- Says metro was financially unstable, depended on government funding
- Now one of the most financially sound, with lowest debt to revenue ratio
Mangaung Metropolitan Municipality executive mayor Thabo Manyoni says he is happy with the achievements made by the local authority towards improving its finances and services to the people.
Manyoni said despite numerous challenges faced by the municipality, it had successfully delivered according expectations.
Addressing the media in Bloemfontein yesterday after a two day Mayoral Lekgotla, Manyoni said they had inherited an unstable municipality that was in a dire financial situation and was heavily dependent on central government for funding.
This, he said which meant the municipality had no strategies around generating income and most importantly, revenue collection.
The municipality had also received a series of disclaimed audit outcomes from the office of the auditor general, increasing debts, encroachment of capital grants to the tune of R340 million, failure to provide services and unstable labour relations.
“The municipality was not up to standard,” said Manyoni.
He said it was therefore important to acknowledge strides made by the current council in ensuring that the community of Mangaung received quality services as promised by government.
According to the mayor, these objectives would not have been achieved if the municipality had remained unstable, hence the first step was to stabilise the institution and ensure that critical departments such as finance and engineering were progressively resourced.
Manyoni said the council had made significant strides in setting the city on a sound financial path, saying the first unqualified audit report since 2006 was achieved in 2013.
He said the city as well as the municipality’s power distribution company Centlec had sustained the strong audit outcomes for the 2014/15 financial year.
The municipality obtained an investment grade rating from Moody’s in April last year for the first time.
“These achievements cannot be overlooked and should in fact be appreciated by residents of Mangaung,” said the mayor.
One of the most important achievements highlighted by the mayor was the reduction of irregular expenditure from over R104.4 million in 2011 to less than R 9 million last year.
This, he said, provides comfort and accountability on the use of funds.
“This is one aspect the municipality needs to keep working on and ensure that no public funds are left unaccounted for,” he added.
Another boost for the municipality was its debt to revenue ratio which is the lowest in the country when comparing with other metros. In 2014 it stood at 14 percent, meaning there is sufficient borrowing capacity for the institution.
Manyoni said the journey was however not without its own challenges. He said among these challenges was the municipal indigent register which had grown significantly over the years, forcing the municipality to spend R300 million in the last financial year.
The money was spent on providing poor households with free water, electricity, garbage collection and sanitation services.
The mayor highlighted the shortage of water as one of the main challenges that the municipality was presently faced with and urged communities to continue using water sparingly.
The mayor announced that the Gariep pipeline which is to deliver water to Mangaung is estimated to cost the municipality R4.5 billion.
He said the pipeline would also ensure that surrounding towns such as Zastron, Bethuli, Trompsburg and Rouxville also got water.