On Tuesday, the Gauteng MEC for Finance and e-Government, Ms Nomantu Nkomo-Ralehoko, in- formed the municipal council during a zoom meeting that Merafong was one of 43 municipalities in the country where urgent intervention was needed because of their dismal financial state.
The intervention follows a test case last year in which the Gauteng High Court ordered the national government to intervene in Lekwa Local Municipality in Mpumalanga and for the National Treasury to prepare a financial recovery plan to be approved within six months of the court order. Astral Operations Limited won this important case against the government, forcing them to act against poorly run municipalities like Merafong.
This intervention into the municipality’s affairs is according to Section 139 of the Constitution.
The MEC told councillors that Merafong is in a financial crisis because it fails to pay its debtors on time, its debt to Eskom and Rand Water is very high, and its 2021/22 budget is unfunded by a significant amount.
Although Merafong has a payment plan with Rand Water and Eskom, it does not honour its commitment.
Meanwhile, the municipality’s adopted budget was also assessed and found to have been unfunded for the past five years.
Among other things, the MEC pointed out that Merafong has not spent the grants allocated to it efficiently and effectively. It only spent 65.5 per cent of the money it received from the 2016/17 financial year. 2020/21 had the lowest spending of 48.9 per cent.
Due to these issues, the provincial government now expects councillors to play a greater role in sorting out the problems.
Province also recommended that more oversight committees are established.
One of these is a technical war room committee that meets monthly to deliberate on progress. Its participants should include relevant officials from the municipality and representatives from various provincial and national government departments.
There must also be a political oversight committee that must meet with the Premier and relevant MECs quarterly to review the interventions.
According to Section 139 (c) of the Constitution, the provincial government may dissolve the council and appoint an administrator and a team of experts to run the municipality if the recommendations are not adhered to and its financial state does not improve.
The councillors were inducted on the legislation and processes of the intervention via an online presentation.
Together with the mayor, they will now be expected to play the role of the coach on a sports field, guiding the players (the municipal administration) while the referee (the national and provincial government) monitors whether everything is going according to plan.
