Cronje: municipal finances problematic

2010-11-29 00:00

THREE districts in the province have contributed more than the provincial average of 3,58% in economic growth from 2002 to 2009 — Durban Metro, and uThungulu and iLembe districts.

Finance MEC Ina Cronje, in her 2009/10 municipal finance close-out report, said KZN is on a slow recovery path, but that there are still steep hills to climb.

Cronje went on to spell out areas that remain problematic.

She said that although municipalities are submitting their financial reports to her department on time, she is still concerned about the poor to average quality of the submissions.

The accuracy of some information is also “very questionable”.

The MEC said that while more municipalities are spending their capital budgets, underspending still remains a problem.

This has been attributed to poor planning, badly managed procurement processes and political interference in both capital planning and procurement processes, she added.

Poor debt management has increased the debts of muncipalities by 16,2% to R1,1 billion since the previous financial year, despite the intervention of provincial treasury.

Cronje said the reasons for this were:

• Failure of municipal managers to allocate sufficient staff to revenue collection;

• Poorly designed revenue management, indigent and debtor’s policies,which exacerbate the revenue collection challenges; and

•Unreliable debtors systems and data, which compromise effective billing and collections.

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