The North West Provincial Treasury has intensified efforts to address municipal unauthorised, irregular, fruitless and wasteful expenditure (UIFWE), through coordinated interventions aimed at strengthening financial governance, enforcing accountability and safeguarding public resources.
The initiative, which includes the Department of Cooperative Governance and Traditional Affairs (COGTA), the South African Local Government Association (SALGA) and provincial municipalities, forms part of ongoing efforts to assess municipal progress in addressing historical UIFWE balances, identify outstanding compliance challenges, and implement practical corrective measures to strengthen financial management.
Municipalities are expected to provide verifiable evidence of progress in addressing outstanding UIFWE balances, ensure that expenditure write-offs are lawful and properly supported. They are also expected to strengthen consequence management and demonstrate effective oversight by Municipal Public Accounts Committees (MPACs) and municipal councils.
The initiative comes amid National Treasury’s interventions relating to the withholding of municipal equitable-share transfers.
Section 216(2) of the Constitution provides for the stopping of transfers to an organ of state in cases involving a serious or persistent material breach of measures established to ensure transparency and expenditure control, subject to applicable constitutional and legislative requirements.
The engagements also aim to support municipalities in addressing outstanding financial management weaknesses and implementing corrective measures ahead of the December 2026 equitable-share tranche.
Chief Director for Municipal Financial Management at Provincial Treasury, Linda Nengovhela, emphasised the importance of establishing effective financial management systems that prevent recurring UIFWE, and ensure that instances of financial misconduct are appropriately investigated and addressed.
“Municipalities must move beyond reporting UIFW balances to implementing tangible systems that prevent irregularities, recover losses where applicable and hold those responsible accountable. The focus must be on measurable progress, supported by evidence and effective oversight,” Nengovhela said.
She referred to the Greater Taung Local Municipality as an example of progress in addressing irregular expenditure, while acknowledging that further work remains necessary to address fruitless and wasteful expenditure.
Nengovhela also stressed the importance of applying Section 32 of the Municipal Finance Management Act, where applicable, to ensure that instances of unauthorised, irregular, fruitless and wasteful expenditure are investigated and dealt with in accordance with the law.
She also called on MPACs to fulfil their oversight responsibilities by scrutinising municipal financial management, examining outstanding UIFWE matters, and supporting effective accountability through the appropriate council processes.
The engagements further highlighted the need for outgoing MPACs and other municipal structures to maintain credible records and ensure the proper handover of outstanding matters to their successors to preserve continuity in financial oversight and consequence management.
Municipalities that fail to meet applicable financial management and compliance requirements may face further intervention, including the possible withholding of the December 2026 equitable-share tranche by National Treasury, subject to the relevant statutory processes.
Provincial Treasury emphasised that equitable-share allocations are an important source of funding for municipalities, supporting their ability to provide essential services to communities.
“Effective financial management is a timely corrective action and therefore critical not only for compliance and accountability, but also for protecting municipal service delivery,” the department said. – SAnews.gov.za
