Ekurhuleni’s financial ‘bad state’ sparks political wrangling

Amid the stand-off between the Auditor-General South Africa (Agsa) and the cash-strapped City of Ekurhuleni over the release of the metro’s 2022-23 audit report, ActionSA has painted a gloomy picture of the city being plagued by poor service delivery and owing creditors R4 billion.

With ActionSA Ekurhuleni caucus leader Siyanda Makhubo having implored Gauteng cooperative governance and traditional affairs MEC Mzi Khumalo to intervene, it has emerged that the metro was in dispute with Agsa over the report.

Agsa deni delayed release

Agsa has denied claims by finance MMC Nkululeko Dunga that it delayed the release of Ekurhuleni’s audit report, saying it “noted the unfortunate and misleading public statements”.

“Agsa confirms it had completed the metro’s audit on time. However, the municipality has raised a dispute with the national audit office regarding their audit outcome for the 2022-23 financial year, which caused the delay in tabling the report.

“The matter is being handled by the two parties in line with Agsa’s long-standing dispute resolution processes.

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“For many years, we have used these processes to settle audit disputes in a fair manner, as guided by the Public Audit Act and the International Standards on Auditing,” said the Agsa.

Agsa’s position of city finances ‘politically motivated’

In his capacity as Economic Freedom Fighters (EFF) Gauteng chair, Dunga said he believed the audit institution’s position on the city’s finances was “politically motivated – something Agsa is not known for”.

“Agsa appears to be struggling with the fact that the city – the only municipality whose finances are in the capable government led by the EFF – are in order, with sound financial oversight and intact systems to ensure that taxpayers’ money is used for maximum service delivery,” said Dunga.

Asked by The Citizen to respond to allegations on social media that he “looted millions from the municipality”, having allegedly purchased expensive cars and homes for girlfriends, Dunga said it was “sad when we have to respond to social media platforms of parody accounts”.

Portraying a “messy state” of the city finances, Makhubo said: “It is becoming apparent that the ANC-EFF coalition government, led by the hapless mayor, Sivuyile Ngodwana, has led Ekurhuleni to the brink of being placed under administration for failure to pay creditors on time.

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“In October 2023, ActionSA successfully petitioned the speaker to call an extraordinary council meeting – to debate the state of the city’s finances.

“ActionSA expressed its concerns over service delivery failures, largely caused by the city’s inability to pay service providers,” said Makhubo.

Ekurhuleni creditors

Ekurhuleni creditors included Eskom (owed R1.5 billion), ERWAT (R117 million), Outsourced Contractors (R2.5 billion) and Rand Water (R174 million).

Makhubo said ActionSA would “continue to use avenues available to ensure that those who have led this city into the brink of collapse are held to account”.

He said failure to table the city’s 2022-23 annual financial statement, reflected “a lack of accountability and adherence to legal requirements – as outlined in the Public Finance Management Act”.

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