Madibeng Municipality must be placed under section 139 administration

06 August 2014

In a recent reply to a DA parliamentary question, the Cooperative Governance and Traditional Affairs (COGTA) Department revealed that the Madibeng Local Municipality in the North West, owes service providers and contractors more than R110 million.  

In addition to the growing debt, the Municipality also owes the Public Investment Corporation (PIC) an astonishing R667 million on a loan taken since January 1994. 

This is the very Municipality where four people died earlier this year during a protest by a local community demanding access to clean drinking water. 

I will write to COGTA Minister, Pravin Gordhan, to request he place the Madibeng Local Municipality under section 139 administration and to provide immediate support in the form of technical and financial advisors in order to put proper processes and systems in place. 

In another reply from COGTA, Madibeng Local Municipality was placed under administration in February 2014; however the Minister withdrew the section 139 intervention in March of this year and opted for a section 154 support programme to the Municipality.

It is evident from these replies that the situation in the Madibeng Local Municipality is untenable. The financial crisis in the municipality is at the core of the problem which is resulting in a lack of drinking water and proper sanitation in the municipality. If a municipality is not able to manage its finances, it cannot deliver services. 

I will submit further parliamentary questions to ascertain the reasons why the Minister initially considered placing the Municipality under administration but then within a month withdrew it. 

I will also be writing to the Portfolio Committee chairperson on COGTA, Richard Mdakane, to request the Minister to table these regulations and his reasoning for a section 154 support programme intervention before the Portfolio Committee.

Should the committee not be satisfied with the reasons and regulations put forth by the Minister, the DA will reiterate the call for a section 139 intervention by the Department on financial, administrative and governance grounds. 

The millions owed by the Municipality to the service providers affect the regional economy, it deters investment and local businesses are forced to close shop. 

Here is a list of the largest creditors:

There is a major crisis of governance facing the North West and urgent action is needed to remedy the situation.

Statement issued by Kevin Mileham MP, DA Shadow Minister of Cooperative Governance and Traditional Affairs, August 6 2014

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