Following the Executive Council’s decision to release R70 million to assist the financially troubled Modimolle-Mookgophong Municipality to continue with business and acquire basic services, the municipality still needs over R300 million to settle all its debts to become financially viable.
This was revealed by Mayor Marlene van Staden who stated that the under-administration municipality owes creditors over R400 million with the biggest debt being R300 million owed to Eskom. She stressed that the municipality had inherited 90% of the debt from the former Mookgophong and Modimolle municipalities. The Provincial Government has released about R41 million thus far that will be paid to different creditors, she explained. Van Staden highlighted that the money is not going to be deposited in the municipal account but be administrated by the Department of Cooperative Governance, Human Settlements and Traditional Affairs.
“I don’t want to take any chances with the money. I want it to be spent appropriately and all I request from the department is proof of payments made to various creditors. The rest of the money will be released as soon as we have decided which critical creditors to pay. We are going to prioritise service providers such as people who assist the municipality with basic services that include water, electricity and maintenance,” she stated.
According to Van Staden, R10 million will be paid to Eskom, R5,9 to Magalies Water Board, R6,4 to South African Revenue Services, R5 million to the office of the Auditor-General and a ‘couple of million’ will go to the municipal fleet and the Sherriff. She expressed confidence that the municipality would be financially viable again but only if relevant stakeholders and ward councillors can come on board and educate communities about the importance of paying municipal tariffs for the municipality to collect enough revenue which will ensure business continuity and service delivery.
The financially distressed municipality, governed by a Democratic Alliance-Economic Freedom Fighters coalition was placed under administration earlier this year. Last Thursday, Provincial Government Spokesperson Phuti Seloba indicated that the money was released after the municipal council had agreed to adopt a resolution on the institution of forensic investigation into the alleged corruption and mismanagement in the municipality. He further said the forensic audit has commenced and once completed would guide them in taking the appropriate steps.
Story: ENDY SENYATSI
>>endy@observer.co.za
