Eastern Cape Municipalities on the verge of collapse

Municipalities across the Eastern Cape are in crisis.

People across the province are waking up to piles of uncollected rubbish, dry taps, no electricity and deteriorating municipal infrastructure, as the consequences of years of poor governance and lack of proper financial management have begun to manifest.

Municipal workers and service providers are going unpaid and service delivery has all but ground to a standstill as municipal coffers run dry.

“In response to a parliamentary question, MEC of Cooperative Governance and Traditional Affairs (COGTA), Xolile Nqatha, confirmed that 14 municipalities across the province have been identified by the Department as being in a state of ‘distress’, said Vicky Knoetze the DA Shadow MEC for COGTA in the Eastern Cape.

MEC Nqatha also confirmed that he had approached National Government for funds in February this year to bailout these unsustainable, bankrupt municipalities.

The impact of poor governance is clear. The latest available audit figures show that 13 Eastern Cape municipalities have regressed in terms of audit outcomes for the 2019/20 financial year.

Of concern though, is that only five of these 13 municipalities are on COGTA’s list of municipalities in distress.

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Eight municipalities are not on the list, including Sakhisizwe Local Municipality, which recently could not pay their staff, and Sunday’s River Valley Municipality, which has been without water for over a week, as Eskom cut electricity to their pumping stations due to non-payment.

“The Democratic Alliance believes that COGTA’s list is a gross underestimate of the problem, and that the number of distressed and unsustainable municipalities is in fact much higher,” added Knoetze.

This will become even more apparent in the coming months, when the economic impacts of the Covid-19 pandemic, and subsequent enforced lockdown, begin to impact on municipal revenue streams.

There has already been a dramatic increase in the level of under-collection on rates across the province.

Kouga Municipality received an unqualified audit report with finding relating to performance management preventing a clean audit.

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