Financial state of municipalities has worsened — AG

The financial state of municipalities across the country continues to worsen said Auditor General (AG) Kimi Makwetu on Wednesday. He was speaking at a media briefing on the release of the 2017-2018 financial year general report on the audit results of municipalities.

“Audit results show an overall decline… this undesirable state of deteriorating audit outcomes shows that various local government role players have been slow in implementing, and in many instances, even disregarded the audit offices recommendations,” Makwetu said.

A total of 257 municipalities were audited. The number of clean audits in municipalities declined from 14% in the previous financial year to 8%. Only 18 municipalities had a clean audit with the highest number, 12, being in the Western Cape. Gauteng, Mpumalanga, Kwazulu-Natal and the Northern Cape each have one municipality with a clean audit. The Eastern Cape had two.

“We have consistently cautioned those charged with oversight and governance about administrative lapses that could cripple local government and its ability to deliver services to the citizenry,” Makwetu said.

The irregular expenditure in municipalities amounted to R21.2-billion, an improvement from the 2016-2017 year where irregular expenditure was R27.7-billion.

Before going into the details of the report, Makwetu emphasised that the outcomes of the report were compiled before the Public Audit Amendment Act was signed into law in November 2018. This audit report was compiled for the financial year ending June 2018.

The groundbreaking legislation gives the AG new powers to act on corruption and the abuse of public money so going forward, the AG’s office will have the ability to issue binding recommendations audits conducted on or after March 31 2019.

The new Act gives the AG the authority to refer irregular materials to relevant public bodies for investigation, take binding remedial action for municipalities that fail to implement audit recommendations and issue a debt certificate where recommendations were not implemented and a financial loss was incurred.

READ MORE: After years of barking, the AG gets teeth

Makwetu also raised concerns about the challenges that auditing teams face when they conduct their work.

“The audit environment became more hostile with increased contestation of audit findings and pushbacks whereby our audit processes and the motives of our audit teams were questioned. Instances of threats to and intimidation of our auditors were also experienced in most of the provinces,” he explained.

According to Makwetu, major reasons for the outcomes of this report are that many municipalities have vacancies and instabilities in key positions and the leadership of municipalities were unable to instil discipline and implement corrective action against officials flouting processes. 

Read the full report here:

Integrated Annual Report 2017-18 Annual Report by Mail and Guardian on Scribd

These are unprecedented times, and the role of media to tell and record the story of South Africa as it develops is more important than ever. But it comes at a cost. Advertisers are cancelling campaigns, and our live events have come to an abrupt halt. Our income has been slashed.

The Mail & Guardian is a proud news publisher with roots stretching back 35 years. We’ve survived thanks to the support of our readers, we will need you to help us get through this.

To help us ensure another 35 future years of fiercely independent journalism, please subscribe.


Stella set to retain her perks

Communication minister will keep Cabinet perks during her two months of special leave

Not a sweet deal, Mister

Mister Sweet workers say they will not risk their health, and the lives of others, to continue producing and packaging confectionaries

Covid-19 grounds Nigeria’s medical tourists

The country’s elites, including the president, travelled abroad for treatment but now they must use the country’s neglected health system

Nehawu launches urgent court bid over protective gear for health...

The health workers’ union says the government has rebuffed its attempts to meet about mitigating risks to workers

Press Releases

Rahima Moosa Hospital nursing college introduces no-touch facial recognition access system

The new system allows the hospital to enrol people’s faces immediately, using artificial intelligence, and integrates easily with existing access control infrastructure, including card readers and biometrics

Everyone’s talking about it. Even Kentucky

Earlier this year South African fried chicken fast-food chain, Chicken Licken®, launched a campaign for their wallet-friendly EasyBucks® meals, based on the idea of ‘Everyone’s talking about it.’

New energy mix on the cards

REI4P already has and will continue to yield thousands of employment opportunities

The online value of executive education in a Covid-19 world

Executive education courses further develop the skills of leaders in the workplace

Sisa Ntshona urges everyone to stay home, and consider travelling later

Sisa Ntshona has urged everyone to limit their movements in line with government’s request

SAB Zenzele’s special AGM postponed until further notice

An arrangement has been announced for shareholders and retailers to receive a 77.5% cash payout

20th Edition of the National Teaching Awards

Teachers are seldom recognised but they are indispensable to the country's education system

Awards affirm the vital work that teachers do

Government is committed to empowering South Africa’s teachers with skills, knowledge and techniques for a changing world