UMHLATHUZE City officials will have to answer why only 15.78% of the capital expenditure – money urgently earmarked for service delivery – was spent as of 31 December 2013.
Out of the R338.7 million budgeted for 2013/2014, only R53.4 million had been utilised at the end of the second quarter of the financial year.
And the severe underspending was not taken lightly as City Mayor Elphas Mbatha called on Municipal Manager, NJ Sibeko on Tuesday to submit a detailed report at the next Council sitting on the causes of the low capital budget spending.
‘We need to know how departments are represented on bid committees, the processes followed and challenges experienced as well as the objections and court applications faced by Council,’ said Mbatha at the Executive Committee meeting in Richards Bay.
Exco Councillor Dumisani Nxumalo said the slow spending was a serious concern and did not bode well for the future of the municipality.
‘Is there a shortage of staff or lack of capacity? What is the problem? If we keep quiet, it would look as if we support this 15.58% spending. What measures will be put in place to correct this? June is around the corner and processes of the next budget will commence soon,’ said Nxumalo.
‘The slow spending is not good. Between November and December, there was only more than 4% of the capital expenditure spent,’ said Cllr Beena Simmadhri.
Debtors
Concern was also raised about the number of debtors sitting in the over 90 days’ category totaling more than 75 million. More than R3 million was money owed by government, R29 million constituted business debt and 35 million – household debt.
‘KZN MEC for Finance Ina Cronje did indicate if there was a problem collecting money from government departments, we can forward her the list of departments and she can assist. This is a big concern to us when money is owed by government departments,’ said Deputy Mayor Cllr Vera Gumbi.
The Municipal Infrastructure Grant (MIG) funding of R64.7 million, which was at risk of being withdrawn for underspending, will now roll over to 2014 after approval by National Treasury.
This comes as Deputy Municipal Manager: Infrastructure and Technical Services, Sifiso Mdakane remains on suspension with full pay on allegations of misconduct for failure to exhaustively spend MIG funding for two consecutive years. The disciplinary tribunal is due to sit in February.
