Chief Executive Officers’ overview (Annual Report 30 June 2016). 

Our approach is based on our Code of Business Ethics (‘the Code’), which applies to all of our businesses and employees of the entity. Operating within the Code enables us to meet our obligations to all of our stakeholders, while also delivering real business benefits. It protects our reputation and our ability to grow and enhances our efficiency. Our people are able to work productively in a safe environment and we reduce the risk of incidents and associated costs.

The financial year 2016/17 has been a very busy year where we made a lot of efforts to improve the municipal entity’s’ electricity infrastructure in order to stay a moving force in the industry and a credible electricity provider to Mangaung and the southern Free State.

The entity invested a total of R 222 562 922 in capital projects, mainly funding infrastructure projects such as the establishment of 132/11KV 20MVA distribution centres in Fichardt Park and Cecilia which were energised by the 30 June 2017. Effecting significant improvements to the electricity infrastructure has become our major priority. Among other successes, we were able to connect to the electricity grid 548 households in the MMM area. 262 public connections applications were received and successfully installed within the stipulated policy deadlines by 30 June 2017. Furthermore, 30 high masts were erected and 21 commissioned in MMM (Bloemfontein, Botshabelo and Thaba ‘Nchu).

It is further worth mentioning that CENTLEC (SOC) Ltd has successfully installed 2 777 smart street lights in the MMM area.

The municipal entity’s Training and Development Centre continues to participate in industry-wide activities aimed at not only improving the electrical engineering profession, but also at protecting the integrity of the quality of training offered to the candidates. In addition, the entity has facilitated job creation and empowerment opportunities by allowing 126 learners to receive on-the-job training in various technical fields and 136 learners received institutional training, of which 64 successfully passed the trade examination and are now qualified electricians.

The entity has also managed, through its revenue protection strategy, to reduce the number of meters running on estimates from R17 000 000 in prior year to R4 000000.

During the year, the entity embarked on an intensive programme to reduce electricity distribution losses. Meters were inspected for tampering, illegal connections were disconnected and the users fined in line with the Criminal Matters Amendment Act (Act 18 of 2015). The result was a decrease in the electricity distribution losses from the 13.23 % in the prior year to 10.77 % which is a 2.46% reduction of R17 662 493.

In order to capacitate its employees, the entity enrolled 100 employees on a three-year Municipal Financial Management Program which was completed during 2016/17 financial year.

Management developed an Audit Action Plan to address issues raised by the Auditor General in the 2015/16 management and audit reports. This was vigorously monitored and implemented to the effect that the entity has been able to retain the prior year’s opinion as unqualified audit outcome.

The entity has experienced challenges relating to the general industry trends which include but not limited to:

• Fatalities are as a result of members of the community who embark on unsafe illegal connections, despite all our efforts to ensure public safety.

• The presence of private suppliers of prepaid meters encroaching on the entity’s core business.

• The declining customer consumption pattern due to alternative energy sources.

• The challenges in recovering the long outstanding book debt.

• The impact of all the above challenges has been the drop in the projected revenue while the expenditure pattern has not dropped in the same direction. This has significantly contributed to the overspending of the budget on the non – cash flow items as reported in note 51 to the Annual Financial Statements.

This annual performance report represents our further commitment to continue working tirelessly and striving hard to meet all our communities’ needs. This has seen us further developing and implementing various strategies to enhance service delivery and ensuring safety of our communities in doing so.

I would like to appreciate the endless support and leadership guidance provided by the Board, the commitment and dedication of all members of staff and unions. It is through your efforts that the organisation continues to excel in its activities. We will continue to take the necessary steps to ensure our revenue collection increases and ultimately provide improved quality service.

Lastly, I would like to thank all the stakeholders, particularly the shareholders and provincial government for their willingness to support and engage on issues of joint interest.




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