A financially stable metro

from ConneCT 2022

The evolution of man and fire

Earlier in 2022, the City was ranked among the top performing municipalities in South Africa. According to Ratings Afrika’s annual Municipal Financial Sustainability Index (MFSI) report, the City was the only metro still considered to be financially stable for 2021 with a score of 67, outperforming the rest of the metros by a large margin.

Cape Town was the only metro to remain stable in its financial sustainability over the year in review, which speaks volumes of what the City is doing. Ratings Afrika’s Municipal Sustainability Index looked at operating performance, liquidity management, debt governance, budget practices, affordability and infrastructure development. It then gave a score out of 100 and the City scored 67, the only metro still considered to be financially sustainable.

In addition, the ratings agency Moody’s recently retained the City’s outlook as stable, noting that its debt levels remain lower than most of its rated peers in South Africa. The City’s strong debt management practices, sturdy liquidity and robust financial performance were recently reflected in ratings agency Moody’s having retained the City’s outlook as stable (Ba3/NP).

According to the Moody’s rating report, the rating outlook reflected the City’s “moderate financial performance, supported by prudent financial management and a large and diversified economic base. The City has consistently reported robust operating surpluses and strong liquidity, and its debt levels will remain lower than most of its rated peers in South Africa.”

Supporting suppliers

Closer to home, the City pays on average 99% of supplier invoices within 30 days, making sure that it enables especially small and medium businesses to keep their cash flow and operations going. Much work has been done in contract management over the past few years to make sure businesses are paid on time in Cape Town to boost the economy and protect livelihoods. In the current financial year, approximately R10 billion has been spent on purchase orders both in operational and capital budgets.

The City’s excellent supplier payment track record and these various independent and well-respected accolades indicate that the City of Cape Town continues to deliver services in a sustainable manner to the businesses and residents located within the metro.

The City continues to improve where improvements are required to boost its management of public resources and deliver on its core mandate of basic service delivery. As South Africa’s City of Hope, Cape Town is set to rise to new levels of service delivery over the coming decades.

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