Committees last hope against BCM graft
THE Buffalo City public accounts committee recently published its oversight report on the annual report. For a committee of councillors they seem to be unusually in touch with the crisis that confronts BCM. But many will be asking – can they do anything about it?
While we the public fume and bluster impotently about Buffalo City’s weak services and dodgy deals, there are a handful of technocrats and councillors working desperately to keep some semblance of governance and accountability alive in the city.
While it may be hard to countenance a situation worse than the chaos at EL City Hall, we have to wonder where we’d be without the valiant efforts of the National Treasury and the Auditor General (AG).
Treasury officials and auditors, however, do not run municipalities. Municipal governance, or the lack thereof, hinges on the managers and councillors who get their hands dirty in service and development programmes and committee work.
In all municipalities there are two committees in particular that are well positioned to stem the slide towards waste, maladministration and fraud.
The municipal public accounts committee (MPAC) mirrors the general function of public accounts committees in government. MPACs try to ensure that elected structures, like our local council, are able to hold the executive and the administration to account for the effective and efficient use of public resources.
Public accounts committees execute this function by reviewing public accounts and exercising oversight on behalf of the larger elected body, usually the legislature or in this case, council as a whole.
In 2012 National Treasury told municipalities to stop the political waffling and to start using a revised template for municipal annual reporting that required performance claims to be underpinned by evidence. Annual reports must now speak to plans and service targets and must focus on probity and integrity safeguards.
MPACs have the oversight responsibility to make sure this happens.
In early April Buffalo City MPAC published their oversight report. It’s a hefty and detailed interrogation of most of the failings that our city’s residents have come to expect and dread. Answers for service failure and irregular expenditure (the AG regards the official figure of R781.1-million as understated) are duly demanded.
The MPAC makes these demands not just from the directors of roads, community services and other departments but from the municipal manager and the mayor.
But the MPAC is, in the final analysis, simply another committee of council and cannot hope to match the political weight of the mayoral committee.
The majority of councillors that serve on it come from the ruling party. If they overstep the mark, they will answer not to the public, Treasury or the Auditor General but to their own party.
A similar but more autonomous oversight role is played by the audit committee.
The audit committee (AC) is an independent governance structure whose function is to provide oversight of internal financial control, risk management, and governance, but mainly financial governance.
Buffalo City’s audit committee is chaired by an independent chartered accountant, Velile Pangwa. It met seven times in the previous financial year.
Like all audit committees it may not include councillors and its role is purely advisory. Much of the diagnostic work that informs its findings is done by the AG, hence the AC reports closely mirror those of the AG.
In BCM’s case the problems are glaring and persistent, namely a lack of internal controls, failure to implement council resolutions, a supply chain management (SCM) policy that is either ignored or manipulated to serve vested interests, instability within the senior political leadership and outright antagonism between political and administrative leadership – epitomised in the tension between the executive mayor and the municipal manager.
This is not an opinion, it is the documented findings of BCM’s own AC based on the AG’s reports.
It is common cause that SCM is the priority issue for BCM. The AC also notes the lack of capacity and skills for tender processes – perhaps giving BCM the benefit of the doubt.
However, it says: “It’s a matter of material concern to the committee that management has not been able to act prudently in this regard.” Procurement issues, as they are known, included improper advertising of tenders, not keeping the tender register up to date and not properly assessing black economic empowerment criteria in informal tenders.
More serious infringements include awarding tenders to people in state jobs, incorrectly handling and reporting deviations from SCM policy and unnecessary appointment and poor management of consultants.
Many matters relate to the use of nonregistered suppliers within the construction industry – some of whom were not even solvent.
BCM management often disputes these findings, for example in some cases management claimed that tendering companies had made false declarations of their links to the state or that tender deviations were necessary and correctly approved.
The situation in BCM is remarkable because all the key roleplayers – be it MPAC, the AC, AG, Treasury, local media and to some extent even the community structures and ratepayer bodies – are roughly on the same page. Outweighing this “consensus of rationality” is the realpolitik and calculated lethargy of management and leadership itself.
It might seem naïve to expect committees to install sound governance at BCM. Indeed as the AG notes, “The recommendations of the audit committee and internal audit unit are not adequately implemented by management.”
On the other hand a political solution seems unlikely given the factionalism and dearth of political leadership from the ruling party and the opposition’s seeming impotence to effect even the smallest improvements.
Warnings by the MEC and National Treasury have about as much effect as paintballs against a Sherman tank.
Perhaps then, we have no choice but to rely on one of the oldest bureaucratic traditions – the plodding but inexorable power of the committee.
It would be ironic indeed if the looting of public resources was stemmed not by political change or community protest but the stubborn insistence on answers by two uppity committees.
A political solution seems unlikely given the factionalism and dearth of political leadership from the ruling party and the opposition’s seeming impotence to effect even the smallest improvements
Glenn Hollands is a local government consultant