District applies for R50m loan to pay workers

Councillors and workers were on Thursday stunned when their salaries were not paid.
Councillors and workers were on Thursday stunned when their salaries were not paid.
Image: Leon Swart/123rf.com

Bojanala Platinum district municipality in the North West has resolved to go to the banks and secure an overdraft of R50m to pay workers and meet its operational needs.

Yesterday, councillors and workers were stunned when their salaries were not paid as the provincial treasury did not release the equitable share to the municipality, citing noncompliance.

This prompted the angry workers to confront officials, demanding answers.

Spokesperson Archie Babeile told Sowetan that a special council meeting was held yesterday to discuss the financial situation.

"Council took a resolution today that we are going to invoke section 45 of the Municipal Financial Management Act which says if municipalities for any reason are in dire need of financial assistance, we are going to apply for a short-term credit facility from a financial institution.

"We have sent the papers [to the bank] to get financial assistance in a form of an overdraft. We are talking about R50m which is not just for salaries but for operational costs.

"While we are waiting for the release of equitable share, we have to invoke this section of the act."

Provincial treasury told Sowetan it could not release the funds until the municipality complied with all requirements relating to its finances.

"Once the municipality has addressed all issues and recommendations by the provincial treasury the equitable share will be released," spokesperson Kesalopa Gill said .

"MEC Motlalepula Rosho has noted with appreciation that the municipality demonstrated commitment to address issues raised by provincial treasury.

"She says that the intention is not to punish municipalities by withholding funds but to ensure that laws and regulations are complied to."

Babeile said provincial treasury had an issue with the district municipality's budget not being compliant.

Would you like to comment on this article or view other readers' comments? Register (it’s quick and free) or sign in now.

Speech Bubbles

Please read our Comment Policy before commenting.