For instance<\/a>, Eskom has noted that the city of Tshwane has consistently failed to pay its debts and, in the middle of June, claimed that the city owed R2 billion. <\/p>\n\n\n\nEskom has taken the matter to court and filed a founding affidavit before the North Gauteng High Court, which sought to immediately recover R1.6 billion in debt. <\/p>\n\n\n\n
The city is also battling a R4.7 billion-shaped hole in its fiscus due to the blundering of a smart meter contract by the previous administration in 2013. <\/p>\n\n\n\n
\u201cFor the entire duration of this contract, these payments were processed while no VAT was paid. In 2015, after a review of the contract, it was decided that it would be terminated,\u201d the city said.<\/p>\n\n\n\n
However, the termination of the contract was only initiated in 2019, with city officials claiming that the new administration was only made aware of the unpaid VAT liability when SARS made a claim for R2.9 billion. <\/p>\n\n\n\n
\u201cAlong with penalties and interest to the value of R1.8 billion\u2026SARS effectively slammed the city with a R4.7 billion liability,\u201d it said.<\/p>\n\n\n\n
Although the committee noted the city’s plans to improve its dire financial position, it said there is a lack of capacity and skills, particularly in strategic roles in the city.<\/p>\n\n\n\n
\u201cWe must be frank that the main challenge within the local sphere of government is the lack of appetite to implement effective consequence management, which then encourages a self-seeking culture of corruption and undermining of service delivery,\u201d said Mr China Dodovu, the Chairperson of the committee.<\/p>\n\n\n\n
The committee added that it was concerned that the municipality cannot fill crucial vacant positions, which are crucial for implementing its recovery plan, including the chief financial officer. <\/p>\n\n\n\n
However, the city said that recruitment is at an advanced stage, adding that it will make recommendations on candidates to the council by August. <\/p>\n\n\n\n
The committee added that it was concerned about the lack of visible progress in the implementation of the audit action plan. <\/p>\n\n\n\n
In January, a leaked report from the Auditor General gave the city an adverse audit opinion due to significant irregularities – such as R10.5 billion of irregular expenditure that was not accounted for. <\/p>\n\n\n\n
The committee said that the city has to improve the capacity of the teams delegated to implement the audit action plan to ensure observable progress. <\/p>\n\n\n\n
It also emphasised the need for the city to improve its financial management practices and internal controls, which can be achieved by hiring qualified Section 56 managers.<\/p>\n\n\n\n
People and the city must cough up <\/strong><\/p>\n\n\n\nFollowing engagements with critical stakeholders, like businesses, households and government, the committee said that the failure to establish ward councillors had hurt the city. <\/p>\n\n\n\n
It added that cash flow challenges faced by the city could be fixed if the city got residents to pay for services. <\/p>\n\n\n\n
“Effective communications anchored on effective ward committees is a necessary tool towards the attainment of this goal,” Dodovu said. <\/p>\n\n\n\n
It also supported programmes aimed at enforcing compliance and payment of services. <\/p>\n\n\n\n
“The support is based on the understanding that for the municipality to continue to deliver services, it requires improved cash flow, which is currently affected by non-payment from households, businesses and government departments,” he said. <\/p>\n\n\n\n
Moreover, Tshwane also spends far too little investment in infrastructure maintenance, increasing the chances of poor service delivery and losses. <\/p>\n\n\n\n
The city only spends 2% of its budget on maintenance, far below the national norm of 8%. <\/p>\n\n\n\n
Given the major water and electricity losses, the city maintaining its bulk infrastructure will guarantee that residents receive reliable water, roads and electricity.<\/p>\n\n\n\n
Moreover, the city was deemed overreliant on consultants and called for improved internal capacity to save money. Although consultants are sometimes necessary, the committee cautioned against abuse. <\/p>\n\n\n\n
\n\n\n\nRead<\/strong>: Eskom\u2019s key tool to stop stage 8 load shedding comes at a great cost to South Africa<\/a><\/p>\n\n\n\n<\/p>\n","protected":false},"excerpt":{"rendered":"
The city of Tshwane faces an uphill battle to sort out its finances, with the city desperately needing residents to pay for their services. <\/p>\n","protected":false},"author":95,"featured_media":659159,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23],"tags":[26],"class_list":["post-706502","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-government","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/706502","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/95"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=706502"}],"version-history":[{"count":5,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/706502\/revisions"}],"predecessor-version":[{"id":706576,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/706502\/revisions\/706576"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/659159"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=706502"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=706502"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=706502"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}