Cape Town – Cooperative Governance and Traditional Affairs Minister Pravin Gordhan has welcomed the Auditor General’s report on municipalities, saying it shows a consistent improvement in almost all aspects of municipal audit outcomes.
The Minister said this shortly after Auditor General Kimi Makwetu announced a noticeable increase in the number of clean audits of municipalities and municipal entities for the 2013/ 14 financial year.
“The report points to a steady trend towards good governance and sound financial management. This reinforces more efficient and accountable basic service delivery in line with the ‘Back to Basics’ approach,” he said.
The Minister launched the Back to Basics Strategy in September 2014 to ensure municipalities get the provision of basic services right, as well as ensuring that they enhance their communications approach in order to listen to concerns from the public more effectively.
Talking about the results on Wednesday, the Minister said of the 335 municipalities and entities audited, 102 improved, 194 remained constant, 27 regressed while two were new and 10 were still outstanding.
“Auditees with financially unqualified opinions now account for 76% of the total local government expenditure budget of R315 billion. This means that almost eight out of every ten rands spent by local government is spent by entities with financially unqualified statements.
“The report recognizes that a concerted effort was made to address irregular expenditure,” he said.
Special attention for underperforming municipalities
Minister Gordhan said as part of the Back to Basics Strategy, special attention will be given to the 50 municipalities that received disclaimed audit opinions, particularly the 25 that received disclaimed opinions for the past five years.
He said the main reason for disclaimed opinions was due to inadequate or missing supporting documentation caused by a failure to strengthen internal controls and a lack of skilled officials.
The overreliance on consultants remained a concern.
“This is unacceptable, we are asking the MECs to oversee that councils institute disciplinary action against negligent and underperforming officials.
“If need be, we will refer some municipalities to the relevant political parties to consider a change in the leadership of these municipalities if there is no immediate improvement.”
The Minister also said underperformance was sometimes due to the fact that those in leadership positions, like municipal managers, were reluctant to act against maladministration.
Some officials often sit with a forensic report on their desks without taking action despite the seriousness of the findings of the fact that a lot of money was spent to appoint the firm that conducted the investigation.
Competency under the microscope
Minister Gordhan said as part of “Back to Basics”, his department would redouble its efforts to ensure that challenges of incompetence are addressed.
These would include, amongst others, implementing audit response plans to address issues raised by the Auditor General and ensuring the appointment of competent senior management.
“Candidates who do not meet minimum competency requirements are not endorsed by MECs.
“Thus far, MECs have launched five court applications for orders to nullify the appointments of the municipal managers without the necessary qualifications,” he said. – SAnews.gov.za
