Government intervenes to rescue bankrupt Amathole

The Eastern Cape provincial government (ECPG) has invoked section 139 (5) (a) of the constitution to impose a recovery plan to help the Amathole district municipality meet its financial obligations. Last week the municipality said it would not be able to pay the salaries of 1,670 councillors, traditional leaders and staff for four months from February because of strained financial resources.

ADM executive mayor Khanyile Maneli will be part of a team set up by the Eastern Cape government  to solve the municipality's financial crisis.
ADM executive mayor Khanyile Maneli will be part of a team set up by the Eastern Cape government to solve the municipality's financial crisis. (ECLB)

The Eastern Cape provincial government (ECPG) has invoked section 139 (5) (a) of the constitution to impose a recovery plan to help the Amathole district municipality meet its financial obligations.

Last week the municipality said it would not be able to pay the salaries of 1,670 councillors, traditional leaders and staff for four months from February because of strained financial resources.

In response, a statement was released by the provincial government on Thursday saying they had engaged the national Cogta structures and Treasury departments on the constitutional intervention.

A team made up of the Eastern Cape co-operative governance and traditional affairs MEC Xolile Nqatha, chairperson of the SA Local Government Association in the province councillor Mxolisi Koyo, Amathole municipality’s executive mayor councillor Khanyile Maneli and the Eastern Cape finance MEC Mlungisi Mvoko will monitor and guide the implementation of the financial recovery plan.

“A monthly report of the implementation of this constitutional intervention will be submitted to the ECPG by MEC Nqatha on a regular basis,” the statement read.

Section 139 provides that through the recovery plan a technical team from both national and the provincial government will be sent to support the implementation of a financial recovery plan aimed at securing the municipality’s ability to meet its obligations to provide basic services, or its financial commitments.

Nqatha will provide further details on the financial situation and position of the ADM as well as the progress of the recovery plan.

HeraldLIVE

Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.

Comment icon