The City of Ekurhuleni welcomes the Auditor-General's 2016/17 financial year audit report which has revealed a complete elimination of unauthorised expenditure in the City. While the opening balance in unauthorised expenditure stood at R67m at the beginning of the financial year under review, the City managed to completely avoid any such spending in the 2016/17 financial year.
"The fact that this fifth administration achieved this in its first year of leadership bears testimony to our dedication to clean financial management and efficient administration," says the city manager, Dr Imogen Mashazi.
The above-successes must be attributed to the City's rejuvenation and strengthening of governance committees, a move that has seen all the City's procurement committees sitting on a regular basis. The metro has gone on to attract competent managers to run our procurement; reviewing of the membership in committees; training of project managers in Municipal Finance Management Act to broaden their understanding of the supply chain processes, policies and regulations. Special attention has also been given to consequence management to ensure that those found to be flouting the supply chain policy are taken to task."
The City made commendable strides in promoting a more effective, accountable, responsive, transparent and clean local government. In its efforts to improve good governance, the City placed a premium on legislative compliance, strengthening of management practices, broadening participation, financial governance and dedicated customer care as well as striving for effective service delivery.
Despite some notable challenges that may have impacted negatively on the City's audit results and on the overall target achievement, the City recorded some positive strides regarding its performance against predetermined objectives and targets.
At the top of the list is prudent financial management which has resulted in the City priding itself of a healthy liquidity ratio in that it can continue with operations and meet its financial obligations for a period of over 60 days in the case there is no sufficient revenue inflow from service charges.
"Indeed, we are presiding over an institution that has a low exposure to credit risk and thus far has been able to service both its long term and short term debts without default," says Dr Mashazi.
Other high level achievements include the marginal improvement on the credibility of data that informs the reported information. This is attributed to the strengthening of data quality controls and improvements in the combined assurance processes (monitoring and internal audit) instituted by the City.
In the audit report Auditor-General stated: "In my opinion, the consolidated and separate financial statements present fairly, in all material aspects, the consolidated and separate financial position of the group as at 30 June 2017, and their financial performance and cash flows for the year then ended in accordance with the South African Standards of Generally Recognised Accounting Practice and the requirements of the MFMA of 2003 and the Division of Revenue Act of South Africa, 2016."
"I believe that the audit evidence I have obtained is sufficient and appropriate to provide the basis for my report," he continued.
The other notable area of good performance is the City's dedicated focus in delivering good quality services to the poor and previously disadvantaged areas.
In this regard, there was notable progress in the electrification of informal settlements, decisive and focused implementation of the reblocking programme to improve livability of informal settlements and the provision of a consistent and predictable supply of basic services (interim basic services) in the informal settlements while maintaining good service standards in developed areas.
While the City targeted to spend 95% of its capital budget, the actual expenditure recorded over the financial year under review amounted to 91.64%. The reported expenditure is a significant improvement from the 87.88% of the previous financial year (2015/16). This reflects our effectiveness in rolling out infrastructure programme in road construction, water and sanitation, waste management and providing human settlements. It also demonstrates progress in our expansion of access to healthcare, social development, sports, arts and culture services.
The City's key service delivery milestones include:
paved 61.618 kilometres of road;
added a total 79 stormwater systems to the existing stormwater network;
upgraded sports, recreation, arts and culture facilities such as swimming pools, tennis courts and libraries;
achieved a 1.35% reduction of mother-to-child HIV transmission;
launched 21 Chronic Medication Pick Up Points in our communities;
six clinics were completed over this financial year;
spent in the region of R19,9 million in the construction of three Earl Childhood Development (ECD) centres that are at advanced stages of completion;
spent about R155,5 million in the upgrading of existing ECD facilities;
an increase of our annual bursary fund from R10 million to R100 million;
a total of 729 Peace Corps were converted to Traffic Wardens;
spent about R12,1 million towards the construction of 4 EMPD precincts that are in different stages;
spent about R49,8 million in the purchase of specialised vehicles and equipment;
delivered a total of 100 713, 240-litre sized bins to households;
spent about R65 million to upgrade our dumping sites and about R39 million more on the purchase of specialised vehicles and equipment for waste disposal and recycling;
maintained the blue drop status of greater than 95%; and
managed to pay 84% of supplier invoices in less than 30 days.
"These are enormously significant achievements, and the people of Ekurhuleni benefitted from them. As we move forward, we need to take into account that citizens' expectations of service delivery are real. We need to up our game to meet, and even surpass, the expectations of our people," says Executive Mayor Cllr Mzwandile Masina. "However, this will happen only when we work as a collective, sharing resources, skills and tested systems, towards wholesale clean administration."
Good financial management and clean administration can only happen when there are robust checks, balances and systems in place. In most instances we have excellent policies and procedures in place, and these are important as they give us guidance. But now we need to implement these with great vigour and conviction to retain our clean audit status, Masina continues.
While the City is pleased to note the significant improvements as recorded in the report, there is agreement with the Auditor-General that more can still be done.
In this regard, the City shall continue to implement sustainable improvements in overall financial management, governance and the availability of quality management information – hence our main focus will be to ensure that our Asset Management processes are advanced; Electricity and Water losses are reduced; Performance Management; and ICT Governance processes are improved.
We remain optimistic and committed to working with everyone who is committed to sustainable, wholesale clean administration and good governance in our municipality. This includes private and public sector professionals who are willing to share their skills and time, to assist us on our mission," expands Dr Mashazi.
Her views are echoed by Cllr Masina when he says: "It is critical to have good systems, policies, the right people and modern tools of the trade in place. But having the leadership set the right ethical tone in pursuit of good governance is equally priceless. Ethical conduct will be the mainstay of this metro's leadership and to lead by example at all times.
"Good ethical conduct, honesty and integrity must be the order of the day and we have seen great strides and improvements towards good governance. The leadership must strive to do the right things at all times, and those we lead will follow the example we set," concludes the Executive Mayor.