THE auditor-general Tsakani Maluleke has found irregular expenditure at national and provincial government departments in excess of R166 billion during the 2020/21 financial year.
Maluleke also told a joint sitting of in Parliament that the Development Bank of Southern Africa (DBSA) was the only state-owned entity (SOE) to achieve a clean audit during the same period.
Maluleke addressed a briefing to Parliament’s Standing Committee on Public Accounts (Scopa) and the Standing Committee on the Auditor General on Wednesday.
She said a total of 679 departments and public entities were audited in the 2020/21 cycle but the report focused on the results of 425 audits.
The latest bout of irregular expenditure is an increase from the R109 billion reported in the previous financial year.
“Such expenditure, especially as it relates to procurement, is an indication that auditees do not follow supply chain laws and regulations when making decisions,” said Maluleke.
The report also shows a whooping R1,72 billion was lost to fruitless and wasteful expenditure in the current year, with Maluleke pointing the finger at 224 auditees.
This includes key service delivery departments and state-owned enterprises which accounted for a combined 52% of the wastage.
Health, Education, Housing and Public Works were among the departments flagged in the report.
These departments alone accounted for 90% of all unauthorised expenditure, which sits at a high R3,21 billion.
“Legal claims against government departments, particularly in the health sector, further reduce the limited funds available for intended programmes,” Maluleke added.
“The provincial health departments paid out R1,76 billion for medical negligence claims, while the estimated settlement value of unpaid claims at year-end was R124,15 billion (75% of the total claims against the state).
“Seven provincial health departments had unpaid claims at year-end that exceeded their entire operational budget for the next year.”
Maluleke’s report found that 115 out of the 425 department and entities received a clean audit – 61 of these managed to retain their clean audit status since the first year of the current administration.
“There are 115 auditees (48 departments and 67 public entities) that obtained a clean audit outcome, compared to 109 in the previous year. Together, these auditees are responsible for 19% of the R1,9 trillion expenditure budget managed by national and provincial government.
“At least 31 auditees are close to obtaining a clean audit and require sustained effort to reach this goal,” said Maluleke.
Among the 247 other public entities not characterised as SOEs, only 26%, or 65, got clean audits, while 103 got unqualified audits with findings and 11 got disclaimer audit opinions.
The office of the AG told the joint meeting that financial statements were left outstanding from 17 public entities, which include SAA Group, SA Express and Denel Group.
The office of the AG told MPs that delays from the South African Post Office, the Land Bank and the State Information Technology Agency held up their audits.
- Own Correspondent
