2012/13 Municipal Budget and Benchmark Engagement

SALGA National Working Group

Presented by National Treasury: Chief Directorate Local Government Budget Analysis - 1st June 2012

Background

• To improve budgeting in LG by measuring performance among municipalities; identifying common trends and areas of risk;

• Trend analysis within the specific sector and municipal category/capacity;

• Early warning system – Lessons that may be shared;• Outcomes directly informed by the MBRR (Budget process) data

provided by municipalities;• Credibility, integrity and relevance of MBRR data remains a concern for

all municipalities; not merely a compliance exercise! • Credibility of data is critical in strengthening whole of local government

performance; and• To systematically improve the budget information of all local authorities

thereby ensuring sustainability within the municipal environment over the medium to long-term.

2

Outcome of the previous Benchmark Engagement: Summary of tabled 2011/12 MTREF - 8 Secondary Cities and 1 District

3

Compliance and Sustainability Measures

Rustenburg uMhlathuze Polokwane Mbombela Sol Plaatjie George Msunduzi O.R. Tambo Mafikeng

Tabled or Adopted Budget Tabled Adopted Tabled Adopted Adopted Adopted Adopted Adopted Tabled

 Compliance to Overall Budget Process: In accordance with the MFMA time schedule No Yes Yes Yes Yes No No No No

Political Oversight Undertaken Yes Yes Yes Yes Yes Partially Partially Yes No

Mid-year Review Undertaken No Yes Yes Yes No Yes No Yes Yes

Alignment of Budget with National, Provincial and IDP Priorities No Yes Yes Yes No No No No Partially

Provided Adequate Budget Assumptions Yes Yes No Yes No Yes No No No

Adequate Public Participation Process No Yes Yes Yes Partially Yes No No Partially

Backlogs Adequately Addressed as informed by available funding / funding constraints No Fair Fair No No No No No No

Ability to Borrow as part of the MTREF Yes Limited Limited Yes Yes No No No No

Status of the Cash flow / Liquidity Good Poor Fair Poor Poor Good Poor Poor Poor

Is the Budget Funded No No Partially No No Yes No No No

Is the Budget Multi-year Partially Partially No No No No No No No

Is the Budget Credible & Sustainable No No No No No Yes No No No

Outcome of the previous Benchmark Engagement: Summary of tabled 2011/12 MTREF – 8 Metro’s

4

Compliance and Sustainability Measure

City of Johannesbur

g

Cape Town eThekwini Ekurhuleni Tshwane Nelson Mandela Bay

Buffalo City Mangaung

Tabled or Adopted Budget Tabled Tabled Adopted Adopted Adopted Tabled Tabled Tabled

 Compliance to Overall Budget Process: In accordance with the MFMA time schedule

 Yes

 Yes

 Yes

 Yes

 Yes

 Yes Yes No

Political Oversight Undertaken Yes Yes Yes Yes Yes Yes Yes Yes

Mid-year Review Undertaken Yes Yes Yes Yes Yes Yes Yes Yes

Alignment of Budget with National, Provincial and IDP Priorities Yes Yes Yes Fair Yes Yes Yes Fair

Provided Adequate Budget Assumptions Yes Yes Yes Yes Yes Partially Fair No

Adequate Public Participation Process Yes Yes Yes Yes Yes Yes Fair Fair

Backlogs Adequately Addressed as informed by available funding / funding constraints Yes Yes Yes Partially Yes Partially No Fair

Ability to Borrow as part of the MTREF No Yes Limited Yes Yes No Yes Yes

Status of the Cash flow / Liquidity Poor Good Fair Fair Fair Poor Fair Poor

Is the Budget Funded No Yes Yes Yes Yes No Yes No

Is the Budget Multi-year Partially Partially Partially Partially Partially Partially Partially Poor

Is the Budget Credible & Sustainable No Yes Yes Yes Yes No Yes No

Common observations from the Tabled 2011/12 MTREF Budget and Benchmark Engagement

• Generally municipalities demonstrated the presence of a spatial development framework and that a formal spatial development unit/section exists within the municipality however there was very little evidence to demonstrate that the SDF indeed informs the IDP or MTREF;

• Nine secondary cities applied an incremental budgeting approach instead of the required multi-year budget approach particularly in respect of the operating budget appropriations of the MTREF’s two outer years;

