Cogta wastes R500m in one year, due to lack of accountability

Loose reins at the department of cooperative governance and traditional affairs (Cogta) led to lack of control and irregular expenditure of millions of rands.

During the year under review, the Auditor-General of South Africa (AGSA) found Cogta incurred irregular expenditure amounting to R500 million.

This was disclosed in the financial statements with its root cause related to Community Work Programmes (CWP) contracts which did not follow proper supply chain management processes.

The office of the AG briefed parliament’s portfolio committee on Cogta’s budgetary review and recommendations process.

It stated in its report old CWP contracts worth R492 629 000 were incurred, with payments also made on expired contracts at the national disaster management offices amounting to R7 371 000.

According to the AG’s report, Cogta’s annual report indicated no disciplinary process was undertaken.

Among the many issues was the municipal demarcation board, which incurred R500 000 when the appointed service provider’s tax matters were not in order.

Effective steps were not taken to prevent fruitless and wasteful expenditure amounting to R4 492 278 as required by Section 38 of the Public Finance Management Act (PFMA) and Treasury regulations.

‘The majority of the fruitless and wasteful expenditure was payments made to deceased employees,” the report stated.

“The root cause was lack of controls to ensure investigations were concluded timeously and irregular expenditure reported accordingly.”

Political analyst Dr Ntsikelelo Breakfast said Cogta should not be found wanting like this because it was one department that other departments and municipalities looked up to.

“If they do not lead by example, then one can not expect municipalities to adhere to policy provisions,” he said. Breakfast said this made room for corruption to flourish.

Chief economist at Efficient Group Dawie Roodt said the money would have been much better spent in other places.

Roodt said South Africans have become immune to these kinds of stories. “Even as an economist, I am losing confidence in SA’s future and this is why,” he said.

As the committee called on the department to implement consequence management, the committee noted the department’s leadership did not seem keen on ensuring there were consequences for wrongdoing.

Some of the contracts for procurement were not awarded in an economical manner and/or the prices of the goods or services were not reasonable as required by PFMA.

Some of the invitations to tender for procurement of commodities designated for local content and production did not stipulate the minimum threshold for local production and content as required by the 2017 Procurement Regulation, the report stated.

“In consequence management, we were unable to obtain sufficient appropriate audit evidence that disciplinary steps were taken against officials who had incurred irregular expenditure as required by section 38 of the PFMA,” the report added.

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– lungas@citizen.co.za