City of Joburg municipal manager Floyd Brink says he takes responsibility for control failures within Johannesburg which led to the auditor-general giving it a qualified audit opinion in the core administration.
This follows the auditor-general’s 527 findings against the city, which MPs described as pathetic in regard to the city’s governance.
Addressing parliament’s Standing Committee on Public Accounts [Scopa] on Tuesday, Brink described the city’s 2024/25 audit outcome as “a mixed one”, saying the municipality had received an unqualified audit opinion at the group level but regressed to a qualified audit opinion in the core administration.
“The qualification is quite serious, and as the accounting officer, I accept the responsibility relating to those control failures,” said Brink.
He also said the qualification stemmed primarily from issues relating to sundry debtors and expenditure cut-off processes.
However, he said, the city had already begun implementing turnaround and remedial plans to address weaknesses identified by the auditor-general.
“We have shifted the city’s focus specifically to focus on those weaknesses and also to ensure that we hold officials accountable where specific evidence supports,” he said.
Brink also revealed that the city is dealing with 34 cases that are under the disciplinary board and are under investigation, while six others are active criminals cases that have been referred to law enforcement.
He said there are also eight historical material irregularities certified to be resolved by the auditor-general.
Brink did not elaborate on these cases and what offences had been committed that led to the city taking steps.
The qualification is quite serious, and as the accounting officer, I accept the responsibility relating to those control failures
— City of Joburg municipal manager Floyd Brink
Tshepo Makola, the city’s COO, added that 36 other matters have been referred to the council for investigation.
“Six of those matters, the council approved that we do preliminary and final investigations. We’ve concluded those. We’ll be sending the final report to the council. We are targeting the end of June to submit those six matters that have been concluded,” he said.
“There’s a delay within the disciplinary board because we are dealing with backlogs. So we are dealing with matters from 2011 to 2013 that were already in the backlog in terms of investigations and write-offs.”
CFO Tebogo Moraka told MPs that Joburg Water and City Power are carrying infrastructure backlogs that cannot be financed through the city’s balance sheet alone.
Joburg Water requires an estimated R32bn over the next decade for critical infrastructure upgrades, while City Power faces a backlog of about R45bn.
“That’s a loss, and these are monies that if we can stop the bleeding, it’s monies that we can reinvest into these critical entities,” Moraka said, referring to billions lost through water and electricity leakages.
“We are aware that even from a balance sheet point of view, those numbers cannot be financed only from the balance sheet.”
Sinaye Nxumalo, executive director of Group Risks, told MPs the city had reduced its unauthorised expenditure [UIFW] balance from the previous year’s R23bn to R13.3bn.
She added that the AG had identified a further R2bn in unauthorised expenditure during the audit process.
“Were it not for that, we would have been able to reduce our year-end UIFW to an R11bn worth of measures,” he said.
Nxumalo said the city and its municipal entities had regularised about R45bn in unauthorised, irregular, fruitless and wasteful expenditure over the past five years.
She added that half of that amount related to bulk water and electricity purchases, while R17.9bn was linked to irregular expenditure and R2.4bn to fruitless and wasteful expenditure.
Sowetan
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.