KDM gets eighth ‘pass’ from AG

Despite being named South Africa’s most financially sustainable municipality for the second consecutive year, KwaDukuza is still falling just short of a clean financial audit opinion.
KwaDukuza municipality (KDM) received its eighth consecutive unqualified audit opinion (2012/2013) with matters of emphasis at a full council meeting on Thursday, January 30.
In its 2011/2012 audit report KDM was reprimanded for irregular expenditure, deviation from the supply chain management policy and failing to achieve project objectives.
It seems to be more of the same this year, with R233,66m material underspend on the capital budget (double the R122m in 2011/2012), material losses and failure to meet pre-determined service delivery objectives cropping up again.
The AG also found that reasonable steps were not taken to prevent irregular expenditure, certain reported information was not viable and annual financial statements had to be corrected in order to grant an unqualified opinion.
Material losses of 74,71 million kilowatts – amounting to R46,12m – were incurred as a result of electricity distribution losses.
According the AG’s report: “Irregular and fruitless and wasteful expenditure incurred by the municipality was not investigated to determine if any person is liable… the accounting officer, management and municipal council did not exercise oversight responsibility over the annual performance report.
Investigations into various allegations of financial misconduct against municipal officials are also underway.
Speaking for the office of the auditor general in KwaZulu-Natal, deputy business executive Indran Perumal stressed that KDM must strive to strike the matters of emphasis off its record.
“If you are serious about getting a clean audit then it must be a team effort,” he said.
Mayor Ricardo Mthembu applauded council on the report and declared they would achieve the AG’s target of a clean audit by the end of the 2014 financial year.
The leading and opposition political parties are usually allowed to comment on the draft annual report and audit opinion but chief whip Dumisani Ndimande suggested to speaker Thulani Khuluse that the report be sent to portfolio committees for discussion and comment.
Dolphin Coast Residents and Ratepayer’s Association (Docrra) chairman Louis Luyt jnr asked permission to comment. However Khuluse told him members of the public are allowed to attend council meetings but “not necessarily allowed to make a comment”.
Luyt asked when he would be allowed to comment, insisting he would get no response from the municipality otherwise.
“I am closing this item and it is not up for debate. There will be no discussion with the public. You may speak to the municipal manager after the meeting,” was Khuluse’s response.
Before he left Luyt asked for an opportunity to address council formally, at which ANC councillors began heckling him.
He later told the Courier that Docrra would attach a supplementary affidavit to the documents they have already sent to the public protector.
“There is no way that audit report can be allowed. We are not allowed to voice our opinions so there is no point. Discrepancies are being swept under the carpet, with the speaker behaving like a dictator. Municipal officials need to step up!”
Councillors were also denied permission to comment. During the meeting Democratic Alliance chief whip Madhun Sing accused Khuluse of oppressing the opposition, saying councillors are well within their rights to comment.
Khuluse responded by telling councillors to “put their hands down and behave”.
Attempts to reach him for comment were unsuccessful at the time of going to press. The public may view the report at the KDM offices, library or online at www.kwadukuza.gov.za