KAROO NEWS - In a damning report last Wednesday, auditor-general (AG) Kimi Makwetu expressed grave concern about over R24-million of drought aid to the Dr Beyers Naude Local Municipality (DBNLM) that cannot be accounted for.
Makwetu said he could not determine what the money was spent on, as no records had been kept by the municipality for the period under review.
R30-million for drought relief
In April 2019 it was announced with great fanfare that an amount of R30-million had been allocated to the municipality. This was after it had submitted an application to the Department of Cooperative Governance and Traditional Affairs (CoGTA) under Disaster Management to assist with water problems experienced during the drought.
Half of this, a massive R15-million, was for an emergency water supply scheme for Graaff-Reinet, with an additional R300 000 to improve the performance of the filters at the Waste Treatment Works, and R400 000 for the incremental development of an aquifer system for groundwater development in the town.
Over R6-million was provided to install water meters throughout the municipal area, including the former Ikwezi, where there were no meters at all. The remainder of the money was to be spent on replacing water mains in Jansenville that can no longer be repaired (R450 000), refurbishing existing boreholes in Steytlerville (just over R2.4 million), and the final R1.5-million was for future groundwater development in Rietbron.
The auditor-general's report
The unauthorised spending of about 80% of this drought aid was one of the reasons for the municipality receiving a disclaimer audit report for the 2018/2019 financial year.
At that year-end, the AG found that over R24-million was supposedly on the books still from the drought aid, but this amount was not cash-backed as the municipality did not have cash reserves of R24-million in their bank account.
"A rollover application was made in June 2019 for the R24-million, even though the money had been spent," said Makwetu. He added that this R24-million had been recorded as an unspent conditional grant in the financial statements.
"This means that the unspent grant money was spent on expenses not relating to the drought relief," he concluded.
Concerns of the forum
The Graaff-Reinet Economic Development Forum has worked closely with the municipality through the joint operations committee to address the challenges of the drought. Chairman Derek Light is concerned and wrote to the mayor on Tuesday to demand his response to the findings of the AG. "We are partnering with the municipality, but cannot do this if there is irregular expenditure, or no trust," said Light. "We find it very disturbing that the municipality has remained silent for so long, knowing these discrepancies." He added that the mayor's response will determine the future of the forum's relationship with the municipality.
Community reaction
Residents of Graaff-Reinet and the surrounding towns were horrified and disappointed to hear of the irregularities, with some acknowledging that this only confirmed their suspicions.
"It seems that DBNLM management has not told the truth about this R25-million," said Graaff-Reinet resident Liz Buisman. "It should have been in the DBNLM bank account at the end of 2018/19 financial year -it was not and the AG could not find proof of how it had been spent." Buisman feels strongly that the municipality must be held accountable. One local anti-corruption activist said that he heard rumours last year that R15-million of the drought money had already been spent. He suspected that the money might have been spent as a down payment to Eskom, as at that time, the municipality owed Eskom R91-million, and the power utility was threatening to switch power to the town off. He feels that the AG's report has confirmed his suspicions.
"Did any normal accounting practices take place in the finance department offices of the municipality?" questioned Kroonvale resident and local teacher Mervin Mackelina. "Where are the source documents as evidence of transactions taking place, for the auditors to work with?"
No cash at the end of April
According to a reliable source who did not want to be named, in the new financial year (19/20) R16-million was spent on drought relief projects out of the new allocations. Coming to the end of the financial year 2019/20, R8-million was still to be spent on drought relief projects but again at the end of April, there was no cash in the bank for the completion of those projects.
Municipality fails to respond
The Advertiser asked the municipality if the rollover money had been spent in the financial year 2019/2020, and if there was money to pay the contractors implementing the drought relief projects as at 30 June.
Allegations that the relief money has been used illegally to pay creditors, including Eskom, and salaries, were also put to the municipal manager and the mayor.
"After consultation with the municipal manager, I have been informed that the municipality reserves comment on queries," replied Edwardine Abader, acting spokesperson. "This lack of response is not acceptable, and should be reported to the COGTA MEC — municipalities should be obliged to communicate with their stakeholders," said one irate councillor.
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