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Pretoria - White and blue collar crimes are on the increase, and the loss of taxpayers’ funds has increased from R2.3 billion it to a whopping R10bn over the past two financial years, a discussion on financial misconduct on Thursday heard.
The complete disregard for regulations and the deliberate flouting of procedure were to blame, and the losses were exacerbated by the lack of consequence for transgressors, participants at the Public Service Commission (PSC) discussion heard.
Participants at a round table on financial misconduct meeting agreed that the figure was too high and demanded that strict disciplinary measures be put into place.
Jayce Nair, chief director: governance monitoring and compliance at the National Treasury, said the amount had grown exponentially in recent years, saying the reports that it has reached R10bn were alarming.
“Something has to be done; executive authorities and parliamentary oversight bodies need to tighten regulation,” he said.
Transgressions for misconduct included the failure to pay creditors within 30 days, the failure to report irregularities, fruitless expenditure and processing payments with no verifiable documents.
“An improvement in financial management will improve service delivery, to allow the delivery of the Public Service Management Act,” he said, adding that the Treasury was revising regulations and would be issuing guidelines to improve the understanding of concepts.
Linda le Roux of the Auditor General’s office (Agsa) said the lack of consequences cultivated a culture of misconduct, that prevented the building of an enabling oversight mechanisms, accountability and good governance in the public sector. It destroyed public confidence in public institutions, Le Roux added.
“Strict measures need to be in place, a lack of which prevents fruitful outcomes and kills public confidence. This will continue if we continue to excuse ourselves and our people,” he said.
Le Roux is the Business Executive of the Audit Research and Development Sector of Agsa. She said the problems leading to mismanagement of funds stemmed from vacancies, instability of offices and the failure to conduct basic checks and balances.
She said people were hired when there were no posts, and local governments said they delivered services when they did not: “People do not play their roles,” she said. It is ‘up to us’ to do whatever had to be done, or this culture will never end,” said Le Roux.
PSC chairman Ben Mthembu said mismanagement of public funds was due to a combination of factors. These included weak leadership, generally ignoring procedure and a lack of clarity on what mismanagement was.