• None of the seventeen non-delegated municipalities fully complied with the MBRR;• Mayors and Councillors are not adequately informing communities of the IDP, MTREF and

SDBIP and relevant municipal policies hence there is limited community buy-in for the MTREF;

• Poorly constructed indigent policies, ineffective implementation and poor data integrity result in the municipalities providing free basic services to households that are not entitled to such benefits;

• Ineffective debt collection processes, incorrect billing and inaccurate data impedes the municipalities’ ability to bill and collect revenue; consequently there is greater reliance on grants as well as borrowing;

• The continued increases of above 20 per cent in the Eskom bulk tariff is negatively impacting on the operating statement of all municipalities. Affordability challenges in relation to electricity, the negative impact on defaulters and the subsequent increases in debt impairment provisions, all of which are counterproductive, is of concern;

5

Common observations stemming from the Tabled 2011/12 MTREF Budget and Benchmark Engagement – Continued

• With the exception of six metros, municipalities are weak at tariff setting and ensuring cost recovery particularly in respect of trading services. In many instances the services are trading at loss and this will have to be addressed as a matter of urgency;

• Cash flow forecasting, funding compliance and funding measurement remains exceptionally weak and is an area that requires attention. The exceptions are Cape Town, eThekwini, Tshwane, Buffalo City, uMhlathuze and Mbombela;

• Depreciation, asset impairment and debt impairment do not receive adequate provision within the statement of operating performance and in many instances is utilised to balance the operating statement;

• There is evidently a lack of understanding of the funding requirements of the municipal budget. The exercise of ‘balancing’ the budget is in many cases, incorrectly, considered by the municipality as an adequate measure of sustainability;

• Inadequate allocations to operational repairs and maintenance and capital asset renewal;• Underperformance, particularly in respect of capital programmes, has been attributed to

challenges associated with the implementation of the Supply Chain Management Regulations. However, the obvious lack of credible multi-year planning is a significant contributing factor;

• Municipalities are increasingly receiving audit qualifications because of unauthorised and irregular expenditure as a result of tenders being allocated to persons in the employ of the municipality and the state; and

• Several municipalities presented low levels of ‘cash coverage’ (less than a month).6

Measure

City of Johannesburg

City of Cape Town

eThekwini Metro

Ekurhuleni Metro

City of Tshwane

Nelson Mandela

Bay Metro

Mangaung Metro

Buffalo City Total and Average

Total Operating Revenue 33 359 495 23 880 441 23 601 685 22 425 776 20 689 100 7 281 273 4 753 713 3 926 868 Total Operating Expenditure 31 869 192 24 341 213 23 560 489 23 383 287 21 104 606 7 601 331 4 569 140 3 939 855 Operating Performance Surplus/(Deficit) 1 490 303 (460 772) 41 196 (957 511) (415 507) (320 058) 184 572 (12 987) Cash and Cash Equivalents (30 June 2013) 2 912 536 3 784 449 3 635 614 3 002 600 1 561 715 366 046 218 444 1 857 504 Net increase / (Decrease) in Cash held for the Year 1 786 394 (1 385 691) 174 405 809 524 342 012 (399 184) 158 473 421 247 Cash backing / Surplus (Deficit) Reconciliation 825 243 3 829 377 3 691 375 1 279 283 481 430 (196 876) (163 175) 1 288 347 Cost Coverage Ratio 1.3 2.2 2.3 1.8 1.0 0.8 0.8 7.7 STATEMENT OF OPERATING PERFORMANCERevenue

% Increase in Total Operating Revenue 10.8% 10.7% 8.1% 12.1% 13.3% 11.1% 23.1% 13.9% 12.9%% Increase in Property Rates Revenue 17.8% 9.1% 4.8% 8.7% 8.0% 11.8% 13.7% 11.3% 10.7%% Increase in Electricity Revenue 14.0% 8.5% 9.6% 13.0% 19.3% 11.4% 28.4% 9.6% 14.2%% Increase in Water Revenue 14.6% 13.7% 14.2% 16.4% 10.4% 13.3% 33.9% 14.2% 16.3%% Increase in Property Rates & Services Charges 14.7% 9.6% 8.8% 12.7% 14.9% 11.6% 32.4% 10.7% 14.4%% Increase in Operating Grant Revenue -6.8% 32.4% 3.7% 8.8% 10.8% 13.8% 11.9% 5.3% 10.0%% Increase in Capital Grant Revenue 20.8% 26.6% 29.5% 6.5% 39.1% 43.2% -13.9% 17.0% 21.1%% Collection Rate Including Other Revenue 97.0% 97.1% 99.2% 91.6% 92.6% 88.8% 81.9% 89.3% 92.2%

