The national executive committee (NEC) of the South African Local Government Association (Salga) has expressed concern about the weaknesses of municipal credit control and debt collection mechanisms in the country’s councils.
The discontent comes in the wake of concerning revelations by auditor-general Tsakani Maluleke last week when releasing the 2020/21 consolidated general report on local government audit outcomes.
The Salga NEC made the concession last week during its meeting in Kimberley, Northern Cape. The meeting followed a series of engagements with municipalities in the province on Tuesday and Wednesday last week.
The NEC met with mayors, speakers, whips of council, municipal managers, and chief financial officers from municipalities in the province against the backdrop of the release of the auditor-general’s report on municipal audit outcomes.
In a statement, Salga said the NEC engagement with member municipalities in the province saw the opening up of conversation that brought deep insight into the major issues affecting municipalities and their communities.
“Like elsewhere in the country, the management and solidity of coalition rule at the local government level remain a challenge in the province. The November 2021 local government elections saw the formation of 12 multi-party governed municipalities.
“In response to the rising trend of coalition governments since the 2016 local government elections, Salga, in close collaboration with the Dullah Omar Institute, drafted a Coalition Government Framework that provides practical guidelines to political parties and councillors on the formation and management of coalitions in local government.”
Salga said while the framework was not promulgated, municipalities are encouraged to draw lessons from the framework, which offers “practical guidance on how political parties can manage such coalitions in a manner that ensures the sustainability of municipalities and delivers the best outcomes for local communities”.
The inability of municipalities to manage their finances and collect revenue from ratepayers has a severe impact on their financial viability, the association said.
Salga spokesperson Tebogo Mosala said it is worrying that only five Northern Cape municipalities received clean audits, while others were given adverse opinions.
“A few had difficulty submitting their financial statements on time, and this may as well tell a story about the services municipalities in the province deliver, and their ability to earn the public’s trust and confidence.
“The NEC urged municipal leaders in the province to reflect on the state of municipal financial performance while identifying the root causes of persistent challenges that warrant accountability and consequence management,” said Mosala.
She said Salga would continue to avail critical interventions such as councillor training, capacity building programmes, and the municipal audit support programme in an effort to strengthen financial management capacity building in the sector.
Separation of powers and functions
Salga said a matter of critical importance that emerged during the NEC and Northern Cape municipal leadership engagement was the decision taken by the Sol Plaatje municipality to appoint its chief financial officer to the position of acting municipal manager.
“True to Salga’s mandate to provide advisory services to its member municipalities, the organisation wrote to the mayor of Sol Plaatje municipality and recommended that the appointment be rescinded. The chief financial officer and municipal manager cannot be the same person.
“The Municipal Finance Management Act defines and separates the role and responsibilities of mayors, councillors, and officials in the interest of oversight, accountability, and transparency, and the action taken by the municipality was not in accordance with the financial governance principles espoused in the act.”
Last week, Salga also raised concerns about the deteriorating quality of governance within municipality structures across the country.
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.
[At the time], Salga’s Sivuyile Mbambato said 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 are 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: “The deteriorating quality of governance and accountability that is fuelled by a lack of consequence management in municipalities is indeed a serious concern for Salga.”
Mbambato further said a lack of consequence management and the tolerance of incompetence drive a sense of impunity in the local government, adding that it accounts for the dwindling levels of accountability.
He noted that there will be no improvement in the local government structures if the transgressors go unpunished, adding that the Salga is calling for municipal leadership to hire competent staff.
He said: “The revelation by the report that municipalities spent R1.2-billion on consultants in the 2021/2022 financial year whilst paying finance department staff R10.4-billion is concerning.
“It points to the skills deficit in municipal finance departments, hence municipal leaders must ask themselves critical questions in an event that a chief financial officer is unable to produce a credible financial statement.
“The tolerance by councils of ineptitude coupled with a lack of consequence management cannot continue unabated. Salga calls for the appointment of skilled and professional staff who are competent. Mediocrity must never be tolerated.”
–SAnews.gov.za
Also read: Corruption, collusion at local government level worries Salga
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