Mafube earns 6% on the Auditor-General's scorecard

Mafube Business Forum (MBF) previously reported on the use of consultants for the task of submitting the 2024/5 financial statements of Mafube Local Municipality (MLM) to the office of the Auditor-General (AG) before the legislated date. MBF questioned the high cost (in excess of R5-million) of employing external contractors to perform a function which should be within the ability of the senior management team, whom are already paid huge salaries. During a meeting with the Municipal Manager, Ms. Jemima Selepyane, the matter of a mandatory skills-transfer agreement with the consultants was discussed but to date our requests for information were ignored by both the MM and the appointed consultants.

It should come as no surprise, that MLM’s audit outcome for the financial year ending on 30 June 2025, is once again regarded as “Qualified”- which means once again a “fail” for Mafube! This is due to material irregularities detected in the financial matters of the municipality, and the doubt expressed by the AG, as to MLM’S continuation as a “going concern”. The AG found that the municipality had an accumulated deficit of R 104 525 580 and its liabilities exceeds its total assets by R 1 141 934 921.

Not only do MLM fail in terms of financial management but also by its failure to provide services to the Mafube community as constitutionally obligated. The AG identified a number of key performance indicators which illustrate the extent of MLM’s incapacity, incompetence and lack of consequence management.

BASIC MANDATORY SERVICE	TARGET	ACHIEVED
PERCENTAGE HOUSEHOLDS WITH BASIC REFUSE REMOVAL	90%	0.01%
PERCENTAGE OF HOUSEHOLDS WITH BASIC ACCESS TO WATER	90%	4.48%
PERCENTAGE OF HOUSEHOLDS WITH BASIC ACCESS TO BASIC TO SANITATION	90%	4.48%
PERCENTAGE OF SEWERAGE BLOCKAGES REPAIRED WITHIN 48 HRS	85%	10%
PERCENTAGE OF WATER LEAKS REPAIRED WITHIN 48 HRS	75%	10%

Irregular, Unauthorised, Fruitless and Wasteful Expenditure

In addition to the evident incapacity, incompetence and lack of consequence management at MLM, the AG expressed concern with expenditure management and that no reasonable steps were taken to prevent irregular expenditure amounting to R 22 350 892 and unauthorised expenditure of R 339 649 598. A further R 63 150 759 of fruitless and wasteful expenditure was incurred due to interest on late payment of suppliers and ill-advised litigation.

Financial systems not in place

 The AG noted that inadequate systems are in place at MLM for management of assets, revenue, procurement, contracts, human resources, governance and oversight. Most concerning is that, despite clear regulations, assistance from government departments and the employment of consultants, the management of MLM continue to ignore their obligation to administer the finances of the municipality in compliance with the Municipal Finance Management Act. It seems that the critical principles and objectives of Consequence Management are beyond the grasp of those in charge at MLM.

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