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The National Treasury announced on Tuesday it will temporarily freeze its July equitable share transfers to 75 municipalities due to continued irregular expenditure and fruitless spending.
Here are some of the important facts you need to know about this decision.
- The grants are unconditional annual transfers from Treasury to municipalities, especially those under-resourced, to ensure that they can provide free basic services to indigent households,
- Unlike conditional grants, municipalities have the discretion to decide how to allocate this money within their array of local government functions,
- Among the municipalities affected are the City of Johannesburg, Emfuleni, Rand West City and Sedibeng district municipality in Gauteng; Mangaung and Matjhabeng in the Free State; Buffalo City and Nelson Mandela Bay in the Eastern Cape; and several municipalities in KwaZulu-Natal, Limpopo, Mpumalanga, North West, the Northern Cape and the Western Cape.
- Treasury said the municipalities’ poor financial management has resulted in R145bn in irregular expenditure and R24bn in fruitless and wasteful spending,
- It said 16 municipalities owe money to pension fund administrators, 18 owe money to Eskom and 13 have debt with Sars and water boards.
Sowetan
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