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NMB permanently loses half a billion rand as National Treasury impasse drags on

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Dear MyPE

The Nelson Mandela Bay Municipality has now permanently lost R503 million in grant funding that was earmarked for, amongst others, infrastructure development and drought mitigation measures.

The ANC Coalition of Corruption must take full responsibility for this devastating financial blow that was dealt to residents, as it is their desperate clinging to power and blatant disregard of the law that has brought us to this point.

This distressing turn of events stems from the current impasse between the Metro and National Treasury, who have refused to allow the rollover of the R503 million in unused grant funding from the 2019/2020 financial year.

This funding consists of:

  • Urban Settlement Development Grant (USDG) – R300 million
  • Disaster Relief Funding – R183 million
  • Neighbourhood Development Partnership Grant (NDPG) – R20 million

Unlike the funds that have been withheld by National Treasury to date, which could still be paid to the Metro if their conditions are met, when funds are not allowed to be rolled over, the unused funds are deducted from the next respective grant allocations. The funding is, effectively, lost forever.

National Treasury has not made a single payment to the Metro since December 2019.

To date, National Treasury has already withheld just under R1,6 billion in grant funding (R754 million from the 2019/20 financial year and R839 million from the current 2020/21 financial year).

The Metro is waiting with bated breath on a tranche of R340 million in grant funding from National Treasury, which was due to be paid this week. If these funds are also withheld, it will take the Metro close to R2-billion out of pocket.

Amongst the key demands that the City received from Treasury are:

  • The vacancy for Executive Mayor must be filled.
  • A qualified Municipal Manager has to be lawfully appointed.
  • Recommendations on Forensic Investigations need to be implemented.

On 10 November of this year, the Port Elizabeth High Court upheld its earlier decision that the Nelson Mandela Bay Speaker, ANC Cllr Buyelwa Mafaya, must call a council meeting to, amongst others, elect an Executive Mayor within seven days. On 17 November, in a separate case, the Grahamstown High Court also ruled that a council meeting must be held within seven days.

It is now imperative that a council meeting is held, and that the first order of business is the election of a new executive mayor.

The second order of business must be to give clear instructions to the acting city manager, to pull out all stops and resolve the impasse with National Treasury. The City is in financial crisis; service delivery is grinding to a halt. We cannot afford to lose any more money.

The DA will make sure that good governance and accountability return to Nelson Mandela Bay and will work tirelessly to turn this Metro around. We can fix this mess – we have done it before, and we will, together with our coalition partners and the people of Nelson Mandela Bay, do it again.

Regards

Cllr Malcolm Figg
DA NMB Spokesperson for Budget and Treasury

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Port Elizabethan

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