Locking Up is Hard to DoMay 12, 2021
Forensic Report: Failure to Take ActionJune 9, 2021
It is our understanding that the purpose of the Annual Report process is to report on the executive management of the municipality by providing an honest and intelligible report so that residents can evaluate their performance, obtain the necessary responses, and ultimately to hold them to account for the spending of our money.
The standard of reporting in the Annual Report has sharply deteriorated over the years, a trend which accelerated over the past years. The report does not comply in many respects with the minimum requirements and is of virtually no value. There are millions of rands of “Other” with no explanations or details.
We would like to know what the reasons are for this shockingly poor performance on the part of management. What corrective steps have been taken? What planning, together with a time frame, has been put in place to rectify and prevent a recurrence? What has been done to hold those responsible accountable and the outcome? Alternatively, what steps will be taken to hold them to account, including a time frame?
Only once that is achieved will the report be meaningful and achieve its purpose. We, therefore, ask you to respond with the requested information, initiate the investigations and take corrective actions.
cc: Municipal Manager
PLETT RATEPAYERS’ REVIEW OF 2019/20 ANNUAL REPORT
Bitou 2019/20 Draft Annual Report.
- Councillors in Arrears. p 27 and 104 of A-G report Councillor Van Rhyner was sworn in as a councillor on 11 June 2020. All councillors’ outstanding municipal accounts are required to be reported at year end which is 30 June 2020; Van Rhyner appears to have been in arrears for over two years which disqualifies her from being a councillor, since a councillor may not be in arrears for over three months, and it can be a dismissible offense. What remedial action has been taken?
- Ward Committee Stipend. p 34 The stipend for ward committee members is R500 per meeting “conditional that they attend the meetings.” Ward committees are supposed to meet bi-monthly, yet committee members are being paid 12 times per annum regardless if they attend a meeting or not. This is irregular expenditure and must be recovered.
- Cost Containment. p 40 The risk assessment report states that the biggest risks facing Bitou Municipality are “inadequate budget to deliver on municipal objectives and ineffective expenditure management.” The RA has repeatedly appealed to Council to adopt the National Treasury Cost Containment Guidelines. It is of grave concern that the Council continues to waste millions of rands on frivolous nonsense which has nothing to do with municipal objectives. For example, attendance at conferences/seminars increased from R340,000 to R845,000 last year despite the Covid lockdown.
- Water Losses. p 87 Bitou reported water losses in excess of 19%. The national benchmark is 5%. Bitou’s losses were 7.6% in 2017. The Financial Statements report that water losses cost Bitou R3.1 million last year, up from R2.2 million the year before. This is a clear indication that the water infrastructure is failing and that insufficient attention is being given to that.
- Fiscal Cliff. p 104 Bitou has +10,250 people on the housing waiting list and it continues to grow. Bitou’s unemployment continues to grow, we have serious water constraints, the cost of free services and outstanding debt are out of control. This is not sustainable.
- Municipal Law Enforcement. p 134 says we have 14 Municipal Law Enforcement officers, yet the Senior Manager of Security spent R517,000 on uniforms — that is R37,000 per person. And we spent R437,000 on firearms training.
- Traffic Department. p 136 and p 84 of A-G report: Bitou has 29 traffic employees and spent R900,000 (plus another R525,000 in July-Sept. 2020) on uniforms! That equates to roughly R50,000 per employee! Revenue from fines was down R35 million because of the nine-month delay in hiring a service provider. As a result, the number of fines issued dropped from 715,489 to just 3,721 last year. The Auditor-General did an audit and reported fines by traffic officers were issued but not recorded, and cash from fines was being collected but not deposited in Bitou’s coffers. We call for an investigation into the Traffic department and disciplinary steps be taken against those who caused the R35 million loss of revenue to the municipality and that they be held accountable.
- Laptops. p 154 Laptop replacement for R200,000. At R6,000 per laptop you get roughly 300 laptops. Bitou has a total of 560 employees and the lifespan of a laptop has to be at least four years. The budget for next year calls for R2.2 million to be spent on laptops. There has to be an urgent in-depth investigation into this.
- Senior Managers’ Employment Costs. p 181 Senior managers’ employment costs increased 50% in 2019/20 over 2018/19. In spite of poor debt collection, lack of management controls, and out of control overtime, performance bonuses in the amount of R764,000 were paid. Other benefits totaling R1,5 million were generously given — please provide details of what the benefits were. Ms. Mbelane, who was on suspension for almost two years for financial misconduct, was paid a R56,000 bonus on her way out. (pg 85) ALL senior managers’ salaries are required to be reported in the Annual Report, yet there is no entry for Mr. Gericke, Mr. Groenewald, Mr. Esau, Mr. Sakati, etc. Please provide full disclosure as required.
- Other Municipal Staff. p 181 and p 85 of A-G report. The category of “Other municipal staff” remuneration increased 42% last year. Unspecified benefits and allowances totaled R37.5 million; please provide details. Plus R4.8 million for stand by allowance; R9.8 million for annual bonuses. R10.8 million for 13th cheques.
- Overtime Expenditure. p 181 Overtime expenditure was R17.8 million — even though it was supposed to be capped at R13 million…that is R32,000 per employee! We accept overtime for essential services, but what is the justification for the others? The office of the mayor, speaker, deputy mayor and MM was reported as 30% over budget on overtime. What is their department paying overtime for? The Auditor-General reported that R157,765 salary payment for “time not worked” was paid to Manfred Van Rooyen who works in the mayor’s office. What disciplinary action and what steps were taken to recover the money? We call for an audit on all overtime payments.
- Irregular Expenditure. p 95 of A-G report reports R305 million in Unauthorized Expenditure. Fruitless & Wasteful expenditure increased to R4.36 million from R0.65 million the year prior. R182 million in Irregular Expenditure. The Municipal Public Accounts Committee (MPAC) is instructed every quarter to investigate but does nothing. Municipal employees act with impunity; there are no controls, no consequence management. Hundreds of millions in Irregular Expenditure have not been addressed by MPAC nor the Council. This issue needs to be dealt with as a matter of urgency in order to recover what is recoverable, and the necessary disciplinary and legal action must be instituted.
- Financial Disclosure of Business Interests. p 105 of A-G report. Councillors and employees are required to disclose directorships or ownership in companies. It is of concern to see that a councillor serves as a director on eight companies’ boards and we question whether under those circumstances the person is able to give sufficient time to being a councillor.
- Tariff Increase. It is of concern that the increase in tariffs is in excess of the CPI. In general, the wasteful expenditure is totally unacceptable and has to be stopped.