The speech below was delivered by Tim Brauteseth, MPL during a debate on the MK Party Motion in the KZN Legislature today
The Auditor-General’s (AGSA) 2023/24 Municipal Finance Management (MFMA) report paints a sobering picture of municipal governance in South Africa. While there are glimmers of progress, the overall message is clear: Municipalities are failing to deliver on their mandates and the consequences are being felt most acutely by our citizens who rely on basic services.
Two issues stand out starkly in this year’s report – the ineffective use of financial consultants and the troubling disconnect between budget expenditure and actual performance outcomes.
Municipalities spent a staggering R220 million on consultants in the 2023/24 financial year. This would be justifiable if it led to improved financial management, skills development and long-term sustainability – but the reality is far from that. The AGSA found that consultants were often brought in to perform basic functions that should be handled internally – and worse, there was no evidence of skills transfer or capacity building. In many cases, the same consultants are rehired year after year, creating a cycle of dependency that drains public funds without building institutional resilience.
This is not just a waste of money – it is a missed opportunity.
South Africa’s municipalities are in desperate need of skilled financial professionals. Instead of investing in training and retaining talent, municipalities are outsourcing their responsibilities, often with little oversight or accountability. The result? Poor-quality financial statements, weak internal controls and a growing trust deficit between government and the people.
Equally concerning is the mismatch between what municipalities spend and what they achieve. The AGSA report reveals that many municipalities spent more than 90% of their budgets – yet failed to meet even half of their service delivery targets. Glaring examples in KZN include:
- The Harry Gwala District municipality which spent 100% of its budget but achieved only 32% of its performance targets
- Amajuba District municipality which spent 120% of its budget with a 54% return and;
- uMzinyathi District, which takes the cake, with expenditure of 113% yielding only 20%.
This is not just inefficiency – it is a betrayal of public trust.
The root causes are well-known: poor planning, weak project management and a lack of consequence management. Infrastructure projects are delayed or abandoned, maintenance is neglected and procurement processes are riddled with irregularities. The result is a steady decline in the quality of basic services – from water and sanitation to electricity and waste management.
The AGSA’s findings are not new. Year after year, the same issues are raised, yet little changes. What is missing is political will. Municipal leaders must be held accountable for financial mismanagement and service delivery failures. Oversight bodies must act decisively when irregularities are identified. And national and provincial governments must provide the support – and the pressure – needed to turn things around.
A further issue relates to the constitutional set up in South Africa. Following engagements with the AG on the MFMA report, the DA requested a legal opinion on whether SCOPA – and by extension the CoGTA portfolio committee – can directly call municipalities to account in the provincial Legislature. This, after all, speaks directly to the action called for in the MKP motion.
The short version of a 15-page legal opinion is that ‘whilst national legislation does permit provincial administrations to exercise certain monitoring and support functions in relation to Municipalities, these do not vest with the KZN Legislature and reside exclusively with the Provincial Executive. The exercise of oversight will therefore need to be performed through the provincial department responsible for providing monitoring and support to municipalities.’
This speaks directly to Section 47 of the Municipal Systems Act which compels the MEC for COGTA to provide an annual report to the Legislature on the performance of municipalities. Similarly, Section 132 of the MFMA compels municipalities to submit their annual financial reports to the Legislature. Finally, the MFMA allows Provincial Treasury to play a hands-on role with municipalities in areas such as financial health, compliance, intervention on non-compliance, budgeting support, financial management support, supply chain management and capacity building.
MEC Rodgers has spoken of a dashboard for provincial department performance. Perhaps a municipal performance dashboard should also be considered?
While the DA fully agrees with the MKP’s desire to haul delinquent Mayors and Municipal Managers (MMs) to committee interrogations, they are complaining to the wrong manager. In essence, provincial government’s focus must be on holding COGTA and Treasury to account to ensure that they, in turn, hold municipalities to account.
But accountability is only part of the solution. A shift in mindset is also needed. Municipalities must move away from a culture of compliance and box-ticking and toward a culture of performance and results. Budgets must be linked to measurable outcomes. Consultants must be used strategically, with clear terms of reference and mandatory skills transfer. And communities must be empowered to hold their leaders accountable.
KZN is fortunate to have the DA as a partner in the Government of Provincial Unity (GPU). With a proven track record of excellence in numerous municipalities around the country and here at home in uMngeni, the DA is ideally placed to lead the GPU in correcting the course of governance in these ailing municipalities.
The AGSA’s report is a wake-up call – not only for KZN – but for South Africa as a whole. Government cannot afford to continue down this path. If it is serious about building a capable and ethical state, it has to start with our municipalities. They are the frontline of service delivery – and they are failing. The time for excuses is over – it’s time for action.