The long-standing disciplinary matter of suspended Nelson Mandela Bay city manager Noxolo Nqwazi is likely to cost the city millions of rands more.
Chief financial officer Jackson Ngcelwane said the absence of a permanent city manager was a key factor in the loss of the R241m rollover from the 2024/2025 financial year, warning that future applications would continue to be rejected unless the post was filled.
Ngcelwane said a total of R1.6bn was lost in rollover applications in recent times.
“We’ve lost R1.6bn over the years. That money could’ve been part of the reserves. What was the reason? A failure to have a municipal manager. If that continues until March, we’ll lose the rollover again. There’s no rollover that the National Treasury will approve without a city manager. Whatever money we’ve not spent, we’ll lose,” Ngcelwane said.
He was speaking at a budget and treasury committee meeting on Tuesday. Ngcelwane was responding to questions from DA councillor Brendon Pegram on why the metro’s reserves were dwindling. The meeting was held at the South End Fire Station.
Councillors spent much of the meeting fanning themselves after the air-conditioning at the Joint Operations Command (JOC) failed, leaving a single open window for ventilation.
I know we’re only six months into the financial year, but it is concerning that the municipality can only sustain itself for 59 days. It cannot be that we’re measuring our cost coverage in days. We need to be at least four months and over, and not 1.7 months
— Brendon Pegram, DA councillor
Before the proceedings even began, budget and treasury political head Khanya Ngqisha announced that the projector and microphones were also out of action, grounding all PowerPoint presentations and forcing councillors to rely on their voices to be heard.
During the meeting, Pegram noted the low capital spending, which stood at just 27.02% by December 31.
“We aren’t doing anything different to avoid a qualified audit for this financial year. We need to start working on strategies to improve our capital spending. Why are our cash reserves dwindling?
“I also want to know, do we run the risk of cash flow problems in the next year or two with this trajectory we’re seeing? We need to put measures in place. What’s going on there?” he said.
Pegram said he was concerned about the cost coverage, meaning how long the municipality could keep covering its running costs before money ran out.
“I know we’re only six months into the financial year, but it is concerning that the municipality can only sustain itself for 59 days. It cannot be that we’re measuring our cost coverage in days. We need to be at least four months and over, and not 1.7 months.
DA councillor Werner Senekal questioned whether a budget steering committee was in place to monitor capital expenditure. He then gave comments on the 2025/2026 mid-year report.
On electricity losses, Senekal said he was concerned about the R840.5m lost in five months.
We see this annually. Has the mayor not been kept abreast that the electricity department is running at a loss of R1.3bn, and now we’re already at R840m in five months?
— Werner Senekal, DA councillor
“The mayor seems to have misled residents in the TV broadcast that R1.3bn electricity losses were over a period of eight years. Is the mayor not aware of these reports that are coming to this committee.
“We see this annually. Has the mayor not been kept abreast that the electricity department is running at a loss of R1.3bn, and now we’re already at R840m in five months?”
ANC councillor Luzuko Peter said he had noted the low capital expenditure.
“We’ve been discussing this for the entire four years [in council]. We’ve been proposing solutions in this standing committee. The solutions we gave have not yielded any positive results. I want to check with you, CFO, just advise us, what can be done to improve capital spending and what can be done to prevent low expenditure on capital spending.”
Peter also criticised the city’s repeated failure to pay creditors within the legislated 30 days.
During the meeting, Senekal questioned a three-year R36m contract for the supply and delivery of toilet paper.
Senekal asked how much each roll of toilet paper costs, adding that there could be cheaper toilet paper.
No answer was given.
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