Municipalities’ spending on staff surges to R73bn

Municipalities' employee-related costs grew by 43.9% between 2011 and 2015‚ or from R50-billion in 2011 to R73-billion in 2015. This was revealed in the Statistics SA financial census of municipalities in Pretoria on Wednesday. Employee-related costs contributed to just over a quarter of municipalities’ total operating expenditure in the financial year ended in June 2015‚ according to Statistics SA. Finance Minister Pravin Gordhan‚ in his budget speech in February‚ announced a raft of measures to contain a bloated public service wage bill that has long been flagged by Treasury as a risk to the fiscus. Statistician-General Pali Lehohla told reporters in Pretoria on Wednesday that all 278 municipalities combined in South Africa increased their operating expenditure from R264bn in the 2014 fiscal year to R285bn in 2015‚ of which employment related costs contributed 25.6%. He said municipalities in Gauteng had the highest rate of employee-related costs‚ at R23.5bn in 2015‚ while the councils in the Northern Cape spent R1.8bn on employee-related costs. Stats SA director for local government institutions Malibongwe Mhemhe said: “The number of employees has increased and the salaries have increased.” Meanwhile‚ all municipalities’ combined liabilities rose from R177bn in 2014 to R197bn in 2015. The steepest climb in this regard again came from Gauteng’s municipalities‚ where liabilities rose from R68.3bn to R80bn. Municipalities had a total capital expenditure of R59.2bn‚ of which 54% was in Gauteng municipalities. - TMG Digital/BDlive