Municipal money: the good, bad and ugly

2016-10-30 06:56
Nkomazi is one of the country’s most improved municipalities. (Picture: Sizwe Yende)

Nkomazi is one of the country’s most improved municipalities. (Picture: Sizwe Yende)

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Three years ago, Mpumalanga’s provincial cabinet surprisingly excluded the Nkomazi Local Municipality from a list of councils it placed under investigation.

The decision smacked of political expediency and, instead of firm action, Nkomazi, which received a disclaimer opinion by the Auditor-General after an audit of its finances, got a support team.

Today, Nkomazi – based in Malelane and encompassing 54 rural villages – is one of the country’s most improved municipalities.

National Treasury’s municipal money tool reveals that Nkomazi ended the last financial year with an unqualified audit outcome and a healthy bank balance of R39.1 million.

None of its budget was fruitlessly or wastefully spent. The council is also raking in some outstanding debts with a whopping 238% collection rate.

Acting chief financial officer Sipho Matsaba said:

“We tightened screws and closed the taps so as not to be susceptible to fraudulent activities.

“We curtailed costs such as catering for functions and meetings, unnecessary travel expenses and accommodation, and put a moratorium on filling vacant posts in order to do more with the little that we have.”

This, Matsaba said, was how the municipality paid off its R57 million debt to Eskom.

Like all rural municipalities, Nkomazi has many poor families, and only collects rates and taxes from four towns – Malelane, Hectorspruit, Komatipoort and Marloth Park – and government departments.

The municipality, which relies on national government for almost 70% of its income, also makes some money from licences, fines, interest and investments. Its total budget in the 2015/16 financial year was R1.1 billion.

About 72 000 households living on communal land don’t pay rates. Residents, 35% of whom are unemployed, also depend on free basic electricity and water.

The population is also rising, with immigrants from neighbouring Mozambique and Swaziland placing the municipality’s resources under more pressure.

“The census misses these people because most of them are [undocumented] immigrants,” Matsaba said.

“We pay the price as we don’t get the right equitable share from national government because the population is understated.”

The official figure for the municipality’s population is 393 030.

Nkomazi is still struggling to pay its debts, and has not managed to spend anything on repairs and maintenance of its roads, sewerage plants and other infrastructure this past financial year.

Matsaba says the infrastructure is too old and the municipality has been focusing on replacing or upgrading much of it.

This can be seen in Driekoppies village 35km from Malelane, with its collection of fancy homes, more modest dwellings and low-cost government houses.

The roads here are potholed and streets inside the village are neither paved nor tarred. Young people mill about the streets and spaza shops.

Mirriam Mashaba (62) sits, sewing, on a wooden bench outside her RDP house, under an electric cable that connects her home to the pole in the street.

Just less than a kilometre away, a high mast light towers above the village.

Mashaba says electricity is one of the services the Nkomazi local municipality is able to provide, along with free refuse collection.

“Although it goes off when it rains, we have electricity supply most of the time,” she says.

The pensioner, who lives with her two unemployed adult children and four grandchildren, says they struggle for water because her house is on the high-lying side of the village and the water pressure is not strong enough to reach her.

Still, she’s happy it’s free.

“I get water from my neighbours’ taps,” she says. “Those lower down get water in their taps.” - Sizwe sama Yende


At first glance, the North West village of Makapanstad looks developed, with its schools, clinic, library and attempts to pave the streets.

The potholed roads linking Moretele municipality’s villages are not residents’ biggest problem; it’s the water shortages, the responsibility of the Bojanala District Municipality.

In the scorching noon heat, Margaret Mabelane (66) queues among scores of men and women, eyes fixed on water dribbling from a tap, holding their breaths that it should not be the last drop.

Coming from as far as Dertig and Dan Hall villages, they line up their containers hoping to go home with some clean water, even if it means queuing for hours. This is one of the most crowded water points just on the doorstep of Carousel Casino along the R101.

“This is the story of our lives. We spend more time queuing for water here and while we share a drop, it hurts me most when I go to other places and see people waste water,” Mabelane said.

About 30km away, cattle were enjoying the fruits of overnight rains in the green wetland along the trickling Moretele River. A good time for cattle, but taps were dry in the nearby Kgomo-Kgomo village. Pensioner Maria Matloa from neighbouring Kontant village said in days like these they are forced to share water from the river with the cattle.

“We buy clean water for drinking and cooking and get water from the river for washing and other things. Things are really bad in our villages and people are slowly losing hope,” she said.

Municipal Money revealed that Bojanala officials overspent their capital budget of the past financial year by 154%. It’s hard to see where that money went.

Moretele’s financial track record is dismal, with two disclaimer and two qualified opinions in the past four years.

The municipality clocked 139.74% in fruitless and wasteful expenditure in the 2013/14 financial year.

It only spent 1.38% repairing and maintaining infrastructure over the same period, and underspent its capital budget by 15.57% – which could have financed new water pipes.

With a population of over 180 000, Moretele gets 81.28% of its money from national government.

In the last report, the Auditor-General raised serious concerns around supply chain management irregularities.

“I pray for the day I will spend a day at home without pushing a wheelbarrow and queuing for hours just to get water,” said Mabelane. - Poloko Tau


For the past four years, King Sabata Dalindyebo municipality has maintained it’s disastrous audit outcomes – disclaimers in both 2012 and 2013, to the slightly less bad qualified audit opinion in the following two years.

Information published in National Treasury’s Municipal Money shows that the municipality, based in Mthatha, with nearly 452 000 residents, had a commendable bank balance of R40 million at the end of the last financial year.

But the municipality underspent its capital budget by 39%, meaning cash that could have been used to fix electricity and potholes or to build a library was not spent. Also, nearly 44% of its operating budget was fruitlessly or wastefully spent, up from 4.3% in 2012.

The municipality is also doing badly on the debt collection front, with only 62% collected.

Meanwhile, shoddy service delivery is residents’ biggest frustration.

Ikhwezi township, one of the oldest residential areas in Mthatha, has suffered numerous power cuts for years, with no solution on the horizon.

Businessman Anele Jezile, who works from his Ikhwezi home, says they live in a permanent state of “uncommunicated load shedding”.

Two years ago he was forced to buy a generator for R9 000 to stay in business.

And last week he had to spend R2 000 on his motorised gate because when the power comes back on, surges damage electrical appliances.

“Every night in Ikhwezi there is no electricity. I don’t know what the municipality is using the money on. Our roads are filled with potholes all over the township and Mthatha. What’s worse is that when the power goes off, so does the water sometimes,” Jezile said.

Another Ikhwezi resident, Fikile Faku, known as DJ Stax, said for the past two months they’d been going without power for up to six days at a time.

“Most of my appliances have been damaged. In August, when the power went off, I heard a big noise. My iMac computer, studio monitor speakers, microwave and two hi-fi systems and even my DStv decoder were damaged.

“I was busy recording my second album and lost all of the work I had already done,” he said.

The municipality did not respond to requests for comment. - Lubabalo Ngcukana

Read more on:    treasury

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