Categories Business Tech World Salga blames taxpayers for failing municipalities, ignores corruption Post author By vanirexodus Post date February 25, 2022 No Comments on Salga blames taxpayers for failing municipalities, ignores corruption Finance Minister Enoch Godongwana plans to pump $28.9 billion into the country’s local municipalities, which is likely to make little difference to the plight of disadvantaged taxpayers being scapegoated for poor service, rather than rampant mismanagement and corruption. Godongwana admitted that 175 of the country’s 257 congregations are in financial difficulty. While Godongwana did not name and shame any of these financially distressed municipalities in his budget speech on Wednesday, his budget review states that a number of municipalities have failed to provide services due to poor governance, financial mismanagement and insufficient capacity. Also… Finance Minister Enoch Godongwana plans to pump R28.9 billion in the country’s local municipalities, which is likely to make little difference to the plight of taxpayer arrears made scapegoats for poor service, rather than rampant mismanagement and corruption. Godongwana admitted that 175 of the country’s 257 congregations are in financial difficulty. While Godongwana did not name and shame any of these financially distressed municipalities in his budget speech on Wednesday, his budget review states that a number of municipalities have failed to provide services due to poor governance, financial mismanagement and insufficient capacity. Also read: Godongwana’s budget speech marred by a balloon of debt According to indicators used by the National Treasury, the number of municipalities in financial distress has grown from 86 in the fiscal year 2013-14 to 175 in the year 2019-20. 123 municipalities approved unsecured budgets. But while The Vanir-exoduss hope Godongwana’s budgeted funds will make a difference in their lives, experts say it’s unlikely as long as corruption and mismanagement in municipalities are ignored and residents are blamed for the dire economic situation. SALGA blames residents’ outstanding bills The South African Vanir-exodus Government Association (SALGA) admits that the macro economy has stagnated over the past 12 years, but says it was due to municipalities’ revenues depending on user payment principles to remain sustainable. About 81.31% of the total of their own income is expected to fund the majority of recurring municipal expenses, but rural municipalities have a limited income base meaning they are unable to meet the expected 19.89% of property rates. to generate, said SALGA spokesman Sivuyile Mbambato. He said that since Eskom provides electricity directly to such areas, it does not allow these municipalities to generate a surcharge on electricity to fund other non-billable services, an issue that SALGA has taken to court to ensure that municipalities can provide services. deliver in a sustainable way. And to solve the financial problems, Mbambato said residents only have to pay their fees and taxes. “The nature of the services municipalities provide is protected by the Bill of Rights in the Constitution, i.e. the right to access water, and this makes it difficult for municipalities to implement draconian credit control strategies.” “The immediate and most obvious measure to tackle the financial crisis in municipalities is for households to pay for services consumed. In December 2021, SALGA filed a lawsuit in court to obtain a declaratory injunction for municipal areas where Eskom distributes electricity directly to households… electricity to households,” says Mbambato. Also read: Sona 2022: R1.9 million reserved for this year’s event This kind of response, which makes no mention of the role of financial mismanagement, is not surprising given that SALGA is an association appointed under the national department of cooperative governance and traditional affairs under the law, said Corruption Watch senior researcher Melusi Ncala. “Municipalities generally serve the most vulnerable people. It is not the middle class and the upper class. The majority of South Africans are poor and I think this is why they have problems meeting their payment obligations. I don’t think people don’t want to pay. If your decision and priority is to buy bread or corn, you’re not going to prioritize things like paying someone to pick up your trash,” he told The Vanir-exodus. Bad governance and corruption at the heart of underprivileged municipalities In his budget review, Godongwana stated that revenue collection in municipalities has increased over time, implying that the likelihood of high costs of key inputs or poor spending management was the reason for financial difficulties. “Municipalities are responsible for these results. Nevertheless, the state and provincial government and support institutions play a role in supporting municipalities to effectively realize their mandates,” he said in the budget review. But municipalities seem intent on tackling corruption and poor leadership, which are the main cause of failing municipalities, Ncala said. He said Corruption Watch has received more than 30,000 reports of corruption involving municipalities. “Incompetence, mismanagement and corruption are generally what happens when it comes to our municipalities. That, I