• The criminal mind

    Ace book reviewer Ian Mann takes a look at what causes someone to commit a white-collar crime.

  • Lessons from Zuma

    It is hard to find silver linings in the ex-president's nine-year storm, says Khulekani Magubane.

  • Love him - but watch him

    Ramaphosa has good intentions but is surrounded by shady characters, says Solly Moeng.


Sanral at risk of downgrades, more bailouts - OUTA

Mar 09 2018 12:24
Lameez Omarjee

Cape Town – The South African National Roads Agency (Sanral) must improve its internal audit processes as its growing impairments will put it at risk of further downgrades and it may require bailouts from the state, the Organisation Undoing Tax Abuse (OUTA) warned on Friday.

The civil rights body was responding to concerns raised over the agency’s financials by the standing committee on public accounts (Scopa) earlier this week.

Sanral has incurred high levels of irregular, fruitless and wasteful expenditure resulting from non-compliance with supply chain management processes, Fin24 reported previously. Scopa also raised the issue that Sanral did not comply with the Public Finance Management Act.

Sanral’s accumulated irregular expenditure amounted to R10bn, and fruitless and wasteful expenditure was over R15m.

“Irregular expenditure is intolerable, regardless of the excuses,” said Rudie Heyneke, OUTA’s portfolio manager for transport.

“Variations from supplier standards should not become the norm and Sanral’s internal audit processes need to be robust to overcome these issues.”

OUTA said it appreciates the fact that Sanral aims to promote transformation by including more small, micro and medium enterprises (SMMEs) in its contracts. However, it is Sanral's responsibility to ensure that these businesses are competent to provide services and it called on the roads agency to do proper vetting in this regard.

"Contracting SMMEs to conduct routine road maintenance projects does not give Sanral licence to deviate from the Public Finance Management Act," said Outa.

Without a thorough audit process Sanral - and ultimately the public - will have to pay, OUTA pointed out.

Impairments to grow

OUTA further expects e-toll fees to drop, and unpaid e-toll fees to increase Sanral’s impairments by another R2bn. This is in addition to the R3.6bn in impairments reflected in its 2017 financial statements, said OUTA.

“This will place Sanral at risk of further downgrades and more bailouts from National Treasury," OUTA warned.

* Sign up to Fin24's top news in your inbox: SUBSCRIBE TO FIN24 NEWSLETTER

Follow Fin24 on Twitter, Facebook, Google+ and Pinterest. 24.com encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

scopa  |  sanral  |  sa economy  |  tolls  |  irregular expenditure


Company Snapshot

We're talking about: #LISTERIOSIS

Minister of Health Aaron Motsoaledi has announced that processed meat was the source of South Africa’s latest and worst listeriosis outbreak on record.

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...

Voting Booth

Would you buy the Blackberry KEYOne?

Previous results · Suggest a vote