Mayor: City of Joburg bled billions in irregular, fruitless, wasteful expenditure

Johannesburg Mayor, Geoff Makhubo.
Johannesburg Mayor, Geoff Makhubo.

The City of Johannesburg has allegedly recorded R3 billion in irregular, fruitless and wasteful expenditure for the 2018/19 financial year, Mayor Geoff Makhubo claimed on Monday.

This after he met with the Office of the Auditor-General (AG) to discuss the financial state and health of the City. 

According to Makhubo, the AG's report "concurs with us that the financials of the City are reflective of some gross maladministration and possible fraud and corruption".

The newly appointed mayor charges the expenditure figures were a "reflection of a systematic push to dismiss competent officials over the last three years and to corruptly manipulate the procurement processes of the City".

"Also, of concern is that the City has also lost more than R617 million of much-needed service delivery grants back to the National Treasury over the last three financial years due to a failure to spend.

"Currently, a further R237 million in transport infrastructure grants may be withdrawn, and we are engaging Treasury to avert it as part of our efforts to turn around the financial state of the City," Makhubo said.

Waste

These funds could have been used for the benefit of residents who complained daily of potholes, leaking pipes and uncut grass in open spaces, as well as for the improvement of water, sanitation and human settlement infrastructure in the City, he argued.

Makhubo previously raised claims surrounding illegal procurement, poor contracting practices, delayed payments to creditors and unplanned, self-created emergency procurement situations under the previous administration. 

"Once more, as the government of local unity, we will create an environment where maladministration bordering on fraud and corruption does not thrive in the City of Johannesburg. We want to assure residents of Johannesburg of our commitment to bring services and finances of the City back to normality."

READ: Geoff Makhubo: Meet Joburg’s tainted mayor

Makhubo took over from his predecessor, Herman Mashaba, in December, shortly after the latter resigned from his position and subsequently left the DA and formed the People's Dialogue.

Mashaba previously accused the newly appointed mayor of reversing the gains the City had made under his tenure.

He was responding to earlier reports by Makhubo that the City was on the brink of financial collapse, News24 reported.

ALSO READ: Mashaba accuses successor of reversing gains the City of Joburg had made under his watch

Mashaba, in turn, retaliated by issuing a statement, saying "these antics by Makhubo were nothing new".

"From day one of the coalition government in 2016, Makhubo predicted the imminent financial collapse of the City, citing an impending inability to make the next salary run. This never transpired. 

"Contrary to these allegations, the pre-audit financial statements for the 2018/19 financial year reflected a significant improvement in the City's financial health and liquidity, with its closing cash balance increasing from R2.2 billion at the end of 2017/18, to R5.3 billion by the close of 2018/19," Mashaba previously stated.

The People's Dialogue said Makhubo's statement needed to be understood as "a desperate attempt to tarnish the work of the coalition government".

"The AG's report does not substantiate this claim - this is an attempt to take an accumulative report [over a number of years] and try [to] paint that as one financial year," its spokesperson, Michael Beaumont, told News24 on Monday.

"It is a very selective reading of the AG report, but we are not surprised in any way. Irregular expenditure is a long-term problem in the City but unfortunately three years is not enough time to turn around the decay of government in the City of Johannesburg."

The AG's spokesperson, Africa Boso, told News24 on Monday a report on "all municipalities will be issued in June 2020".

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