Among the Limpopo municipalities that allegedly spent R280m on financial consultants in the past auditing year, is the Fetakgomo Tubatse Local Municipality (FTLM) in Burgersfort.
The Auditor-General’s (AG) report has revealed that 15 municipalities in Limpopo, including the FTLM, paid a total of R280m to consultants whose work was ultimately ineffective.
The South African Local Government Association’s (Salga) Limpopo chairperson for municipal finance and fiscal policy, Mamedupi Teffo, said the expenditure on consultants demonstrates massive skills shortages on local government level in Limpopo, which spends the most on consultants out of all the provinces in the country.
According to the AG’s report, the FTLM has splashed R36.6m to financial consultants, the second-highest spend in the province, to prepare its statements and help officials manage its assets. However, the AG found these consultants hired by the FTLM to have been ineffective.
Teffo said money allocated for service delivery is constantly diverted to paying consultants, which perpetuates overreliance on them without the transfer of skills. “The financial consultants are expected to render their skills and also educate municipal employees so that we can do away with consultants in future. It’s a huge concern that the AG’s findings also discovered that the consultants were not effective.”
She said Salga would engage with Limpopo municipalities, provide technical support and guide them to reduce their overreliance on financial consultants in order to improve service delivery.
This publication forwarded queries to the municipal spokesperson, Mahlaku Komane, concerning the R36.6m figure. Komane had not yet responded by the time of going to press.
Speaking about the Limpopo municipalities, the AG, Tsakani Maluleke, said: “The amount that municipalities spent on consultants continued to increase, and most municipalities relied on consultants to prepare and/or review their financial statements because they did not have enough skilled resources in their finance units. Consultant costs for financial reporting increased by 6% to R279.87m. Despite the high spend on financial reporting consultants, the investment has not had the desired impact, as these municipalities’ audit outcomes remained largely unchanged. It is also not evident whether the consultants transferred any skills to the municipal staff.”
Maluleke said that the provincial treasury and the co-operative governance, human settlements and traditional affairs department, supported by the premier’s office, committed to help these municipalities reduce their use of consultants last year, but this support has not yet materialised.
