City of Cape Town
Annual Report Executive Summary 2009/10
Contents
FOREWORD BY THE EXECUTIVE MAYOR
1
INTRODUCTION BY THE CITY MANAGER
1
OVERVIEW OF THE CITY OF CAPE TOWN
2
REVIEW OF The 2010 fifa world cup™
3
REVIEW OF THE 2009/10 FINANCIAL YEAR
4
Growing our economy and creating jobs
4
Committed to service delivery
4
Creating a sustainable future for all Capetonians
5
Driven to provide an effective transport system
5
Increasing housing provision and upgrading community
facilities
6
Keeping our city safe and secure
6
Healthy and happy people and communities
7
A well-governed city
7
Summarised report by the Chief Financial Officer
8
1
Foreword
by the Executive Mayor
Introduction
by the City Manager
Much work has been done by the City over the past year
The 2009/10 financial year was undoubtedly one of the
– often in the face of massive challenges – to continue
most exciting and challenging periods in the history of
moving Cape Town forward towards the vision we all
our wonderful city. The 2010 FIFA World Cup™ can only
share for it. At the heart of our strategy for achieving this
be said to have been an exceptional success and the
vision lies a commitment to enabling and promoting the
legacy left by the event will undoubtedly deliver benefits
infrastructure-led economic growth of the city. This is the
for many years to come.
golden thread that runs through everything we do at the
City of Cape Town. Every plan, strategy and action has the
ultimate purpose of making our city a great place to live,
work, visit and invest. Because when we are able to do that,
everyone benefits.
As a host city for the 2010 FIFA World Cup™, Cape Town
was afforded a truly unique opportunity not just to promote
itself to the rest of the world, but also to invest in the
city’s future. My heartfelt congratulations to every person,
organisation, business and community that played a part
in making Cape Town’s hosting of the 2010 FIFA World
Cup™ the tremendous success it was. I believe it served
But City directorates also 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 primary focus of the City of Cape Town remains
the development and promotion of the infrastructureled economic growth that the city needs to realise its
full potential, and generate financial, economic and
employment benefits for its entire people.
as an excellent reminder to us all of the magnificence of
the city in which we are privileged to live and work. And
as the government institution tasked with managing and
developing this great city, and serving its people, the City of
Cape Town is now more committed than ever to help take
our city to even greater heights, for the benefit of all.
Alderman Dan Plato
Achmat Ebrahim
Executive Mayor
City Manager
Overview of the City of Cape Town
Cape Town: A city with vision
As the organisation with the primary responsibility for
ensuring that Cape Town is able to realise its full potential
in every respect, the vision of the City of Cape Town (the
City) is:
•To ensure that Cape Town is a prosperous city, in which
City government creates an enabling environment for
shared growth and economic development
•To achieve effective, efficient and equitable service
delivery, and
•To serve the citizens of Cape Town as a well-governed
and efficiently run administration.
Achieving our vision
through an integrated approach
In working to achieve its vision for Cape Town, the City
focuses its efforts on a number of key Strategic Focus Areas
(SFAs), all of which are aimed at ensuring that Capetonians
enjoy the best possible services, facilities and opportunities,
delivered in a way that improves their quality of life.
Each of these focus areas is broken down into objectives
and deliverables, for which various directorates within the
City are responsible. This annual report is an opportunity
for the City to provide residents of Cape Town, and all
other stakeholders, with feedback on the achievements
against the objectives set out in the 2009/10 Integrated
Development Plan (IDP).
City of Cape Town Annual Report Executive Summary 2009/10
While this report is, of necessity, structured according to
2
the eight SFAs, the City follows an holistic approach to
achieving these objectives. The work done by the various
departments and directorates is therefore highly integrated
and guided by a shared and common vision for Cape Town
and its residents.
3
The 2010 FIFA World Cup™
Review of the 2010 FIFA World Cup™
While Cape Town’s hosting of the 2010 FIFA World Cup™
was an unparalleled success, the real value of the event is
still being unlocked for the city – and will continue to be for
decades to come.
The City set itself the following objectives when preparing
to host the 2010 FIFA World Cup™:
•Host a successful event.
