Ditsobotla takes out ABSA loan to pay staff, owes Eskom millions more
1 March 2017
Only a few days after Premier Supra Mahumapelo slammed ABSA Bank and threatened to withdraw all provincial government accounts from them, Ditsobotla Municipality had to turn to the same bank and borrow money to pay employee salaries.
This R20 million loan was taken out without a council resolution as prescribed in the Municipal Finance Management Act, making the loan in contravention of the MFMA.
Employees were paid late for the month of February.
On top of this, Ditsobotla will also not be able to honour their agreement with Eskom to pay the arrears on their electricity bill. The ANC said that they will pay this account from their Equity Share that municipalities will only receive by the end of March.
Today is D-day for payment of the Eskom account. The terms of the agreement have already had to be altered before as this bankrupt municipality simply cannot honour their debt, and today’s new deadline for payment seems to be impossible to meet.
This is in contrast to statements that were made by the Premier during his State of the Province Address. Just days after Supra spoke, the cracks in his SOPA speech are already showing.
Supra assured residents of the North West that his government is working with Eskom and municipalities to ensure that payment agreements by municipalities are complied with. If Ditsobotla misses today’s deadline with Eskom, Mahumapelo’s promise will be another broken promise.
According to Mahumapelo, the province has also taken a resolution to allow Eskom to take over electricity distribution in municipalities which perpetually fail to manage electricity revenue and pay Eskom accounts. This is an enormous acknowledgement of the failing state of municipal governance in the North West. The Premier is effectively admitting that his Municipalities cannot do the job themselves.
We will closely monitor events in Ditsobotla, and the DA will fight to keep the lights on, as Supra’s government continues to drop the ball.
Issued by Jacqueline Theologo, DA Whip, North West Legislature, 1 March 2017
