Statistics Act, 1999
R 385
Local Government: Municipal Finance Management Act, 2003 (Act No. 56 of 2003)Chapter 10 : Municipal EntitiesPart 2 : Financial governance87. Budgets |
| (1) | The board of directors of a municipal entity must for each financial year submit a proposed budget for the entity to its parent municipality not later than 150 days before the start of the entity’s financial year or earlier if requested by the parent municipality. |
| (2) | The parent municipality must consider the proposed budget of the entity and assess the entity’s priorities and objectives. If the parent municipality makes any recommendations on the proposed budget, the board of directors of the entity must consider those recommendations and, if necessary, submit a revised budget to the parent municipality not later than 100 days before the start of the financial year. |
| (3) | The mayor of the parent municipality must table the proposed budget of the municipal entity in the council when the annual budget of the municipality for the relevant year is tabled. |
| (4) | The board of directors of a municipal entity must approve the budget of the municipal entity not later than 30 days before the start of the financial year, taking into account any hearings or recommendations of the council of the parent municipality. |
| (5) | The budget of a municipal entity must— |
| (a) | be balanced; |
| (b) | be consistent with any service delivery agreement or other agreement between the entity and the entity's parent municipality; |
| (c) | be within any limits determined by the entity's parent municipality, including any limits on tariffs, revenue, expenditure and borrowing; |
| (d) | include a multi-year business plan for the entity that— |
| (i) | sets key financial and non-financial performance objectives and measurement criteria as agreed with the parent municipality; |
| (ii) | is consistent with the budget and integrated development plan of the entity's parent municipality; |
| (iii) | is consistent with any service delivery agreement or other agreement between the entity and the entity's parent municipality; and |
| (iv) | reflects actual and potential liabilities and commitments, including particulars of any proposed borrowing of money during the period to which the plan relates; and |
| (e) | otherwise comply with the requirements of section 17(1) and (2) to the extent that such requirements can reasonably be applied to the entity. |
| (6) | The board of directors of a municipal entity may, with the approval of the mayor, revise the budget of the municipal entity, but only for the following reasons: |
| (a) | To adjust the revenue and expenditure estimates downwards if there is material under-collection of revenue during the current year; |
| (b) | to authorise expenditure of any additional allocations to the municipal entity from its parent municipality; |
| (c) | to authorise, within a prescribed framework, any unforeseeable and unavoidable expenditure approved by the mayor of the parent municipality; |
| (d) | to authorise any other expenditure within a prescribed framework. |
| (7) | Any projected allocation to a municipal entity from its parent municipality must be provided for in the annual budget of the parent municipality, and to the extent not so provided, the entity's budget must be adjusted. |
| (8) | A municipal entity may incur expenditure only in accordance with its approved budget or an adjustments budget. |
| (9) | The mayor must table the budget or adjusted budget and any adjustments budget of a municipal entity as approved by its board of directors, at the next council meeting of the municipality. |
| (10) | A municipal entity's approved budget or adjusted budget must be made public in substantially the same way as the budget of a municipality must be made public. |
| (11) | The accounting officer of a municipal entity must by no later than seven working days after the end of each month submit to the accounting officer of the parent municipality a statement in the prescribed format on the state of the entity's budget reflecting the following particulars for that month and for the financial year up to the end of that month: |
| (a) | Actual revenue, per revenue source: |
| (b) | actual borrowings; |
| (c) | actual expenditure; |
| (d) | actual capital expenditure; |
| (e) | the amount of any allocations received; |
| (f) | actual expenditure on those allocations, excluding expenditure on allocations exempted by the annual Division of Revenue Act from compliance with this paragraph; and |
| (g) | when necessary, an explanation of— |
| (i) | any material variances from the entity’s projected revenue by source, and from the entity‘s expenditure projections; |
| (ii) | any material variances from the service delivery agreement and the business plan; and |
| (iii) | any remedial or corrective steps taken or to be taken to ensure that projected revenue and expenditure remain within the entity’s approved budget. |
| (12) | The statement must include a projection of revenue and expenditure for the rest of the financial year, and any revisions from initial projections. |
| (13) | The amounts reflected in the statement must in each case be compared with the corresponding amounts budgeted for in the entity’s approved budget. |
| (14) | The statement to the accounting officer of the municipality must be in the format of a signed document and in electronic format. |
