Postponement of MPAC meeting risks R546-million equitable share transfer for Nelson Mandela Bay

Delays in distributing municipal public accounts committee (MPAC) agendas to Nelson Mandela Bay councillors cost the city the opportunity to write off more than R1.7-billion in unauthorised, irregular, fruitless and wasteful expenditure when the meeting was postponed on Tuesday.

The postponement risks the payment of R546-million in equitable share due in the city’s coffers this month, after the National Treasury threatened to withhold the funds on 11 November.

The late delivery of the agendas is apparently due to an expired printing contract that has not been advertised yet.

Treasury threatened to invoke section 216 (2) of the Constitution, which allows it to stop the transfer of funds to an organ of state.

In the metro’s case, the Treasury said it would stop the transfer of the December tranche of the equitable share if the city failed to deal with the R30.6-billion in historic unauthorised, irregular, fruitless and wasteful expenditure (UIFWE).

Read more: Treasury threat to withhold NMB funding puts salaries and services on the line

Of the total UIFWE, R2.6-billion is listed under limitation of scope, because the city cannot account for this expenditure due to files lost when it converted to a new filing system.

Intervention

The mooted intervention by the Treasury is preceded by the introduction of a delegation from the Department of Cooperative Governance and Traditional Affairs (Cogta), which will be unveiled during Thursday’s council meeting.

The delegation has been brought to the city to assist in the budget and treasury directorate, with specialist engineers deployed to improve the delivery of services.

Eastern Cape Cogta head of department Vuyo Mlokothi confirmed the announcement of the delegation in the council.

“The deputy minister of Cogta Namane Masemola has asked the Mayor Babalwa Lobishe for a slot in the 4th of December council to present a government support package for the metro,” Mlokothi said.

“The reasons for bringing the support to the municipality and their duration of stay will be explained when the team is introduced on Thursday.”

The MPAC agendas, each comprising 1,400 pages that contain the write-offs, were either not delivered to some councillors or distributed on Sunday and Monday.

According to council rules of order, councillors are meant to receive agendas five business days before the meeting.

This is the third time MPAC meetings have been postponed, with the last two scheduled meetings called off due to a lack of attendance by members and some officials. Lobishe had blamed the delays on MPAC’s failure to convene to address the UIFWE.

Delivering his opening remarks, MPAC chair Luxolo Namette voiced serious concern for what he described as “conduct that undermines service delivery and creates a favourable environment for maladministration and potential corruption”.

Namette said the postponement of the meeting severely disadvantaged the committee.

‘Unacceptable’

“It limits adequate preparation and compromises the quality of oversight expected from the committee. My preliminary investigation revealed that the delay resulted from the absence of an active printing contract after a previous contract had lapsed – a situation I regard as wholly unacceptable.”

Namette said this was not the first time the metro had postponed meetings or interrupted critical service delivery processes over a contract that had been left to expire without the timely appointment of a new service provider.

“Such lapses force the municipality into deviations, month-to-month arrangements, three-month stop-gap contracts, or requests for quotations for services that should be procured through a proper competitive bidding process,” he said.

Read more: Waterlogged paperwork exposes Nelson Mandela Bay’s outdated financial record-keeping

Namette said he would ask the office of acting city manager Lonwabo Ngoqo to submit a comprehensive report detailing all lapsed contracts, reasons for the lapses, the list of all short-term and temporary procurement arrangements and the consequence management steps taken, among other details.

The report is expected in time for the next MPAC meeting. After the meeting, Namette confirmed that the MPAC was supposed to consider the write-offs.

Ngoqo said that considering they were busy with the process of write-offs, he saw no reason for the Treasury to stop the transfer.

“On 19 November, the MPAC committee approved R1.8-billion in UIFWE for write-offs. This shows we are doing what Treasury directed us to do for it to pay the December tranche.”

Ngoqo said he had written a reply to the Treasury, informing the institution of the work the city was doing, including the implementation of consequence management. “I’m now waiting for the response.”

Ngoqo said Cogta’s Masemola was coming to the metro on Thursday to set a path forward in accordance with requests from the city for support.

“Perhaps the support brought by Cogta is aligned to the intervention by the Treasury, hence I believe the money will be paid at the weekend (7 December).”

ANC councillor Luzuko Peter was the first to request that the meeting be called off, as they had not had enough time to analyse the huge pile of documents.

“One of the ANC councillors [Nonhinha], Maswana, did not get the agenda.

“I got mine two days before this meeting. The rules of order are clear about when councillors should get agendas. We must not undermine MPAC’s role, which is to perform oversight on the functions of the municipality,” Peter said.

“When we are dealing with the process of section 32 reports and the acting city manager gives us agendas 24 hours before the meeting, our work is being compromised as we won’t be able to interrogate and analyse the reports.

DA councillor Gert Engelbrecht said it was clear that the meeting would not convene when he received his agenda of 1,400 pages on Monday afternoon.

“It would have done this institution no justice for us to rush through this agenda without doing due diligence. To just come here as a [futile] exercise is totally unacceptable.

“This agenda contains massive amounts, and we need to do proper investigations. We need to get the agendas on time, otherwise we will make mistakes.

Engelbrecht said MPAC items meant for council had no annexure attachments, which reflected badly on them after they had previously raised the issue.

“It’s not the first time I’ve said that MPAC is not taken seriously.”

ACDP councillor Lance Grootboom said he received his agenda package on Sunday evening, thinking that it was council documents only.

“To get an agenda with items with such huge amounts so late or not at all is to undermine the work of the council. What makes it worse, the National Treasury wrote to the city informing it that if we don’t deal with the UIFWE, they are going to withhold the equitable share tranche. I would like to know what the city said in response, as it was meant to reply by 1 December.”

Grootboom condemned Lobishe for telling the media that MPAC meetings did not convene, as councillors put in the effort, but were disadvantaged by municipal officials.

EFF councillor Siyabulela Mosi said if a roll call of all the officials expected to attend the meeting had been conducted, it would reveal that some were absent.

“It would show that there was no intention to make sure that MPAC moves in the right direction,” said Mosi.

“I’m one of the councillors who has yet to receive their agenda. I did not even intend to [borrow] from someone else because we have spoken about these issues previously.”

Mosi said that about two months ago, discussions were had about how reports should be structured. “There was training and lots of money was spent, but there is still no improvement.”

He said the printing contract issue was not new. “The issue of the printing contract has always been there under different directorates. There was even a plan that said there must be movement three months before the contract expired. But it’s clear no one wants to do this work.”

ANC councillor Xolani Notshe said the responsible officials had to be held accountable for the role they played in the postponement of the meeting.

“When we sit here as MPAC, one would think we want to improve our city. If we don’t do what we’re supposed to do, we’re delaying ordinary residents’ basic services. Our work here is not just to look at these reports – there’s a bigger vision.”

DA councillor Werner Senekal said if the city failed to stick to the basics of issuing an agenda on time, then it was perhaps time to shift the blame on to the officials.

“We also would like for this meeting to be postponed, it’s ludicrous to expect councillors to read over 1,400 pages. I received my agenda on Monday, which was our [DA] caucus day for council. So it’s impossible that I got through all the items.”

Standing in for Ngoqo, acting city manager Nosipho Xhego said she noted the complaints.

“I must indicate that the matter was brought to my attention. I will document all the challenges presented in the report that will be brought here. I will also answer as to where we are in terms of the contract. There is a comprehensive report.” DM