The world is changing fast and to keep up you need local knowledge with global context.
By Alan Norman*
Local Government is our shop window that potential investors look through to assess the desirability of investing in South Africa.
At present, our shop window for investors is enough to put any potential investor off for all times.
On passing through the door our potential investor is met by an official who knows little about what his council has to offer the investor and besides could not be bothered to find out, its nearly lunchtime.
Our potential investor, on being turned away drives around the town to assess for himself whether he should invest here and what does he find?
- many of the traffic lights don’t function
- the roads are full of potholes
- there are numerous burst water mains that have obviously been unattended to for some time
- the gutters are clogged with weeds a meter high
- the pavements have not been upgraded for years
- the electricity service is non reliable as reticulation systems have not been maintained and Eskom is threatening to cut off supply for non payment by council, etc etc…
Our investor then decides to obtain [with great difficulty] a copy of the council’s latest audited annual report and what does he find?
- the audit report is qualified because of tender irregularities and the lack of any kind of filing systems
- the council is insolvent and cannot pay its creditors
- the total rates income which escalates annually is only sufficient to cover the cost of staff & council salaries, bad debts and losses on the electricity service with no provision for the maintenance of any council assets
- the procurement department is staffed by untrained personnel one of whom is related to a councillor who is awarded most of the tenders
- the municipal manager was previously a teacher so knows nothing about municipal finances, the audit committee seldom meets and is chaired by somebody with no financial management experience.
My dream for 2017 is that the rampant mismanagement of many of our local government institutions is arrested before they become totally dysfunctional and act merely as a conduit to employ cadres from the ruling party.
My dream is that failing local government bodies find the wisdom to consult the wealth of knowledge available amongst our retired professionals who would be willing to provide their services at no cost or very little, for the purpose of getting our beloved country on the road again. It is possible, all that is needed is for those in power to pocket their pride and recognise that help is needed otherwise our beloved country will just be another Zimbabwe with 80% unemployment and many people starving. Surely this was not the vision of Luthuli, Tambo and Mandela. South Africa has a bright future if only our politicians realise it can only reach its maximum potential by utilising all the skills available in the country.
- Alan Norman is a retired C.A.SA. . He was an audit partner in one of the big four firms of accountants specialising in local government finances.
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