•Create long-term public benefit for all Capetonians,
primarily through investment in infrastructure and
public transport.
•Position Cape Town for long-term economic growth.
Thanks, primarily, to the close working partnerships among
all stakeholders, the first objective was met. Achievements
in terms of the second and third objectives are difficult to
quantify so soon after the event, however, the extensive
accelerated development of new infrastructure, the capital
investment in the city’s main access roads, and improvements
in the Central Business District (CBD) and public transport
infrastructure will offer benefits to all Capetonians and will
help to position the city to bring about long-term economic
growth in the years ahead.
At a total co-funded capital cost of R12,4 billion, investment
in infrastructure creation and development was extensive,
contributing to the immense legacy that the 2010 FIFA
World Cup™ would leave for the city and its people.
A successful event becomes a long-term legacy
Review of the 2009/10 Financial Year
COMMITTED TO SERVICE DELIVERY
•100% of formal households with access to water and
basic sanitation
•26,8% reduction in unconstrained water demand
•R1,56 billion invested on repairs and maintenance
•Blue Drop award for drinking water quality
•Eight Green Drop certificates for wastewater treatment
plants
By the end of the 2009/10 financial year, 92,18% of
households across the metro and 72,87% of households
in informal settlements enjoyed access to basic levels of
electricity. This does not include the services provided by
Eskom. The City has also exceeded the planned number
of subsidised connections in informal areas and provided
subsidised connections for all formal applications received
in the financial year.
A groundbreaking project aimed at installing 24 000 km of optic fibre
GROWING OUR ECONOMY
AND CREATING JOBS
• 8 246 direct permanent job opportunities created
• 12 236 temporary job opportunities created
• R1,716 billion direct new investment secured
City of Cape Town Annual Report Executive Summary 2009/10
Despite the continued international fallout of the global
economic crisis, the City managed to create 8 246 direct
permanent job opportunities and attract over R1,7 billion in
direct investment in 2009/10.
4
For most of the year under review (excluding the World
Cup period), the decrease in international travel due to the
global recession resulted in fewer international visitors to
Cape Town, with only a 1% overall rise over 2009.
The City is committed to contributing to the transformation
of South Africa. Part of this commitment involves supporting
small, medium and micro enterprises (SMMEs) and blackowned companies. During the 2009/10 financial year, the
City purchased 57,96% (by rand value) of the products
and services it needed from SMMEs and black economically
empowered (BEE) businesses.
R516 million was spent on upgrading the city’s electricity
network, including improvements to substations, with
another R623 million earmarked for continued maintenance
in the coming year.
During the year under review, the City again focused on
meeting the water needs of its steadily growing population,
providing an average of one tap for every 12,56 households –
well above the national standard of one tap per 25 households.
Unconstrained demand for water was reduced by 26,8%,
marginally below the 27% target, while the total growth
in water demand was limited to just 1,65% – the lowest
since 2005. Water losses, as a percentage of total water
consumed, were also reduced by 25,4%.
All formal and 77% of informal households in Cape Town
now have access to basic levels of sanitation based on the
uniform servicing ratio in informal settlements and formal
area sanitation reticulation. A further 6 656 toilets were
installed in informal settlements during the year under
review, which means that the City has caught up on its
historic backlog in this area. R786 million was invested in
upgrades to water and sanitation infrastructure.
As part of the City’s commitment to encourage and
enable ongoing development, many of the development
Of all known households in Cape Town, 99% receive basic
levels of solid waste removal – from weekly door-to-door
collections to bagged refuse removals. The City managed to
save 19,77% of the available airspace on its landfill sites – a
good improvement on the 15,94% achieved in the previous
year, and proof that the Integrated Waste Management
application processes have been revised and streamlined.
Bylaw is having a positive impact.
