Uncovering and fixing old wrongs

2017-08-17 06:05
DILAPIDATED FLEET: The poor condition of Kouga’s service fleet is being addressed. Photo:SUPPLIED

DILAPIDATED FLEET: The poor condition of Kouga’s service fleet is being addressed. Photo:SUPPLIED

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SINCE taking over Kouga in August 2016, we have discovered that there are a number of financial claims and serious matters of non-compliance hanging over the municipality like a dark cloud.

1. Old debt to Department of Transport

The municipality failed to pay over drivers licence monies to the Department of Transport for several years under the two previous Councils. At the time of the 2016 election, the outstanding amount stood at about R11 million. We are paying this off in line with an arrangement made with the Department.

2. R46-million water bill

Following the election, the new Council was shocked to find that the Nelson Mandela Bay Metro had issued Kouga with a water bill for R46 million. This was in addition to the monthly water bill. According to the Metro, Kouga had been under-billed for water usage between 2012 and 2016. The bill had been issued to Kouga in May 2016 but had not been disclosed by the previous Council. Negotiation with the Metro regarding the bill is ongoing.

3. Court case: 2012 St Francis Bay canal fire

A court case that the municipality is defending could potentially cost the municipality between R30 million and R40 million. The claim arises from the 2012 fire that saw scores of houses being razed to the ground in the St Francis Bay canal area.

4. R13-million bill from the Dept of Labour

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The municipality hadn’t submitted RoEs from 2007 to 2016. This meant that municipal employees did not have proper cover for Injury on Duty claims for almost ten years.

The municipality has since come to an arrangement with the Department for workmen’s compensation to be reinstated and is negotiating paying off the outstanding amount.

5. Sheriff of the Court

The municipality lost various cases against aggrieved employees prior to August 2016 but failed to pay out the awards that had been made to those employees.

As a result, we have had to deal with several old labour claims over the past year while the municipality also almost lost nine of its vehicles because of this failure.

On 19 July the Sheriff of the Court arrived at Kouga’s workshop to attach a truck and eight bakkies in terms of an execution warrant that had been granted in favour of two aggrieved employees who had won their case against the municipality in 2015. The Labour Court had made an award to them, but this was never paid.

The municipality had to pay R152 000 to avoid the vehicles being removed. This included the award money to the employees, as well as court and sheriff charges.

6. Failure to pay creditors within 30 days

It is a requirement that a municipality pays all its creditors within 30 days, something that was not happening in Kouga under the previous Council.

In order to improve the municipality’s cash flow so that creditors can be paid within the required period, a Cost Containment Policy was adopted while revenue enhancement remains an ongoing focus.

7. Unauthorised expenditure written off

One of the outstanding matters inherited from the previous Council was unauthorised expenditure totalling R288 million, which had been accumulated from 2009 to 2014.

The previous Council had attempted to write it off but the Auditor-General was not satisfied that a proper investigation had been conducted to determine whether anyone could be held accountable and if any of the monies were recoverable.

MPAC consequently conducted a thorough investigation into the expenditure, following which Council approved the writing off of the expenditure in line with the prescripts of the MFMA.

8. Bloated staff structure

In addition to permanent staff totalling more than 800, the municipality had more than 200 contracted workers at the time of the election. Too much of the municipal purse was going towards staff costs to carry the bloated structure.

Council, therefore, had to make the difficult decision not to renew the employ of contract workers so as to make more money available for service delivery.

In order to ensure that contracted work would continue, the organogram was reviewed and a number of critical vacancies identified for filling in 2017/18.

9. Employment Equity Plan (EEP)

The previous two Councils failed to adopt an Employment Equity Plan in accordance with Section 20 of the Employment Equity Act (No 55 of 1998). We pursued this very important legislative requirement vigorously and adopted the municipality’s first EEP in seven years on 29 June 2017.

10. Dilapidated fleet

One of our early discoveries after the municipal election was the shocking condition of the municipal fleet.

Early reports showed that of the 220 vehicles in the fleet, only four were in a good condition and fully operation. 58 vehicles were no longer operational at all and a further 14 were on the verge of becoming redundant.

A five-year fleet replacement plan is being finalised to address this serious shortcoming.

Provision was made by the new Council in the 2016/17 Adjustments Budget to purchase two refuse compactor trucks and two mesh trucks. A total of R 8,8 million was also approved for the purchase of new vehicles in the 2017/18 budget.

11. RDP title deeds

MPAC has been investigating the recent handing out of title deeds at Hankey by the East Cape Department of Human Settlements.

185 title deeds were handed over without proper beneficiary verification before Council was able to put a stop to it. The handing over of title deeds will resume once the investigation has been completed and we are satisfied that the title deeds will be going to the correct beneficiaries.

12. Clamping down on corruption

An Anti-Corruption and Fraud Prevention policy has been adopted by Council to clamp down on corruption.

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