraries, Museums, and
Housing. The reduction or non-payment for these
services by other tiers of government requires
the Municipality to allocate its own resources to
make up the shortfall.
Load Shedding - Electricity The recent load
shedding experienced throughout the country also
poses a challenge. As a broad assumption, a 5
reduction in energy (consumption/purchase) will
reduce the units gross income margin by R 95
million. In order to cover this potential
shortfall in income, Council will be implementing
a surcharge of 3 on electricity consumption with
effect from 2008-07-01. Council is in the process
of carrying out a load shedding-awareness
campaign to reduce consumption by 10. In
addition, more energy-saving light bulbs will be
distributed and the likelihood of
load-controlling geyser switches will be phased
in this year. The rollout of energy saving light
bulbs has already saved about 130MW for the City.
Regional Electricity Distributors (REDS) The
necessity for REDS is appreciated by Council.
However, the institutional framework i.e. the
public entity model may impact on the
Municipalitys funding given the significant
reliance in terms of both income and leverage for
credit control. The Council, however, supports
the SALGA position in this matter i.e. there must
be no impact on the finances of the Municipality
and it must not adversely impact on the
customers payment for services.
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PLATFORM INFRASTRUCTURE
Infrastructure Provision and Repairs and
Maintenance continues to draw a large proportion
of our budgets. Total expenditure for 2008/2009
is R1.62 billion -
OUR REPAIRS AND MAINTENANCE PORTION OF THE BUDGET
IS 10.8, WHICH IS HIGHER THAN ANY OTHER METRO
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PROVIDING RESOURCES

• The hiring of new staff for critical vacancies
  and salary increases of 8.75 with effect from 1
  July 2008 takes up a significant proportion of
  the Operating Budget.
• This expenditure is continually being reviewed
  and as a result the percentage Salaries and
  Allowances of the total Operating Budget has
  declined steadily over the years to an acceptable
  level of 27.6. The placement of staff in
  accordance with the recent restructuring process
  is near completion. Whilst provision has been
  made in the budget for the review and revision of
  grades, the full impact can only be determined
  once the grading process has been completed.
  However, the Municipality will continue to look
  at new ways of doing business, improving
  productivity, implementing Business Process
  Re-engineering (BPR) and undertaking
  restructuring initiatives in order to maintain
  this expenditure at acceptable levels.
• Furthermore, in terms of the placement policy
  negotiated with Labour, temporary Council
  contract employees who were employed for a
  continuous period of two and a half years (30
  months) as at 1 April 2003 may be placed in
  permanent positions. This expenditure has been
  partially funded based on the anticipated
  effective date of placement.
• As a result of the annualised effect of vacancies
  filled during 2007/2008, the use of temporary and
  agency staff and the provision for task
  regarding, the year on year increase on employee
  related costs is 13.1.
• The Salaries and Allowances Task Team will
  continue to monitor the top 150 earners and staff
  that receive overtime in excess of 50 of their
  basic salary. In order to comply with the Basic
  Conditions of Employment Act, staff that work
  more than 10 hours overtime per week will be
  investigated in order to reduce overtime costs.

