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You are at:Home»Uncategorized»Mayor manages budget mayhem
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Mayor manages budget mayhem

Grocott's MailBy Grocott's MailAugust 29, 2011No Comments4 Mins Read
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Never again!' says Makana Executive Mayor Zamuxolo Peter after a large portion of the municipality's budget which sat unused in its coffers could be returned to the national treasury. Peter is preparing to apply for a roll-over of R53.7 million of unspent municipal funds. 

Never again!' says Makana Executive Mayor Zamuxolo Peter after a large portion of the municipality's budget which sat unused in its coffers could be returned to the national treasury. Peter is preparing to apply for a roll-over of R53.7 million of unspent municipal funds. 

As a result, the municipality is bracing itself for a penalty or at the very least a stern reprimand from the Auditor General.

These funds were reportedly unused while service-delivery protests and warnings about the collapse of Grahamstown's infrastructure surfaced at the beginning of the year.

At a meeting of the Budget, Treasury and IDP Portfolio Committee meeting in April the Council found that only 20% of the capital expenditure and conditional grant budget for 2010/2011 had been spent by the beginning of February.

The lack of fiscal planning came as a result, of among other things, missed meetings.

Councillors were furious that projects they'd spent months planning may never materialise because conditional grants, a large proportion of the unspent money, was not carried over to the next financial year. 

"Why do we sit and battle with [balancing]the budget and nothing happens?" said Councillor Les Reynolds

"People out there are jumping up and down, saying, 'We don't have roads, we haven't got toilets, we haven't got electricity, we haven't got water'. How do we say, 'Sorry, we can't do it', when we have large amounts of money sitting here?"

Treasury steps in
The municipality has consequently asked for assistance from the National Treasury to help revise the budgets for the 2011/12 and 2013/14 financial years.

"It is with regret I must stand in front of this council to table an application for the roll-over of unspent conditional allocations," said Peter.

He explained that if Makana hoped to keep the funds, they had to apply to the National Treasury in terms of Section 28 of the Municipal Finance Management Act.

This is an uncomfortable position for Peter, whose term began a little over two months ago.

"We cannot allow this in our term of office," Peter said and it is officials on whom he has come down the hardest.

Peter has given Municipal Manager and accounting officer Ntombi Baart, 14 days to submit a comprehensive report on reasons why directors did not spent the money.

He is adamant that this report will be tabled in the next Ordinary Council meeting in September.

He has also appealed to councillors, especially members of the mayoral committee, to closely monitor capital spending.

"Directorates must understand that they have got a double task," he said.

Not only did they have to implement the projects to be rolled over to this financial year, but they also had to ensure that projects approved for the current financial year were implemented.

Peter also suggested it would be counterproductive to deny there was a problem.

"When ratepayers raised concerns on the non-expenditure we were very much on the defensive," he said, referring to the public reaction to Grocott's Mail's April bombshell.

"This will not happen again," he said.

More bad news
In another blow to the municipality's governance record, Peter revealed that Makana would not be able to table an annual financial statement by the end of this month.

This meant the organisation would be in breach of the law, in terms of the Municipal Finances Management Act and explained that this was due to certain challenges experienced by the finance department.

"It therefore means that we will be penalised and cautioned by the Auditor General’s office for non-compliance," Peter said.

"But there is a commitment which I have received from the Municipal Manager's office to submit statements by at least 16 September.

This is a positive and encouraging statement from the MM's office. I just hope for the best. I believe the AG 's office has been informed accordingly and we will submit a report with reasons for our failure to comply."

Peter said he wanted want to make sure the audit committee had enough time to go through the statements in order to submit credible annual financial statements to the Auditor General.

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