Auditor-General Kimi Makwetu filed his last national annual report, covering the financial year 2018-2019. Its overall findings were dismal – yet some glimmers of hope have been blotted out in journalistic coverage.

The Sunday Times covered the report on 5 July under the headline ‘If this is not corruption, then what is? – AG’. The piece, by Andisiwe Makinana, makes telling, depressing points about the lack of accountability in hundreds of South Africa’s  municipalities.

Makwetu is quoted as saying that while private sector ‘tills’ are ‘watched’ and ‘there are consequences for cashiers whose tills are short at the end of the day’, all too often, the wrong ‘hands’ are ‘at the till’ in the public sector, and pilfering goes unpunished.

‘People do not care. They just come to the till because they know there are not many cameras to see them,’ Makwetu told the Sunday Times.

One genuinely promising line was reported, however. Makwetu said that he looked forward to spending some months tending goats in peace after stepping down in November – and thereafter getting back into the game of ‘creating jobs and rebuilding the economy …but certainly not in the public sector’.

Market forces

There is some corruption in the private sector too, but Makwetu is right to trust that market forces tend to produce salubrious outcomes, and his expert discipline will surely be welcome there. Private enterprise remains a source of hope and robust value-add.

Unfortunately, the same Sunday Times piece suggests a false promise, claiming that the Zuma years were ‘the height of the looting’, as if we are over the hump.

This claim is undermined by the 27% increase in ‘irregular expenditure’ from the 2017-2018 reported figure (R25.2 billion) to the latest figure (R32.06 billion), which is certain to be an understatement since 55% of municipal audits were ‘qualified’ because spending disclosures were incomplete.

In 2016/2017, there were findings of ‘unfair and uncompetitive procurement processes’ at 80% of municipalities, but in the latest report that has climbed up to 90%.

The total amount of expenditure that ‘has not been dealt with’ stands at R65.59 billion, according to Makwetu.

Unqualified opinions

Is the public sector entirely corrupt? According to the report, the ‘largest concentration of clean audits was in the Western Cape (45%), with 93% of the provinces municipalities receiving unqualified opinions on their financial statements [emphasis added]’.

This did not come about overnight. In 2014’, John Steenhuisen noted that ‘every year since [the Democratic Alliance (DA)] began governing in the Western Cape in 2009’ the result had been ‘better audit reports at municipal level’.

In 2009, there was one clean audit in the Western Cape. In the latest report there were 13, all led by the DA either outright or in coalition.

In addition, the only Gauteng municipality to obtain a clean audit, Midvaal, is also led by the DA, bringing its clean audit total to 14. Compare this with the ANC’s 6 clean audits, nationally.

The DA governs around 10% of SA’s municipalities, but obtained 70% of the country’s clean audits. This reminds one of the old ‘80-20 rule‘, only more so.

Deficits are up

Nationally, municipal deficits are up, and the average creditor-payment period is up from 146 days to 180 days, while 68 municipalities (30%) are now officially in a ‘vulnerable financial position’. Despite suffering the consequences of a shrinking national economy, the Western Cape had the ‘strongest’ financial health ‘of all the provinces.’

The Sunday Times’ made no mention of this. If there is an argument against the improvement over time and the outperformance at this time of DA municipalities, wouldn’t the AG’s Annual Report be a good moment to discuss that possibility?

Stranger still in its opacity on the basic democratic question is this piece by experienced journalist Estelle Ellis in the Daily Maverick. It analyses a R30 million rand grant in Dr Beyers Naude Municipality (which includes the towns of Graaff-Reinet and Willowmore), in the Eastern Cape, only R5 million of which can be traced, as well as other corruption allegations at the municipality.

What Ellis does not mention is that, as disappointing as the allegation of looting is, there is a glimmer of hope breaking through the murky clouds for residents of the municipality, which borders on the DA’s Western Cape; in 2016, the ANC won 51.1% of the vote in Beyers Naude, the DA 46.6%.

There is a municipal election coming up next year in Dr Beyers Naude Municipality. The old fashioned democratic system for replacing the demonstrably corrupt with a team of proven record might be triggered. In any event this municipal election will be one to watch, think about and analyse in advance.

Ultimate guardians

We live in a democracy, which means citizens and the ‘citizen-journalists’ among them are the ultimate guardians of public property, policy and personnel appointments. This system does not work as well as it should if the fundamental connection between the ballot box and the public balance sheet is obscured. Makwetu has earned his leisure to gaze at goats for a while; the rest of us had better follow the democratic arithmetic while something, at least, remains in the till.

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Image by Charles Thompson from Pixabay

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