Irregular expenditure among municipalities amounts to R25 billion: Makwetu

SABC News Kimi Makwetu 1 1 - Irregular expenditure among municipalities amounts to R25 billion: Makwetu

Auditor-General, Kimi Makwetu, says irregular expenditure among municipalities has amounted to R25 billion. He was speaking during a media briefing in Pretoria on the local government audits of 257 municipalities for the 2017/18 financial year.

Makwetu says there are 18 municipalities with clean audits around the country, with the Western Cape having the highest number.

He also says there is a growing trend of municipalities that are not following recommendations from the audit office but has indicated that they now have the power to issue binding recommendations.

Makwetu says irregular expenditure has declined but remains high. “Accountability for financial and performance management continues to deteriorate in local government. The level of irregular expenditure, although it was smaller than the previous year, is still on the high side. The total amount identified is R21.2 billion, but it was at the time that we had not factored some of those municipalities that submitted their financial statements late. So you will see in the media release, it then brings another R4 billion into the R21 billion to make it R25 billion of irregular expenditure. These are instances where the compliance with laws and regulations have not been respected.”

Makwetu says pervasive control and monitoring failures are behind 239 out of 257 municipalities not receiving clean audits.

He says the Western Cape has the highest number of municipalities with clean audits.

“We are finding pervasive control and monitoring failures in many places. Some assets generate revenue and when you do not have proper control over them, someone else might be using that asset for private use. Those that failed to pass the test you will find among them a number of control of monitoring failures – either the money has been misused and no one has dared to follow up to make sure that the delivery of the project has been done in accordance with specifications and agreement, and in certain instances the work that has been done, sometimes when it is completed but you will find that whatever has been done has not been properly accounted for.”

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