SOWETAN | Joburg’s poor financial management worrying

Dada Morero’s tenure as Johannesburg mayor will be remembered for turbulence rather than delivery when his term comes to an end ahead of local government elections.

Since taking the reins at the helm of SA’s economic hub, Morero has been riding waves of storms, including water crisis, collapsing infrastructure, financial mess and electricity supply problems.

In the latest development, the mayor has asked for an urgent meeting with electricity minister Kgosientsho Ramokgopa to avert the possibility of the metro being plunged into darkness by Eskom over R5.2bn debt.

The power utility has threatened Joburg with disconnection after the city failed to honour its court-sanctioned agreement reached last year to settle outstanding debt. Eksom has already begun cutting off the city’s streetlights in some areas of the city due to the escalating arrears.

Ramokgopa, who was instrumental in negotiating a settlement between Eskom and the city last year, confirmed to Sowetan that he would be meeting with Morero to find a solution to the latest impasse. He expressed disappointment that the city had defaulted on its promise to pay despite the settlement being enforceable by the order of the court.

Two weeks ago, Morero held another hastily convened meeting with finance minister Enoch Godongwana after the minister read him the riot act over a R10.3bn wage deal. The National Treasury said the metro could not afford this due to low revenue collection and poor financial management. Godongwana threatened the city with funding cuts, sparking fears that the metro would be placed under administration ahead of crucial local government elections.

What these developments demonstrate is a city that is hobbling from one crisis to another. It is apparent that the finances of the city, despite denials in the past, have reached a breaking point. Alarmingly, City Power, which purchases the bulk electricity supply, has been paying its dues to the city’s finance department, but the money has not reached Eskom.

This does not only raise concerns about prudent financial management of the city but also implies that money meant for servicing debt may have been redirected to other programmes.

Last year, it was revealed in parliament that R4bn from Joburg Water’s account had been diverted to the city’s coffers but only existed on paper. As a result of this, critical maintenance of the water supply network had been delayed, leading to burst pipes and leaks.

Morero’s meeting with Ramakgopa may well avert the blackout in the short term, but evidently the city’s problems are far from over.