South Africa’s municipalities have been unsuccessful at spending all their allocated budgets on new electricity connections. As at the end of October 2013, 74% (R858 million) of the R1.151 billion allocated transferred for the 2012/2013 programme was reported as being spent by municipalities. A total of 41,257 connections were reported as having been achieved, representing only 57% of the 72,335 planned connections for which funding had been provided.
For the 2013/14 programme, as at the end of October 2013, the total municipal allocation of R1.001 billion of the approved R1.314 billion for the 2013/14 financial year had been transferred to municipalities. Of this amount only R244 million (24%) was reported as having been spent while 12,076 household connections, or 14% of the target of 72,335 connections for the year, were achieved.
This raises the issue of the performance of municipalities in delivering on electrification connections and utilising allocations, with unspent funding and a shortage of planned connections dating back to the 2006/7 financial year being reported.
South Africa’s department of energy officials say that National Treasury is recovering unspent funding (or not reported as having been spent) from municipalities equitable share funding. Officials from both of these government departments are embarking on an exercise to clean-up the data from the previous years and close out the relevant performance reports. This will involve extensive visits to the offending municipalities to ensure that an accurate picture of the situation is established.
For the municipal 2014/15 allocations, the total value of the applications for funding municipal electrification projects in 2014/15 amounted to R4.398 billion. The total allocation (unapproved as at November 2013) for municipalities in this period, to be included in the documentation to be approved by government, was R1.564 billion.
Meanwhile South Africa’s new electrification strategy was yet to be finalised, despite the process beginning in April 2012. The master plan was due to have been completed by August 2013 and used to guide allocations for 2014/15. The deadline was later extended to November 2013 and, with data provided by municipalities still to be verified, the new target date is now March 2014.