Outlining local government audit outcomes for the 2018/19 financial year, Head of the AG in the Free State, Luthando Mbandazayo, says deteriorating infrastructure due to a lack of maintenance, unmetered consumption, leakages, and illegal connections resulted in municipalities incurring significant water and electricity losses of more than R404 million. Mbandazayo says municipalities' deteriorating financial health is due to their inability to manage their finances.

OFM News previously reported that he has flagged a lack of accountability by political and administrative leadership as another contributing factor to their financial debacle.

According to the AG's latest report,  municipalities in the province not only failed to produce clean audits but has their expenditure exceeding their revenue.

Mbandazayo has highlighted that besides their Eskom and Water Board debts, municipalities across the province fail to comply with Supply Chain Management legislation, resulting in high irregular expenditure, which now stands at R1.7 billion.

Mbandazayo says preventative controls, sound leadership, and maintenance of infrastructure are key to improving Free State municipalities' financial health.

OFM News