5
DRIVEN TO PROVIDE AN EFFECTIVE
TRANSPORT SYSTEM
•Initial services of Integrated Rapid Transport (IRT)
system implemented
•Centralised
Transport
Management
Centre
established
•Road and intersection upgrades completed in time
for the 2010 FIFA World Cup™
The City opened its R160 million state-of-the-art
Transport Management Centre (TMC) in the period
Cape Point, one of Cape Town’s many tourist attractions
under review. The TMC is the first integrated public
transport, traffic and safety-and-security management
CREATING A SUSTAINABLE FUTURE
FOR ALL CAPETONIANS
centre in South Africa, and also one of the first of its
•6,7% reduction in energy consumption in Cape
As part of its drive to deliver better service in terms of
metropole
•2 333 households retrofitted with energy efficient
devices
As part of its fight against climate change, the City is
implementing a detailed programme that links climate
kind in the world.
vehicle registration and licensing, the City opened two
new motor vehicle registration and licensing offices
in Milnerton and Parow in 2010. The Milnerton office
effectively splits the motor vehicle registration and
licensing function from traffic-related transactions, and
change issues to the City’s ongoing development strategy.
will reduce congestion and waiting times.
More than 100 projects across 51 programme areas are
May 2010 saw the launch of Cape Town’s IRT service. The
aimed at making Cape Town a lower carbon, modern and
MyCiTi fleet of buses lies at the core of the IRT system,
sustainable city that can capitalise on its many competitive
supported by dedicated bus lanes and enhanced rail
advantages.
services. The IRT will continue to be rolled out over the
One of the key objectives of the City’s Climate Adaptation
next two decades, and will serve to reduce congestion
Plan of Action (CAPA) is to reduce electricity consumption in
and cut overall carbon emissions.
Cape Town by 10%. This is supported by the mass roll-out
of solar water heaters to Cape Town residents. It is hoped
that through this project more than 300 000 solar geyser
units will have been bought and installed in Cape Town
homes by 2014. As part of this commitment, Africa’s first
Clean Development Mechanism (CDM) project – the energy
efficient and solar water heater retrofitting of low-cost
housing in Kuyasa – was completed during the 2009/10
financial year.
The City is also working to reduce its own resource use
through the planned energy efficient retrofitting of four
City-owned administrative buildings.
As of June 2010, 40 000 out of a total of 300 000 public
streetlights have been fitted with energy-efficient highpressure sodium lamps. A third of Cape Town’s traffic lights
(400 out of 1 200 intersections) have also been retrofitted
with energy-saving light-emitting diodes (LEDs).
The bus rapid transit forms the main component of the IRT system
that aims to make public transport in Cape Town easier to use
Review of the 2009/10 Financial Year
INCREASING HOUSING PROVISION AND
UPGRADING COMMUNITY FACILITIES
•8 950 housing opportunities provided
•Reduced accident rate at high-frequency accident
locations by 14%
•1 041 erven upgraded through the informal settlements
•26% increase in arrests for drug-related crimes
upgrade programme
The City delivered 8 950 housing opportunities for
households and individuals from poorer communities, and
acquired more land to provide for Cape Town’s longer-term
development needs.
320 rental units were completed, and the City also
embarked on a major maintenance upgrade programme to
refurbish its many rental units.
7 700 units have been targeted for improvement, at a cost
of R1 billion, over the next five years.
A number of initiatives have been undertaken to increase
the City’s land holdings for development purposes. 165 ha
of land was bought at a cost of R63,7 million, and another
eight pockets of under-utilised public space were reserved
for housing purposes.
During the year under review, 90 affordable housing (GAP)
units were built, while around 100 serviced plots were
sold at discounted prices to owner-builders who could not
access bonds.
February 2010 saw the beginning of a strategic intervention
aimed at improving the living conditions of the many
thousands of so-called ‘backyard dwellers’ living in the
yards of the City’s rental properties.
The City also introduced an Informal Settlements Management
Plan to improve service delivery to the 140 000 households in
City of Cape Town Annual Report Executive Summary 2009/10
Cape Town’s more than 200 informal settlements.
