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Nelson Mandela Bay’s Chief Financial Officer Trevor Harper says that the capital budget relating to the Integrated Public Transport System (IPTS) was overspent by approximately R126.8 million in the last financial year.
In a report to the Budget and Treasury Committee, Harper says this constitutes unauthorised expenditure.
Further, he states, the unauthorised expenditure on the project “has resulted in a decline in the municipality’s cash position and has placed the funding status of the 2014/15 Budget at risk”.
In addition, he says, it has also contributed to the cost coverage ratio only being 1.06 months at the end of September this year.
This is below the target of 1.5 months and is well below the figure of 2.08 months recorded at June 30 of the first quarter of the current financial year.
In his Quarterly Financial Report for the period July to September 2014, Harper reports that the actual average debtors’ collection rate at September 30 was 92.2%, which is below the target of 94% set in the Integrated Development Plan (IDP).
It is also below the figure of 93.71% recorded in June this year.
Harper is also concerned about the Housing Revolving Fund that at this stage does “not indicate any significant improvement”.
He says that despite various requests to the Human Settlements Directorate “to provide strategies on reducing the threshold of the revolving fund,” he is not aware of any such strategies”.
Neither, he adds, has there been “any significant reduction in the threshold of the revolving fund”.
Harper points to two categories of projects where expenditure be claimed immediately, one of which concerns old projects where “claims are not possible due to outstanding verification documentations”.
The second is where claims are not possible because the beneficiary management process has not been finalised.
The CFO adds that this is “an ongoing serious challenge which must be addressed by both the municipality and the Provincial Department of Human Settlements”.
(Source: Metro Minute to subscribe mail metminutes@iafrica.com)
