Gauteng’s best audit report in 13 years

PUBLISHED: Fri, 26 Aug 2016 09:40:48 GMT

Seven Gauteng departments have achieved clean audit status for the 2015/2016 financial year in the Auditor General’s report released this week. Gauteng Premier David Makhura told the media that clean audits in the province moved from 54% in the previous financial year to 60% this year.

This is the best performance recorded by the province in 13 years. Makhura said this served as an indication that the province was on track towards achieving its goal of establishing credible financial control systems and ultimately realising 100 per cent clean audits.

“Good audit outcomes are an indication of strong accountability and improvements in the goal of being a clean government,” he said.

The seven provincial departments that achieved clean audits are: the Office of the Premier, the legislature, co-operative governance and traditional affairs, the provincial treasury, social development, economic development and e-government.

Unqualified audits were achieved by seven provincial departments: education, community safety, roads and transport, infrastructure development, agriculture and rural development, health and human settlement.

The Premier drew particular attention to the department of health, which had difficulties for over a decade, and had a track record of qualified audits. This year it moved to unqualified status.

“We are very pleased that the department of health has come out of this,” Makhura said. “The intervention plan that we put in place has helped. So we are now shifting from just worrying about unqualified audits to delivering health outcomes that we want. And we want health institutions in Gauteng to provide the best public healthcare in South Africa. That is our dream.”

Another department that concerned the province was G-Fleet, the government fleet management company in Gauteng, which had the worst audit results in the past financial year, with a ‘disclaimer’.

“A disclaimer means your finances are not worth reporting on, you are in such a bad state,” the Premier said. “For two years they had been going down. Last year we took a decision to remove the CEO and appoint a new management team at G-Fleet, and that new management team has delivered the results. G-Fleet has moved from a disclaimer to an unqualified audit just in one year. We are very pleased with this performance.”

The goal over the next two years of this administration is to ensure there are no more qualified audits and disclaimers.  

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“We also want to emphasise the need of compliance with procurement rules and regulations. We would like to conduct extensive reviews of monthly, quarterly and annual financial statements … to ensure that every department is assisted, including training to accounting officers, but to be uncompromising on compliance,” the Premier said.

One of the issues raised by the A.G’s report is irregular expenditure. Another is that some departments don’t pay service providers within 30 days.

Makhura said the principal instrument with which to eradicate irregular expenditure was the Open Tender System, which was being rolled out in all departments in the province. This system would ensure transparency in procurement and ensure compliance.

The matter of delayed payment to service providers is being addressed by MEC for Finance Paul Mashatile, who is leading the Cutting Red Tape Task Team. The target is for payments to be made within 15 days.  

When businesses apply for development approvals, it can take up to 30 months to come through because of red tape. “So, we want to make Gauteng much more responsive to its residents, to make Gauteng much more responsive also to business, because we need business to invest in this economy to turn it around, to transform this economy, to create more employment,” Makhura said. “But government has to function much more efficiently.”

The Gauteng Investment Centre is part of the Cutting Red Tape initiative.

“We want to set standards across the province,” he continued. “And we will pull municipalities, all these things we are doing in the province, we want them to apply to the whole of government. We want all the municipalities in Gauteng to cut payment periods from 30 to 15 days. We would like all of the municipalities to achieve clean audits.

The Open Tender System was implemented in Ekhurhuleni last year, and the Premier hoped that other municipalities would follow suit.

“The Open Tender System is good for governance,” he said. “And that is why we would like to work with all municipalities that would like to implement it in Gauteng. It is part of our approach to governance, that we hide nothing from citizens whose taxes we are the custodians of.”

Wrapping up the press conference, the Premier said he was looking forward to working with the new mayors in the province to turn around the performance of the economy in each of the development corridors and unlock the potential of every sector of the Gauteng economy. 

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