Report back to MembersFebruary 17, 2023
AGENDA FOR AGM ON 29 MARCH 2023March 24, 2023
The Annual Report is an accountability tool to assess the effect of the Municipality and the impact it had on the communities and residents. It is not only an overview of our financial affairs, the administration and governance, but it provides a synopsis of the successes achieved and challenges experienced. It covers the financial year from 1 July 2021 to 30 June 2022. Below is our letter to Council with our oversight report. The link to the Draft Annual Report can be found at the bottom of our report.
27 February 2023
Dear Bitou Councillors,
Oversight Report on the 2021/2022 Draft Annual Report.
It is our understanding that the purpose of the Annual Report process is to report on the executive management of the municipality 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 Bitou’s reporting in the Annual Report continues to deteriorate every year. Sections are omitted, and there are no explanations for declining results.
We would like to know what the consequences will be for this 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?
We ask you to respond with the requested information, initiate the investigations and take corrective actions.
Councillor Kolwapi is copied in her twin role as MPAC chairman and councillor.
cc: Municipal Manager Memani
PLETT RATEPAYERS’ OVERSIGHT REPORT FOR DRAFT 2021-2022 ANNUAL REPORT
1. page 22 “Water losses increased significantly in 2022.” Losses are reported in the Audited Financial Statements (AFS) as R6.9 million, increased from R4.3 m the year before. The Annual Report (AR) says R5-10 million pa is needed for maintenance to avoid pipe breaks and bursts. How much is spent on overtime to fix the problems due to lack of maintenance? What is the plan of action to reduce water losses?
2. page 24 and 114 The number of households with access to basic services (billed) shrunk in 2021/22 in all categories. WHY? Is the municipality not able to keep up with providing services to the growing population?
3. page 38 This section says ward committee meetings should be held every two months, but another sentence says quarterly. Which is it? The rules state that members are paid only if they attend the meeting. Please include the attendance record of all the members for the year and what they were paid.
4. page 87 The functions of a municipality are listed. Why is BM spending money on education, such as bursaries, classroom expansion, etc., which are not municipal responsibilities, rather than prioritising spending on service delivery which IS a municipal responsibility?
5. page 112 The number of households in formal settlements declined from 80% to 71%. Please explain the reason for this decline.
6. page 114 Bitou was 279% over budget on expenditure for the solid waste department; the budget being R18.7 million as near as we can figure. Ratepayers will not be content to pay big tariff increases when no effort is made to improve efficiencies of the department, nor to avoid wasteful expense. What is being done to fix the problems and cost overruns? Building a berm for R1 million to hide the transfer station is NOT going to fix the increasing amount and cost of waste that is accumulating.
7. page 121 Please explain the high cost of new services for Ebenezer housing development in New Horizons. R3.1 million was budgeted for new roads, yet R22.5 million was spent. R1.5 million was budgeted for sewers, but R5 million was spent. How much has been spent on Ebenezer to date? It is well over R150 million, for a development of 200 units, and the top structures are not even built yet. That is over R750,000 per unit. This needs an investigation.
8. page 131 Plett Tourism spent R124,000 on mapping a cycle route. Was an investigation done on why this cost so much, when it could have been done on a desktop or by cyclist volunteers?
9. page 142 What is the justification of buying a new vehicle rather than fixing the three that are waiting for repairs?
10. page 154 R1.8 million was spent on the Qolweni Cultural Village, plus another R1.4 m mentioned in the Audited Financial Statements (AFS). Please indicate how many visitors it has had, what tours it provides, what are its hours, etc.
11. page 160 R580,000 was spent on laptop replacements. Not for new employees, but replacements for existing laptop users. Is it the same people who receive replacements over and over? Is anyone held responsible for their loss? What was the expenditure on new laptops? This needs an investigation.
12. page 162 How much was spent in 2021/22 for legal services? Please show the trend in comparison to 2020/21 and 2019/2020.
13. page 163 of AR and pg 6 of AFS Please include the figure for unauthorized and irregular expenditure, and compare it to the prior two years. Bitou wrote off R94 million in bad debt, which means the revenue budget was over-stated by that huge amount. Was expenditure adjusted accordingly as debt was written off?
14. page 165 R19,400 was spent on a heavy-duty paper shredder. Aren’t all communications required to be kept by the Records Department? Why not recycle it? Why are documents being shredded? Everything is supposed to be public.
15. page 183 Are the 28 non-permanent employees “political appointees” who are hired by the politicians and work for them? If so, what do they cost the ratepayers? We have asked many times and not been answered. Please publish the coalition agreements as promised.
16. page 186 The figures show that sick leave increased from 3,077 days in 2020/21 to 4,601 days in 2021/22. What is being done about it?
17. Please ask HR to provide the cost of EPWP workers, including the cost of uniforms, transport, cost of admin for hiring, paying, supervising, etc. How much was funded by a grant versus by the municipality?
18. page 193 Overtime increased from R17.8 million to R20.9 million in 21/22. What is being done about it? Please list the departments who are approving overtime, the amounts, and compare it to the last two years. Call for a council resolution to stop non-essential overtime payments. Publish the consequence for non-compliance. Council needs to instil discipline and not treat it as an entitlement.
19. page 214 We note that the liquidity ratio decreased from .45% in 20/21 to .31% in 21/22. (a higher ratio is better and indicates the municipality’s ability to pay its bills.) Have any financial controls been put in place or cost reductions to stop this deterioration?
Audited Financial Statement (AFS)
20. page 82 Bonuses in the amount of R7 million were paid, even though the financial health of Plett was declining and delivery of services was deteriorating. The APAC report says: Quarterly performance targets were not achieved, and inaccurate performance was reported. Which managers received bonuses and how much did each receive?
21. R5.6 million was spent on standby allowances, including office staff who had no reason to be on standby, such as Supply Chain Management, Revenue Dept., etc. (source: July 2022 Virement Report). Please provide the justification for this expenditure.
22. page 95 How much is the municipality spending on the cost of bodyguards for the speaker and deputy mayor? Why do they need bodyguards? Has it been approved by SAPS?
23. R2.4 million was spent on clothing and uniforms for municipal employees. Perhaps this needs an investigation?
24. Why did the cost of local travel double to almost half a million rand? Is it measured by municipal fuel card expenditure? What was the outcome of the investigation into fuel card fraud? Are municipal employees being allowed to take municipal vehicles out of the area for personal travel?
25. page 110 Irregular expenditure increased from R182 million to R226 million. What is being done to reduce this unlawful expenditure, and who has been held accountable? How much has been recovered?
26. page 115 Ex-councillor Mbali had a personal interest in R6.5 million of tenders. Was this investigated to ensure Bitou received value for money for those tenders?
27. page 116 The report states that Mr. Gericke, Director of Economic Planning and Town Planning, had municipal arrears of R43,736 as of 30 June 2022. Why was this not garnished from his paycheck, as required by the MFMA? What are his current outstanding arrears? Please report all staff and councillor arrears by NAME, not employee number, in monthly financial reports.
The following Information has been omitted from this year’s annual report and needs to be included:
list disciplinary hearings – employees’ name, outcome, and disciplinary action
list the legal cases which are outstanding
list managers’ salaries who report to the MM, in addition to the heads of department, per MFMA.
Below is the link to the 31 January 2023 council agenda containing the draft annual report.