Maluleke warns R166 billion in irregular expenditure could still rise

That's because 88 auditees were unable to provide complete figures for the irregular spending they incurred.

FILE: Auditor-General Tsakani Maluleke on 9 December 2020 delivered the second COVID-19 relief fund audit report in Pretoria. Picture: @SAgovnews/Twitter.

CAPE TOWN - Auditor General Tsakani Maluleke has warned that the R166 billion in irregular expenditure racked up by national and provincial departments and entities this year could rise even higher.

That's because 88 auditees were unable to provide complete figures for the irregular spending they incurred.

Maluleke has been briefing on the national and provincial audit outcomes for the 2020/2021 financial year, which ended in March.

She has reported a general improvement in audit outcomes, but has red-flagged the deteriorating performance of state-owned enterprises and key service delivery departments, such as health, education, human settlements, and public works.

The R166 billion in irregular expenditure is up on last year’s figure of R109.82 billion.

Maluleke said R77.5 billion of the irregular expenditure was incurred by student financial aid scheme Nsfas due to non-compliance with bursary regulations.

Maluleke said the amount of irregular expenditure could rise even higher.

"This year there were 88 auditees that didn't confirm the completeness of their irregular expenditure number, so in reality, our assessment and our experience is that then the R166 billion is understated.”

State-owned companies remain a problem with the Post Office, Denel, the Land Bank, SAA and SA Express still with outstanding audits and others showing signs of regression.

Maluleke said key service delivery departments such as health, education, human settlements, and public works are lagging behind.

"Poor financial and performance management in the key service-delivery departments means that citizens are denied critical services that can help sustain and improve their lives.

"Service delivery is of key concern to all south africans especially in a period where limited resources are available to respond to service delivery needs, which needs have increased due to the covid pandemic," Maluleke said.