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Division of Revenue Act, 2012 (Act No. 5 of 2012)

Chapter 3 : Conditional Allocations to Provinces and Municipalities

Part 1 : Conditional allocations

8. Conditional allocations to municipalities

 

 

1) Conditional allocations to local government in respect of the financial year from the national government's share of revenue raised nationally are set out in Column A of the following Schedules:
a) Schedule 4, specifying allocations to municipalities to supplement the funding of functions funded from municipal budgets;
b) Schedule 6, specifying specific-purpose allocations to municipalities;
c) Schedule 7, specifying allocations-in-kind to municipalities for designated special programmes; and
d) Schedule 8, specifying funds that are currently not allocated to specific municipalities, that may be released to local government or municipalities to fund disaster response within a period from three days up to three months following a declared disaster in terms of the conditions of the Disaster Management Act.

 

2) An envisaged division of conditional allocations to local government from the national government's share of revenue anticipated to be raised nationally for the next financial year and the 2014/15 financial year, which, with the exception of what is provided in subsection (4) in relation to the Public Transport Infrastructure and Systems Grant, and which is subject to the annual Division of Revenue Acts for those years, is set out in Column B of the Schedules referred to in subsection (1).

 

3) The National Treasury must, in terms of section 15, publish the share or indicative allocation of each municipality in respect of the local government allocations contemplated in subsections (1)(a) to (d) and (2) in the Gazette.

 

4) Despite subsection (2), in respect of the Public Transport Infrastructure and Systems Grant, funding which is specifically approved by the National Treasury in relation to transport contracts for capital projects must be regarded as being firm allocations for the next financial year and the 2014/15 financial year that will not be altered downwards in the Division of Revenue Acts in respect of those financial years.

 

5)
a) Subject to paragraph (b), a municipality may only after obtaining the approval of the National Treasury, pledge, offer as security or commit to a person or institution future conditional allocation transfers due to the municipality for the next financial year and the 2014/15 financial year, for the purpose of securing a loan or any other form of financial or other support from that person or institution.
b) Prior to granting an approval in terms of paragraph (a), the National Treasury must-
i) inform the relevant transferring national officer of a request by a municipality for approval to pledge, offer as security or commit to a person or institution future conditional allocation transfers due to the municipality as referred to in paragraph (a); and
ii) provide a period of three working days for the transferring national officer to provide comment to the National Treasury on the municipality's request for approval, unless this period is extended by the National Treasury.