NELSPRUIT – The finances of Mbombela Local Municipality (MLM) are coming under pressure since it has still not appointed a new chief financial officer (CFO). The municipality may forfeit a R160-million loan which it was granted by the Development Bank of South Africa (DBSA) in July if it does not appoint a new CFO by October 17.
Of the total, approximately R138,4 million is earmarked for the municipality’s capital-expenditure programme, with the remaining R21,6 million to be spent on financing a new fleet. The programme includes projects such as bulk water, electricity, sanitation and the establishment of new townships.
However, according to the terms of the loan, it can only be awarded once MLM appoints a CFO. Similarly, rollovers from the 2011/12 and 2012/13 financial years can only be received if one is appointed. This amounts to R207 million. At the moment, Mr EC Mgwenya, the municipality’s CFO, is in an acting position.
At the time of going to press, Mr Joseph Nagala, spokesman for MLM, did not respond to questions about when they were planning to appoint a new officer, or what steps were being taken by the municipality to avoid missing the deadline for complying with the terms of the loan that were sent to him a week ago.
Issues surrounding its finances and governance are currently being investigated by Msikinya Attorneys & Associates on behalf of the Department of Cooperative Governance and Traditional Affairs.
