Matjhabeng Local Municipality in Welkom leads the pack of the country’s most wasteful municipal spenders.
The Free State municipality is first of the top 10 contributors to fruitless and wasteful expenditure, with the collective wasting R818m in the past three years, Auditor-General Kimi Makwetu said this week.
Overall, fruitless and wasteful expenditure in 2016/17 amounted to R1.5bn – an increase of 71% from R890m in the previous financial year.
The office of the Auditor-General defines fruitless and wasteful expenditure as money spent in vain or expenditure that could have been avoided if reasonable care was taken.
In the past three years, Matjhabeng wasted R187m, most of it (R182m) spent on interest on debts to Eskom. The rest related to penalties and interest owed to the SA Revenue Service and other creditors.
The municipality’s woes are not over yet. It is currently in a legal battle with debt collection company Zandile Management Services over the cancellation of its contract three years ago. The company’s owner, Fikile Bili, alleges that the contract was illegally cancelled because of political pressures that resulted in the removal of a “credible” municipal manager from office. The man, Bili said, was removed because he did not ask his company to pay kickbacks.
A Matjhabeng resident who asked not to be named said her municipality was “as good as closed” because of a lack of services.
“Finances are gone, governance is nonexistent and sewage is running down the streets of Thabong. It’s actually one of the worst municipalities in this country,” she said.
Matjhabeng Local Municipality spokesperson Kgojane Matutle denied Bili’s claims, but declined to comment because the matter was sub judice.
Matutle said the municipality has 500 000 households and used to thrive while the mines prospered, but now it has a huge unemployment rate after a number of mines closed, leaving over 250 000 people jobless.
“Consequently, revenue collection is a challenge and it goes without saying that the indigence registry has gone up significantly. We are also confronted by ageing infrastructure and the highest rate of copper, cable and steel theft of street lights, stop signs and manhole lids.
“Loss of electricity and water through illegal mining activities has placed a huge burden on the municipality to keep up with its debts to Eskom and Sedibeng Water, among other creditors,” he said.
Matutle said the Matjhabeng executive mayor, Nkosinjani Speelman, has asked Free State safety MEC Sam Mashinini to intervene since the municipality’s core function is not policing.
For the first time since its inception in 2000, Matutle said the municipality has received an unqualified audit report.
“This shows that we are indeed improving and working towards improving our books. The chairperson of the municipal public accounts committee in Matjhabeng, together with his committee from various political parties in council, has also played an instrumental role in ensuring that senior officials who contribute to irregular, fruitless and wasteful expenditure are held accountable and that there is consequence management,” he said.
“The new administration is working tirelessly to take Matjhabeng to greater heights. However, we acknowledge that it won’t be an easy task given the current economic climate.”
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