SUMMARY OF THE DRAFT REVENUE ENHANCEMENT STRATEGY Tabled

SUMMARY OF THE DRAFT REVENUE ENHANCEMENT STRATEGY Tabled before Council on 28 April 2017

Introduction • The draft revenue enhancement strategy has been developed as a result of the prevailing undesirable financial situation being encountered by the municipality. • During the tabling of the 2016/2017 adjustments budget on 28 February 2017 and subsequent tabling of 2017/2018 draft budget to Council on 31 March 2017 it was mentioned by the Executive Mayor that the improvement of the state of the municipal finances can be achieved through the implementation of a revenue enhancement strategy. • The revenue enhancement strategy has been crafted to address revenue generation, collection and protection potential risks and challenges that impact on the financial governance and sustainability of the municipality. • The draft revenue strategy also seeks to address ineffectiveness, inefficiency and uneconomical utilisation of the financial and operational resources as well as improving services delivery to the households of the municipality. 2

Key Features of the Revenue Enhancement Strategy The strategy has been formulated and consists of the details regarding the following: (a) The functional areas; (b) The problem statements or challenges encountered in those functional areas relating to revenue management or operational challenges; (c) The extent of the problem or revenue loss; (d) The strategies to be implemented to address or mitigate the problem or potential revenue loss risks; 3

Key Features of the Revenue Enhancement Strategy The strategy has been formulated and consists of the details regarding the following: (e) The activities or actions to be implemented; (f) The impact on revenue as a result of the implementation of the strategies; (g) The indication of the financial implications; (h) The timeframes for the completion of the implementation of the strategies; (i) And lastly, the General Managers or Head of Department responsible for the implementation of the strategies. 4

Key strategies proposed to mitigated the challenges and / or potential risks 1. The implementation of the smart metering technology on electricity meters on large and medium customers. 2. The phasing out of the electricity credit or conventional meters with prepayment meters on small domestic customers. 3. The piloting of the prepayment water meters. 4. Improvement on the collection of traffic fines. 5. Inclusion of the government owned properties situated in the rural and peri-urban areas on the valuation roll. 5

Key strategies proposed to mitigated the challenges and / or potential risks 6. The linking of the Geographical Information System with the Billing and Debtors System. 7. The implementation of the meter management programme which includes, meter audits, and repair and replacement projects. 8. The implementation of the payment incentives, credit control and debt collection mechanisms. 9. The compilation of a new general valuation roll to be implemented on 01 July 2018. 10. The development of new by-laws and enforcement thereof, such as Electricity, Water and Sanitation, Waste Management, Outdoor Advertising, Credit Control and Debt Collection, Property Rates By-Laws etc. 11. The service delivery functions value chain analysis costing model and review of the tariffs structures. 6

Conclusion • The Draft Revenue Enhancement Strategy is still a work in progress as further inputs and comments have been from all relevant stakeholders which include amongst others: i. National Treasury ii. Provincial Treasury iii. SALGA • The Draft Revenue Enhancement Strategy will be published on the website. • All comments must be forwarded to the municipality by 12 May 2017 as indicated. • The final Revenue Enhancement Strategy will be tabled before Council for approval on / before 31 May 2017. 7

CITY OF MBOMBELA