BY Site Admin

Kouga Municipality owes the Nelson Mandela Bay Metro, according to Mayor Wayile, in excess of R25,5 million  for water which the former municipality purchases from the Metro (EC Herald 23/01/13).

The Democratic Alliance councillors in both Kouga and the NMBM  are fully aware of the acknowledgement of debt signed by the Kouga chief financial officer (CFO) in September 2011 when Kouga agreed to pay off R500,000 per month to cover the debt plus the amount for the current consumption.  At the time, the DA in the NMBM calculated that it could at the water usage rate of Kouga at the time, take more than 4 years to pay off the debt and get the current balance back on the 30 day system as prescribed by the Municipal Finance Management Act.

On 4 May 2012, a Kouga DA delegation met with MEC Mlibo Qoboshiyane to discuss Kouga’s outstanding debt at the time, which as at 3 May amounted to R123 .278 million.  The NMBM water debt balance on 3 May 2012  was R24 million.  The full report by the MEC is attached here.

The statement by Randall, municipal spokesperson for Kouga, is correct if she calculated the 16 months being the term to date of the acknowledgement of debt where Kouga paid off R500,000 each month.  BUT why is there no decrease in the debt from 3 May 2012 until December 2012?

The problem is that the Kouga mayoral committee does not submit any financial statements to the finance portfolio committee.  They first want to process it under the blanket in a mayoral committee meeting before it is referred to a portfolio committee months later or displayed in the quarterly reports at a council meeting.

The Kouga mayor so easily refers to the debt as “inherited from a previous regime”, but what he neglects to say is that the previous regime before the 2011 elections was also an ANC regime and the finance chairperson was Cllr Vernon Stuurman for the period before the elections and still holds the same position after the elections.  So this Stuurman/ANC regime is completely responsible for the dreadful financial woes of Kouga Municipality.

The request that NMBM must write off the interest on the loan is ridiculous.  The NMBM also has financial difficulties and have to pay interest on loans and overdrafts.  This amount of bank or loan interest in the Metro must then be paid by the residents of the Metro… how unfair.

These outstanding debtor accounts of Kouga municipality should never have existed if there was proper financial administration.

The DA fully supports ANC Mayor Wayile of the NMBM in approaching Finance Minister Pravin Gordhan and national Treasury to intervene.

I will also write to Minister Pravin Gordan, Mr Terence Nombembe the Auditor General, as well as the Auditor General in the Eastern Cape to address the various financial issues in Kouga.  The MEC for local government, Hon Mlibo Qhobshiyane will also be informed of the situation and will be requested to reconsider the Section 154 intervention he implemented in Kouga as it clearly is not conducive to an improved financial status in the Kouga administration.

The taxpayers cannot afford to allow their hard earned monies to be squandered by irresponsible financial administration.

 January 23, 2013
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