THIS was the concern raised by the Gauteng Finance and Economic Development MEC Lebogang Maile, who was briefing members of the press today, at the Gauteng Legislature, on the State of Audit outcomes of Gauteng’s 11 municipalities.
The MEC said a number of Gauteng municipalities that submitted credible financial statements for auditing increased by five percent, from 33 percent to 38 percent.
Maile’s address follows the report by the Auditor General of South Africa (AGSA) Tsakani Maluleke last week, on local government audit outcomes for 2022/23 financial year.
Gauteng Province is the nerve-centre of the South African economy with 11 municipalities in total – 3 metropolitan municipalities, 2 district municipalities and 6 local municipalities.
Maile said the report by Auditor General showed that the overall municipal audit outcomes for Gauteng stabilised in 2022/23 financial year, with 7 out of 11 municipalities receiving unqualified opinions.
“Greater urgency is required from accounting officers, mayors and members of mayoral committees to address service delivery challenges. Internal audit units and audit committees should intensify their quarterly assessment of performance information.
Council oversight committees should hold executive leadership accountable for the implementation of service delivery plans.”
This, said Maile, affected the basic services meant to be delivered to communities.
Over a five-year period from the 2018/19 to the 2022/23 financial years, Midvaal Local Municipality maintained clean audits. In the same period, the City of Johannesburg, West Rand District Municipality, Sedibeng District Municipality and Lesedi Local Municipality maintained unqualified audits.
The City of Tshwane, which maintained unqualified audits with findings for the first three years under review, received an adverse opinion in the 2021/22 financial year before moving to a qualified opinion in 2022/23 financial year. Rand West City Local Municipality, which received qualified opinions in the 2019/20 and 2020/21 financial years, saw an improvement in 2021/22 with an unqualified audit outcome, which it has since maintained.
“In the period under review, Emfuleni Local Municipality obtained qualified outcomes in the first two years, an unqualified outcome with findings in the 2020/21 financial year, and two consecutive qualified outcomes in the succeeding financial years. The City of Ekurhuleni, which received an unqualified outcome with findings in the first year under review, and three consecutive clean audits subsequently, received an unqualified outcome with findings in the 2022/23 financial year.
This marks a regression,” MEC Maile said.
The MEC said the number of Gauteng municipalities that submitted credible financial statements for auditing increased by 5% – from 33% to 38% in 2022/23 financial year.
“This improvement is attributed to intensified reviews by senior management, internal audit units, audit committees and the Gauteng Provincial Treasury (GPT), the Gauteng Department of Cooperative Governance and Traditional Affairs (COGTA) and the South African Local Government Association (SALGA). It should be noted that 2023 was the first time that sector departments combined efforts in strengthening the review process. This initiative, coupled with the production of interim financial statements, is aimed at improving the quality of reporting by municipalities, resulting in financial statements free from material misstatement and/or omissions,” MEC Maile explained.
Turning to performance against targets, MEC Maile said the quality of submitted performance reports improved from 50% to 54%. Commendably, residents were engaged during public participation sessions in setting priorities.
“However, in some instances the related performance targets were then either revised or not prioritised, resulting in communities not receiving the desired services. Targets not being achieved further affected the adequacy of basic services delivered to communities. In response to our previous year’s call to action, the metros included the National Treasury’s common performance indicators in their performance reports.
However, greater urgency is required from accounting officers, mayors and members of mayoral committees to address service delivery challenges. Internal audit units and audit committees should intensify their quarterly assessment of performance information. Council oversight committees should hold executive leadership accountable for the implementation of service delivery plans,” the MEC said.
Skills is also a bone of contention in that some of the personnel can’t perform their jobs, because of lack of appropriate qualifications, amongst others.
This resulted in outsourcing or procuring independent contractors to do the same task they’re hired for, that comes with unnecessary expenditure which municipalities fail to account for.
Image SLM (MEC for Economic Dev and Finance in Gauteng, Lebogang Maile, presented audit findings on municipalities in the province).
