Examining financial management of local government in South Africa: a case study of Alfred Duma Local Municipality in KZN.

Abstract

This study sought to examine the factors affecting financial management in the Alfred Duma Local Municipality (ADLM) in KwaZulu Natal (KZN) Province of South Africa. The study focused on four broad objectives that sought to determine the availability and use of oversight structures for sound financial management, to assess the systems and processes for financial management, to ascertain the level of skills and competencies among municipal officials, and to examine the nature of the relationship between politicians and Municipal administrators with regard to municipal financial management. The study draws on a pragmatic paradigm that was premised on the use of a mixed-methods approach where questionnaire surveys, interviews and documents were used to collect data. The findings of the study revealed that oversight structures that include Municipal Public Accounts Committees (MPAC) and Oversight Committees exist although their role is ineffective in safeguarding municipal finances. The findings further acknowledged the existence of processes such as Integrated Development Panning and participatory budgeting towards sound municipal financial management. However, as reported in the findings. Alfred Duma Municipality still needs to upgrade its skills base in the Finance Department to be able to obtain clean audits. The conclusions drawn for this study are that, to achieve sound financial management, the nature of the relationship between politicians and municipal administrators must be well-managed, and skilled people must be hired towards improving community service delivery. The study, therefore, recommends Alfred Duma Municipality to implement regular financial audits through either internal or external auditing procedures. This should help to detect fraud and corruption at an early stage. This can be realised through regular training and development workshops to capacitate the municipal officials through the acquisition of satisfactory financial expertise that should enhance their competencies in monitoring service delivery.