Cogta sets record straight

Wednesday, March 15, 2017

Pretoria - The Ministry for Cooperative Governance and Traditional Affairs (Cogta) says there are no frustrations between the National Treasury and Cogta regarding allocation of funds to municipalities.

The Ministry on Tuesday dismissed allegations in the article published in Sowetan newspaper dated on the day.

The article suggests that Cogta Minister Des van Rooyen and Finance Minister Pravin Gordhan are disagreeing over funds allocated to municipalities through the Municipal Infrastructure Grant (MIG).

The Ministry said the two departments made a joint decision after technical teams from both departments had discussions and evaluated the trend of expenditure performance of municipalities that are unable to spend their grants, or sometimes using the grants for things other than what they were allocated for.

The Ministry said Cogta, National Treasury and Provinces have agreed on stopping and conversion in the three municipalities including Mafube Local Municipality in the Free State, where about R21.4 million was converted; Mopani District Munipality in Limpopo, where about R150 million was converted, and Ngaka Modiri Molema District Municipality in the North West, where about R290.2 million was also converted.

The Ministry said technical teams are exploring various options to ensure positive implementation in 2018/19 financial year. The teams also explored reallocation of the stopped funds to the high performing municipalities to safeguard loosing funds from the programme.

“These conversions were important as they are expected to ensure that the communities who are intended beneficiaries will still receive services, implying that we are not punishing communities for the poor performance of these municipalities,” said the department.

It said the affected municipalities had perpetually underperformed on MIG and failed to maintain sound financial management.

The Ministry said Cogta and National Treasury experienced implementation challenges including the process of accounting for infrastructure built on behalf of the municipalities and relinquishing rights of existing contracts that were contracted to both Ngaka Modiri Molema and Mafube municipalities.

“In an effort to avoid continuously punishing communities on non-performance of these municipalities and to ensure optimum compliance, it was decided by both departments to convert the funding back to a schedule 5B again.

“It must be noted that these municipalities won’t lose this money forever. The stopped funds will be reallocated to these municipalities during the next stopping and reallocation process upon their improved performance,” said the Ministry.

It said dedicated technical teams have been put in place to support these municipalities to improve their expenditure performance to circumvent stopping in future, and that processes are being put in place to ensure that outstanding invoices for work completed are paid to service providers. - SAnews.gov.za

 

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