Nelson Mandela Bay mayoral discretionary fund overspent by R2.2m

The mayoral discretionary fund has been overspent by R2.2m in the last two financial years, with Nelson Mandela Bay acting mayor Thsonono Buyeye hoping the council approves a cash transfer to cover the debt.

This is according to a report meant to be debated at a council meeting held on October 2.

However, the meeting was eventually adjourned and rescheduled for Friday. .

In line with municipal policy, the mayor is allocated a discretionary fund — which was reduced from R4.8m to R2.4m in the 2019/2020 budget.

For the 2020/2021 financial year, R1.5m was allocated to the fund, with R1.3m remaining to date.

The mayor can use the money to support those facing hardship, or residents needing financial assistance for welfare or sporting events.

The money must also be used to enhance the image of the council, according to the fund’s policy document.

According to a report in the council agenda, Buyeye has requested a virement — transferring money from one financial account to another — to top up the fund.

This would be done by reducing:

• The “special programmes and national pride celebrations” budget by R1.5m;
• The “special projects” budget by R500,000; and
• The “civic entertainment” budget by R200,000.

If it had been approved, the R2.2m would have been transferred into the mayoral discretionary fund.

“The virements are required to settle commitments made towards organisations and individuals relating to donations or financial assistance the mayor resolved on and duly approved using mayoral resolutions,” Buyeye wrote in the report.

“Budget is confirmed subject to compliance with the essential management policies of the municipality and all other relevant policies and legislation.

“The submission is supported and it complies with the Municipal Finance Management Act supply chain policies and procedures and relevant financial processes, provided the processes are followed.”

The “special projects” budget caters for the sterilisation of dogs and the provision of ear tags for cattle, however, it was decided not to implement some projects in the 2019/2020 financial year.

This, according to Buyeye, when contacted, was done in case a virement was needed in the future.

The “civic entertainment” budget funds international and inter-governmental civic receptions.

“No particular event was affected by the decision due to the virement,” Buyeye said.

The “special programmes and national pride celebrations” are events celebrating public holidays but costs are often covered by the provincial government.

“Sometimes the local authority is requested to assist with services which need budget for.

“However, none have been affected in this instance.”

He said commitments mentioned in the report stemmed as far back as the 2018/2019 financial year, with payments made in the 2019/2020 and 2020/2021 fiscals.

“Requests varied from assistance for destitute funerals to church welfare and sport organisations applying for assistance, mainly for youth programmes.”

Buyeye did not respond to a question asking if UDM councillor Mongameli Bobani had made the commitments during his tenure as mayor from August 2018 until December 2019.

Bobani, when contacted, said he would support Buyeye’s recommendation.

“Everything is procedural in this item, I will support it.”

In October 2019, The Herald reported how Bobani had spent R5.9m of the fund for a picnic, pageant, and other projects.

His generosity seems to have known no bounds, with some smaller payments authorised for school uniforms, tuition fees and dozens of funerals.

In the October 2 council agenda, municipal budget and accounting senior director Jackson Ngcelwane urged Buyeye to revisit the guidelines for the mayoral discretionary fund, as this had not been done since 2000.

In the April 18 letter to Buyeye, Ngcelwane agreed that three organisations be paid the money owed to them through the discretionary fund.

However, he cautioned Buyeye to be careful going forward as the fund could easily be abused.

“Let us remember that, as an example due to the Covid-19 pandemic, many events that were to be held by sporting bodies and other organisations were cancelled due to the state of emergency,” Ngcelwane wrote.

“Would we be prepared to fund events that are no longer going to take place with public funds?

“We must urgently relook at the policy guidelines relating to the utilisation of the mayoral discretionary grant, as these guidelines were prepared in early 2000 and have never been reviewed since.

“We must be aware that issues based on ‘discretionary’ are in their nature very dangerous as they may lead to abuse of municipal resources.”

HeraldLIVE