Bombshells rock Council

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Last Friday’s Special Council Meeting at the City Hall was so packed with extraordinary developments and announcements that a proposed increase in Makana’s salary budget of close to R370 000 almost went under the radar.

The meeting came just a few days before the shock announcement that alongside the gang of municipalities whose electricity Eskom would be rationing starting next Friday, 30 municipalities would also have their water throttled because of debts to water boards and the Department of Water and Sanitation.

Makana’s electricity supply is for now secured. So is our water supply – administratively if not physically. Both are thanks to new payment plans approved by Eskom and Amatola Water, along with the Auditor General, which Makana owes R12m in audit fees.

The Council gave every impression of taking charge of an institution that was getting its house in order and significantly, it was ANC councillor Nombulelo Masoma backed by Luyanda Nase who swiftly took the lead last Friday in emphasising that ratepayers’ money must be ringfenced to pay Eskom.

“People are paying for electricity: there’s no excuse to use that money for any other purpose,” Masoma said. “The Finance Department must make sure that is where it goes.”

It was a move that DA councillor Darryn Holm later noted answered a motion he’d submitted to Council to ring-fence income generated from electricity sales until the historical debt, which had increased by R15 million in the past year, was paid off.

According to Council documents, on 22 November Makana owed just under R68 million.

Acting municipal manager Nomthandazo Mazwai addressed concerns from councillors Mlindi Nhanha and Holm about the payment plan which sees Makana paying R12 million by Wednesday (6 December), followed by quarterly payments of R7m corresponding with the municipality’s equitable share payout. Mazwai revealed generous terms in which, provided Makana pays its current account, the debt would for three years carry no interest.

Makana owes Amatola Water R44.9 million. It was because of long-running unpaid debt that the utility withdrew their services at the end of August this year.

While Amatola have not agreed to waive interest, they have agreed to a R5m payment after receipt of the equitable share and a payment of R3.6m with each Equitable Share payout.

A bombshell for local businesses was the proposed abolishment of discounted electricity tariffs (10% and 15%) for around 15 bulk users in the Makana area.

These according to documents “lost” Makana R84 919.09 in the past financial year. Councillors Brian Fargher and Nhanha warned of the possible impact on some of those businesses and the need to communicate properly with them.

These were some of the extraordinary moves in response to the axe that Cogta MEC Fikile Xasa has held over the Council since mid-November. Xasa sent formal notice of his intention to put Makana under administration under Section 139(1)a, received by Mazwai on 10 November.

Xasa cited Makana’s failure to appoint a municipal manager (Systems Act 54A(1)) and its failure to manage its debt (“Non compliance with Section 65(2)e of the Municipal Finance Management Act in relation to expenditure management”) and required representations within 14 days to state reasons why Section 139(1)(a) should not be invoked.

In direct response to Xasa’s first charge, chief whip of the ANC caucus Mabhuti Matyumza said that the MEC, as the second respondent in former councillor Paul Notyawa’s interdict against Makana’s appointing a municipal manager, was obviously aware of why they had not yet appointed a chief accounting officer.

Notyawa has for more than two years pursued his claim to the position of municipal manager.

“The failure of the administrative processes here is the direct result of not having a fulltime accounting officer,” Matyumza said.

In a surprise move, he called for the Sarah Baartman District Municipality to deploy their highly capable Municipal Manager Ted Pillay to Makana for three months in an acting MM role.

This should be done without expense to Makana other than travel and accommodation, as he would continue to be paid his salary. This was on the basis of the principles of intergovernmental relations.
Following an urgent caucus, the DA then made another surprise move, suspending the call they made last week for the Council to be dissolved in terms of Section 139 (1) (c).

Nhanha said they suspected political posturing to be behind the MEC’s throwing his weight around.

“It’s interesting that the MEC picks on only a few municipalities,” Nhanha said, addressing the full council. “We suspect it’s nothing but political posturing and that the MEC’s behaviour is the direct result of dynamics outside this Council.”

Also on the agenda was an essential minimum service agreement for municipal employees, and an agreement with the Auditor General about Makana’s other large debt in unpaid audit fees (R12m).

Proposed 5.9% salary increases for senior officials were detailed and discussed, with the pay of the hypothetical municipal manager, at the top end of the scale, gaining R3 600 bringing their annual salary package to R1 388 092.20. At the bottom end of the Section 57 positions, the Director of Infrastructural and Engineering Services heading for a R960 026.45 annual salary package.

“Provision was made on the approved 2017/18 budget for and 8% increase in salaries,” the agenda item read. “The 5.9% increase translates to an increase of R367 748.73 per year.”

* Correction made: Annual not monthly salary packages were proposed in the COuncil meeting. 

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