KwaZulu-Natal commits to improving financial status of municipalities

KwaZulu-Natal Premier Zweli Mkhize.

The KwaZulu-Natal Provincial Government is committed to ensuring the good financial health status of all government departments and municipalities in the province, says Premier Zweli Mkhize.

Auditor-General Terence Nombembe announced this week that four of only 13 municipalities which received clean audits were in KwaZulu-Natal, and the majority of municipalities that received unqualified audits were also in the province.

The African National Congress in KwaZulu-Natal has described the audit outcomes of municipalities in the province as a "shining light of excellent service delivery", but opposition parties say only five out of 61 municipalities achieving clean audits represents a failure.

Addressing the media following this week’s release of the audit outcomes of municipalities for the 2010/2011 financial year by the Auditor General, Mkhize said continuous improvement measures, related to supply chain management would bring those municipalities that had regressed or whose status remained unchanged to a more favourable status.
 
According to the audit findings, there were five municipalities in the province with clean audits - Umdoni, Richmond, Emadlangeni, Umtshezi and Umzinyathi District.
 
The seven municipalities with qualified audit opinions were Jozini and Uthukela District - which was a regression from the previous unqualified audit opinion - Amajuba District, Hlabisa, Umvoti, Newcastle, and Edumbe which was an improvement from the previous disclaimer.
 
The Indaka Municipality received a disclaimer which was a regression from the adverse opinion of the previous year while the Umkhanyakude District Municipality received an adverse opinion regressing from a qualified audit in the previous year.
 
“Regression in the four municipalities is as a result of poor document management, insufficient financial resources, daily and monthly reconciliations not being done and poor asset management,” Mkhize said.
 
During the 2009/2010 financial year, inadequate financial controls were registered at a 60% level.
Mkhize noted that there had been a significant improvement in the status with the current level at 18%.
 
With regards to the improvement measures, the premier said special emphasis would be placed on aspiring to effective supply chain practices, elimination of inadequate contract management and uncompetitive or unfair procurement processes.
 
The over reliance on consultants was still a concern as the decrease from 92% to 90% utilisation rate reflected the need for management intervention, Mkhize added.
 
“We are calling on all mayors to continue to provide leadership in the fight against maladministration and any form of corruption. As leaders we must protect the most vulnerable members of our society who are affected by this scourge. We will continue as the provincial government to promote integrity in all government departments and municipalities,” he said.