Underspending on infrastructure has huge repercussions – Committee

Chairperson laments red tape that has devastating impact on people’s lives

Standing Committee on Appropriations expresses a concern with underspending on infrastructure by municipalities

22 November 2022

The standing committee on appropriations has expressed its concerns with continued underspending by municipalities especially on their infrastructure grants. The committee was briefed today by the Department of Cooperative Governance and Traditional Affairs (COGTA) on the 2022 Adjustment Appropriation Bill.
COGTA cited late registration of projects, poor management of contractors, supply chain management delays and vacant positions which impact on value chain as some of the contributing factors to underspending by municipalities.
The Chairperson of the committee, Mr Sfiso Buthelez, said: “What is even more concerning is the underspending on Municipal Disaster Response Grant.” Mr Buthelezi continued to lament the red tape that has devastating impact on people’s lives who are supposed to be getting the services.
According to COGTA about 88 municipalities out of 218 failed to spend at least ten percent of their 2022/23 Municipal Infrastructure Grant allocations. Mr Buthelezi said there is an expectation that once resources are made available there should be an urgency to assist people affected by disasters who find themselves living under inhumane conditions.
The committee expressed a view that underspending on infrastructure has huge implications on the Economic Reconstruction and Recovery Plan especially in stimulating various sectors of the economy.
The committee cautioned against spikes in spending later on in the year due to possible fiscal dumping. It has welcomed and applauded COGTA for being able to pay its service providers within 30 days.
The committee appreciated the interventions by COGTA and the Municipal Infrastructure Support Agent in assisting municipalities to perform their duties. The committee said that the primary responsibility of service delivery rests with municipalities to spend on their budgets.

Issued by Jabulani Majozi, Parliamentary Communication Services, 23 November 2022