IFP EXPOSES FRAUD IN DEPARTMENT OF HOUSING

June 6, 2006

The IFP acts on the findings of the Auditor General who uncovered massive fraud in the Department of Housing. The fraud concerns housing subsidies in the 2004/2005 financial year.

Of the 314 audited instances of applications for a housing subsidy, 239 applicants declared that they and their spouses were unemployed when, in fact according to PERSAL, they or their spouses were employed by the state and received a joint income of more than the threshold amount of R42 000 per annum at the date of declaration. The subsidies awarded on this basis, amounted to R3 417 230.

Likewise, of the 314 instances audited, in 49 cases applicants declared on their application forms that both they and their spouses were unemployed.
However, according to PERSAL at the date of declaration they or their spouses were employed by the state and were earning less than the threshold of R42 000 per annum. The subsidies awarded on this basis, amounted to R515 159.

"This is a disgraceful instance of ministerial hypocrisy. Let us not forget for a moment that the big crusader for transparency in local government, the MEC for Local Government and Traditional Affairs, is the very same MEC also responsible for housing," said Dr Lionel Mtshali MPP, who leads the IFP in the KwaZulu-Natal Provincial Parliament and also represents the party on the Standing Committee on Public Accounts (SCOPA).

The witness to fraud in the system is traceable to Level 1, that is municipalities where connivance with fraudulent beneficiaries occurs, and Level 2, that is the Department where appropriate controls are not in place.

Contact:
Dr Lionel Mtshali, 083 256 4902