North West Acting Premier, Louisa Mabe has urged municipal councils to fire incompetent, unqualified and unskilled employees in the interest of service delivery and their communities. This follows a damning general report on the Municipal Finance Management Act provincial audit tabled by the Auditor General (AG) on Monday.
In expressing disappointment that for the second consecutive year, none of the 24 municipalities and four municipal entities in the province received a clean audit, Acting Premier Mabe commented Bojanala Platinum District Municipality and Ratlou Local Municipality for receiving unqualified audit opinions with findings.
Mabe said that the provincial government shares Auditor General Terence Nombembe’s concern that local government leadership in the province does not take the message from the AG seriously and is extremely worried that only 9 of the 24 municipalities submitted financial statements as at 31 January 2012. 29% of municipalities and entities received either qualified or disclaimed/adverse audit opinions.
Supply Chain Management, predetermined objectives (service delivery), human resource management, information technology controls and material errors and omissions in the financial statements were five critical areas that the AG had identified that the province had stagnated in.
Nombembe’s report identified three underlying challenges to be addressed by the municipal government leadership in order to achieve clean administration in the province as lack of appropriate skills at all 100% of the municipalities, poor performance management practices, with no formal consequences for poor performance and transgression s at 92% of the municipalities; and an inability on the part of most municipal leaders to demonstrate an appetite for taking ownership of good governance practices required in their institutions, a evidenced by their disregard for deficiencies previously identified at 92% of the municipalities.
“A culture of accountability can only be enforced by a strong and committed leadership” said Nombembe, who stressed the need for effective internal audit units, audit committees and municipal public accounts committees.
Acting Premier Mabe said that the provincial government is in the process to roll-out a phased-in financial management improvement support programme to municipalities.
The first of such phases has started with the sourcing of sixteen (16) service providers who have already been deployed to the municipalities in order to assist them with the preparation and submission of 2011/2012 financial statements which are due for submission on or before 01 August 2012.
Tswaing, Moretele, Maquasi Hills, Kgetlengriver , Ventersdorp, Ditsobotla, Mahikeng and Kagisano- Molopo Local municipalities are currently benefiting from this initiative.
The second phase of the interventions, which will be much more intense and broad, would entail assisting six municipalities with comprehensive turnaround strategy and five municipalities within the Ngaka Modiri Molema District with the General Recognised Accounting Practice (GRAP) 17 implementation.
“We expect an improved performance and audit outcome in the next audit cycle as a result of the steps we have taken to support our municipalities expect as these initiatives are intended at assisting municipalities with sound financial management to attain clean audits by 2014 would also be rolled-out to other municipalities in future.
It is incumbent upon municipalities to ensure that they appoint staff with relevant skills and put systems in place in order to give delivery of quality service delivery priority,” said Mabe.
The provincial government welcomes quarterly municipal door-to-door visits to be undertaken by the Auditor General to monitor and evaluate the status of improvements and the sustainability of key internal controls and leadership tone that would serve as a catalyst for realising clean administration in municipalities would be undertaken.
Insights to be shared with the provincial executive and oversight leadership on a quarterly basis will create a platform for forward momentum towards clean audit and closer working with internal audit units and audit committees.
The partnership involving the Provincial Treasury, Department of Local government and Traditional affairs, South African Local Government Association (SALGA) and the University of the North West driven by Premier Thandi Modise to ensure on-going capacity building will be intensified as part of the local government turn-around strategy to improve financial management in municipalities.