KAROO NEWS - Last week Cogta MEC Xolile Nqatha confirmed that he had approached national government for funds to bail out 14 bankrupt Eastern Cape municipalities, of which Dr Beyers Naudé Local Municipality (DBNLM) is one.
He also mentioned that provincial government was considering merging these failing municipalities with more successful ones. A move labelled utter madness by the DA.
In 2016 his predecessor, former Cogta MEC Fikile Xasa, amalgamated municipalities in distress with successful municipalities, which reduced the province's municipalities from 45 to 39. All those amalgamated municipalities from 2016 are on the new list of the 14 failing municipalities.
"Instead of improving service delivery, the failing municipalities that were amalgamated have dragged down the successful institutions they were merged with," said Vicky Knoetze, the DA's MPL Shadow MEC for Cogta.
"In 2016, despite numerous indications that the amalgamation of Ikwezi, Camdeboo and Baviaans Municipalities would be detrimental and unsustainable, the Minister of Cogta insisted that the amalgamation proceed," said constituency MP Samantha Graham-Maré of the DA on Monday.
"The biggest issue was the historical debt," she said. "The amalgamation grant was far too small, and did not make any provision for settling Eskom debt or monies owed to the Auditor-General."
Graham-Maré explained that the DBNLM debt continues to climb due to the inability to settle it, with soaring interest. "Our rates base is too small to meet the financial needs of the municipality, even if our collection rate was at 100%, which it is not," she said.
"The only way in which the DBNLM could become sustainable is if National Treasury increases the Equitable Share amount payable to the municipality, with historical debt written off so that the municipality could focus on current accounts and not the millions in old debt that they are struggling to service."
"Amalgamation is not the answer and will only amount to more suffering, and a complete failure in providing services to the people of the Eastern Cape," added Knoetze.
It was noted at the water summit in December that MEC Nqatha mentioned in passing that the financial struggles of the DBNLM had been noted, and that he did not rule out disestablishing the amalgamated municipality.
Graham-Maré also mentioned this, adding that the DA will look at various other proposals, including reversing the amalgamation, redrawing boundaries and writing off historical debt.
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