WC legislature calls for administrators to rescue indebted Kannaland Municipality

The municipality owes R12,7 million to Eskom and has another week before its lights are switched off.

Minister of Coorperative Governance and Traditional Affairs Des van Rooyen. Picture: GCIS.

CAPE TOWN - The Western Cape Legislature committee on Local Government wants the Kannaland Municipality to be placed under administration due to financial problems and maladministration.

The provincial legislature's standing committee on local government has today briefed the media on its planned intervention in the indebted municipality.

The municipality owes R12,7 million to Eskom and has another week before its lights are switched off.

The provincial legislature's standing committee has requested a meeting with Cooperative Governance and Traditional Affairs Minister, Des van Rooyen and Finance Minister Pravin Gordhan to send administrators to Kannaland.

Committee Chair Masizole Mnqasela says municipal officials told them they would be taking out a loan to repay the debt - this is in violation of the Municipal Finance Management Act.

"We have engaged the municipality, and in fact warn them on their attempt to pay the R12,7 million debt using a Standard Bank loan of R7,3 million that will have accumulated interest."

Mnqasela says this proposal was rejected by the legislature as well as provincial and National Treasury.