Kouga Municipality writes off R 465 million

At a Special Council meeting held at The Links, St Francis Bay, the Kouga Council resolved to write off R 465.5m unauthorized, irregular , fruitless and wasteful expenditure.

Photo" Joey Nel
Photo” Joey Nel

“Unauthorized expenditure totalled R 364.9m, fruitless and wasteful expenditure totalled R 31.4m and irregular expenditure was R 69.1m.

All these exorbitant expenses and irregular expenditure occurred over a period of 5 to 6 years and it is a clear indication of extremely poor administration,” said Chimpie Cawood, the leader of the DA in Kouga.

Although it is a generally accepted practice in local government finances to write off some unavoidable expenses, it is alarming that in a municipality of Kouga’s size the unauthorized, fruitless, wasteful and irregular expenditure reach such huge amounts.

The unauthorized expenditure includes items like the following:

• Employee related costs R50.8 m
• Loss on disposal of property, plant and equipment (2010/11 and 2011/12) R2.287m
• Over expenditure on budget vote: remuneration of Councillors (2012/13) R211 970

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The fruitless and wasteful expenditure included:

• Interest and penalties R23.7m
• Payments made to directors while on suspension for more than 6 months R23.7m
• Legal costs relating to unfair dismissal R1.5m
• Settlement paid out to previous Municipal Manager R859 401

Irregular expenditure included:

• Study loans granted to employees contrary to section 164(c) of MFMA R401 371
• Performance bonuses paid to section 57 employees contrary to legislation R368 665
• Receipts misappropriated from caravan park R40 000
• Forensic investigation implicating two officials in SCM irregularities R1.8m
• Forging of signature for service provider procured for cutting of grass R19 500
• Tender awarded to business associate of a director of Kouga Municipality R13.8m

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