DA’s Western Cape councils ‘better run’

As the DA’s hold on local government power grows, so has its record of clean government strengthened,  with DA-led councils far outperforming those led by the ANC in financial management.

This picture emerged on Wednesday, when Auditor-General Kimi Makwetu released the report on the audits of SA’s 263 municipalities for 2015-16. The findings are significant as the DA tries to position itself as an alternative government.

Makwetu reported a "marginal improvement" in a dire picture of mismanagement. Fruitless and wasteful expenditure, the most offensive category of mismanagement, declined 21%. However, irregular expenditure, in which procedures were not followed, went up 50%, a reflection of weak financial controls.

The report reflects the last year of last term of office immediately before the August 2016 election. Strong internal controls are viewed as the key to ensuring that municipalities deliver on their priorities.

Cape Town was the only one of the country’s eight metros to receive a clean audit, while 80% of the Western Cape’s municipalities — under a DA-led provincial administration — received clean audits.

The report states that in the Western Cape, "many municipalities have demonstrated accountability and good governance, which has led to an overall outcome of clean audits for the majority of municipalities".

Limpopo and Mpumalanga showed overall improvement, while North West, Free State and the Northern Cape were described as "the worstperforming provinces".

Makwetu said that Western Cape Premier Helen’s Zille’s office was the only premier’s office that gave the required level of assurance, which includes management, leadership and oversight. The level of assurance from the office of the premier of North West had regressed "as it played no role in improving the audit outcomes".

The good, the bad, and the ugly of municipal audits for 2015-2016

Click on a municipality to see its audit outcome and details of its unauthorised spending:

Source: Auditor General's consolidated general report on local government audit outcomes 2015-2016

No municipality in North West and Limpopo received a clean audit, while two Northern Cape and three Mpumalanga municipalities did. Just 49 of the 263 municipalities received clean audits; 122 received unqualified audits; 63 received qualified audits with findings and with adverse outcomes; 25 received disclaimers; and 27% of municipalities had been in a "particularly poor" financial situation by the end of the 2015-16 financial year, with uncertainty over their ability to continue operating.

Makwetu said the indicators raising the most concern over the past two years were municipalities spending more than their available resources; liabilities exceeding current assets at year end; debtors not paying, or taking long to pay; and creditors not being paid on time. The biggest risk for the future was the sustainability and availability of funding, as trends showed that the ability of municipalities to pay for basic necessities was declining. "While the number of clean audits in Gauteng declined, all councils, except for Midvaal, received unqualified audits with not one in the red."

DA MP in the portfolio committee on co-operative governance and traditional affairs Kevin Mileham said: "We have demonstrated where we govern, we govern better. Our policies and processes are cleaner and more efficient. It’s a lot of work ahead of us to get clean audits and keep them."

Municipal IQ economist Karen Heese said while clean audits were an ideal, it was arguably more meaningful to look at clean audits as well as those that are financially unqualified with findings. In this view, Gauteng would perform much better. The Western Cape’s success should be acknowledged and suggests gaping divisions in performances between provinces.