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Only four Free State municipalities’ budgets for 2023/24 financial year are funded

Only four out of the 19 Free State municipalities adopted funded budgets for the current financial year. The projected annual revenue of the other 15 will not cover their budgeted expenses.

The Provincial Treasury admitted, during a meeting of the Free State Legislature’s Public Accounts Committee this past week, that the Mangaung, Matjhabeng, Setsoto and Metsimaholo Municipalities are the only ones whose budgets are funded for the 2023/2024 financial year.

Funded budgets do not, however, necessarily guarantee service delivery, but at least determine that the projected income will cover the expenses.

Unfunded budgets are not only unlawful, but also have an enormous impact on municipalities’ cash flow and, consequently, service delivery.

At present, all outstanding debt to municipalities amounts to R33 billion, of which the provincial government owes R1,4 billion.

Municipalities’ biggest challenge is debt collection from government, residents and businesses, while most municipalities simply fail to implement sound financial systems. In many municipalities, residents receive estimated water and electricity consumption readings, if they receive accounts at all.

Municipalities are also guilty of not keeping reliable registers of indigent residents, who are provided with services, such as water and electricity, for free.

What is even more alarming is the Auditor-General’s (AG) finding that 80% of the province’s municipalities’ current budgets will need to cover more than half of the previous financial year’s debt.

So, proper service delivery will not be provided and residents will once again bear the brunt of municipal decline under ANC rule.

Political will is needed to remedy the financial affairs of the province’s municipalities. And the ANC demonstrates year in and year out that it does not possess such political will. The only way to bring about real change is to get rid of the ANC.

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