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Treasury: Finance woes dog municipalities

Jan 15 2012 13:42 Sapa

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Johannesburg - Poor financial management has reached epidemic proportions among municipalities, according to a Sunday Times report.

Of the country's 278 municipalities, 66 are in financial distress, while another 37 municipalities are heading in the same direction, the Sunday Times reported, according to figures released by the National Treasury.

Symptoms of poor financial management included cadre deployment, crucial posts being left vacant, political interference and poor revenue collection.

Some municipalities struggled to pay employees and contractors, risking service delivery. This also created an environment conducive to corruption.

A significant number of municipalities underspent on capital items and grants, and there was a trend to cut infrastructure maintenance spending.

By the end of the financial year last June, 20 municipalities reported closing cash positions that exceeded one month's operating expenditure requirements.

Fifty municipalities failed to report closing cash positions, the paper reported.

 
municipalities  |  government spending

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