Cape Town’s economic growth has fallen behind that of the country’s other large metropolitan areas and the city has failed to spend more than 60 percent of its operating and capital budgets in the 2004-2005 financial year.
These were some of the findings of a special report on the country’s major cities, in which economic growth, governance, development and the economic welfare of the population were examined.
A city’s failure to spend its budget effectively indicated poor governance, the report says. And Cape Town performed worst in this field, despite having the highest-paid city manager at the time.
‘South African cities continue to have inequality measures’Cape Town had economic growth of only 2,9 percent between 2001 and 2004, compared to Johannesburg’s 5 percent, Tshwane and eThekwini’s 4,5 percent and Ekurhuleni’s 4,8 percent.
And while the city’s poorest population segment has seen a marginal increase in living standards, its middle class has lost out.
Cape Town has been credited with improved service delivery, but was found to have spent too little of its budgets for development.
The State of the Cities report indicates that Cape Town, with Johannesburg and Tshwane, had the highest gross value added (GVA) figure per capita of the metro areas surveyed.
Cape Town’s economic growth (2,9 percent) was considerably lower than the average (just 4 percent) of South Africa’s nine largest cities.
The report was the second State of the Cities report released by the South African Cities Network, identifying the weaknesses and strengths in the way municipalities manage urbanisation and economic activity.
The municipalities surveyed include Buffalo City (East London), Cape Town, Ekurhuleni Metro, eThekwini, Johannesburg, Mangaung (Bloemfontein), Msunduzi (Pietermaritzburg), Nelson Mandela (Port Elizabeth) Metro and Tshwane.
The report notes that growth in these metros was driven mainly by the commercial and finance sectors and that consumer and property booms had been particularly noticeable.
The report says Cape Town has also shown very little change between 2002 and 2004 in living standards measure (LSM) with modest losses to the middle bands, but small gains in the lowest and highest categories.
The household Gini coefficients for the nine areas suggest that there has been a small reduction in the levels of economic inequality between 2001 and 2005, but the report still remarks that inequality in the cities remains “dramatically high”.
“South African cities continue to have inequality measures similar to some of the world’s most unequal societies,” it says.
Even in Cape Town, which has the lowest Gini coefficient of the nine, the report describes the inequality in the city as “comparatively high”.
“This worryingly high level of inequality points to an urgent need to address equity concerns and implement poverty reduction strategies,” the report says.
The Gini coefficient is an indicator of income distribution, taking into account the highest and lowest incomes of a population.
While all nine cities would be classified as having medium levels of human development, Cape Town, Tshwane, Johannesburg and Ekurhuleni fall in the above-average city score.
Of the nine cities surveyed, Cape Town spent the least of its budget, which is the third largest (R17,1-billion), after Johannesburg and eThekwini.
The proportion of the budget spent provides an indication of good governance. If a municipality has the capacity to spend close to all of its budget, this indicates that systems such as financial services and service delivery are working well.
In the 2004/05 financial year, Cape Town spent just over 60 percent of both its operating and capital budget, while Johannesburg spent more than 100 percent.
eThekwini spent 90 percent and 95 percent of its capital and operating budget respectively, while Tshwane spent almost 98 percent and 89 percent respectively.
Despite the poor performance, Cape Town had the highest-paid city manager of the nine cities in 2004/05, earning an annual salary of R1,104-million.
Considered far better off now than they were in 2000, the cities surveyed have a firm foundation for improved performance over the next five years, the report says. Cape Argus
R8,5m Western Cape land remains unclaimed
More than R8,5-million is still waiting to be collected by 662 land restitution claimants in the Western Cape.
The Western Cape Land Claims Commission said the claimants had not collected the funds, which were available in cash vouchers, and the process had been suspended until the applicants were located.
“These are the people whose claims were settled from 2003 onwards and who, during the land claims process, opted for financial compensation instead of getting their land back,” said commission spokesperson Franz Zottl.
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