E51.1m for Hlatikhulu factory shell not utilised
MBABANE – The Auditor General (AG), Timothy Matsebula, has noted that there was non-utilisation of the funds (budget) released for Project M34670- Construction of Factory Shells (Hlatikhulu), amounting to E51 184 000 in the fiscal year ended March 31, 2023.
According to the AG’s financial audit report for the year ended March 31, 2023 was not in the Estimates %ook for the years April 1, 2022 to March 31, 2023.
In the report, Matsebula stated to have warned the controlling officer in the Ministry of &ommerce, Industry and Trade that the non-utilisation of the budget provision indicated that there were delays in the implementation of the project and there was a possibility of project costs escalation due to price increase.
Matsebula said the public funds were tied up in the above-mentioned project, and they were neither used for the intended purposes nor anything else in the entire fiscal year. Hence, it was not conducive to the development of the country and should not be regarded as savings. He said the non-utilisation of released project funds implied that the budgeted project was not a necessary initiative worthy of implementation; its objectives were not achieved hence efficiency and effectiveness of service delivery was hampered. He said it could also be a result of inadequate budgeting and execution. More to that, other government programs and planned development initiatives may have been unnecessarily deprived of the locked-up finances because had the funds been accessible and/or used to finance those essential programmes, they would have contributed towards achievement of government’s goals, development and economic growth of the country.
“I advised the controlling officer to ensure that released funds are utilised and not seek budget release when not ready to implement any activity or programme,” said Matsebula.
Hence, the ministry was advised to explain the reasons that made it to have no expenditure on this project.
According to Matsebula, the controlling officer acknowledged my observation and submitted that:
The ministry requested for a budget allocation for the Reconstruction Fund, however, when the ministry initiated the budget request the Reconstruction Fund regulations of 2021 were not in place.
Release
When the regulations were promulgated, it transpired that they were not clear on how the disbursement of the fund would be executed in a public capital project. Hence, when the ministry was requesting for funds, accessibility was not possible. The government’s central agencies attempted to rescue the situation, but their attempts were futile thus, a correspondence was issued to the Ministry of Finance.
(ii) The intervention requested to be undertaken by the Ministry of Finance did not materialise until the financial year 2022/23.
(iii) In the Financial year 2023/24, the central agencies provided for the budget that was supposed to be undertaken through the Reconstruction Fund under the Taiwan Donor Funding. The budget was provided under the local funds – item 099.
The AG said the response of the controlling officer was noted; however, the controlling officer did not state the rationale behind requesting a budget for the Reconstruction Fund without the necessary regulations having been enacted. Estate Trading Account – 70210. He said this was in contravention of Financial and Accounting Instruction 0501, which states that”the accounting officers must ensure that revenue due is collected promptly and that all collections of revenue are properly brought to account.”