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SA councils misuse R13bn

Jun 27 2010 08:56 Antoinette Slabbert

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Pretoria - A whopping R13bn – this is the sum that municipalities wasted or failed to spend in their previous financial year.

The wastage and poor management are evident in the qualified audit reports that by far most municipalities have received from the auditor-general (AG).

The amount is equal to the annual budget of the department of justice, or it could finance half a Gautrain.

About R5bn of the R13bn is owing to exceptional distribution losses in water and electricity, write-offs of consumer debt and fraud.

More than half of these losses occurred in Johannesburg, Ekurhuleni and Mogale City.  With the announcement of the consolidated report on municipalities' audited results AG Terence Nombembe said there was an evident, although slight, improvement in the financial management of municipalities for the 2008/09 financial year compared with those for 2004/05.

Although the number of qualified and unfavourable audit opinions - as well as opinions withheld - declined sharply from the previous financial year, only four municipalities in the country received clean audit reports. This is the same number as in the previous financial year.

The four are Johannesburg, Cape Town, the Kareeberg and the Frances Baard district municipalities in the Northern Cape.

 - Sake24.com
terence nombembe
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