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'Irregular expenditure has more than doubled since 2010'

AG Kimi Makwetu says irregular expenditure has doubled in the last five years to nearly R15 billion.

FILE: Auditor-General Thembekile Kimi Makwetu. Picture: AGSA.

PRETORIA - The Auditor General says irregular expenditure and non-compliance of supply chain management legislation at municipalities remains a stubborn problem that has not changed over the last five years.

AG Kimi Makwetu made the comments at the release of the 2014/2015 audit release in Pretoria this morning.

The AG found that irregular expenditure has more than doubled since 2010 - and now stands at more than R14 billion.

Makwetu says compliance of supply chain legislation is the area which has seen the lowest improvement.

"Where the likes of supply chain deviations are dominant, where non-compliance with certain financial management prescripts is not observed. Because this area is low it creates a fertile environment for irregular expenditure to grow."

He says irregular expenditure has doubled in the last five years to nearly R15 billion.

"This irregular expenditure is those instances where the prescribed rules that govern the procurement of goods and services, among others, are not always observed."

Makwetu, however, says there's been encouraging improvements in the municipal audit outcomes over the past five years.

He says the number of municipalities which recorded a clean audit increased from 13 to 54, while municipal entities with the same findings increased to 72.

"The level of adverse and disclaimed opinions... we are pleased to report that these have decreased from in excess of 30 percent of total five years ago to about 11 percent of municipalities in the current year."

Makwetu says fewer municipalities recorded poorer results than the previous period under review.

"It is also worth noting that the levels of regressions during this period has also been quite low. When I say regressions, I mean only 13 percent of the total number of municipalities have gone backwards over these past five years."