Political parties and Unions have come out guns blazing, voicing their concerns after the Auditor General Tsakani Maluleke tabled the Local government audit outcomes for the year 2023/2024 this week.
Maluleke briefed the Portfolio Committee on Cooperative Governance and Traditional Affairs (COGTA), revealing disturbing issues related to financial management, service delivery, and governance across many of SA’s municipalities.
In a formal tabling of the annual consolidated general report on the audit outcomes for local government, Maluleke painted a bleak picture saying that there had been little change on the improvement in the government of SA’s municipalities.
According to the AG, an overwhelming number of municipalities continue to struggle with poor financial management practices.
Her findings indicate that 110 municipalities collectively incurred R27.3 billion in fruitless and wasteful expenditure.
She further revealed that only 38 municipalities receive clean audits for the 2022-23 financial year.
Independent media reported this week that Maluleke said the trend of poor audit outcomes in local government continued, with only 34 (13%) of municipalities obtaining clean audits.
“Meaningful improvement over the term of the new administration was not evident, while 45 municipalities have improved their audit outcomes since 2020-21, 36 have regressed,” Maluleke she said.
“The most prevalent audit outcome was an unqualified audit opinion on the financial statements with findings on performance reporting and/or compliance with key legislation at 43% of municipalities. These municipalities had made little effort to move out of this category, with 77 remaining there since the end of the previous administration’s term,” she added.
However political parties and unions have voiced their dissatisfaction with the audit outcomes saying they were alarmed by the report
To fire the first salvo was the South African Municipal Workers’ Union (SAMWU) saying they were “gravely” concerned by the Municipal Finance Management Act (MFMA) audit outcomes.
“The AG’s findings on service delivery are equally troubling. It highlights that many municipalities are unable to provide consistent and reliable services to their communities, largely due to inadequate financial management and infrastructure investment…This lack of investment in critical infrastructure is directly linked to the financial mismanagement highlighted in the report, as funds that could be used for infrastructure development are often wasted or misallocated,” SAMWU’S general secretary Dumisane Magagula said.
“These audit outcomes raise serious concerns about the state of governance and accountability within the local government sector. A total of 87 municipalities have vacant senior management positions, including Chief Financial Officers (CFOs) and Municipal Managers, which are critical for effective financial oversight and decision-making. The lack of permanent leadership in these roles has led to a breakdown in financial governance, with many municipalities failing to implement basic internal controls or follow up on audit findings from previous years,” Magagula added.
He further called for “urgent” and “decisive” action to address the financial, governance, and service delivery challenges facing the country’s municipalities.
“The Union urges the national and provincial governments to strengthen oversight and support mechanisms for municipalities, particularly those that are struggling to comply with the MFMA,” he said.
In a statement released this week, the EFF mirrored SAMWU’s concerns saying local government needed a complete overhaul.
“We note the audit outcome report demonstrates that there is very little attention paid to credible reporting on municipal performance. This is made worse by the lack of transparency and accountability which leads to poor service delivery and corruption.
“The EFF further notes that the report by the AGSA makes it clear that local government is losing billions of rands each year because of poor decisions, neglect, and corruption. Fruitless expenditure increased from R4.8 billion to R7.4 billion in 2022-23, as irregular expenditure continues to be prevalent in local government because of poor systems, despite continued reports by AGSA,” the statement read.
The party further said they would direct all its caucuses to study the full AGSA local government audit outcome report and develop a clear, practical, and credible plan to ensure all recommendations in the report are implemented.
Saturday Star