Top rating for uMhlathuze
This was revealed in national Treasury's State of Local Government Finances and Financial Management report for the 2017/2018 financial year which was released last week
THE uMhlathuze Municipality has been listed among the top five financially healthy municipalities in the country.
This was revealed in national Treasury’s State of Local Government Finances and Financial Management report for the 2017/2018 financial year which was released last week.
It evaluated eight metropolitan municipalities, 19 secondary cities as well as 186 local and 44 district municipalities.
In the latest report uMhlathuze tied for fourth place with Nelson Mandela Bay, Ekurhuleni Metro and Tlokwe-Ventersdorp.
The previous financial year uMhlathuze tied for first place with Drakenstein Municipality in the Western Cape.
King Cetshwayo was also rated among the financially healthy district municipalities.
The report considered, among other aspects, cash availability to meet the municipality’s fixed operating expenditure requirements, its reliance on national and provincial government grants as well as overspending and under-spending of original operating budgets.
‘While most municipalities are in reasonably good shape, about 125 municipalities are in varying degrees of financial distress.
‘This report concludes that a significant number of municipalities continue to perform poorly and remain a cause for concern.
‘This contributes to a negative impression of the performance of the municipal system as a whole,’ Treasury said.
Twenty-five municipalities were found to have overspent their operational budgets by more than 25%.
These municipalities include two secondary cities, 21 local municipalities and two district municipalities
‘In the 2017/18 financial year, only 18 municipalities obtained unqualified opinions without findings.
‘This was a 47% decrease compared to 34 municipalities in 2016/17,’ Treasury said.
‘According to the Auditor-General, the closing amounts for irregular expenditure increased from R62.7-billion in 2016/17 to R71.1-billion in 2017/18.
‘Unauthorised expenditure increased from R11.2-billion in 2016/17 to R12.8-billion in 2017/18.’
Treasury said, however, that a number of municipalities have either sustained or improved their financial performances, particularly in larger urban areas, despite economic and developmental challenges.
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