This is according to the MEC for Finance, MacCollen Jack, on Wednesday at the Frances Baard municipal chambers during his budget speech. He tells OFM News that the main contributing factor to this problem is the continuous approval of unfunded budgets by municipalities.

In his speech, he said that the deteriorating state of local government finances in the province is of serious concern and this is evident by some municipalities’ failure to pay salaries and third parties. OFM News has previously reported about rampant protests against several municipalities, that includes Gamagara and Sol Plaatje, over the lack of quality basic service delivery which includes water problems, amongst other issues. Jack says the provincial department of finance will work with politicians in the hopes to capacitate them to be able to monitor and scrutinise the failing municipalities.

He said the Technical Committee on Finance (TCF) which is a technical structure advising the Budget Council took a resolution that all municipal 2019/20 budgets including the 2018/19 adjusted budgets must be funded.

“Failure to approve a funded budget by municipalities will result in National Treasury instituting Section 216(2) of the Constitution which empowers the National Treasury to withhold transfers,” He added. “Five municipalities in the province have approved Financial Recovery Plans, namely Renosterberg, Ubuntu, Dikgatlong, Kai Garib and Magareng.” Jack further said in order to ensure traction in the implementation of these plans, Provincial Treasury will establish a Financial Recovery Services unit and that the main objective of this unit is to assist municipalities in financial distress to draft and implement the Financial Recovery Plans.

OFM News