by Cllr Annette Van Wyk – Phokwane Municipality
The Democratic Alliance has warned Phokwane municipality that we will lay a criminal charge against the municipal manager if they default on third party payments.
The embattled municipality is facing a cash crisis. Unless Phokwane manages to collect R2,5 million in outstanding debt owed by state departments by the end of today, 354 personnel members will be at risk of having their pension funds and medical aids lapse.
Phokwane municipality has been on a steady decline for years and has been unable to conclude audits by the legislated date since the 2017/18 financial year. The financial state of the municipality has deteriorated rapidly since September 2022, when it showed no debts or outstanding amounts to pension funds. By the end of last year, the debtor age analysis showed that significant amounts of monies owed to Phokwane were outstanding for more than 90 days. This has inevitably led to cashflow constraints that make it difficult to pay bills and third party payments. In this regard, the current collection rate of the municipality is only 47%, which is way below the 95% norm. National Treasury has meanwhile warned that it may withhold the equitable share due to lack of a funding plan and failure to implement measures to improve the funding position of the municipality.
The DA wants to remind Phokwane municipality that no amount of financial incompetence and mismanagement can justify the non-payment of pension fund contributions, which is in fact punishable by the law.
Last year, the former municipal manager of Kai !Garib municipality was arrested because he failed to ensure that contributions deducted from municipal employees, were paid to the consolidated Retirement Fund for Local Government.
The DA will not hesitate to lay similar charges against the Phokwane municipal manager if he allows the same to happen.
Employees work hard to ensure that they will have something to fall back on when they are retired, or that they can access medical care when the need arises. For government to violate the safety measures employees put in place for themselves, is inexcusable and there must be harsh consequences for this.