5 April 2012 – Recommendations to help the City of Johannesburg better manage its finances and improve service delivery have been tabled by the Municipal Public Accounts Committee (MPAC). This was revealed on Wednesday at a press briefing hosted by the committee to give an update on the city’s finances.
Committee chair Scelo Gcabashe’s most shocking revelation, however, was the amount, in arrears, that councillors owe the city.
“Arrears by councillors outstanding for more than 90 days amounting to R1-million were reported for the 2010/11 financial year,” he said.
Gcabashe added that of this amount, R301 084 was owed to the municipality by one councillor.
The MPAC performs a watchdog function over legal and policy compliance and service delivery in the Johannesburg.
Established in 2007, its focus is on the municipality’s financial governance, including its entities.
The findings by the committee were derived from the municipality’s annual report of 2010/11 and were tabled and adopted by the council at its last meeting.
Pointing out various issues, Gcabashe said the municipality’s supply chain management (SCM) needed urgent intervention as it could compromise good governance.
“The fact that the City is able to do business with its own staff is due to SCM weaknesses,” he said.
Delays in paying service providers were also blamed on the poor SCM, while the high number of irregularities was also a cause for concern.
In total, the committee found 49 irregular expenditures.
Gcabashe recommended that credit control policies be attended to soon in order to minimise outstanding debts and increase revenue.
“The MPAC has vowed to uphold the principles of good governance by ensuring transparency, accountability and value for money when it comes to utilisation of City funds,” he said, adding that the committee was committed to helping Johannesburg achieve the national initiative of Operation Clean Audits 2014.
In drawing up its report, the committee consulted various stakeholders, including the office of the auditor general, the city manager and section 79 committees to collect information and seek clarity. It also sought public comment.
The much-discussed billing crisis was also on the list of issues it researched.
“On the billing system, the customers must receive accurate bills to eliminate queries,” said Gcabashe.
A municipal information management system was deemed vital to ensure that records were up to date and readily available when they were needed.
“Rendering quality services is hindered by individuals who manipulate the system for their own selfish reasons and gains,” he said.
The council was expected to implement corrective measures as recommended by the committee to ensure that the issues did not recur. Furthermore, the committee would meet heads of departments at a monitoring meeting later this year.
On the matter of the councillors who have not paid their bills, Gcabashe said would approach the Office of the Chief Whip to plan a way to collect this revenue.
The issues that led to the qualified report of 2010/11 were related to, but differed, from those in the previous financial years, Gcabashe noted. This meant that the municipality had improved.
The MPAC recommendations to the city were:
• The executive mayor should take all reasonable steps to ensure annual reports tabled before the council are complete and final documents.
• The accounting officer must comply with the auditor-general’s time frames.
• The accounting officer must report quarterly to the MPAC on actions taken to ensure that the City met the national target of Operation Clean Audit.
• The accounting officer must report bi-monthly to the MPAC progress made in the implementation of the billing roadmap.
• City Power must submit a report providing a breakdown of contributing factors leading to electricity loss by the MPAC meeting of April 2012.
• The accounting officer must submit a report to the MPAC meeting of May 2012 explaining the gross loss of R66 938 000.
• The Johannesburg risk and audit services must institute an investigation into the Johannesburg Social Housing Company regarding R575 000 spent on evicting four defaulters.
• The accounting officer must submit a report on employees identified to have contravened regulations 13 and 14 of the SCM regulations. and,
• The accounting officer must submit to the MPAC clear measures across departments to ensure compliance with section 65(2)(e) of the Municipal Finance Management Act.