Government departments, households and businesses owed the financially distressed Endumeni Local Municipality in KwaZulu-Natal over R200 million as of December 2024, when the second quarter of the 2024/2025 financial year ended.

The state of its finances is contained in a report compiled by the Inkatha Freedom Party (IFP) led municipality’s finance department where it was appraising the council.

The municipality, which is battling to pay its creditors, is anchored in the coal mining town of Dundee in the northern part of the province. It is the seat of the Umzinyathi District Municipality and home to several government district offices.

In a breakdown, the department said the total amount the municipality owes creditors including Eskom’s outstanding debt is R213 497 000.00.

The debtors book balance as of 31 December 2024 amounted to R200 223 850.60 with R28 406 352.15 emanating from the government, R38 069 508.70 from businesses and R133 762 588.32 emanating from households.

In the same report it emerged that on October 28 last year, Fidelity Company was robbed R 115 758.88.  Only R 9 300.00 reflected in the municipal bank account as a deposit for that day.

Fidelity, which collects and banks money for the municipality, has since proposed a settlement.

“The service provider (Fidelity) recently shared a proposal amounting to R 50 000.00 in cash as ransom to settle the money that was stolen. The municipality is still engaging the company on the proposed offer to ascertain the basis thereon,” reads the report. 

In the same report, the Endumeni Municipality’s finance department asked the council to rescind a previous decision where R17 million was written off and the Auditor-General (AG)  flagged that, resulting in a negative findings. 

The write off was approved after the municipality switched from UCG financial system to Munsoft and bank books could not be reconciled for three years, between July 2019 to February 2023.

“Amongst the key activities in the governance strategy metrix is the investigation of unreconciled cash and cash equivalents balances dating back from 2019 by Munsoft, meaning. Munsoft Consultants will re-perform the bank reconciliation from prior years.

“The rescission of the Council resolution will enable Budget and Treasury Office to reverse the R17 171 010.50 that was written off and write it back and be investigated by Munsoft Consultants working in collaboration with BTO Officials. 

“The proposed completion date of the bank reconciliation investigation is 6 months ( February 2025 to July 2025). It is upon the above detailed background that the proposal is made before the Council to rescind the R17 171 010.50 write-off resolution,” the department asked the council.

The municipality did not respond when asked about the sudden change of heart regarding the R17 million that was written off.