TWO POINT FOUR BILLION
Auditor-general’s shocking report on NC finances
TWO POINT FOUR BILLION – this is the amount of money that was irregularly spent in the 2011/12 financial year across all departments and public entities in the Northern Cape government.
It is almost double the amount irregularly spent in the previous financial year, and 41 percent of this amount was irregularly spent by the Department of Health.
This amount, according to Cope in the Provincial Legislature, could have eradicated the provincial housing backlog by building 43 636 RDP houses at a cost of R55 000 per house; built five new mental health hospitals at the contracted price of R420 million; and fixed 102 times the amount of potholes fixed this year.
The Auditor-General gave an overview of the state of the provincial government’s finances to the Provincial Legislature yesterday.
The A-G revealed that 842 government contracts were awarded to employees or other state officials in the past year, while this number was a measly 38 in the previous financial year.
One contract was illegally awarded to family members of State employees, although the AG’s presentation does not state which contract this was. More detailed information will be revealed when the departments present its annual reports to the legislature next week.
The sheer scale of illegality in the awarding of contracts was reflected in the audits, as every single department received findings with regards to procurement and contract management, and unauthorised, irregular and fruitless and wasteful expenditure. Only three government departments did not receive findings with regards to expenditure management.
No department or public entity received a “clean audit”, which is financially unqualified with no findings. The Department of Health received its tenth disclaimer in a row – the worst type of audit outcome possible. Five departments and three public entities received unqualified audits with findings, while seven departments and five public entities received a qualified audit opinion with findings.
Qualified audit outcomes either arise when one or more financial statements do not conform with the relevant accounting legislation, or could not be verified.
Of the total departments and public entities audited, three improved from the previous financial year, four regressed, and 12 remained unchanged. The departments that regressed from a financially unqualified opinion with findings to a qualified audit in the last year are: Agriculture, Land Reform and Rural Development; Economic Development and Tourism; the Provincial Legislature; and Roads and Public Works.
Officials from the AuditorGeneral’s office in Pretoria were scathing about the Maloof Money Cup yesterday, and said this event was one of the main causes of the regression in the Department of Economic Development and Tourism’s finances.
This is because the AuditorGeneral’s office was unable to obtain any contracts and documentation related to the event. Officials described the event as a “drain on the fiscus” that was not budgeted for.
The Department of Agriculture and the Provincial Legisla- ture, meanwhile, regressed due to possible instances of fraud.
The Department of Co-operative Governance, Human Settlements and Traditional Affairs (Coghsta) was the only department which showed an improvement, moving from a qualified opinion with findings to an unqualified audit opinion with findings.
Education, Sport Arts and Culture, the Office of the Premier, the Provincial Treasury, Social Development, Environmental Affairs and Nature Conservation, and the Department of Transport, Safety and Liaison all remained stagnant with either unqualified opinions with findings or qualified opinions with findings.