The DA is calling for an urgent intervention into the financial affairs of the Magareng municipality as it appears that this municipality is on the brink of bankruptcy.
Worryingly, money was allegedly spent on salaries which was intended specifically for infrastructure relief in Warrenton.
We learnt that R6,3 million allocated by the provincial government to Magareng municipality, for fixing of roads and other infrastructure, has apparently instead been used to bail out the bankrupt institution over the past month.
The municipality has been on a downward trend, with an income return of only 23%, making it impossible for the institution to sustain itself.
The DA is deeply concerned about the state of Magareng municipality.
It is a shame that the residents of Magareng have lost out on money intended for the much needed repair of our roads. The backlog of road repairs throughout the province is growing, and each time money intended for pothole repair is squandered, it gets harder and harder to fix and maintain roads.
At the same time, if the municipality is not even able to pay salaries, we can only wonder whether it is servicing its debt. Of particular concern is the outstanding debt owed to Eskom which, as at 7 April 2022, stood at just under R80 million. We have already seen a crisis develop in Renosterberg, where Eskom won a court order to freeze the municipality’s bank account due to outstanding debt of R100 million, and a lack of will to pay back the debt. We cannot afford a repeat of this situation.
The DA will submit a letter and a parliamentary question to COGHSTA to determine the financial viability of Magareng municipality and its adherence to its Eskom and other payment agreements.
We will also request for an urgent intervention from Provincial Treasury, to prevent yet another Northern Cape municipality from collapsing.