The City says that only R178 million of the R1.5bn Urban Settlement Development Grant (USDG) had not been spent. Picture: City of Cape Town/Supplied
The Cape Argus would like to correct a subheadline which appeared on Monday’s edition. The headline incorrectly stated that the City had “Failed to use over R178 million of R1.5 billion Urban Settlement Development money”. Instead it should have stated that only R178 million of the R1.5 billion had not been spent. We apologise for this error.

Cape Town - The City says that only R178 million of the R1.5bn Urban Settlement Development Grant (USDG) had not been spent.

Felicity Purchase, the City’s acting Mayco member for finance, said: “This financial year still carried the remnants of one of the worst natural disasters to hit South Africa.

“The impact of drought conditions within Cape Town on especially the City’s 18/19 expenditure within the Water Services Department is thus still being experienced. For instance, some programmes had to be halted out of necessity. The City had to prioritise programmes to get Cape Town through the worst drought in its history,” she said.

The City, however, envisaged that the impacts of the various drought-related projects would be worked out of the system and the City would get back to its “high performance” levels in this regard.

The City, along with Mangaung, was identified at a recent Portfolio Committee on Human Settlements, Water and Sanitation for not spending its grants. According to the Department of Human Settlements USDG Consolidated Budget and Expenditure report as at the end of June this year, the City was allocated R93 935. As much as 100% of that budget was unspent.

Purchase said there were a number of reasons at play that contributed to why the City couldn’t spend its USDG, “Other reasons include high levels of crime, community unrest and vandalism, which has caused some contracts to be delayed or cancelled. The City is in the process of applying for roll-over funding as per the Division of Revenue Act, which means the money is not lost as it will get applied again in the next financial year,” she said.

Last year it emerged that DA-run cities such as Johannesburg and Cape Town had lost nearly R540m meant to cover the cost of providing infrastructure for poor households due to non-performance.

Former finance minister Nhlanhla Nene stopped the transfer of R363m to the City of Johannesburg, while Cape Town forfeited about R176m.

While campaigning for the ANC in Delft, President Cyril Ramaphosa slammed the DA, charging that the provincial government had failed to use nearly R1.7billion in funds allocated for housing.

Chairperson of the Portfolio Committee on Human Settlements, Water and Sanitation, Rosina Semenya, said: “ The committee called on Mangaung and the City of Cape Town to spend the allocated Urban Settlements Development Grant. They are currently the only metros that have not spent over 90% of allocated funds.”

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