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I am a Simple Guy Please Help me Understand This

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Here is yet another example of how a bit of bull poo poo can help place a person or instance in a good light whilst totally confusing me no end – see the press release received from the Nelson Mandela Bay Metro Communications department below:

Mandela Bay billed the highest proportion to projected revenue among SA municipalities by the 3rd Quarter

Among the 283 municipalities in South Africa, the Nelson Mandela Bay Municipality billed the highest proportion of its adjusted revenue projections by 31 March this year, shows a report released by the National Treasury this month.

This proves how well the municipality assessed and forecasted consumption trends in the Bay. It shows in-depth knowledge and understanding of the consumers of its services and their responses to tariff trends. This accuracy in projecting revenues goes well for the sustainability of the municipality as it may help prevent cash-flow challenges that come with unrealistic projections of expected income.

The municipality billed 72.4% of it’s budgeted revenues by the third quarter of the current financial year and the increase in electricity consumption in the last 3 months will make up for the apparent 2.6% shortfall.

Okay I will admit that, on first read, my eyes glazed over, my brain froze and I had the refrain WTF ringing in my head. But, at heart I am a good news kind of guy who really wants only the best for Port Elizabeth, so I took the time and did the following:

  1. Opened the 10 June press release from Treasury and looked for further clarification of just what this good news could be
  2. Went to the Treasury web site and downloaded a number of reports
  3. All the while getting more and more frustrated in my desperation to finally understand the release and then be able to dazzle you with my brilliant summation of this excellent kudo for our beleaguered municipality.

The summary of the release is actually quite simple;

“The Nelson Mandela Bay Municipality’s adjusted budgeted revenue streams are an amount of R6 182 077 860 for the 2010/11 financial year. As at the end of the 3rd quarter 72.4% of that revenue had been billed. The municipality expects to bill an amount equal to the budgeted projection as a result of the increase in winter electricity consumption”

What can I say except; “Son of a gun that was a fascinating journey in economics and twisted semantics! Thanks for raising my expectations for, well, basically nothing.”

All Joe Public wants to hear is the following; how much is owed to the Municipality, how much does the Municipality owe and how much cash is in the bank – the rest is just noise.

Treasury reports that, at the end of March 2011, the Nelson Mandela Bay Municipality had a closing cash flow balance of R475 076 000. Put that into perspective as follows: The adjusted budgeted operating expenditure for the 2010/11 financial year is R6 035 990 211 which equates to R502 999 184 having to be paid out per month. Now March’s closing balance is the HIGHEST for the reported period, in February the closing cash flow balance was R163 637 020.

Let’s put the reported (UNAUDITED) cash flow balances in perspective – if you consistently start out the month with less money in the bank than you know you are going to have to spend then you are in a CASH CRISIS.

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Alan Straton

Chief Cook, Bottle Washer and Broom Mechanic at MyPE
Passionate about Port Elizabeth and definitely NOT packing for Perth. Alan's ethos is epitomised in the words of Nelson Mandela; "I have fought against white domination and I have fought against black domination. I have cherished the idea of a democratic and free society. If need be, it is an ideal for which I am prepared to die." See more articles by Alan.

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  1. Now if that boggled my mind can you imagine what it did to the majority of uneducated Port Elizabethans – WOW! I often think that the more Gobbledy Gook that is published, the more people become disinterested and the more this nonsense or corruption can be swept under the carpet, perhaps there is method in the East Cape Educations Departments madness of trying to keep the population uneducated so that the wool can be pulled over more eyes. 🙁