LISTICLE | Local Government Summit: General status of municipalities in the country

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The Ministry of Cooperative Governance and Traditional Affairs (COGTA), under the leadership of Minister Dr Nkosazana Dlamini-Zuma, is hosting a Local Government Summit at the Birchwood Conference Centre on the East Rand from Tuesday to Wednesday.

The theme of the conference is “District Development Model in Action – towards an ideal municipality”.

In attendance will be President Cyril Ramaphosa, Finance Minister Enoch Godongwana, Water and Sanitation Minister Senzo Mchunu, Auditor-General Tsakani Maluleleke, a delegation from the House of Traditional Leaders and representatives from the private sector.

The conference happens during a time when municipal finances are reported to be under severe pressure as corruption, maladministration and fruitless and wasteful expenditure take hold.

Below is the general status of municipalities in the country:

Auditor General Report 2020/2021

* The Auditor General Report for 2020/2021 confirmed that 28% of municipalities were in a dire state, with financial collapse imminent.

* Financial health of 230 municipalities and 18 municipal entities based on their financial statements revealed increasing indicators of a collapse in finances.

*41 municipalities received clean audit results out of 257 100 unqualified audits, 78 qualified audits, 4 adverse findings and 1 Outstanding audit.

* At least 70% of the municipalities used consultants for their reporting every financial year and they were paid R1.26 billion.

Coalition governments

*Following the results of the 2021 Local Government Elections, 70 municipalities did not have an outright winner, which meant that more councils would have multi-party coalition governments;

* There are eight metropolitan municipalities in the country, of which five are currently under the coalition government.

*In Nelson Mandela Bay in the Eastern Cape, ANC mayor Eugene Johnson,  who was supported by smaller parties against the DA and EFF was removed during an overnight vote of no-confidence last week.

* In the City of Johannesburg, the removal of DA speaker Vasco Da Gama is viewed as a precursor to the removal of DA mayor Mpho Phalatse.

Municipal debt and expenditure

*Municipal debt to Eskom stood at R49.1 billion, as of August 2022.

*Some Eskom debt defaulters include Maluti-A-Phofung municipality  at R6.5 billion, eMfuleni municipality  at R3.5 billion and Merafong municipality  at R570 million amongst others;

* Soweto residents owe the power utility R5 billion.

VIDEO: SABC Specialist Researcher Maswele Ralebona explains further: