Minister Hlabisa Reacts to AGSA Report, Outlines Plans for Strengthening Municipal Governance

Minister Hlabisa expressed support for the audit improvements seen in some municipalities but raised concerns about those that have regressed.

Minister of Cooperative Governance and Traditional Affairs (CoGTA), Velenkosini Hlabisa, has welcomed the latest audit outcomes report for municipalities from the Auditor-General of South Africa (AGSA), despite noting areas of concern.

The report, presented by Auditor-General Tsakani Maluleke to the Portfolio Committee on Cooperative Governance and Traditional Affairs, highlighted a decrease in the number of clean audits, with only one metro achieving a clean audit. Additionally, unauthorized expenditure amounted to R24 billion. Key Insights from the Audit Report:

Decrease in Clean Audits: The number of municipalities with clean audits has dropped, reflecting a need for further improvements in financial management and governance.

Unauthorized Expenditure: A substantial R24 billion in unauthorized expenditure was reported.

Improvement in Some Areas: While overall progress was limited, reductions in disclaimed audits and significant improvements in the Eastern Cape and KwaZulu-Natal were noted.

Minister Hlabisa’s Response

Minister Hlabisa expressed support for the audit improvements seen in some municipalities but raised concerns about those that have regressed. The Minister reaffirmed commitment to supporting the Auditor-General's initiatives and consolidating gains made in municipalities that have shown progress.

Planned Initiatives and Support

1. Multi-Stakeholder Approach:

Establishing a framework for enhanced collaboration between stakeholders to support local government.

2. Ethical Leadership:

Launching the Code for Ethical Municipal Leadership to promote ethical behavior within municipalities.

3. Professionalization of Public Service:

• Implementing the Framework Towards the Professionalisation of the Public Service, ensuring appointments are based on merit.

4. Strengthening Oversight:

• Enhancing oversight through Municipal Public Accounts Committees and other structures, focusing on capacity-building and consequence management.

5. Addressing Coalition Governance Challenges:

• Introducing the Local Government: Municipal Structures Amendment Bill to manage coalition governments and address governance instability.

6. Improving Audit Outcomes:

• Developing Municipal Support and Intervention Plans in collaboration with various stakeholders to enhance governance, financial health, and service delivery.

District Development Model (DDM)

The department continues to implement the District Development Model (DDM), which aims to address socio-economic challenges and promote investment in local economies. This model includes the establishment of district hubs and development of DDM One Plans for district municipalities.

Future Steps

Minister Hlabisa plans to approach Cabinet to propose the establishment of an Inter-Ministerial Committee to focus specifically on municipal audit outcomes, further emphasizing the need for coordinated efforts across all government spheres to support municipalities effectively.

The CoGTA Department remains committed to implementing these measures to improve local government performance and ensure municipalities can fulfill their constitutional mandates efficiently and effectively.