Auditor-General Tsakani Maluleke is concerned that only a few municipalities presented credible and useful performance information during the audit period.
AUDITOR-General Tsakani Maluleke is concerned that only a few municipalities presented credible and useful performance information during the audit period.
She told the National Council of Provinces, during a workshop on local government on Wednesday, that if only 24% of municipalities could present credible performance information it showed there was a lack of discipline in regards to performance planning, monitoring and oversight.
She added that only 28% of municipalities submitted credible financial statements for audit.
Maluleke said that these problems also point to the fact that recommendations from the Office of the Auditor-General are being ignored.
The A-G’s last audit report, which was released last June, showed that there were a number of problems in municipalities.
“If you turn to performance information a very similar picture emerges. Only 24% of municipalities were able to present credible, useful, reliable performance information for audit. Yes, a number of them corrected misstatements but the fact that only 24% could give us credible performance information tells us again that the disciplines of performance planning, monitoring, oversight and reporting are not yet in place.
“We have reported again on the persistently high level of non-compliance findings, which indicates that our annual recommendations largely remain unheeded.
“In our report, we largely set out in great detail that the financial health of municipalities continued to deteriorate and we highlighted that the indications of this were that there was significant doubt about the ability of a number of municipalities to continue to operate to the future.
“We indicated that some of the indicators were the inability to pay creditors, the inability to collect revenue and the inability to collect outstanding debt.
“We also talk about how a number of them were continuing to rely on the equitable share to run their affairs, to pay salaries and council remuneration, which then took away funding that should be available for service delivery, for the maintenance of infrastructure and for the ongoing provision of services to citizens.”
Many municipalities have over a period of time struggled to deliver services and are owed billions of rand by households, businesses and government departments.
The debt was sitting at R45 billion in 2010 but it has now shot up to more than R120bn.
The National Treasury has warned that most of the debt would not be recovered.
Maluleke said they need to instil discipline in the management of finances in municipalities.
“While many reasons can be cited for the poor financial health in local government, what we see is that the challenge tends to arise out of the inability to manage the funds that local government have.
“Our view is that we have got to insist on instilling those basic disciplines of financial management so that we can make sure that the funds we do have available are used in the most optimal manner,” she said.
– POLITICAL BUREAU
