27/07/2012. SALGA chairman Thabo Manyoni and Imatu president Stanley Khoza briefs the media about the conclusion of municipal wage negotiations. Picture: Matlhodi Madibana

The SA Local Government Association (Salga) has defended the failure by 95 percent of municipalities in the country to get clean audits, saying there had in fact been a significant improvement in their performances.

This follows Auditor-General Terence Nombeme’s report this week, which revealed that only 13 of the country’s 343 municipalities had managed clean audits.

Salga chairman Thabo Manyoni said yesterday there had to be less exaggeration but more examination in interpreting the AG’s report.

He was speaking at the signing ceremony of the multi-year wage agreement reached between the body and labour unions yesterday.

“A biased picture of virtual collapse of financial management in local government, including the major cities, is being painted.

“But a closer examination of the AG’s findings, and a more rigorous understanding of the nature of these audits, and their terminology, paints a different picture,” said Manyoni.

Manyoni said Salga acknowledged there was a long way to go for many municipalities, but said the report showed that more municipalities had received unqualified audits, which did not necessarily mean that public funds were being squandered.

“First, we need to address the misnomer that there is somehow a meaningful difference between a clean audit and an unqualified audit.

“The reality is that there is not, and in any event, the concept of clean audits is a national government initiative and not necessarily an international auditing standard,” said Manyoni.

He noted that 128 municipalities received unqualified audits, meaning no financial irregularities were found and there was compliance with laws and regulations.

“We need to look into the facts, which include, for example, that 87 percent of municipalities in KwaZulu-Natal had received unqualified audit opinions, which is higher than they received before.

“But currently the trend is to tar everybody with the same brush.

“We are not anywhere near where we were some years ago.

“There are municipalities which need to be celebrated for the strides they have made in the last few years,” said Manyoni.

Salga also noted that unauthorised expenditure in municipalities had decreased from R6.3 billion to R4.2bn, which it attributed to the introduction of new systems and controls, and better financial management.

The body acknowledged that serious problems existed with some municipalities in the Eastern Cape, Free State and North-West, where a majority of disclaimers were received.

“It is clear that Salga and its stakeholders should focus initiatives to assist municipalities in these provinces to improve the audit findings,” it said.

Salga also announced yesterday that it had reached a multi-year wage agreement with the labour unions, which will see workers receiving a 6.5 percent wage increase.

They will also receive an additional 0.5 percent increase in January and Consumer Price Index (CPI), plus 1.25 percent and CPI, plus 1 percent in 2013/2014 and 2014/2015 financial years, respectively.

Labour union Imatu welcomed the conclusion of the negotiations, saying they had taken place under difficult circumstances but were concluded amicably.

“We started negotiating two months ago and at times it appeared that we were not going to reach a peaceful settlement.

“Because the agreement is multi-term, we can now focus on the business of service delivery instead of spending time working on wage negotiations,” said Imatu president Stanley Khoza.

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