Poor financial management threatens service delivery in Ekurhuleni

by Cllr. Alta de Beer — DA Member of the Finance Oversight Committee in Ekurhuleni

Date: 07 May 2021

Release: Immediate

Type: Media statement

The Democratic Alliance (DA) in Ekurhuleni is greatly concerned over the over-expenditure incurred by the ANC-led coalition* in the City of Ekurhuleni (CoE) during the 2020/21 Financial Year.

The wasteful expenditure was laid bare through the tabling of various financial reports, that highlighted various examples of wasteful expenditure by the Metro, during a Virtual Council Meeting on the 29th of April 2021.

The first area of concerns the wiring off of indigent debt to the combined total of R501-million, equating to R16 000 per indigent. While the DA supports the writing off of indigent debt, given the extreme financial pressure and difficulty many indigents find themselves in, such write-offs, however, could be avoided through stricter financial controls. The installation of prepaid water and electricity meters could go a long way to avoiding such over expenditure by the Metro.

The second issue pertains to costs incurred related to the storage of council-owned vehicles. Many of these storage facilities lack the security required to prevent break-ins and vandalism. As witnessed first-hand by a visit by the Finance Oversight Committee in 2019, many of these vehicles have had parts stolen which include headlights, batteries, bumpers, tyres and even engines in some cases. The storage facilities resemble a second-hand car mall, with the only difference being that the Metro derives no revenue from the operation.

These storage facilities desperately need increased security to protect the Metro’s vehicle assets. In addition, the DA recommends that quarterly auctions of vehicle parts that are out of life cycle occur to offset the burgeoning costs the Metro is incurring as a result.

The final area of concern relates to employee overtime expenditure in the Departments of Economic Development, the EMPD, Water and Sanitation and City Planning, amongst others, with many reporting an eye-popping 100% in overtime expenditure. This infers that some staff members worked more than double their standard 40-hour workweek. This is impossible given the overall poor performance of these Departments relating to the dire state of service delivery in the City. This expenditure is clearly avoidable by implementing a shift system, long advocated by the DA.

Given the poor state of the Metro’s finances, any strategies that alleviation the over-expenditure as reported in the 2020/21 Financial Year should be welcomed. The DA’s proposals offer implementable and sustainable solutions to the Metro that is in desperate need of cash, translated into the multitude of service delivery failures experienced by residents.

The DA will continue to hold the incumbent ANC-led administration to account, and ensure that proper financial management practices are in place in the interests of creating a sustainable and responsive City.

*Coalition Partners: African Independent Congress (AIC), Pan Africanist Congress (PAC), Patriotic Alliance (PA) and Independent Ratepayers Association of South Africa (IRASA)

Cllr. Alta de beer

DA Member of the Financial oversight Committee in Ekurhuleni