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Makwetu: Govt racked up irregular expenditure of at least R50bn

Auditor-General Kimi Makwetu is briefing a joint meeting of Parliament’s Standing Committees on Public Accounts and Appropriations on the outcomes of the 2017/18 audit of national and provincial departments and their entities.

FILE: Auditor-General Kimi Makwetu. Picture: Christa Eybers/EWN

CAPE TOWN - Auditor-General Kimi Makwetu has revealed that government racked up irregular expenditure of at least R50 billion during the past financial year, an increase of nearly R5 billion in the previous year.

Fruitless and wasteful expenditure soared by 200%, from just under R1 billion to R2.5 billion.

Unauthorised spending rose by 38%, to just over R2 billion.

Makwetu is briefing a joint meeting of Parliament’s Standing Committees on Public Accounts and Appropriations on the outcomes of the 2017/18 audit of national and provincial departments and their entities.

He’s painted a grim picture of declining financial health and growing losses, with only limited improvement in some areas.

Shocked MPs gasped when Makwetu gave the figure.

“In terms of the audit and accounts, the total irregular expenditure that has found itself into the financial statements as audited for this year is sitting at around R50 billion."

Makwetu says the amount may increase as the audit of some state-owned entities, including SAA, Denel and the South African Post Office, are still outstanding because they can’t be signed off on as going concerns.

The Auditor-General defines irregular expenditure as spending that took place without complying with legislation, such as the Public Finance Management Act (PFMA).

Makwetu’s reported a huge increase in the number of departments and entities across government submitting their financial statement late. He has also warned that 16 departments, responsible for nearly R80 billion of the national budget, are in a vulnerable position, while 82 did not have enough funds at the financial year end to settle their liabilities.

The top 10 offenders listed below account for irregular expenditure of just under R46 billion in total.

Audits finalised later, however, uncovered a further R4.8 billion – of which the Passenger Rail Agency of South Africa (Prasa) was responsible for just under R4 billion - rounding the figure off to R50 billion.

KZN Department of Transport R5.48 billion

Water Trading Entity – R4.56 billion

Gauteng Roads and Transport – R2 billion

Department of Water and Sanitation – R1.97 billion

Department of Correctional Services – R1.89 billion

KZN Department of Health – R1.8 billion

Gauteng Department of Health – R1.7 billion

Free State Police, Roads and Transport – R1.6 billion

Gauteng Human Settlements – R1.38 billion

NW Public Works and Roads – R1.13 billion

(Edited by Mihlali Ntsabo)

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