Ralph Mathekga

Local government: Where state capture has led to state failure

2019-07-02 08:08
Auditor-General Kimi Makwetu addressing the media on Wednesday. (Jan Gerber/News24)

Auditor-General Kimi Makwetu addressing the media on Wednesday. (Jan Gerber/News24)

Multimedia   ·   User Galleries   ·   News in Pictures Send us your pictures  ·  Send us your stories

The state of municipalities in South Africa is the closest you get to state failure, a scenario where rules are broken systematically with impunity, writes Ralph Mathekga.

The level of financial mismanagement and lack of proper accounting practices across municipalities should be a matter of grave concern for South Africans.

The Auditor General's latest report on local government audits shows that only 18 out of a total of 257 municipalities have complied when it comes to adhering to proper accounting practices stipulated by the law. Therefore, when it comes to keeping proper financial records, there is only a 7% compliance rate across all municipalities. To put it differently, a total of 93% of municipalities are not able to tell a complete story regarding how they spent the public funds.

Let's get something clear before we go further with this. Failure to adhere to stipulated standards and practices when it comes to financial management in municipalities does not necessarily imply that money has been misused. Further, failure to maintain proper financial and performance records across municipalities does not necessarily mean that service delivery has not been met. In the case of South Africa however, there is a strong correlation between the decline in adhering to proper financial records and the decline of service delivery and the rise of corruption.

Quite often in South Africa, remarks are made that the main drive for local government should be service delivery and not necessarily an obsession with audit outcomes. The EFF even accused the DA of obsessing over audit outcomes instead of focusing on service delivery, implying that a municipality can fail to maintain proper financial and performance records, while succeeding at delivering basic services.

ANALYSIS: Municipalities owed Eskom R9.1bn last year - 10 statistics that show how they wasted your money

Municipalities should not obsess about audit outcomes to a point where service delivery is compromised. However, I am yet to come across a case where a municipality has an excellent record in service delivery amidst an excessively dismal record when it comes to financial record-keeping practices. This led me to the multibillion-rand question: what are the reasons for the progressive decline in financial record-keeping across municipalities in South Africa?

The Auditor General's report also indicates that only 19% of municipalities could provide financial statements without material misstatements. The rest, about 80% of municipalities, is a mixed bag of deliberate misstatements and perhaps to a limited degree genuine incompetence or lack of ability to maintain proper financial records. This means that 80% of the time, one cannot make sense of financial records coming from municipalities. Most of our municipalities' financial documents are deliberate gibberish, put together with the intention to deceive.

We should not be surprised about this horrid picture coming out of municipalities. If indeed there has been state capture as evidence is pointing out, we should expect an equivalent level of wrongdoing at local government level, perhaps even worse. The sad story of our local government is that in most cases municipalities are just impossible to audit due to a lack of credible information regarding what has been happening in those municipalities.

Our municipalities are gathering a reputation as turfs run by war lords who have captured their small enclaves where they do just about whatever they want to perpetuate their hold. This is more a rule than an exception, given that it is also an exception in South Africa for a municipality to perform well and keep proper financial records.

The state of municipalities in South Africa is the closest you get to state failure, a scenario where rules are broken systematically with impunity. Unfortunately, both the provincial and national spheres of government lack the moral rectitude to correct what is happening across municipalities because the two spheres of corruption are also no exception when it comes to rampant institutionalised corruption in post-apartheid South Africa.

- Ralph Mathekga is a political analyst and author of When Zuma Goes and Ramaphosa's Turn.

** Want to respond to the columnist? Send your letter or article to voices@news24.com with your name, profile picture, contact details and location. We encourage a diversity of voices and views in our readers' submissions and reserve the right not to publish any and all submissions received.

Disclaimer: News24 encourages freedom of speech and the expression of diverse views. The views of columnists published on News24 are therefore their own and do not necessarily represent the views of News24. 

Read more on:    local government  |  municipal audits
X

SHARE:

Inside News24

 
Traffic Alerts
There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.




Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.