The table below details the additional posts and
related operations that need to be filled
/undertaken in the 2008/2009 financial year (R300
million)
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SUPPORTING OUR COMMUNITIES
The following are selected highlights from the
departmental operating budgets for 2008/2009-
Free Basic Electricity Our Indigent Policy
enables us to provide free 50 kwh of electricity
to those customers who consume less than 130 kwh
per month. We adopted a self-targeted approach
whereby customers who believe themselves to be
indigent can apply, provided their average past
6-month consumption is below the 150 kwh
threshold.
Zibambele Poverty Alleviation The Council ensures
the empowerment of people in the community by
providing small municipal contracts for
grass-cutting, verge clearance, etc. There is
also a platform that the Council operates for
small co-operatives, providing administrative
assistance, along with guidance on business
issues.
Refuse Removal We have extended provision of the
service to newly-incorporated areas by using
community-based contractors.
Rehabilitation of Landfill Sites Planning and
development of regional landfill sites continue
to demand a substantial investment by the
Municipality to ensure that waste is
appropriately disposed off.
Critical Staff Vacancies We have provided for
R300 million for new employees with related
operations, including critical staff (R80m). This
is to increase our service delivery to the
public. Security staff is a large proportion of
this total.
Soup Kitchens This is one of our
poverty-alleviation programmes. We provide free
meals to the poor. We are currently servicing 18
sites.
Special Events We cater for a number of events
annually, including local and international
events. These include all our 2010 functions.
This includes your One Nations Cup, Durban Beach
Festival and Comrades Marathon, etc. Some events
are hosted in partnership with other entities,
including Provincial Government and the 2010 LOC.
Interest on Loans The interest is paid on an
additional DBSA loan of R950 million.
IT Network This cost is for the management and
maintenance of the IT infrastructure network
throughout the Municipality for the purposes of
using excess capacity to provide competitive data
and voice services to the general public.
Harbour Widening This includes a portion of the
cost for the demolition of the old sub-aqueous
tunnel.
Repairs and Maintenance Overall repairs and
maintenance amounts to R 1.62 billion for the
year, which represents 10.8 of the total budget,
which is above most metros in the country.
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A DIVERSE RANGE OF LINE SERVICES
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KEEPING TARIFFS REALISTIC

• In the light of the significant challenges in the
  roll out of basic services to all our citizens,
  tariff increases have been moderately above
  inflation.
• The spikes in water supply tariff increases are
  attributed to a high water loss and increases
  from our bulk water supplier
• The significant increase in electricity expected
  in 2008/2009 includes a 3 surcharge to cover the
  shortfall attributable to load-shedding.
• As a result of ongoing, fruitful negotiations
  with Government departments a higher collection
  rate is anticipated. Good progress has also been
  made with collection of old debts (including
  government departments), which is also reflected
  in this projection.
• Due to a focus on government departments and
  businesses that owe large amounts a higher
  collection rate is anticipated.
• A programme has been put in place to encourage
  water customers to pay their current accounts in
  return for a reduction in the debt they have
  incurred. The approach targets the poorer
  section of our society that own properties valued
  at or less than R100000. Due to this programme
  an improved collection rate is anticipated.

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A SIGNIFICANT CAPITAL BUDGET
FUNDING SOURCES (2008/2009)

• Did you know that
• We have the largest capital budget spend of any
  municipality in South Africa.
• We ensure communities become and remain
  sustainable in terms of livelihood is becoming
  one of the greatest challenges for the
  municipality. It is clear that sufficient
  resources are not available to eliminate all
  backlogs at the current service levels. Without
  additional sources of revenue, the Municipality
  had to consider alternative options. Various
  alternative funding options are being considered
  for inclusion in the Long Term Financial
  Strategy. Borrowings of R 950 million will be
  made during the year in order to accelerate the
  capital program, in an attempt to eliminate the
  backlogs.
• The projected capital expenditure budget for the
  2008/2009 financial year period is R 5.93 billion
  (2007/08 R 4.20 billion ) which is a growth of
  41.2 on that of the previous year.

R 4 765
R 3 583
R 3 380
TOTALS
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MANAGING LEGISLATIVE CHANGE
Section 3(1) of the Local Government Municipal
Property Rates Act, 2004 (Act 6 of 2004) and
section 62 (1)(f) of the MFMA determines that a
municipality must adopt and implement a rates
policy on the levying of rates on rateable
properties. The new rates policy was approved by
Council on the 11 February 2008 and complies with
the Municipal Property Rates Act. Thus, the
levying of rates will have an impact on the rates
individual property owners will pay with effect
from 1 July 2008. As properties are now being
assessed based on the market value there is a
shift in incidence. The cent in the rand
(randage) has been adjusted downward to
compensate for the higher values. In addition,
the impact on the indigent, pensioners,
disability grantees and lower and middle-income
ratepayers was considered to ensure a limited
impact. Revenue neutrality has been maintained
using existing income per category of property as
a base to calculate the rate randage for the new
year. The rating of property based on market
value has resulted in a minimal shift in
incidence between the different categories of
property. State property is now rated in
accordance with usage resulting in a shift to
other property categories particularly business,
commercial, as well as vacant land.
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A GOOD FINANCIAL RECORD

FINANCIAL STATISTICS 2007/2008
MONTHLY BILLING VERSUS PAYMENTS 2007/2008
Despite the increase in debtors, the payment/cash
collection rates have increased. The debtor
increase is due to interest charges and penalties
from historical debt and higher levels of poverty.

