OUTA CEO Wayne Duvenage recently hosted a webinar that focused on our failing municipalities and solutions to their decline, Saving South Africa’s Municipalities. Guests in the discussion were Auditor-General Kimi Makwetu and Senior Researcher at the Public Affairs Research Institute Dr Tracy Ledger. 

The AG’s recently released report on the municipalities’ 2018/19 audit outcomes, which underlined the seriousness of municipalities’ deterioration, set the scene:

• Of 257 municipalities audited, only 20 (being 8%) received a clean audit;

• Of the 229 completed audits, the AG found R2.07-billion in fruitless and wasteful expenditure, almost R12-billion in unauthorised spending and 34% of municipalities ended the year in deficit;

• The number of municipalities incurring irregular expenditure increased from 239 to 241; and

• Annual irregular expenditure had increased to R32.06-billion.
  
  

“Municipalities are crippled by debt,” said Makwetu. “They are unable to pay for services, and the debt situation is exacerbated by countless unpaid bills – ratepayers owed municipalities R180-billion by March this year.”

Asked to consider the root cause of the decline in local government, the AG placed blame on three factors: systems in place meant to protect capital are “chaotic”; a “glaring absence of skilled persons”, notably in infrastructure delivery and finance (municipalities spent R1.26-billion on financial consultants); and a lack of accountability, which compounds the negative impact of other factors. 

Stressed Makwetu, “[T]his creates a fertile ground for corruption.” Duvenage said that the public may soon see the accountability they crave: through the amended Public Audit Act, the AG’s office can now go after those responsible for irregular, unauthorised and wasteful expenditure in their personal capacity. 

Ledger believes the root cause is structural. All rogue municipalities lack basic administration and filing systems, while fewer than half comply with mandatory management and financial frameworks. But she asserted that South Africa already has a solution to the nationwide problem of failing municipalities – section 139 of the Constitution empowers provincial and national government to intervene in dysfunctional municipalities through any number of measures.

A CLEAN AUDIT IS THE BASIC STANDARD

Considering alternative answers, the AG stressed the need to restore the authority of municipal managers and the council chamber through departmental control frameworks, such as quarterly progress reports. “A clean audit should be the basic standard, the starting point – not something to aspire to.”

Ledger maintained that struggling municipalities will start to improve when they engage with the people they serve. “There’s a reluctance to take communities into confidence, especially regarding budget and real community needs.” She contended that citizens must know and practice their constitutional rights, which includes the right to be informed of and consulted on municipal budgets. 

The revival of South Africa’s local government requires a multifaceted approach. Government employees must work with citizens to find and implement solutions – civil society is not their enemy. In turn, citizens must exercise their rights whenever the opportunity arises and hold those in power to account. We all want the same thing: a corruption-free government that efficiently serves its people.