Johannesburg - A new report by Limpopo provincial government into the collapse of Modimolle-Mookgophong Municipality has painted a gloomy picture of poor financial management and leadership.
The cash-strapped municipality, governed by a DA-EFF coalition, was placed under provincial administration earlier this year.
The September report, by the Limpopo Department of Co-operative Governance, Human Settlements and Traditional Affairs, labelled the deficiencies in the municipality as financial and systematic, citing poor leadership and management as reasons for the collapse of governance.
“Employees do as they please. Matters such as leave encasement are handled poorly,” the report stated.
The municipality is technically bankrupt as liabilities far exceed assets. The salary bill is estimated at R8million with an additional R3m of third parties payments, the report notes.
The municipality will not sustain payment of salaries and provision of services if the financial situation remains the same, it warns.
“Some people are paid for doing nothing. Others just don’t come to work regularly. There is no accountability,” said one employee, who did not want to be named.
The report notes how the 2016 merger of the two local municipalities caused instability among employees.
However, it points out that municipal management failed to provide direction.
Patrick Aphane, provincial secretary of the South African Municipal Workers’ Union (Samwu), said it has not received any assurance from the municipality that members will receive their salaries each month.
“From time to time we are told that our members may not be paid. It’s something that keeps going on.”
Meanwhile, the report cited the high vacancy rate within senior management as having destabilised the municipality and “negatively affected its performance”.
Mayor Marlene Van Staden expressed confidence in the recovery process led by the provincial government. “I don’t know why municipalities who are struggling financially are afraid of being placed under administration. I’m confident that process will yield positive results. It’s not easy but it has to be done.”
The provincial executive council approved an injection of R70m to help the municipality pay for its basic services.
However, the council wants allegations of corruption and maladministration investigated.
By May, the municipality owed creditors more than R350m.
Van Staden said it has been resolved that the R70m should not be placed in the municipality. It would rather have the province pay all creditors directly.
The report showed how R83m of grants received by the municipality have been used for other purposes and “are not cash-backed”.
Van Staden dismissed reports linking the municipality to investments in the Venda Banking Society (VBS).
Eight Limpopo municipalities illegally invested money with the embattled bank, contravening the Municipal Finance Act.