• The Municipality has yet again managed to
  maintain its excellent credit rating of A1
  (short-term) and AA (long-term) for the third
  year in succession, as published by the Global
  Credit Ratings Company. These short and long-
  term ratings are amongst the highest ratings
  accorded to local authorities in South Africa and
  naturally it will provide the Municipality with a
  sound financial platform to meet its economic
  challenges and service delivery targets.
• The factors influencing the strong credit
  ratings are as follows -
• The significant progress that we have made since
  transforming into a metropolitan municipality,
  supported by the Municipalitys experience and
  capable management team, and the prudent judgment
  displayed by the political leadership.
• The substantial and increasing level of spending
  by Council on the World Cup related and
  socio-economic projects, and the associated
  longer term benefits thereof.
• The Municipality continues to display a robust
  financial profile, characterised by strong cash
  generation and high liquidity levels.
• Key debtors ratios have remained fairly stable in
  recent years, while collection levels have
  improved.

DEBT LIQUIDITY 2007/2008

NOTE MUNICIPALITIES MAY DIFFER IN THE METHOD
USED TO DETERMINE KEY STATISTICS.
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COMPARING WITH OUR COUNTERPARTS
The following tables give a comparable indication
of residential tariffs between the various metros
for 2008/2009 -

WE PROVIDE A COMPARABLE BASKET OF SERVICES WITH
OTHER CITIES
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UNQUALIFIED FINANCIAL STATEMENTS

• RATIOS AND BENCHMARKS
• Assets/Liabilities Ratio 1.8/1.0
• Favourable and stable from previous year.
• BENCHMARK 1.01.0
• Current Ratio 1.4/1.0
• Favourable and has improved from previous year.
• BENCHMARK 2.01.0
• Gearing Ratio 1.4/1.0
• Favourable and has increased from previous year.
• BENCHMARK 1.02.5
• Consumer Collection Rates
• Rates 95.8
• Water 92.8
• Electricity 98.0

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STIMULATING THE LOCAL ECONOMY
The Durban ICC continues to be foremost
convention centre in Africa. Durban certainly set
the trend, as other cities in the country and the
continent at large, began to construct their own
centres. Further to this, the Durban ICC ranks in
the Top Ten in the world, having brought a number
of delegates to Durban through its hosting of
seminars, conventions and other functions.
Effectively, the ICC has paid for its
construction and its operating costs many times
over through its multifarious effects on the
local economy through spurring secondary tourism.
Beyond just municipal coffers in terms of
increased revenues, local hotels, restaurants and
other tourist-related infrastructure have seen
significant growth in turnover that can be
indirectly attributable to the ICC. Effectively,
it is a key marketing tool in the City, that
places us on the global map. As with any
infrastructure, evolution is key to maintaining
the superiority of its product. Concomitantly,
the ICC has nearly completed its expansion. It
has effectively doubled its convention space, and
can also be used as an indoor sporting facility
as well as a venue for musical concerts on a
larger scale. The total economic impact flowing
from the ICC business for the financial year was
R565.5m. Based on a multiplier of 4, which is
the commonly used factor in the meetings
industry, the total economic impact of the
business generated by the ICC equates to
R1.068billion. This effectively means that the
contribution of the Centre to the GDP of the KZN
province is almost 1 (0.58). Foreign exchange
earnings to the tune of R81million and a total
direct spend estimated at R267million were
generated from conference delegates. Overall
financial performance for the year was better
than budget, with total revenue at R73.3m against
a budget target of R54.9m. This was largely
driven off business levels for the first and
second quarters of the financial year. The
Municipality contributed R22m in the 2007/2008
financial year to the ICC.
This project has unlocked more than 160 ha of low
yielding sugar cane land, enhancing the concept
of the activity corridor as a business activity
node. It has effectively brought the workplace
closer to the workforce. It has promoted spatial
efficiency with regard to KwaMashu, Inanda
Ntuzuma and unlocked the development node of
Phoenix. The industrial usage of the area has
higher economic benefit than agricultural use and
has had a positive effect on land values of the
surrounding areas. The project created some 3500
jobs during the construction phase and some 13500
new jobs post development is expected in the
long-term.
From 2004 to 2005, uShaka was instrumental in
catalysing the growth of stagnant housing prices
in the Point area, which was experiencing
spiralling urban decay. Because of the
Municipalitys intervention, growth in the area
exceeded the national housing price index. In a
period of two years, increases of 200 was
achieved in the area. uShaka has catalysed
further growth in the area, specifically the
sweeping development of the Point Waterfront,
Canal System and the Small Craft Harbour. Because
of municipal intervention, an area that was once
in a state of decay, has now become an integrated
residential, recreational, tourist and soon-to-be
shopping destination. Over and above these
sweeping positive effects, uShaka continues to
receive international accolades for its truly
innovative design and world-class facilities.
Employing approximately 750 staff (including the
South Association for Marine and Biological
Research) , uShaka MARINE WORLD achieved 90 of
its budgeted footfall into the paid environment
in its first year at 1.2 million guests and 3.8
million guests into the whole park. On 19
September 2007 the controlling shareholder,
eThekwini Municipality, invested a further R157m
into the theme park for which 1617 shares will be
issued. These funds were used to settle the
outstanding capital loans with Citibank (R88m as
of 30 June 2007) and the Development Bank of
Southern Africa.
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READINESS FOR 2010
The new Moses Mabhida stadium will be a
world-class facility. Most prominent feature of
the new stadium, to be built on the site of the
existing football stadium, will be the 30-storey
arch stretching its entire length. Stadium will
be built on the site of the existing King's Park
stadium and has been designed as a first-class
multi-purpose sporting facility. The 100m high
arches will mark the centre of Durban's growing
Sports City Complex. Stadium will have a seating
capacity for 70000 people. Arches will have a
cable-car erected. Stadium will cover 320 x 280
square metres and will be 45m in height. Parking
for 10000 cars.

