Page 183 - UGU Dstrct Mun IDP Report '21-22

Supply chain management
The Irregular Unauthorised Expenditure as a percentage of Total Operating Expenditure ratio norm is 0%. The current Ugu District Municipality ratio is more than 0%. The ratio that exceeds the norm
as is it is in the Ugu case, points is poor procurement planning. Furthermore, there is a lack of understanding that SCM must also facilitate economic transformation agenda and as a result there is no alignment
Revenue management
The norm for the Collection Rate is 95%. The current Ugu District Municipality Collection Rate is 79% for urban accounts and 12% for rural. The rate that is below the norm is an indication of poor performance in a number of areas, in the Ugu case these are:
• Quality of Credit Control - there is poor management of debtors as a result the municipality is not
collecting. As at 30 June 2017, the total outstanding debt was R 364 443 614.01 and 52.8% of that
debt was over a year.
• Quality of Revenue Management – there is a challenge with the structuring of tariffs as there is no
cost recovery for water and sanitation provision.
Asset management
Issue of incorrect asset register, unbundling of infrastructure, asset replacement and management plan
Non-compliance with MFMA
There is a lack of financial internal controls and processes
Expenditure management
The norm for the Creditors Payment Period Ratio is 30 days. Currently the ratio for Ugu District Municipality is more than 30 days. A period of longer than 30 days to settle creditors is normally an indication that the Municipality may be experiencing cash flow problems, however in certain instances this may be as a result of disputes, processing of payments, etc. In addition, a ratio that exceeds the norm indicates that the Municipality may not be adequately managing its Working Capital or that effective controls are not in place to ensure prompt payments.
Good Governance and Public Participation
Poor Communications and stakeholder Engagements
The municipality has endured bad publicity over the past few years which was mostly fuelled by
the challenges that were experienced in water provision. The municipality’s communication and stakeholder engagements were tested and a couple of weaknesses were identified. What the communication analysis also found is that the communication field is vastly becoming digital and the municipality is lagging behind in this aspect.
The internal communications standard practices are not adhered to which leads to miscommunication and communication breakdown between departments. This has had an adverse effect on service delivery and has resulted in unnecessary delays in the implementation of projects and programmes.
The external communication is urban biased and is limited in the hinterland. The main language of written communication is English which further marginalises the rural hinterland. Furthermore, there is no standard system in place to engage stakeholders and lack of stakeholder analysis.
Customer services not being embraced internally but rather seen as an external service, there is no systems in place to ensure that this is being done. The communication strategy needs to be reviewed to accommodate the rapidly changing communication environment. Customer satisfaction survey needs to be undertaken. The Batho Pele needs to be re-institutionalised as well.
Disintegrated Public Participation
Public participation is a key element of ensuring that the public is consulted and is involved in the running of the municipality. The current public participation mechanisms are not as effective as they should be. Furthermore, there is no standard coherent system followed by different municipal departments to consult the public. There is a need to review the Public Participation Strategy
and explore new innovative public participation mechanisms. Revitalisation of ward committee engagements needs to also be explored.
Lack of Inter Departmental Collaboration
There is a lack of Internal partnerships in terms of projects being implemented for the community which results in duplication because departments are not talking to each other.
Unfavourable Environment for Civil Society Group to Participate
in Municipal Structures
Most of the organised civil groups representatives are unemployed. Due to the vastness of the district, travelling for these representatives become too expensive and they often have transport challenges. This limits the civil society participation and representation in the municipal structure. The challenge will be further exacerbated the cost cutting measures of the municipality. The organised civil groups representative that participate in the municipal structure will have to also bear the cost of providing their own lunch.
IDP REVIEW 181