Lack of funds at Amajuba

2015-11-17 12:00

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Pietermaritzburg - Amajuba District Municipality is experiencing financial constraints and cannot keep up with its monthly salary bill which is said to be R7 million excluding third-party payments.

The municipality has confirmed having used funds ring-fenced for conditional grants to pay for October salaries.

A member of the executive council, who asked to remain unnamed, said the municipality had already filed a R18 million bank overdraft to pay for November salaries.

Amajuba spokesperson Sibonelo Cebekhulu was hesitant to answer questions around the bank overdraft.

“The issue of the said overdraft, if such exists, would be necessitated by the timing differences in our cash inflows,” he said.

However, a councillor who was present at the council meeting said it had been agreed that the overdraft will be paid back once the municipality receives its R40 million equitable share at the end of the month.

“It is nothing new really. Last year also the municipality had to apply for overdraft and repaid the bank after receiving its equitable share,” said the councillor.

According to the Auditor General’s report of 2013/2014 outcomes, Amajuba contributed R337 million in unauthorised expenditure.

Department of Co-operative Governance and Traditional Affairs (Cogta) spokesperson Lennox Mabaso blamed this on a “technical administrative error”.

“They have become victims of their own success. They over-prioritised service delivery and they ended up in this situation.

“It has supported its local municipalities, such as Dannhauser to be the first to achieve 100% access to electricity. It has for the first time provided water and sanitation including solar energy to communities in Utrecht,” he said.

Cebekhulu said using money ring-fenced for conditional grants would not affect service delivery.

“These funds will be refunded when we receive our equitable share allocation in November.”

Cebekhulu said the financial situation in Amajuba was being “over-exaggerated”.

“A municipality ‘not doing well financially’ would not be continuing with its service delivery initiatives like we are doing. We take pride in the fact that we continue to deliver services with a focus on water and sanitation.

“This municipality continues to supply water through water tankers to communities residing in the furthest areas of Emadlangeni because of the drought situation. We have never been caught not being able to deliver such services because ‘we are not doing well financially’,” he said.

Cebekhulu said the current administration had “inherited a municipality with huge service delivery backlog”.

“These conditions oblige us to start from scratch and execute projects that should have been implemented 10 years ago. By the time we get to our service delivery plans, there is simply not enough funding for all the necessary projects,” he said.


Read more on:    pietermaritzburg  |  funding

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