This year’s Auditor General report on municipalities was kinder to Madibeng Municipality compared to previous years. Madibeng has improved and moved from a disclaimed audit opinion to an adverse opinion for the first time in six years.

Auditor-General Tsakani Maluleke

The Auditor-General (AG) tabled the Consolidated General Report on Local Government Audit Outcomes in Parliament last week. An adverse opinion indicates financial statements contain material misstatements and possible fraud.

“There is little transparency or accountability in how these municipalities use their funds,” Auditor-General (AG) Tsakani Maluleke said. “As with municipalities that receive disclaimed audit opinions, national and provincial leadership and coordinating institutions should offer support and, where necessary, intervene.” The municipalities that received adverse audit opinions are under provincial intervention.
The AG said Madibeng was guilty of poor environmental practices. “During our site visit to the Brits wastewater treatment works in Madibeng, the plant was not functioning effectively because its disinfection and retention channels were not working. These channels are used to remove chemicals before the wastewater is spilled back into the river. This has resulted in non-compliant waste being discharged into the Crocodile River, causing pollution and significant harm to the environment.” Non-compliant wastewater is discharged into the Crocodile River.
According to the report, Madibeng’s pollution of water resources, resulting in harm to the public, was referred to the Department of Water and Sanitation in June last year. An investigation is in progress.
Maluleke said material irregularities relating to non-compliance and possible fraud in the province, have resulted in a financial loss of R1,10 billion as well as substantial harm to the public and municipalities. “For example, we issued material irregularity notifications to the municipal managers of Madibeng and Rustenburg local municipalities because of payments totalling R19,68 million into private accounts (pointing to possible fraud), and payments of R33,22 million to a supplier for work on the rapid transport project that was not performed, respectively. We have also referred eight material irregularities relating to substantial harm to the public to other public bodies for further investigation. Councils should regularly follow up on material irregularities reported to them and take resolutions for accounting officers to act on the outcomes of completed investigations. Audit committees should establish a clear reporting mechanism for material irregularities and foster a reporting culture that enhances transparency and encourages early detection and intervention.”
She said Madibeng was one of the municipalities that did not take remedial action to resolve material irregularities as the AG’s recommendations were not implemented. Madibeng did not keep full and proper records in 2019-2020, causing substantial loss to the municipality and remedial action recommended by the AG was not implemented.