Cape Town - Embattled Kannaland mayor Jeffrey Donson nearly lost his cool in the provincial legislature, threatening to beat up MPLs for unfairly discriminating against the municipality on Wednesday.
The municipality was given the cold shoulder by both the national and provincial treasuries, turning down its request for a long-term loan to settle its R12.7 million debt with Eskom.
The municipality earlier wanted approval for its proposal to the use of a R7.3m bank loan by putting up municipal assets as collateral, which it would then pay back over 84 months.
The municipality wanted to incur long-term borrowing of R8.7m in total.
Donson made it clear that he would not tolerate the Treasury talking negatively about the municipality without being given a right to reply.
National Treasury’s chief director of Municipal Finance Management Act (MFMA) compliance, TV Pillay, gave an overview of the legislation in terms of the MFMA involving long- and short-term borrowing.
Pillay said in their correspondence with the municipality they had advised the municipality to consider taking up a bridge finance facility in terms of the MFMA to ensure it met its commitments as agreed with Eskom.
He said he had been informed that provincial Treasury along with the municipality were already in talks with Eskom for further arrangements.
Pillay said should this not work the municipality should approach provincial or national Treasury to assist with a holistic financial recovery plan.
According to Pillay there is some structural imbalance that is at play in the municipality.
“Revenues are not being collected and expenditure needs to be reviewed.
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Provincial Treasury’s Harry Malila said they were proposing that the municipality renegotiate the repayment terms with Eskom and settle on repayment terms that are affordable.
“If they are prepared to pay Standard Bank over a period of 84 months and they can prove that to be affordable, we think that is a proposal they need to put on the table to Eskom and demonstrate to Eskom the commitment to repay the amount.
“And they negotiate with the bank to have a facility arrangement with the bank and then only to draw down as they can actually afford it on a 12 monthly basis,” he said.
Kannaland’s municipal manager, Morné Hoogbaard, said their plea to provincial Treasury has always been, “support us the way you support other municipalities”.
Hoogbaard stressed that the issue of the loan was “no longer on the cards” because they’ve advised the town’s council about the recommendations by Treasury and the bank turning down the loan.
“The lights are still on in Kannaland. We have submitted to Eskom an alternative and a realistic option would be not to take any loan because we have not taken a loan in five years. We’ve asked Eskom for a repayment over the same time we would have accepted a bank loan,” he added.
He stressed that the municipality has not taken a loan and as the accounting officers they’re not going to advise council in any other direction,” he said.
Donson shouted his unhappiness in the corridors, but not before giving the committee a piece of his mind.
Speaking in Afrikaans Donson said Kannaland was being excused without being given an opportunity to respond.
“(You want to attack me politically and then silence me at the same time),” he told the chairman of the local government standing committee, Masizole Mnqasela.
Outside the House, Donson likened the MPLs to a bunch of gangsters.
“These are not parliamentarians, they nothing more than gangsters. They are playing politics here. People’s lives are affected and they play politics,” he shouted.
Cape Argus