Mkhondo scraps over R400 million in unauthorized expenditure

Issued by Irene Brussow – DA Caucus Leader in Mkhondo Local Municipality
04 Sep 2023 in Press Releases

The DA in Mkhondo calls on the MEC of CoGTA, Mandla Msibi to consider overturning an ANC council resolution, writing off unauthorized expenditure worth over R400 million.

This multi-million unauthorized expenditure amount was resolved to be written off at a special council sitting held on August 24. We view this as an abuse of Section 32 of the Municipal Finance Management Act (MFMA).  

This misguided decision favours ANC cadres, while the municipality remains in financial crisis.

According to a council item tabled at this sitting, there were poor budgeting processes in the municipality, and there was no evidence suggesting that the unauthorized expenditure was incurred with the intention to defraud the municipality. 

These findings were made by MNF Professional Accountants and Consulting, one of the forensic firms appointed to investigate maladministration and corruption amongst other things in the municipality. 

Over a month ago, it came to light that the municipality had appointed more than five forensic firms from different parts of the country to conduct investigations into serious malpractice that has occurred or is occurring in the municipality.

The DA spoke against this on the basis that the department of CoGTA had already triggered section 106 of Local Government Municipal Systems Act to conduct investigations. 

The municipality has now committed to adopting a financial turnaround plan, supported by the provincial treasury, focused on revenue enhancement and the effectiveness of management controls. 

The ANC administration in this municipality has been failing to adhere to treasury policies aimed at enhancing revenue. The proposed financial turnaround plan is therefore nothing but fiction. 

Treasury regulations state clearly that an accounting officer must take effective and appropriate disciplinary steps against any official in the service of the department who makes or permits unauthorized expenditure. The DA calls for this to be implemented urgently and will be monitoring progress in this regard.

It is unacceptable that millions in taxpayers money have gone unaccounted for while residents of this town are deprived of services.