Godongwana withholds grants from municipalities owing water boards

FINANCE Minister Enoch Godongwana has informed his Cooperative Governance and Traditional Affairs counterpart, Velenkosini Hlabisa, that he intends to withhold millions of rand in grants to several municipalities due to their persistent failure to settle billions in debt.

- LOYISO SIDIMBA

The 39 municipalities are in the Free State, Gauteng, Mpumalanga, Northern Cape, North West, and Limpopo.

According to Godongwana, 18 defaulting municipalities owe the highest amounts to the four water boards facing imminent bankruptcy.

In total, the 18 municipalities owe Vaal Central, Magalies Water, Lepelle Northern Water, and Rand Water nearly R18 billion.

Matjhabeng Local Municipality in the Free State owes Vaal Central over R8.13bn. Kopanong and Mafube local municipalities, both in the Free State, were R330 million and R253.4m, respectively, in arrears for pension fund contributions.

Rand Water, Vaal Central, Lepelle Northern, and Magalies Water have been advised to enforce their credit control policies to also attach the bank accounts of defaulting municipalities to ensure a change in their behaviour.

Godongwana said pension funds were also owed about R820 million by 18 municipalities, while the Auditor-General South Africa's (AGSA) debt stands at R68.4m across six municipalities. He told Hlabisa on June 30 that SARS' outstanding debt was R197.5m across eight municipalities.