The office of the auditor-general in Cape Town has started legal steps to recover millions of rands in audit fees owed to it by local authorities.
Auditor-General Shauket Fakie told parliament's public accounts committee yesterday he wanted to recover the money before some of the guilty municipalities disappeared in terms of the new municipal demarcation proposals.
Municipalities owe the auditor-general's office a total of R90-million for auditing their books. Some of the debt has been outstanding for years, which created a "serious" cash-flow problem for his office, Fakie said during his presentation of the general report on the accounts of national government.
The Audit Commission, a body appointed by parliament to oversee the auditor-general's office, has now given permission for letters of demand to be sent to local authorities, Fakie said.
"Legal action will be taken against them," he said.
In terms of demarcation proposals ahead of the municipal elections, the number of municipalities will be cut down from 843 to 284. About R16-million is owed to the auditor-general by municipalities that will no longer exist after the elections, raising fears that their debts will disappear with them.
Fakie said a representative of his office was involved in the demarcation process to ensure that legal liability for debts incurred by those municipalities are transferred to the new local authorities.
Financial management in local government was one of the main areas of concern raised by Fakie.
Municipalities were slow to return financial statements for auditing in 1999/2000, with many statements from the previous year still outstanding. The financial position of many municipalities had deteriorated markedly since the last audit, he said.