NELSPRUIT – Organs of state owe Mombela Local Municipality (MLM) R24,6 million for services provided. This was revealed last week during the mid-year budget performance report during a special council meeting.
At the close of the first six months of the financial year, the municipality was owed a total R476 million. This included R158 million in outstanding property rates, R73,7 million for electricity, R73,6 million for waste management, R26,4 million for water and R4,4 million in property rent.
However, the biggest debtor is households, which owes R371,8 million. The municipality noted in its performance report that 80 per cent of the total is more than 90 days old.
“It is doubtful whether MLM will be able to collect, however, a provision of doubtful debt amounting to R370 million has already been charged to the operating expenditure of the previous financial years,” it said.
It also underspent on its capital expenditure budget. The total year to date for new assets amounts to R69 million against the planned figure of R124 million, and for the replacement of assets amounts to R40 million against the planned figure of R164 million.
The year-to-date actual expenditure also amounts to R109 million against the planned figure of R287 million.
The municipality has requested a rollover of R127 million of unspent capital conditional grants from National Treasury, but only R2 million was approved.
The report noted that the financial-services department, responsible for the legally sound financial management and validity of the institution by ensuring compliance and implementation of prescripts, achieved only 32 per cent of its targets in the second quarter. It cited that this was partially due to challenges faced by the department, which it stated was outside of its control. The main ones were non-sitting of bid committees as scheduled and the delay on filling of critical vacant positions.
For instance, Mr EC Mgwenya, MLM’s chief financial officer, is currently in an acting position. The acting municipal manager, Mr Lolo Sello Ditshego, recommended that the 2013/14 budget be adjusted and the adjustment budget report be tabled to council by the end of the month.
