Dannhauser and Ladysmith were two municipalities in Northern KZN out of the 20 in the province that achieved ‘clean audits’ in 2013-14.
While Nomsa Dube-Ncube, MEC for Co-operative Governance and Traditional Affairs, trumpeted the announcement of the auditor general, saying that ‘it is proof that municipalities have been constantly showing us that they prioritise the proper management of public funds’, there was a dark side of waste too.
Unauthorised expenditure increased from R633-million of the previous year by 68% to R1,06-billion in 2013-14.
The Auditor General said ‘a total of R550-million of the total expenditure incurred was initially disclosed by the municipalities; however, a further R512-million was identified by the auditors.
“Of the R10,6-billion of unauthorised expenditure, R571-million arose from overspending of municipal budgets while the other R40-million was due to municipalities incurring expenditure on an allocation other than for its intended purpose.”
Amajuba District Municipality – under which Hattingspruit, Dannhauser and Newcastle fall – was one of the worst offenders, wasting R337-million mainly due to a loss in an investment company that was not budgeted for.
“The remaining balance of R725-million was spread among the other municipalities.” Irregular expenditure increased by 30% from R1,78-billion in the previous year to R2,3-billion in 2013-14.
Umzinyathi District Municipality, uMkhanyakhude and Msunduzi were the main contributors to the increase in the irregular expenditure balance, making up R934-million (40%).
The Auditor General indicate that leadership weaknesses were not addressed in many municipalities and that there ‘are significant weaknesses in internal controls, resulting in the extensive use of consultants without a positive impact on the audit outcomes.’