Western Cape municipalities secure 20 clean audits — with troublesome ones still lagging behind

Twenty. That’s how many Western Cape municipalities receive clean audits in the Western Cape, making it the top province to receive such an outcome. The City of Cape Town can brag too — it’s the only metro municipality in South Africa (SA) that received a clean audit. 

In her 164 page  report on local government audit outcomes for the 2022/23 financial year, Auditor General Tsakani Maluleke reported  20 of the  34 municipalities that received clean audits ,  are found in the Western Cape.

Read more: Municipal audit results continue to decline — irregular, wasteful expenditure balloons to R7.4bn

In total, the Western Cape has 24 local municipalities, five district municipalities and one metro. This makes 30 municipalities in total. 

Although the 20 clean audits were a slight decrease from the previous year’s 21, the AG said this “slight regression” underscored previous messages to municipal leadership to intensify controls around compliance. The AG’s report said this area was mainly responsible for six municipalities not being able to achieve clean audits.

Read more: Cape Town and Prince Albert pave the way with clean audits but problems persist in Beaufort West, Laingsburg and Kannaland

The  AG’s report highlighted the following positive findings about the Western Cape municipalities: 

• Stable leadership in Bitou and Oudtshoorn 

The two Garden Route municipalities were highlighted for achieving clean audits. “We commend Bitou and Oudtshoorn local municipalities that improved to clean audits due to stable leadership and the implementation and monitoring of credible audit action plans, respectively.”

During the audit period, both parties — hung councils after the 2021 municipal elections — were led by Democratic Alliance-led coalitions. But in the last few weeks, both these councils experienced changes. Oudtshoorn is now leading an unlikely coalition of the African National Congress (ANC) and the Freedom Front Plus (FF Plus), along with regional parties. Bitou’s council changed from a DA-led one in February, but has returned in recent weeks to that of a DA-led coalition.

Read more: Garden Route council coalitions in flux as politicians cast an eye to 2026

• Huge praise for Breede Valley 

Praise was given to Breede Valley municipality. According to the report, the DA-led municipality did not incur any unauthorised, irregular, or fruitless and wasteful expenditure — the only municipality to achieve this. “We encourage this municipality to take the lead in the province and share with other municipalities its best practices.”

• Regression from clean audits

The outcomes of Knysna, Prince Albert, Swellendam and Theewaterskloof local municipalities regressed. According to the AG, “at Knysna and Theewaterskloof, vacancies of the chief financial officer position and within the finance unit led to a breakdown in daily disciplines. As a result, Knysna received a qualified audit opinion, and Theewaterskloof regressed from a clean audit to an unqualified audit opinion with findings”.

In Theewaterskloof, that hung council was governed by a coalition of the ANC, Patriotic Alliance (PA) and Good party for the duration of the audit period. Recently, it was taken over by a coalition of the DA, Good, and Socialist Revolutionary Workers Party.

Daily Maverick has consistently reported on the coalition in Knysna (comprising the ANC, PA, and regional party the Plaaslike Besorgde Inwoners), making the news for its coalition and service delivery problems, and now, provincial government intervention.

Read more: DA calls for Knysna council to be dissolved and new elections to be held

• Swellendam’s protests affects its audit

In Swellendam — about two hours from Cape Town — the AG was unable to audit all the material service delivery performance indicators after some of the municipality’s records were lost after the municipality building was set on fire. According to the AG, the protests in August 2023 and the subsequent setting alight of the municipal building which housed the finance department’s records, impacted the audit. Swellendam — situated in the Overberg, and run by a DA-FF Plus coalition — dropped from a clean audit to a financially unqualified with findings audit opinion.

In December, Daily Maverick reported that the provincial audit team had written to the Western Cape legislature to inform him of the delays in the audit process for the municipality.

• Trouble in Laingsburg 

“Laingsburg Local Municipality received an adverse opinion, despite paying R4,06-million to consultants to assist with preparing its financial statements,” read the report. Laingsburg is close to Beaufort West.

In the previous year, the municipality — run by an alliance of the ANC, PA and Karoo Democratic Force — also received an adverse opinion from the AG.

The report said the municipality “has a long-serving chief financial officer, but the combination of a high vacancy rate and lack of skills within the finance unit, an ineffective internal audit unit, and a non-functional audit committee for half the year, resulted in poor record-keeping and inadequate reviews of the financial statements persisting”.

The “resulting lack of credible financial statements prevents users from relying on them and affects decision-making on the municipality’s operations and service delivery performance, which ultimately has an impact on its residents”.

Kannaland Mayor Jeffrey Donson in Ladismith in February 2024. (Photo: Shelley Christians.)

• Kannaland and Beaufort West, again 

Kannaland — the municipality known for its controversial mayor Jeffrey Donson, its trouble in financial governance and debts to the AG and Eskom — had an outstanding audit opinion in this reporting period. Daily Maverick reported in December 2023, Kannaland only submitted its financial statements on 2 October — almost two months later than the required auditing deadline of 31 August.

In Beaufort West, the AG reported its concerns about the Karoo municipality “as it was again qualified in 2022-23, despite having a financial recovery plan in place”. However, the municipality — run by an ANC-PA-KDF coalition — did manage to “reduce the number of material misstatements reported by implementing a credible action plan to address the previously reported root causes of the misstatements”.

The Western Cape, in conclusion

The AG’s report closed with a plea that “we urge municipalities to continue to lead by example, and to embed a culture of compliance and adherence to ensure that consequences for accountability failures are implemented swiftly, especially at the poorly performing municipalities”. 

It said the provincial local government department must devise coordination strategies to address instability in councils, ensure critical positions such as those of the chief financial officer are filled promptly, and explore options within the law to become more involved in addressing the political instability at poorly performing municipalities.

In addition, “municipal councils and mayors should enhance performance planning and budget monitoring to ensure that the needs of citizens are properly considered and planned for, and that resources are fully and optimally used to enable the achievement of service delivery targets”. DM