Poor leadership the cause of poor financial performance, says Kimi Makwetu


Many of the country's municipalities are often found wanting when it comes to the management of their finances, as well as the management of the disciplines that encourage transparency for there to be accountability to the country's citizens. So said Auditor-General Kimi Makwetu, speaking at Finance Indaba Africa on 12 October 2017. Citing some of the reasons behind the poor financial performance of municipalities, Kimi pegged corruption and a lack of skills as some of the major ones.

"The people who are at the front line, namely the CFO, the municipal managers, the people within the supply chain and procurement departments, do not have the proper respect for the disciplines that they should be enforcing. You find that the people who are supposed to exercise some form of independent oversight are better equipped than the people they report to," said Kimi, adding that it doesn't help to have an internal auditor or auditing committee that is better equipped than the people who are supposed to be doing the actual work.

"It means that you will struggle to fix any issues raised by the auditors, recover money that is unaccounted for, or to make sure that the money goes where it was intended to go. Because the guys in the internal audit function will only tell you where the problem is. They are not there to make sure that the deployment of the requisite controls is sufficiently tackled."

Related to this is the challenge of a constantly revolving door of leadership, with many senior people being in acting positions. This leads to people not being committed to their roles, as they feel their efforts will come to nought as soon as an official appointment is made. This has the same negative impact on existing staff, who do not commit to initiatives of acting leadership for the same reasons.

"You can have a situation where a DG, accounting officer or municipal manager is suspended for a period of three years. He will sit at home receiving a salary, while there is nobody that is appointed to do his job."

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