Expenditure% Increase in Total Operating Expenditure 6.1% 12.2% 7.8% 10.8% 14.7% 9.6% 21.8% 5.8% 11.1%

% Increase in Employee Costs 7.9% 9.7% 10.1% 11.4% 17.9% -0.3% 12.5% 6.3% 9.4%% Overtime measured against Employee Related Costs 3.3% 3.6% 4.7% 7.2% 2.4% 3.5% 4.4% 4.4% 4.2%% Increase in Electricity Bulk Purchases 15.5% 13.5% 12.4% 14.2% 25.0% 15.8% 17.0% 16.2% 16.2%% Increase in Water Bulk Purchases 13.5% 5.4% 18.2% 13.5% 13.9% 13.5% 23.3% 9.3% 13.8%% Remuneration measured against Operating Expenditure (excl debt impairment and depreciation) 27.1% 35.1% 28.4% 23.8% 29.8% 27.9% 24.0% 30.7% 28.3%% Contracted Services measured against Operating Expenditure (excl debt impairment and depreciation) 10.8% 11.7% 14.4% 3.8% 18.5% 6.4% 5.4% 0.3% 8.9%% Debt Impairment measured against Billable Revenue 7.8% 5.4% 2.2% 7.1% 5.5% 5.0% 5.5% 8.5% 5.9%% Electricity Distribution 12% 9% 5% 12% 10% 7% 18% 11% 10.5%% Water Losses 34.0% 18.0% 33.0% 19.0% 23.0% 24.3% 32.0% 48.8% 29.0%

Tabled 2012/13 Medium-term Revenue and Expenditure Framework - 2012/13 Financial Year

2012/13 Tabled MTREF – Nelson Mandela Bay MetroBenchmarking (1)

Measure

City of Johannesburg

City of Cape Town

eThekwini Metro

Ekurhuleni Metro

City of Tshwane

Nelson Mandela

Bay Metro

Mangaung Metro

Buffalo City

Total Operating Revenue 33 359 495 23 880 441 23 601 685 22 425 776 20 689 100 7 281 273 4 753 713 3 926 868 Total Operating Expenditure 31 869 192 24 341 213 23 560 489 23 383 287 21 104 606 7 601 331 4 569 140 3 939 855 INFRASTRUCTURE DEVELOPMENT & ASSET MANAGEMENTCapital Funding

Total Capital Budget (R'000) 4 199 666 5 325 027 5 252 215 2 572 708 4 203 741 1 803 661 769 667 734 265 Internally Funded & Other (R'000) 491 207 757 886 977 638 204 461 739 215 313 287 159 815 70 028 Grant Funding and Other (R'000) 2 508 459 2 871 821 2 774 577 1 412 402 1 964 526 1 490 374 503 967 664 237 % Internally Generated Funds measured against Total Non Grant Funding 29.0% 30.9% 39.5% 17.6% 33.0% 100.0% 60.1% 100.0%% Borrowing measured against Total Non Grant Funding 71.0% 69.1% 60.5% 82.4% 67.0% 0.0% 39.9% 0.0%% Grant Funding measured against Total Funding 60% 54% 53% 55% 47% 83% 65% 90%

Borrowing Total Borrowing Liability (R'000) 12 148 280 6 964 710 11 069 149 4 557 247 7 845 547 1 629 013 185 039 607 208 Borrowing for the Financial Year (R'000) 1 200 000 1 695 319 1 500 000 955 845 1 500 000 – 105 885 – Cost of Borrowing for the Financial Year (R'000) 3 072 104 900 447 2 073 890 772 281 1 072 230 300 580 79 164 130 645 % Total Cost of Debt measured against Total Borrowing Liability 25.3% 12.9% 18.7% 16.9% 13.7% 18.5% 42.8% 21.5%% Financing Cost measured against Total Asset Base 3.9% 2.7% 3.2% 1.3% 3.6% 1.5% 1.4% 0.7%% Capital Charges measured against Total Operating Expenditure 9.6% 3.7% 8.8% 3.3% 5.1% 4.0% 1.7% 3.3%%Total Borrowing measured against Total Assets 30.0% 24.7% 28.2% 9.8% 36.5% 12.2% 3.8% 5.1%

