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A-G slams procurement systems that led to R17bn in irregularities

Auditor-General Tsakani Maluleke Picture: Thobile Mathonsi/African News Agency (ANA)

Auditor-General Tsakani Maluleke Picture: Thobile Mathonsi/African News Agency (ANA)

Published Feb 12, 2021

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DURBAN – WEAK procurement systems were a major gateway for the rampant financial irregularities in government, auditor-general Tsakani Maluleke said yesterday.

The remarks follow hot on the heels of the A-G’s recent briefing to the KwaZulu-Natal Standing Committee on Public Accounts (Scopa), in which she revealed shocking financial irregularities amounting, collectively, to over R17 billion.

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The Department of Transport (DOT), Economic Development, Tourism and Environmental Affairs (EDTEA) department, the Office of the Premier (OTP) and Sports and Recreation department were among the errant departments.

The A-G said concerns involved fruitless, wasteful and irregular expenditure, among other matters.

“A lack of vigorous supply chain and weak internal controls is often the cause for these irregularities. Internal processes are not vigorous enough to prevent or to detect (crookedness),” Maluleke said during a media briefing yesterday.

Relating to the DOT, contravention of the supply chain management legislation was neither detected, recorded nor appropriately disclosed in the financial statements, Maluleke told Scopa.

In other cases, the A-G has raised concerns about management’s slow response to address audit findings regarding its supply chain management loopholes that were raised the previous year.

She said the reasons for the irregular, fruitless and wasteful expenditure, ranged from “goods being procured without quotations to non-compliance with supply chain management procedures, litigation costs and a salary being paid into an incorrect account”.

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Maluleke’s revelations prompted legislators to call for action to be taken against accounting officials – a statement that has been made in previous years of perpetual financial misconduct.

ANC MPL Sithembiso Mshengu said: “Each and every cent of the public's money must be accounted for.”

The DA’s Francois Rodgers said: “If we want to try and build a capable state, the departments must pass the audits of the A-G and we must have accountability. A lot of what we see happens year after year. Irregular expenditure happens because officials don’t follow the (Public Finance Management Act), which happens for one of two reasons, either you are stupid or you have an agenda.”

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Maluleke said the A-G now had teeth to bite instead of a just a bark, which comes in terms of the new Public Audit Amendment Act.

The amendment enables the A-G to not only share irregularity concerns with lawmakers in parliament and legislature, but to also refer cases to the law enforcement institutions such as the Hawks, Special Investigative Unit, Public Protector or Public Service Commission.

“Before, we could only raise concerns and hope accounting officers in affected government authorities would implement corrective action. Now, we can even stipulate timeframes for corrective action to be taken, failing which we can issue a certificate of debt, and a financial loss would have to be recovered from respective accounting officers,” she said.

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KZN cases had not, as yet, been referred for further investigation.

Provincial government spokesperson Lennox Mabaso said that through the provincial Treasury department, government had a programme in place to improve supply chain systems. For further details, he referred The Mercury to Treasury, who had not responded to questions at the time of publication.

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