6
KEEPING OUR CITY SAFE AND SECURE
Uniform quality and maintenance standards have been
•Successful implementation of City Disaster Management
Plan for 2010 FIFA World Cup™
•100% success rate in the combating of illegal land
invasions
A key focus of the City’s Law Enforcement Plan is to combat
anti-social behaviour, such as public drunkenness and drinking,
excessive noise and disturbances, and other offences. During
the year under review, 79 453 citations were issued for bylaw
offences across the city while 4 899 cases of illegal land invasion
were also successfully resolved. Two major intelligence-driven
operations, Razor and Choke, took place during the year, and
saw 955 arrests made for drug-related crimes.
The City’s Traffic Services Department, in co-operation with
a number of other role players, has managed to reduce the
accident rate at identified high-frequency accident locations
and undertook a number of operations aimed at curbing
drunk driving.
The City’s 107 emergency call centre capacity was enhanced
to ensure the highest levels of service and response to people
in life- and property-threatening situations. The number of
medical- and trauma-related calls received continued to
rise during the year under review, while fire-related calls
decreased in line with the trend established over the past
four years. City Emergency Services attended to around
3 700 incidents per month, of which 1 250 were fires.
The Disaster Risk Management Centre launched a Protect
Yourself Against Floods and Fires disaster risk reduction
campaign in 20 high-risk informal settlements as a
preparedness measure for winter flooding.
agreed for all City facilities and, during the year under
review, 78% of the City’s libraries, community parks, halls
and sports field facilities met these standards.
The City aims to ensure efficient law enforcement services
7
HEALTHY AND HAPPY PEOPLE
AND COMMUNITIES
•Air Quality Bylaw adopted
•Slowed the rate of increase in tuberculosis (TB)
•Reduced prevalence of antenatal HIV
•Opened third substance abuse treatment centre
•Placed 402 street people in rehabilitation and
reintegration programmes
During the year under review, air pollution in Cape Town
exceeded WHO guidelines on 111 days – a significant
improvement on the 165 days of the previous year. The
City’s new Air Quality Bylaw was adopted by Council on
31 March 2010.
The city’s infant mortality rate rose slightly to 20,76 out
of every 1 000 births, which still compares very favourably
with the national rate of more than 60 out of every 1 000.
The rate of increase in TB per 100 000 residents continued
to slow, reaching a figure of 821, which surpassed the
target of 1 040 for the year.
Against a target of 19,3%, the City achieved a reduction in
the prevalence of antenatal HIV to 14,1%.
The outpatient substance abuse treatment centres at
Tafelsig and Table View clinics continue to do excellent work
and, in October 2009, a third centre was opened at Delft
South Clinic.
During the year, the City’s libraries and sports and recreation
facilities played host to numerous children’s development
programmes. Special programmes were also held to cater
for children during the longer-than-usual school holiday
period due to the 2010 FIFA World Cup™. The City entered
into, or built on, eight significant sporting partnerships, and
hosted 17 major sporting events.
Communication with residents and communities is vital
A WELL-GOVERNED CITY
•7th consecutive unqualified audit from AuditorGeneral
•Spent 83% of capital budget and 97,4% of operating
budget
•Maintained positive credit ratings
•Further improved responses in annual community
satisfaction survey
The City once again put its available operating and
capital budgets to good use in delivering and maintaining
infrastructure, delivering services and utilities, and
working towards achieving its long-term vision.
For the seventh year in a row, an unqualified audit was
received from the Auditor-General and, for the fifth
consecutive year, the City maintained its credit rating
of Aa2.za (long-term) and Prime-1 (short-term) from
Moody’s Investor Services.
To promote good governance even further, Internal
Audit facilitated Council’s adoption of the King Code of
Governance for South Africa 2009 and the King Report
on Governance for South Africa 2009 (King III).
The City once again undertook its annual community
satisfaction survey of 3 000 residents and 701 businesses.
The results of the survey show that overall perceptions
of the City’s performance have increased significantly
over the past three years, with a steady increase in the
number of respondents who generally perceive services
to have improved across most service delivery areas.
Cape Town has the highest number of accredited clinics in the country
Review of the 2009/10 Financial Year
SUMMARISED REPORT BY THE CHIEF FINANCIAL OFFICER
Note: For more information on the 2009/10 City of Cape Town Financial Statements – see 2009/10 Annual Report or visit
www.capetown.gov.za.
