Plans to blow City’s budget

2017-04-06 14:02
R35 mln contractor's budget up to R444 mln.

R35 mln contractor's budget up to R444 mln. (File)

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The Msunduzi Municipality is planning to blow the budget by paying close to two billion rands over the next four years for contracted services.

Contracted services include the use of consultants and service providers contracted by the municipality.

According to the municipality’s draft budget for 2016/17, the municipality has adjusted contracted services from the original budget of R35 million to a whopping R444 million.

The municipality is also planning to spend a staggering R420 million in the 2017/18 financial year, R445 million in 2018/19 and a further R472 million in 2019/20.

The budget will be presented to council on May 30, and the DA has already said it will not be supporting it.

The spending comes amid pleas from Co-operative Governance and Traditional Affairs MEC Nomusa Dube-Ncube, who has urged municipalities to stop hiring consultants to prepare municipal financial statements.

This, she said, was done at a considerable cost without direct accountability for municipal audit outcomes.

The cost for contracted services will skyrocket over the next few years — in 2013/14 the municipality spent R21 million, R29 million in 2014/15 and R65 million in 2015/16.

In his audit report last year, Auditor- General (AG) Kimi Makwetu found that KSA Security, which had a contract with the municipality, had inflated its prices.

According to Makwetu’s report, KSA was paid R86 735 142, vastly more than the R22 561 048 it received the previous financial year.

DA caucus leader Sibongiseni Majola has slammed the forecast as excessive spending.

“This is quite scary. They know they cannot expect us to support this kind of spending on the use of consultants when we still have so much service delivery issues that need to be attended.

“Such use of consultants raises many questions about the competency of our staff.

“Are they not competent enough to do their jobs that we need so much help from consultants?

“What is also worrying about this is that KSA is part of the contracted services.

“We have not heard about the results of the inflating of prices in that contract, yet they want to increase funding. Do they want to pay KSA more?”

Municipal spokesperson Thobeka Mafumbatha said the costs had been affected by National Treasury’s new system, the Municipal regulations on a Standard Chart of Accounts (MSCOA).

“There are cost categories that have been affected by MSCOA format of reporting. Contract services is one of those.”

Majola said this did not make sense as Msunduzi finance staff have already been trained on the MSCOA system, yet the additional consultant costs were being factored in over the next four years.

Mafumbatha, responding to the inflation of prices in the KSA contract, said that “the security contract is a legal document between the municipality and the service provider in question”.

“Terms and conditions of the contract as such become the responsibility of both the municipality and the provider and it is not discussed out of that environment.

“The auditor-general’s query is work that is being currently dealt with within the structures of the municipality.

“When all this has been done, it will be submitted to the AG,” Mafumbatha said.

Majola also asked why the municipality needed to contract a security company when it had its own security personnel.

“Where were these security personnel during the break-in at municipal sheds at Alexandra Park?”

The municipality is also planning to cut down on public safety, which also includes traffic officers.

In the current financial year, the municipality will spend R81 million on this function, compared with R248 million spent in the previous year.


Read more on:    msunduzi municipality  |  pietermaritzburg

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