• COST IMPLICATIONS
• Will have a major impact on spending for the
  Municipality.
• Total cost of stadium R2.6 billion.
• National Government R 1.8 billion.
• Provincial Government R 0.3 billion.
• eThekwini R 0.5 billion.
• Financial impact of related infrastructure R4.0
  billion. (Still under discussion with FIFA LOC
  and National Treasury.)

Stadium Funding Infrastructure Transport. ICT. Upg
rading / Improvements. Operating costs.
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MEASURING THE ECONOMY
The local economy is affected by the performance
of the national economy, although recent
indicators suggest it is outperforming the
national one in terms of the Gini Coefficient,
unemployment rate and the Gross Domestic Product.
The national economy continued to enjoy growth of
around 4.7 during 2006 and is starting to reap
the benefits of sustained sound macroeconomic
management and structural reforms. In addition to
achieving the Accelerated and Shared Growth
Initiative (ASGISA) target of 4.5 per annum, the
country has also experienced 36 quarters of
uninterrupted economic growth. Presently South
Africa is ranked as the 18th most attractive
destination for Foreign Direct Investment
according to a recent international survey.
Massive infrastructure investment plans have been
announced by both the private and public sectors
for public transport, new power plants and
township renewal growth. Unemployment remains
high, but job prospects are amongst the highest
in the world for the second year running,
creating 200000 jobs between March 2006 and 2007.
In the first phase, between 2005 and 2009,
ASGISA seeks an annual growth rate that averages
4.5 or higher. In the second phase, between 2010
and 2014, an annual average growth rate of at
least 6 of GDP is targeted. GDP growth in Durban
has grown at an average annual rate of 3.9 over
the period 1996-2006 and has been consistently
strong and lagging slightly behind Johannesburg
and Cape Town. As reflected in the graph below,
the manufacturing sector in Durban is the biggest
contributor to the GDP growth, followed by
finance, trade and then transport. When
deconstructing the manufacturing sector in
Durban, the success is due largely to the
chemical, automotive, pulp and paper, wood and
wood products, and food and beverages components.
The Citys Economic Strategy acknowledges the
importance of these sectors potential for
growth, job creation and global competitiveness,
and has aligned appropriate medium-to-long-term
plans for further enhancement. The National
Governments new industrial-policy framework that
re-emphasizes the development of the countrys
manufacturing sector as the cornerstone of the
economy will also contribute to this sectors
growth. The introduction of the Dube Trade Port
and King Shaka International Passenger Airport,
the 2010 World Cup Soccer Competition, and the
major expansion plans around the Port of Durban
are the three main projects that will act as a
major catalyst to the Citys economy over the
next ten years.
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INVESTMENT IN THE CITY
Business Investment Marketing - Other targets
channels engaged Products developed
distributed Effective budget allocation in
synergy with other Units. Existing Business
Retention and Expansion - BRE rollout
continues South Durban Basin (SDB) Area 1 in
conclusion SDB Area 2 launched Multiple Chamber
partnership projects continue Strategic
businesses flagship investment projects in
ongoing engagement/aftercare. Foreign Investor
