The Democratic Alliance (DA) in the Eastern Cape has asked the MEC for Cooperative Governance and Traditional Affairs (CoGTA), Xolile Nqatha to appoint a special task team to investigate the financial matters of at least 14 municipalities in distress in the Eastern Cape.
The bankrupt Amathole District Municipality (ADM) announced that it is unable to pay staff and creditors for the next four months.
This has had a severe impact on service delivery.
Amathole District Municipality is seeking assistance from provincial and national government:
DA provincial leader, Nqaba Bhanga says bailouts are not the solution.
“We must ensure that municipalities are working within an approved organogram to reduce the cost of employment and ensure that municipalities employ qualified people. To save our municipalities, we must stop cadre employment. We must make sure we appoint capable individuals who can turn around the problem, regardless of their skin colour. The Eastern Cape needs an intervention now!”
The DA believes the financial situation of the Amathole District is far worse, with 29 of the 39 municipalities in hot water.
“The AG is of the opinion that 83% of municipalities in the Eastern Cape are facing significant cash-flow restraints and the expenses of 38% of municipalities exceed their revenue. Bloated staff compliments of local authorities with the cost of employment in the majority of Eastern Cape Municipalities far above the National Treasury norm. This is evident from the latest report that the now-bankrupt Amathole District Municipality employed in the vicinity of 900 people that were not needed,” says the DA Member of the Provincial Legislature in the Eastern Cape Vicky Knoetze.
Some organisations are calling for the municipality to be placed under administration: