/ 21 August 2009

DA accuses Land Bank of wasteful expenditure

The Land Bank has lost R16,5-million through fruitless and wasteful expenditure in the last financial year, the Democratic Alliance (DA) said on Friday.

This was revealed in its 2008/09 annual report, DA MP Lourie Bosman said in a statement.

The majority of the wasteful expenditure is as a result of ”payroll-related payments” and the late payment of utility accounts, Bosman said.

”Furthermore, and even more disturbing, the Land Bank has been unable to pinpoint who is responsible for the money lost.”

The DA applauded the financial recovery the Land Bank had achieved, but said this was overshadowed ”by this kind of maladministration”.

The board of directors noted that while most of the fruitless and wasteful expenditure occurred before the start of the reporting period, ”the bank continues to waste money where capacity and process challenges remain”.

As an example of this, the board cites the fact that the bank still incurs penalties and interest for late payment of payroll-related regulatory payments and late payment of utility accounts.

One of the reasons for this was ”a historical breakdown in governance structures and control…”

The Auditor General did not qualify his audit opinion of the Land Bank, but did highlight the R16,5-million as significant and problematic, Bosman said.

”Perhaps the most significant problem with this particular finding is that neither the board of directors nor the Auditor General were able to determine who was responsible for the loss or to identify how the money might be recovered.

”The report cannot determine what the money was wasted on, but there can be little doubt it wasn’t farming.”

On Thursday, Minister in the Presidency for Planning Trevor Manuel said opposition parties should stop pressuring Land Bank chief executive Phakamani Hadebe for the release of names of those accused of corruption at the Land Bank.

”As people are charged their names will be a matter of public record. Don’t ask him to be prosecutor and judge in this matter.”

A criminal investigation is under way into the misappropriation of R2-billion at the bank, which finances emerging farmers.

Auditors blew the whistle on widespread wrongdoing at the bank two years ago, but so far nobody has been charged.

The Finance Ministry has given the bank R3,5-billion in credit guarantees.

Four forensic investigations into irregularities at the bank are under way — including a probe into the alleged transfer of millions from the bank to black economic empowerment companies.

These have dragged on, partly because of the demise of the Scorpions and the transfer of two investigations to the new anti-corruption unit, the Hawks.

A row broke out between the DA and the Finance Ministry in July when the opposition party accused Deputy Finance Minister Nhlanhla Nene of refusing to name Land Bank fraud suspects to spare the ANC embarrassment.

According to a press report last month, one of the suspects was a former Gauteng politician. — Sapa