IOUs will cause fi­nan­cial trou­ble for mu­nic­i­pal­ity

The New Age (Free State) - - NEWS - KAMOGELO SEEKOEI kamo­ge­los@the­newage.co.za

THE Thabo Mo­fut­sanyana district mu­nic­i­pal­ity may be head­ing for fi­nan­cial trou­ble with a short­fall of 13% pur­ported as the new fis­cal year be­gins in July.

With an an­nual bud­get of about R100m, the use of IOUs will mean that the mu­nic­i­pal­ity will start the new year with a 13% short­fall.

This is ac­cord­ing to the DA, which said in a state­ment that the district needed in­ter­ven­tion from the pro­vin­cial govern­ment.

The party said the district was fast run­ning out of money due to “reck­less spend­ing”.

In the meet­ing, it was pro­posed that the mu­nic­i­pal­ity ap­plied for a R5m over­draft and cut spend­ing dras­ti­cally. How­ever, the ANC said sup­pli­ers should be given “IOUs” and be per­suaded to ac­cept pay­ment in the new fi­nan­cial year, which would leave a short­fall.

The district has ju­ris­dic­tion over Ma­luti-A-Pho­fung, Nke­toana, Set­soto, Phumelela, Mat­sopa and Dih­labeng lo­cal mu­nic­i­pal­i­ties.

In the last coun­cil meet­ing, it re­vealed that at the cur­rent rate of spend­ing, the mu­nic­i­pal­ity ran the risk of hav­ing a R 14.5m short­fall in its bud­get by the end of the fi­nan­cial year, which ends in June.

The New Age could not get hold of the co­op­er­a­tive gov­er­nance head of depart­ment to de­ter­mine if any kind of as­sis­tance will be pro­vided to the mu­nic­i­pal­ity.

DA coun­cil­lor Alison Oates said she would re­quest the Mu­nic­i­pal Pub­lic Ac­counts Com­mit­tee to make an ur­gent in­ter­ven­tion in Mo­fut­sanyana to en­sure the cri­sis was averted.

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