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Under-expenditure shows massive lack of capacity in Eastern Cape municipalities

Aug 16, 2017
Under-expenditure shows massive lack of capacity in Eastern Cape municipalities

Under-expenditure of budgets in several Eastern Cape municipalities shows that there is a shortage of skills in these municipalities to carry out their mandate to local residents, the Democratic Alliance (DA) said on Wednesday.

"Infrastructure spending is a key component of creating economic growth in this province," described Bobby Stevenson (MPL), the DA's Eastern Cape Shadow MEC for Finance. 

"The horrific capital under-expenditure in some municipalities as the end of the third quarter (31 March 2017) clearly illustrates a massive lack of capacity.  This impacts negatively on the overall economic growth rate of this province and the ability to create jobs."

According to a reply to a legislature question that Stevenson asked Eastern Cape Finance MEC, Sakhumzi Somyo, some of the worst performers as at 31 March 2017 were: 

  • Mnquma Municipality:  4%
  • Sakhisizwe Municipality:  9%
  • Dr Beyers Naude Municipality:  12%
  • Amathole District Municipality:  18%
  • Makana Municipality:  26%

"By 31 March the average expenditure should be at around 75%," said Stevenson. 

For MEC Somyo's reply, click here.

"It should, however, be borne in mind that a number of municipalities may have upped their expenditure considerably in the last quarter of the financial year, which ended in June," Stevenson further said.  

"For example, the Nelson Mandela Bay Metro spent 94% of its capital budget as at the end of the financial year, its best performance in seven years. 

"But underperforming municipalities have no hope of reaching acceptable expenditure targets. Intervention needs to take place to ensure expenditure is beefed up. This is the only way communities will get the services they deserve."

Stevenson said that he will ask follow-up questions to determine the expenditure as at the end of June 2017 and what interventions have been put in place