Operating results
The overall summarised operating results for the City for the 2009/10 financial year (in comparison to the approved budget)
are shown below. The Statement of Financial Performance reflects a summary of income and expenditure, while the segmental
operating results per service are shown in Appendix D to the annual financial statements.
2010
2009
2009 to 2010
Actual
R’000
Budget
R’000
Actual
R’000
Growth
%
Property rates
3 837 920
3 813 865
3 237 649
18,54
Service charges
8 866 059
8 916 407
7 058 067
25,62
Grants and subsidies – operating
2 550 811
2 634 173
2 273 951
12,18
Finance income
516 415
505 386
666 643
(22,53)
Other
888 985
877 109
966 265
(8,00)
16 660 190
16 746 940
14 202 575
17,30
5 619 692
5 672 269
4 565 158
23,10
690 956
829 161
903 813
(23,55)
Revenue
Expenditure
Employee-related costs
Impairment costs
Net depreciation and amortisation expenses
610 074
576 849
390 953
56,05
Finance costs
601 733
540 448
407 966
47,50
3 667 765
3 705 691
2 878 228
27,43
839 677
774 973
696 704
20,52
Contract services
1 126 102
1 116 808
926 972
21,48
General expenses
3 000 042
3 383 634
2 863 686
4,76
16 156 041
16 599 833
13 633 480
18,50
504 149
147 107
569 095
2 024 806
2 021 161
2 970 310
(401 673)
(402 692)
(361 654)
Surplus
2 127 282
1 765 576
3 177 751
Appropriations and taxation
(1 718 876)
(1 206 049)
(3 311 050)
408 406
559 527
(133 299)
Bulk purchases
Repairs and maintenance
Net operating surplus before taxation and minority
interest
City of Cape Town Annual Report Executive Summary 2009/10
Grant and subsidies – capital
8
Grant-funded assets financed from reserve*
Net result
Actual revenue has increased by 17,30%, while expenditure increased 18,50% between the respective financial years. A
comparison of actual results to the approved budget, and explanations of material differences, is set out in the annual financial
statements (Appendix C).
* The grant-funded assets component included in the accumulated surplus represents deferred income to net of future
depreciation charges over the useful life of the assets funded as such.
Included in the Statement of Changes in Net Assets is a contribution to the capital replacement reserve of R948,47 million to
support the capital renewal programme.
9
Capital expenditure and financing
Capital expenditure incurred during the year amounted to R4,68 billion, which represents 83,12% (2009: 96,97%) of
the approved capital budget. The percentage does not include a disputed amount of R130 million included in the budget
comparative (refer note 49.2 – Annual Financial Statements.)
Capital expenditure per service
2010
2009
Actual
R’000
Budget
R’000
Variance
%
Actual
R’000
Rates and general
1 332 007
1 747 739
(23,79)
2 738 752
Roads and stormwater
1 588 087
1 856 251
(14,45)
759 847
Housing
228 579
345 888
(33,92)
226 936
Electricity
666 633
711 787
(6,34)
496 871
Water service (water and wastewater management)
576 767
648 855
(11,11)
699 558
Waste management (solid waste)
285 406
317 025
(9,97)
164 889
4 677 479
5 627 545
(16,88)
5 086 853
The aforementioned fixed assets were financed from the following sources:
Source of finance
2010
2009
Actual
R’000
Budget
R’000
Variance
%
Actual
R’000
838 276
925 475
(9,42)
451 830
External finance fund
1 782 933
2 252 945
(20,86)
1 609 435
Grants and donations
1 994 844
2 362 117
(15,55)
2 962 341
61 426
87 008
(29,40)
63 247
4 677 479
5 627 545
(16,88)
5 086 853
Capital replacement reserve
Revenue
A complete analysis of capital expenditure (budgeted and actual) per functional area is included in Appendix D to the annual
financial statements; while Appendix B contains detail according to asset class. More details regarding external loans used to
finance fixed assets are shown in Appendix A.
City of Cape Town Annual Report Executive Summary 2009/10
www.capetown.gov.za