According to the 2004/05 Budget Review document, tabled by Finance Minister Trevor Manuel during his Budget speech in Parliament yesterday, these transfers will total R17-billion in 2006/07.
Local government would receive an additional allocation of R3,9-billion over the next three financial years. About R1,7-billion of this would go into the Municipal Infrastructure Grant, which enables municipalities to address backlogs in infrastructure and to promote the creation of jobs through the Expanded Public Works Programme (EPWP).
The balance will go to the local government equitable share, which contributes to free basic electricity, water and sanitation services for poor households.
The local government equitable share rises from R7,4-billion in 2003/04 to R8,5-billion in 2004/05.
Total infrastructure grants increase to R5-billion in 2004/05, from R4,1-billion in 2003/04.
On average, infrastructure transfers to municipalities increase by 13 percent a year over the three-year medium term expenditure framework (MTEF).
Infrastructure grants are conditional and municipalities are expected to use them to benefit poor households.
Capacity building and restructuring grants have fallen from R901-million in 2003/04 to R723-million in 2004/05.
Over the next three years, key financial reforms in local government will be driven by the implementation of the Municipal Finance Management Act, which will take effect on July 1, 2004. – Sapa.
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