Durban - The eThekwini Municipality, with an annual budget of nearly R54 billion, was among the municipalities accused of failing to submit good quality financial statements to the Office of the Auditor-General for auditing purposes.
Auditor-General Tsakani Maluleke detailed the state of the municipalities in a briefing this week, citing many challenges, including the failure to submit good quality statements.
While the city maintained its good standing with an unqualified audit, the A-G noted that it had been made with findings.
“eThekwini, which accounted for 53% (R47bn at the time of the audit) of the local government budget in the province, retained its unqualified opinion with findings. To improve its audit outcome, the metro should focus on strengthening its monitoring and review of procurement and consequence management.”
She said while the municipality had submitted its financial statements on time as legislated, the quality of its statements was “not good”.
The report showed that the municipality had achieved the same audit outcome for the past five years.
Highlighting the challenges faced by the city, the A-G said close to 8% of positions at senior management level in the eThekwini metro are vacant, including that of the city manager.
The metro, which has about 25 000 employees, has a vacancy rate of about 14%, the office of the A-G found.
It found that next year’s budget would pay for expenditure of the previous year(s), that 53% of municipal debt was irrecoverable in the trading services, and that the city had bled R1.8bn in water losses.
The report found the metro, with a population of 3.4 million, had an unemployment rate of 30% and 39% of that was youth unemployment.
It found that 60% of residents had access to piped water inside their dwellings, but 90% had access to electricity for lighting and only 63% of residents have flush toilet-connected sewage, while 86% had weekly refuse removal.
Mayoral spokesperson Mluleki Mntungwa said the mayor had not had a chance to study the full report.
“The leadership will only be able to speak on the report once they have studied it.”
While other municipalities in the province struggled, the report showed that the King Cetshwayo District in northern KZN was among the better performers. Its audit opinion moved from unqualified with findings to unqualified with no findings, and it was among those municipalities that had submitted good quality financial statements for auditing and on time.
However, it had relied on consultants, as it paid them close to R500 000 because of a lack of skills internally, due to its vacancy rate of around 15.5%.
Meanwhile, the mayor of Msunduzi Municipality, Mzi Thebolla, said the improvement from disclaimers and an adverse audit opinion to an unqualified opinion reflected the commitment from the political wing to ensure a functioning and transparent council.
“When one looks at what has been the state of affairs in terms of audit opinions, there is a sign of improvement. We are mindful of the issues raised by the A-G,” said Thebolla.
He noted how irregular expenditure had been a consistent feature and a concern for the Office of the A-G, but pointed out that there were instances where the municipality had been forced to carry out transactions that had not been planned for.
“We have had disasters in our city which have compelled us to take money from other budgets to carry out emergency services to the affected areas. And this has put the municipality at loggerheads with the A-G,” said the mayor.
The mayor added that the unqualified audit opinion should bring hope to residents that their political leadership was committed to clean governance.