LATEST AUDITOR GENERAL REPORT ON OUR MUNICIPALITIES MAKES A DEPRESSING READ

Comment by :Pastor Ray McCauley ( 30 June 2019 )

The one good thing emerging from the Auditor General’s report on municipalities is the independence of the office of the Auditor General. As citizens, we rely on the Auditor General to provide us with assurances that government activities are carried out and accounted for in accordance with budget allocations and the law in general.
It is a role that requires independence and competence. The current incumbent, Kimi Makwetu (supported by his staff), has demonstrated these qualities, though they face threats and intimidation they do their work without fear or favour .

His independence has been assured by the reaction of political parties to the report on municipalities which he recently released. All have welcomed his report in spite of the unflattering picture it paints of the municipalities they run. But the reaction by political parties and society in general must go beyond just ‘welcoming’ the report. With 92 percent of municipalities, including the metros, failing to receive clean audits, citizens would be forgiven to conclude that they are faced with a perpetual incompetence machine. We have gone beyond the point of crisis if the Auditor General`s report is anything to go by . The time for talking and making promises to fix these municiplities is over and we are at tipping point if our Government doesn’t take immediate action .

The latest audits carried out on local government by the Auditor-General makes depressing reading and it paints a bleak picture of the ongoing system failure and dysfunctionality of most municipalities. The majority of municipalities are in a state of collapse, with many flouting good governance practices and law, disregarding recommendations made by the Auditor General. Auditor-General Kimi Makwetu has expressed great concern and disappointment over the financial health of municipalities in the country. Announcing the 2017/18 municipal audit results on Wednesday 26 June 2019 in Pretoria, he said:
“This undesirable state of deteriorating audit outcomes shows that various local government role players have been slow in implementing, and in many instances even disregarded, the audit office recommendations”.
Makwetu said his team of auditors had faced threats and that the audit environment had become more “hostile, with increased contestation of audit findings and pushbacks whereby our audit processes and the motives of our audit teams were questioned”. His auditors were pressurised to change their findings in some municipalities, to hide negative reports and irregular expenditure.

“Instances of threats to and intimidation of our auditors were also experienced in most of the provinces,” Makwetu said.
The consolidated audit report indicates that of the 257 municipalities audited for the 2017/18 financial year, only 18 received clean audits, a regression from the 33 municipalities that had received a clean audit in the previous year. A total of 63 municipalities worsened, with only 22 showing improvement.

Twelve of the 18 clean audits were in the Western Cape, two in the Eastern Cape and one each in the Northern Cape, Gauteng, KwaZulu-Natal and Mpumalanga. Limpopo, North West and Free State had no clean audits.
The situation in the Free State, in particular, was of “critical concern”:
“The Free State local government environment displayed a total breakdown in internal controls as the province’s political and administrative leadership, yet again, exhibited no response to improve its accountability for financial and performance management… we doubt if there is political will to do the right thing for the right reason, mainly due to political interference to the detriment of good governance.”

The Auditor-General attributed the dismal national picture to a lack of accountability and municipalities’ inadequate attempts to follow up on allegations of financial or “supply chain management” misconduct and fraud.
Not only are municipalities across the nation continually ignoring audit recommendations, but they are also not complying with key local government legislation that is applicable to financial and management performance. According to the consolidated audit, material non-compliance is likely to result in financial loss or the harm of a public-sector body and the general public. Material non-compliance is at a record high since 2011/12.
The Auditor-General further reported that 92% of municipalities did not comply with legislation: Common areas for non-compliance are management and procurement of contracts, which often involve suppliers not indicating a conflict of interests and the absence of competitive bidding.

The above suggests one thing: the municipal sphere of government is facing a crisis and government should be putting out an SOS that things are really bad. We have seen too much indifference to the problems which we face as a country and one hopes that the powers that be are not oblivious to the magnitude of the problem. But what is it that we are dealing with at local government level?

While we welcome President Cyril Ramaphosa`s commitment in his State of the Nation address to resolve this crisis, it appears that the situation is worsening with each passing day and it will require an urgent collective and political will to turn it around

For me, the first and fundamental solution revolves around the political will to tackle this problem. Many promises to turn around local government have been made. Why have they not yielded results? They will not, for as long as the political will or support to bring about change is lacking. We need enough support from political leaders in order to bring about and sustain the change necessary in that kind of situation, especially given the near-certainty that counter-reform efforts will be launched once vested interests are threatened. In situations where these vested interests involve politicians, can society count on the existence of a political will to tackle corruption in local government?

The second solution revolves around bringing together civil society and the private sector to address problems that government is unable to solve alone. Rather than seeing citizens and civil society groups as competitors, municipalities and government in general must see the private sector, civil society and non-profit organizations as essential partners in solving complex social problems.

This requires a new social contract which puts citizens at the centre of the development and governance framework. Where both civil society and the private sector are involved in the governance of their municipalities. The days of ‘vending machine municipalities’ where residents pay taxes and municipalities solve their problems are gone. Municipal authorities must realize that their own people can be partners in governance. In every municipal area, there must be an accountant, engineer or professionals in diverse disciplines who would happily volunteer by assisting their municipality with budgets, contracts or whatever skill may be required.

Thirdly, it is obvious that there is a lack of necessary skills within our municipalities. Recognizing the complexity involved in providing citizens with the services required on a day-to-day basis, there is a clear case for developing professional management capacity at local government level. Engaging skilled people to run our municipalities is of paramount importance.

Lastly, in order to deliver public services effectively and efficiently our municipalities need professionals who will bring to the communities they serve technical knowledge, academic training, management expertise, and a dedication to public service.

PASTOR RAY McCAULEY IS PRESIDENT OF RHEMA FAMILY CHURCHES AND CO-CHAIRPERSON OF THE NATIONAL RELIGIOUS LEADERS COUNCIL (NRLC)

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