The ANC in the City of Johannesburg says it knows nothing about a potential loan of R9,5bn supposedly being raised by mayor Thapelo Amad from a private financer.
ANC caucus leader and MMC for finance Dada Morero said he too found out on social media that Amad was in conversation with a potential funder.
In an interview with the SABC, Amad said he had attended a meeting last week in which he secured a prospect for a R9,5bn loan to fund “service delivery issues” and a “smart city”.
The interview, which Patriotic Alliance leader and coalition partner Gayton McKenzie tweeted was “embarrassing”, sparked another public debate about Amad’s competence to lead SA’s economic hub.
Yesterday Morero said : “As far as I am concerned I don’t know anything about it. We (finance department) have no intention to raise a loan. We only have an intention to raise revenue collection, which is rising very well so far... I don’t know anyone who will give us R9,5bn. You don’t want to put the municipality in such debt for a loan whose repayments we will not be able to honour. I doubt there is an institution that has that kind of money to lend to municipalities...” Morero said the city’s finance department was the one responsible for starting the process of securing a loan for the municipality.
“The process starts internally, where Treasury develops a report on the basis of what they see on the cash flow and whether we are required to raise a loan with any of the big four banks, the Development Bank of SA or go out into the market. Treasury then compiles a report and takes it to the mayoral committee. The committee goes through it and if there is justification for the loan, the report is taken to council for a decision,” said Morero.
Amad stands alone on ‘R9,5bn loan’
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The ANC in the City of Johannesburg says it knows nothing about a potential loan of R9,5bn supposedly being raised by mayor Thapelo Amad from a private financer.
ANC caucus leader and MMC for finance Dada Morero said he too found out on social media that Amad was in conversation with a potential funder.
In an interview with the SABC, Amad said he had attended a meeting last week in which he secured a prospect for a R9,5bn loan to fund “service delivery issues” and a “smart city”.
The interview, which Patriotic Alliance leader and coalition partner Gayton McKenzie tweeted was “embarrassing”, sparked another public debate about Amad’s competence to lead SA’s economic hub.
Yesterday Morero said : “As far as I am concerned I don’t know anything about it. We (finance department) have no intention to raise a loan. We only have an intention to raise revenue collection, which is rising very well so far... I don’t know anyone who will give us R9,5bn. You don’t want to put the municipality in such debt for a loan whose repayments we will not be able to honour. I doubt there is an institution that has that kind of money to lend to municipalities...” Morero said the city’s finance department was the one responsible for starting the process of securing a loan for the municipality.
“The process starts internally, where Treasury develops a report on the basis of what they see on the cash flow and whether we are required to raise a loan with any of the big four banks, the Development Bank of SA or go out into the market. Treasury then compiles a report and takes it to the mayoral committee. The committee goes through it and if there is justification for the loan, the report is taken to council for a decision,” said Morero.
He said the mayoral committee was due to meet on Thursday, where he expected Amad to explain the nature of the loan.
“Maybe on Thursday we will get more details... In fact it would be irresponsible borrowing. I don’t support it but I will hear on Thursday from the mayor to get clarity because I have questions that need to be answered,” said Morero.
He said the ANC still had confidence in Amad being the strongest candidate the party could back to lead the city.
“Thapelo is a candidate of the ANC. The [ANC Joburg] REC (regional executive committee) backed and supported him. The ANC has not shifted from that view. We are convinced he is the right guy for the job. The ANC does not see him as a puppet mayor. The ANC supported his name when it was proposed in the coalition,” he said.
DA caucus leader Mpho Phalatse said Amad had no business getting involved in “these kinds of administrative processes.”
“This is criminal and it ought to be investigated. The DA caucus in Johannesburg will ensure that this corruption is uncovered and dealt with. Council has no knowledge of such a loan and no loan can bypass council processes. The executive mayor is way over his head and he should allow city officials to manage administrative processes in line with the relevant legislation,” said Phalatse.
When contacted yesterday afternoon, Amad said he would send a statement to the media explaining the loan and would take questions thereafter.
kokam@sowetan.co.za