Support - Leveraging targeted work with other
spheres Agencies several fdi engagements held
3 large fdi enquiries converted 2 incubated on
site bids for more in progress. Business
Development in R293 Townships - Draft strategic
outline developed, but due to changes in Project
Managers, progress is slowed. Create a
Business-Friendly Environment - Ad hoc
interventions continue on a case by case basis,
but formal project outline now completed
(National Government assistance) project
manager engaged for roll-out, but progress has
slowed. Under-Capitalised Investment Development
- 3 projects being developed One in multiple
location aquaculture the other a large Umlazi
Business Service Centre the 3rd in computer TV
assembly. Business Investment Targeted
Incentives Strategy - Draft outline developed,
1st City work shop held but due to change in
Project Manager, plus HR constraints, progress
has slowed. AgriBusiness Forum PPP Forum
established Summits held Market Days launched
Strategy refined Amakhosi projects progressed
Newsletter launched breakfast workshops held
new staff capacity engaged. 2010 Eco-Dev Bus.
Opportunities Workstream - Team sourced
developed Strategy presented agreed
authorised engagements held action plan
presented in roll-out partnerships with
chambers other government spheres developed
new staff capacity engaged.
23
CARING FOR ALL OUR CITIZENS

• Ideally the City would like to deliver 20000
  units annually to deal with the housing backlog,
  however, due to yearly limitations on housing
  subsidies this is not achievable. Accordingly,
  the Municipality is in the process of developing
  an Accelerated Housing Delivery Model, which
  would involve securing funding from a range of
  sources which would inter alia involve the major
  financial institutions as well as the private
  sector and social housing institutions.
• The basic social package is an affirmation of the
  Municipalitys commitment to push back the
  frontiers of poverty by providing a social
  welfare to those residents who cannot afford to
  pay, because of adverse social and economic
  realities. The social package will also assist
  the municipality in meeting its constitutional
  obligations. However, in order for us to continue
  to deliver these services in a financially
  sustainable manner, all residents will have to
  pay for services over and above the free basic
  services provided.
• The estimated cost of the social package (i.e.
  income foregone) amounts to approximately
  R1074.8m for the 2008/09 budget year. This is
  mainly funded from the R1.6 billion equitable
  share from national government.

DESPITE OUR SUCCESSES, THE CHALLENGE TO PROVIDE
EQUALITY FOR ALL STILL EXISTS, BUT WE ARE
DETERMINED TO MAKE DURBAN A LIVEABLE CITY FOR
EVERYONE.
24
PROVEN CAPABILITIES

• SOME IT STATISTICS
• No. of faults processed per month 2 500
• No. of change requests processed per month
  500
• No. of PC users 7 000
• No. of daily transactions processed 1 000
  000
• No. of internet users 2 000
• No. of bills / inserts printed per month 2 000
  000
• No. of fines processed per month
  85 555
• A TECHNOCRATIC CITY

• OUR GLOBAL POSITIONING
• Sister cities twinned with Durban 12
• Active projects with sister cities 39
• Incoming international delegations 50
• Meetings with consular corps 26
• CIFAL training sessions held 2
• A COSMOPOLITAN CITY

• WATER AND SANITATION
• 11 000 km of pipelines.
• 725 000 units connected.
• 220 reservoirs.
• 8 000 km wastewater pipes.
• 27 wastewater treatment works.
• 280 pumpstations.
• A CITY THAT PROVIDES

