Although Francistown City Council (FCC) is grappling with shortage of funds, it has emerged that the city council has since independence been paying back a mysterious loan to government.
This emerged last week when FCC Finance Committee Chairperson and specially elected councilor James Kgalajwe presented the city councils audit report to a full council meeting.
Kgalajwe who was presenting an audit report for the financial year 2009/2010 revealed that the loan which was paid for since independence when councils were established was never accounted for as there is no contract available detailing their agreement with government. He said although the council is paying the loan, they do not have any figures or information on the loan. He said it is up to the city council to come up with a strategy to resolve the issue.
“When government funded local authorities in 1966 for infrastructural developments, it was in the form of loans and the query from the Auditor General is that there is no contract or document that bears the details of the loan between the two. We still do not know how much we owe the government and yet we are paying the loan. Even the government does not have any records of this loan” said Kgalajwe.
On a positive note he said the city council experienced a surplus of P18.1 million for the 2009/2010 financial years as compared to a deficit of P1.2 million in 2008/2009 financial year. He said the total income amounted to slightly over P183 million with an expenditure of over P164.9 million.
He however said that the audit report reflects that there are a lot of inconsistencies in their financial records. “In one instance, the Auditor General complained that there is no formal document or contract that details the supply of fuel and other lubricants by BP Shell over the years to the city council,” he said. Kgalajwe also said that the city council is still battling with efforts to collect millions of pula as money owed to the city council in the form rates and service levy.
“In March this year we made efforts to collect money that is owed to the city council by defaulters in the form of rates and service levy through house to house campaigns but we have not made much progress. I plead with the councilors to speak to their constituents to pay this money,” he said.
In response to the audit report, the councilors expressed their displeasure over the lax attitude by the city council in keeping its financial records.
While adopting the Audit Report, Francistown City Council reached a consensus that it should send a delegation to approach the relevant ministries to enquire about the mysterious loan.