Sakeliga has accused auditor-general Tsakani Maluleke of concealing crucial information pertinent to corruption and misconduct in over 150 municipalities.
Sakeliga legal and liaison officer Tian Alberts said the organisation has initiated a lawsuit against the the auditor-general compelling her to publicise undisclosed management reports.
Alberts said the Maluleke has by far released only the summary audit reports “while the advanced management reports were reserved for the municipal and other state authorities themselves”.
According to Alberts, the release of the management audit reports would herald a new era in municipal litigation, accountability for state officials, and disclosure of how taxes were spent.
“Although the auditor-general has a constitutional duty to make the management reports public, it has never been released,” said Alberts.
“The management reports differ from the summary reports that are released annually, as they contain detailed information on specific instances of corruption, wasteful spending, management problems, fruitless expenditure of tax money, and other irregularities as discovered by the audit teams.
“In contrast to this, the auditor-general’s normal annual headline audit reports, which are available to the public, are of summary nature.”
Alberts shared that Sakeliga, a business community taking up its constitutional duty to resist state power and reform failing business environments, found out about the existence of the management reports during its litigation on municipal failure in North West.
“In January 2022, Sakeliga requested access under the Promotion of Access to Information Act to the management reports on 154 distressed municipalities countrywide, where there exist severe problems with service delivery and financial administration.
“The auditor-general denied Sakeliga’s application. We, therefore, [on Thursday] filed papers in the North Gauteng High Court in Pretoria for a ruling to compel the auditor-general to release the management reports to Sakeliga,” he said.
Sakeliga intends to analyse and release these reports to chambers of commerce, civil society organisations, and the general public to support them in their efforts at handling state failure and improving greater local economic independence.
“Because of their detail and scope, the management reports could be instrumental in litigation and other interventions by businesses and civil society in general to reverse local economic deterioration.
“In the meantime, Sakeliga expresses its appreciation for the thorough work by the auditor-general in identifying in her annual management reports the decay, mismanagement, and corruption at municipalities.
“Our position is, however, that the auditor-general’s annual reports offer little value to the public if left undisclosed.”
Maluleke has been granted 15 court days to file a notice to oppose the application.
In June, Maluleke released a report on the financial and audit outcomes of municipalities. Although the report, which consists of insights on the state of financial strength and accountability systems, showed an increase from 27 to 41 municipalities that received clean audits with no findings, it painted a dire situation regarding the financial wellbeing of the municipalities.
The findings depict incompetence in terms of accountability and consequence management within the local government structures.
The South African Local Government Association (Salga) concomitantly raised concerns over the deteriorating quality of governance within municipality structures. Salga spokesperson Sivuyile Mbambato said at the time that a new approach is needed to enforce accountability and consequence management.
“2020/2021 auditor-general’s report on local government paints a gloomy picture about a lack of accountability in municipal finance management,” said Mbambato.
“This calls for a new approach to enforce accountability and consequence management. A carrot and a stick approach, where excellence is rewarded whilst mediocrity and maladministration is punished, is what is needed to turn local government around.
“Whilst Salga is disappointed with the findings of the auditor-general’s report, Salga welcomes the report as it provides some key lessons on what works, identifies areas of improvement, and those municipalities that require serious and urgent intervention.”
Mbambato added that the deteriorating quality of governance and accountability that is fueled by a lack of consequence management in municipalities is a serious concern for Salga.
The municipal watchdog also acknowledged the existence of corruption and collusion in municipal tenders, stating that it has requested Maluleke to provide a list of the transgressors so the department can act against them.
“Municipal officials are moonlighting [and] doing business with the state, let alone with the municipalities in which they are employed. This must come to an end, it cannot be tolerated any further.”
Also read: Corruption, collusion at local government level worries Salga
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