2013 Report on the Financial Status of our Municipalities
National Treasury has released their 2013 report on the financial status of our municipalities (as at 30 June). Treasury's annual analysis incorporates a number of key financial indicators to determine the financial well being of South Africa's local government. Smart Metro looks at some of the major talking points of this year's report:
- 95 of the 278 municipalities were reported to be in financial distress. This is just one less than last year.
- Direct correlation between poor audit outcomes and the absence of a permanent Municipal Manager and/or Chief Financial Officer.
- Acting MM's and CFO's: 48 Municipalities (17%) had acting Municipal Managers; 60 Municipalities (22%) had acting Chief Financial Officers; 22 Municipalities (8%) had both an acting MM and an acting CFO.
- 42% of the CFO's in the Free State were acting.
- 226 municipalities (71%) made use of external consultants at a total cost of R378m for the year.
- 52 municipalities (19%) reported a negative cash closing position for the year.
- 142 municipalities have a cash coverage ratio of less than one month!
- Overspending on operational budgets has decreased significantly to R2.6bn (from R8bn last year)
- Underspending on capital budgets remains high at R13.4bn (24.7%).
- 190 municipalities had debtor levels higher than 30% of own revenue (up from 154 municipalities last year).
- Total municipal debtors has increased from R78bn to R87bn (11.5%).