How exactly a municipal budget is created
A RESIDENT recently asked me to briefly explain the municipal budgeting process.
The Municipal Finance Management Act (MFMA) governs the process by which a municipal budget is created, while the national treasury also issues strict guidelines on how municipal councils should process their annual budgets.
A municipal council must adopt its budget before June 30 each year as the municipal budget year ordinarily starts on July 1.
The annual budget of a municipality is always in a prescribed format which sets out realistically-anticipated revenue for the budget year from various revenue sources. It also appropriates spending for the budget year to the different votes of the municipality. A municipal budget is also generally divided between a capital and an operating budget, and must speak to that municipality's integrated development plan.
In terms of the MFMA a municipal council must table the annual municipal budget at a council meeting at least 90 days before the start of the budget year (normally before the end of March).
When the budget has been tabled the municipal council must consider any views of the local community as well as those from national treasury.
After considering all budget submissions, the council must give the mayor an opportunity to respond to submissions and, if necessary, the opportunity to revise the budget.
Public participation also forms an integral part of the municipal budgeting process. In Nelson Mandela Bay there are normally several rounds of public meetings so residents can get insight and give their input. Should you be unable to attend such a meeting you can always give input through your local councillor office.
A municipality may revise an approved budget through an adjustments budget. These may only be tabled to council by the mayor and it is normally done in February each year.
If a municipality fails to approve an annual budget by the start of a budget year, the provincial executive of the relevant province must intervene by taking appropriate steps to ensure the budget is approved.
Such action might include the dissolution of that specific council.