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Thursday, August 22, 2019
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Minister Nxesi fights fraud and corruption.

R34.9 billion of irregular expenditure wasdiscovered by Department of Public Works.

The Department of Public Works turnaround efforts have uncovered R34.9 billion of irregular expenditure,some of which goes

as far back as 2001.Of this, R1.1 billion is being investigated for fraud and corruption.

The Department of Public Works’ Minister, Thulas Nxesi, briefed the media on the findings and the challenges the department is facing as well as the strategy to recover these monies.

The department has tasked both the Property Management Trading Entity (PMTE),which will deal with major investigations as it better skilled to handle such,and the department’s internal Special Investigation Unit (SIU) which will deal with minor investigations.

PMTE is a component of government, in this case reporting to the Director – General and the Minister. It acts as a special department using international standards and accounting norms to manage state assets.

The minister said “The department is winning the war against maladministration, poor performance and issues of fraud and corruption".

 Criminal cases against department staff have been opened and are still ongoing and the breakdown is as follows:

  • 2009/ 2010 – 14 cases
  • 2010/2011 – 4 cases
  • 2011/2012 – 15 cases
  • 2012/2013 – 5 cases
  • The Public Finance Management Act (PFMA)
  • Treasury Regulations
  • Treasury instructions
  • Any policies and procedures issued by the department or other legislation

In this current year about 15 cases are investigated including the Nkandla.

The reported irregular expenditure was apparently accumulated over a number of years, dating as far back as 2001, whereby 1.3 million transactions were reviewed in detail. These include the following:

He also emphasized that irregular transactionsdid not necessarily mean that there was fraud or money lost or even wasted, but it couldalso mean there was incomplete documentation in the procurement processes.

It could also be a matter ofa number of reasons including incorrectapproval processes, signed documents not meeting proper requirements, no competitive bidding process followed, etc.

Brief preview of years in which irregular expenditure was incurred:

  • 2009/10 – R22.6 billion about 65%
  • 2010/2011 – R4.9 billion about 14%
  • 2011/2012 – R3.8 billion about 11%
  • 2012/2013 – R3.1 billion about 8%
  • 2013/2014 – R500 million about 2%

“This clearly shows the decrease since the turnaround plan of 7 years has been implemented. The national treasury policy requires that each and every one of these irregular expenditure needs to be fully investigated and accountability determined..” he added.

He also touched the department’s transparency measures aimed at getting its house in order by discussing problems encountered so that these problems can be addressed adequately.

" various PMTE vacancies with particular expertise and skillshave been advertised and the recruitment process is underway" he said. 

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