By Kwazi Dlamini
Corruption-ridden Mnquma Local Municipality in the Eastern Cape, together with its district municipality, Amathole, seems to be in tatters. Mnquma is off the radar – it cannot be reached by the usual forms of communication, while e-mail addresses provided on the website are unresponsive. The telephone number, also provided on their website as well as in the 2018 Local Government Handbook, rings unanswered. Numerous attempts spanning several months have yielded the same results.
It is worrying that the district municipality that is supposed to hold the local municipality accountable, appears to be just as dysfunctional.
On 7 July 2014, Corruption Watch received a report from a concerned citizen making allegations of corruption at that municipality for the years 2013 to 2014. The report alleges that the municipality amassed irregular expenditure of approximately R205-million. The Auditor-General’s (AG) 2014 Municipal Finance Management Act (MFMA) report, which gave Mnquma a qualified audit outcome with findings, agreed with the reporter’s claim in that the municipality could not provide audited evidence to explain expenditure of R55-million. The AG could not get to the bottom of this as the municipality did “not have appropriate systems to identify this expenditure”.
At the end of the financial year, June 2014, Mnquma had racked up irregular and unauthorised expenditure of R65.8-million.
However, investigating these claims has proven to be impossible. With no feedback from the municipality to our query letter sent in October 2017, and no contact with the municipality, information is simply not available.
The Eastern Cape division of the South African Local Government Association (SALGA) has confirmed to Corruption Watch (CW) that it is experiencing the same problems with Mnquma Local Municipality and Amathole District Municipality. SALGA says neither municipality can be reached. Furthermore, the mayor of Mnquma has been AWOL for some time and no one seems to know his whereabouts.
Municipality gone awry
The same Mnquma Local Municipality made headlines earlier this year when the Hawks, police detectives and members of Crime Intelligence pounced on 12 municipal officials. The arrested dozen, who faced charges of fraud, corruption and contravention of the MFMA, included the acting municipal manager Zonwabele Plata.
As voiced by auditor-general Kimi Makwethu at the presentation of this year’s MFMA report, the biggest issue they face with municipalities is non-compliance – it was for this very reason, said our concerned reporter, that service delivery is poor, because Mnquma officials do not submit documents that will hold them to account.
Mnquma has had a poor record in MFMA audit outcomes. In the 2013-2014 MFMA report the AG showed the municipality does not have proper systems in place to identify and disclose all irregular expenditure incurring during that year as required. According to the report, the municipality failed to submit sufficient audit documents and evidence for the unauthorised expenditure. The AG in 2013-2014 also found that the internal audit unit failed to advise the municipal council on matters relating to compliance with legislation.
Management problems
Mnquma seems to have a problem not only with corruption but with management as well. The long list of irregularities revealed by the AG’s report shows a strong sense of unaccountability – an accounting officer (who is unknown to CW) as well as the council failed to report cases of alleged irregular expenditure, as the MFMA requires, to the South African Police Service (Saps), the report notes.
The report also revealed that the municipality appointed individuals who did not meet the minimum requirements for their positions. The CFO was appointed without having met the minimum competency level as required by the Municipal Systems Act. The head of supply chain management (SCM), Nontathu Mnini, did not have the higher education qualification or indeed, any of the competency areas, as prescribed by the MFMA. Other officials, such as middle-management finance officials, also did not meet the competency requirements.
When questioned about Mnini’s credentials, the municipality transferred her to another department but later reinstated her in 2017.
The acting CFO and acting head of SCM were in their positions for more than three months without the approval of the MEC for Local Government, which breaches sections of the Local Government: Municipal Systems Act.
Irregular procurement
The reporter also details a list of irregular procurement matters. CW heard that the municipality changed tender invitation requirements to favour their preferred contractor – a clear breach of SCM policy. Contracts of less than R200 000 were awarded without inviting competitive bids or without any quotes received as per SCM regulations.
The municipality also failed to act and follow up on reports of mismanagement issued by internal auditors which led to repeated findings in the external audit reports.
Mnquma Municipality remains an unsolved case as the arrested officials of the municipality are still involved in their court cases at the Butterworth Magistrate’s court, The Hawks Eastern Cape division refused to comment on the status of the case as they believed it could sabotage their case.
It also remains unclear whether the arrested individuals still hold their positions at the municipality or were suspended.
