Councils to be watched

2009-08-05 00:00

EXPENDITURE by KZN municipalities is to come under closer scrutiny by the Provincial Treasury Department. A municipal finance unit has been set up for this.

Finance MEC Ina Cronjé said yesterday the municipal finance unit monitors the budgets of municipalities to establish whether they promote sound fiscal management. It also monitors implementation of municipal budgets, which includes expenditure, revenue collections and borrowing. “This is an area that needs to be given more attention if government wishes to ensure service delivery at grassroots level,” Cronjé said.

She added that her department’s observations at the municipalities have revealed challenges such as:

• Significant lack of financial controls;

• Poor record-keeping (partly due to inadequate systems and training);

• Lack of adequate policies, procedures and appropriate delegations of authority;

• Lack of good governance in supply chain practices;

· Inappropriate use of conditional grants;

• Inadequate billing systems;

• Inadequately skilled financial staff.

According to Cronjé, in addition to playing an oversight role, the unit also offers support to municipalities that do not have the capacity to manage their finances.

Nine municipalities have been helped so far, but as many as 31 require assistance.

Budget cuts have also affected the programme, but after the finance portfolio committee pleaded for more money for the unit, the Treasury Department boosted the unit’s coffers with funds accrued through cost-saving measures.

Finance portfolio committee chairwoman, Belinda Scott, thanked Cronjé and her team for finding the money.

IFP MPL Lionel Mtshali said financial mismanagement in government departments often result from performance contracts not being signed by senior managers.

“A public service that cannot measure the performance of its own officials, cannot hold them accountable for failures.

“At the same time, such a public service cannot acknowledge the hard work by the many dedicated public servants. This has to change,” Mtshali said.

The DA’s Johann Krog said that financial efficiency could be achieved through better organisation within government.

He suggested that the huge budgets of both Health and Education at R20 billion and R25  billion respectively, should each be split in half and given to two MECs to use.

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