Picture: Ayanda Ndamane African News Agency (ANA)
CAPE TOWN – Parliament's Standing Committee on Appropriations has accused the National Treasury of failing to comply with its own regulations relating to clean financial management.

“The forensic investigation report into the Integrated Public Financial Management System highlights the incompetence of officials in the National Treasury,” it said yesterday.

Committee chairperson Yvonne Phosa said: “Officials cannot be on a learning curve at the expense of the public purse, and director-general Dondo Mogajane needs to be more assertive in the approach of consequence management.” The committee cautioned Mogajane against covering up for officials implicated in the forensic report.

The committee further questioned the pace at which remedial action was implemented against officials. Some officials had resigned, but many were still actively employed by the National Treasury.

The integrated financial management system (IFMS) was supposed to be implemented throughout the government more than a decade ago and has become a model for the incubation of new skills in the information, communication and technology sector. Its aim was to replace the numerous disparate, inadequate or outdated systems employed in the public sector.

But there is still no new system in place and, according to one industry insider, considering the more than R4billion of fruitless and wasteful expenditure on this project since 2005, and the changes in information technology, it would probably be better for the government to review the specifications of the entire project.

Instead, last year the Treasury awarded an IFMS tender to the US-based multinational computer corporation, Oracle, for the purchase of software.

Phosa said: “Section 38 of the PFMA requires the accounting officer to put measures in place to prevent unauthorised, wasteful and fruitless expenditure.”

The committee was not happy with the pace at which the Treasury was progressing and instructed officials to craft an acceleration plan that would not only address how it would deal with implicated officials and service providers, but also contain clear timelines of implementation. It also advised the Treasury to look at a recovery plan to recoup the money from service providers and officials.

The forensic investigation report into the IFMS, which was presented to the standing committee yesterday, found various conflicts of interest, tender irregularities and other failures in the process of appointing service providers.

The committee said the Treasury should be a good example for other government departments when it came to internal controls and financial management systems.

Treasury officials did not respond to questions from Business Report on this issue yesterday, but said they would do so today.

BUSINESS REPORT