Umzinyathi District Municipality received an adverse opinion from the auditor general for their 2021/22 financial statements and was found to have raked up R875-million in unauthorized expenditure.
Fruitless and wasteful expenditure for the year was put at R31-million. The auditor general describes the District Municipality’s as having ‘an unfavourable financial health that requires intervention’.
Water distribution losses for the year total R26-million while 77% of the budget will pay for expenditure of previous years.
It was found that there is a lack of record keeping at the municipality to trace evidence of processed transactions. The free basic services for the year of R26-million were incorrectly calculated as the wrong tariffs were used.
It was found that reasonable steps were not taken to prevent irregular expenditure as required by legislation – the majority of this irregular expenditure was caused by procurement processes not being followed.
The disaster management centre, built at a cost of over R50-million prior to 2014, adjacent to the Dundee airfield, has never been occupied.
Despite boasting state-of-the-art fittings, vagrants had moved into the building at one point.
The centre was never finished because several hired contractors hired failed to do so. An independent consulting firm conducted an official investigation on supply chain irregularities related to the center’s construction from 2014 to 2018.
The auditor general’s report says, previously the final report on the outcome of the investigation was tabled to the council but the recommendations of the investigation were not implemented.
*Umzinyathi District Council was contacted to respond to the AG’s findings. This will be published once it has been received.
