/ 13 September 2019

Hawk eyes for municipal crimes

This week
This week, municipalities from the North West and Limpopo provinces were hauled before Parliament’s financial watchdog to explain their disastrous financial positions. (David Harrison/M&G)



‘Where are the Hawks?” MPs sitting on the standing committee on public accounts (Scopa) asked after hearing two days of exhaustive testimony about the precarious state of the country’s municipalities.

This week, municipalities from the North West and Limpopo provinces were hauled before Parliament’s financial watchdog to explain their disastrous financial positions.

A report by the auditor general said most municipalities, which are supposed to be on the front line of service delivery, were in financial difficulty. During the 2017-2018 financial year, 257 municipalities were audited and only 18 received clean audits. And there had been R25-billion in irregular expenditure of taxpayers’ money.

The municipalities spoke of problems ranging from parallel unofficial administrations making decisions on procurement and tenders to the inability to fill key vacancies and residents not paying their utility bills.

Among those called to answer was the Vhembe district municipality. It had illegally invested R300-million in the now-defunct VBS Mutual Bank. The municipality admitted that no senior officials were fired for the illegal investment and that the municipal manager and chief financial officer resigned after reaching a settlement with the local government.

Other municipalities reported racking up hundreds of millions of rand in debt and wasteful expenditure.

The Thabazimbi municipality told MPs it had obtained adverse financial audit findings every year since 2013. The municipality also owed Eskom almost R200-million and blamed this on residents who have not paid their electricity bills.

The Mopani municipality was slammed for paying consultants as much as R24-million. Municipal officials said they did not have enough staff and that some departments only had interns.

Scopa’s chairperson, Mkhuleko Hlengwa of the Inkatha Freedom Party, asked why some municipalities were placed under administration by the department of co-operative governance and traditional affairs (Cogta) and others were not.

“We have this ‘hamba kahle’ approach in the time of crisis. You’ve got municipalities who don’t have these adverse findings as what we are seeing here. But when one of their mayors sneezes and then suddenly administration under section 139 is there,” Hlengwa said.

Section 139 of the Constitution provides that when a municipality is unable to function, it can be put under administration by the provincial government.

“We have the auditor general saying councils were not meeting. There are clear adverse findings, intimidation of auditors, parallel reporting structures. You have got municipalities run by two directors, one of them is a traffic manager, and yet Cogta’s response is, ‘Well, there was a [financial assistance] package’,” said Hlengwa.

ANC MP Nokuzola Tolashe said it was no wonder people were protesting. “Monies are being spent, big committees are sitting fraudulently. It means tenders are being received fraudulently.”

MPs say they want law enforcement agencies and the Hawks to tell them whether there are any criminal investigations into perpetually failing municipalities and whether any criminality is being probed.

“All is not well. That is fundamentally clear … because corruption thrives when you make a conducive environment for it,” Hlengwa added.