FINANCES: Cape Town City's Finances Look Good
Recent Western Cape Business News
The City of Cape Town’s Annual Report for the 2009/2010 financial year is a clear indicator of its strategy to promote infrastructure-led economic growth in Cape Town. This type of development is crucial for the City to realise its full potential and generate financial, economic, and employment benefits for all residents.
“This year City Directorates remained as focused and committed as ever to working together to deliver services and infrastructure to Cape Town and its people, despite the added workload and significant budgetary constraints resulting from the preparations to host one of the largest sporting events in the world – the 2010 World Cup,” said the City Manager, Achmat Ebrahim.
The responses to the City’s regular community satisfaction surveys of 3 000 residents and 701 businesses show that overall perceptions of performance have improved significantly over the past three years. This perception is borne out by the results in the Annual Report – a document which provides residents and stakeholders with feedback on the City’s achievements against the objectives set out in the 2009/10 Integrated Development Plan.
The latest Annual Report shows that the City is on firm financial ground, with its seventh consecutive unqualified audit from the Auditor General and the receipt of the highest rating of all metropolitan municipalities analysed by independent credit ratings agency, Moody’s.
For the fifth consecutive year, the City managed to maintain its positive long-term credit rating of Aa2.za with a stable outlook from Moody’s. This prized rating provides investors and residents with confidence in the financial leadership and management of the municipality. Moody’s also gave the City a short-term issuer rating of Prime-1.za. This means that investors are of the opinion that the City has the ability to honour unsecured financial contracts and obligations.
The City collected 95.17% of billing as revenue during the financial year. On the other side of the spectrum, the City handled its budget well, spending 109.07% of the training budget, 83% of the capital budget and 97.4% of the operating budget.
“The strategy of infrastructure-led economic growth was demonstrated by many legacy projects throughout the city. The most significant of these was the 2010 World Cup which ran from 11 June to 11 July 2010. The highlight of the tournament was the sense of ‘gees’ and unity among all Capetonians, especially the ‘vibe’ created by the thousands of fans who opted to use the City’s fan walk as a route to the Cape Town Stadium for matches. The tournament was a great success, but the real value of the event is still being unlocked and will continue to reflect for decades to come,” said the City’s Executive Mayor, Alderman Dan Plato.
The preparation as Host City saw a R12.4 billion investment in infrastructure improvements across Cape Town. This includes:
· Cape Town Stadium – R4.4 billion
· Roads and bridges in the CBD – R298 million
· Green Point Urban Park – R576 million
· Inner-city transport in the form of MyCiTi infrastructure – R42 million
· Infrastructure development in the CBD – R590 million
· Local roads and sports complexes – R513 million
· Upgrades to major roads in the CBD – R1.8 billion
· General public transport infrastructure – R4.2 billion
Another infrastructural benefit came with the implementation of portions of Phase 1A of the MyCiTi/IRT system in time for the 2010 World Cup.
Two services were launched during the financial year, namely the Airport Shuttle (link between the Cape Town International Airport and the Civic Centre) and the interim inner-city service (a loop running through the inner city for the duration of the 2010 World Cup).
The implementation of the service saw multiple road and intersection upgrades and provided transport support services which were crucial to the successful hosting of the tournament. The MyCiTi/IRT service will continue to be rolled out over the next two decades, and will serve to reduce congestion and cut overall carbon emissions.
As part of the rollout, the City launched the state-of-the-art Transport Management Centre (TMC). The TMC is the first integrated public transport, traffic and safety and security management centre in the country, and one of the first of its kind in the world. Transport operations throughout the tournament were managed from this hi-tech central hub.
Other developments on the transport front include the opening of two new vehicle registration and licensing offices (in Milnerton and Parow) and the installation of Variable Message Signage boards on major highways to provide motorists with regular traffic updates.
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