Service delivery projects in the Giyani area of Limpopo have been affected by the municipality’s investment in the troubled VBS mutual bank.
The municipality has invested R161 million. Most people have expressed disappointment.
The Giyani municipality is facing financial constraints due to its investment in VBS. The municipality doesn’t generate much revenue.
Most residents in the area are indigents. In the Giyani CBD – the streets have potholes. The situation is worse in the deep rural villages.
Residents say the money invested in VBS could have been used to accelerate services.
“I’m very disappointed by the Giyani municipality’s investment because they were not focusing on the development of infrastructure, the roads, so we’re very disappointed about that.”
“We have no water, we have no clinics, so I don’t feel good at municipality. I really feel that the law will take its course and all the perpetrators be taken to court and we’re not receiving water and I believe that this thing which happened is the cause of the situation now.”
The newly Giyani municipal manager, Maxwell Chauke, stopped the municipality from making further investment.
Chauke says the municipal coffers weren’t pleasing when he assumed duty in January this year. Chauke says there were financial irregularities and disregard for public funds.
“There were some monies that were invested with VBS that I made some inroads to find out the processes that were followed in terms of doing that investment whether they were in line with Municipal Finance Management Act and that I found that it was not aligned. Upon the evaluation I found that in terms of the VBS investment there were some irregularities that were done in terms of officials within the institution.”
Chauke says the VBS investment will most likely affect service delivery.
The municipal workers union – Samwu – the whistle blowers on municipalities investing in VBS – says law must take its course against the municipal officials implicated in the report.
The opposition in the Giyani municipality – Democratic Alliance (DA) – also wants action taken against the municipal officials. Councillor Richard Shivambu explains:
“I strongly believe that the forensic investigations should also go into the municipalities to establish who has taken that decision to take the money down there in the VBS because the mayor is pointing fingers at the chief financial officer the CFO basically doesn’t operate in isolation, he only takes instructions from the executive.”
Two municipal officials, CFO Hitler Maluleke and the technical services manager – Precious Mathebula – were suspended in connection with the VBS investment in the Giyani municipality.
Mathebula has since resigned. The outcome of the disciplinary action against the CFO will be made known soon.
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