Bailout for KZN education
FINANCIAL Official calls for department to be placed under administration as financial mismanagement leaves children hungry
The KwaZulu-Natal education department has lost control of its finances, leaving children without food and district officials unable to properly monitor schools. An expenditure report for the first six months of the 2015/16 financial year, which ended in September – a copy of which City Press has obtained – reveals that the National Treasury and provincial treasury had to give the department a R908 million bailout. The report shows that much of that money was spent on salaries and administration.
The report also shows that not much has changed since the 2014/15 financial year, for which the department’s annual report revealed that officials used R860 million meant for infrastructure to pay salaries and for administration. The provincial treasury in Pietermaritzburg then dipped into its contingency fund, using R355 million to pay for infrastructure such as school buildings.
The result of this, said a senior executive at the department in Pietermaritzburg, who spoke on condition of anonymity, is that over the past two years, the school nutrition programme had been so erratic that pupils in some institutions in the Ilembe and Pietermaritzburg regions had to go without food for up to five months.
“They have also capped the number of kilometres we can travel per month to 1 750km. But this does not work; this is a wide province,” he said.
“Some managers travel 800km in one trip to come to meetings at head office or to visit schools. And they have to make four trips a month. This is one of the reasons our matric results are declining. We are in serious financial distress.”
KwaZulu-Natal’s matric pass rate declined from 69.7% in 2014 to 60.7% last year.
Two senior officials in the education department told City Press yesterday that KwaZulu-Natal was spending more than 90% of its budget on salaries.
“The Public Finance Management Act allows departments to use 80% of their budgets for salaries and administration, and the remaining 20% for infrastructure and goods and services,” one said.
“You can push it to an 85%-15% split, but what has been happening is that they are far beyond that. At some point, they used more than 90% of their budget to pay for salaries. They are now forced to delay other things and the problem keeps compounding.”
The official said the department should be placed under administration.
“It was nearly placed under administration following the same move in Limpopo in 2011 and in the Eastern Cape in 2012. I don’t know what happened. Anyway, it should be under administration.”
The official and another former senior executive at the basic education department in Pretoria said when KwaZulu-Natal Education MEC Peggy Nkonyeni was appointed in 2014, she appointed an auditing firm to look into the province’s spending patterns, bloated organogram, infrastructure and personnel.
Three sources inside the department told City Press that the province had hired too many staff members, which was what most of the money was being spent on. Two laid the blame at the door of powerful teachers’ union Sadtu for forcing the department to create positions for which there was no budget.
A former national education executive said the province “created posts without permission”.
“It is bad financial management and bad planning. They were put under pressure by Sadtu to create positions that were not funded.”
Sadtu provincial secretary Nomarashiya Caluza said the union did not put pressure on department head Nkosinathi Sishi to appoint people to positions that had not been budgeted for.
“We put pressure on him to fill vacant positions. As it is, there are many vacant posts for subject advisers. Education specialist positions were recently filled after being vacant for many years. We put pressure on him to appoint people to vacant positions because we don’t want our members to be overworked.”
The former executive said the KwaZulu-Natal department “stops spending at the end of the third quarter of every financial year, and waits for the new financial year”.
“When their money comes in, they start by paying the previous three months’ debt. Normally, when a province is like that, it ought to be placed under administration.”
A preliminary report by Professor John Volmink into the jobs-for-cash scandal, which was exposed by City Press, revealed that KwaZulu-Natal was one of six provincial education departments that had been “captured” by Sadtu.
KwaZulu-Natal education spokesperson Muzi Mahlambi said the R860 million bailout received in 2014/15 was used for salaries because shortfalls had been created by salary increases following collective agreements. He said he was not aware of the R908 million figure, but added that whatever they did with the money, it would be in accordance with agreements reached with Treasury. He denied that the department was broke.
“You are only broke if you borrow, but when you reprioritise your own funds, its means that you do have [money],” he said, adding that continuously asking Treasury for bailouts was not desirable.