By Hon H Motala, IFP MPL, KZN Legislature
Madame Speaker, at the outset the IFP acknowledges that overall improvement in the audit outcomes as compared to previous years. This shows that departments and entities are to a greater extent complying with regulations and this augurs well for the future. It is also encouraging that there has been a decline in the number of auditees with material findings from 88% to 74%. Whilst we acknowledge these improvements, we also note that there is still non-compliance from some auditees with regard to unauthorised, irregular and fruitless expenditure as well as wasteful expenditure. There is also non-compliance with regard to procurement and contract management as well as HR management. These areas are clearly explained in the PFMA and therefore there should be no reason why there is ongoing non-compliance.
SCOPA notes that there is Unauthorised Expenditure to the tune of R143million and also notes that there has been a decrease in this regard. The IFP is nevertheless concerned that this figure is so high and urges departments and entities to comply with regulations in order to reduce this amount even further. The same can be said for Irregular Expenditure which was recorded at R1.6billion. Again there has been a decrease from the previous year but the amount is excessively high and must be brought under control.
We are also concerned about the almost R8million in Fruitless and Wasteful expenditure. Public funds must not be employed in such a wasteful manner when people in our province are crying out for services. It is about time that those responsible for wasteful expenditure are held personally accountable for shortcomings on their part.
Madame Speaker, such negligence and indiscretion is the result of these departments and entities having appointed unqualified, inexperienced and incompetent cadres into highly responsible positions. When accountability and competence is sacrificed at the altar of political expediency, the result will be poor service delivery and maladministration. We cannot and should not allow this situation to continue.
Having said that, Madame Speaker the IFP notes that the Department of Agriculture and Rural Development has not filled funded posts. Whilst we acknowledge that it might be difficult to find suitably qualified people to fill these positions, the Department must make the necessary efforts to fill these posts so that service delivery does not suffer.
SCOPA will await a report from the accounting officer with regard to the continued existence of the AgriBusiness Development Agency and the latest developments around the Mjindi Farming entity in view of the land claims in this area.
Madame Speaker, the IFP is concerned according to Resolution 113/2015 two officials from the Moses Kotane Institute have failed to acknowledge the debt that they owe to the Institute and that the former CFO has been served with papers regarding the payment of debt owing to the Institute. One wonders if this Institute has become a money lending institution and who will pick up the legal expenses in this regard.
Madame Speaker, once again the Department of Education is guilty of Irregular Expenditure. SCOPA has found that this Department has not taken effective steps to prevent irregular expenditure, has not complied with Treasury Regulations and has not complied with supply chain management processes thereby incurring irregular expenditure to the tune of R2.680billion. This is a serious matter as there is SCOPA Resolution 13/2014 that speaks to the same issue and it would appear that this department is continuing to flout PFMA and Treasury Regulations and it must not be allowed to continue.
In addition, according to Resolution 115/2015 this department has failed to pay service providers within the stipulated 30-day time period in terms of contractual obligations.
The IFP is deeply concerned that senior managers in the Department of Education are not ensuring that proper measures are in place to prevent non-compliance with supply chain management processes. This department has the largest budget and therefore one would expect that it would have strict procedures in place in order to ensure compliance, but as can be seen from Resolution 119/2015 this is not the case.
According to Resolution 123/2015, the Department of Health has still not finalised its assets management register. This has been ongoing for the past three years. We want to urge the department to update its Hardcat Asset Management system as soon as possible in order to ensure that the assets of the department are properly recorded and controlled.
It is of serious concern to us that the Auditor General was unable to determine the full extent of irregular expenditure amounting to R2.74billion. Much of this amount can be attributed to weak supply chain management processes and internal controls. Such large amounts with respect to irregular expenditure is unacceptable.
SCOPA resolutions also reflect that managers within the department are involved in contracts for the supply of services. This is highly irregular and needs to be investigated and curtailed with immediate effect.
It is of grave concern to us that medico-legal claims against this department are rising at an alarming rate. Even though Resolution 128/2015 calls on the accounting officer to report on plans to reduce medical litigation, I do not see how this will be possible if health care workers are not held accountable for their actions and if the department does not provide a suitable working environment and adequate support material in terms of medical supplies and proper infrastructure.
Madame Speaker, with regard to the Human Settlements department, it is concerning to note that awards amounting to R66.53million were made to suppliers whose directors or members are in the service of the state as is recorded in Resolution 131/2015. As a government we have been saying for a long time now that we should put an end to officials being given contracts by government, but this practice is ongoing. There is no point in us having legislation in place if we do not have the will to enforce it. It is about time that this government displays its resolve to eradicate this illegal and unethical practice.
Madame Speaker, after all these years it is disconcerting to note that the Department of Transport submits financial statements that were not prepared in accordance with the prescribed financial reporting framework and supported by proper records as required by the PFMA. We cannot continue to tolerate non-compliance with regulations because this shows that officials are blatantly disregarding legislation or that they are not competent with regard to their employment requirements.
It is encouraging to note that the Department of Social Development has brought criminal charges against two of its supply chain managers in order to recover debts owing by them. The IFP encourages other departments to follow suit and hold officials personally accountable and not hesitate to charge those who are found to be using their positions to enrich themselves at the expense of the people of this province.
According to Resolution 140/2015, the Department of Social Development did not take effective steps to prevent unauthorised expenditure relating to, among other things, the “single sourcing of Social Relief from distress service provider/s”. Here again, Madame Speaker we can see that this is done so as to benefit a particular service provider and this has the potential to ensure that personnel involved in procurement enrich themselves. Areas all over our province find themselves experiencing some form of distress be it natural disasters or fires. Therefore there should not be single service provider who is contacted top provide distress supplies. It must become mandatory for local suppliers, closest to the area or population affected that must be contracted to provide services.
Madame Speaker, the IFP is also concerned that the Department of Arts and Culture is also guilty of not complying with PFMA regulations with regard to preventing irregular expenditure to the value of R299.71million as stated in Resolution 145/2015. It is very concerning that the accounting officer approved deviations in contravention of Treasury Regulation 16A6.4, that contracts were entered into in violation of supply chain management procedures, and that contracts were awarded to contractors who were not registered with the CIDB. These are very serious violations of legislation and must not be treated lightly. The accounting officer must be held liable for these violations in order to set an example to others who would want to show scant regard for rules that are in place.
Madame Speaker, from the above it is evident that although there is progress in some aspects of proper accountability, as a government we are still lacking with regard to ensuring that all departments and entities are fully compliant with rules and regulations. It is evident also that some officials are deliberately flouting the rules in order to benefit themselves or their families. If this government is serious about eradicating fraud, corruption and maladministration, then it must demonstrate the will to hold officials personally accountable for their shortcomings.
From the Transversal Resolutions it is clear that fruitless and wasteful expenditure is found in almost every department and this cannot be allowed to continue unchecked.
Transversal Resolutions also indicate that vacant posts that are not filled in good time leads to poor management, weak reporting and a lack of accountability. It is important that critical posts are filled as soon as possible with the most suitable personnel.