Government departments owe a small South African municipality R45.97 million

The provincial and national governments owe the Setsoto Local Municipality R45.97 million in unpaid municipal accounts.

This was revealed in detailed account information supplied by the municipality in response to a question to the council.

The Setsoto Local Municipality is located in the eastern region of the Free State and borders the Kingdom of Lesotho.

It falls under the Thabo Mofutsanyana District Municipality, and its administrative seat is the agricultural town, Ficksburg.

The region forms part of South Africa’s key grain belt, producing maize, wheat, and sunflowers, and is also known for livestock production.

Ficksburg is internationally recognised as the Cherry Capital of South Africa, holding the annual Cherry Festival.

The Setsoto Local Municipality faces service delivery challenges which stem from an ageing infrastructure, financial distress, and operational mismanagement.

The high rate of non-payment for municipal services, compounded by poverty and weak billing systems, leaves the municipality with limited capital expenditure budgets.

The non-payment extends to government departments. Jose Coetzee, a councillor in the Setsoto Local Municipality, shed light on this issue.

He said that the account information supplied by the municipality showed that government departments owe it R45.974 million.

This includes provincial government debt of R38.105 million and national government debt of R7.869 million.

“This means that more than 82% of the outstanding government debt is attributable to provincial government accounts,” he said.

The biggest offenders are the Free State departments of education, health, and public works, roads and transport.

• Education – R13.50 million
• Health – R8.62 million
• Public Works, Roads and Transport – R7.00 million
• Agriculture – R6.35 million
• Sport, Arts and Culture – R2.63 million

“The figures are particularly concerning given that Setsoto continues to face financial and service-delivery pressures.”

Coetzee said that what alarmed him the most was the municipality’s careless response regarding debt collection.

“It has been confirmed that no formal notices have been issued in respect of these government arrears and that no legal action has been initiated,” he said.

“Residents and businesses cannot be expected to carry the financial burden while organs of state accumulate tens of millions of rand in arrears.”