Public protector Thuli Madonsela's report uncovered a trail of maladministration, from ministers to officials, starting with a lack of basic knowledge about the laws and policies governing security upgrades for projects such as President Jacob Zuma's Nkandla homestead.
Madonsela said on Wednesday, during a media briefing of her office's findings, that "systemic" policy gaps and "administrative deficiencies" had led to the inflation of costs.
"Key among these being the absence of a cap and an integrated instrument such as the ministerial handbook, where all permissible measures can be found."
The Cabinet policy of 2003 is problematic because it applies to presidents, former presidents, deputy presidents and former deputy presidents.
"The risk of unbridled expenditure in the future is very real and needs immediate curbing."
What constitutes maladministration?
Madonsela instructed Police Minister Nathi Mthethwa to urgently institute a review of the National Key Points Act and to stop any further spending on Nkandla.
The minister of public works at the time, Geoff Doidge, gave Zuma the wrong information about the legal prescripts governing the Nkandla upgrades. The minister of police was no better, she said.
"The minister of police failed to properly apply his mind when signing the declaration of President Jacob Zuma's private residence as a national key point, directing the president to implement security measures at [his] own cost or to properly modify the declaration. This constitutes maladministration."
She said Doidge and Mthethwa "could have provided better executive leadership, especially with regard to speedily assessing the extent and cost of the Nkandla project, particularly when the media broke the story in 2009, and taking decisive measures to curb excessive expenditure."
This also amounted to maladministration, she said.
Supply chain management errors
Officials at the department of public works officials also did not know the basic legal framework surrounding the Nkandla upgrades, Madonsela said.
Many supply chain management errors were therefore allowed to occur: tenders were not advertised, contractors were not properly vetted and costs continued to escalate.
Madonsela also found that funds were transferred from two programmes to build Nkandla – an inner city regeneration programme and "dolomite risk management programme" at the department of public works. This constituted maladministration.