Too much spent on state leases - report

2012-04-18 08:19

Johannesburg - The National Treasury is concerned that R3bn a year spent on leasing properties for state departments Is too high, according to a report on Wednesday.

Treasury deputy director general for public finance Andrew Donaldson told Parliament's appropriations committee on Tuesday that state spending on leases had grown rapidly, Business Day reported.

"That is a trend we would like to reverse. We would like a situation where we are spending more on investment and maintenance of government accommodation. We want to see this balance improved," he said.

Treasury had set up a team to try to reduce the leasing costs.

The department of public works manages the leases.

Finance Minister Pravin Gordhan and Public Works Minister Thulas Nxesi had agreed "to undertake a joint review of the validity and cost effectiveness of all government property leases", Donaldson reportedly said.

Spending would be even higher than R3bn if leases for provincial departments were included.

The department of public works haS come under fire for its handling of various leases. This included lease deals for new police headquarters in Pretoria and Durban worth R1.6bn.

Following a report by the Public Protector in October last year which found the leases were unlawful and that they amounted to maladministration, President Jacob Zuma suspended national police commissioner Bheki Cele and dismissed public works minister Gwen Mahlangu-Nkabinde.


  • Tony Lapson - 2012-04-18 08:40

    R3 000 000 000.... 300 000 homes at the value of R10 000 each for the people.

      Gordon - 2012-04-18 09:13

      Or R3 million in cash in the pockets of 1000 individuals. Why bother buying a lotto ticket?

      Anthony - 2012-04-18 09:17

      per year x 10 years = 3 000 000 homes = 6 per house hold =18 000 000 housed all in 10 years. and there is not one anc member that can do that calculation. WOW

  • Neels - 2012-04-18 09:17

    To much stolen on state leases

  • Linda - 2012-04-18 10:02

    Leases are one of the best, if not THE best, ways of receiving illegal income! Commercial properties are valued according to the income they produce. The landlord presents a lease with artifically inflated rentals to the bank, who provide a loan based on the rental income - irrespective of how much it cost to build/buy the property. The landlord then rewards the official who signed the lease with the inflated rental with a monthly kick back - which is shown in the landlords books as "broker commission". As just the SAPS leases amounted to R1.6 billion - you can work out how much the corrupt officials are capable of earning in kickbacks!

  • Dennis - 2012-04-18 10:22

    Absolutely disgusting that ANC government officials can get away with this BUT THEN SO DOES THEIR LEADER !!!!!

  • Tony Lapson - 2012-04-18 13:11

    Just waiting for someone to say "stop complaining white people. The ANC has everything under control."

  • braamc - 2012-04-18 17:08

    Fraud and corruption, ANC

  • Deon - 2012-04-18 20:55

    Trace back on the landlords and you will see that someone in government is on the payroll.

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