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Municipality to be put under administration

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"Council is dysfunctional and it is drowning in so much debt"

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PHOKWANE municipality, which owes Eskom, Vaalharts Water and other creditors in the region of R125 million, will be formally placed under administration on Monday.

The Northern Cape Department of Co-operative Governance, Human Settlements and Traditional Affairs (Coghsta) is in the process of appointing administrators to oversee the municipality.

Meanwhile, no progress has been made in implementing the findings of the Section 106 investigation report that was compiled in 2015 and only presented to council in January this year.

The report investigated maladministration, corruption, non-compliance and malpractice at Phokwane Municipality.

The MEC for Coghsta had given the municipality an ultimatum to provide a progress report on February 23, while council had indicated that it was still seeking legal advice on the report.

The recommendations include criminally charging the former municipal manager of Phokwane for gross financial misconduct, non-compliance with supply chain management processes and contravening municipal finance regulations.

Eskom had threatened to implement electricity cuts of up to 14 hours a day due to a R10 million debt, but suspended the bulk electricity supply interruptions after a payment was made.

Phokwane mayor Sentse Kalman and Speaker Horatius Modiakgotla, despite being told to step down by the ANC last year following protests and an outcry from the community, are still occupying their posts at the municipality.

The municipal manager, Matshidiso Mogale, who was also told to resign, is still on suspension. She was accused of approving a salary hike and increased benefits for herself without authorisation from council.

The BMW of a director at Phokwane Municipality was torched outside his residence in Hartswater in November last year after a decision was taken to suspend the municipal manager.

Freedom Front Plus (FF+) chairperson of the provincial legal committee Theo Joubert said yesterday that the municipality was in such a state of financial disrepair that little could be done to salvage it from the ruins.

“It appears to be coincidental that the decision to place the municipality under administration comes shortly before the court case launched by the FF+ to prevent Eskom from cutting the power supply due to non-payment by Phokwane Municipality is scheduled to be heard in the Northern Cape High Court in June,” said Joubert.

He added that part of the court application included placing the municipality under administration.

“If the municipality is placed under administration before the court date, we may not be able to go ahead with the court application.”

Joubert, however, welcomed the decision to place the municipality under administration.

“It is a step in the right direction, if decisive action is taken to implement a financial recovery and rescue plan.”

He believed that council would have to be dissolved. “Council is dysfunctional and it is drowning in so much debt that it will take a few years to bring it back on track.

“There has been no political will to rescue the municipality and it has been years of unmanageable debt that has accumulated. Treasury and the minister of Co-operative Governance and Traditional Affairs will also have to be involved.”

Joubert added that while an investigator had been appointed by the public protector after the FF+ laid a complaint regarding the stagnation of the Section 106 report after it was released, the party had not received any further feedback on the progress of the investigation.