R2bn in reckless social spending as Sassa pays for things it never gets

R2bn in reckless social spending as Sassa pays for things it never gets

Picture: Moneyweb

The department of social development has not impressed the Auditor-General yet again.

The department of social development has racked up R2 billion in irregular and fruitless expenditure, mainly due to the South African Social Security Agency’s (Sassa) habit of paying contractor invoices for services that were never delivered.

These payments amounted to a staggering R78 million for the past financial year.

In a parliamentary briefing to the portfolio committee of social development, Auditor-General (AG) Kimi Makwetu said Sassa’s outcome had improved from a qualified opinion to an unqualified opinion with findings on compliance.

The department’s outcome had regressed from an unqualified opinion with findings on compliance to a qualified opinion on social assistance.

“The department and Sassa had submitted annual financial statements timeously, but it was not supported by records that were full and proper,” said the AG.

The presentation did not identify the officials responsible for the expenditure, but in its recommendations to Sassa the AG said it should strengthen its key controls over contract management and update service-level agreements.

Sassa said it had started to improve and implement internal controls measures and oversight over internal processes.

“The reported fruitless and wasteful expenditure as at March 31, 2019 was R77 million,” said spokesperson Kgomoco Diseko yesterday.

“You will note that Sassa managed to improve its audit outcome from a qualified audit opinion in 2016/17 and 2017/18 to an unqualified audit opinion in 2018/19. This was done through validation and completeness of financial misconduct cases.”

He said they had finally introduced pre- and post-audit of new contracts.

“Overall internal controls measures provided positive results and the impact of some of these initiatives introduced will be experienced in the coming financial years,” said Diseko.

Democratic Alliance member of parliament Bridget Masango said Sassa had a significant obligation of meeting human and social needs of the poor.

Masango said the Public Finance Management Act required the accounting officers of government departments to take steps to prevent irregular expenditure, as well as to take disciplinary steps against officials who were found guilty of mismanagement.

The full report will be tabled in parliament next month. – gcinan@citizen.co.za

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