Eleven municipalities in the North West have successfully paid their employees’ salaries after their previously withheld equitable shares from the National Treasury were finally released.
The funds were withheld by the National Treasury due to the municipalities’ failure to settle outstanding debts with creditors.
The MEC for Cooperative governance and human settlement Oageng Molapisi explained that the funds were withheld as a result of the municipalities’ financial struggles.
Issues resolved, funds released
However, he reassured that payment plans were put in place, and arrangements were made to resolve the issue.
He said this development brings relief to the municipalities. It also marks a hopeful step toward financial stability for the municipalities involved.
This was heard on Friday at the provincial executive council quarterly media briefing held in Mahikeng.
Several municipalities could not pay their workers on time last month. These include including Ditsobotla Makwassie Hills and Mamusa local municipalities.
Molapisi said the failure by the municipalities to pay the salaries was due to the withheld equitable shares.
Non-payment to entities
“Part of the reason was that they did not pay their debt to entities like water boards and Sars. We have engaged with all affected municipalities. And I can confirm that for all those municipalities whose equitable share was withheld by the National Treasury, the treasury has released them,” he said.
Molapisa said, however, it must be noted that the municipalities were highly reliant on the grants.
“The norm is for municipalities in terms of revenue collections to collect 95%. But we know that many of our communities are very poor, they can’t pay. And municipalities depend largely on the grants. So we are encouraging municipalities to device other means of ensuring that they don’t only depend on the grants,” he said.
Adhering to Treasury’s conditions
Provincial finance MEC Keneetse Mosenogi said there was post-interaction with municipalities. They were adhering to the conditions of the Treasury to commit to how they were going to service their third parties.
“We want to emphasise that the implementation of the financial recovery still rests with the municipality. This to ensure the financial health of the municipalities.
She said the financial viability of the municipality and raising revenue was a primary focus of those municipalities. This is including the municipal manager together with their senior managers.
“We have encouraged them to look at alternative sources of revenue. To also improve their collection, and billing systems, update their records, and have another alternative. This so that the municipality is not only reliant on the equitable share. But in the revenue that is collected every month from those who are reliant on municipal services that are provided at a fee,” she said.
Premier urges sustainability
Provincial premier Lazarus Mokgosi added: “For the mere purpose that they are grant reliant and they cannot generate revenue, the provincial government comes in. It comes to support them and ensure that they develop better strategies on how to generate revenue.
“We are depositing skills that are required to do that kind of work. But there must be some form of sustainability and cooperation. They must be able to sustain themselves. And they can’t sustain [themselves] if they don’t adopt what we bring. So, cooperation and collaboration are important,” Mokgosi said.
