The role of the Auditor-General in the promotion of efficient financial management in municipalities: a case study of the North West province
Mathiba, Gaopalelwe Lesley
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That South African municipalities, in vast majority, are experiencing serious financial problems is well-known to anyone with an interest in local government sector. Given that, the study considers the role of the Auditor-General (AG) in promoting sound financial management in municipalities. The disciplinary perspectives from which the inquiry is considered are law and public administration. The context for this consideration is the North West, a province which is inundated by poorly performing municipalities that are literally on the brink of financial and operational collapse. The study proceeds from the premise that efficient financial management practices are essential to the long-term sustainability of municipalities. The role of the AG is key in this regard in that the latter is a watchdog over state coffers and the pivot of the oversight mechanism over the management of public finances. Furthermore, the AG strives to institutionalise and promote a culture of good governance, accountability and transparency in municipalities. It achieves this through routine auditing and provision of audit recommendations that seek to improve municipalities’ internal controls. However, this purpose gets undermined, and eventually defeated, in the instance where audit recommendations are being ignored. Of concern is that the non-implementation of audit recommendations has become a norm in most municipalities in the North West. The study has considerable breadth in its analysis of this problem by looking closely into three municipalities: Mahikeng, Ditsobotla and Tswaing. It is not immediately clear why this trend is emerging or has emerged. In that note, a resolve to embark on this study was impelled by a sense of commitment to try to understand the real issue behind this trend and to see how best it can be countered. This brings the study to then ask: How can the AG’s recommendations be better and adequately given effect in the North West municipalities? In response, it will be argued that this issue cannot be solved by the AG alone. What is needed, instead, is the development of an action plan, policy and institutional framework that will guide and facilitate the multi-agency approach and inter-institutional collaborations towards addressing the problem. Further argument will be advanced to say that the efforts undertaken to reconstitute and strengthen the legal framework governing the AG through the 2018 amendments to the Public Audit Act do not constitute a magic bullet solution to the dismal downward trajectory across the North West municipalities, as contemporary narratives seek to suggest.