Overstrand Municipality’s Final Budget, Final Integrated Development Plan (IDP) Review and amendment, as well as the Final Disaster Management Plan for 2025/26 was approved by Council on 29 May 2025, and will be in effect from 1 July 2025.

In his first budget speech for Overstrand, Executive Mayor Archie Klaas highlighted the difficult financial climate globally, nationally and facing the municipality. He added that many households are struggling to afford municipal services, which adds pressure to the municipality’s ability to deliver services effectively. Despite this, he stressed that the key priorities must remain job creation and local economic growth.

The Mayor noted that after the tabling of the draft budget at the end of March 2025, it led to 164 public submissions from the community. All comments were considered for the final budget.

The major concerns raised included

• tariff affordability,
• baboon management,
• management of informal settlements, and
• indigent relief.

Mayor Klaas said it’s important to note that municipal cost drivers differ from the basket of goods and services used to determine CPI. For example, employee costs, a major budget component of 29.9% of the total budget has seen an increase of 7.5% having increased through national bargaining agreements, and bulk electricity purchases (26% of operating costs) have increased by 11.32%.

The current baboon management programme has been extended until January 2026. A review, in consultation with Cape Nature, will include a public participation process before any final decisions are made.

The Mayor noted that the indigent support programme provides free basic services – including 70kWh electricity, 10kL water, 7kL sewerage, and monthly refuse removal – to low-income households earning up to four times the old-age SASSA grant.

To further support vulnerable residents, the residential property value ceiling for rates relief will increase from R300 000 to R350 000. This means homes valued up to R350 000 won’t pay property rates. (Vacant properties are excluded.) Additional residential rebates and indigent services remain in place.

Tariff Increases

The approved budget for 2025/26 MTREF, provides for tariffs increases for the respective municipal services ranging between 6% and 10%, the details as follows –

• Property Rates: 9.7%
• Water: 6.2%
• Sewerage: 6%
• Refuse Removal: 6%
• Electricity: Approx. 9.96% (Electricity tariffs are based on a NERSA-required cost of supply study to ensure fair, cost-reflective pricing across all consumer categories)
• Sundry Tariffs: 6% unless otherwise stated

The Mayor emphasised that availability charges help cover the fixed costs of maintaining a 365-day operational service and ensuring infrastructure is in place to deliver services to all properties across Overstrand, whenever and wherever needed.

BUDGET OVERVIEW 

• Operational Expenditure:112 billion
• Revenue (excl. capital grants):018 billion
• Accounting Deficit: – (R94.5 million)
• Capital Budget:3 million

Grant Funding included in Operational and Capital Budget:

• National: R260.1 million
• Provincial: R87.2 million

HOW THE BUDGET WILL BE SPENT

Operating Budget: R2.112 billion

• Employee & Councillor Costs:8 million (29.96%)
• Bulk Electricity Purchases: ~R549 million (approx. 26%)
• Other Operating Expenditure:2 million (approx. 44%)

Capital Budget: R258.3 million

• Water Infrastructure:7 million
• Electricity Infrastructure:2 million
• Wastewater Management:6 million
• Waste Management:9 million
• Housing: 5million
• Sport & Recreation: 9million
• Other: 5million

Capital Funding Sources

• Borrowing:3 million
• Cash Reserves:4 million
• Capital Grants (National & Provincial):5 million

Towards the end of the budget speech Mayor Klaas confirmed that the Care projects allocation of R50 000 per councillor will continue, along with an allocation for  ward specific projects to meet community needs.