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BUDGET SUMMARY2.2.1 MEDIUM TERM REVENUE AND EXPENDITURE FRAMEWORK OUTLOOK: 2013/14 - 2015/16A. OPERATING EXPENDITUREOperating Expenditure FrameworkThe City’s expenditure for the 2013/14 budget and MTREF is informed by the following:Modelling of feasible and sustainable budgets over the medium term;National Treasury guidelines;Growth in the City and continued economic development:The municipal’s indigent policyCognisance of national and local economic and fiscal conditions;Expenditure limits set by realistic and realisable revenue levels;The City’s asset renewal strategy and its medium to long term asset repairs and maintenancegoals;Relevant (budget and other) legislative imperatives.The operating budget increases from the adjustment budget amount of R 4,780,6 million in2012/13 to a new budget amount of R 5,350,4 million (representing an increase of 11.92% (R569,8 million) in 2013/14. The allocation of the outer two years of the MTREF period is R 6,022,6million and R 6,538,5 million respectively.The following table is a high level summary of the MTREF budget for 2013/14 to 2015/16(classified per main type of operating expenditure):Expenditure per TypeBudget2012/13Adj.Budget2012/132013/14GrowthBudget2014/15 2015/16R ‘000 R’000 R’000 % R’000 R’000Employee Salaries & Wages 800,858 843,955 994,106 17.79 1,095,618 1,160,579Employee Social Contributions 153,265 165,475 190,530 15.14 204,400 218,786Total- Salaries, Wages & Allowances 954,123 1,009,430 1,184,636 17.36 1,300,018 1,379,365Remuneration Of Councillor S & Directors 46,207 46,207 49,536 7.20 53,285 57,004Centlec Seconded Employees Salaries 126,288 164,556 - -100.00 - -Centlec Employees Social Contributions 25,673 164,556 - -100.00 - -Total - Seconded Personnel 151,961 197,280 -100.00 - -General Expenditure 433,313 477,809 626,980 31.22 659,376 680,451Grants to Entity 138,233 138,233 119,467 -13.58 134,311, 142,927Bulk Purchases 1,478,735 1,478,735 1,602,367 8.36 2,026,660 2,324,317Contracted Services 231,167 321,598 297,134 -7.61 271,917 270,739Transfers & Grants 2,057 2,304 2,422 5.13 2,545 2,696Interest Shareholder 110,000 213,040 134,400 10.03 257,901 283,692Interest External Borrowings 61,799 163,855 202,054 23.31 215,365 231,108Repairs & Maintenance 238,250 266,857 296,889 11.25 218,723 344,356Inter Departmental Charges 75,550 75,550 81,799 8.27 88,008 96,647Inter Departmental Recoveries -14,041 -14,041 -15,502 10.40 -16,634 -17,822Service Rendered to Centlec 5,590 5,590 4,332 -22.50 3,230 1,880Depreciation 200,157 335,425 449,583 34.03 473,967 496,638Transfer to Bad Debt Reserve 142,989 142,989 270,010 88.83 293,525 311,846Transfer to Provisions 10,120 10,120 18,505 82.84 19,766 21,120Less: Amounts charged out -90,361 -90,361 -74,231 -17.85 -80,396 -86,587Total - Other Expenditure 4,175,848 4,780,621 5,350,381 11.92 6,022,566 6,538,467The above table can also be graphically depicted as follows:7