Tshwane CFO resists sacking

Tshwane’s embattled chief financial officer Umar Banda’s summary motion to ask the Pretoria High Court to overturn his sacking and restore him to his post will be heard on Thursday.

At the center of the dispute is the city’s test result, which is not normally released until January. It looks pretty certain it will qualify, according to one expert, but it’s not yet clear to what extent.

Banda has been accused of failing to ensure that the financial statements submitted to the Court of Auditors were compliant and misleading city officials to believe that they were.

The city has suffered a severe liquidity crisis over the past year, failing to pay Eskom on time every month for its large electricity purchases – despite a strict collection drive that has seen government departments and businesses disconnected from the grid for failing to pay their electricity bills.

Mayor’s Committee member Peter Sutton has said it could take three years to get the city’s finances back on track.

Renewal, Suspension, Termination

In that drama, on November 24, Tshwane Council approved a third extension of Banda’s employment contract until March 31, 2023 – but instead of serving him an amendment to implement the decision, City Manager Johann Mettler served him a notice of suspension on December 1.

This was withdrawn the next day and replaced by a termination without notice. However, the city offered to pay him for the rest of the month.

Banda has headed the city treasury since 2017, his five-year contract ended on June 30.

The Council extended his contract by three months – twice. Each time he was provided with an addendum to his contract to make the renewal effective.

These extensions end on December 31st. The council recently advertised the position and Banda says he plans to apply. In the meantime, the Council has approved the further extension until March 31st.

Only seven days later, Mettler sent him a notice of suspension, according to which he had brought the city into disrepute through his willful or negligent omission of a proper annual financial statement. According to the letter, he committed financial misconduct.

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Banda says in his court filings that the council failed to follow any disciplinary process and did not give him an opportunity to comment before his suspension. He was banned from community property and had to surrender his laptop and access card. The next day, when the suspension was lifted and he was summarily released, no further reasons were given.

He argues that the termination is unlawful because there is no legitimate reason for it, no due process has been followed and the Council was unaware of it and in fact extended his contract until March 31.

He says in his court filings that being fired for financial misconduct will have devastating effects on his career. Municipal employees who are dismissed for financial misconduct will be blacklisted and banned from working in any municipality in South Africa for 10 years.

Ronald Oppelt, chief of labor relations at the city of Tshwane, in an affidavit on behalf of the city, acknowledges that the dismissal was unlawful, but says it makes little difference.

The city would pay him through December 31 when his contract expires anyway.

According to Oppelt, the further extension by the council was merely an authorization – and when Mettler became aware of the non-compliance with the annual financial statements, the city decided not to implement the authorization.

He argues that Banda has no oral or written employment contract beyond December 31 and such an extension would have been unlawful anyway. The council is willing to pay him by that date, but is not demanding that Banda come to the office.

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audit result

Leon Claassen, an analyst at Ratings Afrika, says non-compliant financial statements indicate a qualified audit result.

The qualification level is not yet clear. It can be a direct disqualification or a negative opinion, which is worse.

If the statements are so incomplete that Auditor General Tsakani Maluleke cannot judge, she can even issue a disclaimer.

This article originally appeared on Moneyweb and has been republished with permission. Read the original article here.

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