NATIONAL NEWS - The municipality had not adopted a funded budget since before the Covid-19 pandemic.
In 2021, Beaufort West adopted an unfunded budget and was subsequently assessed as being in financial crisis.
Declining revenue collection left the municipality unable to pay creditors, including Eskom, and resulted in delays in paying municipal employees.
The provincial government subsequently intervened under Section 139(5) of the Constitution, while National Treasury developed a Financial Recovery Plan. Implementation of the plan began in March 2022 under the oversight of the Western Cape Government.
R94.2m debt relief
As part of its financial recovery, Beaufort West qualified for municipal debt relief relating to Eskom and bulk water debts.
If both debt-relief programmes are successfully completed, R94.2 million owed by the municipality could be written off.
The municipality has already received confirmation that it successfully completed the first two phases of the Eskom debt-relief programme.
Audit outcome improves
The municipality has also recorded an improvement in its audit outcome.
Its audit opinion improved from qualified to unqualified for the 2024/25 financial year, indicating progress in financial governance.
The municipality also achieved 98% capital spending during the 2025/26 financial year.
Western Cape Provincial Treasury has confirmed that, based on a methodology prescribed by National Treasury, the municipality's 2026/27 budget is both credible and funded.
Ministers welcome progress
Western Cape Minister of Finance Deidré Baartman said sound governance was essential to strengthening Beaufort West's economy, creating jobs and rebuilding business confidence.
She congratulated Mayor Duimpies and the municipal leadership on reaching the milestone, while noting that several targets in the Financial Recovery Plan still need to be achieved to ensure long-term stability.
Western Cape Minister of Local Government, Environmental Affairs and Development Planning Anton Bredell said sound financial management and discipline were important foundations for municipalities seeking to improve service delivery and attract private-sector investment.
He also praised the municipal leadership for the work undertaken to improve Beaufort West's financial position.
What is a funded municipal budget?
In municipal finance, a funded budget means that planned expenditure is supported by realistic and reliable sources of funding.
Section 18 of the Municipal Finance Management Act (MFMA) requires municipalities to budget only for expenditure they can afford. This can include realistically anticipated revenue, cash-backed reserves and confirmed grants or transfers.
Revenue projections must also be realistic and informed by current and historical collection trends to ensure that municipal budgets are credible and evidence-based.
The adoption of a funded budget therefore represents an important step for Beaufort West, although the municipality's financial recovery process is continuing.
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