A SMAC in the Face #37:  ONO, It’s Laundry Day

In the old days, OMO washing powder advertised that it makes ‘whites bright’.  Definitely, that had to go and they’ve replaced it with some rather anaemic slogans.  Two-fisted punch was obviously a non-starter.  Not only was it already taken, it would make the laundry room feel like an unsafe space and the TV adverts would have to carry a trigger warning.  So, we are left with The Power of 10 Hands and Tough Stain Removal.

No matter what your preference is, there seems to be no detergent, mechanism or intervention that can deliver clean Municipal Audit Outcomes.  We are into the 29th year of the ‘New and Improved South Africa’ and the overall municipal finances are a disaster area.  Granted a Municipality has a very difficult job but, of all its functions, the easiest is to financially account for what it did do irrespective of whether it’s failing its mandate.  Accounting is a mechanistic process.  There is no need to reconcile conflicting human and political interests, being creative with solutions to intractable problems, extracting income from recalcitrant or poverty-stricken ratepayers, planning and regulation, generating and realising a vision, etc.  Once the accounting system has been set up properly, it’s mainly a case of following the recipe. 

Last week saw the Auditor-General release her annual report on this cesspool.  Of the 257 Municipalities, 25% (Western Cape – 3%) had going-concern problems.  Even more frightening was that 75% could not provide quality financial statements.  The Western Cape achieved 22 (73%) unqualified audit outcomes while the rest of South Africa received only 19 (8.4%)!  25 Municipalities (Western Cape – 0) seemed to take the modern trend of the paperless office to the point that the Auditor-General could not even begin to make adverse findings and just disclaimed them.  We do not know if this lack of paperwork is wilful to obscure corruption or due to incompetence and slackness.  I suspect a combination.  Most disaffected whities would automatically blame corruption, but that is contradicted by the creditors books which run at an average of 275 days (excluding the WC – 63 days).  Normally deals involving corruption are sorted out fast.  Also, the debtors books, running at 220 days (excluding the WC – 49 days), indicate that the financial systems have all but collapsed.   In the Free State, the creditors and debtors books are running at eye-watering 483 and 563 days respectively and for the Northern Cape they are 527 and 167.  There are many other metrics but they all tell the same grim story, just from different angles – barring the Western Cape which stands out as a beacon, the financial systems of the municipalities are chaotic and dysfunctional and that they haven’t collapsed yet is a miracle.

But what is glaringly obvious is the lack of consequence management otherwise these problems would not persist year after year.  Maybe we do need some two-fisted punch after all.

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