The Madibeng municipality is “stubborn and continue to obtain disclaimed audit opinions”, the Portfolio Committee on Cooperative Governance and Traditional Affairs (CoGTA) told parliament after it had engaged with Madibeng earlier in May on the state of service delivery.
The engagement follows a previous meeting of the committee and Parliament’s Standing Committee on Accounts (Scopa) with Bojanala Platinum District Municipality and Madibeng Local Municipality.
“Notwithstanding these appearances, the two municipalities remain stubborn and continue to obtain disclaimed audit opinions for more than five consecutive years. There is no indication that these appearances were taken serious as there is no change in the audit outcomes,” chairperson of the committee, Faith Muthambi, said.
In its meeting with Madibeng Municipality in August 2020, the committee highlighted its concerns around the entrenched pattern of consecutive disclaimed audit opinions dating back to 2015/16 financial year. The municipality’s presentation indicated that it had addressed only 39 percent of the 197 audit findings in respect of the 2018/19 disclaimed opinion. The committee did not accept that.
The committee has noted the deterioration of the municipality’s financial situation after the municipality had invested R31.5 million in VBS Mutual Bank, an amount of money which was written off by the council as a financial loss. The committee noted that consequence management in relation to this matter has not been satisfactory. Another concern which the committee expressed related to payments to consultants that were more than what the municipality had in its purse.
The committee was informed that the municipality had been under administration four times according to Section 139(1) (b) of the Constitution, but all those interventions didn’t produce the desired results. For example, the municipality is still among those identified as the most distressed in the province despite these successive interventions.
One of the resolutions of the meeting which was held in August 2020 with Madibeng Municipality, was that the provincial Department of Cooperative Governance, Human Settlements and Traditional Affairs, must furnish the committee with a list of performance contracts of the administrators that served in Madibeng Local Municipality, as well as consequences that were applied against those that did not perform adequately.
The committee requested this report after it realised that the administrators were part of the problem. Also, the committee has not received this report and has requested an explanation for that failure.
The committee said that the Madibeng Local Municipality has serious underlying challenges that will take a long time to be alleviated. The committee told the leaders and managers of the municipality that the most serious of all, is that the leadership of the municipality has lost the trust of the community. The committee told the municipality to regain that trust and do so as soon as possible.