Nine North West Municipalities may not receive their much-needed infrastructure grants from the Treasury because of their failure to spend previous budgets fruitfully.
The municipalities that the Treasury has threatened with sanctions include, Ditsobotla, Ratlou, Mamusa, Rustenburg, Jb Marks, City of Matlosana, Moses Kotane, Madibeng local municipalities and the Dr Ruth Segomosti Mompati District Municipality are set to collectively lose tens of millions of rands.
In a letter seen by Newsnote, the Minister of Finance Enoch Godongwana, informed the North West MEC of Cooperative Governance and Traditional Affairs, Nono Maloyi, that the municipalities’ grant allocations were reduced in the 2022/23 financial year, due to their failure to utilise the grants in the previous financial year.
The chairperson of the provincial legislature’s portfolio committee on finance, Aaron Motswana said the report showed R119 453 000 of the Regional Bulk Infrastructure Grant (RBIG) will be lost by Dr Ruth Segomotsi Mompati alone.
Other struggling local municipalities such as Mamusa, Ditsobotla and Moses Kotane failed to spend the Municipal Infrastructure Grant (MIG) and there is a general lack of service delivery to the communities in these areas, Motswana said.
“What is disheartening is the loss of funds meant for water by the Dr Ruth District Municipality whereas local municipalities under it are heavily affected by lack of water.
“The Portfolio Committee encourages MEC Maloyi to ensure accountability in this regard and provide progress on consequence management to the Committee. It is time that failure to spend grants is characterized as treason against the State and communities in their respective constituencies,” Motswana said.
The DA’s North West deputy leader, Freddy Sonakile, said the affected municipality will be left in a worse-off position adding that Dr Ruth Segomotsi Mompati District Municipality, the City of Matlosana and the Rustenburg, Moses Kotane, JB Marks, Madibeng, Ratlou, Ditsobotla, and Mamusa local municipalities will cumulatively lose R460 million in conditional grant funding.
“Madibeng is the biggest loser with a cut of R145 408 million, followed by Dr Ruth Segomotsi Mompati at R119 453 million and Rustenburg at R65 341 million. JB Marks and Matlosana are also in the top 5 worst affected municipalities losing R59 million and R26 million respectively.
“This is a heavy blow to service delivery in the North West. The African National Congress (ANC)-governed municipalities not only fail to invest in infrastructure development and maintenance but when they receive funding, fail to spend the money on projects it is intended for.
“North West suffers a massive infrastructure backlog. The National Treasury’s decision, although understandable, will put additional strain on the already limited cash flow of municipalities, who mostly adopted unfunded budgets.
“The little revenue collected by municipalities will be utilized for operational and wage bill expenses, and as municipalities struggle with the infrastructure backlog. The withholding of conditional grant funding will contribute to an increase in the already ballooning Eskom and water bulk services debt, third-party payments such as PAYE, VAT, and pension and medical aid contributions, but worse of all, it will further collapse basic service delivery to the resident,” said Sonakile.
The North West Department of Cooperative Governance and Traditional Affairs said it will comment later on the matter.
