Government may take over Umzinyathi municipality

2013-04-16 00:00

THE Co-operative Governance Department is poised to intervene in the Umzinyathi District Municipality (Dundee), which is apparently in the red to the tune of R350 million and in need of a bail-out.

This emerged yesterday after the ANC indicated it wants the provincial government to intervene in financially troubled municipalities.

Umzinyathi and other municipalities were identified as needing intervention from the Treasury and the Department of Co-operative Governance and Traditional Affairs (Cogta) at a recent ANC provincial summit on local government, where Finance MEC Ina Cronjé presented an analysis of the financial position of each municipality.

Taking over the administration of the affected municipalities has not been ruled out.

Yesterday, ANC provincial spokesperson Senzo Mkhize confirmed that Umzinyathi was one of the municipalities in financial distress. “There is a decision that there has to be an intervention,” Mkhize said, referring to a resolution of the summit.

“We were unable to say what type of intervention should be made,” he said, adding that the provincial government would decide on suitable action. Mkhize could not say what the problems faced by Umzinyathi were and what intervention the ANC preferred. “At the moment I can’t be specific because that depends on what the provincial government, Treasury and Cogta find during their assessment,” he said.

However, Mkhize said municipalities often experienced problems with revenue collection, over-reliance on conditional grants and governance-related matters.

Sources in Umzinyathi said the municipality was in the red by about R350 million and was considering seeking a bail-out from the Provincial Treasury or a loan from a finance institution.

Cronjé office would not comment on the matter yesterday, saying that all queries on the summit discussions should be directed to the ANC provincial secretary, Sihle Zikalala.

The Umzinyathi mayor and municipal manager could not be reached yesterday.

However, Cogta spokesperson Lennox Mabaso said Umzinyathi was among those municipalities being closely monitored by MEC Nomusa Dube. “I can confirm that Umzinyathi is one of the municipalities where there is some work she is doing in line with her responsibilities,” he said, adding that Dube was scheduled to visit the municipality.

Mabaso declined to say whether putting Umzinyathi under adminstration was on the cards.

Howver, he said Dube would engage with the council before intervening to ensure the municipality rendered services unhindered.

Mabaso said Cogta was obliged to render support to troubled municipalities and to take over their administration only when the situation did not improve.


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