Two of the North West province’s most troubled municipalities played host to Parliament in August, when the National Council of Provinces’ (NCOP) select committee on Co-operative Governance and Traditional Affairs descended on Ventersdorp and Tswaing municipalities for oversight visits. The municipalities were among those placed under provincial administration in May following cases of serious maladministration and poor financial management that have persisted over years.
The next step is for the committee to advise the NCOP on how to proceed with the application by the province to invoke Section 139 (1) (b) of the Constitution on these two municipalities. This section provides for a provincial executive to assume responsibility for the relevant obligation in that municipality, to the extent necessary, by:
- maintaining essential national standards or meeting established minimum standards for the rendering of a service;
- preventing the municipal council from taking unreasonable action that is prejudicial to the interests of another municipality or to the province as a whole; or
- maintaining economic unity.
Housing and local government MEC Collen Maine said the department has seconded senior managers from the provincial government to act as municipal manager and administrator at each of the municipalities, to help improve service delivery and financial controls in the municipalities, among other objectives.
At the time of the announcement of the intervention in May, the spokesperson in Maine’s department, Ben Bole, said: “The administrators, supported by a team of experts, will implement the interventions in both Ventersdorp and Tswaing local municipalities … for a … minimum period of six months.”
Maine highlighted the successes of the intervention by saying that to date, both the integrated development plan and budget for 2015/16 have been tabled before council. The annual oversight report for 2013/14 is also ready for tabling, while an audit committee has been established, although it is shared with Dr Kenneth Kaunda district municipality. Another achievement is that senior municipal officials have been able to sign performance agreements and the service delivery and budget implementation plan has already been approved for implementation.
“The decision to put the municipality under Section 139 was taken in April this year by the provincial cabinet and is said to be based on the need to rid the municipalities of challenges such as poor administrative leadership, poor financial management and poor labour relations,” read a statement by Parliament.
Province of disclaimers
Not a single one of the North West’s 23 municipalities received a clean audit in the 2013/14 financial year. About a third of these received disclaimer notices from auditor-general Kimi Makwetu, who highlighted poor financial management, irregular expenditure and lack of accountability for resources as key factors leading to the poor performances.
Earlier in the year, the provincial legislature announced that Ngaka Modiri Molema district municipality and two others would be placed under provincial administration in an effort to restore healthy management of services.
“It is encouraging to note that the province has been largely successful in sustaining its ability to submit financial statements within the legislated deadline,” Makwetu noted in his report on the province in June. “However, the quality of these financial statements and performance reports is still below the required standards.
“Accurate and reliable reporting of financial information in a transparent manner is still a major concern in most municipalities, in particular those with repeat disclaimers in the last five years.”
Ventersdorp and Tswaing are among those repeat offenders, having received disclaimers every year since 2009/10, while Rustenburg got three qualified opinions, followed by a disclaimer in the previous financial year (2012/13) before going back to qualified opinion this year.
Makwethu cites a challenge in the financial sustainability of most of the province’s municipalities. “The majority of municipalities in the province are in constrained financial positions with no ability to service their financial obligations due to poor collection of consumer debt.”
This, he says, compromises delivery of basic services.