Tabled 2012/13 Medium-term Revenue and Expenditure Framework - 2012/13 Financial Year

2012/13 Tabled MTREF – Nelson Mandela Bay MetroBenchmarking (2)

Measure

City of Johannesburg

City of Cape Town

eThekwini Metro

Ekurhuleni Metro

City of Tshwane

Nelson Mandela

Bay Metro

Mangaung Metro

Buffalo City Total and Average

Total Operating Revenue 33 359 495 23 880 441 23 601 685 22 425 776 20 689 100 7 281 273 4 753 713 3 926 868 Total Operating Expenditure 31 869 192 24 341 213 23 560 489 23 383 287 21 104 606 7 601 331 4 569 140 3 939 855 Capital ProgrammeCapital Appropriations (R'000)Trading Services (R'000) 1 674 965 2 144 758 2 065 497 857 075 1 663 311 816 313 482 424 270 172

Total Appropriation - Electricity Infrastructure (R'000) 944 165 1 222 524 539 850 353 675 617 800 121 807 200 767 50 000 Total Appropriation - Water Infrastructure (R'000) 676 600 291 474 691 089 199 885 191 613 399 906 139 311 30 800 Total Appropriation - Waste Water Management (R'000) – 385 255 654 758 170 115 801 398 288 600 129 936 177 608 Total Appropriation - Waste Management (R'000) 54 200 245 506 179 800 133 400 52 500 6 000 12 410 11 764

Economic and Environmental (R'000) 1 612 961 1 836 863 1 809 405 737 853 1 387 803 752 000 184 345 305 157 Total Appropriation - Planning and Development (R'000) 347 096 33 199 356 552 61 798 10 200 46 000 55 187 180 157 Total Appropriation - Road Transport (R'000) 1 259 115 1 778 183 1 450 153 667 910 1 368 603 693 000 129 159 120 000 Total Appropriation - Environmental Protection (R'000) 6 750 25 481 2 700 8 145 9 000 13 000 – 5 000

Governance and Administration (R'000) 107 930 258 662 84 200 500 495 219 022 44 880 49 548 22 500 Community and Public Safety (R'000) 803 810 1 081 443 1 282 675 477 285 899 395 190 468 53 350 131 336 Other (R'000) – 3 300 10 438 – 34 210 – – 5 100 % Capital Appropriations measured against Total CapitalTrading Services 39.9% 40.3% 39.3% 33.3% 39.6% 45.3% 62.7% 36.8% 42.1%

% of Capital Budget - Electricity Infrastructure 22.5% 23.0% 10.3% 13.7% 14.7% 6.8% 26.1% 6.8% 15.5%% of Capital Budget - Water Infrastructure 16.1% 5.5% 13.2% 7.8% 4.6% 22.2% 18.1% 4.2% 11.4%% of Capital Budget - Waste Water Management 0.0% 7.2% 12.5% 6.6% 19.1% 16.0% 16.9% 24.2% 12.8%% of Capital Budget - Water Management 1.3% 4.6% 3.4% 5.2% 1.2% 0.3% 1.6% 1.6% 2.4%

Economic and Environmental 38.4% 34.5% 34.5% 28.7% 33.0% 41.7% 24.0% 41.6% 34.5%% of Capital Budget - Planning and Development 8.3% 0.6% 6.8% 2.4% 0.2% 2.6% 7.2% 24.5% 6.6%% of Capital Budget - Road Transport 30.0% 33.4% 27.6% 26.0% 32.6% 38.4% 16.8% 16.3% 27.6%% of Capital Budget - Environmental Protection 0.2% 0.5% 0.1% 0.3% 0.2% 0.7% 0.0% 0.7% 0.3%

Governance and Administration 2.6% 4.9% 1.6% 19.5% 5.2% 2.5% 6.4% 3.1% 5.7%Community and Public Safety 19.1% 20.3% 24.4% 18.6% 21.4% 10.6% 6.9% 17.9% 17.4%Other 0.0% 0.1% 0.2% 0.0% 0.8% 0.0% 0.0% 0.7% 0.2%

Tabled 2012/13 Medium-term Revenue and Expenditure Framework - 2012/13 Financial Year

