IMPROVING LIVES THROUGH DATA ECOSYSTEMS

Salary bonuses and changing seasons shift municipal spending, according to data from Stats SA’s latest Quarterly financial statistics of municipalities report.

Bonuses paid to municipal staff drove up employee-related costs at the end of 2014. Municipalities spent R19,3 billion on employees in the quarter ended December 2014, decreasing to R17,6 billion in the quarter ended March 2015. This is an annual occurrence; notice the peaks in the chart below?

Interestingly, although municipalities have increasingly spent more on employees over the last five years, the contribution of employee-related costs to total expenditure has fallen. Municipalities spent R11,3 billion on employee-related costs in the quarter ended March 2010, rising to R17,6 billion in the quarter ended March 2015. However, the percentage contribution of these costs to total expenditure fell from 30,1% to 26,7% over the same period.

Municipalities also spent less on electricity purchases in the quarter ended March 2015. Municipalities purchase electricity from Eskom, which they resell to residential, business and industrial customers. Purchases of electricity decreased by 4,4% (R0,6 billion) in March 2015 compared with December 2014. Sales of electricity also decreased by 3,8% (R0,8 billion) in March 2015 compared with December 2014.

The drop in electricity purchases and sales was a result of decreased demand from customers, who use comparatively less electricity during the summer months compared with winter. Electricity demand slumps every year in the quarter ending March.

Gauteng was the largest contributor in terms of sales of electricity in the quarter ending March 2015, followed by KwaZulu-Natal and Western Cape. The smallest contributing province was Northern Cape.

To download the complete report, click here.