• LINKING WITH THE PRIVATE SECTOR
• About R3.1 billion S.A. company new
  investments/expansions thus far.
• Business Retention and Expansion (BRE) project
  roll-out in SDB Area 2 of 3 in South Durban
  Basin (950 businesses directly assisted 16
  Action Teams launched new Business tools
  distributed).
• R1.7 billion foreign investment already
  confirmed/secured thus far another R2.5Bn being
  sourced/facilitated at present.
• Full investment promotion marketing plans
  converted and products rolled out for full
  Council benefit.
• Agri-Business Forum expanded various projects
  initiated. Ramping up to capitalise on Dube TP
  other flagship projects.
• Three new business development projects of R1.7
  billion being progressed.
• 2010 Eco-Dev Bus. Opportunities Work Stream
  plan confirmed, resourced being rolled out
  through partnerships.
• A CITY THAT ENGAGES WITH BUSINESS

• LIGHTING UP THE CITY
• Major Substations 99
• Distributor Substations 631
• Mini Substations 5461
• Brick Substations 2736
• Pole Transformers 4350
• Streetlights 200 000
• A CITY THAT BRIGHTENS YOUR DAY

WE ARE A COMPLEX ORGANISATION THAT DEALS WITH
COMPOSITE SOCIAL, TECHNICAL, FINANCIAL AND
ECONOMIC ISSUES

• SOLID WASTE
• No. of tons removed and disposed
  1 418 264 tons
• No. of houses serviced
  1.1 million
• No. of refuse bags distributed 43
  million
• No. of commercial customers 31
  000
• No. of wheeled containers skips
  80 000
• No. of landfill sites 3
• No. of transfer stations 8
• No. of garden refuse sites
  12
• Vehicle fleet complement
  424
• No. of re-cycling drop-off centres
  15
• No. of re-cycling buy-back centres
  7
• A CLEAN CITY

• FLEET AND PLANT
• Total vehicles serviced 2939
• Number of the targeted services 3696
• Ratio of artisans to vehicles. 1103
• Average vehicle availability 94
• Number of vehicles licenced 1695
• Income from hire pool R6.45m
• Income from disposal of vehicles R2.3m
• A CITY THAT WORKS

25
THE BUILDING-BLOCKS FOR SUCCESS
WE HAVE STRONG, PRAGMATIC MANAGEMENT LEADERSHIP
WITH PROVEN EXPERTISE IN MUNICIAL SERVICE
DELIVERY.
WE HAVE A PRO-POOR FOCUS IN TERMS OF
SERVICE-DELIVERY.
WE HAVE A STABLE EXPERIENCED ADMINISTRATION.
WE HAVE CONSISTENTLY APPLIED A STRATEGIC SPLIT
BETWEEEN OUR SOCIAL AND ECONOMIC EXPENDITURE.
WE HAVE THE HIGHEST CREDIT-RATING AWARDED IN THE
MUNICIPAL SECTOR.
WE HAVE A DEBTORS COLLECTION RATE CONSISTENTLY
ABOVE 95.
WE HAVE ACHIEVED MORE THAN 95 CAPITAL SPEND PER
ANNUM.
WE HAVE ACHIEVED CONSISTENT UNQUALIFIED (CLEAN)
AUDIT REPORTS.
WE RECEIVE REVENUE ELECTRICITY FROM LANDFILL
SITES, SIMULTANEOUSLY USING SUSTAINABLE
DEVELOPMENT METHODOLOGIES.
WE WERE THE FIRST MUNICIPALITY IN SOUTH AFRICA
TO ESTABLISH AN INTERNATIONAL CONVENTION CENTRE.
WE HAVE A STRATEGIC PARTNERSHIP WITH THE PORT TO
INCREASE EFFICIENCIES IN THE HARBOUR AREA.
WE HAVE REVERSED URBAN DECAY IN MANY AREAS IN
THE CITY.
26
A METRO THAT IS OPEN TO DISCUSSION

• Call us for discussions / advice on -
• Investor Services
• Business Support.
• Economic Services.
• Logistics Information.
• Land Acquisition.
• Infrastructure Provision.

OUR COMMITMENT TO YOU WE WILL RESOLVE EVERY
QUERY FROM THE PUBLIC AND BUSINESSES