The Democratic Alliance (DA) on Sunday called for action to be taken against government officials responsible for mismanagement of finances.
DA defence spokesperson Roy Jankielsohn said the annual report of the Department of Defence tabled in Parliament showed that the department had received a qualified audit opinion from the auditor general (AG) for the fifth year in a row.
A qualified audit opinion indicates that there are certain aspects of the financial statements on which the AG cannot express an opinion because they are false or incorrect and do not accurately represent how the department spent its money.
”Action must now be taken to remove those people responsible for the mismanagement of the department’s finances from their positions. Along with defence, correctional services and home affairs have also received qualified audit opinions from the AG for each of the last five years,” said Jankielsohn.
The Department of Public Enterprises was the only department whose finances where deemed ”clean” by the AG. Of the 17
departments that had tabled their annual reports so far, seven received qualified or disclaimer opinions while nine had ”emphasis of matter” highlighted by the AG, with regard to various aspects of their financial practice and management.
”It is simply appalling that this government seems incapable of properly managing public money. To receive a single qualified audit opinion is deeply problematic, for three departments to receive five in a row demonstrates a fundamental inability to, first, properly spend and account for a budget and, second, manage a department and implement policy,” Jankielsohn said in a press statement.
He said that receiving five qualified audit opinions meant all three bodies that are meant to check and manage finances had failed. These are the director general, the chief financial officer and the audit committee.
”If the African National Congress government really is committed to responsible and accountable management — as it keeps saying it is — it now needs to act in a responsible manner and account for this failure. Steps must be taken against those responsible.”
The DA recommends that departments that have failed to manage public money for three years running should be removed from their positions.
In the AG’s seven-page report on mismanagement by the defence department, more than R567-million in travel and subsistence claims could not be validated against their original supporting documents.
There was a R12-million drop in departmental revenue that could not be sufficiently probed due to the lack of internal controls.
The lack of independent management reconciliation meant that the AG could not reach a conclusion on housing loan guarantees totalling R123-million, said Jankielsohn.
He added that a botched rank review had complicated the auditing process to such an extent that the irregular expenditure incurred over the last three years could not be determined.
The AG also drew attention to deficiencies in leave administration controls, the monitoring of material losses, asset management, financial accounting and the property management procedures of the department.
”The current administration in the Department of Defence has failed. It should be replaced by one that will succeed. That is what would happen in the private sector. Just because public money is involved doesn’t mean standards should drop.” — Sapa