MPs on the standing committee on public accounts (Scopa), the fiscal watchdog of Parliament, were effusive in their praise of Finance Minister Pravin Gordhan and his Treasury lieutenants yesterday, but the minister expressed concern about a culture of impunity which was developing in government departments.
MPs discussed the auditor-general’s report on the Treasury – which did not present many problems over which MPs could nitpick – but the minister made the comment that he was concerned about departmental procurement across the government.
He said that there could be a flood of good regulations governing departmental fiscal decision-making and oversight, but if there was no “culture” of obeying these regulations, things could go wrong.
DA member on the committee Dion George said he was not sure whether Gordhan had “Nkandlagate” – the alleged irregular spending of R250 million by the Department of Public Works on President Jacob Zuma’s rural palace in KwaZulu-Natal – in mind, “but he certainly didn’t mention it”.
Gordhan, noting Treasury’s efforts to set up a national procurement administration to centralise the procurement function in the Finance Department, said: “We are reaching a point where many entities in government… people are operating with impunity.” He suggested that public servants knew that they would not be stopped or get caught out.
George had earlier expressed the view that there were three “key” elements of a good audit. “You need to have good financial management procedures in place, then the internal audit demand must be effective. That would then feed into the audit committee who would be alerted to problems way before the audit process starts… That would be the idea if the procedures worked properly,” George said.
Committee chairperson Themba Godi praised the Treasury team, however. “Treasury has been exemplary. They show how things should be done and how things are done.”
He specially heaped praise on Lungisa Fuzile, the Treasury director-general, for “an added toughness [in] seeking to ensure that officials [in his department] do the right things… which is correct.” He noted that if Treasury had to be a model for other departments, it was essential that it demonstrated this “right where we are”.
MPs did question a reference to irregular spending of R3.9m in the last financial year on a building in Pretoria occupied by the Treasury.
George said the Treasury had received criticism from the auditor-general in the previous audit for 2010/11 for special pensions irregularities. “The director-general didn’t quite agree with the auditor-general at the time,” noted George, saying it was important that the Treasury director-general had a good relationship with the auditor-general and the department’s audit committee.
The director-general said: “We have developed a plan which we shared [with the auditor-general].” However, he said: “I sometimes get disappointed with how things get said [reported]… all this hard work is reduced to a paragraph. To the people who have done it and as a manager who has to motivate the people, it can be disheartening.”
Godi stopped Fuzile saying “the terrain you are getting into… let’s stay out of it”. There would always be contestation between the auditor-general and a department, but in this case it did not signify anything “substantive” Godi said.
George said afterwards he was concerned about the breakdown in Scopa’s effectiveness. “We are still leaking about R30 billion a year through wasteful and irregular expenditure. It means Scopa is not doing its job.”