AG: Non-compliance to blame for rise in irregular spending
The Auditor General confirmed that government departments racked up more than R46bn in irregular spending.
CAPE TOWN - Auditor General Kimi Makwetu says non-compliance is to blame for the whopping 80% increase in government irregular spending.
Makwetu confirmed on Wednesday that national and provincial departments racked up more than R46 billion in irregular spending over the past financial year.
#AGSA 80% increase in irregular expenditure on previous year - it's at R46,46bn for 2015-16 (R25,7bn prior year) GD— EWN Reporter (@ewnreporter) November 16, 2016
Makwetu says the main reason for the rise in irregular expenditure was state officials’ failure to comply with the rules on procuring goods and services.
“One of the things that are contributing to this irregular expenditure is deviations from supply chains. And the attributed reasons would be emergency sourcing. So, if somebody has an emergency to source a particular project, goods or services they deviate from the prescribed rules.”
Makwetu says the Passenger Rail Agency of South Africa (Prasa) was responsible for R13.9 billion of irregular expenditure on its own.
#AGSA Fruitless & wasteful expenditure also up at R1,37bn, and incurred by increasing number of auditees. GD— EWN Reporter (@ewnreporter) November 16, 2016
#AGSA Financial health of 76% depts, 39% public entities "concerning" or need intervention, "a regression over past 3 years". GD— EWN Reporter (@ewnreporter) November 16, 2016
Makwetu says the financial health of 76% of departments and 39% of public entities audited either needs intervention or is causing concern.
He says 5% of departments and 10% of public entities were in such poor shape at the financial year-end that there was uncertainty about their ability to continue operating.
(Edited by Zamangwane Shange)