Leadership Vacuum, Local Authorities Grapple with Financial Mismanagement

Senior Reporter

A recent report by the Auditor General of Zimbabwe has exposed widespread financial mismanagement and lack of accountability at local authorities, echoing the concerns raised by the Parliamentary Portfolio Committee led by Charlton Hwende. The report highlights a plethora of challenges, including inconsistent decision-making and policy implementation, which have ultimately compromised the financial integrity and reputation of local authorities.

The Auditor General’s report reveals that many local authorities lack effective financial management systems, leading to inadequate budgeting, poor revenue collection, and inefficient expenditure management. This lack of transparency and accountability has resulted in the misappropriation of funds, with some local authorities failing to account for significant amounts of money.

The report also notes that the lack of stability in leadership at local authorities has contributed to the financial mismanagement, with many councils lacking permanent accounting officers and finance directors. This lack of leadership has resulted in inconsistent decision-making and policy implementation, further exacerbating the financial challenges faced by local authorities.

The Auditor General’s report has called for urgent action to address the financial mismanagement and lack of accountability at local authorities. The report recommends that local authorities prioritize the development of effective financial management systems, ensure transparency and accountability in financial decision-making, and strengthen leadership and governance structure

One of the primary concerns raised in the report is the absence of permanent accounting officers and finance directors at local authorities. This lack of stability in leadership has resulted in inconsistent decision-making and policy implementation, making it challenging for local authorities to prepare financial statements and operate effectively.

The report also notes that staff shortages and high labor turnover in the accounts department have contributed significantly to delays in preparing financial accounts. This, in turn, has resulted in local authorities missing statutory deadlines, further exacerbating the challenges faced by these institutions.

Furthermore, the report highlights the issue of outdated accounting systems used by some local authorities. For instance, Gweru City Council’s acting town clerk revealed that the local authority uses Programme Municipality (PROMUN), a government contract that was given to the local authorities, as its accounting system. However, this system is inadequate for the council’s needs, relying on manual processes for bank reconciliation statements that are time-consuming and prone to errors.

The use of outdated accounting systems is not only inefficient but also undermines the financial integrity and reputation of local authorities. The report emphasizes the need for local authorities to invest in tried-and-tested accounting systems that match their demands. This would enhance efficiency and accuracy in financial management and improve the timeliness of financial reporting.

The committee’s report also raises concerns about the failure of some local authorities to appoint auditors in a timely manner. For example, Gweru City Council experienced delays in appointing auditors due to external auditors’ failure to enter into a contract with the Auditor-General. This lack of oversight and accountability has resulted in a lack of transparency and trust in the financial management of local authorities.

To address these challenges, the committee has made several recommendations. Firstly, the Ministry of Local Government and Public Works must ensure that local authorities comply with the provisions of the PFMA Act. Secondly, local authorities must invest in modern accounting systems that match their demands. Finally, the committee has urged the Ministry of Local Government and Public Works to ensure that budgets are not approved for local authorities that fail to submit financial statements to the Auditor-General.

Charlton Hwende, the Parliamentary Portfolio Committee chairperson, has reiterated the need for urgent action to address the financial mismanagement and lack of accountability at local authorities. His sentiments, echoed nine months after the report, emphasize the importance of addressing these challenges to restore transparency, trust, and accountability in the financial management of local authorities.

As the government and local authorities work to address these challenges, it is essential to recognize the importance of transparency, accountability, and good governance in the management of public finances. By addressing these challenges, Zimbabwe can work towards creating a more efficient, effective, and accountable system of local government that truly serves the needs of its citizens.