On tv – Khawe promise a better Emfuleni – video
On air - Kawa promise a better Emfuleni
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JOHANNESBURG – Worthless contracts are to blame for financial woes in the Emfuleni Local Municipality, Mayor Jacob Khawe said on Wednesday.
Emfuleni in Gauteng is one of hundreds of defaulting councils across South Africa with the municipality not having had a clean audit in about five years.
The auditor-general said the municipality was the fourth largest contributor to unauthorised expenditure over the past three years.
Khawe says he will soon announce the termination of a number of contracts in the council.
“The real issue has been wasteful and fruitless expenditure. This current administration had a long discussion as to what could cause these two basic problems in financial terms,” the mayor added.
“We’ve established that the problem has been the type of contracts we have and we have taken a decision to relook at all these contracts.
“We’ll soon be announcing to the communities of Emfuleni about three or four big contracts that we’ll be terminating to make sure we save the money.”
Khawe says debt write-offs are always considered at length before decisions are made.
“Write-offs are not a bad thing – it’s an acknowledgement that you did not collect,” he said.
“So, if you keep it on your records, it means you are not financially sound. It’s a proper leadership decision when you write-off a debt that you not going to collect.”
READ: Irregular spending by Water and Sanitation Department rockets to R6.4bn
Makwetu on Wednesday revealed irregular expenditure by municipalities increased by 75-percent in the past financial year.
Fruitless expenditure went up from just over R16-billion to more than R28-billion in the same period.
Only 49 of the country’s more than 250 municipalities received a clean audit for the 2016/2017 financial year.
Makwetu told Parliament that “the non-compliance by over 78 percent of these municipalities, accounting to a total of about 186 [councils], can potentially result in financial loss.
Shockingly, the auditor- general revealed that all municipalities in the Free State required intervention.
Watch the video clip.
