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Minister of Finance Pravin Gordhan. Picture: Brenton Geach

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As the government gets set to spend more than R1 trillion over the next 12 months – and R4.5 trillion in the coming three years – the National Treasury says it is determined that the money will be spent efficiently and only on the right things.

“Government departments that do not spend, underspend or misspend their allocated funding will be at risk of losing the allocations,” Finance Minister Pravin Gordhan told Parliament on Wednesday.

Sitting alongside Gordhan at the customary pre-speech press conference, Public Works Minister Thulas Nxesi told reporters that all of the more than 3 000 government leases would be scrutinised after the lease scandals that had rocked his department and led to adverse findings by the public protector, auditor-general and Special Investigating Unit.

But, he said, his department lacked the capacity to do this on its own and had called in the National Treasury to help fix the problems.

Nxesi said that, to date, five officials had been suspended and charged with misconduct and that more officials had been implicated. Criminal prosecution would follow, he said.

Gordhan said the Treasury would watch spending “with an eagle eye” and that the government had learned some “very useful lessons” from what could “politely” be termed recent mishaps in the procurement system.

Changes that will come includethe National Treasury monitoring all significant purchases by any level of government, the vetting of procurement officers to ensure they were “clean” themselves and researching a set of reference prices for the main items the government regularly bought.

Gordhan claimed that the majority of civil servants were honest, but that a “significant minority” were engaged in wrongdoing and that “certain businesses” were “key collaborators” in this.

Bribes were paid, he said, and recouped by simply loading invoices with the amount paid. This meant the state ended up paying a premium “of 20 percent, 50 percent and even 100 percent” on goods and services it purchased.

In his speech, Gordhan told Parliament that the Treasury had already issued new regulations requiring departments to submit their annual tender programmes, limit variations to orders and disclose all directives that they issue.

He said a chief procurement officer would be employed to oversee all government procurement.

Referring to the interventions in crisis-ridden provinces such as Limpopo, Gordhan said that cash crises faced by departments had been averted and several “lessons of general application” learned.

These included the need for rules to ensure that legitimate creditors were paid within the prescribed 30-day period, that no staff were appointed where there was no budget for them, and that the oversight of provincial financial management and supply chain processes needed to be strengthened, he said.