By Simon Nare
The tourism portfolio committee has instructed South African Tourism to get its house in order following it getting a qualified audit report for the 2023/24 financial year.
Its record keeping and reconciliation control accounts have also been flagged.
After its presentation before the committee in Parliament on Tuesday, MPs raised concerns about the entity’s regression on its financial controls from the previous year.
It was also concerned about SAT’s surplus of R229 million for the financial year.
The committee said in a statement that SAT had since submitted a request to the National Treasury to retain R194 million of the surplus, saying it did not budget for a surplus or a deficit.
It has undertaken to manage its budget better.
“The entity also recorded irregular expenditure amounting to R24.2 million, resulting from failure to follow procurement processes such as inviting competitive bids. The AG (Auditor-General) also identified a material irregularity, which will be included in the auditor’s report for the next financial year,” the statement said.
Committee members demanded to know how the board would ensure proper governance and financial management at SAT after experiencing instability at board and management levels.
The board was dissolved after it was found to have spent millions on meetings alone. A new board was appointed with effect from 8 March 2024.
Tourism Minister Patricia de Lille, who was accounting to the committee, acknowledged SAT’s regression in its audit outcome.
She said steps had been taken to ensure improvements in the new financial year.
The new board chairperson, Dr Gregory Davids, also acknowledged SAT’s governance and performance challenges, saying the board was committed to changing these dynamics.
The committee heard that the AG has provided a clear audit action plan to assist in improving the current situation.
The committee also flagged the vacancy rate at SAT. The percentage of vacancies in the 2023/24 financial year was 16.8%.
Recruitment processes were currently underway, especially for critical posts such as the chief financial officer, head of auditing, chief operating officer and the chief conventions bureau officer.
The committee urged SAT to pay close attention to reasons provided by exiting staff to ensure that these were addressed internally, where applicable, and that the staff turnover rate was reduced.
Committee chairperson Lungi Mnganga-Gcabashe asked for a clear written explanation on the regression and measures put in place to address the audit finding.
“She asked SAT to develop an audit action plan with clear timeframes detailing how the audit outcomes will be addressed and stability maintained. She said progress on this should be reported to the committee every quarter,” the statement said.
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