Crunch time for Councils

REGIONAL Councils will have to become less dependent on State funding this financial year and will be expected to pay their own running costs from now on.

Government has decided to only subsidise councils where approval has been given by the Minister of Local and Regional Government and Housing Joel Kaapanda that their expenses may exceed their projected income and existing savings. This week, the Ministry intends informing Regional Councils whether the budgets they submitted and motivated at special hearings last month have been approved.Permanent Secretary in the Ministry of Local and Regional Government and Housing Erastus Negonga said on Friday that, in the past, Regional Councils had not adequately accounted for funds received from his Ministry.Several councils are guilty of saving and investing millions intended for development projects without ministerial permission.In future, regional councils will no longer be permitted to transfer funds between budgetary votes without prior approval.”The measures are aimed at enhancing financial discipline and exercise stricter financial control,” he said, admitting that in the past there had been no comprehensive financial control over regional councils.Negonga said an investigation into the financial position of the councils had showed a very varied picture – while some were doing commendably well, others lagged behind in financial discipline.The councils of Omaheke, Otjozondjupa, Hardap and Karas, he noted, had over the years persistently failed to recover debts for services (especially water provision) to communities and thus their operational budgets were heavily in the red.He said councils were struggling to pay water and power suppliers because they were not operating on a cost-recovery basis.This situation has, in some instances, led to water cuts especially in communal farming areas.The pressure will now be on for them to improve debt collection to cover their expenses.Negonga said those with large savings, such as the Kavango and Erongo councils, were likely only to receive State funding for development projects.Councils have been directed to open a separate account for funds they will receive for this purpose so that the Ministry can monitor whether the funds are being used for the intended purpose.The Ministry has been allocated more than N$141 million through the national Budget this financial year for subsidies to Regional Councils.This week, the Ministry intends informing Regional Councils whether the budgets they submitted and motivated at special hearings last month have been approved.Permanent Secretary in the Ministry of Local and Regional Government and Housing Erastus Negonga said on Friday that, in the past, Regional Councils had not adequately accounted for funds received from his Ministry.Several councils are guilty of saving and investing millions intended for development projects without ministerial permission.In future, regional councils will no longer be permitted to transfer funds between budgetary votes without prior approval.”The measures are aimed at enhancing financial discipline and exercise stricter financial control,” he said, admitting that in the past there had been no comprehensive financial control over regional councils.Negonga said an investigation into the financial position of the councils had showed a very varied picture – while some were doing commendably well, others lagged behind in financial discipline.The councils of Omaheke, Otjozondjupa, Hardap and Karas, he noted, had over the years persistently failed to recover debts for services (especially water provision) to communities and thus their operational budgets were heavily in the red.He said councils were struggling to pay water and power suppliers because they were not operating on a cost-recovery basis.This situation has, in some instances, led to water cuts especially in communal farming areas.The pressure will now be on for them to improve debt collection to cover their expenses.Negonga said those with large savings, such as the Kavango and Erongo councils, were likely only to receive State funding for development projects.Councils have been directed to open a separate account for funds they will receive for this purpose so that the Ministry can monitor whether the funds are being used for the intended purpose.The Ministry has been allocated more than N$141 million through the national Budget this financial year for subsidies to Regional Councils.