KwaDukuza municipality has failed to spend R108,6 million in funds set aside for capital expenditure, acting mayor Dolly Govender reported to council last Thursday.
This underspending on capital projects was one of the red lights that stood out in the acting mayor’s fourth quarter budget and performance assessment report for the 2018/19 financial year.
It showed that KDM had only spent 43 percent of its budget for projects like housing, electrical infrastructure upgrades and road maintenance.
This means funds allocated for infrastructure and other projects in the district are not spent, causing a ripple effect of maintenance-related problems.
Grant money which is unspent is often requested back by the national treasury to be allocated to other municipalities.
Last year, the municipality had to give back R15 million of grant funding, meant to be spent on electricity infrastructure upgrades.
Govender told council it was imperative that municipalities adopt appropriate monitoring systems and take corrective steps where underspending was recorded.
She stressed the importance for departments to start planning for their expenditure even before the start of the financial year.
The Electrical Engineering Department spent half of its R58 million budget while Civil Engineering and Human Settlement recorded the highest discrepancy in their R118 million budget, with R36 million unspent.
The acting mayor stressed that unless financial management and fiscal governance improved, they could not improve on service delivery and spearhead development.
The municipality approved R344.7 million as a capital budget in the current financial year, with the majority of the funding being allocated towards electrical upgrades, road infrastructure projects and community recreational facilities.
The budget has been adjusted to R236 million, indicating an underspending on capital projects.
Most local councillors said this was simply unacceptable. DA caucus leader Madhun Sing said underspending on projects was a trend that showed poor service delivery.
IFP PR councillor Moosa Motala expressed grave concerns for the underspending on the capital budget and said council needed to identify the possible problems in implementing municipal budgets.
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