Initially the department wanted to withhold R7.4bn. Godongwana said the R2.7bn was reallocated to “fast-spending programmes between best-performing municipalities”.
While municipalities failed to spend conditional grants, residents continued to struggle with poor service delivery. Among those that returned grant money this year was eThekwini. It sent back R200m, even though it lost 56% of water meant for residents because of leaks.
North West MPL Aaron Motswana, discussing the R340m nine municipalities in his province collectively returned, expressed disappointment, saying residents suffered from lack of service delivery while councils failed to spend money.
“What is disheartening is loss of funds meant for water by the Dr Ruth Segomotsi Mompati district municipality, whereas local municipalities under it are heavily affected by lack of water. The report indicates that R119,453 of the regional bulk infrastructure grant will be lost by Dr Ruth Segomotsi Mompati alone,” Motswana said.
TimesLIVE
Why Treasury stopped R2.7bn in municipal grant payouts
Image: Elmond Jiyane
Finance minister Enoch Godongwana believes it was necessary for his department to stop conditional grant payouts to underspending municipalities this financial year to “safeguard the funds against possible misuse”.
The National Treasury cut conditional grants by R2.7bn to municipalities which underspent in the last financial year. The funds are meant for development and the upgrade of dilapidated essential infrastructure to improve service delivery to residents.
The grants affected included those for water infrastructure, public transport, network development and informal settlement upgrades.
Godongwana, answering questions recently in parliament, said the Treasury stopped funding because the department anticipated municipalities would underspend again. His department said 171 municipalities were flagged.
“This decision was considered to safeguard the allocations against possible misuse of the funds and prevent funds from being utilised for operational activities,” the minister said.
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Initially the department wanted to withhold R7.4bn. Godongwana said the R2.7bn was reallocated to “fast-spending programmes between best-performing municipalities”.
While municipalities failed to spend conditional grants, residents continued to struggle with poor service delivery. Among those that returned grant money this year was eThekwini. It sent back R200m, even though it lost 56% of water meant for residents because of leaks.
North West MPL Aaron Motswana, discussing the R340m nine municipalities in his province collectively returned, expressed disappointment, saying residents suffered from lack of service delivery while councils failed to spend money.
“What is disheartening is loss of funds meant for water by the Dr Ruth Segomotsi Mompati district municipality, whereas local municipalities under it are heavily affected by lack of water. The report indicates that R119,453 of the regional bulk infrastructure grant will be lost by Dr Ruth Segomotsi Mompati alone,” Motswana said.
TimesLIVE
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