The department of water and sanitation has requested the national treasury to withhold Matjhabeng’s grant funding because of ongoing failure to comply with the Municipal Financial Management Act.

In a letter to national treasury director-general Duncan Pieterse, director-general Sean Phillips called for urgent financial action, citing repeated issues about how Matjhabeng manages its finances.

Phillips noted that Matjhabeng has a large debt to the Vaal Central Water Board, which provides bulk water to several municipalities, including Matjhabeng. This municipality has not paid its bills, and the water board is now on the verge of collapse, owed over R6 billion by Matjhabeng alone.

Municipalities such as Mangaung, Kopanong, and Nala also owe significant amounts. The water board’s ability to operate is at risk due to these unpaid bills.

Phillips explained that the board had tried many ways to solve the debt problem, including sending reminders, having meetings to discuss the debt, and taking legal action. “In all these engagements, municipalities were participants or had been invited,” he said, stressing that Matjhabeng needs to meet its payment obligations.

‘It’s left Vaal Central Water unable to repair, maintain infrastructure’

Due to Matjhabeng’s debt, the water board is struggling to maintain its infrastructure. Phillips requested that treasury should consider using Section 216(2) of the constitution, which allows the withholding of funding from municipalities that don’t comply with financial management rules.

In February, Matjhabeng’s debt reached R6.3 billion, of which R5.7 billion is overdue for more than 120 days. It’s left Vaal Central Water unable to repair and maintain crucial water infrastructure needed for service delivery.

To tackle the debt, the water board suggested that the treasury hold back Matjhabeng’s grant funding until a payment plan approved by the council is confirmed. Once an initial payment is made, the treasury could release the remaining funds based on Matjhabeng’s continued compliance with the payment plan.

This approach aims to prevent further financial decline for Vaal Central Water and ensure critical water services continue despite the municipality’s financial problems.

OFM News/Kekeletso Mosebetsi cg