2012/13 Tabled MTREF – Nelson Mandela Bay MetroBenchmarking (3)

Measure

City of Johannesburg

City of Cape Town

eThekwini Metro

Ekurhuleni Metro

City of Tshwane

Nelson Mandela

Bay Metro

Mangaung Metro

Buffalo City Total and Average

Total Operating Revenue 33 359 495 23 880 441 23 601 685 22 425 776 20 689 100 7 281 273 4 753 713 3 926 868 Total Operating Expenditure 31 869 192 24 341 213 23 560 489 23 383 287 21 104 606 7 601 331 4 569 140 3 939 855 Asset Management

Total Value of PPE (R'000) 40 478 968 28 235 143 39 193 546 46 712 243 21 498 574 13 359 753 4 823 757 12 017 278 Capital Asset Renewal (R'000) 970 795 2 002 416 1 846 784 1 048 890 2 247 651 1 182 409 186 205 73 800 Operational Repairs & Maintenance (R'000) 1 894 622 2 591 097 2 487 703 2 034 399 2 084 180 498 534 238 250 280 797 Asset Renewal % of Depreciation 53.9% 138.7% 99.9% 47.7% 216.2% 160.6% 82.3% 22.3% 102.7%R&M % of PPE 4.7% 9.2% 6.3% 4.4% 9.7% 3.7% 4.9% 2.3% 5.7%Asset Renewal and R&M as a % of PPE 7.1% 16.3% 11.1% 6.6% 20.1% 12.6% 8.8% 3.0% 10.7%Depreciation as % of Asset Base (PPE) 4.4% 5.1% 4.7% 4.7% 4.8% 5.5% 4.7% 2.8% 4.6%

AVERAGE HOUSEHOLD BILLSPercentage Increases

Property rates 6.0% 8.0% 0.8% 7.2% 12.0% 13.0% 167.1% 11.3% 28.2%Electricity: Basic levy 5.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.6%Electricity: Consumption 13.0% 9.9% 11.0% -13.5% 11.7% 11.0% 44.6% 11.0% 12.3%Water: Basic levy 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%Water: Consumption 11.0% 17.2% 66.1% 9.7% 10.0% 13.0% 22.7% 14.2% 20.5%Sanitation 14.5% 15.0% 6.5% 10.4% 12.0% 13.0% 107.4% 10.3% 23.6%Refuse removal 6.7% 7.1% 7.0% 15.0% 25.0% 13.0% 100.0% 12.3% 23.3%Other 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 10.3% 1.3%

Monthly BillProperty rates 162.56 151.55 289.43 215.83 330.06 176.73 298.84 82.34 213.42Electricity: Basic levy 322.39 0 0 0 0 0.00 0 0.00 40.30Electricity: Consumption 448.10 590.30 520.09 422.82 574.36 504.84 464.5 574.45 512.43Water: Basic levy 0 0 0 0 0 23.66 0 0.00 2.96Water: Consumption 201.34 205.44 265.02 193.88 232.24 186.46 257.82 248.37 223.82Sanitation 98.7 147.98 55.85 94.19 117.67 133.09 173.68 71.76 111.62Refuse removal 96.78 85.21 49.01 105.73 42.37 61.04 40 122.15 75.29Other 0 0 0 0 0 0.00 0 28.06 3.51Total Monthly Bill 1329.87 1180.48 1179.4 1032.45 1296.7 1085.83 1234.84 1127.14 1183.34

Tabled 2012/13 Medium-term Revenue and Expenditure Framework - 2012/13 Financial Year

2012/13 Tabled MTREF – Nelson Mandela Bay MetroBenchmarking (4)

?

Measure

City of Johannesburg

City of Cape Town

eThekwini Metro

Ekurhuleni Metro

City of Tshwane

Nelson Mandela

Bay Metro

Mangaung Metro

Buffalo City Total and Average

Total Operating Revenue 33 359 495 23 880 441 23 601 685 22 425 776 20 689 100 7 281 273 4 753 713 3 926 868 Total Operating Expenditure 31 869 192 24 341 213 23 560 489 23 383 287 21 104 606 7 601 331 4 569 140 3 939 855

Total Monthly Bill 1329.87 1180.48 1179.4 1032.45 1296.7 1085.83 1234.84 1127.14 1183.34SOCIAL PACKAGETotal Number of Households 1 337 919 1 142 000 1 001 000 1 036 999 853 100 424 522 No Data 249 Highest level of free service provided

