Business can play a role in strengthening municipalities
Poor service from underperforming, economically unstable municipalities is affecting the smooth running of business.
The auditor-general’s 2017/2018 financial audit of municipalities, released in 2019, revealed a severe lack of due diligence in project planning, improper financial management, and a significant decline in service delivery. The causes are varied, but can mainly be traced back to lack of accountability, poor governance, and capacity challenges.
The auditor-general’s municipal audit report found that accumulated, unauthorised, irregular and wasteful expenditure at municipalities had reached R122bn in 2017/2018. Performance reports by 65% of municipalities were dubious and close to unusable, with just 18 of the 257 audited municipalities (7%) managing to produce compliant financial statements and performance reports to receive clean audits — a comparative decline from the 33 (13%) clean audits produced in 2016/2017...