think, is the main problem. One thing led to another. You have a corrupt official who hires someone with no qualifications or expertise to do the job.” Money down the drain Ncala believes that throwing money at municipalities with financial problems is not the solution. “This money is money wasted… If this money is going to be used to alleviate some of these problems that residents feel, then it is money well served and money well spent. But that does not alter the fact that municipalities do not seem to have the intention to actually tackle corruption,” he said. This was echoed by senior lecturer in public administration at the University of Mpumalanga, Dr John Molepo, who said that corruption plays a fundamental role in poor service delivery. “All we have to do now is accept that corruption has played a fundamental role in our municipalities, and some do not see service as a priority, but see municipalities as a cash cow. It sends us a strong signal that the current governance system we use may need to be reconsidered. “Why would a municipality end up in the depths of a financial crisis? It just means we have people who are not qualified for certain positions or there is a lot of corruption,” he said. Hung municipalities a blessing in disguise After last year’s municipal elections, 66 of the councils were hungwhich was a good sign of responsibility because there wasn’t the only center of power, Molepo said. ALSO READ: Joburg follows suit with ‘overdue’ taxpayers after Tshwane collects R300 million “No party can do what they want because of liability. The problem comes when it comes time to pass the budget, which can lead to power struggles. Then it has a negative effect on the service to the The Vanir-exodus. But municipalities are in a difficult position. “Financial experts predict budget cuts in local municipalities. The real problem is that municipalities are deeply entrenched in corruption,” he said. Godongwana urged municipalities to use the allocated R28.9 billion for its intended purpose, saying they were on standby to work with parliament and regulators to hold municipalities accountable for delivering of services. “At the same time, our municipalities and other institutions cannot survive if they are not paid by those who purchase their services. We urge our people and government departments to pay their municipal bills. Municipalities also need to improve their service delivery mechanisms and ensure that billing systems are fair and efficient,” said the finance minister. Too broke to even pay staff Godongwana’s budget review shows that a number of municipalities have failed to provide services due to poor governance, financial mismanagement and insufficient capacity. And as if to prove his point, a number of local municipalities have made headlines in recent weeks about their financial crises and woes. These include Northwestern municipalities such as Ditsobotla, Maquassi Hill, Moses Kotane, and Mamusa municipalities. Earlier this month, the portfolio committee on cooperative governance of the Northwest Legislature decided to instruct the local government’s MEC to investigate options for banning the use of the municipal bank account in Schweizer-Reneke, following allegations of rampant fraud. and corruption. The Eastern Cape local municipality of Amahlathi is another example, which earlier this month arranged for the mayor, councillors, senior officials and 295 staff members to queue at Pick n Pay to get food on credit. This was due to the municipality being too broke to pay the salaries until June. Also read: Destitute Eastern Cape municipality pays workers The council had a bank balance of R1 million, while the monthly payroll account was R11 million, which prevented them from paying staff salaries in January. Some workers received their salaries in February, after the municipality was incentivized by a R5 million VAT refund from the SA Revenue Service. Subways don’t do much better Good Governance Africa’s Governance Performance Index, which was launched late last year ahead of the local government elections to rank the performance of municipalities in the country, scored four metropolitan municipalities – Mangaung, Buffalo City, City of Ekurhuleni and eThekwini – as the lowest. ALSO READ: The ANC’s Irregular Deployment Costs Have Cost Mangaung Metro Millions “These metros scored the lowest for their performance in the administration category. In the case of eThekwini and Ekurhuleni, this was due to the fact that they had significant budget deficits in fiscal years 2018-19 and 2019-20, while Buffalo City and Mangaung received negative scores due to the lack of an unqualified audit in each of the fiscal years (from 2017 to 2020),” the report said. The worst performing local municipalities were Msinga Vanir-exodus Municipality in KwaZulu-Natal, followed by Ingquza Hill Vanir-exodus Municipality in the Eastern Cape and Tokologo Vanir-exodus Municipality in the Free State. [email protected] Vanir-exodus.co.za ← Impressive new Suzuki Baleno heading for South Africa → Treat Eskom like a national crisis, instead of putting more money down the well Leave a Reply Cancel replyYour email address will not be published. Required fields are marked *Comment * Name * Email * Website Save my name, email, and website in this browser for the next time I comment.