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R25bn down the drain

Mar 17 2013 10:38 Xolani Mbanjwa and Sabelo Ndlangisa, City Press
Terence Nombembe

Only 117 of the 536 government institutions evaluated across South Africa achieved clean audits in 2011/12, Auditor General Terence Nombembe said. (Picture: Sapa)

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Johannesburg - R24.8bn – to be exact. That’s the bill for unauthorised, irregular, fruitless and wasteful spending by provincial departments and entities.

That’s what Auditor General (AG) Terence Nombembe and his team found during their 2011/12 audit – and it’s almost R4bn more than the previous review.

Shockingly, Nombembe and his team audited 29 fewer departments and entities, but the bill for provincial misspending still soared.

And, the AG has warned, this misuse of public funds has “become the norm”.

Nombembe blamed lax internal controls, weak political leadership and a disregard for procurement rules as major contributors to the massive bill.

The biggest provincial offenders were the North West government, with R4.165bn; KwaZulu-Natal, which incurred R3 993bn; and Free State, with R3 255bn.

The SA Institute of Race Relations calculated what could have been paid for by the state with the wasted R24.8bn.

They found that during the audited period:

  • Child-support grants could have been paid for 7.4 million children – 70% of those currently being paid out;
  • More than 400 schools could have been built;
  • At least 550 new prisons could have been built;
  • The country’s total water and sanitation infrastructure for one year could have been covered; and
  • The president’s salary could be paid for 9 000 years.

The City Press graphic below outlines what government could have done:

Spending

Earlier this week, Nombembe published his team’s grim findings on the state of government’s financial administration in the consolidated general report on national and provincial audit outcomes.

But he was not surprised by the high figure.

He said: “That, I suppose, continues because of the lack of consequences. If people continue to think they have done it before and nothing has happened to them, I guess the temptation is to continue to do it because nothing is done about it anyway.

“No lesson really seems to have been sent very clearly of what will happen if people transgress the rules.”

Nombembe and his team audited fewer departments and entities this time around because they did not include those that missed the deadline of September 30 to take part.

Public Service and Administration Minister Lindiwe Sisulu and her performance monitoring and evaluation counterpart, Collins Chabane, were in Pretoria for the release of Nombembe’s report.

They listened attentively as he revealed the details.

The report on Free State found wastage in nearly 70% of its government institutions and departments.

Nombembe singled out the province’s accounting officers and department heads as not doing enough to prevent wastage.

"The extent of this expenditure and noncompliance by the accounting officers is indicative of an environment where incurring unauthorised and irregular expenditure has become the norm, and not the exception,” said Nombembe.

This year’s appalling results – clean audits for fewer than a quarter of 536 audited state entities, and for only three of 38 national departments – mean the lofty goals set in 2009 with the launch of Operation Clean Audit 2014 are nothing more than a pipe dream.

 - City Press

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