The Cango Caves in the Western Cape, have narrowly escaped closure as a result of alleged financial mismanagement by the Oudtshoorn Municipality.

Head of Oudtshoorn Tourism, Niel Els, told Tourism Update the Oudtshoorn Municipality last year withdrew R16m (€1.2m) from the Cango Caves Investment Fund. The money, which had been earmarked for the upkeep and maintenance of the caves, was subsequently absorbed into the municipality’s coffers.

The caves are in dire need of upgrades but without money to pay the contractors, all work has been halted. According to Els, the most urgent project is to upgrade the lighting, as the temperature in the caves needs to be carefully controlled to prevent the growth of algae. Some lighting work had already been undertaken but the municipality had failed to pay the contractor an outstanding amount of R1.1m (€81 800), said Els. The contractor has subsequently threatened to remove the already installed lights from the cave.

Els is hopeful the Cango Caves will stay open. “The caves will stay open as long as the lights are on,” he said, adding that they had managed to generate about R500 000 in the past few months as a result of increased ticket sales. “People are pouring in to the caves, wanting to see them before it might be too late.”

Ntobeko Mangqwengqwe, Spokesperson for the Oudtshoorn Municipality, told Tourism Update, however, that the Cango Caves were not in a financial crisis. He said the Oudtshoorn Municipality had contracted a company to upgrade and renew the Caves’ electrical infrastructure for R4m (€297 000) from the Municipal capital budget. He said just over R350 000 (€26 000) was still outstanding and was still in the process of being paid to the supplier.

Mangquengqwe added that the R16m (€1.2m) reallocated to Oudtshoorn had not been done in error but had been taken to repay a long outstanding loan payable to Oudtshoorn by the Cango Caves.

Dr Ivan Meyer, Western Cape MEC for Finance, recently visited the site and referred the matter to the Auditor-General for further investigation. Spokesperson for Meyer, Daniel Johnson, told Tourism Update Treasury officials would try to get to the bottom of reports of alleged financial misconduct and would put steps in place to remedy the situation. “I must also stress that, if these reports of financial mismanagement and even worse corruption are found to be true, the responsible persons will be held accountable.”

The government has established a ‘recovery plan’ to bring back good financial governance at both the municipality and the Cango Caves through strict control over payments and accounts. Said Johnson: “I can assure you that all legitimate invoices related to work carried out at the Cango Caves will be honoured and the Cango Caves will not be closed.”

He said the financial sustainability of the Cango Caves needed to be established and protected. “The present crisis highlights the fragile state of the financial position of the Cango Caves. The financial recovery plan, therefore, needs to take steps towards ensuring that the Cango Caves is eventually able to generate enough income to (a) cover its operational costs and (b) address the costs associated with the preservation of this important heritage asset.”