Take your money out of SA,says econ­o­mist

The Sunday Independent - - POLITICS -

at which ir­reg­u­lar ex­pen­di­ture last year was al­most R14bn.

KwaZulu-Natal, Free State and Lim­popo were among the prov­inces that were the main con­trib­u­tors to the sig­nif­i­cant in­crease in ir­reg­u­lar ex­pen­di­ture.

The sec­tors with the high­est amounts of ir­reg­u­lar ex­pen­di­ture were health at R11.77bn, trans­port at R6.38bn and ed­u­ca­tion at R6.09bn.

In ad­di­tion, the au­di­tor-gen­eral re­ported that 25% of the au­di­tees dis­closed that they had incurred ir­reg­u­lar ex­pen­di­ture but that the full amount was not known, while 28 au­di­tees were qual­i­fied as the amount they had dis­closed was in­com­plete.

Hon­ing in on the re­port, Roodt said that the coun­try had reached a stage At which it could no longer af­ford such out­comes.

“This is the tax­pay­ers’ money that is be­ing mis­spent, which means that the state needs to cut back on its ex­pen­di­ture. This coun­try is in dire straits,” he said.

Roodt pre­dicted that the coun­try would soon be down­graded which would force the econ­omy into re­ces­sion. Ac­cord­ing to his cal­cu­la­tions, the state needed to cut its ex­penses by 6% to 8% next year, “which is highly un­likely”.

“We have ba­si­cally reached the end of the line and push­ing the econ­omy into re­ces­sion would be the only op­tion. You have to be cruel to be kind, but politi­cians don’t think like this.

“The best ad­vice I give to my clients and will tell to your read­ers is take your money out of the coun­try,” Roodt said.

At a na­tional level, there was a slight im­prove­ment in the out­comes with the num­ber of clean au­dits in­creas­ing to 30% of the to­tal pop­u­la­tion.

Provin­cially the Western Cape and Gaut­eng con­tin­ued to pro­duce the best re­sults. “It is also clear that these re­sults are be­ing sus­tained from year to year due to lead­er­ship em­pha­sis­ing a cul­ture of ac­count­abil­ity,” said Mak­wetu.

He also recog­nised im­prove­ments in the au­dit out­comes in both the East­ern Cape and Lim­popo, at­tribut­ing these pos­i­tive trends to the lead­er­ship roles of the pro­vin­cial trea­sury and the pre­mier, re­spec­tively.

In con­trast, the au­di­tor-gen­eral’s out­comes in Mpumalanga, the North­ern Cape and KwaZulu-Natal were “er­ratic” over the past four years.

Mak­wetu re­ported that this was caused by a lack of ur­gency at lead­er­ship in re­spond­ing to the root causes of the au­dit out­comes in those prov­inces.

KwaZulu-Natal pro­vin­cial leader of the DA, Zwakele Mncwango, said he found the re­port “shock­ing”, ad­ding that with the con­stant re­lease of such re­ports, “South Africans seem some­what ac­cept­ing of cor­rup­tion”.

He crit­i­cised the lack of ac­count­abil­ity, say­ing that of­fi­cials were not fol­low­ing proper pro­ce­dures when it came to money “be­cause they know they will be pro­tected by the politi­cians”.

“We need proper lead­er­ship and the will to stop ir­reg­u­lar ex­pen­di­ture,” Mncwango said.

He com­mended the Western Cape and Gaut­eng for pro­duc­ing the best re­sults, say­ing that “the re­al­ity showed that where the ANC does not gov­ern, you can im­prove”.

“One can call it pol­i­tick­ing but it is just the truth,” he said.

While the over­all au­dit out­comes showed a no­tice­able im­prove­ment, Mak­wetu re­ported that progress was ham­pered by fac­tors such as poor com­pli­ance with laws and reg­u­la­tions, es­pe­cially in the ar­eas of sup­ply-chain man­age­ment, in­ap­pro­pri­ate mon­i­tor­ing of key project de­liv­er­ables and an in­abil­ity to man­age the fi­nances of depart­ments and en­ti­ties prop­erly.

He cau­tioned that as long as the po­lit­i­cal lead­er­ship, se­nior man­age­ment and of­fi­cials did not make ac­count­abil­ity for trans­gres­sions a pri­or­ity, ir­reg­u­lar, unau­tho­rised and fruit­less and waste­ful ex­pen­di­ture, as well as fraud and mis­con­duct, would con­tinue.

“An en­vi­ron­ment weak on con­se­quence man­age­ment is prone to cor­rup­tion and fraud, and the coun­try can­not al­low money in­tended to serve the peo­ple to be lost.” he said.

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