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Business executive manager for the Auditor-General’s office in Mpumalanga, Bomkazi Bhobo.

Municipalities’ audits improve, but…

Municipalities in Mpumalanga have written off R331 million in the 2017/17 financial year, and this is attributed to their failure to investigate and act on irregular expenditure.

The Auditor-General’s business executive manager responsible for Mpumalanga, Bomkazi Bhobo revealed this during a press briefing on the audit performance of Mpumalanga’s municipalities.

“This indicates that investigations are not taking place or are not rigorous enough to resolve the significant balance of irregular expenditure recorded by the province. The lack of accountability and consequence management was consistently reported in previous years, but no swift progress had been made in this regard,” said Bhobo.

Mbombela, Bushbuckridge and Mkhondo local municipalities were the biggest culprits when it comes to irregular expenditure, with R493 million and R348 million and R236 million irregular expenditure respectively.

Bhobo did not say what the proportion of the irregular expenditure to the overall budget of the individual municipalities, but revealed that 70% of the irregular expenditure is attributed to multi-year contracts which were rewarded irregularly the previous years.

The AG’s office also decried the failure to investigate findings and act on them was a major drawback in the fight against corruption. 

“Of concern is the consistent and insistent calls for stricter consequences have not been heeded. We reported material non-compliance with legislation dealing with consequences at 50% of the municipalities. This lack of consequences is also evident in municipalities again not paying sufficient attention to the findings on supply chain management and the indicators of possible fraud or improper conduct that we reported and recommended for investigation,” said Bhobo.

Notwithstanding the spiraling irregular expenditure and failure to act on the auditor general’s findings, Bhobo said that the audit results of Mpumalanga local municipalities were improving.

“In the first year, the new administration of the Mpumalanga local government saw an improvement in the 2016/17 audit outcomes. There has been a notable improvement in the reduction of disclaimed audit opinions over the past three years from municipalities to only one; as well as a reduction in the number of qualified audit opinions in 2016/17,” said Bhobo.

The consolidated Municipal Finance Management Act (MFMA) report for 2016/17 shows that only two municipalities, Ehlanzeni and Nkangala district municipalities received clean audits.

Steve Tshwete municipality which, in the past, had been receiving clean audit outcomes since 2009, has regressed and received an unqualified audit opinion with findings.

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