EThekwini municipality clarifies national treasury notice on conditional grants
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Date: 2025-02-25 15:11:05

EThekwini municipality clarifies national treasury notice on conditional grants

MEDIA STATEMENT
25 FEBRUARY 2025
FOR IMMEDIATE RELEASE
 
ETHEKWINI MUNICIPALITY CLARIFIES NATIONAL TREASURY NOTICE ON CONDITIONAL GRANTS
 
EThekwini Municipality prides itself as the only metro in the country to have achieved 100 percent expenditure in the Urban Settlements Development Grant (USDG) and the Informal Settlement Upgrading Partnership Grant (ISUPG) for five consecutive years.
 
Furthermore, the City reassures residents, business, stakeholders, and partners that the recent notice by National Treasury regarding the intention to stop the transfer of certain funds is part of a routine process.
 
The municipality has submitted written responses to National Treasury to address some of the matters that have been highlighted in an internal and confidential letter addressed to the City Manager Musa Mbhele. 
 
The correspondence from National Treasury will not in any way affect future allocations to the municipality.
 
On a yearly basis, National Treasury reviews its allocation to municipalities based on 40% performance mid-year. 
 
However, the City is at 41% as at mid-year, so the proposed budget cuts from National Treasury does not apply to eThekwini. Pertaining to the Public Employment Programme (PEP), which is part of Neighbourhood Development Partnership Grant (NDPG), the City has committed to fast track the acceleration of expenditure and National Treasury has supported it.
 
EThekwini Municipality Spokesperson Gugu Sisilana explained: "Importantly, we can confirm that this notice may apply to the Public Transport Network Grant (PTNG) and should not impact other grants mentioned. There is adequate information to demonstrate compliance with the Division of Revenue Act (DoRA) conditions and to justify the retention of the other grants.”  
 
The Municipality acknowledges National Treasury’s concerns as outlined in the 2024/25 mid-year expenditure report, submitted in terms of the Division of Revenue Act (Act No. 24 of 2024), as amended, and the Municipal Finance Management Act (Act No. 56 of 2003). The identified challenges relate mainly to the current impasse with the transferring officer responsible for the Public Transport Network Grant, which has affected grant compliance and performance reporting in respect of the Go!Durban project.
 
"We remain fully committed to resolving these issues in close collaboration with National Treasury and the transferring officer to ensure compliance with all relevant legislative requirements. To this effect, the City leadership is engaging the Ministry of Transport regarding the Public Transport Network Grant and related projects such as Go! Durban,” said Sisilana.
 
Steps are already underway to address the concerns and realign project implementation plans to achieve the desired outcomes for our public transport network and the Go!Durban project.
 
"We want to reassure residents that this matter will not disrupt our ongoing service delivery efforts and remain committed to delivering on our development objectives, including improved public transport infrastructure and services, and ensuring that all allocated resources benefit the community." 
 
The City thanks National Treasury for its continued guidance and oversight.
 
ENDS
 
Issued by eThekwini Municipality’s Communications Unit.