Cape Town - The beleaguered Beaufort West Municipality owes creditors a whopping R78 million in debt, as it battles cash-flow problems, critical vacancies and ageing infrastructure.
A senior delegation from the Western Cape local government department and the provincial treasury swooped on the Central Karoo municipality this month to probe irregularities.
What they found was a municipality with severe financial challenges, owing an array of creditors, with debt older than 90 days amounting to R51m at the end of August.
The municipality, which was previously controlled by the ANC, is now run by a DA and Karoo Democratic Force (KDF) alliance following the August 3 polls.
Local Government MEC Anton Bredell, who sanctioned the high-level assessment of the municipality’s finances, said the purpose was to ascertain the current status of the municipality and to determine how further the provincial government can provide support to the municipality.
“The total outstanding debt as at the end of August 2016 was R78m of which debt older than 90 days amounted to R51m,” he added.
Bredell said the assessment had zoomed in on key areas within the functioning of the administration, as well as its relationship with the newly elected council, which might have a potential impact on governance and service delivery arrangements within the municipality.
The MEC stressed that his team was concerned that the municipality had reported an overdraft amount of R5.1m used to cover day-to-day expenditure, as well the fact that the municipality continued to rely heavily on the national government to finance its budget.
Other key findings of the assessment included:
* The political leadership of the municipality is totally new, with five of the six councillors (Mayco) being elected to office for the first time.
* Training is required to familiarise them with the local government landscape.
* Technical service delivery is continuing as usual, with the normal challenges.
However, certain aspects require specific attention, such as critical vacant positions, an ageing municipal fleet and a lack of funding for ageing water network infrastructure.
* The provision of services, such as electricity, water, sewerage and sanitation, requires significant capital expenditure in infrastructure.
* Additional funding is urgently required for maintenance and upgrading of assets.
* The municipality does not have a fully functional supply chain management unit.
Bredell stressed that the Western Cape provincial government had resolved to support the municipality.
“The new council will be assisted with the development and implementation of a comprehensive support package,” he said.
The MEC said this was necessary in order to stabilise the municipality and improve governance and service delivery.
“The bottom line is achieving ongoing sustainability of the Beaufort West Municipality, and the prevention of disruption to service delivery to the community,” Bredell added.
Cape Argus