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Treasury Plans to Withhold Funds From Free State Municipalities

The people of the Free State should no longer be the victims of municipalities’ financial crises. Last week, the Minister of Finance, Enoch Godongwana, indicated in a letter (attached) to the Minister of Cooperative Governance and Traditional Affairs (COGTA), Velenkosini Hlabisa, that his department is considering withholding the equitable share funds of eleven Free State […]

The post Treasury plans to withhold funds from Free State municipalities – Freedom Front Plus demands answers appeared first on Freedom Front Plus.

The people of the Free State should no longer be the victims of municipalities’ financial crises.

Last week, the Minister of Finance, Enoch Godongwana, indicated in a letter (attached) to the Minister of Cooperative Governance and Traditional Affairs (COGTA), Velenkosini Hlabisa, that his department is considering withholding the equitable share funds of eleven Free State municipalities due to ongoing financial mismanagement.

Godongwana’s reasons behind this drastic step include unfunded budgets, constant defaulting on water board accounts and unpaid third-party contributions.

Hlabisa was supposed to submit written representations to the National Treasury (NT) by Thursday.

While the NT has a constitutional duty to safeguard state funds, withholding these funds will have far-reaching consequences for residents.

Meanwhile, the Freedom Front Plus asked the Free State MEC for COGTA, Saki Makoena, to explain how his department plans to effectively intervene in municipalities that squander their equitable share funds on exorbitant wage bills, instead of using the money for residents’ benefit.

These funds are primarily intended for service delivery.

In addition, unpaid third-party contributions amount to hundreds of millions and debts owed to water boards equal billions. This is not sustainable.

Withholding funds from struggling municipalities is not enough. All three levels of government have a responsibility to ensure that residents’ rights are protected.

The party also asked the provincial government, in the relevant portfolio committee in the Free State Legislature, to clarify how it will address the ongoing mismanagement.

The following municipalities may forfeit funds:

  • Matjhabeng (Allanridge, Hennenman, Odendaalsrus, Ventersburg, Virginia, Welkom)
  • Maluti-A-Phofung (Harrismith, Kestell, Phuthaditjhaba)
  • Kopanong (Bethulie, Edenburg, Fauresmith, Gariep Dam, Jagersfontein, Philippolis, Reddersburg, Springfontein, Trompsburg, Waterkloof)
  • Letsemeng (Jacobsdal, Koffiefontein, Luckhoff, Oppermansgronde, Petrusburg)
  • Mohokare (Rouxville, Smithfield, Zastron)
  • Masilonyana (Soutpan, Theunissen, Verkeerdevlei, Winburg, Winnie Mandela (Brandfort))
  • Nketoana (Arlington, Lindley, Petrus Steyn, Reitz)
  • Phumelela (Memel, Vrede, Warden)
  • Ngwathe (Edenville, Heilbron, Koppies, Parys, Vredefort)
  • Mafube (Cornelia, Frankfort, Tweeling, Villiers)

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