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Millions3 2003 0002 8002 6002 4002 2002 0001 8001 6001 4001 2001 000800600400200‐Expenditure per VoteBudget 2012/13 Adj Budget 2012/13 Budget 2013/14 Budget 2014/15 Budget 2015/16B. OPERATING REVENUE BUDGET - HIGHLIGHTS AND REASONS FOR SIGNIFICANTVARIANCESOperating Revenue FrameworkFor the Mangaung Metropolitan Municipality to continue with its quality service provision there is aneed to generate the required revenue. The municipality is facing serious service backlogs and apoverty struck community.The municipality’s revenue strategy is built around the following key components:National Treasury’s guidelines and macro-economic policy;Projected city growth and continued economic developmentRealistic revenue management, which provides for the achieving of the collection rate target;Electricity tariff increases as approve by the National Electricity Regulator of South Africa(NERSA);Setting of trading services’ user charges at levels which are reflective of these services’ costrecovering nature;The municipality’s Property Rates Act Policy approved in terms of the Municipal PropertyRates Act, 2004 (Act No 6 of 2004) (MPRA);The municipality’s policies to assist the poor en rendering of free basic services; andSundry Tariffs policies.The operating revenue budget is projected at R 6,297,9 million in 2013/14, representing anincrease in revenue of R 741.9 million (13.35%) in 2012/13 Adjustment Budget of R 5,556 million.The allocation for the outer two years of the MTREF period is R 7,115.5 million and R 7,800.4million respectively. Revenue generated from rates and services charges forms a significant partof the revenue basket of the city. Rates and services charges constitutes 55.6% (2012/13 -54.63%) of the budgeted revenue (excluding capital grants and transfers) in the 2013/14 budgetyear.Details of the revenue by source are as outlined in the below table:14