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Johannesburg - A whopping R1.5 billion! This is how much tenderpreneurs unlawfully pocketed through the continued violation of treasury regulations in the awarding of tenders and contracts by Limpopo municipalities.
Auditor-General Terence Nombembe’s latest report reveals the shocking increase in irregular expenditure for the financial year that ended in June 2012. The report, released on Tuesday, reflects the paralysis of governance in almost all municipalities in the province.
“During the 2007-08 financial year, the province experienced its highest level of qualified/adverse/disclaimer audit opinions (86 percent), only to be exceeded three years later in the 2011-12 financial year (93 percent),” said Nombembe.
Irregular expenditure has reached the billion-rand mark, from the R715 million recorded in the previous financial year.
Nombembe indicated that awards amounting to R363m for the latest financial year have not been audited; therefore this amount has been separated from the billion-rand figure.
Leading culprits in the flouting of supply chain management laws are Sekhukhune, Polokwane, Vhembe, Mopani, Elias Motsoaledi and Ephraim Mogale municipalities.
Unauthorised expenditure went up from last year’s R586m to R733m this year.
Unauthorised expenditure occurs when budgeted allocations are exceeded or used for unintended purposes, according to Nombembe.
However, fruitless and wasteful expenditure, which represents either penalties or interests on late payments and the payments for services and goods that were not utilised, has gone down slightly.
The amount has been reduced by R10m from last year’s R42m.
Nombembe said this money was spent in vain, and this could have been avoided had reasonable care been taken.
Of the 30 municipalities, only one received a clean audit opinion.
Molemole municipality has failed to submit its financial statement to Nombembe for audit.
“Only the Waterberg District Municipality managed to sustain its clean audit opinion for two consecutive years.
“This is due to the continued effort by the chief financial officer and the municipal manager in monitoring action plans and the diligent implementation of key controls,” said Nombembe.
Fetakgomo Local Municipality, which received a clean audit opinion for the past two consecutive years, regressed to unqualified audit opinion with findings.
“A total of nine auditees regressed,” said Nombembe.
He said Limpopo had moved further away from the target of a clean audit by 2014.