Municipal Budgets

7.1       Municipal budgets:

Immediately after an annual budget is tabled in a municipal council, the accounting officer of the municipality must:

·         In accordance with chapter 4 of the Local Government: Municipal Systems Act –

Ø      make public the annual budget and the documents referred to in section 17(3); and

Ø      invite the local community to submit representations in connection with the budget; and

·         Submit the annual budget –

Ø      in both printed and electronic formats to the National Treasury and the relevant provincial treasury; and

Ø      in either format to any prescribed national or provincial organs of state and to other municipalities by the budget.

In an effort to further accountability and public participation, the Municipal Finance Management Act, 56 of 2003 requires that when the annual budget has been tabled, the municipal council must consider any views of:

·         The local community and

·         The National Treasury, the relevant provincial and any provincial or national organs of state or municipalities which made submissions on the budget.

After consideration all budget submissions, the council must give the mayor an opportunity:

·         To respond to the submissions; and

·         If necessary, to revise the budget and table amendments for consideration by the council.

Without limiting liability in terms of the common law or other legislation, the Municipal Finance Management Act specifically provides for personal accountability and liability over both political office bearers and officials of a municipality that work with financial matters. The Municipal Finance Management Act states that:

·         A political office-bearer of a municipality is liable for unauthorized expenditure if that office-bearer knowingly or after having been advised by the accounting officer of the municipality that the expenditure is likely to result in unauthorized expenditure, instructed an official of the municipality to incur the expenditure;

·         The accounting officer is liable for unauthorized expenditure deliberately or negligently incurred by the accounting officer;

·         Any political office-bearer or official of a municipality who deliberately or negligently committed, made or authorised an irregular expenditure is liable for that expenditure; or

·         Any political office-bearer or official of a municipality who deliberately or negligently made or authorised a fruitless and wasteful expenditure is liable for that expenditure.

A municipality must recover unauthorized, irregular or fruitless and wasteful expenditure from the person liable for that expenditure.

It should be noted that the writing off of any unauthorized, irregular or fruitless and wasteful expenditure as irrecoverable is no excuse in criminal or disciplinary proceedings against a person charged with the commission of an offence or a breach of the Municipal Finance Management Act relating to such unauthorised, irregular or fruitless and wasteful expenditure. The accounting officer is further obligated to report to the South African Police Service.

All contracts that impose a financial obligation on a municipality:

·         Must be made available in their entirety to the municipal council; and

·         May not be withheld from public scrutiny, except as provided for in terms of the Promotion of Access to Information Act 2 of 2000 read together with the MFMA section 33(3)-(4) of the Municipal Finance Management Act.

 Compiled by Prof Dr DJ Lötz (BIur, LLB, LLM, LLD)

Brooklyn Court, Block A, 1st floor, 361 Veale Street, Brooklyn

Borchardt & Hansen Inc