Several Bhisho departments projected to overspend by hundreds of millions

Some Eastern Cape government departments appear to have ignored the provincial treasury’s call to spend their allocated budget effectively and according to plan, and are projected to overspend by hundreds of millions of rand.

The health, education, transport and human settlements departments are set to overshoot their budgets by the biggest amount in the 2022/2023 financial year, adding to pressure on the overstretched provincial fiscus.

Of the total provincial budget of R87.6bn for the year, the departments of education and health got the biggest slice — R38.6bn and R27.4bn.

The two departments are the biggest culprits when it comes to projected overspending.

Finance MEC Mlungisi Mvoko said the health department was projected to overspend by R330.4m.

This was “mainly due to writs payments for medicolegal claims which were due for payment after the court dismissed instalment payments”.

“The medicolegal [claims] were not fully budgeted for in the current year,” Mvoko said.

He said the appointment of 642 professional nurses and eight health promoters by the department had also affected its financial plans.

“As a result, the department revised its district grant business plan to accommodate the need to appoint these 642 professional nurses and eight health promoters.

“The overspending will be corrected during adjustment estimates,” Mvoko said.

The MEC said the education department was projected to overspend by R191.3m due to “goods and services which is largely attributed to settlement of accruals emanating from various obligations such as [to] Vodacom, Sizwe IT Group and these were not sufficiently budgeted for”.

The department of transport was projected to overspend by R100.8m due to the payment of accruals on invoices for the scholar transport programme.

“It is [provincial treasury’s] view that the additional 22,382 learners ferried that were not budgeted for also [had] a contribution to this outcome,” he said.

Human settlements was projected to overspend by R99m due to “misalignment of conditional grants’ revised projections”.

Social development was projected to overspend by R64.3m due to transfers to service centres that were made earlier than projected “as the result of early conclusion of the payment process”.

The provincial legislature overspent by R5.1m on political party allowances processed during the first quarter.

Co-operative governance and traditional affairs overspent by R3.4m “mainly due to departmental cost pressures on audit fees, communication, legal fees, fleet services and computer services”.

DA MPL Yusuf Cassim said the party was “extremely concerned about the projected over-expenditure within several departments in the province”.

“The national adjustments budget has made it clear that there is very little in terms of monetary relief coming to the province.

“This leaves finance MEC Mlungisi Mvoko the unenviable task of trying to balance the books in his adjustments budget next week.

“These departments are spending money they don’t have, resulting in funds being taken from other departments to try and keep the provincial ship afloat.

“This can be attributed to a combination of poor planning and poor internal controls, as well as the inability to bring accruals under control.

“The department of health, for example, had accruals of close to R5bn at the beginning of the financial year.

“It is therefore no surprise that it is the biggest offender,” Cassim said.

Earlier this year, the departments of education, health and transport received a tonguelashing from Mvoko due what he described as their poor planning, to the detriment of the provincial fiscus.

The department revised its district grant business plan to appoint these 642 professional nurses and eight health promoters

The department of health had accruals of close to R5bn ... It is therefore no surprise that it is the biggest offender