Cape Town - The Western Cape Government has given the green light for an intervention in theTheewaterskloof Municipality.
This comes after evaluations of the municipality’s financial situation, which revealed concerns about its capacity to provide services to the community.
Finance and Economic Opportunities MEC, Deidré Baartman, said the municipality has been struggling with ongoing financial issues, including rising debt, serious cash flow problems, and difficulties in collecting revenue.
She said this has limited the municipality’s ability to fund service delivery and procure goods, services, and credit.
“This intervention is, therefore, essential to restore financial stability, and to ensure the continuation of services,” Baartman said.
The municipality’s financial position rapidly declined between 2022 and early 2023.
During this period, the municipality consistently collected over 95% of its planned revenue and closed the year with a surplus.
By August, the collection rate dropped to 64%, well below the National Treasury recommended norm.
“As soon as the financial decline became evident, Provincial Treasury and the Western Cape Department of Local Government sought to provide immediate assistance to ensure that the financial challenges and looming service delivery decline in Theewaterskloof were addressed,” Baartman said.
Nicholas Myburgh, DA constituency head in Theewaterskloof, said for the past three years, a PA/ANC coalition has driven the municipality to the “brink of financial ruin”, and basic services have suffered greatly as a result.
According to Myburgh, the DA/ GOOD/SRWP coalition tried to stop the rot by briefly forming a new government, but it was blocked by the FF+.
“The DA and its coalition partners, after the election of new leadership, will work together with the Provincial Government to ensure financial stability and improved service delivery for all,” he said.
In September, Theunis Zimmerman of the FF+ was elected as the new mayor, three weeks after Lincoln de Bruyn of the DA was sworn in as mayor.
However, Good Party secretary-general Brett Herron said the timing of the financial stress is closely aligned with the political instability caused by the DA, ANC and FF+ voting to remove the acting municipal manager from office.
“The new coalition should be elected into office this week. If we achieve that, then I’m confident we will bring about financial and administrative stability,” Herron said.
Leader of the opposition in the legislature and spokesperson for the ANC Western Cape, Khalid Sayed added: “We note the decision. We are concerned at the level of consultation. We are engaging and will communicate further in detail.”
Meanwhile, the conditions of the intervention now include appointing a financial administrator; the development of a financial recovery plan focusing on debt management; and regular monitoring and reporting mechanisms.
Cape Argus