Water (kilolitres per household per month) 6 6 9 9 12 8 No Data 6Electricity (kwh per household per month) 100 50 65 100 100 75 No Data 50

Number of Households receiving Free Basic ServicesWater (6 kilolitres per household per month) 1 314 697 1 130 000 518 000 436 255 110 000 74 867 No Data 50 000Sanitation (free minimum level service) 1 375 486 1 081 000 494 000 436 255 110 000 74 867 No Data 50 000Electricity/other energy (50kwh per household per month) 242 551 374 892 65 100 0 110 000 67 158 No Data 63 000Refuse (removed at least once a week) 364 130 494 000 696 000 189 281 110 000 68 485 No Data 50 000

Cost of Free Basic Services provided (R'000) 261 069 1 462 195 1 130 808 815 019 284 932 231 118 No Data 174 475 Water (6 kilolitres per household per month) 40 703 544 359 522 000 304 254 90 078 50 703 No Data 26 756 Sanitation (free sanitation service) 28 708 384 410 250 000 235 306 17 316 88 171 No Data 43 057 Electricity/other energy (50kwh per household per month) 101 658 247 297 64 643 60 000 115 721 32 067 No Data 31 372 Refuse (removed once a week) 90 000 286 130 294 165 215 460 61 817 60 177 No Data 73 289

Average Cost per Household per Annum 718.12 2 076.20 2 929.43 2 375.11 2 590.29 3 211.11 No Data 3 360.02 2 465.75Water (6 kilolitres per household per month) 30.96 481.73 1 007.72 697.42 818.89 677.24 No Data 535.13 607.01Sanitation (free sanitation service) 20.87 355.61 506.07 539.38 157.42 1 177.70 No Data 861.13 516.88Electricity/other energy (50kwh per household per month) 419.12 659.65 992.98 0.00 1 052.01 477.48 No Data 497.97 585.60Refuse (removed once a week) 247.16 579.21 422.65 1 138.31 561.97 878.69 No Data 1 465.78 756.25

Cost of Free Basic Services Provided to "Registered Indigent" (R'000) 186 126 778 350 952 063 449 562 284 932 215 652 No Data 211 681 Revenue cost of free services provided (excl property rates and other) (R'000) 3 851 512 1 118 911 1 129 596 671 559 332 878 264 052 No Data 174 475 Local Government Equitable Share (R'000) 2 125 543 1 099 575 1 698 832 1 825 341 1 040 630 719 226 603 089 651 565 2012/13 of MTREF Funded/Unfunded as informed by A8 Funded Funded Funded Funded Funded Not Funded Not Funded Funded

Tabled 2012/13 Medium-term Revenue and Expenditure Framework - 2012/13 Financial Year

2012/13 Tabled MTREF – Nelson Mandela Bay MetroBenchmarking (5)

AS PER MUNICIPAL MBRR

NT CALCULATION

AS PER MUNICIPAL MBRR

AS PER MUNICIPAL MBRR

AS PER MUNICIPAL MBRR

NT CALCULATION

? ? ?? ?? ? ?

Analysis of Electricity Gross and Net Margins NMBM Metropolitan Municipality

12

Analysis of Water Gross and Net Margins NMBM Metropolitan Municipality

13

Net Operating MarginMetro Comparison - Electricity

14

-20.0%

-15.0%

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

2008/9 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15

Net Operating Margin (Electricity) - Metros

City of Johannesburg

City of Cape Town

eThekwini Metro

Ekurhuleni Metro

City of Tshwane

Nelson Mandela Bay Metro

Mangaung Metro

Buffalo City

Net Operating MarginMetro Comparison – Water

15

-120.0%

-100.0%

-80.0%

-60.0%

-40.0%

-20.0%

0.0%

20.0%

40.0%

2008/9 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15

Net Operating Margin (Water) - Metros

City of Johannesburg

City of Cape Town

eThekwini Metro

Ekurhuleni Metro

City of Tshwane

Nelson Mandela Bay Metro

Mangaung Metro

Buffalo City

Analysis of the Electricity Trading Service

16

Analysis of the Water Trading Service

17

Analysis of the Waste Water Trading Service - NMBM

18

Analysis of the Waste Management Trading Service - NMBM

19

Analysis of the All Trading Services - NMBM

20

THANK YOU