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MUNICIPALITIES SPEND MORE ON STAFF THAN COMMUNITY SERVICES

27/04/2024 08:11:00 Sabelo Majola

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MBABANE – Most local municipalities are spending more on salaries, wages and allowances than they do in services to the people.

Services to the people are in respect to construction and rehabilitation of roads infrastructure, upgrading of traffic lights, skip collection, waste collection and disposal, among other services. For example, at the Municipal Council of Mbabane, it was observed that over the years, environmental management, community and preventative health services costs, which is direct service to the ratepayers, the municipality spent E3 438 447 in 2023 while E4 836 115 was spent in 2022.

In respect to planned roads maintenance and drainages, the council spent E21 252 702 in 2023 whilst E19 759 310 was spent in 2022. The combined figures for these community services were E24 691 149 in 2023 and E24 595 425 in 2022.

Spends

This is less than half the council spends on salaries and wages as observed in its annual reports for the aforementioned financial years. In 2023, the council spent E53 787 203 on both salaries and wages for its staff members and the figure was E49 334 048 in 2022.

In Matsapha, employee costs, inclusive of salaries and wages, Eswatini National Provident Fund, pension and funeral amounted to E20 034 694 in 2023 and the figure was E19 830 in 2022. However, community services initiatives whose costs were outlined in the council’s annual report, amounted to E6 380 000. This is in respect of installation to LED lights at Tubungu Township, a project that cost E500 000. The breakdown of the services include that the council undertook a rehabilitation project of King Mswati III Street.

This included the rehabilitation of the street junction, walkways, pipe culverts and drains. Through this project, the town has realised an improvement in the traffic flow as well as an improved drainage system along that street. The project was implemented for five million Emalangeni (E5 000 000). As a way of protecting pedestrians and improving road safety, Eswatini Beverages partnered with the council in the installation of concrete bollards along Ludvonga Street. The E250 000 project was implemented over three months resulting in safety improvements for pedestrians as well as motorists.

During the 2022/23 financial year, the council began with the implementation of a Street Addressing Project. Street addressing refers to an exercise that makes it possible to identify the location of a plot or dwelling on the ground and the project cost was E230 000. As a measure of easing traffic congestion in the town of Matsapha, the council implemented a Traffic Lights upgrade along MR103 and Ludvonga Street at a cost of E150 000.

In an effort of improving the council’s efficiency in processing building applications in the town of Matsapha, the council developed a Town Planning Application Software. This project was implemented at a cost of E250 000 and would benefit the town’s stakeholders who seek to process their building applications. Community services at the Manzini Council are depicted as establishment costs and they amounted to E35 935 553 in 2023 and E34 144 090 in 2022.

Expenses

However, employee benefit expenses, in respect to salaries and wages, employee benefit costs and allowances, gratuity, leave and pension fund contribution, amounted to E43 310 768 in 2023 and E35 634 580 in 2022. Although the difference is not glaring, but the employee benefit expenses are higher than the services to the ratepayers.
Uniform in the council’s report depicts that the cost of short-term employee benefits, (those payable within 12 months after the service is rendered), are recognised in the period in which the service is rendered and are not discounted.

The expected cost of compensated absences is recognised as an expense as the employees render services that increase their entitlement or, in the case of non-accumulating absences, when the absence occurs. The councils pay contributions to publicly or privately administered pension insurance plans on a mandatory, contractual or voluntary basis. “Once the contributions have been paid, the council has got no further payment obligations.

The regular contributions constitute net periodic costs for the year in which they are due and as such are included in staff costs,” reads one of the reports. Pigg’s Peak Town Council Chief Executive Officer Mzwandile Ndzinisa said about 56 per cent of Pigg's Peak Town Council's budget for the 2024/25 financial year was directed to service delivery , that is capital projects (road construction and other public facilities), social services such as three early childhood care points, upkeep of the town, such as grass cutting and refuse collection.

“Based on this expenditure pattern, I believe that as a organisation we are customer-focused,” he said. Matsapha Town council Communications Officer Sihle Sihlongonyane said, like all the other municipalities in the Kingdom of Eswatini, the council followed an extensive and transparent budgeting exercise where all stakeholders of the town are invited to make their budget contributions on these activities that they would love to see being implemented by the council in that particular budget year.

He said these activities were guided by the five-year developmental plan known as the Integrated Development Plan. “In the budget preparation, council takes into record the number of projects that need to be implemented by the council and ensures that the budget is spread across various departments that focus on ensuring that council delivers quality and excellent services to the town’s stakeholders,” he said.

Compensation

Concerning the part of the budget being allocated towards employee compensation, Sihlongonyane said the council followed the World Bank's guidance that outlines that local government institutions should seek to ensure that employee compensation is kept at between 40 and 50 per cent as municipal work was labour intensive.

“That being said, it implies that projects funds should be sourced from national and international organisations as rates are predominantly for the maintenance and upkeep of council operations. The council remains committed at all times that service delivery is at a maximum despite the challenges that may arise,” he said.

Manzini Public Relations Officer Mathokoza Thwala said that the claim suggesting that the municipality spends a disproportionate amount of its revenue on staff costs compared to service delivery was incorrect. He said the municipality adhered to national and globally acceptable benchmarks; as prescribed by the national government and the World Bank, respectively. He also mentioned that practising fiscal responsibility remains a priority in the municipality.

“According to the World Bank standard, staff costs to total revenue (less capital costs) are limited to 40 per cent. May we also reassure all stakeholders that Manzini Municipality maintains a diligent approach to financial management; ensuring that expenditure is well-balanced between staff costs and service delivery,” he said.
Of note, is that the country’s municipalities are only empowered to raise their developmental funds through property taxation only as a main revenue base.

This is achieved through the Rating Act of 1995, which empowers the municipalities to annually assess and levy a general rate on all immovable property within the urban jurisdiction. It is worth mentioning that property taxation is based on the market value of land and improvements (buildings) which economically appreciate continuously depending on the country’s economic performance and other factors.

However, ratepayers across the country are often complaining about poor service delivery and the main complaints are centred around poor infrastructure like pothole-riddled roads and observable overgrown vegetation in the urban areas.

Requests

Mbabane Ratepayers Association Secretary General Bruce Jameson said they had written numerous letters to the municipality and although he did not divulge much on what the letters entail, he did say that it was mainly on requesting the implementation of some services within the municipal areas but the requests were yet to be attended to. “Everybody has a breaking point. We have engaged the municipality several times through letters but we are not getting feedback,” he said.

Vice Chairman of the Association Solomon Nxumalo said service delivery was what the ratepayers were paying the rates for. “The rates are primarily for services so why pay them if you are not getting the services that you are paying for,” he wondered. It should be noted that not all the municipal areas are alive with overgrown vegetation or pot-hole riddled roads.

For example, a drive through the Malkerns Town reflects that the municipality was doing incredibly well in maintaining the road and municipal employees were observed along the road clearing and cutting vegetation. Streetlights are functioning well and very few potholes were observed along the road. Matsapha is alive with pot-holes; particularly the road leading to the different textile industries in the town and the municipality is helping the situation by putting sand in the potholes.