Provincial auditor-general (AG) Thobile Ntetha has laid bare before the national parliament his office’s frustrations of working with Buffalo City Metro and its development agency’s officials when his auditors were conducting their assessment for the 2024/2025 financial year.
Ntetha told the multiparty parliamentarians that their work in this period had been marred by some disruptions, which were as a result of “audit contestations” and “disputes” lodged by city officials regarding the AG’s findings in its 2023/2024 assessment report.
The disputes were so disruptive that the BCM development agency’s latest audit report, which was meant to be signed off by Ntetha in November and tabled before council in late January, had yet to be signed off.
This, Ntetha said, was a result of the agency disputing some of the AG’s findings relating to the stalled and troubled Water World Fun Park project.
Amid audit contestations and disputes, he said, the city’s latest audit report was eventually signed off after some intervention from the National Treasury.
In its previous assessment, the AG’s office had made some material findings regarding the Water World project, a multimillion-rand facility that remains non-operational, in a shambles, and further deteriorating, while more than R100m had already been spent towards its upgrades.
Ntetha, however, did not go into details on which finding BCMDA officials were disputing, and which resulted in delays in the signing-off of their latest audit report.
Ntetha revealed this on Wednesday while appearing before parliament’s finance watchdog committee, Scopa, to present the latest audit findings relating to both the troubled BCM and the OR Tambo district.
BCM, for the third consecutive assessment, again obtained a qualified audit opinion, while OR Tambo obtained an unqualified audit with some findings.
Ntetha, together with some Scopa members, also raised concerns that BCM had paid more than R18.1m in the year under review to private consultants that assisted them with their financial reporting and asset management.
There was little to show for it, in terms of improved audit outcomes, while the quality of submitted financial statements to the AG remained poor.
The 2024/2025 figure was almost double that to consultants in the previous 2023/2024 assessment, where R9.4m was paid.
Ntetha said the work of consultants in BCM was not adequately reviewed, responsibilities were not appropriately defined between consultants and the municipality, and there were no clear monitoring, reporting or evaluation mechanisms.
The reason the metro relied on consultants, Ntetha said, was a “combination of lack of skills and vacancies”.
However, “no proper needs analysis was performed in terms of skills shortages and vacancies before appointing consultants, there is inadequate skills transfer from consultants to municipal officials, and the accounting officer [city manager Mxolisi Yawa] has not developed a formal consultancy reduction plan”.
EFF MP Veronica Mente attributed the use of consultants and the lack of their adequate review to the metro’s finance office, saying this showed that it lacked skills and was not equipped to review the work of consultants, “while they themselves have no clue”.
Accountability there was lacking, and I urge the committee to dig deeper with them on this
— Thobile Ntetha, provincial auditor-general (AG)
Speaking on the use of consultants, Ntetha said: “There were a lot of contestations around their assets, until the mayor [Princess Faku] intervened.
“Consultants would say one thing, while officials would say something else.
“We spent most of last year debating 2023/2024 audit findings, and only when the mayor intervened in October did we find traction in the audit process.
“Accountability there was lacking, and I urge the committee to dig deeper with them on this.
“When we signed off the 2023/2024 audit report, there was of course contestation, and we had to sign off that report when the National Treasury intervened, saying to BCM they had to accept such findings as they had merit,” Ntetha said.
The AG’s officials, he said, had moved in early to assist BCM.
“But they will tell you that every discussion around assisting them to improve audits will always go back to them questioning our findings.
“These are some of the things you need to unpack with them, in terms of the how and why, but there was a lot of contestation, both that year and this year under review,” Ntetha said.
MPs also raised concerns about deviations in the awarding of contracts in BCM, the inclusion of 214 non-deserving beneficiaries in the list of indigent residents, use of contractors not properly registered, the poor state of the city’s wastewater treatment plants, and lack of consequence management.
Committee chair and Rise Mzansi MP Songezo Zibi said his committee would host the Special Investigating Unit (SIU) next week to discuss some of their investigations at BCM and the OR Tambo district.
The two councils will get a chance to respond for themselves when they appear before the committee early in March.
Daily Dispatch
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