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Irregular expenditure

19th October 2018

By: Riaan de Lange

     

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Take a moment to reflect on the phrase ‘irregular expenditure’. What thoughts does it evoke? Anything?

These two words, I wager, have been rendered devoid of their impact, owing to excessive use.

‘Irregular’ implies the direct contradiction of defined rules and established, documented practice. If ‘irregular’ does not convey this message properly, its syno- nyms surely do, these being ‘improper’, ‘unscrupulous’, ‘unethical’, ‘unprofessional’, ‘unacceptable’ and ‘abnormal’ (this is by no means an exhaustive list). ‘Expenditure’ is the action of monetary spending. The unfortunate thing in South Africa is that ‘irregular’ is not a lone traveller. As an adjective, it is regularly accompanied by adjectives such as ‘unauthorised’, ‘fruitless’ and ‘wasteful’ – the company it keeps!

On October 7, The South African published a story headlined ‘Government racks up R72.6-billion irregular expenditure bill’. TimesLive headlined its own story on the same subject ‘Analysis reveals irregular expenditure of R72-billion in SA’, while Fin24 came up with ‘Irregular expenditure by govt departments and State entities accumulate to R72.6bn – report’ and Business Report, whose story was published on October 8, ‘Government racks up R72.6bn in fruitless, wasteful expenditure – DA’. That is R72 600 000 000. Do the zeros make it more impactful?

The figure compiled by the Democratic Alliance (DA) might well be pre-emptive of the Auditor-General’s (AG) report on irregular expenditure, which, if past practice is anything to go by, will be released in a few weeks. Do you recall the headline ‘Don’t read this report late at night . . . The horror of State spending’? It was a TimesLive’s headline published on November 2, 2017. Just to qualify, that AG report excluded irregular expenditure at municipalities, considering only government departments and State-owned enterprises.

The figures in the recent headlines also exclude municipalities; the AG published the report in irregular expenditure at municipali- ties a few months back. This was reported on May 23 by The South African, which headlined its story: ‘Auditor-General finds over 70% increase in irregular expenditure at municipalities – a whopping R28-billion of irregular expenditure’.

Thus, according to the these reports, irregular expenditure has amounted to R100 600 000 000 – and this figure does not include all government departments or entities.

This begs the question: What corrective action will the South African government take? If your view is that precious little action at all will be taken, then I would venture to say you will not be disappointed.

Irregular expenditure is anything but a reversing trend, which is hardly surprising. According to the AG’s report for the 2016/17 financial year, “irregular expenditure . . . increased by 55% to at least R45.6-billion in the 2016/17 financial year, and the total irregular expenditure incurred over the past four years was R128-billion”. In its reportage on the AG’s report at the time, TimesLive remarked: “The figure could be higher‚ as financials from several entities have not been included. And‚ despite heightened scrutiny of State spending‚ it seems some are still trying to conceal what they have been up to.”

The DAs analysis mentions a number of serial offenders, which do not include all government departments and entities, as some had not yet tabled their reports. Business Report identified the “departments and entities that spent the most money irregularly”, which included Eskom (R19.6-billion), the South African National Roads Agency Limited (R10.5-billion), Transnet (R8.1-billion), the Department of Water and Sanitation (R6.2-billion), the South African Broadcasting Corporation (R5-billion), the Water Trading Entity (R4.9-billion), the Department of Correctional Services (R3.2-billion), the Department of Basic Education (R1.7-billion), the Department of Defence and Military Veterans (R1.7-billion), the Department of International Relations and Cooperation (R1.2-billion), the South African Social Security Agency (R1.7-billion) and the South African Post Office (R1-billion).

What is government doing or planning to do to address and reverse this trend? Remember that no choice constitutes a choice, as author Alfred A Montapert reminded us: “Nobody ever did, or ever will, escape the consequences of his choices.”

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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