fast little loans
Deon de Lange
SEVERAL cabinet ministers have been given 60 days to report back to Parliament on steps they have taken to sort out the financial and accounting chaos in their departments after irregular, wasteful and fruitless expenditure topped R30 billion last year.
Year after year the auditor-general presents damning findings of poor internal controls and record keeping, supply chain management abuses, internal auditing failures and outright fraud and corruption.
Now the standing committee on public accounts (Scopa) is demanding answers within the next two months, followed by quarterly progress reports.
Scopa chairman Themba Godi (African People’s Convention) tabled several reports in the National Assembly yesterday. These paint a bleak picture of the state of financial management at nine government departments and entities.
“What we see generally in all these departments is that the key causative factor is weak internal controls. These lead to problems the auditor-general has identified, including asset management – which in the case of correctional services has been an issue since 2005.”
Godi said the time had come for these departments and entities to get their houses in order and for “action to be taken against the officials involved”.
“Irregular expenditure” did not necessarily mean money had vanished – only a forensic investigation could determine that – but money had been spent “without following due process”, he said.
In the Department of Public Works, irregular expenditure alone amounted to more than one third of the R30bn total.
Of concern to MPs was that, in many cases, the auditor-general noted the department “did not have adequate systems in place for identifying and recognising all irregular expenditure”. This means that the multibillions in irregular spending identified last year could be just part of an even bigger problem.
For more than a decade Public Works – described by MPs as “dysfunctional” – has been unable to put together an accurate list of properties owned by the government.
This prompted the auditor-general to note in his 2010/11 report that the department “did not provide sufficient and appropriate audit evidence to confirm the completeness, existence, rights, valuation and allocation of properties recorded in the immovable asset register” valued at more than R3bn.
After the department devalued assets to the tune of R6bn last year – in an attempt to correct “misstatements” of the year before – the auditor-general could find “no supporting documents” to verify its claim.
As for fruitless and wasteful expenditure, Godi noted that taxpayers had lost out as government officials had failed to get value for the money – “and for which we always insist that action be taken against the officials involved”.
Again Public Works was one of the biggest culprits, admitting to wasting R6.7m – but again the auditor-general noted that this amount “could not be confirmed”.
Scopa has now recommended that “monies are recovered from employees who [incur] such fruitless and wasteful expenditure”.
Because the department failed to keep proper records, the auditor-general could not verify further spending of R9.4bn.
“The committee recommends that… responsibility for the safeguarding of documents is clearly assigned to individuals and action is taken if documentation is lost,” one of the Scopa reports tabled yesterday suggested.
Leasing – which has already cost one minister her job – is another problem area at Public Works.
Recently-appointed minister Thulas Nxesi has ordered a review of all government leases, and the committee noted and welcomed this in its report.
The committee nonetheless noted that the R12bn in leases claimed by the department last year was in fact understated by a staggering R2.6bn.
Godi appealed to National Assembly Speaker Max Sisulu to “strengthen Parliament’s own monitoring mechanisms” so the legislature could keep a close eye on progress in the coming months.
This was because Scopa had found that “in the past we have realised that even if there are time frames, there is no mechanism to track compliance – especially in terms of timeousness”.
Other MPs were less forgiving.
Pierre Rabie (DA) called for a reform of Scopa itself “because holding office bearers and officials to account is [at present] simply not working”.
“The problem is that some ministers fail to appear before Scopa without any explanation. This is clearly not acceptable. Of further concern is that senior officials rotate [between departments] at an alarming [rate] and consultants are often paid exorbitant fees [to do their work],” he said.
Juli Kilian of Cope congratulated Scopa for “putting the screws” on ministers and their officials, but also complained that the committee was often hamstrung by the absence of ministers and by the fact that the officials responsible simply moved to other departments “when the seat becomes too hot”.
The IFP’s Mario Ambrosini said the reports tabled yesterday “show the measure of the problems confronting the country”.
“The time to be good guys, to condone [and] to accept… is finished. We need to turn the page to change… the way things are done. We plead with the government to be more responsible, more accountable and more reactive to all that which has been exposed in these reports.”