Auditor-General Tsakani Maluleke’s office has revealed large amounts of unauthorised, irregular, fruitless and wasteful expenditure in the City of Johannesburg and the Ekurhuleni Metro. Picture: Thobile Mathonsi / Independent Newspapers
THE City of Johannesburg has laid down its plans to deal with nearly R4.74 billion in irregular and unauthorised expenditure disclosed in its 2023/24 annual report.
The Auditor-General South Africa (AGSA) found that in the 2023/24 financial year, the municipality failed to take reasonable steps to prevent irregular expenditure amounting to nearly R2bn as well as R2.755bn in unauthorised expenditure.
”The majority of the unauthorised expenditure was caused by overspending on key votes,” the AGSA report stated.
In the City of Joburg’s remedial action plan prepared in terms of the AGSA’s 2023/24 report, the municipality noted that the majority of the irregular expenditure comes from multi-year contracts, which have been previously declared irregular, including the R1.2bn Afrirent fleet deal.
”Management has reviewed the AGSA finding and found that the finding was based on incorrect information provided by the city. Some of the information relates to the previous contract. The finding was discussed with AGSA and the feedback from AGSA is still pending,” the remedial action plan explained.
The City of Joburg also has an unauthorised, irregular, fruitless, and wasteful expenditure (UIFWe) reduction strategy, which awaits approval by council.
According to the UIFWe reduction strategy, it will include enhanced consequence management as well as implementation of recovery actions for material irregularities and initiation of legal proceedings to reinforce accountability and recover municipal funds.
It will also introduce independent probity of high value tenders including regulatory compliance reviews of applications for deviation from normal procurement as another preventative measure to mitigate the incurrence of new UIFWe.
Last week, AGSA in Gauteng identified poor consequence management and accountability, high irregular, fruitless and wasteful expenditure balances among the key challenges facing the City of Joburg in the 2022/23 financial year.
DA Johannesburg caucus leader Belinda Kayser-Echeozonjoku on Thursday said one of the major challenges facing local government was instability, which she described as a major problem.
”I think we have had about eight to nine mayors over the past couple of years, and everybody does not continue with the work that has been done.
“Instead of looking at programmes that are there that work for everybody, when the new mayor comes in, they set their own set of priorities, which is a challenge,” Kayser-Echeozonjoku said.
She said the DA has already started initiating requesting lifestyle audits for politicians and officials that are working in senior management.
”We also wanted to ensure that there is a skills audit being done to try to ensure that the right people are in the right jobs,” Kayser-Echeozonjoku explained.
In addition, decisions taken by councillors should be investigated in cases where they were advised not to proceed or to not oppose illegal decisions.
”And where the city has lost and you and I as residents are losing money, that money should be recovered from the politicians who made those decisions. That would go a long way in starting to hold people accountable for those wrong decisions,” added Kayser-Echeozonjoku.
The Ekurhuleni Metro has referred all instances of UIFWe, which totals nearly R2.2bn in 2023/24 to its municipal public accounts committee (MPAC) for further investigations and determination of appropriate steps to be taken in accordance with the Municipal Finance Management Act.
The committee has been tasked with reporting back to council no later than the end of April, and include recommendations regarding whether the expenditure must be recovered from the employees and/or service providers where it is found that the irregular, fruitless, and wasteful expenditure was incurred deliberately and negligently.
MPAC must also make findings on whether the irregular, fruitless and wasteful expenditure should be certified as irrecoverable, in which case council must write it off.
loyiso.sidimba@inl.co.za
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