The DA in Abaqulusi Local Municipality has written to the Chairperson of Finance, Mayor Sifiso Eric Mkhwanazi, registering an objection to a proposed budget adjustment of R323.4 million, that the municipality anticipated to finance through a long-term loan.
We believe this will cause more financial burden to both the municipality and residents. While we all want roads to be fixed, proper planning and budgeting is required.
AbaQulusi is faced with serious financial problems caused by poor budgeting, planning, and monitoring. Allowing the council to fund unbudgeted projects could be a one-way ticket to a municipal crippling state. Council frequently passes unrealistic operating budgets. This forces them to run on persistent deficits, running out of cash reserves and falling into overdraft.
It was also for this reason that the DA objected to the final budget passed on 28 May, 2026.
Poor decision making has contributed badly to our municipal financial position; comparing Current Assets vs Current Liabilities (R289 938 027 vs R384 921 793), this is a clear indicator that the municipality is at a huge risk of failing to honour its debts and obligations. Employee cost contracted services and poor contracts management are the driving factors.
Since there is no turnaround strategy developed to improve municipal financial health, this move is irrational, such an unthoughtful decision will eventually result in an unplanned financial commitment, and it will expose the municipality to UIFWE.
This is a clear leadership and administrative failures
Ratepayers have been subjected to poor service delivery for a very long time; forced to drive on broken roads/potholes, experiencing water and electricity outage.
It I for this reason that we are calling on the chairperson of finance to refrain from taking long-term loans as a solution to fund current projects considering municipal financial position.