A Guide for Councillors

The Role of Councillors in Municipal Finance Management

Part 4

It is not always possible to include all the needs that the community prioritised in the fi rst year of a budget. Councillors need to consult with the community about which items can be included later in the three-year budget cycle. Councillors need to make sure that the municipality is sustainable. This means that they have a stable income over the long-term. Municipalities can build long-term sustainability by: budgeting to look after and maintain their equipment. This prevents breakdowns and disruptions to services provided to the people working out what large projects they must budget for working out what it will cost to keep new projects going being extra careful when agreeing to contracts that take longer than three years to complete. 4.2 Linking budgets to municipal plans The IDP is the council’s plan for developing the municipality during it’s term in of fi ce. Councillors should approve a budget that meets the plans set out in the IDP. • • • •

THE PEOPLE IN SECTION C OF MY WARD ARE VERY POOR, BUT ARE WILLING TO PAY WHAT THEY CAN. WE BUDGETED FOR WHAT THEY COULD PAY.

WE WEREN ‛ T EXPECTING SO MANY NEW SHACKS IN THE WARD. THE BUDGET WAS TOO LITTLE TO PROVIDE SERVICES TO ALL OF THEM. MOST OF THE PEOPLE IN THE INFORMAL SETTLEMENT CANNOT PAY FOR SERVICES.

The IDP and budget are reviewed each year to accommodate changes and problems that arose in the previous year.

The council reviews the IDP at least once a year in conjunction with the budget. The council may amend the IDP based on this annual review. The IDP will generally remain in force until the next elected council adopts its IDP, although the process should remain fl exible and responsive to changing council and community needs.

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Understanding the Municipal Finance Management Act