Auditor-General Tsakani Maluleke has found that there was very little movement on the accumulated irregular expenditure balance since the term of current municipal councils started in 2021/22.
Image: Thobile Mathonsi / Independent Newspapers
Auditor-General Tsakani Maluleke shed light on the staggering R62 billion of irregular expenditure processed by municipalities over the past five years, primarily through the writing off or condoning of irregular expenditure without adequate investigations.
This disturbing trend was highlighted during a briefing to the Standing Committee on Auditor-General on Friday, when Maluleke indicated that a staggering 99% of the R62 billion in irregular expenditure has been written off, while a mere 1% has been recovered since the beginning of the current councils' term in 2021.
“We found that often they were writing off without investigating,” pointing to the Nelson Mandela Bay Metro and Renosterberg Local Municipalities in the Northern Cape as glaring examples of this negligence.
Maluleke noted that even when investigations were conducted, the processes were often flawed.
“It’s either not scoped to deal with the extent of the findings that we've identified, or it's being written off even without council approval.”
Furthermore, in the case of Mkhanyakude District Municipality in KwaZulu-Natal, it was established that specific officials were liable for misconduct associated with the irregular expenditure, yet the resultant losses remain unrecovered.
“What we have found is that these weaknesses prevail in local municipalities, district municipalities, including metros as well.”
Despite the existence of a consequence management and accountability framework that Maluleke deems to be appropriate, she observed a disappointing lack of diligence and effectiveness in its implementation by both municipal administrations and political leaders.
According to Maluleke, the consequence management and accountability framework that exists is implementable and appropriate in the circumstances.
“As of the end of 2024, 80% had not been dealt with, and 20% had been dealt with through investigations, condonation, and write-offs.”
The fact that 80% of the irregular expenditure remained unresolved was an indication that the culture of impunity prevails,” Maluleke said.
“There isn't enough attention to dealing with irregular expenditure either through investigations, consequence management, loss recovery, and improving controls so that recurrence is avoided.”
Maluleke placed the blame for the ongoing crisis at the door of municipal managers and the councils.
“We are finding a number of Municipal Public Account Committees are simply unable to do what they're supposed to do, and when staff members don't perform in accordance with their given duties, they're also not being held accountable.”
The Auditor-General underscored her commitment to invoking her powers to issue a “certificate of death” when local accounting officials do not comply with her remedial actions.
“We've used our powers to raise a material irregularity where investigations are not being conducted, leading to recoveries, disciplinary measures, or referrals to law enforcement.”
Maluleke stated that her office's efforts alone cannot solve these widespread issues unless responsibility is borne by “the stewards of the public funds”.
Meanwhile, former Ngaka Modiri Molema District manager Allan Olehile Losaba was issued with a “certificate of death” for R4.6 million last October, and was dismissed in December before finalising the settlement agreement.
“Despite all of the different follow-ups, the settlement agreement has not been signed, and the money has not been collected to date,” said Maluleke.
“We have not yet heard from the affected accounting officer (Losaba) on his intention to take the matter to court, and if that happens, we will defend it and inform the committee accordingly,” she added.
Maluleke urged councils to expedite such settlement agreements to facilitate the recovery process once “certificates of death” were issued by her office.