The ongoing provincial financial mismanagement in the Eastern Cape continues to have an adverse effect on the smooth running of municipalities. Up to 31 January 2010 several municipalities within the province was owed money by provincial and national departments.

A motion will be tabled by the Democratic Alliance in the Bhisho Legislature yesterday (subs: Tues, 23 Feb) that all outstanding money owed to municipalities by the government be paid in full by the end of the financial year (31 March 2010).

When the province withholds money due to municipalities, it has an extremely adverse effect on their financial viability. This sometimes results in cash strapped municipalities having to divert other resources to cover the shortfall caused by the province.

This is extremely frustrating when one has to spend hours of one’s time fighting the bureaucratic monster that Bhisho has become. It is detrimental to the morale and motivation of employees of municipalities who already have their backs to the wall when it comes to trying to improve service delivery.

A recent case in point was the Baviaans-municipality, who had to wait nine months for the provincial Education Department to pay an amount of R240 000 for services rendered. The Health Department took seven month to pay R112 000.

This matter was brought to the attention of the DA in Bhisho and after letters, a question for oral reply and personal meetings with various MECs, the money was finally paid.

For small municipalities amounts such as these are extremely important and without it they cannot function effectively. In the end, it is the people on the ground, who need service delivery, that are badly affected.

In the new financial year budget increases in the municipalities in the province in real terms are not going to amount to very much. This means cash flow management is going to take on even greater critical importance.

The motion will call for:

a) a report highlighting all outstanding monies owed by both provincial and national governments be tabled at the next sittings of the Finance and Local Government Portfolio Committees;

b) all monies owed from provincial departments and national departments in the province be paid in full by end of the 2009/10 financial year;

c) all MEC’s to follow up with their national cabinet colleagues to expedite payment to municipalities owed monies by national departments.

d) all MEC’s to investigate whether interest accrued in their departments as a result of late payment is fruitless and wasteful expenditure and report this as well as causes for delayed payments and disciplinary steps against officials (if applicable) and table these reports at the next meeting of the Finance and Local Government Portfolio Committees.

For further information, please contact Dacre Haddon, MPL on 079 694 3788

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