Lack of accountability and consequence management plagues local government

This story is sponsored

The 2019-20 local government general report released by the Auditor-General of South Africa (AGSA) on 15 June continues to emphasise the lack of accountability and consequence management in local government that impacts service delivery and municipal finance management.

Despite there being a decrease in unauthorised, irregular, and fruitless and wasteful (UIFW) expenditure in 2020-21, very little steps have been taken by municipalities to enforce accountability and consequence management. 

The Municipal Finance Management Act (MFMA) requires councils to investigate all UIFW expenditure. Furthermore, municipalities are required to recover the UIFW expenditure from the responsible person. As indicated by the AGSA, 51% of municipalities did not investigate the previous year’s irregular expenditure, 42% did not do so for unauthorised expenditure, and 41% failed to do so for fruitless and wasteful expenditure.

In addition, during 2020-21, very little was done by councils on the 2019-20 irregular expenditure year-end balance of R110.18-billion. Councils had recovered or were in the process of recovering R0.1-billion (<1%) of money, condoned R0.1-billion (<1%) of UIFW expenditure, written off R12.21-billion (11%) of UIFW expenditure and had not dealt with an astonishing R97.96-billion (89%) of UIFW expenditure. 

The AGSA also audited 78 municipalities where there were allegations of financial and supply chain misconduct and fraud to confirm whether there was any accountability, and found the following:

  • At 51% of municipalities, investigations took longer than three months to complete.
  • At 14% of municipalities, allegations were not investigated.
  • At 5% of municipalities, sanctions were not imposed, or recommendations were not implemented based on completed investigations.

In 2019-20 the AGSA further reported on 128 possible fraud or improper conduct incidents in supply chain management processes and recommended that management further investigate these matters. The status of the investigations into fraud and improper conduct in supply chain management processes highlighted that only 45 (35%) of municipalities investigated all the findings reported, 16 (13%) municipalities investigated some of the findings reported and 67 (52%) municipalities investigated none of the findings reported.

The lack of consequence management highlighted undermines the prescripts of the MFMA and Constitution. It further diminishes the impact that funds allocated to service delivery have, and impacts on economic growth. 

SAICA urges councils and portfolio committees to exercise their powers to hold municipalities accountable and to enforce consequence management to improve service delivery and municipal finance management.

Natashia Soopal is Executive: Ethics and Public Sector at SAICA


The South African Institute of Chartered Accountants (SAICA), South Africa’s pre-eminent accountancy body, is widely recognised as one of the world’s leading accounting institutes. The Institute provides a wide range of support services to more than 50 000 members and associates who are chartered accountants (CAs[SA]), as well as associate general accountants (AGAs[SA]) and accounting technicians (ATs[SA]), who hold positions as CEOs, MDs, board directors, business owners, chief financial officers, auditors and leaders in every sphere of commerce and industry, and who play a significant role in the nation’s highly dynamic business sector and economic development.

Chartered Accountants are highly valued for their versatile skill set and creative lateral thinking, that’s why all of the top 100 Global Brands employ Chartered Accountants.

For more information, visit:

email: [email protected]

About Mail & Guardian Sponsored Stories

The Mail & Guardian’s sponsored stories are produced in association with paying partners. If you would like to speak to our team about producing and publishing high quality content on our site, please contact us at this email address.

Related stories

Your M&G

Hi , To manage your account please click here.

You can access your digital copy of this week’s paper here.


Today's top stories

Mkhwebane would not hear of Gupta links to Estina: witness

The suspended public protector told him she would pleased if the probe into the scam delivered no adverse findings, Reginald Ndou tells inquiry

Editorial: The ANC won’t listen to its own conscience, the...

The party’s top officials seem to have no real inclination to follow through with the integrity commission’s recommendations on corruption

Nxesi: The changing definition of work demands a review of...

The labour minister noted many informal workers had been excluded from the country’s Covid-19 relief scheme

Tazné van Wyk murder accused admits to absconding parole

Moyhdian Pangkaeker evaded the justice system for about four years during which time he twice absconded while on parole. He faces 27 charges, 24 of which he allegedly committed while on parole.

Gallery: Marikana remembers a tragedy

Images from the 10th Marikana Massacre commemoration

press releases

Loading latest Press Releases…